Around the World

1. A big risk for 2008 is that banks may be less willing to lend. Rate cuts may be ineffective because banks are unable to lend or consumers are unable to borrow.
2. Rate cuts might lead to a boom in emerging markets or alternative energy shares.
3. Credit Default Swaps (CDSs), or bond default insurance, may be the thing to watch out for in 2008.
4. A study shows that since 1926, US equities have risen by an average of 8.8% in presidential-election years. Potential problems for this year, however, include housing markets, global credit and the sustainability of record corporate profits.
5. The OECD expects that weakness in the US housing sector will drag down growth in the near term, but is unlikely to trigger a recession. The slowdown in the Euro area will be less pronounced, while in Japan the continuing weaker expansion will eventually lift the econonomy out of deflation.
6. ECRI notes the worsening of US leading indicators, but says it is premature to predict a recession. It expects housing prices to bottom out in 2008.
7. China’s equity markets may eventually crash because they’re not real markets.
8. Analysts are generally bullish on Asian currencies on the back of a good 2008 outlook for the region, as well as a more rapidly rising yuan. High oil prices and tight credit markets remain risks.

The Philippines

1. For this year, the BSP expects the country’s BOP surplus to shrink to $3-$3.5 billion, but the GIR is projected to rise to a high of $37 billion from an expected end-2007 level of $33 billion. This projection assumes high oil and commodity prices, slower demand from Western economies and prolonged global financial turbulence because of the US subprime credit crunch.
2. Philippine exporters expect flat growth in 2008 because of weak economic growth, influenced by the possibility of recession in the US, and a weaker dollar.
3. Meanwhile, the garments industry is expected to continue to grow because of product diversification.
4. The Peso is likely to strengthen further as the outlook on the US economy continues to be weak, remittances remain strong and corporate demand for the dollar falls. Some analysts, however, see the fall in the dollar as a correction.
5. Philippine equities will take their cue from global developments, with investors entering 2008 cautiously.

Tidbits

• Futurists should:

1. Think small;
2. Think short-term;
3. Say you don’t know;
4. Get embedded in a particular industry; and
5. Talk less and listen more.

• Common SME mistakes include:

1. Doing it alone – not delegating/sourcing;
2. Not enough market research;
3. No openness to change; and
4. Not having things in writing.

• To sort out your finances:

1. Set financial goals within specific timeframes;
2. Assess how you manage your money monthly;
3. Make a budget and be disciplined;
4. Save for an emergency fund;
5. Cover the basics like insurance;
6. Save for retirement; and
7. Find ways to cut down on your expenses.