A 2002 column I wrote

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One of the frustrations about writing a column that champions national progress is that nothing good ever happens. It is like shouting at the moon. No one really hears or listens.

My friend, John Mangun, reminded me that back on Sept. 9, 2002, or about 24 years ago, I wrote a column in The STAR entitled: Is PSE basically a bad stock market?

Well, reading it made me feel nothing much changed for the better from 2002 to 2026. Not in the stock market. Not in the country.

For perspective, in 2002, the Philippines had a significantly larger economy than Vietnam, with a GDP about twice the size of Vietnam. However, Vietnam was growing faster and in no time, we were eating their dust.

Vietnam’s focus on rapid industrialization and export growth allowed it to catch up and eventually surpass the Philippines. We were busy with political drama, then as now. We were and still are, happy to send our workers abroad.

Gloria Macapagal Arroyo, with a PhD in economics, was our 14th president from Jan. 20, 2001, to June 30, 2010. An economist as president… you would think our economy will sizzle. Far from it. She wasted all those 10 years, years Vietnam used to spectacularly grow their economy.

It was during Arroyo’s watch that we lost Intel. In 2006, Intel announced a major $300 million investment (later increased to $1 billion) to build a new assembly and test facility in Ho Chi Minh City, Vietnam. That’s a clear warning for Arroyo to do something.

By 2009, Intel officially shuttered its Cavite plant, laying off approximately 1,800 employees. The Vietnam facility effectively replaced the capacity previously held by the Philippine site.

But back to Mangun, the PSE and the column I wrote. John was saying that “the root causes of problems at the PSE have less to do with reforms and more to do with the fact that we have a bad stock market.”

And that’s primarily because “the overwhelming majority of corporations listed on this exchange is not suitable for a traditional stock exchange and only deserve the Wild West market that we had in the past. There are only a handful of companies on the PSE that could qualify for continued listing on other world exchanges.”

John pointed out that people invest in the equities market to make money from the continuing profits of listed corporations. Not so at the PSE. People make their money by constantly trading, preferably with insider information.

John observed that “very few companies on the exchange share profits with shareholders. If you looked at the dividend history of most PSE listed firms, you would think that little operating profits are ever generated.”

Fast forward to 2026… The PSEi is hovering around the 5,900 to 6,000 level. The market recently hit a five-year low in late 2025, dipping into the 5,600 range  — levels last seen during the height of the pandemic uncertainty. International investors have been aggressively cashing out for months.

And none of these can be blamed on Trump’s war and Hormuz. The bearish market was going on for quite a while now.

John continues to argue that then as now, the PSE is “underdeveloped by design,” functioning more like a private “guild” or a cartel than a modern global exchange.

“Listing is not discouraged. It is merely structured to fail – low float, thin liquidity and a market depth that makes the listing functionally meaningless from the first day of trading.”

In the PSE, the low public float allows controlling families to retain nearly total power, leaving minority shareholders with little influence. So-called independent directors are chosen by the controlling families.

John cited “scandals” where private owners stripped companies of retained earnings through massive dividends just before an IPO, effectively selling the “husk” to the public.

The PSE is a liquidity trap. Because so few shares are actually traded, foreign institutional funds often cannot enter or exit the market without causing extreme price swings.

As of 2025, the PSE has roughly 280 listed companies. For comparison, Thailand has over 800 and India has over 5,000.

John is right about conglomerates using retail investors primarily to provide exit liquidity for insiders.

Recent delistings from the PSE are cited by John as the “ultimate proof” of his long-standing critique: that for many Philippine firms, the costs of transparency and compliance far outweigh the benefits of a public listing that fails to provide fair value. Just ask MVP.

What stocks are still worth our attention as investors?

Look at DMCI, known for aggressive profit-sharing, often ranking as a top yield stock of 8.6 percent, significantly higher than the market average of roughly two to three percent.

If you buy SM or Ayala, you are effectively giving the family a “low-interest loan” in exchange for the prestige of owning the country’s biggest assets.

Who is John Mangun? John is an American who has made our country his home. He is more pro-Filipino than many of our elite. Married to a Filipina, John sent his children to a Makati public school. I take his views seriously as coming from one who is very concerned about our country’s future.

When John mentioned my 2002 column in a post at X, he fired-up my suspicion that over the last 24 years, we have become a zombie of a country… and sinking fast.

We were 83 million Filipinos in 2002 and are now 117.6 million. The mouths to feed increased by about 42 percent.

The Social Weather Stations annual average hunger rate was 10.1 percent in 2002, compared to 23.2 percent in March 2026.

That’s 24 years of being oblivious to our dire situation, as if the mess we’re in is normal, “parang wala lang” so we still don’t seem to care. Just look at the Senate! It’s shameful. It is enough to make a grown man cry.

Boo Chanco’s email address is [email protected]. Follow him on X @boochanco