Archive for March, 2009:
Written on March 30th, 2009 by CleanedUpCreditno shouts
Bernard Madoff will go down in history as pulling off the biggest, most hurtful in terms of psychologically and financially, ponzi schemes in the history of the US. Once a respected fund manager, and even holding a top spot at the NASDAQ exchange, Madoff won a lot of followers with an investment that seemed to produce very consistent and fairly high but not so much so to create suspicion right away, returns for his clients.
Even though one man who studied his investments said there was no way he could have consistently racked up such great returns over the period of years he ran his scheme brought this to the attention of the SEC repeatedly, his please for a serious investigation were basically ignore. Hence, why we need a major overhaul of the SEC to make sure these types of schemes don’t undermine the investment world and shake investor’s confidence over and over again.
An news piece recently spotlighted the fact that many of Madoff’s victims, several of whom have basically lost their life savings and are devastated financially, want justice to be served and want that justice to be as swift and as severe as it possibly can be. In other words, they don’t want this guy getting off easily at some minimum security white collar prison that isn’t really like hard time at all.
His victims all feel that he should serve maximum prison time for swindling out of their hard earned money, many times up to thirty years worth of saving and investing, which were just gone in a dash. One person even said that their son’s college fund along with their life savings was wiped out because they believed in Madoff securities and thought they would also be protected from such an elaborate scam by the SEC, of which one email scoffed that obviously they were wrong on both counts.
Written on March 27th, 2009 by CleanedUpCreditno shouts
The recession we are currently in may or may not become a more serious event, called a depression. In fact, it may already be a depression, which is something that may not be officially called until months from now for all we know. The unemployment numbers have jumped over eight percent, which is the highest it’s been in over a quarter century, and we are seeing a greater contraction amongst the credit markets, which we are being promised will start to open up again per the Obama economic plan and policies. As to whether this will work, one has yet to see…..no one knows what will work with absolute certainty, and that is why there is such an over abundance of fear right now.
But are you taking it in stride? Are you calmly observing this unfold, or are you one of the many who feel the cold grip of fear come over you every time you consider your job security, your mortgage, your financial comfort and security, and all those little things in your life that provide material comfort that you just seem to take for granted sometimes?
Many people have shared their stories about how this current economic condition has changed them. It may not have dramatically changed some people’s spending habits or their optimism about America’s future and the future of the economy and their jobs, but others are undoubtedly shaken, almost to the point of no return, ready to go into full on battle mode, and start buying canned goods and rifles to protect their property when everything “goes to hell”.
You get anywhere in between when you ask various people. I can tell you how I’m taking it. I’m cutting back on pleasure spending. This means my once a week shopping trips to Target and the like have been cut out. It didn’t mean I would spend money once a week there, but it certainly left me open to that possibility. Well, not any more, I’ve begun to cut random, pleasure shopping trips to a minimum because I know that I won’t spend money if I’m not out and about.
We’ve begun renting a lot more movies through Netflix, so that we can stay home and entertain ourselves there, rather than do things like go out to dinner or any other form of entertainment that costs money. We’ve cut out things that aren’t necessities or even extreme nice to haves, like our Distillata water, and instead installed a forty dollar water filter in our refrigerator that lasts 400 gallons, a lot better than what we were paying for the delicious Distillata water.
It’s all these little things that we feel have made a bit of difference in our lives, and that will help us pay off high interest debt rather than spend new money on things that are not necessary, and that’s how we’re coping with this recession.
Written on March 23rd, 2009 by CleanedUpCreditno shouts
Getting a good credit card means getting one with fair terms, a low apr, or prime annual percentage rate, just in case you can’t pay the monthly bill off every time and are in turn paying outrageous returns to someone other than yourself, and one that is not going to jack up you rate indiscriminately.
Unfortunately, in today’s climate of economic fear and companies pulling back on both their rewards on the credit cards that used to entice us to use them, and the lower interest rates, as well as the annual fees and the fact that you may have a lower monthly payment and higher limit.
With the new policies of so many banks that have gotten burned by these tough financial times, getting new revolving debt instruments with good terms and a generous credit limit has proven harder and harder as everyone scrambles for the same thing – better rates, good limits, and no annual fees. Business people that I know have been complaining about the credit card’s policies, because it is stifling consumer spending, which was once a lot more agressive when more credit was available on fair terms to consumers.
Now, many people are really giving thought to shopping around for credit cards. They aren’t just signing up for the first thing that comes along, which could very well be one that is not really fair to them or is definitely more beneficial to the lender rather than the consumer.
Written on March 19th, 2009 by CleanedUpCreditno shouts
I just visited my tax accountant’s office a few days ago, and left it feeling a nagging sense of anxiety. But this is nothing new for me really. Every year, I agonize over gathering all of my year’s information together, making sure I get every possible deduction, since in addition to having a regular nine to five job, I also run a business on the side, and making sure I’m also not missing any of the streams of income I’ve generated, so I don’t inadvertently make Uncle Sam mad.
That’s the last thing any of us needs, and the tax man tends to strike fear in most American’s hearts, especially those that run businesses where the record keeping can be very confusing and the tax codes don’t exactly help. Even with a professional to help you, it can be confusing as to what you really need ot even take in to your tax preparer every year, and when you do finally gather everything together, you’re almost always left with a nagging feeling that you forgot something.
I mean, a whole year’s worth of information is a lot! Especially when I tend to forget things that happened a mere one day ago, let alone several months ago. It helps a lot if you keep an immaculate record of receipts and comings and goings of your personal money and also any business related money that happens to enter in to the picture.
Another thing that can help tremendously, which I myself have not implemented due to time constraints, are money management systems like Microsoft money and Money business edition, which simplify the book keeping process – especially if you are the secretary, treasurer, and CEO all in one, which a lot of small business owners have to be due to income and debt ratios.
Every year stress seems to peak about taxes in March, because that’s when that dreaded April deadline comes looming and people start to panic and know they have to start getting their information together quickly. However, if you do a little planning ahead, you can stave off this sort of mess and actually enjoy your March month!
Written on March 16th, 2009 by CleanedUpCreditno shouts
The rate of financial losses for people who did their planning right for their retirement is both astonishing and frustrating. Portfolios are rapidly shrinking for individuals who are already retired or who thought they would be on the brink of retirement by now.
At what point can a client actually file a claim on their broker for misrepresenting a financial product or doing illegal or unethical trades with their funds? If your losses are strictly from the general downturn of the market, you will not be able to file a claim. It is not a basis for legal action if you are just upset about the shrinking of your portfolio. You have to show illegal misconduct on the part of the broker.
An example of poor investing strategy would be a couple on a fixed income being put into a high risk financial product for their investment needs. In this situation, you may be able to file a claim. Certain other practices by brokers are also valid reasons to file a claim. A practice called churning is done by unethical brokers where they trade financial products excessively to bolster their commissions.
Another inappropriate financial move on the part of the broker would be unauthorized trading and that woulld be grounds for a claim. Unauthorized trading is trading in the market without the client’s knowledge or consent. Another basis for filing a claim is a misrepresentation of the nature of an investment. In this situation, the broker would give the client either false information or not present the complete facts about a given investment.
Another example of misconduct on the part of the broker is cold calling which is unsolicited phone calls coupled together with high pressure and heavily persistent measures. If you feel you have been the victim of misconduct on the part of a broker, you can start by hiring an attorney and file a claim with the FINRA. Include all names, dates and account numbers on your form but be concise. For your compensation interests, it is better to name a firm rather than an individual broker.
It is expensive to start and keep the legal process going. In security arbitration, it is usually done on a contingency basis and the lawyers usually get up to 30% of the award.
Filing fees range from $50.00 to $1800.00 and there is a hearing fee of $50.00 to $1200.00. One option, if you can’t afford this, is to look for pro bono legal services featured at select law schools.
You want to be certain that you have a case and a valid reason for pursuing legal action before starting this process.
Written on March 9th, 2009 by CleanedUpCreditno shouts
I live in the greater Cleveland area of Ohio, where there will be some of the Federal stimulus money funneled to due to our high per capita population. Ohio is also one of the greatest states where you can find a job, because of it’s relatively close in proximity population and booming industries. It’s also been hit hard by the recession, but not nearly as hard as some of the states that are heavy in financial industry and the car industry (anyone seen how bad Michigan’s unemployment rates are lately, it’s sad).
Ohioans have submitted around 7,500 requests for stimulus money along with accompanying proposals for how to get things accomplished, as well as the amount of jobs they think their particular projects will generate, which is usually fairly lofty. The requests range from infrastructure types of requests, such as rebuilding freeways, bridges and the like, and things like drinking water plant rennovations and upgrades, which is actually going to also be a federal concentration (infrastructure, not drinking water in particular).
There is actually a website set up where stewards of a certain project can go to pitch their ideas for improvement with stimulus money. The government of the state of Ohio has not given any deadlines for submitting proposals, however it did say that getting them submitted as soon as possible was a priority as they do not know when the online submission will be unavailable. There’s no telling how many submissions for proposals they will get in the end, however it’s likely to greatly exceed the actual amount of money Ohio gets to work with.
With the news that a few states governors and senators have come forward and said that they do not want to accept the Federal stimulus money, there may be more money to go around, so who knows who’s going to end up with their shares. There is already one politician, of course a Republican, who is opposed to the stimulus bailout plan, going so far as to say that Obama’s plan is fiscally irresponsible.
Some say that not taking the money is irresponsible and all states should take it. One things for sure, Governor Schwarzenegger, or shall I say “the Governator” has said he’ll take any money that’s up for grabs from anyone who doesn’t want it, surely he’ll be happy if anyone else refuses the “jackpot”.
Written on March 6th, 2009 by CleanedUpCreditno shouts
Did I read this right? American Express, one of the biggest credit card lenders in America, is going to start offering to some of it’s customers to shut down their accounts with them, and get compensated for doing so. I’ve heard of compensating or rewarding customers to do certain things – like maybe buy something new or buy something specific at a specific time, but never a company paying customers to stop using their services, but hey I guess these different times call for different, albeit even strange measures.
But there is a catch, first you have to be part of a selected group that apparently the company does not deem as being profitable enough, and second you also have to pay off any existing balance on the credit card before you are compensated. But the price they are paying for these voluntary shut downs of accounts is pretty good I’d say, three hundred dollars!
American Express is just one creditor among hundreds who is really feeling the pain of the recession and is facing increasing losses with every month that passes due to people not paying their bills or stiffing them all together, which is surprising because American Express caters to the upper class when it comes to economic structure, and apparently they are suffering just as much as the middle and lower classes.
All credit card companies have responded to the crisis by scaling back on people’s available spending balance, as well as randomly increasing minimum payments and also sometimes even repricing the accounts into higher APR percentags, which is making it harder for many people to pay their card bills every month, and which is also hurting the economy further because it seems like all this easy credit isn’t there any more, and reducing the circulation of “money”, albeit not actual real money, in the economy.
Retailers are feeling the hurt because people aren’t using their credit cards as much due to these scale backs. Heck, I’m in a sales related business part time, and I’ve seen my sales slump tremendously since October of 2008, and I know it’s because people are scaling way back on credit card use.
Written on March 3rd, 2009 by CleanedUpCreditno shouts
In some very sad, angering, and actually one very optimistic story in the news as of late, it can be seen that we are going to keep hearing these unusual stories for quite some time as our country struggles to recover from one of the worst problems in history. The first one is very sad indeed. It’s about a ninety year old gentleman who lost his entire life savings of $700,000 in the Ponzi scheme that was built up over years by “financier” Bernie Madoff. The poor guy was unfortunate as many other were, in trusting this class A idiot who lost millions of dollars of hard earned money for people, and ended up losing every penny of his life savings- just down the drain, like that.
I can’t even imagine seeing my life’s worth flushed down the toilet like that, especially when I’m supposed to be enjoying my golden years in comfort and security. Shame on you Madoff, I don’t know how you can live with yourself, and the fact that you and your wife tried to shelter you assets from being seized to at least help pay back some of the people who’s lives you ruined just shows that you don’t have much of a conscience.
This ninety year old gentleman was forced to get a job paying ten dollars an hour at a local grocery store. I can’t even begin to describe the feelings of disgust this drums up, and I’m sure I’m not alone in that sentiment, and I’m a very forgiving person. In more positive news, apparently someone is benefitting from our current crisis. Used cars are flying off the lots, as people look for bargains on reduced used car prices and tend to not be going for the new cars any more instead opting to save thousands by buying used.
Used car salesman may be benefitting from this by selling more cars, and more easily, so at least someone is making better money. It’s good to hear even a glimmer of good news right now, it seems like Americans are hungry for it, lapping it up at first sight, giving us something to look forward to, and that ever so fading hope of a quick recovery. It will happen, it’s just a matter of time, please remember that!