Dubai Debt Insurance Cost Falls

Written by AINSLEY THOMSON
Posted by Minjune Kim

LONDON -- The cost of insuring Dubai's sovereign debt against default fell Monday as investors' concerns about the region were allayed after the United Arab Emirates central bank pledged support for the country's local and foreign banks.

It now costs $576,000 to insure $10 million of Dubai sovereign debt against default for five years, down from $647,000 at Friday's New York close, according to data provider CMA.
The cost of insuring neighboring Abu Dhabi's sovereign debt also fell Monday. It now costs $146,000 to insure $10 million of Abu Dhabi's sovereign debt against default for five years, down from $175,600 at Friday's close.

The drop in cost comes after the U.A.E. central bank said Sunday it is offering an additional liquidity facility to local and international banks in the U.A.E. and stressed that it "stands behind" them. Dubai and Abu Dhabi are two of the seven emirates that make up the United Arab Emirates.

Last week, Dubai World's restructuring announcement also affected countries such as Greece, as investors became increasingly concerned about financially stretched countries. However, the cost of insuring Greece's sovereign debt also fell Monday as it benefited from the improved tone in financial markets. It now costs $192,000 to insure $10 million of Greece's sovereign debt against default for five years, down from $200,000 at Friday's close, according to CMA.

Meanwhile, the five-year credit default swaps for Dubai-based port operator DP World tightened Monday to 6.425 percentage points compared with its closing level Friday of 7.44 percentage points, CMA said. The port operator's CDS moved as wide as 8.10 percentage points during trading on Friday.

Dubai World owns 77% of DP World, which is the fourth-largest ports operator in the world. The port operator will be excluded from its parent's debt standstill talks and restructuring.

CDS are tradable, over-the-counter derivatives that function like a default insurance contract. If a borrower defaults, the protection buyer is paid compensation by the protection seller. Wider spreads show the cost of default insurance is going up, suggesting investors are less confident in a borrower's ability to repay debts.

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Private Health Insurance

By Adam Lindheim


It is estimated that close to 46 million Americans don’t have health insurance coverage, and with today’s economy that number is expected to increase. If your job doesn’t provide health coverage, or you’re jobless, private health insurance is the only option. Private health insurance is very expensive, and depending on your age and health will determine the type of coverage you are eligible for. Premiums typically range from $100-$1000 dollars, it is important to note the lower the premium the higher the deductibles, and smaller range of coverage that your plan is likely to cover. For those citizens who have recently lost their jobs, and have pre-existing health issues are more likely to run into a tougher situation.

If you are looking to secure private health insurance and you have heart disease, asthma, diabetes, cancer, or even AIDS the chances of getting health insurance dramatically drop. Those who have been let go by their company (with at least 20 employees) will be covered by CORBA. This means that you will be covered for up to 18 months following your departure from your company, which is especially good news for those who have pre-existing illnesses. Some states wont even allow discrimination when it comes to acquiring health insurance. A lot of American citizens such as Don Hall, a manufacturing supervisor from Ohio has seen a $500 dollar increase in his health insurance premiums per month. The American government is scrambling to find a solution to this growing problem that is hitting many homes in the U.S. Some citizens who belong to worker unions can apply for health insurance through a group health plan through their unions. It is important financial decision to pick an affordable but secure plan when evaluating private health insurance plans.

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Consumer Finance Tips for Holiday Shoppers

Written By: Lisa Matthys

We all know Christmas is coming when retailers start putting up festive decorations and advertisements drawing consumers into their special deals only available on Black Friday. Even most employers give Black Friday off to employees as it is the day after Thanksgiving, initiating the beginning of the Christmas shopping season. As the economy continues to struggle, the unemployment rate rests at an all-time high, giving consumers very little savings to spend on gifts this holiday season.

With the economy in a recession, consumers need to find other ways to give their family the gifts they want. Many turn to credit cards to help finance the lack of immediate capital. However, experts say to try to limit your credit card use to online purchases and big ticket items. If you do use your credit card this holiday season, make sure to pay on time to avoid any extra penalty fees.

Many shoppers, approximately 43%, plan to use debit cards instead of credit cards. However, there are drawbacks to using debit cards over credit cards. When purchasing online and your security is compromised, your entire bank account can be withdrawn without protection. Likewise, if you spend more than you have in your account, heavy overdraft fees will apply. So shop wisely this holiday season!

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"Free" credit reports- just not true

Written by Michael Rivezzo

The term "free" is a popular buzz word for consumers, every company would use the term loosely in their commercials if it was legal, but companies can't just use the word "free" lightly, it actually has to mean something for nothing. Now the government is taking the initiative to investigate those annoying commercials offering "free" credit reports. After 11,000 complaints have been filed with the Better Business Bureau stating that consumers where actually charged a monthly fee of $15 dollars. Many complaints stated that the commercials are actually misleading and that the true information lies in the the small print.

The truth is there is only one website where people can actually obtain a free credit report, with no strings attached. Its a government owned website: AnnualCreditReport.com. Through this website everybody is allowed one free credit report a year. The credit-monitoring business is a $700 million dollar a year industry, where analyst saw that people do not need to be checking their credit so much, they can simply get by with the one free credit report a year.

Decision are soon to be made on whether the government will allow these "free" credit report ads to continue. I think they should allow the companies to change the way they market their service, then disallow them from using that stupid jingle.

http://www.cbsnews.com/stories/2009/11/22/eveningnews/main5739490.shtml

http://blog.nj.com/njv_editorial_page/2009/11/free_credit_report_websites_wh.html

http://www.nytimes.com/2009/11/03/your-money/credit-scores/03scores.html

U.S. Looks to Australia on Credit Card Fees

Article by KEITH BRADSHER
Post by David Held

SYDNEY — When Steve Franklin bought four plane tickets on Qantas last June, he faced an unexpected expense: a surcharge of 7.70 Australian dollars on each of the 136.70 dollar ($126) tickets — just for using his Visa credit card.

Mr. Franklin, who planned to fly his parents and his 7-year-old twin daughters from Sydney to Adelaide, knew that changes to credit card rules had affected the cost of using plastic, but the extra 5.6 percent seemed excessive.
The charges were the consequence of changes in credit card rules in Australia that were aimed, in part, at reducing the cost of hidden fees for using plastic. But the law, passed six years ago, also allowed merchants to tack on new charges, and many have done just that, in some cases with fees that exceed the old ones.

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China Seeks to Slow Rapid Growth of Lending

Post by Shawn Chandok

Article by Keith Bradsher

Chinese banking regulators are putting pressure on the country’s banks to raise more capital and temper their rapid growth in lending, in a clear sign of official concern about the sustainability of the nation’s credit boom, senior Chinese bankers said on Monday.

United States and European officials have also pressed their banks to shore up their finances in recent months, but the reasons behind the Chinese regulators’ capital-raising push are very different. In some ways, the regulatory pressure reflects the robustness of the Chinese economy, in contrast with lingering economic weakness in the West.

Western regulators have put pressure on the banks they oversee to raise money, often through the sale of overseas units and other assets, to rebuild capital bases depleted by losses on mortgage-backed securities and other investments. Western banks have moved to raise the money even as they have slowed their issuance of new loans, which has helped hold up their capital as a percentage of assets.

Regulators in Beijing have a different concern, Chinese bankers said. As bank lending has soared this year, banks’ capital has risen less quickly, so their capital adequacy ratios have begun to slip.

While China’s regulators are comfortable with current capital adequacy levels at the nation’s major banks, they want them to have plenty of capital to be able to continue lending briskly next year without difficulty if needed to sustain economic growth, bankers said.

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Safest Cars for 2010

Posted by Quang Nguyen
By Sarah Hacker - ASSOCIATED CONTENT

Every year, car companies constantly work to innovate and make their cars better and safer for the driver. These five 2010 cars are at the top of the list for being the safest on the road.

The Volvo XC60

The Volvo XC60, new to Volvo in 2010, has many safety features that don't even compare to their other cars. The car is equipped with new preventive safety, protective safety, and child safety features. Some of these features include an anti locking brake system with hydraulic brake assist, ready alert brakes, collision warning with auto brake, and city safety. The car is well lit with daytime running lights, dual xenon gas discharge headlights with active bending lights, side marker lights, rear fog lights with auto off and front fog lights. In case of a crash, the car comes with a whiplash protection system, an energy absorbing interior, dual stage airbags, a side impact protection system, and an energy absorbing frontal structure.

The 2010 Volkswagen Polo

This car is not only one of the safest of 2010, but one of the safest cars world wide. The airbags in the car include the combined head-thorax airbag. The seat belts come with belt force limiters and seat belt tensioners that that prevent whiplash and therefore injury. For children, there is a three rear head restraint and isofix child seat.

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Forget Car Insurance, Does It Have Medicare?

by Jacques Steinberg
posted by Jameel Murray

MY son, Jordan, who is 9, desperately wanted a pet that might be more interactive than the fish in his aquarium. But I am severely allergic to most animals with fur. I am so asthmatic that, unlike the Obamas, who went with famously hypoallergenic Bo, our family wound up choosing something less huggable though no less lovable: a gecko.

And so last fall, a white lizard no longer than a BlackBerry and no heavier than a stack of Post-it notes took up residence in Jordan’s bedroom. He called him Belzer, after a character in “Rotten School,” a series of children’s books. Before long, Jordan had coaxed Belzer to climb from his palm to his elbow. We also noticed that when Jordan put a Yankees game on the radio, Belzer would emerge from his cave to listen. To assure that his gecko would be the last thing he saw at night, Jordan positioned Belzer’s glass tank, illuminated by a red heat lamp, within sight of his pillow.

So it was with some concern that I noticed earlier this fall that Belzer appeared to be “blocked,” as my grandmother might have said. In other words, he was no longer littering his sand with the remains of whatever worm or cricket he had consumed the night before.

As far as I know, Metamucil makes no product for a gecko. Which meant that this situation called for a specialist. My journey to the cutting edge of veterinary care would ultimately cost me more than $500, I am embarrassed to say. That was what I spent on an X-ray that revealed a major intestinal blockage, from Belzer’s consuming too much sand bedding with his meals.

Those fees also covered the potential cure: the delicate administration of laxatives formulated for a reptile — Procter & Gamble, the maker of Metamucil, take note — as well as so many injections of fluid into Belzer’s backside that he must have felt like a baseball player on steroids.

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Black Friday Saves Familes Big Dollars

By: Laura Reginelli

Posted By: Group 1B

When Thanksgiving rolls around, many people tend to think about the day after, Black Friday. In this economically troubled time, families are looking for ways to cut costs and in some cases make ends meet. Black Friday allows shoppers to buy for the holiday season and receive great deals while doing it, inevitably saving them money.

Black Friday can be a competitive, mad-dash for shoppers, sometimes proving to be too much for people. When it comes to this day of shopping, make sure to plan ahead by packing snacks and wearing comfortable clothing. Also shopping may be a little easier if you go with a list of what you need and where the deals are.

Some stores are even joining in on the family planning process. This year Kohl’s is allowing their customers to use their Web site to create a shopping list that they can print and take with them. From there, the customers are off to the stores. Kohl’s will open at 4 a.m. on Black Friday this year, allowing for the madness to start even earlier.

Black Friday shoppers are often a breed of their own and some of the most determined individuals. Although many of us may not see the real importance of going out into this “mob scene,” others swear by the savings.

One Black Friday shopper confesses “I've been venturing out early on Black Friday for eight years now, and every year, I've saved at least $200 — usually much more.”

So if you are looking to save a few extra dollars in the holiday season, make a plan and venture out instead of sleeping in the day after Thanksgiving! It may just save you.

Sources: http://blogs.sun-sentinel.com/consumerblog/2009/11/skip-black-friday-sales-you-may-as-well-set-your-wallet-on-fire.html

http://www.cnbc.com/id/33862032

http://www.bloomberg.com/apps/news?pid=20601103&sid=aEfbyXYEsM1I

Teaching Your Children the Value of Money

By: Janielle Viggiano

Posted By: Group 1B

When it comes to teaching children about money, the earlier the better. It’s not an easy task but if you start early enough there are short and long-term benefits. In the short term, they will develop strong savings habits and learn how to make smart purchasing decisions. In the long-term it will help them to avoid accumulating debt and plan for financial security. It’s also a good idea to teach your children where the money is coming from because most children only see it as coming out of mom and dads pockets. Start by explaining to your children that money is earned by working.

There are different feelings about whether or not an allowance is a helpful way to teach children the importance of money. According to the University of Arkansas, “Children need to have money of their own to learn how to manage it. An allowance is a better teaching method than simply giving children money upon their request, says the Cooperative Extension Service, University of Arkansas. An allowance for children should be a set amount, should be paid regularly, and not tied to regular tasks required of the child. When deciding on the amount of an allowance, discuss what items will be covered. The amount should be enough that the child has money to manage with no strings attached (2006).” More examples of lessons to teach your children about money include: make saving interesting, banking and investing, and compounding.

Sources: http://www.arfamilies.org/money/children&money/

http://money.cnn.com/magazines/moneymag/money101/lesson12/index.htm

http://finance.yahoo.com/how-to-guide/family-home/12820

ABC News: Tiger Woods’ Injury in a Car Crash: How Does this Impact His Corporate Value?

Word that Tiger Woods was involved in an early morning car accident likely rattled not just fans, but also the broad swath of major corporations that rely on Woods' star power to sell everything from sports drinks, T-shirts and razors to golf tournament tickets.

Reports say the golf star hit a fire hydrant and a tree near his home.

"I can imagine that the world stopped for Tiger Woods advertisers when they first heard the news and that, literally, their hearts missed a beat," said ABC News sports consultant and USA Today sports columnist Christine Brennan.

Woods has earned more than $100 million annually and, according to Forbes, more than $1 billion during his career thus far, thanks, in part, through endorsement deals with companies such as Nike, Gatorade, Electronic Arts, TAG Heuer and Gillette. The companies declined requests for comment from ABC News.

Nike, in particular, has been especially dependent on Woods, said advertising expert Larry Woodard, an ABC News columnist and the CEO of the advertising agency Vigilante.

"Nike wasn't really into golf before Tiger Woods came," he said. "He helped them take a pre-eminent role in golf."

The PGA Tour also has a lot riding on Woods -- he drives ratings for PGA Tour broadcasts like no one else before him, allowing the tour to rake in greater advertising revenues and higher TV ratings.

"Tiger brought a lot of color to the sport both on his skin and his style of play and that's something that the PGA sorely needs," said Boyce Watkins, a finance professor at Syracuse University.

In the short term, companies tied to Woods likely wouldn't lose too much cash if Woods couldn't fulfill his immediate endorsement obligations; corporations take out insurance policies to cover themselves in case of such events.

"I bet you any intelligent corporation that deals with Tiger Woods has conditions in place to protect them in the event that something like this were to happen," Watkins said. "You have to confront the fact that a human being is perishable commodity. It is a commodity that does not come without risk."

 

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Commercial Real Estate Up But Still A Rocky Future

By, Meredith Anderson


For the first time since 2007 the commercial real estate activity seemed positive. However this rise although slightly encouraging does not acknowledge the fact that the real estate market had a drastic fall just one year earlier.

The NAR, National Association of Realtors, showed that the brokerage activity rose from .09% to 102.4. However the index is still falling short of what it once was on a couple years ago.

Although there was somewhat encouraging news form the real estate market, credit availability remains a huge problem for the industry. The vacancy of both commercial and residential properties is predicted to reach record highs this year. "Credit availability needs to significantly rebound for any hope of a meaningful commercial recovery in 2010," NAR chief economist Lawrence Yun said. Its a great time to buy, but only if you have the money at hand.


Sources:

http://online.wsj.com/article/BT-CO-20091119-711360.html

http://www.reuters.com/article/GCA-Economy/idUSTRE5AI39920091119

http://www.bcbr.com/article.asp?id=103101

Real estate: October home sales up in Hampton Roads

Sales of Peninsula-area existing homes were up 24.2 percent in October, compared to October 2008.

At first blush, it sounds like a drastic improvement. But, real estate agent Bob Sullivan cautioned, October 2008 was a terrible month.

"October of last year is when it really started to go into the toilet," said Sullivan, president of the Virginia Peninsula Association of Realtors.

Nationally, existing-home sales were up 10.1 percent from September, and year-over-year sales were up 20.8 percent, according to the National Association of Realtors.

A rush to cash in on the up to $8,000 first-time home buyer tax credit before it expired Nov. 30 bolstered sales. Since then, legislators have extended and expanded it.

Now, a credit of up to $6,500 is available to qualifying existing homeowners. Both first-time and existing buyers have until April 30 to find a home.

That will keep the housing recovery momentum going, Sullivan said.

Extending the credit to existing homeowners will give them the incentive they need to find another home, Sullivan said.

"They might be able to recoup some of the money they would've lost because of the pricing coming down," he said.

October was the third consecutive month to show year-over-year gains in the number of sales on the Peninsula and Middle Peninsula, and November sales hold promise. Year-over-year pending sales are up 43.6 percent, according to a Real Estate Information Network report.

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Posted by: Kelsey Hoffman

Graduating Without a Job?

By: Zachary Pienkowski

No one needs to tell college students that the job market is difficult. Countless recruiters tell students they are not hiring and cutting back, but will hold on to their resume and give a call if something opens up. Think that call ever comes? Probably not. However college grads are not the only ones seeking job, as the national unemployment rate has risen over 10%. The question in many Americans mind is when is this going to stop? Well many reports have been put out by the Federal Reserve recently saying the jobless rate will begin to drop, but do so very slowly. Most experts don't expect the job market to return to the full health of the past for at least 5 or 6 more years. Meanwhile, many unemployed men and women must take whatever they can get to pay the bills, even if it means settling for less. The economy is expected to have a 2-4% growth rate next year, but that will not be enough to jump-start the dismal job market. President Obama said that with the first stimulus package that was issued the unemployment rate would not rise above 8%, but it ended up soaring over 10% in a matter of months. The Obama administration still believes that the stimulus packages were effective and plan to release another one, however it will not be called a stimulus package because of the negative feelings the American public has about the effectiveness of the original.

Sources:

http://finance.yahoo.com/news/Fed-says-jobless-rate-to-drop-apf-2316913196.html?x=0
http://newsbusters.org/blogs/julia-seymour/2009/11/06/unemployment-surges-10-2-percent-cnn-asks-about-second-stimulus
http://money.cnn.com/pf/features/lists/state_unemployment/

Ways a Will Might Be Deemed Invalid

Even if a person dies with a Will (which is known as dying "testate"), a court generally has to have an opportunity to allow others to object to the Will, and if there are any objections, to determine if the Will is valid, because it is always possible that
(1) There was a later Will (which, if valid, would replace the older Will);
(2) The Will was made at a time the deceased was not mentally competent to make a Will, or
(3) the Will was the result of fraud, mistake, or "undue influence";
(4) The Will was not properly "executed" (signed);
(5) The so-called Will is actually a forgery;
(6) For some other reason (such as a pre-existing contract) the Will is not fully valid; or
(7) There are other claims against the deceased's estate that impact what the beneficiaries under the Will would receive.

Is it legal to force people to buy insurance?

Posted by Shawn Gao



Is it legal to force everyone to buy insurance? Can Congress force you to buy insurance?
As part of health reform, Democrats want to require all Americans to purchase insurance or face a fine.
However, by Utah Sen. Orrin Hatch, say Congress has no constitutional authority to tell people what to buy with their money.
I agree with the Sen. Orrin Hatch. America is a country where people are free to do anything under its laws. The Congress should not have the power to force people to do anything.
Despite any benefits from the health reform to the country, “ individual mandate” cannot be taken at this moment. Even though, each individual could be covered under insurance, and each state economy, it is unreasonable for people to be urged to purchase require insurance.
I mean people have their own right to purchase anything they want. Or, Congress may simply ask each individual to purchase America- made cars that easily help American economy.
The key is people shall decide whether they need to purchase insurance or not. Also, required insurance should be considered as substantial.
Source:
1.http://www.sltrib.com/news/ci_13838615
2.http://www.google.com/hostednews/ap/article/ALeqM5gm81TTE7a0EUL9JlzVML1dnH2N2gD9C43GRG2
3.http://www.freep.com/article/20091122/OPINION05/911220457/1068/opinion/Stupak-amendment-breaks-promise-of-health-reform

Public option vs. public opinion

By Alma Zhumagulova



With the US health care system being changed, many people are not sure whether the new health care system proposed by Barack Obama is better than the existing system and whether the Government should adopt it or not. According to the results of the poll conducted by Associated Press, when told that the new health care plan would be much cheaper since it is a government run program 52% favored it and 35% opposed it, while when told that with the new plan the government will get to decide which medical treatments to cover, only 44% favored it and 38% opposed. Clearly the general population does not have a strong opinion about the new plan. However, in general, 75% want the plan to be available nationally and 25% think that the individual state governments should decide on whether to offer the plan to the residents or not.
The Patient Protection and Affordable Care Act (H.R. 3590) provides that in the upcoming decade the US economy will be better off with the plan. It will cut the federal deficit, and increase federal spending and revenues. At the same time the insurance industry is aggressively lobbying and campaigning against the new plan. America’s Health Insurance Plans group states that “bill would increase costs for individuals, families and employers, reduce benefits for older Americans, and threaten employer coverage.”
In general, though, CBO estimates that since the low-income population is covered by Medicaid, the majority of working force is covered by their employers and the older population is covered by Medicare, only those who have preexisting conditions, approximately 2% of the US population under age 65, will sign up for it.
Sources:
http://prescriptions.blogs.nytimes.com/2009/11/19/insurance-industry-pans-the-senate-bill/
http://www.osnsupersite.com/view.aspx?rid=50801
http://www.nevadaappeal.com/article/20091119/NEWS/911189962/1058/rss08

Money Monday: The Best Personal Finance Stories from the Weekend

Posted by Ka Lee Angel Lee

Here is a run down of the personal finance stories you might have missed this weekend:

In Forbes, we wrote about why long-term investors might want to think twice before investing in gold (whether the metal itself or stocks from gold mining companies), how to push for a better retirement plan at work and how to avoid costly mistakes in your Individual Retirement Account.

The New York Times, meanwhile, discussed how investors are in better shape with the Dow at 10,000 now than they were with the Dow was at 10,000 in 1999.

Los Angeles Times columnist Kathy M. Kristof (a sometimes Forbes contributor) listed steps to take before the end of the year to lower your tax bill.

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Personal finance: Keep holiday spending under control this season

Posted by: Andrew Pia

Written by: Kathy DiCenso

As the year comes to a close, spending in most households heads up -- on holiday gifts, entertainment and, depending on where you live, on already high energy costs.

It's easy to lose control. So make a plan now to minimize debt while putting money where it absolutely needs to go.

Put your current finances under a microscope

Call it a gift from you to you. If you're trying to get your finances in order, plan a visit now with a financial adviser, such as a certified financial planner professional. This meeting should extend beyond your holiday spending to setting goals for saving, investing and extinguishing debt and setting financial goals for the future. You also can examine your spending patterns and the emotional drivers behind many of our financial decisions.

Create a holiday budget

If you have credit card debt now, you don't want to elevate those numbers. Set a spending number you will not exceed and start setting aside cash in an account to cover it. When should you make the budget? As early in the year as possible, but if you haven't started shopping yet, figure out how much money you can realistically set aside and stay as close to that number as you can.

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More Members of Middle Class file for Bankruptcy

Posted by: Scarlett Lu

Many middle class members have filed for bankruptcy. Among them are college educated and owners of homes. More than 100,000 middle class families have filed bankruptcy every month in 2007. The bankruptcy filings are warning risk that people can no longer count on their college education, good job, or home ownership in protecting them from a financial collapse. However, some highly educated have never been unemployed. There are many factors that cause bankruptcy these factors include poor saving habits, health problems, and excess spending.
Some people thought that having a home will save them from bankruptcy however, it does not. Many people had to file bankruptcy in order to pay for medical bills. Studies show that 2 million Americans annually.
Middle class families are encouraged to spend. So they spend more than they make. They are wrapped up in materialism. Some families had to downsize to save themselves from bankruptcy. Middle class people need to learn how to save more money by putting it in a bank, spending less, and etc. They should also learn how to budget their money correctly and save up for difficult times.

http://www.consumeraffairs.com/news04/2005/bankruptcy_study.html
http://www.usatoday.com/money/perfi/general/2009-11-19-bankruptcy19_CV_N.htm
http://www.mpbn.net/News/MaineNews/tabid/181/ctl/ViewItem/mid/3475/ItemId/9845/Default.aspx

http://www.consumeraffairs.com/news04/2005/bankruptcy_study.html

AIG gets a pass

By: Zachary Pienkowski

While we all have heard about the troubles that AIG has been facing over the last year, one thing that is nice talked about quite as much is what happened to those they insured? While it was all over the media how federal regulators worked around the clock in an attempt to bailout AIG, they did not properly work out agreements with their business partners to negotiate the value of their assets. The result was over $62 million of taxpayer and AIG money being distributed to 16 banks which were business partners with AIG. Generally when a toxic asset is being liquidated the value of the asset drops considerably and is usually acquired for pennies on the dollar. This wasn't the case with many of AIG's counter-parties. The exact opposite occurred, in fact, they paid 100 cents on the dollar for nearly all of the underlying assets. Complaints have been pouring in that the Fed gave up too easy and did not exercise their leverage to make AIG's business partners to fall in line like many of the other banks that were bailed out did. The Fed rushed to bail out AIG but then lost all of its leverage because they had nothing to threaten them with anymore. Prior to bailout AIG had the fear of going bankrupt, but after the bailout this was no longer the case. The Fed felt pressured to keep making the collateral payments to the other 16 banks that AIG could no longer fund because they did not want to have to force taxpayers to fully fund the 100 cent on the dollar default swap.

Sources:

http://money.cnn.com/2009/10/13/news/companies/aig_bonuses/index.htm?postversion=2009101318

http://money.cnn.com/2009/03/07/news/companies/aig.fortune/index.htm

http://www.forbes.com/2009/03/16/aig-counterparties-bailout-markets-equity-cds.html

College Expenses

Article by Tamar Lewin

Post by Shawn Chandok

The price of a college education rose substantially last year, despite a 2.1 percent decline in the Consumer Price Index from July 2008 to July 2009.Hit hard by state budget cuts, four-year public colleges raised tuition and fees by an average of 6.5 percent last year. Prices at private colleges rose 4.4 percent, according to a report issued Tuesday by the College Board.

Patrick Callan, president of the National Center for Public Policy and Higher Education, called the increases “hugely disappointing.”

“Given the financial hardship of the country, it’s simply astonishing that colleges and universities would have this kind of increases,” Mr. Callan said. “It tells you that higher education is still a seller’s market. The level of debt we’re asking people to undertake is unsustainable.

“A lot of people think we can solve the problem with more financial aid, but I think we have to have some cost containment. For all the talk about reinventing higher education, I don’t see any results.”

With room and board, the average total cost of attendance at a public four-year college is now $15,213, the report found. At private nonprofit colleges, which enroll about one in five college students nationally, the average total cost of attendance is now $35,636.

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Credit Card Companies Willing to Deal Over Debt

Post by David Held
By ERIC DASH

Hard times are usually good times for debt collectors, who make their money morning and night with the incessant ring of a phone.

But in this recession, perhaps the deepest in decades, the unthinkable is happening: collectors, who usually do the squeezing, are getting squeezed a bit themselves.

After helping to foster the explosive growth of consumer debt in recent years, credit card companies are realizing that some hard-pressed Americans will not be able to pay their bills as the economy deteriorates.

So lenders and their collectors are rushing to round up what money they can before things get worse, even if that means forgiving part of some borrowers’ debts. Increasingly, they are stretching out payments and accepting dimes, if not pennies, on the dollar as payment in full.

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Commercial Real Estate Up But Still A Rocky Future

By, Meredith Anderson


For the first time since 2007 the commercial real estate activity seemed positive. However this rise although slightly encouraging does not acknowledge the fact that the real estate market had a drastic fall just one year earlier.

The NAR, National Association of Realtors, showed that the brokerage activity rose from .09% to 102.4. However the index is still falling short of what it once was on a couple years ago.

Although there was somewhat encouraging news form the real estate market, credit availability remains a huge problem for the industry. The vacancy of both commercial and residential properties is predicted to reach record highs this year. "Credit availability needs to significantly rebound for any hope of a meaningful commercial recovery in 2010," NAR chief economist Lawrence Yun said. Its a great time to buy, but only if you have the money at hand.


Sources:

http://online.wsj.com/article/BT-CO-20091119-711360.html

http://www.reuters.com/article/GCA-Economy/idUSTRE5AI39920091119

http://www.bcbr.com/article.asp?id=103101

Realtors see sunnier 2010

Posted By: Nicole Nelson

Scott Van Voorhis

OK, here’s one that is sure to get all the housing bears out there feeling downright surly again.

The National Association of Realtors is forecasting that prices will rise 4 percent in 2010 after hitting bottom in 2009.Home sales will also rise by 700,000 to 5.7 million, he argued.

Lawrence Yun, the association’s chief economist, made the sure- to- be-controversial predictions to the faithful assembled at NAR’s annual convention in San Diego last week.

He also noted foreclosures will top out in the first half of next year and the “fear factor’’ of falling prices that has put such a damper on the market will fade.

I guess you have to hand it to Yun, if nothing else, he’s not afraid to stick his head out there.

Still, given some of notoriety the real estate trade group earned for some of its predictions during the bubble years, this is risky territory.

Would passage of health reform require quick changes in insurance plans?

By DAVE HELLING The Kansas City Star
Posted by Alma Zhumagulova


Millions of Americans are now engaged in a familiar ritual: signing up for next year’s health insurance coverage.

Pick a plan. Pick a premium. Make sure choices are submitted and approved on time.

But roughly half of those millions, according to a recent survey, are worried. They think the health care reform plan now working its way through Congress may force them to make major changes in their health plans quickly — perhaps within weeks — if it passes.

With one important exception, they can probably relax. Many of the major components of health reform won’t take effect until 2013.

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New Health Reform Bill is coming our way

By Jonathan Tse



Senate just unveiled a new health care bill that is supposed to expand health insurance coverage to 30 million more Americans. This is expected to cost about $849 billion over the course of 10 years. It was stated by Senate Majority Leader Harry Reid that this will not add to the current deficit but will instead reduce federal deficit by $130 billion over the next 10 years. On Saturday, November 30th, debates on amending the bill will begin if Senate decides to take up the bill. This bill is expected to be the largest revision of the US health care system since the creation of Medicare health insurance program in 1965.
The goal of this reform bill is to offer affordable and reliable coverage for those who are not insured and also help to lower costs for individuals, families, businesses and governments. It seeks to reduce long-term costs of health care for governments, businesses, as well as individuals and families, while also increasing the efficiency and quality of health care services provided by reforming how health care is provided. The bill is expected to introduce many new taxes and fees. A new feature of this bill is that it would require all individuals to purchase health insurance and would be fined if they do not comply with this rule. Parents are also liable for covering their children who are under 18 years of age. Another new feature is the Medicaid coverage will be expanded from the poor to everyone.

http://www.businessinsurance.com/article/20091120/NEWS01/911209989 http://www.insurancenewsnet.com/article.asp?a=top_news&id=112025 http://www.insurancejournal.com/news/national/2009/11/20/105471.htm

How to Manage the Cost of Your Funeral

by Dr. Boyce Watkins, Syracuse University 

Funerals are never fun. They are emotionally draining and you are forced to endure the shock of knowing that your loved one will never be back in your life. In addition to the emotional devastation, you have to deal with the financial burdens of paying for someone to be buried. We all know that funerals are not free or cheap, and the last place you want to be cheap is when it comes to burying the person you love.
But there are ways you can keep the cost down. They say you can't take the money with you, but someone who doesn't plan for their death may be taking their relatives' money with them to the grave. Here are some ways that you can bury on a budget: giving relatives dignity without creating financial hardship.

Exam chapter clarification – chs 10 and 15

Chapter 10 slides

Chapter 15 slides

college loans could contribute to tuition hikes

By Jeremy Davis

Originally Posted by Leah Gorham

It’s safe to say the hardest part to stomach about college is the tuition fees.In order to combat the rising tuition rates, students engage in a staple ritual of college life: obtaining student loans. Without them, most of us wouldn’t be able pursue a college career or afford the outrageous tuition. But most of us never thought one major culprit contributing to rising college costs may actually be the loans themselves, government-guaranteed student loans in particular. College tuition increases all the time, and as we know, UC is no different, with a possible increase in tuition for the 2010-11 school year. As it stands now, yearly tuition rates at UC for the 2009-10 academic years are currently $9,399 for in-state undergraduates and $12,723 for in-state graduates. Only a decade ago, yearly tuition rates were $4,998 for in-state undergraduates and about $5,880 for in-state graduates for the 1999-2000 academic year. Tuition has nearly doubled in 10 years; that’s a painful and significant difference.So the more tuition goes up, the more loans students take out, which in turn will contribute to future increases, keeping the cycle going.

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Tuition Costs Increase Despite Sour Economy

Posted By Christopher Johanning

The College Board’s latest study on college tuition shows that the price for college has risen by 6.5% — right in the teeth of the recession. But all is not lost. For students and families, there are some more pleasant figures in the study, too.BankingMyWay will open this — the week before Thanksgiving break for collegians — with a look at college prices going into 2010.The Big Kahuna of college cost barometers is the College Board’s annual tuition report. This year, the study says that the average price for four-year public colleges climbed $29 on a year-to-year basis to $7,020. Tuitions at private four-year colleges rose 4.4% for 2008-2009 bringing the average yearly cost to $26,273, the College Board says

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Fed Tightens Rules on Overdraft Fees

Written by: Lisa Matthys

Are you one of those consumers who look at their bank account to find that they had overcharged their account by $0.01? Many consumers, who purchase small ticket items with their debit cards, have the impression that the transaction simply won’t go through if there is not enough money in the account. However, that isn’t the case.

Some banks offer consumers an option for overdraft protection upon establishing their account with the bank. If declined, consumers who run their accounts close to zero are at a high risk of paying an additional fee if they overcharge their account (between $25 and $35). Banks generate approximately $38 billion a year nationwide. So for example, going over your account by $0.01, you will have to pay approximately $35.01 if you didn’t agree to an overdraft protection program.

However, not all banks market overdraft protection programs. Most banks silently and automatically enroll their customers into overdraft programs, and charge large fees for each overdraft purchase. The Federal Reserve has put in place new finance rules to ensure consumer protection. Customers will have to opt-in to overdraft protection programs before banks can charge them with overdraft fees on debit purchases and ATM withdrawals. These new rules will be implemented next summer.

Banks will be sure to complain, fight, and find loop holes, against this new financial rule because the overdraft charges account for a bulky portion of their profits. However, finance leaders in Congress feel that more needs to be done to protect consumers such as capping the number of overdraft fees allowed per year and prohibiting banks from manipulating the chronology of purchases in order to maximize the number of overdraft fees.

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Invest like Warren Buffet

Written by Michael Rivezzo

No,it's probably not economically possible for you to actually invest like Warren Buffet. His trading volume is in the billions and his investments usually signify ownershop of a company. He even gets a price that is strictly for the "VIP" investors. These stocks are commonly known as preferred shares.

Warren Buffet appears to have some cult like following in the business world. His books become instant New York Times Bestsellers and everytime he invests it makes the front page on every business journal. His company Berkshire Hathaway is currently trading over 100,000 dollars. Investors who are financially able to afford one share make it every year to the shareholder's meeting to hear Warren speak. He owns over 5% of Coke and didn't follow the whole dot come phase of the late 90's, which investors lost billions on.

But yet its still possible to invest like him regardless of assets. His strategy is yet simple for even the common investor. Invest in companies that are well-established, while yet undervalued. In the slang of investors, Buffet is a long trader, he holds shares for the long run. He learned the hard way that you must have patience with the stock market and he is known for several quotes regarding this.

""The stock market is designed to transfer money from the active to the patient."

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Paying for College 101

By Jorden Meltz

The past year and a half has affected the finances of everyone and the impact it had on colleges was no different. Creditors have begun to downgrade some Universities debt and now nearly one in every three private universities in planning for a decrease in tuition for the next year. This comes after the Student Aid and Financial Responsibility Act was passed in September, which will now eliminate college and universities need to rely on private sources for student loans and instead the loans will now come directly from the government. In response, Bank of America has suspended its federally-backed student loan program, as the U.S. prepares to phase out the Federal Family Education Loan Program. The new act will help to further ensure that families in need of loans to pay for college will have access to them through this federally backed program. The act comes as no surprise as the past year has seen both a decline in private sources making themselves available to give loans and a heavier reliance upon federal loans. Although students will not receive better interest rates on the loan, the act helps to make sure their is a larger pool of money to make loans with and that a greater number of people will have assistance in paying for their education if they need it.

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10 Secrets to Raising More Than $15,000 for College

Posted by Nick Porcell

Grandparents are pitching in. Students are working more, and eating less. Parents are taking out more and bigger federal loans.

As the economy has declined and college costs have risen, families have buckled down and become more resourceful to pay for college.

They have been so successful at funding tuition that college enrollment is up dramatically. A record 40 percent (or 11.5 million) of 18- to 24-year-olds are taking at least one college course this year. Add in all the adults returning to school because of the lousy job market, and the total number of college students is likely to exceed 19 million this year.

How are more students affording tuition even though many colleges' prices are at record highs and many scholarship programs, private lenders, and family savings accounts have been wiped out?

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Effects of the Recession Linger...

By: Robert Katz



While all experts seem to be saying that the recession is over, it is the after shock of this massive economic collapse that is definitely still effecting the American population. The worst part of all is that the real problems the recession created weren't even financial.
In today's American capitalist society, life seems to revolve around money and finances. Due to such high increases in unemployment and job opportunities families' financial situations have become the least of their worries. The plummet of the economy left most Americans unprepared for the years to come. Families have a lot to worry about with providing for kids, paying a morgage, car payments, insurance, saving for retirement, kids college, etc. The abortion rate in the US during this recession has increased substantially showing that families have had to alter their mind sets when thinking about starting a family. Yet, those already with a family that depend on a single income have been the ones that are really effected the most.
Inability to pay bills or even afford some of the luxuries we have come to take for granted in every day life have become out of their price range. This creates frustration and tension in families and more specifically problems in marriages. Marriage counseling has also had a surprising increase during a recession. This just shows the importance of saving and not being frivolous with your money. While always been worried that worst is coming isn't good either, it just never hurts to just be prepared and budget money wisely.

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Front-End Loaded Mortgages hurt Family Finances

Posted by Chris O'Sullivan

Interest on home mortgages is commonly "front-end" loaded, meaning lenders are making what some may consider unfair amounts of cash on your interest payments. Often times it may take 20 years to pay off only half of the principal on a 30 year mortgage. Front-end loads are structured in a way that requires the mortgage holder to pay off the interest first before chipping away at the principle.

If large interest payments in the early years really do generate excess profits for lenders, you would think that they would prefer 30-year to 15-year mortgages, because interest payments on the 15 decline much more rapidly. You would also suspect they should charge higher rates on 15s. However, they actually charge lower rates on 15s.

The way that lenders price loans is just the opposite of what we would expect if interest was front-end loaded. Lenders actually prefer shorter-term mortgages because their money turns over faster, which reduces their exposure to rising interest rates, and the more rapid pay-down of the balance reduces the risk of loss from default. This show why it is important to know the fine print in any contract that you sign.

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Real Estate Career

By Ka Lee Angel Lee

Real estate jobs are getting more popular and competitive. Everybody needs a place to live, to work, and if one is smart, investments in real estate can earn you a fortune.

Real estate jobs endow freedom, time flexibility, challenges and juicy rewards. If you are really interested, you can start by enrolling in some real estate courses in schools. There are licensing requirements for entry of the real estate job market. Therefore, some pre-licensing educational courses can definitely help you to get through more easily. Then you will start from the real life training and get your way into bigger firms.

There is a wide range of real estate jobs to choose from, from residential brokerage to commercial ones, from industrial and office brokerage to real estate appraising. It is important to find out which direction you want to aim at and your effort will be paid off.

Sources:

http://www.restatecareer.com/

http://www.realtor.org/REALTORorg.nsf/pages/careers

http://www.business.uc.edu/realestate/careerpaths

Investors Finding Deals in Real Estate Market

Posted by: Christina Dove

Although the housing market has taken some criticism and has struggled recently in the ongoing economic crisis, there is a glimmer of hope for some real estate investors. Many investors who have the money are able to take advantage of the slow economy's low prices and are getting great deals on houses. Especially with so many people foreclosing their homes and turning them over to the bank, it creates a lot of opportunities for people looking to buy a home or just a place to invest their money.

Housing prices are at an all time low and are attracting several types of people - those looking to buy their first home, those looking to relocate and those looking to invest their money and have a payoff in the future when the market returns to its normal conditions. Another benefit of entering the real estate market at this time is for the wide selection of homes that are on the market, with so many people getting out of their homes because they cannot afford them, it really opens up the doors for people with a little extra cash to get some great discounts on homes.

One issue in the housing market is that investors believe that the banks are being too leinent on people who cannot afford their homes. The banks are continuing to give out questionable loans to avoid foreclosures, but this is not helping the economy or the people who are living in these homes, strapped for cash. In order for our economy to get back on its feet, we will have to take stronger actions on people living in homes that they cannot afford and open them up to investors who have the fund to live in that caliber of homes. Therefore, in order for the real estate market to prosper and investors to get the most of their money and take advantage of the low housing prices, banks must be more aggressive in getting people to pay for their mortgages.

Sources:

http://money.cnn.com/news/newsfeeds/articles/prnewswire/200911110100PR_NEWS_USPR_____LA09203.htm

http://www.dsnews.com/articles/low-cost-foreclosures-attract-investors-2009-11-12

http://blogs.wsj.com/developments/2009/11/12/big-opportunities-for-real-estate-investors-reit-execs-skeptical/

How do you know what your Home is Worth?

Post by David Held

The first step in the process of selling your home is getting an appraisal, an estimate of what your house is worth. This is the key step in determining what to list your home for. The appraised value of your home most likely will not be the same as the “market value” for your home. Depending on the economy the appraised value might be more than the market value or some times less (not in your favor).

Ten Appraisal Tips are:

1. Continuously research the value of your home and homes in your neighborhood; pay attention to foreclosures in your area; they will drive down the value of your home.
2. Since appraisers use "comps" (comparable market sales) of local properties sold within the last six months to value your home, make sure to work with a great loan officer who will leverage their knowledge to research comps in your area, before ordering the appraisal.
3. If you use your own appraiser, research them first and ask your lender to cross check them for any potential issues that may delay the process. Great loan officers will always confirm your appraiser's credentials.
4. Direct your loan officer to work with local, experienced appraisal companies. Local appraisers have a deeper knowledge of the surrounding neighborhood and will likely be more readily available for the home inspection, to speed your appraisal process.
5. The appraisal report is yours to keep. Find out in advance who pays for the appraisal--many times appraisal fees are the homeowner's responsibility and have to be paid up front.
6. New lending regulations require two appraisals in some situations--ask at the beginning whether you'll need one or two.
7. Commit to your lender before committing to an appraisal. Being comfortable working with your loan officer is imperative. They often will be the liaison between you and the appraisal company.
8. Make sure any major repairs are completed before moving forward with your refinance. Structural damages drive your home value down and jeopardize the approval process for today's popular government-backed FHA loans.
9. Don't overestimate the value of making cosmetic home improvements. The expense is rarely justified because in the appraisal world, only improvements that add square footage will significantly increase home value.
10. Rely on market value rather than tax assessments for a realistic appraisal value--in today's market, tax value and current market value may differ widely, but your lender can only go by appraisal value.

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Best Places to Live 2009

Article by Luke Millins

Post by Shawn Chandok

With the decade winding to a close, Americans have grown increasingly reluctant to gas up their moving vans. Last year, the Census Bureau's national mover rate—which represents the percentage of Americans 1 year and older who moved within the past year—hit its lowest level since 1948, when the bureau began tracking the data. And who can blame us? In the face of a terrifying banking crisis, a historic housing crash, and a grueling recession, relocating to a new city isn't exactly on the to-do list. But despite the uncertain economy, the nation's diverse topography presents an enviable menu of great places to find work, retire, or just change your scene.

In selecting our Best Places to Live for 2009, U.S. News took a thrift-conscious approach: We looked for affordable communities that have strong economies and plenty of fun things to do. The cities we selected are as distinct as America itself—ranging from a quaint suburb to a live-music mecca. But whether you prefer hiking through the Rocky Mountains, pulling a fish out of the Atlantic Ocean, or grilling hot dogs at a college football tailgate, here are 10 places that will fill up your daybook without emptying your wallet.

1. Albuquerque, New Mexico
Along the banks of the Rio Grande, with the Sandia Mountains in the background, is the beautiful city of Albuquerque, N.M. The sunny climate and endless landscape have long drawn writers, poets, and artists to this spot, which includes an unconventional mix of American Indian, Hispanic, and Anglo cultures. But it's not just freethinkers who drift to this Southwestern city of 511,000. Kirtland Air Force Base, Sandia National Laboratories, and Intel Corp. have helped develop the area into a manufacturing and research hub. They provide a stable anchor for the local economy.

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There is hope

By Jonathan Tse



On the week of November 7th, there was an all time low of 502,000 first-time claims for unemployment insurance since the week of January 3rd. Some believe that this could be a sign that the problem of joblessness is beginning to be solved and that unemployment rates may begin to decline. This number of first-time job claims was much lower than expected since the estimate for this week was 510,000. It is believed that this is a sign that companies are cutting jobs at a slower pace than at the beginning of the year, but economists say that joblessness rates are expected to rise until they peak during mid-2010. The reason for this is that analysts say that claims must fall to approximately 450,000 or below to indicate that the economy is adding jobs. The concern that there will be a jobless recovery still worries many, but the government is working to improve the situation. President Obama announced that he plans to hold a new jobs forum and economic growth in December. Also, last week President Obama signed a bill that would provide 20 more weeks of jobless benefits to the unemployed. This plan will be funded by extending the long-standing unemployment tax on employers to 2011.

http://money.cnn.com/2009/11/12/news/economy/initial_claims/index.htm
http://www.reuters.com/article/ousivMolt/idUSN0243717320091112
http://www.nytimes.com/2009/11/13/business/economy/13econ.html?_r=1&ref=business

Asian Real Estate Investment Market Buoyed in 3Q

Posted By Shawn Gao

The Asian real estate investment market continued to gain momentum in the 3Q of 2009 as capital values generally stabilised, sentiment improved and the bid-ask spread narrowed, particularly for quality yield-accretive assets in prime locations.

Direct real estate investment in Asia jumped 25 percent quarter-on-quarter to an estimated US$9.1bn. Hong Kong accounted for 36 percent of the total volume followed by China, Korea and Taiwan. However, overall transaction volume remained low in the first nine months of 2009, falling by 49 percent year-on-year according to CB Richard Ellis’ 3Q 2009 Asia Investment MarketView report.

The office sector attracted US$4.7bn of investment during the quarter, or 52 percent of the total flow of capital. Residential properties accounted for 16 percent, with the retail sector comprising 13 percent of the total volume. Despite the relatively low transaction volume in the hospitality sector, a total of six hotel transactions worth a combined total of US$300m were concluded during the quarter, surpassing within three months the five transactions recorded in the first six months of 2009. Transactions involving industrial properties also showed signs of improvement with a total of 24 deals concluded between July to September, a similar figure to the total number of deals completed in the first six months of the year.
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How to invest $10,000 right now

By Harry Domash

Posted by Lily Mei

You're not rich. You own a few mutual funds in a 401k or an individual retirement account. And you're ready to take the next step: to buy a few stocks with $10,000 or so sitting in certificates of deposit or languishing in a bank account.

But how do you get started?

Let's begin by admitting this much: All of us, no matter how good we are at stock picking, are going to pick an occasional loser. That's why diversification is important. How many stocks must you own? Opinions vary, but dividing your $10,000 into 10 chunks of $1,000 each is probably sufficient. With many discount brokers charging less than $10 a trade, the commissions won't be significant.

However, different folks have different investment needs. I'll describe three strategies, including links to screens to see today's picks. Feel free to mix and match the stocks turned up by the screens or stick with the strategy that best suits your needs.

I used free online tools to build these three screens. The first two use StockScreen123, arguably the most capable free screening tool available on the Web. The third uses the Finviz.com screener, which I find easier to use but not as capable.

As tools, screens work best if rebalanced every six months. Rebalancing means that after six months, you'd rerun the screen and update the portfolio based on the new screen results.

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