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OPINION: A book for banking and finance dummies

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John Paul 'JP' Tanchanco

<p>In this age of the Philippines&#x27; economic growth, amid major global changes, &quot;Central Banking for every Juan and Maria&quot; by Ignacio &#x27;Toting&#x27; R. Bunye offers wisdom for Pinoys around the world. </p><p>I was able to get a personal signed copy from the author himself and he shared with me some insights about his quest in educating the Filipino people from all market segments to know more about the value of money and central banking. </p><div><strong>A book for the finance illiterate </strong></div><p>&quot;Central Banking for Every Juan and Maria&quot; was authored by retired Monetary Board Member Toting Bunye to help improve financial literacy. </p><p>According to Bunye, the book is written specifically for people with zero to very little background knowledge on banking and finance. </p><p>&quot;The book focuses particularly on the functions of the BSP [Bangko Sentral ng Pilipinas] and how it affects the lives of the Filipino. I thought of the lay person and how they would better appreciate the BSP,&quot; said Bunye. </p><p>Bunye said he specifically made chapter 13, on Economic and Financial Education, palatable to every Filipino who would like to make sound financial decisions. </p><p>&quot;Whether or not he took economics or even if he is a school dropout, they would appreciate chapter 13 of the book,&quot; he said. </p><div><strong>The author </strong></div><p>Atty. Ignacio R. Bunye, also known as Toting, was former mayor of Muntinlupa, former chair of the Metropolitan Manila Authority (forerunner of MMDA), former representative of the congressional district of Muntinlupa, former press secretary, former presidential spokesperson, former acting executive secretary, and former political adviser.</p><div class="embed-wrap"><figure data-feedback="fb:likes,fb:comments"><img src="http://sa.kapamilya.com/absnews/abscbnnews/media/2018/news/06/16/b1.jpg"/><figcaption>Atty. Toting Bunye, JP Tanchanco </figcaption></figure></div><p>In fact, I remember in 2002-2003, I was about 22 years old, I was able to visit his office when I asked him for a recommendation for my internship at the Presidential Management Staff because I wanted to help our overseas Filipino workers (OFWs) and our country by creating a policy that would protect our economy thru the formalization of remittances flows while focusing on investment training of OFWs and their families for entrepreneurial activities. </p><p>Bunye was Monetary Board Member of Bangko Sentral Ng Pilipinas (BSP) from July 3, 2008 – July 2, 2014. He is now a board director of Bank of the Philippine Islands. </p><p>Bunye said everyone can and should appreciate the BSP&#x27;s work, which he explained in the book. </p><p>&quot;When I joined the Monetary Board of the Bangko Sentral on July 3, 2008, I started writing about the Bangko Sentral and the financial system in my weekly column... I had non-economists comment positively on the manner in which the content is presented... Economists and bankers may not like their work explained so simplistically, but as explained earlier, this book was written for a different audience,&quot; Bunye said. </p><div class="embed-wrap"><figure data-feedback="fb:likes,fb:comments"><img src="http://sa.kapamilya.com/absnews/abscbnnews/media/2018/news/06/16/b2.jpg"/><figcaption>MBM Bunye is sworn in by then-Governor Amando Tetangco of Bangko Sentral ng Pilipinas</figcaption></figure></div><div><strong>More about the Book </strong></div><p>The book was organized into 16 chapters that contain articles on various topics. </p><p>&quot;Some articles are pretty straightforward , while others come with a glossary or a question-and-answer portion to further explain the topic.... If you are an OFW or have a loved one who is, Chapter 5: BSP as implementor of an efficient payments and settlements system would be a good supplement to Chapter 13: Economic and Financial Education,&quot; said Bunye. </p><div class="embed-wrap"><figure data-feedback="fb:likes,fb:comments"><img src="http://sa.kapamilya.com/absnews/abscbnnews/media/2018/news/06/16/b3.jpg"/><figcaption>Aside from the Pinoys of his motherland, Atty Toting Bunye specifically dedicates his book to his wife Mira</figcaption></figure></div><div><strong>The Value of Money </strong></div><p>Among all the chapters, I think Chapter 11 and its section about printing money and its true value is important for everyone to grasp. </p><p>In this day and age of crypto-currencies, I personally think that Pinoys of all ages, especially those who are not as literate in economics, would appreciate how Bunye answers the question, &quot;Why don&#x27;t we just print more money?&quot; </p><p>&quot;Printing more money for everyone sounds cool. With more cash, we can buy more goods. But if it&#x27;s really that simple, why does the Bangko Sentral Ng Pilipinas strictly regulate the number of bills it prints?&quot; Bunye wrote. </p><p>The book further illustrates how money is printed and why the amount of money is regulated and managed by the BSP. </p><p>&quot;In essence, it was a case of too much money chasing too few goods (or in economic terms, inflation)... Printing more money than necessary would, therefore go against the BSP&#x27;s primary objective: To maintain price stability conducive to a balanced and sustainable economic growth,&quot; Bunye said. </p><div><strong>Economic and Financial Education </strong></div><p>Bunye&#x27;s chapter o economic and financial education can help Pinoys understand financial literacy and worth. I like that Bunye quoted Randell Tiongson&#x27;s blog entry that says Singapore has an average savings rate of 50% and the Philippines is only at about 12-16%. Tiongson says, &quot;It is unfortunate that many Filipinos have embraced a first world consumerism lifestyle but have a third world income. We simply do not save enough.&quot; </p><p>The book illustrates how the BSP has adopted financial literacy as an advocacy. &quot;By imparting the value of prudence and thrift to its target audience, the BSP hopes to transform a generation of spenders into net savers and investors.&quot; </p><p>The book also explains that an increase in incomes does not mean more savings, as the BSP recognizes the need to educate the public so that everyone is able to put income to good use. </p><div><strong>Here are some tips that Bunye&#x27;s book has on investing. </strong></div><p>Before investing on a financial product: </p><p>Get to know the financial product that you plan to invest in , especially the terms and conditions in fine print. Do not invest if you do not understand the product or any of its terms and conditions. </p><p>Do not be enticed by the promise of extremely (and improbable) high returns. Understand that the higher the return on investment, the greater the risk. </p><p>Avoid pyramiding investment schemes, including Internet-based ones, which urge and encourage investors to recruit others in exchange for more income. </p><p>Make sure that the actual investment product/instrument, if sold in the Philippines, is registered with the Securities and Exchange commission (SEC), or has prior approval of the Insurance Commission in the case of insurance products. </p><p>A Certificate of Incorporation from the SEC does not automatically mean that its investment products and instruments are authorized by the SEC. </p><p>Check the background of the issuing entity and the people behind it. Investment products issued by banks should be authorized by BSP. </p><p>Deal only with solicitors, agents and brokers licensed by the SEC, or with employees authorized by banks if the product is bank-issued. </p><p>Investment Products instruments are not insured by the Philippine Deposit Insurance Corporation (PDIC). Remember that only bank deposits are insured--up to Php500,000 per individual depositor by the PDIC. </p><p>Keep proof of payments such as official receipts, investment contracts, or certificates of participation in a safe place.</p><p>So, there you have it. Checkout Bunye&#x27;s book and get a copy. If you want to know more about the book, like Central Banking for Every Juan and Maria&#x27;s <a href="https://www.facebook.com/CentralBankingforEveryJuanandMaria">Facebook page</a>: </p><p>-----------</p><p>The author is a travel, food, party, film and music aficionado. He is also an economist, businessman, MYX/Awit award-winning media producer and Kala guitarist.</p><p>&quot;ThaGoodLife&quot; is a blog about pop culture, travel, music, entertainment, business, food, luxury, clubbing, shopping and events.</p><p>For questions, features and comments, e-mail him at jptanchanco@yahoo.comor tanchancotrimediaproductions@yahoo.com</p>

<p>"Central Banking for Every Juan and Maria" by Ignacio 'Toting' Bunye was written specifically for people with zero to very little background knowledge on banking and finance. </p>

"Central Banking for Every Juan and Maria" by Ignacio 'Toting' Bunye was written specifically for people with zero to very little background knowledge on banking and finance.