Banking and finance
Media
Part of The American Chamber of Commerce Journal
- Title
- Banking and finance
- Creator
- Grant, C. V.
- Language
- English
- Year
- 1949
- Rights
-
- Fulltext
- America in defense of freedom, but appealed to America for a ‘redefinition of the fundamental attitudes toward Asia’ ”. "We are determined to carry on and fight to the last man on the side of America if freedom — our freedom and your freedom — should ever again be menaced and the democratic way of life imperiled... I have come to your country in ths furtherance of the mutual under standing between your country and mine: for the preservation not only of freedom and prosperity but. also of the peace of the world in our part of the globe. I hope this mightiest of legislatures in the world will give a timely and effective cooperation in our efforts to achieve a rich promise of understanding and enable us to contribute in our modest way toward the fulfillment of the high mission of the United States in the advancement and preservation of world peace and the security of all liberty-loving peoples.” (In the House.) "Today the most urgent problem that confronts the Philippines and other free countries of Asia is the problem of security. It is, in fact, the principal problem which besets all those states that lie athwart the advancing tide of Communism. The Philippines rejoices with the rest of the world for there, at least, has been erected a mighty bulwark against the advance of Communism in Europe. However, it is obvious to every one that the task of securing a free world is only half done. Asia, with its vast population which accounts for more than half of the total popu lation of the world and with its incalculable resources, can not and ought not to be lost to Communism by default. And yet this is bound to happen unless something of the courage and vision that went into the forging of the democratic defenses of Europe is applied through the forging of a similar system of defense for Asia. I feel very strongly that thr free countries of Southeast Asia and the Pacific must them selves start a movement toward closer cooperation and the furth»rance of their common interests in the political, economic, and cultural fields. No military commitments should be contemplated. It is my feeling that we still have time in the free countries of Asia to halt the advance of Commu nism by non-military means. The fundamental aim and purpose of the Pacific Union is to forge stronger ties of economic cooperation and collaboration between the free countries of Asia so as to enhance their prosperity, hasten the march of self-government, afford concentration in internal development, and to preserve their freedom..." (In the Senate.) Aug. 11 — The Department of Foreign Affairs orders the immediate evacuation from Canton and Amoy of all Philip pine nationals including non-essential dependents of members of Philippine diplomatic and consular staffs in these two cities. Aug. 12 (Washington date Aug. 11)—The White House releases a statement concerning the visit of President Quirino published else where in this issue of the Journal. President Quirino arrives in New York and receives a “gala welcome.” Aug. 13 (New York date August 12) —President Quirino at a banquet tendered in his honor by the Philippine-American Chamber of Commerce and the National Foreign Trade Council, issues “a direct invitation to American capital to come to the Philippines”. "Referring to reports on local attempts at nationalistic legislation and Huk activities. President Quirino said that these have been greatly exaggerated. Of course, all sorts of bills are always being filed by Philippine legislators, as elsewhere, he said, but these! do not necessarily reflect• public opinion, much less get enacted. As for the Huk problem, he cited the fact that he is able to go abroad as proof that there is nothing alarming about Huk activities. He concluded his talk by de claring that the Filipinos have always been friendly to America and will welcome active economic cooperation from Americans now and in the future.” Earlier in the day the President received the honorary de gree of Doctor of Laws from Fordham University. Malacanan announces the appointment of Marciano S. Ang eles as General Manager of the Insular Refining Corporation and as Manager of the Pulp and Paper Mill Department of the National Development Company. The Emergency Currency Board headed by Insular Treas urer M. Guevara announces that all registered emergency and guerrilla currency notes will be redeemed by the Government not later than September 9 of this year. Aug. 15 — President Quirino in a radio broadcast from San Francisco beamed to the Philippines by RCA states, with re ference to the honors and courtesies he has received in the United States: "All these public demonstrations are but fair manifestations of the high regard in >yh>ch America holds her Daughter-Republic in the Orient.” Aug. 17 — The Department of Foreign Affairs instructs the personnel of the Philippine liaison office in Canton to evacuate all non-essential personnel and all records to Hong kong. Associate Justice Gregorio Perfecto of the Supreme Court dies. Aug. 18 — The President returns to Manila and delivers a short address at the airfield expressing deep satisfaction with the results of his trip. Aug. 19 — The President signs an executive order making Butuan, Agusan, a national port open to coastwise trade. Announced that the air transport treaty with Thailand has been technically completed by the Philippine Air Mission. The Mission will shortly leave Bangkok for New Delhi. Aug. 20 — The President swears in Presiding Justice Luis P. Torres of the Court of Appeals as Associate Justice of the Supreme Court, replacing the late Justice Perfecto, and swears in also Justice Fernando Jugo, Associate Justice of the Court of Appeals, as Presiding Justice of that tribunal. Later in the day the President goes to Baguio for a rest. Announced that the resignation of Jose C. Zulueta as Acting Chairman of the Surplus Property Commission has been accepted, effective today. 242~ The President appoints Quintin Paredes. Jr. one of the Associate Commissioners of the Public Service Commissl?n- Since liberation Mr. Paredes has been provincial fisAug. 24 —President Quirino addresses the following ra diogram to president Truman: Allow me fo express my deep gratification over your formal an nouncement at Miami that thu Philippines is included in the United States military assistance program for Atlantic Treaty countries. Your speech has undoubtedly brought the United States closer to the hearts of p«£ples like ours whose national security is presently threatened by the advance of Communism. America’s stand in joining in the common defense of the rights of all mankind gives us renewed hope and confidence.” (Continued on page 407) Banking and Finance By C. V. Grant Sub-Manager, National City Bank of Neto York COMPARATIVE figures of assets and liabilities of the Central Bank follow: ASSETS (in thousands of Pesos) As of January 31 As of June 30 As of July 31 International Reserve ... Contribution to Interna tional Monetary Fund . Account to Secure Coinage Domestic Securities ........ Due From Treasurer of Philippines ................... Other Assets .................... P877.395 P714.969 P641,617* P573,031’ 30,000 30,000 30,000 113,106 113,306 113,306 — 9,739 10,354 _ 7,626 19,320 22,681 23,627 P824,969 P750.318 LIABILITIES Currency: Notes ............ P621.521 Coins .............. 73,035 Demand Deposits — Pesos 169,351 Dollars — Securities Stabiliza tion Fund ................. 2,000 Due to International Mo netary Fund ................. Due to International Bank for Reconstruction and Development ................. Other Liabilities .............. 1,408 Capital .............................. 10,000 Undivided Profits .......... P877.395 P824.969 P750,318 * The Demand Deposit Liabilities in U.S. Dollars are deposits of ths Treasurer of the Philippines. These amounts are included on the Asset sido as part of the International Reserve. A further substantial decline in the International Reserve occurred during July, which has focused con siderable press attention on the problem of the spreading gap between the value of imports and ex ports. While Import Control and a gradual decline in prices of some imported commodities, have brought about a drop in the monetary value of imports (main ly due to a decline by one-third since the end of 1948, 387 and a drop of 50% from a year ago, in the export prices of copra), the value of exports for the first 6 months of this year decreased by P66,000,000 com pared with the same period in 1948. This figure compared with the drop in value of imports of only P33,500,000. The other principal contributing factor to the continued decline in the International Reserve during July, was the comparatively limited amount of dol lars received from the U.S. Treasury, which funds cushion the effect of the adverse trade volume. On August 12, the Central Bank notified the banking community that the Secretary of Finance had issued a directive to the Treasurer of the Philip pines that henceforth the obtaining of a license from the Foreign Funds Control Office was no longer re quired for remittances abroad. Previously, such licenses were required for remittances in excess of $2,500 monthly for other than payments of imports. The Central Bank has recently released the fol lowing comparative figures for the period January through May, 1949. MONEY SUPPLY* Currency Deposit Net Money Total Deposits, National Savings Time Treasurer Deposits Deposits Year and Month 1948 Dec............ 526 607 ' 1,133 22 227 22 .1949 Jan............ 572 617 1,189 16 235 23 Feb............. 571 589 1,160 16 236 24 Mar........... 571 556 1,127 1,157 17 237 27 Apr............ 588 569 17 236 28 May ........ 552 549 1,101 16 237 28 Money supply consists of currency issued, _____ ___ ______ ______ .. ............................ .......... —...... banks; plua the peso checking-deposit liabilities of banks, excluding the national gov ernment deposits and interbank deposits but including unused over draft lines. During the past month there has not been any alteration in the rates at which the Central Bank buys and sells to commercial banks, nor in the rates between which the banks are permitted to quote to clients. For prime business, banks generally are quoting Telegraphic Transfers 201.25 selling, and 200.625 buying. Stock and Commodity Markets By A. C. Hall A. C. Hall Company New York Stocks. — The advance, which began on June 13, has continued to make headway during the past month, with chemicals, foods (including sugars), and oils amongst the best-acting issues. Leading automobile stocks showed little response to record-breaking first-half 1949 earnings. Steels marked time as Wall Street tends to await the report of the Presidential fact-finding board on the steel wage situation. As noted last month, monetary influences have continued to exert pressure toward lower yields for medium and long-term high grade bonds. This tendency is likely also to have a firming effect on the best quality common stocks. Market fluctuations during the period, as mea sured by the Dow Jones Averages were as follows:— July 2.1 High Low August 19 Industrials ............... 174.59 182.02 174.53 181.16 Rails ......................... 44 87 47.72 44.84 46.84 However, the movement of the averages is not too reliable a guide at the moment, as the market is a very mixed affair with numerous stocks moving against the trend of the averages, both on declines and advances. Recent business news indicates that with con sumption in many lines continuing to run ahead of output, inventories have been reduced to the stage that some shortages have appeared. This has resulted in satisfactory new buying and an increased rate of production in a number of industries. Other strong spots in the economy include the continuing high rate of automobile production and building construction. Offsetting these favorable factors in the business picture, are renewed wage demands in the steel and automobile industries. It is generally felt that fur ther wage increases or any prolonged strikes in ma jor industries at this time would seriously disrupt the progress already made toward a healthy peace-time economy. In the face of many uncertainties, it is not sur prising that financial opinion is very divided on the market outlook. According to Dow Theory, the cur rent advance is a secondary reaction in a primary bear market. A leading statistical service feels that the November-July business recession has only ac complished part of the readjustments which are need ed. On the other hand, another equally prominent stock review has held and continues to hold the view that the recession would be relatively mild and brief, although admitting the possibility that some jolts lie ahead before the economy gets out of the woods. It is the writer’s opinion, based on a study of the market action of a large number of individual stocks since 1946, that share prices, for the most part, have already completed their post-war adjustment, and, as usual, ahead of the business picture. However, ‘having advanced uninterruptedly for nine consecutive weeks, the market must be considered vulnerable to any unfavorable new developments in the near future. /COMMODITIES. — The Government report as of August 1, estimated a further reduction of 57,000,000 bushels to 1,130,000,000 bushels as total wheat production. It is anticipated that larger amounts will enter the loan than last year, thereby creating a tightening of supplies later on in the year. September Chicago Wheat was quoted at $1.98% against $2.02 % last month. There was a small in crease in estimated total production of Corn as of August 1. Cash demand continues good but abund ant supply is a depressing factor on Futures. Sept ember Chicago Corn was $1.21% against $1.29% the previous month. Cotton futures were slightly higher on good domestic and foreign demand with New York October closing at 29.85 as compared with 29.71 a month ago. The present sugar quota is caus ing a tighter statistical situation; September New York #5 Contract improved to 5.44 from 5.38 last month. MANILA Market. — There was a good followthrough to last month’s advance in well placed mining issues, but the sharpness of the advance car ried the market into an overbought position, and vul nerable to profit-taking latterly. An unfavorable de velopment during the past few days has been the slower demand for gold in the local market as a re sult of the deteriorating position in South China. 388