Debt crisis, austerity moves, bail outs, political leadership changes, markets on a pogo stick – these are the “new normal” in a “new economy.”

As I find update myself with the world economic events, it makes me think I am in some bizarre new world order. Time was we only concentrate on the economic impact of the warring Middle East but it seems that the four corners of the globe have been sucked up by some economic tornado. In the western hemisphere, the U.S. in a lopsided battle against a sluggish economy still reeling from the devastating effects of the sub-prime crisis.

It appears that the astonishing amount of bailouts has not done much for the world’s largest economy and there has been political pressure on the Obama government. The Wall Street protests are an indication of the sentiment of many Americans and their nation is polarized.

Macroeconomic indices has not been rosy for the American front either – lackluster economic growth plus high unemployment rate is a recipe for economic disaster. On the European front, Portugal, Italy, Ireland, Greece, and Spain with their debt scares continues to give a lot of people sleepless nights (most of them bankers). Changes in political leadership in Greece and Italy might turn the tides to their favor but that remains to be seen.

Watching the developments in that region is akin to watching our “telenovelas” – lots of action, cliff hangers and more so, drama. Moving to the Far East – one the world’s largest economy, Japan, can’t seem to wake up from economic slumber. The once mighty Japanese economic empire is slowly losing preeminence with virtually no economic growth for many years and the recent devastating earth quakes puts a heavy toll on an already burdened economy.

Pockets of economic upheavals also erupted in many areas … the ongoing strife in the Middle East keeps the price of oil up further giving inflationary upward pressure on the world. The ever precarious Israel-Palestine relationship is a time bomb waiting to explode. National disasters are erupting more frequently and cuts across the globe, leaving untold physical and economic damages. China and India are strong economies but one would be foolish to think they will not be affected by the economic slowdown of the Euro-American economy – their biggest market.

What then of the Philippines? How do we fit in this “new normal” or the “new economy”? If first world countries are in a rut, what then for a country like ours? Aren’t we also struggling with a debt issue? Aren’t we also struggling with poor economic growth?

Firstly, let me ease the reader’s concern with our debt issue. The US, Italy, France, Spain, Greece and many others have an extremely high percentage of their debt payments as against their GDP – over 90% and some close to 100%. By comparison, the Philippines debt payment to GDP ratio is only a little over 50%. While we are still at risk in the global economic skirmish, I believe the present situation also opens up a lot of opportunities for us to take advantage of. In the arena of outsourcing, we have a big talent pool of skilled Pinoys who can do the job and do it well at cheaper costs. Our heroes, the Overseas Filipino Workers are ready to take on any job at any given time and in any place. Our banking system remains to be a stable one with good check and balance measures thanks to the Central Bank and surprisingly good legislation. I believe that the whole economic situation created some vacuums and voids a nation like the Philippines can fill, own and thrive at. This is clearly an example of the many advantages of being small, if only we rid ourselves of small mind thinking. In a new economy, one can get lost and forgotten – yet one can find a place to achieve many of her aspirations and goals.

I am generally a positive thinker and not fond of gloom and doom predictions; yet if I am to be objective and if I am to read the writings on the wall, I say that man’s economy is not going anywhere north anytime soon. How do I get to sleep with all these knowledge and understanding? My answer is very simple: I chose to subscribe to God’s economy instead.  Amidst all these, my faith in my creator gives me all the hope and security I need and my personal experiences have validated that I was correct in my subscription. In His presence, I fear no recession, no inflation, no debt crisis, no unemployment – all I experience is peace.

“Trouble and distress have come upon me, but your commands give me delight.”  – Psalm 119:143, NIV.

* Also appears in Moneysense November-December 2011 issue

… con’t

More than a flourishing advocacy, I am very thankful for many things. On a personal finance note, my wife and I went to a challenging transition this year as my wife finally hangs her entrepreneur hat to focus on home-schooling our boys and to be a full-fledged home maker. After 19 years of supporting me financially, we felt that we make the necessary changes in the family. It was not an easy transition for me and my wife (and our understanding children) but we made the necessary adjustments by watching our budgets closer, avoiding unnecessary expenditure, cutting some costs—all without sacrificing quality living. Despite this overwhelming change, my wife and I still decided to build on our kitty and be deliberate about it. My wife often reminds me to practice what I preach and experience has taught me to always listen to the wisdom of my wife.

2010 has been a wonderful year for me and my family largely because of one thing: obedience. More than in previous years, we decided to be more obedient in the commands of the Lord, and we opted to be better stewards. Despite the challenges, the Lord has blessed us with everything we need and even more. This year, we gave away more than we ever did and the blessings keep on coming. This year we can really prove the saying “the more you give, the more you receive” is really a gospel truth. Besides, what we have and what we own are not ours anyway, we are merely managers of the resources God has endowed us with.

Despite the challenges 2011 may bring like a bear market, more fiscal issues and reversals in the economy and the like, we do not worry anymore for we believe that there are no recessions in God’s economy. We are looking forward to an even better year in 2011 and so should you. Remember this: “For I know the plans I have for you,” declares the Lord, “plans to prosper you and not to harm you, plans to give you hope and a future.” —Jeremiah 29:11, NIV.

A Happy New Year to all!