PSE will undertake deep reforms

I just had a most informative phone call from PSE Chairman Vivian Yuchengco, who just returned from what she described as an encouraging road show in Singapore and Hong Kong. After expressing disappointment with my "negative" column on the PSE, she said the board she now heads is actually addressing the concerns raised by my column. "You, of all people," Vivian Y admonished. "I fully expected you to help with our drive to reform the market."

In the face of that, I copped out and pointed to John Mangun as the one whose views I appropriated in my column. Sorry, John, but I needed a quick exit from a nearly hyperventilating Vivian Y. No, she wasn’t really hyperventilating but she was talking in her usual 500 miles per hour speed and it was difficult for me to get a word in. So I had to say, it was John’s fault.

Actually, she was excited with the progress they are making in marketing a new PSE. She thinks they have made some headway with foreign fund managers, or at least, made them realize that the PSE is still alive and promises to be a better exchange. She had all the right to feel that I had let them down, for raining on their parade.

And yes, Vivian Y assured me, they are addressing the concerns John and I raised and more. Yes, there is this very real problem of liquidity and token public offerings that we raised. They have plans to fix those concerns. What is more, they are looking at the possibility of cleaning up PSE’s line-up of listed issues. But she couldn’t be more specific because you know naman how it is to introduce reforms at the PSE....

But if she could have her way, bankrupt mining firms cannot get a new life as high-tech companies with no real technology to speak of. Backdoor listings would be things of the past. They may even delist some of the more spurious ones. They will be strict about corporate governance and transparency, in line with the programs of the SEC. They plan to invite groups of OFWs to invest in the equities market and this is why Vivian Y wants to be sure their hard-earned funds are not lost to the usual market shenanigans.

Vivian Y also said that even now, the bluest of the blue chips have started to be more generous with their dividends, with some of them giving returns that beat current money market rates. If Vivian Y gets her way, the PSE won’t be a Wild Wild West anymore. She said the Board has encouraged Ernest Leung to hire the best professionals to run their reform programs. But Mr. Leung is taking a bit of time to do that. This is why, she surmised, they are not getting their message through loud and clear just yet.

So, I assured Vivian Y that I am with her and her reform programs. I am not one to undermine such a positive development. When I write darkly about some matters, it is always with the hope that enough good people will become angry enough to set matters right. Hopefully, the rest of the PSE, specially the pistoleros in the Old Wild Wild West, will let her clean the exchange and make it world class. In the meantime, here is one of the more interesting e-mails also reacting to that column on the exchange, from reader Enrique Gonzalez.

I normally enjoy reading your column given your often casual remarks and satiric humor on pressing issues in our society (business and politics). I am writing to you though regarding your column on "PSE, is basically a Bad Stock Market" on Sept. 9, 2002 in the Philippine STAR.

Though it is true that our stock market and economy is in the doldrums, the many reforms being undertaken by PGMA, SEC, PSE and the private sector will hopefully lead to a stronger and more competitive country. Undermining present efforts of the PSE is counterproductive to solving the ‘root causes’ mentioned in your article.

Though I agree with the problems of a ‘bad stock market’ such as quality of listed companies and financial structuring, these pose long-term challenges to any stock exchange. Market fluctuations tend to affect those indicators, though a regulatory watchdog can curb abuses in this department.

I believe the priority of the PSE right now is to raise investor confidence by changing the negative perception on the Philippine market. The intended road show is the only way to bring our mission direct to their doorsteps.

I hope I was able to provide an alternative viewpoint on the matter. To let you know about my background, I was the youngest stock clerk/broker in the PSE Makati at the age of 14 back in the 1980’s I am now engaged in venture financing in media and technology.

Erratum

The sentence in my column last Friday on the medical malpractice law that reads "According to this item I caught this report on the Web..." should have read, "According to this report I caught on the Web..." I honestly thought I fixed that one when I reviewed my column before sending it to my editors. I guess, I goofed. If I had malpractice insurance, my premium would be sky high. So sorry...

Medical malpractice

I received this e-mail from reader David Michael Murphy, M.D., on that column on medical malpractice last Friday.

I thought your column on Friday was dead-on. If there is anything to be learned from the American experience, it is that physicians must police their own ranks, educate those who do not maintain an acceptable level of knowledge and discipline those who do not maintain an acceptable level of care. The medical liability issue in the US is a nightmare and we physicians have only ourselves to blame. I hope that Filipino physicians are wise enough to learn from our experience.

You are, of course, also exactly right that time spent with the patient, treating him/her as a person and not "a case of...", establishing rapport is the best defense against liability suits. In 25 years of practice I made my share of human errors but I was never sued, in large part by luck and also in part because I did my best to deal with patients‚ needs, not merely their symptoms.

The largest part of medical liability insurance premiums goes toward legal fees, both plaintiff’s and defendant’s. Many people who deserve to be compensated are not, because of the vagaries of the legal system, and some who do not deserve to be compensated receive awards, sometimes fantastically large awards. The court process is tedious and time-consuming and patients with serious illness and disability have neither energy nor time to spare. The system is not responsive to the needs of patients who have had adverse results as a result of their treatment.

I have long felt that every physician should be required to contribute a certain amount, either a percentage of practice income or a flat fee, into a fund much like the workman’s compensation fund, that is then used to compensate those who have adverse outcomes of treatment. This would apply not merely to cases of malpractice but to those unfortunates who have disability or financial loss or to relatives of a patient who dies, for any reason related to their treatment. The awards should be made through a non-adversarial process, utilizing a board highly weighted with physicians who can objectively evaluate the medical issues and the degree of disability.

This idea never gained much support in the US and I doubt that it would get much support in the Philippines but it would certainly be more beneficial to patients than the system as currently in place in the US.

And as for HMO’s, they are a worse plague than the lawyers. It’s good that we can still laugh about them. Good joke; I sent it to most of my doctor friends and patient friends.

God bless.

E-mail

This one is from reader Ben Simpao.

Reasons why having an E-mail is like having a penis

1. It’s more fun when it’s out, but this makes it hard to get any real work done.

2. If you don’t take the proper precautions, it can contract a virus.

3. Those who have it would be devastated if it is ever cut off!

(Boo Chanco’s e-mail address is [email protected])