Despite Gold's setback, Local Pawnshops flourish

The setback in the price of precious metals have suddenly caused some analysts to wonder about the real trend. As soon as Jim Kramer, the host of CNBC's Mad Money made a recommendation about buying and investing in gold, and after Rick Santelli made a bullish statement about the metal's future, gold and other precious metals have started declining.

"If Kramer has predicted it, I'll do the opposite! I think the price of gold and other precious metals will eventually return to its upward trend after some minor corrections. Even so, I consider this setback as an opportunity to stack-up some more." one bullion trader commented.

Meanwhile, local pawnshops are flourishing amid the global financial crisis due to the rise on the number of borrowers desperate to raise needed cash for their daily needs. Pawnshop owners and lenders have reported that the increase of customers was due the rising unemployment and deteriorating economic conditions due to the rise of cost of living.



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Local authorities have again warned the public that smaller denominations such as 10 and 5 centavo coins should be spent and accepted by the local communities in order to avoid further inflation. "Hoarding or disregarding these coins means further lost to the current purchasing power of the peso and to productivity since our government allocate funds for the production and circulation of these coins." a BSP official explained.

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A Typical Day for a Filipino Numismatist

There were times in the life of a typical Filipino numismatist that he is about to give-up with his collection due to several reasons. Much of it because of the pressure from people dearly close to himself, and sometimes from the complicated system that seems to be in an endless entanglement from the ego and politics among hobbyists.


Ridiculed and frustrated he turns to his collections for divine answers and comfort, as he carefully hold each and every coin for inspection. He usually spend his pastimes looking at them and scrutinizing every details using his jewelry loupe in search of that particular characteristic that would usually help him identify each coin from others.

Luster, relief, toning, grade, and others are the aesthetic points he is familiar with and appreciate the dates and mintmarks more if that correspond to scarce varieties, low population, or mintage. He is usually quiet, isolated, and eccentric as he is regularly seen travelling on foot in the busy streets of Manila, in search of his own version of treasures.

He like the scenes of clutter, antiquity, dustiness, and imperfection as it represents opportunity, adventure, and excitement. The sidewalks, flea markets, and pawnshops are his turf and not the usual coin shops which, he considers as only for neophytes.

He usually walk alone and in most times in a hurry as he anticipate the principle of “timing” as his key to rare opportunities. He races against dealers, jewelers, and sometimes, fellow collectors in a hope to snatch some few bargains before somebody attempts to bid for a higher price.

At the end of the day, after the heart pounding dash and crafty haggling, he would usually settle for the leftovers, for reason that he either failed to compete or someone was early at the scene.

Yet despite of that never-ending frustration, he would still consider himself as passionate and committed in his quest of assembling that “Greatest Collection” one-day---the day that everybody will be envious, he told himself.

He sits in a corner at one of his favorite places in the Metro, making some quick glances at the pieces he gathered for the day before heading home. As he lift the coins one by one, his mind is already at work visualizing his next step, carefully planning the preservation and protection of his newly acquired treasures.

The planned itinerary rewarded him of a safe and early arrival. He quickly walked to that particular place in the house where he hides his collection. There he met his wife dusting the cabinets, and seems at the stage of putting the finishing touch as she smiled back, her feet on the newly waxed floor.

Then he asked for that box, “Where is it?” His wife answered “I threw it in the garbage!”

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Finest 1906-S One Peso offered at Stack's

The 1906 San Francisco mint 1 Peso enjoys the status as "King of Philippine coins" not because of its mintage, but because of the history behind it. There were more than 200 thousand of this coin produced dated 1906 aside from the proof coin minted by the Philadelphia mint. But because of the scarcity of silver and its importance to the economy of mainland United States, its former colony, the Philippines undergone several transition including the reduction of size of the United States colonial coins as well as its alloy. From the standard of 1 ounce, the Philippines adopted 3/4 of an ounce for the equivalent of peso in silver unit.

1 Peso, 1906-S. MS-62 (PCGS). This is the finest known example of the 1906-S Peso, accompanied by a partial Type Set of First Issue Philippine Coins. Students of the U.S. Philippine coinage estimate that perhaps only 200 1906-S Pesos survive today in all grades. Most have seen substantial circulation and have been cleaned. Even Extremely Fine specimens without a trace of original surface are routinely sold for a couple of thousand dollars and the few About Uncirculated pieces known are all five-figure coins. The few Uncirculated pieces known are the stuff of legend to the ever-increasing number of enthusiastic aficionados collectors of this historic series. The present 1906-S Peso boasts fully original, unaltered surfaces, lustrous flash beneath the handsome russet and blue toning shared by the other Silver coins in this historic group.

Stack's is proud to have been selected to introduce this example of the greatest rarity of the U.S. Philippine series to the collecting public! This is the first appearance of this finest known 1906-S Peso, MS-62 (PCGS). The population reports underline its rarity: PCGS has certified two in MS-61, two in MS-62; NGC has certified one in MS-60, one in MS-61.

Joining the Peso are the other three coins comprising this historic grouping, who have journeyed together for more than a century: * 1904-S 50 Centavos, MS-62 (PCGS) * 1903 20 Centavos, MS-63 (PCGS) * 1903 Bronze Half Centavo, MS-64 RB (PCGS). Here is a truly historic offering whose like may never be seen again. The possessor of this group will have custody of a unique window into the beginnings of American coinage for this unique Far Eastern possession. (Total: 4 pieces) (80,000-100,000)

During World War 2, most of the remaining 1906-S 1 Peso being held by the Philippine treasury were dumped in the waters of Manila bay as a drastic measure to avoid confiscation by the invading Japanese Imperial Army. Thus, only a few specimen survived in excellent condition including the one from the Golden Horn Collection.

This group of four exceptional coins was formerly the property of a Major in the American forces that "pacified" the islands in the early 1900's. He stored the coins in his Army footlocker, and there they were to remain for more than a century. The first, large-size coins were struck from 1903 to 1906 when skyrocketing silver prices had caused the Silver value of the Peso and minor coins to exceed their face value. The change-over to reduced sizes and weights took place during 1906, after the San Francisco Mint had already struck 201,000 Peso pieces. The Mint halted distribution after a very few coins were released. The balance of the issue was returned for melting and recoinage into the new small-size Pesos of 1907.

According to elder numismatists from the Philippine Numismatic And Antiquarian Society, Felipe Liao, a former officer of the club himself was the only known local collector who had acquired more or less than 40 pieces of the 1906-S 1 Peso, discovered only after his collection broke down after his death. Several of his prize possessions were donated by his heirs after his death to De La Salle University museum. -"quotes from coinarchives"

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Gold vs. Financial

The surge of investors flocking at the mint and coin shops during the time when there were not yet online stores around happened during the 1980's when Gold reached a record high. Such was the first time the modern world witnessed the natural instinct of man toward the precious metal. "A decade ago before that during the 70's, currencies backed by gold were replaced by the money what we know today as "paper currency" or "fiat currency" or money back by nothing except trust and confidence." an economist said.

Today, as the Global Financial Crisis devastate the world's economies, another round of panic grips the market as more and more people seek to preserve their wealth through the hoarding of this precious metal.

The combination of central banks spending trillions of dollars to prop up the banking system in the worst financial crisis since the Great Depression will cause gold to appreciate at least 17 percent this year from $882.05 an ounce on Dec. 31, surpassing the record of $1,032.70 in London, according to 16 of 24 analysts surveyed by the London Bullion Market Association. The metal rose to a three-month high of $927.36 today.

Investors are typically cautious about investing in Gold because of the bad experience after the 80's when the market started to stabilize. But this does not deter investors from accepting what has gold proven to the financial industry as it cemented its role as the number one choice against the surge of inflation.

Investors typically buy gold during times of financial turmoil as a store of value. The commodity has gained in five of the past six U.S. recessions.

Last year, manifestation of shortage has already been registered by the U.S. Mint as it suspended the sales of its gold bullion coins.

he U.S. Mint suspended sales of American Buffalo 1-ounce gold coins in September after supplies ran out. The Perth Mint, producer of so-called Kangaroo and Nugget coins in Australia, said in October that it doubled output in six months. Muenze Oesterreich AG, the Austrian mint, almost quadrupled production of its Philharmonic coin in the first nine months of 2008.

Investment demand for gold bars may climb 49 percent to 201 metric tons in the first half of 2009, according to London-based researcher GFMS Ltd. Frederic Panizzutti, senior vice president at Geneva bullion refiner MKS Finance SA and the most accurate forecaster in the 2008 London Bullion Market survey, said the peak will be breached before July.

Local financial firms have already expressed their vulnerability to the crisis, as Legacy Consolidated, a local pre-need company succumbed to bankruptcy. Investors told authorities that they were enticed to invest in the company because of the promise that their investment would double in a short period of time.

“Gold is the ultimate currency hedge,” said Michael Darda, chief economist at research company MKM Partners LP in Greenwich, Connecticut, who expects gold to surpass $1,000 this year. “If central banks are going to shovel massive amounts of paper out there, gold will ultimately respond to that.”

The firm which has an asset of Php300 million in asset, owes 1 billion pesos to its investors as their plans are beginning to reach maturity.

Bullion rose 11 percent in euros last year and 44 percent in British pounds, protecting holders of those currencies as the dollar strengthened. Gold reached a record in pounds on Jan. 23.

The gain in gold denominated in euros and pounds “represents a mistrust of global economies,” said Gerry Schubert, a director at Fortis in London.

Last December, a Citigroup senior officer predicted that Gold will surge to $2000 an ounce when the price was still under $800.

“It would be absurd to think that Bernanke would be able to nail a 1 to 2 percent Goldilocks inflation rate coming out of this,” Brynjolfsson said. “What you have is competitive devaluation of all currencies around the world. Precious metals are the only hedge in this kind of environment. The trend of gold over the next five years is a straight line toward $1,700.”

Based on the data garnered by the trading of Gold versus Financial companies, local investors could have taken more profit and less risk if they have invested it in Gold. But sad to say, not everybody else can see this change coming. - quotes are from Bloomberg

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Philippine Bullion Report: Gold up by $20 an ounce

Some of the worst effect of the global economic crisis were experienced this week, including the lost of 75,000 jobs in a single day mostly coming from the semi-conductor industry. Some local manufacturing companies located in the CALABARZON area like Matsushita-Philippines,a subsidiary of Panasonic electronics which manufactures batteries, and Dyna Images located in Cavite halted their operations in a single day.

Employees of the latter were only informed regarding the fate of their company on the day it ceased its operation. Economists are still expecting more layoffs and unemployment in the coming months as the crisis looms over the local economy.

Precious metals were the outstanding performers this week with Gold surpassing the $900 dollar mark while Silver is just a shy away from the $13 level despite of the uncertainty in the price of oil.

Gold futures rose Friday to their highest level in six months as investors sought the safety of the metal following government data that showed the U.S. economy contracted the most in 27 years during the fourth quarter.

Gold for February delivery was last up $19.90, or 2.2%, at $925 an ounce on the Comex division of the New York Mercantile Exchange. It rose to $928.10 earlier, the highest intraday level for a front-month contract since July.

Rising demand for the metal has pushed holdings in the SPDR Gold Trust, the biggest exchange-traded fund backed by gold, to a new record level.

The benchmark contract has risen 3.2% so far this week and 4.7% this month.

"Demand remains very high internationally for ETFs, gold certificates and bullion coins and bars," said Mark O'Byrne, executive director at Gold and Silver Investments. We've seen "continuing safe haven demand for gold" due to "sharp deterioration in the global economy."

Spurring the safe-haven moves into gold, the government reported that the nation's gross domestic product contracted at a 3.8% annualized rate in the fourth quarter. That shrinkage is the largest on record since the first quarter of 1982.

Most economists expected that GDP would shrink at a 5.5% annual rate.

However, the decline would have been worse except that the government counts an unwanted buildup of goods on store shelves as growth. Excluding the inventory buildup, GDP contracted at a 5.1% pace. - Marketwatch

The local supply of silver and gold coins have dramatically decrease for the past days due to the increasing demand on bullion coins, as professional investors and businessmen engage into the hobby of collecting coins as an excuse to safeguard their wealth.

Still, the price of coins has not increase yet, though demand have made the inventory of dealers limited to few loyal customers.

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Coin collector in Batangas adorns home with rare finds

Different kinds of ashtray, wine and perfume bottles, key chains, postage stamps, utensils, and all sorts of figurines are just among Rodolfo Punzalan’s collections that adorn his house in Bauan, Batangas province.

He was still a child when he started collecting coins and became a devoted coin collector since the 1970s. From coins, he soon became fond of collecting other items.

The 62 year-old collector, who works as an auditor for the Commission on Audit in Batangas City, could no longer count how many money he has so far collected.

Some are placed in frames while some are kept in coin albums.

His coin collections include money from centuries ago and from different countries. In fact, he has a one dollar Marilyn Monroe coin and a coin exclusively for lepers. He also has a keepsake of paper money used exclusively in some provinces during the old days.

Other collections

He also collects rosaries, one of which is made from santol fruit. He buys most of his collections. Some are given to him while some he won in fairs.

He admitted that initially his children would disagree with this past time. They have gotten used to it now that they even helped him collect new items, he said.

Antique items such as flat irons, wooden basins and rice containers are also among his treasures. His collections have become varied that sometimes school children would visit his house as part of their educational field trip.

The collector said his hobby brings him an unexplainable happiness that he would rather stay home and just look at them. Currently, Punzalan is looking for chessboards and belt buckles to collect. By SARITA KARE, ABS-CBN Southern Tagalog

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4 students claim to have dug up old Japanese bills, gold coins

Four elementary students in Jaen, Nueva Ecija, a province located a hundred of kilometers up north of Manila reportedly dug a box containing several Japanese paper money and gold coins. Report says that the students were called by a school teacher when she found that the four students were playing their with finds. One of them claimed that among the notes and the coins were pieces of documents which were written in unknown characters and in red ink. "I tried to erase it, but the red ink won't go." one of them added.

The school teacher explained to the media that she did not see any gold coins among those she confiscated. "Those were included in the hoard were just play money," she explained.

Video courtesy of GMANews.tv

The students added that their teacher told them to throw away the box afterward. One of them said that they dug the box at the school yard while they were playing. When they opened the box, they thought that the coins and money inside were just play money since they don't recognize it. They used the coins as a substitute for pebbles used for playing a local outdoor game.

Meanwhile, the children said that their teacher left them only with the paper money, which they later showed to the media.

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Ilocos Norte residents warn on P1-coin hoax

The Bankers’ Association in Ilocos Norte are warning the public not to believe rumors that a one-peso coin could be exchanged for a higher amount of cash.

The bankers’ advisory came out as rumors spread in the area that a one-peso coin dated 2004 could be exchanged in banks for P20.

Ronald Mandac, Bankers’ Association director, said that there were many who believed in the rumor and flocked to banks asking how their coins can be exchanged. He also said there was no directive from Bangko Sentral ng Pilipinas on the supposed exchange issue.

Mandac said however that he believes the issue is related to another rumor which said that the 2004 one-peso coin supposedly contains silver and bronze.

Authorities claimed that not only a few residents of Laoag City collected 2004 one-peso coins hoping that it would be exchanged for the higher amount of cash.

Similar rumors have been spreading most likely in the rural areas not only of the present day one-peso denomination. Rizal head peso minted during the time of President Marcos, known to many as "The Large Peso" has its own version of myth.

Some says that Marcos hid his gold on these coins, the reason why the coin has its yellowish color. Most likely, they added "it can be found in coins dating 1971", which is actually a non-existent date.

Even the 10-peso is not spared from the series of gossips. Some speculate that the core of the coin has gold in it, and the metal is abundant only in the coin minted in the year 2000.

The millennium peso is scarce though, but BSP officials assure that there is no gold in it.

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Anti-counterfeit Campaign: BSP Revised Reward System "Bayani ka na, magkakapera ka pa!"

The BSP Reward System, launch Anti-Counterfeiting campaign that, encourages the populace to furnish information on person/groups responsible for the manufacture/passing of counterfeits. This nefarious activity can be more effectively suppressed with the cooperation of the public.

There is a Committee on Rewards who shall determine the amount of reward in accordance with certain rules and regulation as approved by the Monetary Board.

Any person who voluntarily gives definite and sworn information leading to the the arrest/prosecution of a person or group of persons engaged in counterfeiting/passing of Philippine notes and coins or foreign notes and coins acceptable to BSP may qualify for the reward except however, officers or employees of the BSP or any intelligence or law enforcement agencies such as NBI, PNP, BIR, Bureau of Customs, including their relatives within the 3rd degree of consanguinity or affinity.
Recent introduction of counterfeit coins and notes have resulted to major changes in the production of coins and upgrade of the security features of the local currency especially high denomination notes such as 200-piso, 500-piso, and 1000-piso.

"The latest printing technology and other high end software have enabled counterfeiters and forgers to produce more complicated counterfeits. That is why the BSP has required its departments to harness all available resources to halt further damage to our monetary system." a BSP official explained.

"We don't want to experience the same setback when we first encountered the fake 5-piso and 10-piso coins which were only detected when much have been already introduced to the local economy. We did not anticipate such incident because we thought only coins of higher exchange rate such as the dollar, euro, and yen are vulnerable for counterfeiting. We have underestimated the intrinsic value of our own coins." He added.

Any person who has information on counterfeiting activities, may call the Investigation Staff, Cash Department at Telephone Nos. 926-5092 or 929-7071 local 618.

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Obama coins failed to capture the taste of local collectors

The "Obama Fever" has failed to capture the taste of local coin collectors unlike of that when the "Harry Potter" coin series and commemorative medals appeared at the local market.

The United States and the rest of world (particularly the African country, Kenya where Obama traces his roots) recently have their own versions of celebrations to welcome the first African-American President on his first official day at the White House as the 44th President of the United States.

Local Ebay sellers, bargain seekers, collectors, and speculators have their own respective opinions why buying or selling Obama memorabilia and mementos is a definite one of a lifetime opportunity.

"One local Ebayer explained that, Obama's charismatic appeal and popularity are two special aspects why collectors rush toward Obama Mania."

"Most known personalities and celebrities made their mark in our history using these equities (trademarks)."

This official Obama coin depicts Barack Obama's bust over the nation's capital and is encircled by the legend "Barack Obama" along the upper rim. (See picture for details)

The Democratic Party placed an order with the Winston Elizabeth & Windsor mint in England for about £100,000 ($156,000) worth of silver Obama coins to be used as gifts for Party supporters. The silver Obama coins, which were made from specially-designed dies, were issued in a numbered limited edition of 300 coins. If you were lucky enough to have received one of these official Obama coins, you just might have a collectible with some potential to increase in value over the years!

The colorized and the silver plate Barack coins that are selling on Ebay are not the same as the official Obama coin. Don't be mistaken that this coin is the real deal, "one collector says". The Obama coins which use a Presidential Dollar for the host coin are colorized through the application of a decal, which is permanently fused to the coin's surface using a hot glue process. In doing so, these marketers are wiping out the faces of our nation's Founding Fathers and placing their garish colorized designs on our U.S. legal tender coinage. The result is a coin that is numismatically worthless; in other words, these colorized Obama coins will never have any value to coin collectors as collectible Presidential Dollars because the original surfaces of the coins have been destroyed by the colorization process, as one Obama collector commented.

These Obama coins are being sold for prices ranging from $9.95 plus shipping (total: $14.90) to nearly $30 each, and all they really are is defaced Presidential Dollars that you can get for $1 at the bank comapred to the official silver Obama coins, which were made from specially-designed dies, and were issued only in a numbered limited edition of 300 coins.

The news regarding this fraud spread into the local numismatic clubs thus, most local collectors have restrained from buying any of these coins to discourage counterfeiting and forgeries which has already plagued the local coin market.

"Besides, being a limited edition, numbering only in 300 to 500 pieces. It can be comparable to a lottery win if a local collector could even acquire one!" One numismatist explained.

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BSP tightens regulations to prevent more bank failures

The Bangko Sentral Ng Pilipinas will release new regulations aimed to penalize and restrain “aggressive banking" tactics.

Besides setting clear definitions of “aggressive banking," the Bangko Sentral ng Pilipinas (BSP) will issue a circular that will impose harsher penalties on banks who plan to cheat their depositors.

“The new guidelines clearly define instances or acts of unsafe and unsound banking practices so that there can be no doubt the regulations have been violated and the banker punished," BSP deputy governor Nestor A. Espenilla said.

The new set of rules define “aggressive banking" as giving loans to borrowers that have poor credit histories by extending their interest rates without much protection for such risks.

Operational standards – as set under the new rules – will make “aggressive banking" extremely difficult since off-market interest rates are going to be defined as more than 50 percent of the median market rate.

“The guidelines in past circulars were implicit. In the new guidelines the rules are now clearly spelled out," Espenilla said.

Aiming to prevent a repeat of recent rural bank failures that have disenfranchised thousands of depositors, new central bank rules have disallowed banks from offering deposit and loan rates that are too high and accepting risky borrowers.

The Monetary Board last week approved Circular 640, which amends a directive issued in 2002. The latter, Circular 341, contains the implementing guidelines of Section 56 — “Conducting Business in an Unsafe or Unsound Manner" — of Republic Act 8791 or the General Banking Law of 2000. Its annex, which Circular 640 amended, lists the activities considered as unsafe and unsound banking practices.

The old annex listed “excessive reliance on large, high-interest or volatile deposits/borrowings" as one of these practices. The amendment restates this to “excessive reliance on large, high-cost or volatile deposits/borrowings to fund aggressive growth that may be unsustainable."

The Monetary Board defines “high-cost" as an effective interest rate on deposits or borrowings that is 50 percent higher than the prevailing market median for similar banks.

Aside from high interest rates, the Bangko Sentral ng Pilipinas (BSP) will examine how deposits were obtained, in particular if a bank resorted to offering noncash incentives worth more than the deposits or if the bank accepted the money outside its premises without central bank authorization.

Last year,PDIC seized 13 rural banks belonging to or affiliated with the Legacy conglomerate on account of unsafe and unsound banking practices, insufficient assets to cover liabilities, and poor liquidity. The Legacy banks had been known to lure depositors with a 20 percent interest.

Recently, heavy withdrawals by panicky depositors brought down two Pampanga-based rural banks this month. All 15 banks have since been placed under the receivership of the Philippine Deposit Insurance Corp. (PDIC).

Rural Bankers Association of the Philippines (RBAP) President Tomas S. Gomez IV said the organization “fully supports" the latest BSP circular.

“It further strengthens depositor protection and is consistent with the BSP’s mandate of prudential regulation. Coupled with PDIC charter amendments ... the revised circular will further strengthen the Philippine banking system," he said.

Circular 640 also expands the list of circumstances that comprise “hazardous lending and lax collection."

One is a high incidence of spurious loans because of poor risk management systems. Another is a high number of borrowers with poor credit histories or a high number of loans that are either unsecured or backed with minimum collateral values. A third is high loan rates designed to compensate for the risks attendant to these type of borrowers and loans. “High" is defined as effective interest rates that are 50% higher than the prevailing market median.

Also, “operating in a way that produces a deficit in net operating income without adequate measures to ensure a surplus in net operating income in the future" constitutes an unsafe and unsound banking practice.

Circular 341 allows the Monetary Board to issue cease and desist orders to banks and to impose a fine of not more than P30,000 per day per transaction, among other sanctions.

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Rising Dollar, Plummeting Gold, and Counterfeits

Gold prices went down on Thursday, closing low for the fourth straight day as the dollar's climb against other major currencies losing its appeal to most metal investors.

Meanwhile, Oil prices dropped to its former level of $35 while agriculture futures were mostly lower.

The dollar was stronger against the euro and the Japanese yen, and gained against the British pound earlier in the trading day, but pulled back slightly later in the session.

The gains in the dollar came after the European Central Bank slashed its benchmark interest rate by half a percentage point to 2 percent, as expected. The cut follows the Bank of England's move last week to reduce its interest rate to 1.5 percent. Lower interest rates can help spur spending and boost an economy, but they also have a tendency to undermine local currencies as investors seek higher returns elsewhere. Rate cuts around the world have subsequently roused the dollar in recent weeks.

Gold for February delivery lost $1.50 to settle at $807.30 an ounce on the New York Mercantile Exchange. The contract has lost 5.6 percent this week.

March silver fell 3.5 cents to $10.44 an ounce, while March copper futures fell 3.4 cents to $1.4535 a pound.

The yield on the benchmark 10-year Treasury note, which moves opposite its price, slipped to 2.19 percent from 2.20 percent late Wednesday.

Oil prices tumbled on the Nymex, after OPEC cut its 2009 energy demand forecast. The Organization of Petroleum Exporting Countries said in its January report it expects world demand for crude will fall 180,000 barrels per day in 2009, compared with the previous year.

Light, sweet crude for February delivery fell 5 percent, or $1.88, to settle at $35.40 a barrel, after falling to as low as $33.20 earlier in the session.

In other Nymex trading, gasoline futures rose less than a penny to settle at $1.1742 a gallon, and heating oil rose 2.4 cents to settle at $1.4871 a gallon.

Local bullion buyers are still warned of the proliferation of counterfeit crowns suspected to have came from Chinese syndicates. Although the local price of silver and gold bullion coins have plummeted in the past months. Supply are still hard to come by as local Dealers struggle to meet demand from the recent "run on precious metals" by businessmen who were seeking investment safe haven.

Most of these counterfeit coins are being offered in hoard or mixed with original coins to avoid suspicion.

Counterfeit coins are not easy to detect especially nowadays that counterfeiters have perfected the exact weight of the original coins. However, one definite sign to look for is the pristine condition which is very unusual for 100 year old coins that can be found in hoard.

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Special Economic Report: BSP forecast more bank mergers

The Central Bank is expecting further consolidation among local banks, with Bangko Sentral ng Pilipinas (BSP) Governor Amando M. Tetangco, Jr. sticking to his goal of five to six local banking groups dominating the sector.

"I still think five to six local banks plus the branches of foreign banks holding about 70% of the total banking system’s assets would be ideal," Mr. Tetangco told reporters in an e-mail.

"The BSP’s role is to create a working environment that would encourage banks, through market-based policies, to take advantage of opportunities to consolidate or expand as would suit their risk and profit appetite as well as their own overall assessments of the economy," he added.

Central bank data as of September last year showed there were 18 head offices of universal and commercial banks, three subsidiaries of foreign banks and 14 branches of foreign banks. There were also three government bank head offices.

Data also showed that universal and commercial banks continued to corner around 90% of the banking system’s assets at the time.

Since he took the helm of the central bank in 2005, Mr. Tetangco has been supportive of mergers among major banks, saying the BSP would rather have less but stronger banks.

The local banking sector saw a series of mergers and acquisitions in the past few years, among them the Ayala-led Bank of the Philippine Islands-Prudential Bank merger in 2005, the International Exchange Bank-Union Bank of the Philippines merger in 2006 and the China Banking Corp.-Manila Banking Corp. merger in 2007.

The merger between Sy-led Banco de Oro Universal Bank and Equitable PCI Bank, also in 2007, was hailed by industry observers as a landmark transaction as this created the country’s largest bank in terms of assets.

The industry is now awaiting the merger of two Lucio Tan-controlled banks, Philippine National Bank and Allied Banking Corp., which would create the fourth largest bank. — Gerard S. dela Peña

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Project 2009: The Philippine Coin Expo

The Philippine Numismatic & Antiquarian Society once played a vital role in the exposition, exhibition, and conservation of materials particularly those in connection with the nation's history.

The rift between the factions involved in the control of the organization led to the decline of its popularity among collectors specially during the times that major figures of organization had been dragged in the one of the biggest heist in the organization's history since it was created in 1929.

Now, several collectors and others (including this site) who want to reform the organization have expressed support in the creation of the Philippine Coin Exposition that will be prioritized this year of 2009 as part of the 80th year founding of the Philippine Numismatic & Antiquarian Society (PNAS).

The organizers of this exposition are planning to source out the funding from several contribution, donation, and fund raising scheme outside of the administration of the PNAS. This is to signal that such move is gearing toward the propagation of the interest in numismatic and collections and not of political issues and partisanship.

As part of this major move, the proponents of this change have even expressed their willingness to donate a website that would serve as the forum and announcement board for the PNAS, to reach out those who are interested in expanding their knowledge and collection, and otherwise as a tribute to the founding fathers of the organization.

One of the major vision of this movement is to help the organization in the creation of a library and a museum that would house several numismatic collections. This is to aid the local collectors in the maintenance and protection of their collection and otherwise discourage exportation of historical and numismatic treasures. Another, is to educate the local collectors and hobbyists regarding the proper handling, preservation, and identification especially right now that counterfeit materials have become a major hindrance for newbies in building their respective inventories.

Further announcements will be made through this site later.

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Philippine Bullion Report: Precious Metals alongside Energy & other Commodities Gain

Precious Metals: Gold, Silver, & Platinum

Precious metals and grains gain alongside energy prices last Friday trading, after a nine-day plunge in oil that shifted investors position to buy back into the ailing commodities market.

But so far, there is doubt that crude oil or other battered commodities are in for a consistent rebound. The labor market remains bleak, international trade is plummeting, and holiday retail sales were lower than forcasted. All these signs point to lower demand around the globe.

Gold has been performing better than other commodities. On Friday, gold for February delivery $23.00 to settle at $871.20 an ounce on the New York Mercantile Exchange (NYMEX).

Precious metals and grains gains alongside energy prices last Friday trading, after a nine-day plunge in oil that shifted investors position to buy back into the ailing commodities market.

But so far, there is doubt that crude oil or other battered commodities are in for a consistent rebound. The labor market remains bleak, international trade is plummeting, and holiday retail sales were lower than forcasted. All these signs point to lower demand around the globe.

Gold has been performing better than other commodities. On Friday, gold for February delivery $23.00 to settle at $871.20 an ounce on the New York Mercantile Exchange (NYMEX).

The precious metal is traditionally viewed as a safe investment in turbulent times. Its price plummeted as hedge funds and other large investors were forced to sell assets to raise cash, but the metal has been recovering from its mid-November lows as the economy and US dollar fall.

On Friday, the dollar slipped against the euro, but gained against the British pound.

Grain prices have also been advancing over the past few weeks on the Chicago Board of Trade, and extended their gains on Friday.

March wheat futures rose 17 cents to finish at $5.9925 a bushel, while March corn futures rose 14.25 cents to close at $3.98 a bushel. March soybeans rose 37.5 cents to settle at $9.565 a bushel.

Energy and industrial metals were not far behind. But they gained on Friday, despite news from Japan that industrial production sank by 8.1 percent in November — the worst monthly drop in more than 50 years.

Light, sweet crude for February delivery advanced $2.36, or more than 6 percent, to settle at $37.71 a barrel. US markets were closed on Thursday, and on Wednesday, crude prices had fallen for the ninth straight day.

In other Nymex trading Friday, gasoline futures rose 5.17 cents to settle at 88.4 cents a gallon, while heating oil rose 4.67 cents to settle at $1.245 a gallon.

March copper futures added 2.95 cents to close at $1.3035 a pound.

March silver gained 18 cents to close at $10.53 an ounce.

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Proposal for Scrapping Lowly Coins Denied

Philippine current low denomination coins

Scrapping coins whose values fall below one peso would be impractical for the Philippine government and unfair to consumers, a government official said on Thursday.

The government will also be unable to switch to a purely paper currency system because paper “has a shorter lifespan," the official who refused to be identified told GMANews.TV.

The official was prompted to issue this statement after Representative Roilo Golez filed a resolution urging the House Committee on Banks and Financial Intermediaries to conduct an inquiry regarding the “practicability of retiring and demonetizing the centavo as a Philippine currency."

House Resolution No. 898 also proposes to “round off cash transaction values to the nearest peso."

“Despite the number of coins issued in circulation, demand remains unfilled in many parts of the country because these coins are not being recirculated, or used regularly by the public but instead are kept inside bank vaults, piggy banks, inside drawers, used as washers, or even thrown away as inconvenience," the resolution said.

However, the official pointed out that while it is more expensive to produce coins, keeping them in the system is in accordance to the law.

Lower denominated coins also serve many consumers who buy inexpensive items, the official added.

The source said a 25-centavo coin costs as much as 80 centavos, depending on the price of metal in world markets.

Meanwhile, SM Hypermarket, which operates the SM Group’s hybrid department and supermarket store, said it sees no unfavorable effect should the said House Bill become a law.

The group has been thinking of ways to solve the problem of giving their customers the exact change for their purchases, Robert Kwee, SM Hypermarket executive vice president, said in a telephone interview.

“On our own, we're trying to find ways to eliminate the change because we've been getting complaints," he said.

Kwee noted that there were instances when the store is forced “with its back on the wall" because even banks had run out of coins.

He said that there were times when they were forced to exchange sweets and sweeteners with coins or even reward points to appease irate customers.

Itong dela Eva, IT Head for SM Food group, agreed.

“We don't see any problem with the proposal," she said.

However, Kwee cautioned lawmakers from rushing the proposal, saying that customers must first be consulted about it.

“My only suggestion is that we also get the side of the customers because some of them will still want to be given exact change," he said.

SM Hypermarket is seeking to build its 12th and 13th stores in the country. - GMANews.TV

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The 1972 Marcelo H. Del Pilar 50 Centavos Trial Piece in Copper

The 1972 Marcelo H. De Pilar Trial Strike in Copper

During the introduction of the new coins and the second term of then president Ferdinand Marcos in 1966, several pattern coins were created by then prominent medal designer and a former member of the Philippine Numismatic & Antiquarian Society (PNAS), Jose Tupaz Jr. Among the known varieties by Jose Tupaz, Jr. were coins which featured the first couple heads, the former president, the pope & the former president, and the national hero Juan Luna, which surprisingly, was the only hero included in the project. The patterns were later refined and the official coin set was released in 1967, which replaced the old design, which was still adopted from the original design of Melchor Figueroa.

Some lead splashers of these patterns were also made, one of them is in the hand of a prominent dealer who made it as one of the display attraction in his shop. Though, not a single trial piece was reported to have existed when the mass productions were already started, there were clues however that the mint made trial pieces since during that same design transition, another major changes occurred.

By way of proclamation of Martial law (RA 1081) on the 21st of September 1972, Marcos implemented a vision for the new republic that would particularly unify the Filipinos for the coming changes in the future. He called this project “The New Society”, or Ang Bagong Lipunan, a model society that would uplift the lives of the Filipinos through unification. The campaign was massive that he vetoed that such slogan would be inserted and carried out though the daily lives of the Filipinos, including the monetary system itself.

Marcos already implemented the gearing of the society toward patriotism where Tagalog was adopted as the national language. The former seal of the Republic which bear its slogan in English was replaced by a new Tagalog version including the name of the Central Bank which was altered to Bangko Sentral Ng Pilipinas.

Recently, a final trial piece in copper of the 50 centavos that bears the portrait of Marcelo H. Del Pilar surfaced. This is the final die trial before the die was finally destroyed and discontinued. Amazingly, the piece survived without much deterioration because it was covered in glue when it was first found. The coin is dated 1972, the last date of the 50 centavos denomination before it was discontinued to be produced in 1975. Only after the end of the regime, that the 50-centavos denomination was again introduced at the time of President Corazon Aquino.

Whatever the reason why the “The New Society” or Ang Bagong Lipunan never continued the production of 50-centavos remains trivial and mysterious. Yet, during the time of the New Society that gold coin production was resurrected after more than a hundred years hibernation, which made it as one of the most exciting period of Philippine numismatic.

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Oil & Gas In A Special Coin

The Malampaya Commemorative Coin

The Malampaya Gas production rig located near Palawan is the of the country’s pride in energy independence. Brought by the surging cost in oil importation, refining, and distribution, several exploration attempts in the early 80’s and late 70’s confirmed that the nation has a potential source of natural gas and oil.

A study undertaken by University of the Philippines Professor Dante B. Canlas, the former chief of the National Economic and Development Authority (NEDA). Using natural gas royalties would cut power costs which may stimulate economic growth since it will make local industries more competitive.


The Electric Power Industry Reform Act (EPIRA) which indicates that royalties that could be collected from “the exploitation of all indigenous sources of energy including natural gas and geothermal steam" would be used to cut power costs. This will provide government additional tax and non-tax revenues, which would be more than sufficient to offset the foregone royalties collection. Thus, the project started and had been one of the top priorities of several administrations.

In October 16, 2001 Malampaya platform was formally inaugurated by the current president Gloria Arroyo and other local & foreign business figures. A special commemorative coin produced by the Central Bank Mint was issued to celebrate this special event. This coin weighs 16 grams and 32mm in size and is made out of .999 silver and plated with a 24 Karat gold. However, the mintage is deceptive since there was no official record on the mint, which indicated the number of coin produced. But what is certain that this were only given to officials who have attended Malampaya’s exclusive inauguration.

The special coin or more specifically, the special token comes with a wooden box with the emblem of Malampaya, which is otherwise featured, on the coin’s obverse. The existence of this special token has not been known until recently which concludes how few were produced for this exclusive event only.

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Gold, Platinum Drop on Concern Recession May Lessen Demand on Metal

Gold futures fell on speculation a global recession will damp demand for precious metals and other raw materials. Platinum and silver also declined.

Equities in Asia, Europe and the U.S. fell today. More than $28 trillion in value has been erased from global equity markets this year as banks have posted more than $920 billion in credit losses and writedowns. The Reuters/Jefferies CRB Index of 19 raw materials is down by almost a third this year.

``We're back to focusing on the recession,'' said Leonard Kaplan, the president of Prospector Asset Management in Evanston, Illinois. ``You're seeing a bear market in everything. Gold traditionally does better than anything else in this recessionary environment, but it still goes down.''

Gold futures for December delivery fell $13.70, or 1.8 percent, to $732.80 an ounce on the Comex division of the New York Mercantile Exchange. The metal has dropped 29 percent from a record $1,033.90 in March.

Platinum futures for January delivery fell $33.30, or 3.9 percent, to $826.60 an ounce on the Nymex. The metal, used in jewelry and pollution-control devices in cars, has tumbled 64 percent from a record $2,308.80 on March 4.

Last week, General Motors Corp., the biggest U.S. automaker, reported a $4.2 billion third-quarter operating loss and warned it may run short of cash by the end of June. Ford Motor Co. reported a $2.98 billion loss in the quarter.

`Slammed'

``Nobody's going to buy cars,'' Kaplan said. ``You'll see platinum trade $100 to $250 lower than gold. It happens in every recession. Platinum is industrial, and catalytic converters and jewelry are going to get slammed.''

Platinum, palladium and silver have wider industrial uses than gold. Gold has dropped 13 percent this year. Silver is down 34 percent, and platinum and palladium has slumped more than 40 percent.

Gold may rebound to $800 in the next three months on investor demand for a haven from market turmoil, UBS AG analyst John Reade said.

``Interest in gold coins remains strong, with coin shortages apparent in many markets, while kilobars, one of the most popular investment categories, are trading at a high premium to the spot gold price due to long waiting lists at refineries,'' Reade said in a report.

A one-ounce Krugerrand coin from South Africa cost almost $37 more than the per-ounce spot price of gold today.

The U.S. Mint said this month it has resumed taking orders for American Buffalo 1-ounce gold-bullion coins after a surge in demand depleted supplies in its vaults.

Silver futures for December delivery fell 41.5 cents, or 4.1 percent, to $9.805 an ounce today on the Comex. Palladium for December delivery fell $2.75, or 1.2 percent, to $219.25 an ounce on the Nymex. - Bloomberg

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High-grade gold, silver found in S. Cotabato

A Canadian mining exploration company has found high-grade gold and silver deposits at a mining site in T’boli, South Cotabato.

Cadan Resources Corp., which operates the Tboli gold-silver project through Philippine affiliate Tribal Mining Corp., said the mine site might contain 584,000 tons of mineral deposits with 10.2 grams of gold and 50 grams of silver per ton.

In September, the company estimated mineral resources at the site at 420,000 ounces of gold and 1.6 million ounces of silver. It pegged the grade at 5.5 grams of gold and 21 grams of silver per ton.

"The latest higher grade results continue to indicate that the Tboli gold-silver resource not only appears to be larger in area. The grade also appears to be higher than [the earlier mineral resource classification]," Tribal Mining President Edgar D. Martinez said.

In a statement, he noted that there had been minimal surface exploration activity within a 400-meter area. Previous tests in the eastern side of the resource ranged from 13.37-81.14 grams of gold per ton, he added.

Tribal Mining obtained a permit to continue its exploration activities on Sept. 9 for potential development of the Tboli gold-silver project.

Canadian miner Cadan, which used to be known as Sur American Gold Corp., started underground development of the T’boli gold-silver deposits sometime later to determine the quality and quantity at the site.

The company’s mine development site straddles an area earlier contested by a native clan and a local cooperative.

The Maguan clan has sought clearance to mine the area of the T’boli Minahang Bayan Multipurpose Cooperative, which supposedly forms part of its ancestral domain claim. Consisting of small-scale mining operators, the cooperative has asked a local court that 21 hectares of a gold-rich portion of the village of Kematu in T’boli town be set aside for its exclusive use.

The land, however, forms part of the 85-hectare mining area granted by the government to Tribal Mining under a mineral production sharing deal.

Mines and Geosciences Bureau Regional Director Constancio A. Paye, Jr. said the dispute between the cooperative and Tribal Mining is separate from the claims of the Maguan clan.

Former South Cotabato Governor Hilario de Pedro III has issued an executive order apportioning the 21 hectares as the "people’s mining site" to address the row.

Mr. Paye said about 20 to 30 tunnels have been dug by cooperative members at the site over the years. — Romer S. Sarmiento, BsuinessWorld

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