Financial Crisis: A Trickle-down Effect of the Subprime Mortgage UST WHEN WE THOUGHT Bear Stearns was selling part of its business in order to raise enough • Wachovia, the sixth largest lending Jthe last. cash including Philippine American Life & Insurance institution in the US, sold its banking operations to Recent Episode. The global financial industry, Co., its Philippine subsidiary. Citigroup. shocked by the $2/share sale of global investment Most recent, however, was the $326B bailout • The Federal National Mortgage Association bank Bear Stearns to JPMorgan Chase March of the US government given to Citigroup Inc. The (FNMA) or Fannie Mae and Federal Home Loan of this year, was again taken aback middle of bank has lost $160B of market capitalization for Mortgage Corporation (FHLMC) or Freddie Mac, September with the announced bankruptcy of the past year because of the continuous drop in guarantors of the $5 trillion home loans in the US, the 158-year old giant investment bank Lehman the stock price of the company reaching a record was in a danger of collapse due to housing sector Brothers. With the continuous default among the 16-year low. The bailout amounts to $20B in troubles and a lowering stock price resulting to subprime borrowers of the bank, Lehman Brothers’ capital infusion and $306B worth of government government stepping in through nationalizing them stock prices continued to plummet caused by huge guarantees. and giving easy access to Federal Reserve loans. write-down on the troubled mortgage portfolio of This grim scenario leaves us with Goldman • Financial institutions in other arts of the the bank. In order to restore liquidity and replenish Sachs and Morgan Stanley as the two remaining globe such as Bradford and Bingley of the UK and the balance sheet, talks with US Federal Reserve major Wall Street investment banks. However, Fortis of Belgium were given state rescues. and the US Bureau of Treasury were set in order in order to have greater access to central bank • Iceland’s financial system was in a deep to seek for an institution that will purchase a stake lending, both firms applied for commercial bank in Lehman Brothers. Unfortunately, all of the three problem as toxic assets of the country’s leading status. This action was complemented by additional banks are even larger than the gross domestic financial institutions—Korean Development Bank, equity investments (Goldman Sachs got an equity Barclays, and Bank of America—pulled-out from product of the country. Contingency measures investment from Warren Buffet’s holding company coming from other European countries were the talks which left Lehman Brothers resorting to while Morgan Stanley sold 20% of its equity to filing for protection under Chapter 11 of the US taken in order to restore the financial situation in Japanese Mitsubishi UFJ Financial Group.) because Ireland. Bankruptcy Code for the bank’s reorganization. of stricter capital requirements for commercial Aside from Lehman Brothers, several financial banks. Investment banks are subject to lenient All these events in the US brought about institutions also suffered excessive write-down’s. regulations by the US Securities and Exchange plummeting stock prices and indexes across the Merrill Lynch, a huge rival of Lehman Brothers, Commission and have no capital requirements. globe. European and Asian stock markets are down also experienced a fall in its stock prices and write- Commercial banks, on the other hand, are subject because of the fear of a further slip fueled by the down’s and credit-related losses amounting to $52 to stricter regulations and are under the authority belief that we have yet to see the worst in this billion. Day before its rival filed for bankruptcy, of a country’s central bank. latest episode of the financial crisis. Further liquidity problems arise as investors want to liquidate their Merrill Lynch agreed to a sale agreement with Bank Aside from insurance firms and investment of America for a purchase price of $50 billion. capital investments resulting to a panic selling of banks, several lending institutions and government stocks which further causes a decrease in the stock American International Group (AIG), the world’s sponsored enterprises (GSE’s) also recently became prices. Institutions like International Monetary Fund largest insurer also found itself in the financial prey to the subprime crisis. have been seeing a deep recession for the world quagmire caused by its $441 B total derivatives • Washington Mutual, a large loans and economy because of this financial meltdown. For exposure in credit default swaps, a form of savings bank in the US, had a bank failure because example, IMF sees a slowing down of GDP growth insurance against the risks of bond default. It has of real estate losses. The bank assets were sold for different countries with the Philippines having sold 79.9% of its equity to the US Federal reserve by the US regulators to JP Morgan Chase. This is a 3.5% (2.7% according to a November release of and sustained credit rating downgrades from considered the largest bankruptcy in US history. Citigroup) growth for 2009. This is lower than the Moody’s and Standard and Poor’s. It has been CONTINUED ON PAGE 4
WHAT’S INSIDE?
CBA opens to 2 new competitions
Pinoy Cinema Rises 3
Increase in online 3 information
UP Charter of 2008 8
Death of Newspapers 8 the GUILDER | JUNE-NOV 2008 Reviving the Better Days: CBA’s openness to new competitions AST YEAR was definitely not one of the college’s participate in. The FINEX team was chosen a bit criteria in mind, several competitions were opened to Lbetter days. The UP team for the Intercollegiate earlier (December instead of April). Even for PANA the CBA community. Finance Competition (ICFC) by the Financial and Stratmark selections, an invitational subject, First was the aforementioned JCI Best Business Executives Institute of the Philippines (FINEX) finished BA 198, was opened for audition to aspiring BA and Plan Competition where Katrina Mae Magallanes and second to Ateneo De Manila University (ADMU) after BAA students who are good in Marketing. At the end Aileen Meriel Balderama bagged the first prize. Finals ending first for five times compared to the latter’s of the semester-long subject, teams were assessed is coming this October for another new competition, twice. Subsequently, the UP team for the Integrated according to growth in their final presentation and the Investment Research Challenge of the CFA Marketing Communication (IMC) competition by PANA and Stratmark teams were released after Institute. This is a competition where each team the Philippine Association of National Advertisers Summer from the class. With BA 146, however, the will act as independent financial analysts who will Foundation (PANAF) got eliminated already in the first rest that were not chosen in the FINEX competition, value a certain company, which in this year’s case is screening of the strategies. To add more to this, the were given Business Plan making crash courses and the Manila Water Company Inc. (MWCI), and from UP team who participated in the Nationwide search was encouraged to join the Lee Kwan Yew Business valuation of which shall get the stock price of that for the Most Outstanding Accounting students by plan competition. Those who passed were also company and recommend if investors should buy of the Association of CPAs in Commerce and Industry prompted to join another competition, the Junior sell that stock. Our university will be represented in (ACPACI) got disqualified for allegedly violating a rule Chamber International (JCI) Best Business Plan this competition by 5 BS BAA students, namely, Oliver in the said competition. These consecutive incidents Competition and here the better days of the CBA Allan Co, Nikki Isabel Laynes, Ralph Joseph Pantua, have never and will never be blamed on the students are again being revived. Mark Rome Race, and, John Edward Labay. who willingly and passionately represented the The college’s very own BS BAA students, Katrina college. Mae Magallanes and Aileen Meriel Balderama, Aside from these competitions, the college, especially its dedicated professors, Dani Rose Salazar, As for FINEX and PANA, there was really nothing along with their BS ECE teammate Rosanno JC Gavin Lee, and Daniel Borja, have also been helping the administration can do. Nonetheless, the case De Dios represented the university in the JCI other competitions even if the teams run without the for the ACPACI anomaly still stood. From Guilder’s Best Business Plan Competition and bagged the college’s funding. One of those is our university’s last issue, the latest act published was when the first prize. Their company, IEM Solutions, Inc. is representation in the ING Funds Tournament by a administration wrote a letter of protest to and met engaged in the production and distribution of team of three BS BAA students, Michael John Patag, with PICPA to which the decision was to stick with the intelligent environment monitoring system in aid of Jennifer Carla Catahan, and Iris Gem Li. They have judges’ final decision. Still, CBA continued to fight for better productivity in the agricultural sector. This been receiving constant investment advices from the the college and for its students through requesting win may have started CBA’s openness in joining aforementioned professors. Moreover, these professors the Diliman Legal Office to write a formal legal letter new and yet prestigious competitions. Maybe, the also support the UP Junior Philippine Institute of addressed to the organizers to reconsider their good that the incidents last year brought was that Accountants’ (UP JPIA) NCR Cup representatives. decision to disqualify our team. The organizers no CBA became receptive to more options and not longer responded to the letter. After this, The College only limited to the ones imposed by tradition. Aside Of course, even after all these endeavors, then inquired with the Diliman Legal Office of the next from introducing the college, and the university, the college does not take for granted traditional steps that should be taken. The Diliman Legal Office to other playing grounds, more and more of its competitions. The FINEX team is composed by 5 BS provided the college with their legal opinion on the students, are also given the chance to show their BAA students, namely, Maria Theresa Pamintuan, merits of pursuing the case. It is their opinion that the potential and to practice for the real world. Indeed, Brian Baes, Joan Carol Isip, Genesis Santiago, and college should not pursue the case citing similar cases if not for the PANA, FINEX, and especially, ACPACI Rustan Paulo Baltazar. They will be competing for the before where the Supreme Court ruled in favor of the incidents, the college would still be entrapped by eliminations in September 19. The StratMark team, Board of Judges (one similar case was a case related tradition. on the other hand, is composed of 4 BS BA students: to a beauty contest). According to them, no matter The New and the Old Maria Cristina Saniel, Don Ingal, Jay-ar Natal, and what the competence of the judges is, their decision Miguel Tirona, 4 BS BAA students: Gabrielle Faye is still final. It is in this light the college thought of Especially with ACPACI leaving a big slot for Raborar, Maria Kathrine Labrador, Rowene Sarmiento, better alternatives – (1) improving competence on new competitions, the college has included several and Kathleen Mae Giron, and Alternates: Jan Ashley those existing competitions (2) opening the college students to represent it in carefully selected tilts. Rosario and Juancho Barretto. Their case is to reinvent to other untapped but prestigious tilts. Professor Daniel Vincent Borja, the official coach the Araneta Center so as to gain more market share. of the FINEX team, told Guilder that as much as The PANA Team is composed of Marlowe Javier, Pia Reviving the Better Days the college would want to support all competitions, De Jesus, Petrus Carbonnel, Joseph Gutierrez, and As obviously, nothing can change what has happened budget constraints limit this that is why it chooses Raymund Li. Alternates are: Junjun Guevara and last year, it may have been the administration’s goal to only the best for its student-representatives. It Farrah Rodriguez. Their case is to create an Integrated act on it pro-actively. For one, the pool (BA 146 class) chooses according to three criteria: (1) prestige of Marketing Communications campaign on Road Safety. where the FINEX team is being selected has been the the organizers, (2) integrity of the competition, and
FROM THE ASHES: The Rise of Pinoy Indie Digi Cinema
From my death I do rise. From the ashes I do thrive. From the deepest boils of hell. experienced by the vast majority of Filipinos. How can it not be the dominant filmic My own death I do dispell representation of Philippine reality?” – The Phoenix by “Daemon Knight” The Road to Cinemalaya HE PAINFUL DEATH of Philippine mainstream cinema is perhaps a myth to On November 2000, The First Filipino Full-Length Feature Indie Festival a four- Tits producers, but a sad, imminent reality to its mourning audience – a slowly day festival of six new works of up-and-coming independent film makers was held burning funeral pyre. Do not despair, however, because all hope did not go up in in Tanghalang Manuel Conde in CCP. The project was the result of a long process smoke. From the ashes of the old, mediocre films rose a new tradition: the Pinoy of failures and successes by a group of proponents from the Cultural Center of the Indie Digi Cinema. Philippines who were fondly dubbed by then Dean Dea Doromal of the College of Arts and Sciences, UP Ilolilo as Missionaries of Cinema. These people aimed This milestone, commonly referred to as indie, was defined by Professor to promote film appreciation and spread the influence of independent and classic Rolando B. Tolentino of the UP Film Institute as simply “the mode of production Filipino cinema to those without easy access to it. that deviates from mainstream studio funding. It also refers to the “spirit” or intent in filmmaking, focusing on less mainstream and even subaltern, postmodern Manuel Conde, for whom the theater was named after, was one of the most multiple identities – films that mainstream cinema would never produce because independent-minded directors during the First Golden Age of Philippine Cinema; of [their] propensity for art and commercial viability.” Indie films are characterized his work “Genghis Khan was the first Filipino indie film to be acclaimed atan by its use of nonstudio stars, location settings, technicalities and more imaginative international film festival (the 1952 Venice Film Festival). The theater seemed to storytelling. Films of this kind give producers, writers, directors and actors freer indeed be most appropriate for what was yet another milestone in the development reigns for their creativity. of Indie Cinema. While mainstream was on the decline due to the shifting shapes of the masses, the audience asked for something new and fresh; digital films Indie films speak of newer and multiple identities of individual groups instead was dangerously beginning to seem like the perfect solution to the problem, and of the masses (Ang Pagadadalaga ni Maximo Oliveros and Endo), and fittingly look the technology was now within the reach of a new generation of artists, young more like television melodramas than as digital films. It borrows and innovates on creatives with a story to tell. modernist film traditions such as Italian neorealism (the slow-pace storytelling) and new waves from the French, Japanese, Korean and Thai. Unlike mainstream Cinemalaya Now films, indie tackles individual and social realities, poverty, and with no promises Cinemalaya is the product of a joint effort from the government (CCP), the for happy endings, just like reality. private sector (Econolink Investments, Inc.) and the academe (University of the Second Golden Age of Philippine Cinema Philippines Film Institute). The 4th Cinemalaya Independent Film Festival ran from July 11 to the 20th this year in Tanghalang Nicanor Abelardo, CCP, and moved The Indie movement is most often with its forefathers, Lino Brocka (Maynila to the Cine Adarna, University of the Philippines from July 28 to August 6th. It sa Kuko ng Liwanag in 1975 and Orapronobis in 1989), Ishmael Bernal (City After awarded grants to 10 full length and 10 short films – the first complete Cinemalaya Dark – Manila By Night, 1980) and Mike de Leon (Sister Stella L, 1984), who since its pilot festival in 2005. found neutral grounds where they could both focus on their art directed on the aesthetics of poverty and the demands of working for the studios, alongside the Most notable too is the seemingly reversing roles of independent and mainstream figures of independent cinema like Kidlat Tahimik and Nic de Ocampo. films, which was also noticed by the festival participants themselves. Aside from the growing following of indie cinema, the festival has also gone international, Some modern, internationally acclaimed indie films are Ang Babae sa and at least nine foreign festival investors, both Asian and Western, have taken Breakwater and Magnifico, which advanced their own styles and at the same notable interest in the said event. Nestor Jardin, president of the CCP, confirmed time were greatly influenced by Brocka and Bernal’s forms. The movement’s that the Cinemalaya is “gradually being recognized as an important cinema event alternative precursors are filmmakers Lav Diaz and Khavn de la Cruz, who are by programmers abroad.” both still most active in innovation today. Certain realities, however, also had to be faced by the festival participants. The Decline of Mainstream Cinema Budget, especially, was a big concern all around, which at the same time challenged The year 1986 was both a great success in our country’s politics and the the people working behind the scenes to go further in terms of quality and the story manifestation of a cancer out to destroy what was then defined as Filipino itself in order to make their sacrifices worth it. Jardin has already mentioned plans cinema. This was most evident in the year 2000, when the production of Filipino for the next Cinemalaya to institute a training program on alternative financing mainstream films fell almost 40% in three years. Mainstream enthusiasts blame sources for finalists, some of which are foreign institutions as well as through this on a number of factors, namely piracy, incompetence, lack of government “inking deals for theatrical, TV, video or cable rights before finishing their movies”. incentives and outright oppression “through inordinate taxes and arbitrary One lucky entry this year was Boses which received additional support from Unicef, censorship laws”. On the other side are the film scholars, who argue that it was DSWD and the Council for the Welfare of Children for its usefulness as an advocacy a clear case of business suicide. The decade before the EDSA Revolution was the material for Children Against Violence. nouvelle vague (new wave) of Philippine cinema when films were a pleasant mix The Pinoy Indie Cinema Today of talented storytelling and technical know-how. The period after the peaceful revolution until today marked a kamikaze factory mode of film-after-film of the In further support of the belief that “indie” is the new “mainstream”, a number same old material. of mainstream actors have been attracted by the subtle lights and challenging productions of independent films. Of this year’s batch of Cinemalaya finalists, only Professor Edward Cabagnot, chairperson to the Jury Team of the ASEAN New My Fake American Accent used a cast of stage actors, the rest featuring mainstream Media Arts Exhibition commented on the lack of response: “No matter how much actors looking for alternative ways to express their arts. tits-n-ass or exploding cars or sampalans (melodramatic slap-fests) they injected, Pinoy audiences weren’t buying it.” Professor Tolentino summarized what the Pinoy audiences are going to buy, “We want our films about the absentee signifier that somehow organize our collective lives, and this is, of course, the actual poverty CONTINUED ON PAGE 4 the GUILDER | JUNE-NOV 2008 Financial Crisis: A trickle-down effect of sub-prime mortgage original government projection of 3.7%-4.7%. housing boom halted and prices started to fall beginning 2006. Together with the Source of the Problem. This recent financial crisis is not a new story. decrease of the house prices is an increase in the interest rates because of the Since 2007, the subprime mortgage crisis has always been in the headlines automatic interest rate adjustment feature built into the mortgages. This implied because of the big stories that it created inside the financial industry. So what that subprime borrowers have to pay more for their loans as compared to the really caused the subprime mortgage crisis? And why is it called such? current value of the proceeds of their loans which are the houses. Refinancing of The subprime mortgage crisis is a financial crisis brought about by the debt was also impossible as interest rates are higher in the market. the unprecedented increase in the number of subprime borrowers in the For example, assume Mr. Smith borrowed $5,000,000, payable in 30 years market. Subprime borrowers are a group of borrowers that have a relatively with an interest rate of 10%, in order to construct his dream house. Problems higher default risk compared to a prime borrower as indicated by their lower start to surface when price of the houses fall and interest rate rises. So assume level of income, poor or lack of credit history, and their employment status. that by the 5th year the price of the house drops to $1,000,000 and interest Before the innovation called securitization, these subprime borrowers are rates rise up to 15%. This would lead to Mr. Smith paying more than what his not allowed to source loans from the banks. Why? Because banks want to house is worth. He would also find it hard to pay or refinance the debt because protect their business as they would not want to take all the default risk of of the higher interest rates. Therefore, Mr. Smith is highly likely to default on his the subprime borrowers. loan. This default will be replicated across a big number of subprime borrowers However, due to innovation in the financial markets, it is now possible in the market causing huge write-down’s in the bank. This spiraled and caused for banks and other lending institutions to share or transfer borrowers’ the existing problem that we have now. default risk to different investors. This is made possible by securitization—a The first reported case of a significant write-down brought about the subprime process where a lending institution pool and repackage a group of cash-flow crisis was HSBC’s $10.5 B write-down on February 2007. This was followed by producing financial assets (receivables) into securities that are then available many write-downs and merger deals in the financial industry. Investors started for different investors. These financial instruments are usually called asset- to pull-out their investments from these financial instruments and transferred backed securities, mortgage-backed securities (normally for home loans), their money to other forms of assets like commodities. or collateralized-debt obligations. Effectively, the banks can make money Courses of Action. out of their receivables which are supposedly not yet collectible through the securitization process. This is normally done by the banks in order to search Given the existing financial woes of the big investment firms and several for capital especially when additional debt or equity financing would seem lending institutions, several contingency steps were taken by regulatory agencies, to be costly for the company. central banks, and local governments around the globe with the aim of saving the financial market and shoring up confidence of the investors in order to avoid With this financial innovation, banks became less strict when it panic and possible bank-runs. comes to dealing with subprime borrowers. According to Demyanyk and Hemert (2008), subprime loans started to grow since 2001 until 2006. Other In the US, the US Federal Reserve has initiated steps since the onset of the factors which caused this increase were lower interest rates. A big part of crisis to maintain liquidity in the market. Special loan facilities and lower discount the loans sourced by the subprime borrowers were used to purchase houses rates were set in order to give banks an easy source of money once a need as shown by the increase in the home ownerships in the US in this same arises. Regulatory agencies also worked hand-in-hand with ailing firms in the period. search for possible capital infusion. They also administered ad-hoc initiatives in the bail-out of these said institutions. At the onset, it was less of a problem for the players in the market because of the appreciation in the house prices until 2005. This means that However, with the huge scale of the recent problems, a $700 billion proposal the asset they bought from the proceeds of the loan is worth more than the for the bail-out was laid out to the US Congress. The proposal will give the US price they are paying for it. However, problems started to surface when the Secretary of Treasury Hank Paulson the unlimited power to purchase all “toxic Sources: Inquirer Money. Special Report: Legal woes set back BSP move vs. rural banks. By Daxim Lucas. August 24, 2008. || Understanding the Subprime Mortgage Crisis. Yuliya Demyanyk and Otto Van Hemert. August 19, 2008. || MSNBC
The UP Charter of 2008: a more flexible autonomy >> CONTINUED FROM PAGE 8 academic mission and orientation of the national (Philippine General Hospital) in 2006 and 2007, and system. university as well as protect it from undue influence in addition to the P500 million for the science and In the Light of Change and control of commercial interest.” technology complex in Diliman,” Mrs. Arroyo said. As the University of the Philippines, now declared In line with the utilization of assets, Sec 23 This is expedient not just for those in the field of the National University, is continuing to extend the (Safeguards on Assets Disposition) lists the Medicine and Science but for the whole UP system tradition of excellence it has established through the conditions in case negotiations and transactions with as well. This is to consider that a hefty portion course of a century, amendments in legislation and properties are to be made. On the onset, the charter of the university’s budget goes to PGH. With the execution are essential factors in paving its way to prohibits the sale of any existing real property of the university’s facilities presently in grave need of a more attainable vision of being at par with the university ‘provided, that the Board may alienate renovation and advancement, it is agreeable to internationally applauded universities. It all depends real property donated after the effectivity of this think that a considerable amount would be allotted on how well we translate the words of the Charter Act if the terms of the donation specifically allow for the improvisation of laboratories, libraries, and into authentic deeds and legal action. it.’ Sec 23 also adds that transactions are subject other facilities in the different institutions of the UP
EAR 2008 WILL BE REMEMBERED in our must produce 50 million tons more than the current However, as Pres. Arroyo herself admitted during history books as a trying time for the Philippines. level that it produces. the SONA, these solutions are temporary. In her recent Crisis after crisis has swept over the nation. One SONA, the president stated that we need to pursue Y Aside from increasing rice prices due to increased of the more famous problems plaguing our country policies that would lead to food self-sufficiency. She demand, another cause of the shortage is government is the apparent shortage of rice, which has swept us did not state any specific policy, though, to combat policies. Economist Rolando Dy of the University from the start of the year up to now. the problem. of Asia and the Pacific blames “under-investment Ground Zero in agriculture and infrastructure, a poor record in According to agricultural scientist Norman Borlaug, eliminating poverty (and) poor infrastructure quality” it is not enough that the Philipines supply its farmers Everyone is familiar with the rice shortage as another root cause in the ongoing crisis. The World with fertilizers and hybrid seeds to increase rice problem. Long lines of people fighting over two kilos Bank estimates that in Asian countries, the percentage production. What we need, he said, is to improve our of NFA Rice in designated distribution centers have of agricultural GDP allotted to R & D totalled to only irrigation faclities. The government should rehabilitate been common occurrences on television. Commercial 0.4%, as opposed to 2.4% in developed nations. the non-functioning systems, and add more irrigated retailers in dry markets are complaining of decreasing areas. However, increasing commercialization of sales due to increasing rice prices. Restaurants, the Other factors that the IRRI also noted were extreme arable land by farmers who badly need money for most prominent of which was McDonald’s, mused over weather conditions, the lack of arable land for rice their daily needs will further increase the problem. offering half-rice meals. It is estimated that we will production, poor irrigation systems, and increasing import 2.1 million metric tons of rice this year, more oil prices that have not only increased inflationary Dy also noted that the government needs to provide than the 1.2 million metric tons that we have imported pressures, but also increased import costs for import- adequate funding for agricultural R & D programs, on average during the past six years, according to dependent countries like the Philippines. Corruption and for improvements to infrastructure, such as rural Department of Agriculture (DA) estimates. It is ironic in government was also cited as a cause, the most farm-to-market roads. However, problems in the that we are importing from Thailand, Vietnam, and recent of which was the fertilizer funds scam involving bureaucracy, for example, graft and corruption might other Southeast Asian countries whose technology former DA official Jocelyn “Joc-Joc” Bolante. make the solution untenable. in rice cultivation was honed in Philippines-based Finally, Shamika Sirmanne, an economist at the International Rice Research Institute (IRRI). He notes, however, that the crisis might be a UN Economic and Social Commission, stated what blessing in disguise because it might lead into According to former SBMA Chairman Felicito arguably might be the most crucial reason for the investments that might lead to positive effects in the Payumo, the last time the Philippines was self-sufficient crisis: skyrocketing oil prices. Fuel is needed for long run. was in 1971 under the Masagana 99 program of then transportation of goods and for agricultural equipment. President Ferdinand Marcos – 37 years ago. What Also, petroleum is important for chemical products An Uncertain Future happened from that time to the present? How did we that farmers use, such as pesticides and fertilizers. As The Philippines is still reeling from the effects become the world’s largest importer? What remedies long as oil prices rise, commodities such as rice will of the current rice crisis. As economist Rolando Dy can we do to save ourselves from the seemingly also have increasing prices. observed, the problem isn’t just the concern of the bottomless pit? Solving the Crisis executive branch, but also of the legislative and Increasing Prices and Government judicial branches. The different branches must act Since oil prices cannot be controlled by the together in order to solve the problem. However, with The IRRI posited that at the fundamental level, government, we must resort to policies that should the current political system of the Philippines, one the sustained increases in rice prices over the past increase agricultural productivity, while satisfying might lead to think that there will be no end to this 7-8 years shows that we have been consuming more consumer demand. Currently, to solve the crisis, problem. We must hope, though, that this problem than we are producing. Some have attributed this the national government has resorted to giving rice will finally be solved.
getting much of something, we were not even Being a UP student of course, we were soon aware of when we took the UPCAT. That we are the familiarized with the whole UP system of living, centennial batch is something that does not make or rather, surviving. In our Geography class, we Hello us any more than exceptional than the previous or played a game one time wherein we were asked upcoming batches. We were showered with much to name the different UP locations shown in the welcome that we can only thank all those who are projected slides. Our team won second although behind it. we are a pure freshmen group. Thanks to the Administration, whose orientation program included Yoopie! We entered UP on the year where you can feel CD’s which introduced us to the different colleges the vibrancy of an extravagant celebration. But and their locations in UP. although, as a freshman, you are showcased with am riding in a jeepney on a long road lined all the good impressions the university has to offer, The UP campus is a wide campus. In my with shady trees; on both sides are patches there are still those issues whose advocates cannot mentioned geography class, we were tasked to I of vast greenery. As the cool breeze blows be silenced. During the first day of classes we’ve report about the history and symbolism of different my hair into dishevel, I can’t help but feel the already witnessed student activists to seize the places in UP. As of now, to us freshmen, they are surge of pride rumbling in my chest that urges me last part of the orientation to shout out, “Sa wakas, Isko na ako!” If only my program with their cries “Stepping on to UP is indeed a fellow passengers won’t mind. While far ahead are for change. Maybe after the outstretched arms of the oblation that seems all, it is our last lesson fairy tale come true for a dreamer to greet me back, “Welcome freshie!” No wonder, to learn for that day: like me. It’s like catching a deep calleth unto deep. that in UP, where liberality is a lifestyle, it is just a matter of colorful bubble in your grasp Truly, passing the UPCAT is an authentic getting your voice heard. achievement. It is a reward at par with being a without popping it.” Valedictorian or Salutatorian – even greater. Even One of the heated issues among UP if you don’t get awards in your graduation, the students right now is the tuition fee increase, which, merely symbols of past historic events. But I know, UPCAT results can fill in the gap. Likewise, reaping according to our ates and kuya has increased by as we go further along on our own intimate journey medals in your graduation but failing the UPCAT is 300% - a huge percentage to consider. With the within the grounds of UP, every place will have a a lonesome tragedy for some. different levels of social status among the freshmen cherished memory to reminisce, even after we step on whose batch the increase was implemented, out the bounds of this institution. Stepping on to UP is indeed a fairy tale come the responses you would gather would most likely true for a dreamer like me. It’s like catching a vary. Some, for example, would not care much Last but not the least, as a newly admitted ‘Iska,’ colorful bubble in your grasp without popping it. as long as their parents are there to provide and it is now a part of my system (digestive system for I can even remember those Research off-campus they’re getting their desired allowance. Some would that matter) to taste the wide range of UP food. As days turned mini-field trips we had during High willingly join protests because they are concerned far-stretched as your eyes can view UP, so is the school. Our frequent library visits is usually in UP with the cost of living getting higher by the day. choice of food. Almost in every street and corner because it’s one of the nearest to my former school. stands a stall of affordable picks like fish balls and My classmates and I used to exchange aspirations Well, if you think things over, you’d really feel isaw. Yum! To admit, I’ve not yet tried everything in a joking manner about strolling the same roads that students are now aversely affected by the the coops, cafes, or street food stands have in someday not as mere visitors but as real “Iskolars rampant economic crisis. Even the jeepney fares store - though it’s included in my prior agenda ng Bayan”. And voila! After everything has been have already increased during the opening months upon entering UP. of classes. This is one thing that makes us walk said and done, we’re actually here - walking our I have only been here in UP for a few months, dreams. our way almost everyday from Math to AS or back willingly though it’s like self-torture especially when and already I am high with the UP spirit. I can’t I am one of those few freshmen whose batch the sun is up its zenith. wait to see, hear and feel more of what it offers. was chosen by either luck or fate to be dubbed For now, my last class has just been dismissed as the “centennial freshmen.” To be called such, It’s a good thing to mention that we have free and I am leaving the campus grounds. Riding on in a sense, implies being pampered. Yes, we were jeepney rides that cover the Ikot, Toki, and Philcoa a jeepney again, I whisper my good-bye to ‘Oble,’ given special attention simply for the label of being routes every Tuesday. Again, it is a part of the and he in return, waves his two hands back to the one hundredth batch. From the well-prepared centennial celebration of UP. And since, it is only me. and documented orientation program to freebies for the centenary, it will only run until December of Diane Maire Peralta is a BS BAA freshman at UP like free SIM cards, drinks, ice cream etc. name this year. But how much would the jeepney fares Diliman. She enjoys writing and having conversations it - we’ve tasted it. could have increased by then? Anyway, it still pays to be thankful about everything we receive. with upperclassmen. Surely, we, freshmen of this batch are actually death of newspapers >> CONTINUED FROM PAGE 8 media to provide information varies to people with notice that there are several discrepancies in different resources & lifestyles. It is then that it the arguments that may very well be left at the can be concluded that the newspapers, TV, and the personal discretion of the reader. Radio is specially Internet are all complementary of each other. left out, as it can co-exist with newspapers without doing a substantial harm in its demand. It may also be argued that it is probably not the accessibility and the type of information needed The death of newspapers is therefore, something that can explain the sudden decline in newspaper that will not happen in the near future. The World demand, and the corresponding increase in the Association of Newspapers stated there was an TV and Internet demand here in the Philippines. increase in the annual world-wide newspaper The real cause may be the shift in the audience’s circulations of 2.57% in 2007. This amount is interest to more light news, rather than serious in- even higher than the increase in the world-wide depth reporting. With the TV and Internet’s broad population which is approximately 1.54% in mid- range of information, people may opt to choose 2007. those that they personally prefer which may or may Though some family-owned newspapers not be important. We can define importance here already sold or closed their companies in favor of if it can affect (strengthen or change) a person’s big media companies, there will still be some who stand in the current events, which may require that will stand by time and insist on the existence of person’s participation in the society to bring about the newspapers. There will still be people who the desired changes. The change in the people’s will prefer reading a real newspaper, turning the focus or points of interest to information that are pages, and enjoying the smell of the newly-printed more readily supplied by TV & Internet may be the papers. real driver of the increasing viewership of these
at Rodics, is truly astonishing. It is a testament to “... {I} cannot help According to the professors who came up with the fact that U.P. has now become well-known not the TOFI (most notably Dr. Emmanuel De Dios only for its standard of excellence, but for its food but feel sorry for the of the School of Economics), with the current as well. economic conditions, the TOFI is almost a younger batches that are necessity. Prices have risen to exorbitant U.P. Commute levels that without the increase, UP won’t Before the one-way traffic scheme for the affected by the TOFI. be able to sustain itself. Moreover, even with academic oval was implemented during this school the increase in fees, UP teachers are earning so little year, commuting via jeepney – be it within, to, or for the amount of effort and skill required of them. from U.P. – was very efficient. There were several However, the issue comes back to the fact that jeepneys that traveled a ‘counter-clockwise’ path, like THOUGHTS the University of the Philippines is a public school, the IKOT, Philcoa and Pantranco Jeepneys, while two and by law, it should be funded by the government. jeepney classes, the TOKI and Katipunan, traveled a in Random Motion Now, more than ever, being the newly-recognized ‘clockwise’ path. These jeepney classes functioned National University in the country, the government together to provide students a very accessible should be more active in funding the university’s means of getting to the different buildings in the Having stayed in this University for more than programs and endeavors. Unfortunately, that campus, as well as the nearby areas like Katipunan three years, I can attest that the epicenter of UP life remains to be a reality, and so the university must and Philcoa. Every building was most likely in one is not without excitement, realizations and of course, act on its own for changes to happen. jeepney’s route, meaning that a student can get to creative discourse. There are days when my life wherever he or she wants just by riding the right here revolved only around the college, but in most The author sees the TOFI as the result of the UP jeepney. cases, UP has continually been a bombardment of administration “giving up” on government subsidy and taking matters into their own hands. Of course, The one-way traffic scheme was one of the biggest everything—from university-wide issues like the things students and jeepney drivers alike had to get TOFI up to the mundaneness of the simple isaw. one may see this article as biased, with the writer coming from the College of Business Administration. accustomed to for this academic school year, mainly Tuition and Other Fees Increase (TOFI) However, one cannot simply ignore the facts and because students did not know the new routes the jeepneys had to take given the one-way path, while Ever since its implementation, there have been the justifications behind the implementation of the TOFI. As a UP student, the author cannot help but some jeepney types lost their competitive advantage mixed reactions to the Tuition and Other Fees because the drivers were forced to take paths similar Increase, otherwise known as TOFI. Much has feel sorry for the younger batches that are affected by the TOFI. to other jeepneys (the TOKI is the biggest change, been said about it, and protests against it have as the once clockwise path it usually took is gone, continuously surfaced ever since its inception in U.P. Food leaving it to follow a somewhat similar path that IKOT the academic year 2007-2008. Many colleges, most and Katipunan jeepneys take. A major drawback notably the College of Social Sciences and Philosophy, A U.P. student’s life is often hectic, having to deal not only with academics but with extra-curricular with this traffic scheme is that it is significantly less- see it as unfair treatment of students, especially to efficient compared to before. those who suffer by having to pay the full amount of activities like org work and athletics as well. It is no the 300% increased tuition, but lack the resources surprise that students here get hungry easily, which The one-way traffic scheme was meant to to do so. Countless rallies have ensued because of is why dozens of kiosks are scattered throughout the encourage people to walk or ride bikes instead of the negative reactions and publicity regarding the campus. riding jeepneys that emit harmful exhaust chemicals, TOFI. After having spent more than three years studying but so far the change has been received by the U.P. in the University, it is safe to say that as a senior population with mixed reactions. Some like the From a senior student’s standpoint, however, the idea of a cleaner academic oval, while some have TOFI’s impact is less felt, as the author comes from a student, the writer has tasted practically everything the campus has to offer. From the affordable found commuting within the U.P. campus a time- batch that, even up to now, still pays the old amount consuming process. Also, jeepney drivers, as they of 300 pesos per unit. With this, our batch cannot meals like isaw, pancit canton, fishballs, and kwek- kwek, to the high-end ones in Chocolate Kiss and vocally express during the rides, want the old traffic feel the full brunt of the TOFI’s effects, and can only scheme’s reimplementation. assess it from an outsider’s point of view. Cordillera Coffee, the University offers a wide range of gastronomic experiences that caters to the just- Like with all changes, however, it will take time This impartiality helps us see the supposed logic as-wide range of cultures that study there. for the people to fully adjust. Eventually, just like behind the TOFI’s implementation. Most proponents this year’s freshmen batch, which was not aware of of the TOFI come from the School of Economics and This setup allows the U.P. student to choose from different kinds of meals, and ensures that the the two-way academic oval, everyone will get used the College of Business Administration, and with to the new traffic scheme. these two institutions come their school of thought student will never get bored of the food and will on why the price people pay for a UP education has always have something new to try. Seeing people Kyle Dael is the UP CBA Seniors’ Batch Representative. to increase. from neighboring colleges and universities within the He is outspoken, creative and is always online during the U.P. grounds, usually at the nearby isawan stalls or dead hours of the night.
UP FIGHT!
HE YEAR 2008 marks not only UP’s centennial year. and exciting games. Even though they lost in certain TLast July 5, 2008 Saturday, UAAP 71st Season games, the team was not left behind the whole time. opened with the University of the Philippines as this The players have matured and now show that they do year’s host. The opening ceremonies were held in have potential. Indeed, this season’s performance is a Araneta Coliseum at around 1 o’clock in the afternoon. stark improvement from last year’s (0-14 record) but The show’s high-energy performances involved many the team has a long way to go. A ‘final four’ slot may dance organizations from UP, which revolved around be against the odds, but UP must first focus on being a the theme Filipino Leadership through Excellence in competitive team. Sports. UP President Emerlinda Roman gave her opening remarks at the commencement of the ceremony. As a student-watcher commented, “Our boys need to develop confidence, morale, and a championship habit.” The opening ceremonies also officially marked the And that habit is a never-say-die spirit. The team must start of the basketball games. This year, the Men’s not settle and always set their hearts out that they will Basketball Team is led by new coach, Aboy Castro. The be able to redeem themselves. To not easily lose their UP Fighting Maroons have 3 wins-8 losses as of August, grip. Their training now is more focused and intense; so second round. This includes UP’s first ever match in the the team may still be able to surprise in their remaining season, played against NU bulldogs, nailing a 14-point games. They’ve already shown that they can. All they lead. have to do now is do it.
AFTER 1 YEARS OF WAIT Pres. Gloria certain privileges that an Ateneo professor does decides. They shall also recommend five banks that Arroyo finally signed the Republic Act No. 9500 not, and that is academic freedom, both personal would take care of the funds of the University. Aat the UP library Conference Hall in Lahug in and institutional, as well as security of tenure. My One of the primary concerns about these Cebu last April 29, 2008. This momentous renewal theory is that if a UP professor gets at least two- changes in the managerial devise is the possibility of of policies declared UP as the National University thirds of an Ateneo professor’s salary, then they are commercialization with the academe as its forefront. with a more flexible autonomy of power and a whole already at par.” He also adds that with an improved Such concernis inevitable with the inclusion of the new make-over for its managerial devise. remuneration, the university can not only attract the names of private entities in the charter. best and the brightest but also keep them. A New Structure of Power These private institutions, given the flexibility, This also exempts UP employees from the Salary might play a major role in the outsourcing of Sec. 12 of the charter establishes the new Standardization Law which in turn, takes out the stratum of governance with its enumeration of funds in such a way that the university’s research 10% salary increase privilege from them. As of the projects and agenda would only be narrowed into the composition of the “Board of Regents of the moment, the university does not have immediate University of the Philippines System.” the commercial arena driven only by the search for funds yet to augment the salaries of its faculty profit. Another concern is that an increase in the One salient characteristic of this new charter is and employees but with this new charter at hand, tuition fee may be implemented as the administration that it gives the Board of Regents full sovereignty better compensation can be constructed for these deems without prior consultation with the students in generating funds and incomes for the University. mentors of bright minds. This also, with the hope of as stated in Sec 13 (m). However, Dr. Emerlinda It also provides the BOR with the authority over preventing the exodus of its teaching staff to private Roman counters these reactions with her statement: the compensation of the UP President (stated chief institutions local and abroad. “Commercialization… happens when a learning executive office of the university) to its faculty and Academic Progress vs. Commercialization institution merely becomes a diploma mill. It’s when staff. a school merely accepts students and keeps them Furthermore the Section 24 of the RA declares According to the charter as stated in Sec. 13 (k), afloat, then increases tuition.” Putting to profitable the organization of an independent trust committee use assets like idle lands and inventions arising the BOR can now design the compensation plan for to be composed of the President of the University, the salaries and benefits of faculty and employees, from research are her plans in mind in line with the as Chairperson, and one representative from the freedom of the UP administration with its sourcing ‘provided that [these] shall be equivalent to those following: the Bankers Association of the Philippines being received by their counterparts in the private of funds. Sec. 22 (f) further acknowledges this, “Any (BAP), the Investment Houses Association of the plan to generate revenues and other sources from sector.’ Sen. Angara, who became the 14th UP Philippines (IHAP), the Trust Officers Association of president states, “At present a professor from, say, land grants and other real properties entrusted to the Philippines (TOAP) and the Financial Executive the national university shall be consistent with the Ateneo receives up to three times more than what Institute of the Philippines (FINEX). These members a UP professor does. But a UP professor enjoys are “entitled to a reasonable per diem” as the board CONTINUED ON PAGE 4 James Autor. Cartoonist John Edward Labay The Guilder institute Maelyn del Pinado Katrina Magallanes Kathleen Mae Giron, Beiai Torres, Precious Ro- Associate Editors for Administration Editor-in-Chief chelle Gan, Diana Marie Peralta, Julio Miguel Galvez, Kyle Dael, Nikki Laynes, Petrus Carb- Iris Gem Li Raisia Rojas onel, Kathrine Labrador, Richelle Lansang, Jo- Creative Director Dhioanne Hao seph Sinay Associate Editors for Publications Writers