Tag Archives: government

Tit For Tat

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The Supreme Court issued ruling that would have allowed Arroyo to go overseas, supposedly seek medical treatment, and possibly escape the criminal charges against her. The Department of Justice blocked the departure of Arroyo and then had her arrested despite, or because of, this ruling.

Now with timing that looks suspiciously like childish spite, the Supreme Court has ruled that Hacienda Luisita, which happens to be owned by relatives of President Aquino, has to comply with the agrarian reform law (signed into law by the other President Aquino) and parcel the land to its farmers.

What’s the next episode?

PLDT DigiTel Purchase

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After long months, the purchase of DigiTel by PLDT was finally approved by the National Telecommunications Council (NTC). Of course there still are opposers particularly a congressman who cited Section 15 of Digitel’s franchise (Republic Act No. 7678), granted in 1994, which says that Digitel:

“…shall not lease, transfer, grant the usufruct of, sell nor assign this franchise or the rights and privileges acquired thereunder to any person, firm, company, corporation or other commercial or legal entity, nor merge with any other corporation or entity without the prior approval of the Congress of the Philippines.”

Okay, that’s fine since PLDT is buying DigiTel and not its franchise directly. But then it goes on:

“Neither shall the controlling interest of the grantee be transferred, whether as a whole or in parts and whether simultaneously or contemporaneously, to any such person, firm, company, corporation or entity without the prior approval of the Congress of the Philippines.”

This is interesting since it effectively means it is illegal to buy even a single part or share of DigiTel without prior approval from congress. So if you bought a share of DGTL you’re a lawbreaker. Nice.

The Math of Company Ownership

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The Supreme Court is at it again with their whimsical decisions. They have decided to change the rules in the middle of the game. They have decided that ownership is only achieved through common stock and not preferred stock. So with their new formula, PLDT is now 64% foreign owned. And the same goes for more than a few other companies.

How they came to that decision boggles me. A company is the sum of its assets. And assets are purchased with equity and possibly debt.

A = D + E

In accounting both common stock andpreferred stock are owner’s equity.

A = D + (CS + PS)

Debt is borrowed money and is paid off with interest. Equity is owner’s money and shares benefits from earnings via dividends or suffers from losses. And preferred stocks get first dibs at dividends. If you look at it this way, preferred stock is more ownership than common stock.

Now, if the company is to be dissolved and the assets liquidated or sold,

A = D + (PS + CS)

$$$ = D + (PS + CS)

Debtors collect first,

$$$ – D = PS + CS

$$ = PS + CS

followed by preferred stockowners,

$$ – PS = CS

$ = CS

and finally common stock owners.

$ – CS = 0

If you look at it this way, preferred stock is more ownership than common stock. In fact the only thing going for common stock is it’s decision-influencing attribute via stockholder vote.

SSScam

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Last Sunday, my dad, James, and I had a post-dinner discussion about Social Security Service (SSS) and I said it’s a scam or SSScam as I like to call it.

Based on a definition of a Ponzi Scheme: A Ponzi, or pyramid, scheme is a scam SSScam in which people are persuaded forced to invest through promises of unusually high returns by law, with early investors paid their returns out of money put in by later investors.

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Passport Renewal

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My passport was due to expire mid-year so at the start of the year, I applied for renewal at the DFA’s vaunted online system. I found that I can only schedule an appointment by the end of March. I learned later that there’s a 3-month lag time in appointments. No problem. I’ve no travel plans in the next few months so I set my appointment.

Wrong! Two weeks ago, I learned I’ll be heading off to Vietnam courtesy of the company! I estimated the delivery of the passport given my appointment and there was no way my new passport will be available by the travel date. Not good! Fortunately, the company has good travel agents. They were able to schedule me to an interview this morning (how, I don’t know). So there I was at DFA at 7AM on a weekend morning.

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