DrBoyceConsumerFinance

A beam of light at the end of the recession

2009-12-11T20:46:00.001-08:00

By Alma Zhumagulova

Consumer spending amounts for about two thirds of the economy. This in effect implies that in order to recover from the recession people have to start spending. However, this is not so easy given the current unemployment rate. Even if it has recently gone down from 10.2% to 10%, it is still 15.4 million people who are out of job and barely making their ends meet.
Speaking of retail sales, November sales have shown a sign of optimism – a rise of 1.3% from October. This year, Black Friday spending went up from the last years; however much of it was due to the deep discounts offered by retailers in their battle for increasing their sales. The winners in this battle were electronics; the average price of laptops was $475 compared to $638 last year. Hence, the volume of sales increased while still leaving the retailers at a loss.
A relatively new sales tactic – Cyber Monday – Monday after thanksgiving holiday, when various retailers offer deep discounts to online shoppers, also contributed to this rise, when on November 30, the sales rose by 5% to $887 but almost immediately went down after the discounts were no longer offered.
Overall, U.S. retail sales have increased “for the 13th straight week in the beginning of December.” If the trend continues, this will at least give the US economy a beam of light at the end of the tunnel called recession.

Sources:
http://www.nytimes.com/2009/12/12/business/economy/12econ.html?ref=business
http://www.reuters.com/article/idUSTRE5B754R20091208?type=technologyNews
http://www.bloomberg.com/apps/news?pid=20601103&sid=aNKDZCfx490U
http://www.latimes.com/business/la-fi-gadgets10-2009dec10,0,7461798.story

Sales have increased

2009-12-11T20:32:00.000-08:00

By Jameel Murray

It is reported that retail sales have increased this year, which indicates growth in the U.S economy. According to Bloomberg.com, consumer confidence is increasing more than forecasts have predicted. Because consumer purchasing backs the economy, there have been a significant increase in the stock market lately. The Dow has reported a new high and the S & P as well as Nasdaq have performed considerably well. Throughout the month of November, sales have increased 1.3 percent, twice the amount it was forecasted to be. One main reason for these increases are the spike in sales promotions from multiple merchants.
U.S retail figures have also displayed increases in inventories and exports, which encouraged economists to increase forecasts for the fourth quarter. This holiday, merchants are expected to offer a great deal of sales, which may increase retail sales, even more. Although retail sales are increasing, the unemployment rate is still significantly high. Many have not understood the contradicting facts. One reason for the stock market’s improved performance along with a high unemployment rate is due in part to the lay offs of many salaries for companies. Because companies cut many salaries, due to a decrease in costs they were able to produce higher revenues.

http://www.bloomberg.com/apps/news?pid=20601103&sid=aLdAOm6kbtEU

http://www.ft.com/cms/s/0/ade75720-e659-11de-bcbe-00144feab49a.html

http://money.cnn.com/2009/12/11/news/economy/retail_sales/

The great debate

2009-12-11T20:27:00.000-08:00

By Jameel Murray

This holiday, parents would be faced with one of the most difficult decisions ever. This decision has haunted many consumers and even leads to an increase in blog reading. Consumers would have to make the ultimate decision of purchasing a Xbox 360 or a Playstation 3. Both systems have advantages as well as disadvantages. We would first examine the price line. The Xbox has recently offered customers a great deal, bundling two games with the much-improved Xbox 360 Elite console for a considerably cheap price of $299. In an attempt to match Xbox’s strategy, Playstation has also cut the price of their PS3 console to $299 without the two free games included. If consumers are searching for value, their best bet is to settle for an Xbox 360 just because you are able to enjoy two games straight out of the box for free.
The two consoles are considered high performance game consoles, boasting innovative game processors similar to high-end pc gaming machines. While graphics are similar, the Xbox 360 offers better games and a interactive online gaming experience. For consumers seeking the full gaming experience, the 360 should be the right choice.
The obvious difference between the Xbox 360 and the PS3 is the fact that the Playstation 3 offers consumers the chance to watch movies utilizing the new Blu Ray technology. For consumers who are movie fanatics and prefer to watch their movies in the best quality available, the PS3 is their choice. I hope reading this article makes your decision even more difficult because both consoles are great and extremely valuable.

http://www.us.playstation.com/

http://www.digitaltrends.com/gaming/media-center-showdown-xbox-360-vs-playstation-3/

http://www.xbox.com/

How to save this holiday

2009-12-11T20:25:00.000-08:00

by Jameel Murray

This holiday, people are expected to spend a vast amount of their budget on gifts for loved ones and in most cases themselves. Stores are gearing up to experience a sharp incline in their baseline sales by offering a ton of unbelievable deals particularly online. Similar to the Black Friday shopping event, Christmas is a holiday where many shoppers are brainwashed into squandering a great amount of their money. There are several options to help save money during this upcoming holiday season. One first suggestion in shopping online is to take advantage of free shipping options. Shipping usually adds a couple extra dollars that can be avoided to one’s purchase. Website such as freeshipping.org offers coupons to over thousands of stores. Customers should mark down December 17th as free shipping day for online stores. A second suggestion for saving is to utilize the cash back option. Many stores offer money back. Stores also offer gift cards to customers. Customers can go to giftcards.com and purchase cheap gift cards to various stores. Other websites such as Mybarginbuddy.com offers a list of deals to customers. Finally, dealio.com compares prices on products from over 100,000 online stores. Expect to save a great deal of money this holiday.

http://www2.wspa.com/spa/news/consumer/article/top_7_ways_to_save_online_on_holiday_shopping/30777/

http://wwwfreeshipping.org/

http://www.giftcards.com/

Personal Branding Trend

2009-12-11T19:49:00.000-08:00

By Ka Lee Angel Lee

Market powers are always in the hands of brand-name companies who have to determine the most effective use of their assets across markets. The value of brands can be seen in recent acquisition where prices have been many times over the book value of the company purchased. While branding for companies are becoming one of the most fierce contests in business, before going to anywhere, however, you are actually the first thing and most important thing to sell to the public. Therefore the first step is to brand manage yourself.

First of all, just like what business does, you have to find yourself a target market. That is “where you perceive yourself in?” “Do you regard yourself to be an aggressive athlete or loving social worker?” Then you need to access if you have all the assets i.e. education, experience, passion. Then you will need all the resources to build it like getting into the right network, finding the right companies. Remember, your brand is very important to you. Therefore brand protection is essential too. Be aware of the information you put online especially.

Sources
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Branding

2009-12-11T19:14:00.000-08:00

By Ka Lee Angel Lee

A brand was said to be responsible for 18% of the total purchase decision by studies. Individuals can establish a brand-loyal psyche and that affects their choice of goods heavily. Branding thus is one of the most important beneficiaries of a well-conducted portfolio analysis. They shape customer decisions and ultimately create economic values. From the website, the top 100 global brands’ ranking was fluctuating every year. Some rocket to the top while some drop to the bottom all the time. Since the brandname phenomenon influence purchase decisions substantially, the different rankings of brands can be explained by their own company’s brand and product management which includes positioning, product, place, promotion and pricing decisions of the goods a particular company wants to provide.

The brand building competition between companies benefits not only to the companies but to the customers. Customers can then enjoy better and more advanced products. Many companies do market researches on customers’ needs and tastes. Therefore products are more tailored to our needs when companies fight to building brand loyalty in customers.

Source 1 2 3

Black Friday Mayhem, Is It Really Worth It?

2009-12-11T13:24:00.000-08:00

By: Kelsey Hoffman

The second greatest things about the Thanksgiving break are the festivities the morning after the feast, Black Friday shopping deals. People line up hours in advance to get the deepest discounts on items for their holiday shopping needs, and this year was really no exception. More than $10.66 billion was spent on Black Friday this season. Sounds like a lot, but numbers showed that the amount of money that was spent relative to the amount of people who shopped was significantly lower than the numbers from last year. I guess that’s what happens when a recession hits!

This was not to say that stores did not still have strong sales on Black Friday. Walmart reported that their sales of Blu-Ray players were up 53% from the numbers last year. They also reported that the Playstation 3 sales hit record highs during the Thanksgiving week. Retail sales in general also jumped 1.3% in November, according to the Commerce Department, well more than the expected increase.

A new trend this year was the use of social media to spread the word about Black Friday deals. Because many companies did not have extensive advertising budgets due to the economy, many dedicated a small group of people to spreading word via Twitter and Facebook. They could have potentially reached 20% of their consumer base this way, and it seemed to have paid off.

Sources:
http://news.punchjump.com/article.php?id=9153
http://money.cnn.com/2009/12/11/news/economy/retail_sales/
http://thesocialrobot.com/2009/12/did-social-media-save-black-friday/

BCS System all about the $$$

2009-12-10T23:34:00.000-08:00

Posted by Chris O'Sullivan

College football's postseason has been a frequent subject of debate on a regular basis due to a flawed system known the BCS. This computer system pairs the top two teams in the country to play for the national championship each year. However, many argue that system in simply in place to make sure the two "most popular" teams play in the game each year.

Many are now looking to the federal government for help in destroying this system. Just take a quick glance at the annual payouts of the 34 existing bowl games. The five BCS bowl games pay out $17 million a game ($85 million total), while the 29 other bowl games divide a total payout of less than half that ($41.8 million).

Not only are smaller, less popular schools missing out on the opportunity to play in these games, but the system is allowing the rich to get richer and the system to preserve itself on an annual basis. Without the money and exposure these games provide, smaller schools remain at the bottom and the larger, more prestigious schools collect massive checks used to further increase their competitive advantage over the "have nots." It is clear that this system is flawed and needs to changed as soon as possible.

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Wendys Chain to Withdraw from Japanese Market

2009-12-10T21:38:00.000-08:00

Posted by Chris O'Sullivan

Wendy's has announced that they will remove their restaurants from Japan after a seven year presence in the Asian market. Wendy's is currently the third most popular burger chain in the US behind McDonalds and Burger King. However, the Asian market apparently did not offer the same amount of support for the franchise. All restaurants will be closed by the end of December in a market that has been dominated by McDonalds.

Zensho, which has operate the 71 Wendys restaurants in Japan, claims it will now turn its focus to beef-bowl restaurants (whatever that is). While Wendys has generated modest profits in the Japanese market, it could not overcome industry giant McDonalds which currently holds a 65% market share in the country.

McDonalds first moved into the Japanese market in 1971 and there are currently over 3,700 stores in the country. In comparison, Burger King currently operates only 16 stores in Japan. It appears unlikely that any American fast food chain will be able to top McDonalds in its dominance of the Asian market.

Sources:
source 1
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Video Games Sales Slumping

2009-12-10T21:12:00.000-08:00

Posted by Chris O'Sullivan

The video game industry is apparently not immune to our current recession, as evidenced by declining sales over the past nine months. During the crucial holiday month of November sales were no different. According to industry analyst The NPD Group, sales across the entire video game business were $2.7 billion, down 7.6 percent from $2.92 billion a year earlier.

These figures are slightly misleading however because 2008 was the best year ever for video game sales. This means that game producers are still making a great deal of money although it may be less than what was earned last year. Sony has recently dropped the price tag on its premier console Playstation 3, but the system continues to lag in sales behind the Nintendo Wii and Xbox 360.

"Nintendo products top Amazon.com's most wished for and most gifted lists for video games, and Wii remains at or near the top of the most-searched for video game terms on Yahoo," Nintendo said in a statement. "As families and friends gather for the holidays, Nintendo games offer the best shared experiences." The top selling game was Modern Warfare for Xbox, which broke the single-day record for sales for any entertainment product when it launched November 10.

Sources:
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Tiger could cost PGA Millions of Dollars

2009-12-10T19:03:00.000-08:00

Posted by Chris O'Sullivan

Unless you live under a rock, you have probably heard about Tiger Woods and his recent scandal involving his relationships with several women not named "Elin." While this ordeal has obviously cost Tiger in terms of his public image, the financial effects of this incident are trickling down to other aspects of his life, including the PGA Tour.

Tiger is undoubtedly the best golfer in the world and the primary reason many people watch golf. Most recently, Tiger missed his own tournament in California in the days following his car accident. In 2008, when Tiger missed the PGA Championship, TV ratings dropped 55 percent. In a time when corporate sponsors are becoming more stingy with their dollars, the PGA Tour needs Tiger to capitalize on the largest possible audience.

While many agree that Tiger's life will eventually return to normal, there is no arguing the immediate effects Tiger's scandal has had on the industry. Tiger currently earns around $130 million in TV commercials, and none of these ads have been aired recently.

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"I'd Rather Be in Prison"

2009-12-10T12:12:00.000-08:00

By: Zachary Pienkowski

With college campuses being bombarded with credit card booths and the cost of college life increasing, many students find themselves up to their ears in debt. One of the best lessons that a young person can learn in that piling up credit card debt can happen in no time, but paying it off may take a lifetime. MSNBC wrote an article about a college student that was in over $5000 of credit card debt and $50,000 of student loan debt before he even entered the workforce. This is not an unusual or rare situation anymore, as college tuition prices rising by double and sometimes triple the rate of inflation. The problem is not only are kids floundering in debt, but many cant find good jobs to even make any headway on the loans. The economic downturn has affected everything and everyone despite economic status. A growing number of students feel that going to college was the biggest mistake of their life because of how far back they set themselves in debt. Retirement or housing plans are not even in mind because there is no amount of money to be saved, only to pay off debt.There is an overwhelming feeling that students coming out of college or even in college can not get ahead because every time they make payments, another huge expense from school comes up. 9 out of 10 students have said they have used credit cards to pay for things like textbooks at school. Most of the cards are not paid of completely each month leaving students with enormous amounts of interest to pay off. A major reason for this problem is that the cost of education continues to skyrocket while financial aid has remained steady. In order to stay in school, many are forced to charge the difference and hope they can pay it off at some point, in many cases destroying credit ratings along the way.

Sources:

http://redtape.msnbc.com/2009/05/college-debt-so-crushing-grad-says-i-wish-id-gone-to-prison-instead.html

http://www.cardratings.com/studentcreditcarddebt.html

http://www.bankrate.com/brm/news/cc/19980605.asp

Investing in Stocks

2009-12-10T08:15:00.000-08:00

Post by David Held

Playing the stock market game with your money can be hit or miss. Consumers are looking for safe investments that will ultimately make them some money before retirement. Many people turn to stocks, but the way the economy has been for the past 18 months the stock market seems to be extremely volatile. Stocks such as Goldman Sachs, Apple, and Google have gone down over 50%, then came back up 100%. If you were one of the investors who could the market on the down slope, you could have potential lost half of your retirement savings, but catching the market on the way back up could have doubled your savings. As previously stated stocks are risky business. Depending on your monetary situation stocks might not be the move.

Mutual funds have also been proven to be volatile. The standard mutual fund, Vanguard 500 Index, which mirrors the S&P 500 also cut in half over the recession and has not made it completely back like the stocks have. The scary part is many retirement funds (401K’s) are tied into these mutual funds, so all these people can do is sit back and watch, but it doesn’t look like the funds are making it back too soon.

The safest way to invest is in treasury notes, bonds, and bills because all of these securities are backed by the US treasury. So the chances of a default are slim to none. Make sure you do your research before you invest!

Sources #1, #2, #3

What type of car should I get?

2009-12-09T09:13:00.000-08:00

Post by David Held

One of the most important burdensome financial decisions that you will have to make is purchasing a car. Now, the questions that arise are what type of car should I buy, should I buy it or lease it, and should I purchase an extended warranty with the car?

TYPE OF CAR: When deciding what type of car you should buy, you first have to access how much you are willing to spend. After figuring out your budget you have to consult what are your needs in a car. Do you need it to go to work and back, weekend mobility, for your child to go to school? Then, finally you have to look at the location that you reside in. If you live in Florida you do not need four wheel drive, but if you live in Vermont you need four wheel drive and maybe even an SUV for ground clearance issues.

LEASE OR BUY: Depending on your money situation is how you make a decision on whether to lease or buy. Most people do not have a lump sum of money to throw down for a car, so leasing will not cripple your financial position. Buying increases your assets (net worth), but once you go over your factory warranty, the costs of repairs can be burdensome.

Extended Warranties: If you lease for a modest amount of time (39 months or less), there is no need for an extended warranty. If buy a car and plan on having it for a while, you should definitely look for extra warranties for your car.

Sources #1, #2, #3

Hollywood's 10 Most Overpaid Stars

2009-12-08T18:09:00.000-08:00

Posted By Ahmed Al-Salem

What it all comes down to when paying actors to play a part in a movie is whether they will make that movie profitable. Paying a certain actor a big salary is a sort of investment on the part of the movie studios to make their movies more appealing to the public and therefor generate more revenue. What happens when you pay certain actors huge salalaries and their movies flop and end up making you a loss? Forbes generated a formula and a list based on that formula calculating each actor's return on investment.

"To create our list, we looked at the 100 biggest stars in Hollywood. To qualify, each actor had to have starred over the last five years in at least three movies that opened in more than 500 theaters. We calculated each star's estimated earnings on each film, including up-front pay and any earnings from the film's box office receipts, DVD and TV sales. We then looked at each movie's estimated budget (not including marketing costs, which are susceptible to accounting chicanery) and box office, DVD and television earnings to figure out an operating income for each film. We added up each star's compensation on his or her last three films and the operating income on those films and divided total operating income by the star's total compensation to come up with each return-on-investment number."

Based on this calculation Will Ferrel is number one. This summer's Land of the Lost flopped, earning only $65 million on an estimated budget of $100 million. That pushed Ferrell to the top of our overpaid list. For every $1 Ferrell was paid, his films earned an average $3.29.

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New Young Credit Cards

2009-12-08T17:14:00.000-08:00

Posted By Pete Hill

As of Feb. 22, a new law will bar banks from a host of practices that consumer advocates have long blasted as unfair

The problem for consumers is that the prime rate is at 3.25%, a historic low. It will almost certainly go up. And so will credit card rates, which currently average 14.9%, according to the Federal Reserve.

While most credit card holders already have variable-rate cards, banks have been busy these past few months making sure nearly all customers have those kinds of cards. The credit card reforms outlawed some seriously abusive practices, but the cards will still be loaded with other tricks and traps

For a couple of months now, American Express has been running an ad campaign for its charge cards aimed in part at consumers who are trying to be more responsible with their money. Amex introduced the Zync card, a charge card aimed at people in their 20s. Here is how the card works. “The basic card costs $25 each year and includes participation in the Amex Membership Rewards Points Program, though it does require you to pay off your balance every month. You can choose from among four “packs” that yield extra goodies. The Go pack, for instance, costs another $20 annually and doubles the points you earn on airfare. The Social pack has the same price and doubles points for restaurant, concert and theater purchases.”

Sources:
http://moneycentral.msn.com/banking/services/creditcard.asp
http://bucks.blogs.nytimes.com/2009/12/08/american-express-zync-will-young-adults-want-a-charge-card/?ref=your-money
http://money.cnn.com/2009/12/02/news/economy/credit_card_rates/index.htm

Average Debt for Graduating College Seniors Rises to $23,200

2009-12-08T12:05:00.000-08:00

Article by JACQUES STEINBERG

Post by SHAWN CHANDOK

Yet another study has been released that will provide scant comfort to those college applicants, and their parents, who intend to take out loans to pay for their education.

Students who graduated from college in 2008 with loans carried an average debt of $23,200 — an increase of nearly 25 percent, or $4,550, when compared with those who graduated just four years earlier. These figures appear in the latest study by the Project on Student Debt, an initiative of the Institute for College Access and Success, a nonprofit organization.

The report also notes that “employment prospects for young college graduates have soured along with the economy.” Citing unpublished data from the Bureau of Labor Statistics, the researchers report that the unemployment rate for college graduates between the ages of 20 and 24 was 7.6 percent in the third quarter of 2008, “the highest third-quarter rate since 2002.” By the third quarter of this year it was 10.6 percent, “the highest on record.”

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Avoiding Airline Fees

2009-12-07T19:42:00.000-08:00

By Leah Gorham

Air travel has become more and more inconvenient in recent years as lines become longer, delays become more prevalent, and fees become more widespread. However, by identifying some of the fees that airlines want to keep hidden from consumers, we can avoid paying surcharges that can ruin your travel budget.

Airline fees include fees for checked baggage, beverages, seating with leg room, increased fees for unaccompanied minors, and fees for award tickets. But there are ways to cap the cost of your flight at its ticket price with a little careful planning. For instance, the most common-sense solution for avoiding checked baggage fees is to carry-on instead. That will save you $15-$25 per bag depending on the airline. By packing light and carrying on, your ticket price will stay lower. If you need to check baggage, ensure that your baggage does not go over weight requirements. An overweight bag may cost up to $175 (Delta airlines). To avoid costs on seating, check in online just prior to your flight (most airlines open up online check-in 24 hours before scheduled departures), when non-assigned seating inventory usually opens up to all passengers.

Avoid fees on awards points and frequent flier miles by cashing in your frequent flier miles before the deadline or use your awards for something else. Several airlines — including United, American, and Continental — will waive baggage fees if you are an elite member of their frequent flyer program. So becoming a member of a frequent flier mile club is a good way to reduce extra costs on your airlines tickets over time.

Overall, it is important for consumers to be aware of these fees and to avoid the fees they can when traveling by planning ahead.

Source 1, Source 2, Source 3

Cyber Monday Gives Some Hope

2009-12-06T23:37:00.000-08:00

By Mary Clare McGraw

Although Black Friday was a disappointment for many retailers, Cyber Monday certainly proved to be more promising. The Monday following Thanksgiving has been dubbed “Cyber Monday,” during which online retailers offer big discounts and free shipping to entice shoppers to spend enthusiastically online. This year, Cyber Monday sales rose 14% from 2008 and consumers bought nearly 30% more items per order, according to research firm Coremetrics. They also recorded information revealing that shoppers bought 10% more items per order online than that did on Black Friday of this year.
This increase in online sales, especially in relation to Black Friday in-store sales, could be attributed to the consumer’s willingness to spend more online because it is simply the most convenient way to shop. Online traffic surged 43% on Monday as Americans searched for deals from their homes or workplaces. Shoppers, this year, are focused on value and although online sales were up on Monday, November 30th, there is no saying how the remainder of the holiday season will pan out. The National Retail Federation expects holiday sales to decline 1% this year, which is a relative improvement from the 3.4% drop in holiday sales last year.

Source 1, Source 2, Source 3

Black Friday Shows Consumer Doubt

2009-12-06T23:08:00.000-08:00

By Mary Clare McGraw

This year there was much speculation with how Black Friday would have an effect on the retailers nationwide. A record 195 million shoppers were out looking for deals in stores and online between Thanksgiving and Sunday, November 29th, which, according to the National Retail Federation, was up from the 172 million shoppers during the same time period in 2008. The troubling, yet perhaps expected, phenomenon that took place on the holiday weekend was that average spending dropped to $343.31 per person from last year’s $372.57. These statistics could be a reflection of a lack of consumer confidence due to a still high unemployment rate of more than 10% and a dwindling effect of the stimulus packages given out to companies in the United States.
With a continued weak job market, consumer discretionary spending will also continue to struggle and retailers will not get that big boost they were hoping for. Specialty stores such as Abercrombie & Fitch saw as much as a 17% slump in sales compared to the year before. With consumers increasingly turning to discount retailers and warehouse clubs, specialty stores are finding it difficult to appeal to the fundamental needs of Americans who are shaken by the current economy.

Source 1
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Noise, Vibration, and Harshness: Rise and Fall of Consumer Finance

2009-12-06T22:31:00.000-08:00

Article By: Jamie Kitman
Posted By: Srividya Srinivasan

Maybe Adolf Hitler got it right. I don't mean the part about world domination, the master race, or all the illing and killing for which he's so justifiably reviled. I'm talking about consumer credit and the way the Third Reich got hard-working citizens to divert a little bit from their pay packet each week to purchase their very own Volkswagen. Theirs to use and enjoy, once they'd finished paying for it. In advance.

The practice seems exactly backward in a world where the idea is to sell as many cars as possible. Compare our U.S. system, pioneered by John Jakob Raskob for GM in the 1920s, wherein John Q. Public gets the car first and finishes paying later, in monthly installments. Hopefully before the car falls apart.

Aggressive consumer financing -not some fascist savings account but real, easy, right-here-now credit-became the great engine of American economic prosperity during the twentieth century. It has sold a lot of cars, agreeable finance being the mother's milk of car selling, in which immediate gratification is the whole point. The only things meant to concern us about the future are our ability to make payments and our next new car. This has been the American way longer than any of us have been alive.

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Consumer Finance Scams

2009-12-06T22:24:00.000-08:00

Article by: Srividya Srinivasan

When consumers encounter financial troubles, sometimes they sink too deep and credit problems arise as a result. Consumer finance scams often keep their fees at a relatively low rate to attract consumers facing financial burdens. These types of consumers are the primary targeted audience for fraud promoters since these specific consumers are most willing to pay money for these services. The result of affordable rates is that consumers that can pay for these services; however, they are often the individuals that can absorb the least amount of economic injuries caused by fraud.

FTC law enforcement efforts have been placed to emphasize fraud promoters that promise financial service assistance to consumers at high rates to take advantage of vulnerabilities. The consumers facing hardship would like nothing better than to rid themselves of these financial burdens; unfortunately, fraudulent activities usually target these consumers. These fraud promoters often charge high rates for a service they can not guarantee to provide in the end.

How can fraudulent scams earn promoters so much money when consumers are facing financial challenges? Consumer finance scams keep their fees low enough so that the aforementioned type of consumers can afford them. Fraud promoters usually receive a large profit by mass marketing their services to millions of consumers and, thus, reaping a higher monetary reward. Given these marketing techniques that enable fraudulent activities to generate more consumers, more law enforcement is clearly necessary.

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Consumer spending is up

2009-12-06T19:05:00.000-08:00

Posted by Michael Rivezzo

More Shoppers Hit Stores, but Spend Less Each

2009-12-06T19:00:00.000-08:00

Written by By ELIZABETH HOLMES, ANN ZIMMERMAN AND RACHEL DODES
Posted by Michael Rivezzo

Many more shoppers turned out for the traditional start of the Christmas shopping season over Thanksgiving weekend than a year ago, but they spent less each and favored lower-priced items.

That's a mixed bag for the beleaguered retail industry, which hopes that tight inventory combined with targeted bargains will ring up better results than last year's gloomy holiday season.

Roughly 195 million consumers shopped in stores and online over the Black Friday weekend, up from 172 million last year, according to the National Retail Federation. But average spending dropped to $343.31 per person from $372.57 a year ago.

Overall sales for the four-day weekend totaled $41.2 billion, up marginally from $41 billion last year, the NRF estimated. The trade group bases its figures on a survey, conducted Thursday through Saturday, of roughly 5,000 consumers and includes a projection for Sunday.

"The appetite among consumers this year seems to trend toward the lower-price items, the items they could literally afford with the money they already have in their wallet," said Ellen Davis, vice president of the Washington-based retail group, which has predicted a 1% decrease in November and December sales this year over last.

The holiday season—when many retailers make the bulk of their sales and profits for the year—is being closely watched by economists and others as an indicator of whether consumers are still deeply worried about the economy and unemployment, and are hampered by tight credit. After a disastrous season last year, retailers have ratcheted down sales expectations while slimming their stocks and filling the shelves with cheaper goods.
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What Does Santa Wants for Xmas?

2009-12-06T18:41:00.001-08:00

By Quang Nguyen

It is that time of the year when children everywhere look forward to Santa for a gift. But have you ever wondered what does Santa want? Can you guess? Well for this year's Xmas, Santa's most wanted gifts are H1N1 flu shot and hand sanitizer.

Contacting with thousands of kids everyday until Christmas Eve, Santa does not want to get sick. Swine flu is becoming Santa's most dangerous work related hazard. The question is should all Santas get the H1N1 flu shot and answer is definitely yes. It is the top priority for Santas as well as their employers.

However, the flu shots are limited in many states, making it difficult for all Santas to get to the safe zone. According to the Centers for Disease Control and Prevention (CDC), Santas are not classified as the priority high risk group in order to get the vaccine.

What even more dangerous for Santas is the fact about their demographic. Many of them are currently facing health risk with overweight. 1/3 of all Santas are estimated to be morbidly obese. Research has shown that obesity is one of the risk factor for severe swine flu. Experts advise Santas to wash their clothes daily instead of weekly to prevent germs. In addition, they also say that Santas should not wear gloves this year so they can wash their hands more frequently.

Sources:
http://money.cnn.com/2009/12/04/news/economy/santa_claus_swine_flu_vaccine/index.htm
http://wbztv.com/local/santa.claus.swine.2.1319764.html
http://www.msnbc.msn.com/id/33997901/ns/health-cold_and_flu/

Sample Sales: Now Online

2009-12-06T18:02:00.000-08:00

By Quang Nguyen

Sample Sales are what many consumers, mostly women, looking forward to. The products of many famous brands will be sold with much lower price and with new styles people can't resist. However, customers usually have to stand in line for a long time in order to get into the stores on these sample sale events. Thanks to technology, now you can all buy sample products at home through online websites.

Get excited girls, you can all check out these wonderful websites: http://www.gilt.com/, http://www.ruelala.com/, https://www.onekingslane.com, http://www.ideeli.com/, http://www.hautelook.com/. Customers love the new innovation strategy. They now can purchase their favorite items without the rush at the stores.

Traditionally, sample sales are on invitation only basis and the quantities of products are very limited. However, with the thrill of saving as much as 70% on new items, people are going crazy for sample sales. This is when online comes in. Often the sales would be for a limited time, usually 24-48 hours, and customers have to sign up an account in order to participate. Even signing up is a difficult task because you most often will need a referral from a current member. Once you sign in, you will get emails telling you the next sample sales.

People who are tagged as shopaholics works hard to get the best deals. To them, the online websites are designed as a game. To win the game is to successfully buy the items. High demand and low supply plus low price results in an online war. Good luck to you on the fashion hunting season.

Sources:
http://www.nytimes.com/2009/12/07/technology/internet/07private.html?ref=business
http://www.sheknows.com/articles/806279.htm
http://nymag.com/shopping/articles/sb/

New Rules for Gift Cards

2009-12-06T16:28:00.000-08:00

Written by: Lisa Matthys

In the season of gift giving, many people struggle trying to find that perfect gift for their friends, family, or significant other. Why go through the heartache of trying to find that perfect gift when you could simply give them a visa or mastercard gift card? Consumers are able to spend it as a gift card but with fewer restrictions on where they can use it. However, the main concern with these type of gift cards is that they charge additional fees for its inactivity, diminishing the amount available.

The Federal Reserve has proposed new regulations aimed at limiting fees and expiration dates of gift cards. The new rules would limit card issuers to charge no more than one inactivity, dormancy, or service fee a month. It would also require funds to be usable for at least five years after a card is issued or last funded. The National Retail Federation expects that the changes will affect banks more than retailers as most retailers have pulled back from expiration dates and other various fees. Also, the new proposed regulation could hurt some state governments who depend on unused gift-card credit from issuers. But these implications will not be in place until August of next year too late for this years holiday season.

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Community Banks Have Operated the Right Way

2009-12-06T16:06:00.000-08:00

Written by: Lisa Matthys

Posted by: Courier Post Online

In 1969, a short 40 years ago, there were 17,000 banks in this nation. Today, there are less than half of that number -- about 8,000 -- and 105 of them have failed so far this year.

Just don't blame your local community banks. We're not the problem. It was 19 of the mega-institutions that precipitated the current financial crisis. Unfairly, the federal government is punishing everyone. Worse than unfair, some of the actions the feds are taking are deepening the problem.

Blame bad banking practices. Blame the economy.

It's time for the larger banks to be responsible, getting back to banking basics. It's also time for the consumer to speak up, and by doing so they can protect their personal assets, support their local community and help bolster the national economy. We have to stop the financial bleeding now, and grow our economy back into good health.

As the bigger banks continue to struggle and curtail lending, and as the recession deepens, worsening the plights of the mega-institutions, the community banks still are accepting deposits and making loans supporting the people and communities we serve. We're owned locally and live locally. We're the ones buying uniforms for the Little League teams and sponsoring the local charity events. We know our customers and they know us and place their trust in us. We take that to heart.

Click to read more.

Black Friday or Cyber Monday?

2009-12-06T15:53:00.000-08:00

By Minjune Kim

Black Friday & Cyber Monday: Some Quick Facts

• Black Friday spending rose 0.5%, ($54 million), to $10.7 billion, this year from last year.
• Online sales up 17% (Thurs. to Sun.) over the same period last year.
• Cyber Monday up 11%, more than they did a year ago.
• Shoppers spent less per transaction: the average size of each sales ticket decreased nearly 14% from last year.
• Amazon.com and Walmart.com were the most visited online shopping sites.

This holiday season shoppers found deep discounts in a competitive Black Friday and Cyber Monday. Approximately 195 million shoppers, an increase from 172 million last year, either shopped at stores or online over the Black Friday weekend, typically the Friday, Saturday and Sunday after Thanksgiving. The National Retail Federation reports sales totaled $41.2 billion, up slightly from $41 billion reported during the four-day weekend last year

John Gerlach, a professor of Finance at Sacred Heart University, prefers cyber-shopping to walking the malls to purchase holiday gifts for friends and relatives.
"I prefer to do as much as I can online," Gerlach said. "I can shop that way on my schedule, even late at night. Online stores don't close. And, of course, there are no crowds. We're seeing more and more people doing their holiday shopping online."
Gerlach is part of a swelling crowd of online shoppers that have retailers catering to cyber-customers with special deals as well as reduced or no shipping charges. In fact, many online retailers have noticed a spike in sales on the Monday after Black Friday. The trend has grown to the point that online retailers typically refer to this day as "Cyber Monday."

You can't throw a rock without hitting an online retailer prognosticating about Internet holiday shopping trends. HauteLook, an online retailer that does limited-time sale events, said that from Nov. 26 to Nov. 30, sales rose 500 percent compared with the same period last year. According to a Shop.org survey, 96.5 million Americans said they'd shop on Cyber Monday this year, up from 85 million in 2008. But according to ComScore, those estimates are wildly high. It says that only 8.7 million people made online purchases on Cyber Monday and that retail e-commerce spending rose just 5 percent, to $887 million. Coremetrics painted a rosier picture of Cyber Monday: Compared with 2008, it said, sales were up 13.7 percent and the average amount consumers spent on each order was up 38.2 percent.

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CONSUMER FINANCE: Online Tools To Make Holiday Shopping Easy

2009-12-06T15:35:00.000-08:00

Written by Jennifer Openshaw
Posted by Minjune Kim

This holiday is all about finding the right present for the right price. Luckily, there are some new online tools to help you do just that. After all, if you're not careful, you may end up spending more time hunting for deals online than you would by simply heading to a discount warehouse and doing your shopping in one fell swoop.

And these tools are not just for young technology geeks. "An older woman sitting next to me was raving about new apps," says tech expert Omar Wasow, referring to applications that enable you to do a host of activities from your smart phone, including detecting a police car or conducting a stock trade.

"She was exhibiting the same behavior as nerdy boys. Apps have gotten so easy to use that you see a much broader swath of the population using them," he said.

But before I share these new apps--plus seven other useful online tools that don't require a smart phone--let me remind you of the most important holiday shopping tip: Make a list and check it twice, and set a budget or the holidays won't be so nice.

OK, now for some top tips from Santa and the elves:

1. Coupon clipping the e-way
Most of you know you can head to Apple's store for a host of iPhone apps. Now, there's an app that allows you to get coupons in your area. Say you're looking to buy Nintendo's Wii. With the free Yowza!! coupons app, you'll discover which stores have the best prices within, say, a 15-mile radius of your home. Once in the checkout line, the agent will scan a barcode on your cell phone, avoiding the dreaded coupon clipping.

"If I'm at the mall, I may use my Yowza!! feature and see if there's a better deal up to 15 miles around," Wasow says. "It might be 10% or 15% off at a nearby store, and that can make the difference."

The RedLaser app allows you to scan an item's barcode--say, a DVD player--and get instant access to prices online. You can also scan items and send them to yourself to view later on a larger screen.

2. Be a fan for savings
Retailers are now turning to social media tools like Facebook and Twitter to market special deals and, at the same time, test these new marketing tools. "You can search for your favorite retailer on Facebook and join their fan page," says Michelle Madhok, founder of SheFinds.com. "They'll release special deals, and hot items will then show up in your news feed when you log into Facebook."

3. Price alerts
Serious investors know they can set up alerts for stock price gains or drops. Now, you can do the same for electronics, clothes and other gifts on your list, receiving instant alerts in your inbox when an item's price drops. Shopstyle.com offers sale alerts for fashion items and Pricespider.com does the same for electronics.

4. Visit the online 'dollar store'
A big part of Overstock.com's business, Madhok says, is selling items not sold elsewhere, sort of like the online version of the dollar store. While the products can really range in quality, you can buy last year's items--say an iPod--at huge discounts of 50% or more. And many recent book titles can be had for $1, cheaper than Amazon.

5. Bank and save
Look to your bank for special offers. Bank of America Corp. (BAC) is among those with a shopping program designed to encourage customers to use their debit cards. With the "Add It Up" program, you can shop for products through any of the 300 listed retailers, buy at the discounted holiday price if available, and receive up to 20% cash back on your purchase.

Many banks, such as Wells Fargo & Co., also offer tools to manage your expenses in real-time, so check them out so you avoid that holiday debt hangover.

Click here to read more

Ways to Save Money This Winter

2009-12-06T15:19:00.000-08:00

Posted By: Pete Hill

Although the economy seems to be recovering from the recession, it is still important for people to save money. A big component of saving money is by spending smart. Especially this time of year, where people tend to lose track of budgets and overspend given the holiday season of “giving”, there are ways to still save money. The three big ways to save money are by smart Christmas spending, lowering home energy costs, and by investing those saving to see a return.

Christmas does not need to be a time to spend all of your money just because it was what you did in the past. Through cookies, recording family gatherings, creative Christmas cards, there are plenty of ways to give memorable gifts without spending more than fifteen dollars.

At home there are ways to cut your spending, without anyone ever noticing. Energy bills are on the rise, but are easy to counteract. If you turn your thermostat down two degrees, you will save four percent off your heating bill. Additionally, turning down the hot water heater just ten degrees will save you five percent or fifteen dollars. Repeating this process will allow for savings, and make sure money is not being wasted in your own home.

Lastly, if you invest the money that you are saving from holiday spending and energy bills, you will make money on the initial savings!

Sources:
http://www.bankrate.com/finance/personal-finance/12-ways-to-create-holiday-magic-for-less-than-15-3.aspx
http://www.bankrate.com/finance/money-guides/energy-savings-get-the-most-for-your-money-1.aspx
http://www.bankrate.com/finance/investing/9-cash-saving-tips-that-pay-big-bucks-1.aspx

Cyber Monday is a larger success than Black Friday

2009-12-06T14:37:00.000-08:00

Posted By: Pete Hill

The last week of November is an especially important one for the U.S. economy. Following the Thanksgiving holiday on Thursday is Black Friday, traditionally the best sales day of the year for retailers as Americans rush to do their Christmas gift shopping.

Monday brought a bit of holiday cheer for online retailers as shoppers spent less time but more money than last year.

Many predicted that Black Friday would be bigger than Cyber Monday, but the results were surprising. U.S. consumers spent ten percent more on Cyber Monday than on Black Friday. Monday's sales were up fourteen percent compared to last year and the number of items per order also climbed thirty percent.

Online shopping can be much more beneficial to a consumer by comparing prices, instead of going right into one store. If you can figure out a way to get good at the internet, consumers can have some fun at this. It will be helpful, more than ever before, in this economy to help our dollar go further.

Sources:
http://english.chosun.com/site/data/html_dir/2009/12/03/2009120300475.html
http://www.nytimes.com/2009/11/28/your-money/28money.html?_r=1&ref=your-money
http://www.latimes.com/business/la-fi-cybermonday2-2009dec02,0,7649378.story

How to Survive the Holidays Financially

2009-12-06T08:32:00.000-08:00

By: Laura Reginelli

The holidays are a time of family, joy and generally gift giving. Whether the gift is big or small, most people have become used to the tradition of exchanging gifts for the holidays. For many families, the holiday spending is enough to break the bank and as we go through these economically tough times many may be wondering how to get through the holidays without overspending. It’s a balancing act of give and take. Read below for tips.

· Take advantage of the digital age and start to shop online. Often times it is less hassle and much less expensive. Shopping online allows you to easily compare prices of goods from different stores, ultimately leading you to leave with a deal!

· Don’t fear signing up for rewards cards that you come across. Often times rewards clubs have exclusive offers for members around the holiday time and they can help you keep money in the bank. Remember every little bit helps.

· Another good idea is to create a spending limit for yourself and then budget out how much you want to spend for each individual. If you have a budget you are likely to spend less and seek out the deals that are available.

· Just like when you go grocery shopping you should also bring a shopping list for holiday shopping as well. This will help eliminate time and hassle.

Sources: http://www.ehow.com/how_2133778_save-shopping-holiday-season.html?ref=fuel&utm_source=yahoo&utm_medium=ssp&utm_campaign=yssp_art

http://family-budgeting.suite101.com/article.cfm/christmas_shopping_on_a_budget

http://familyfinances.suite101.com/article.cfm/how_to_avoid_christmas_shopping_stress

Low Cost, High Thought, Holiday Ideas

2009-12-05T15:03:00.000-08:00

Posted By Pete Hill

The time of the year starting with “Black Friday” and ending on Christmas Eve is a time in which spending increasing, and many budgets are not followed as planned. However, there are ways to spend efficiently, and give gifts that will be thoughtful and beneficial.

Many holiday shopping strategies focus on getting more for less. But in actuality it is just better to give and get less stuff for a lot less money. Two of the easiest ways to cut down the holiday spending is to not buy yourself presents during the holiday season, and do not buy items for your spouse. Homemade gifts that last forever and can capture more loving memories are always preferred and cost much less money.

Another big problem of the holiday shopping season is that many people buy gifts that have a higher price tag than the value it actually brings to the recipient. For example, you may buy a present for some for fifty dollars that they may not spend fifty dollars on, or even buy all together. As a result, there is one present that is always effective- cash.

With new fees and restrictions on gift cards, money becomes the much more useful and thoughtful gift. Money can be used everywhere, even internationally. In addition, you can buy anything at anytime, with no penalty for holding onto it too long.

As a result, during the holiday shopping time, cash are perfect presents although with thoughtful, homemade gifts.

Sources:
http://money.blogs.time.com/2009/11/19/cash-the-perfect-gift/
http://money.blogs.time.com/2009/11/20/have-yourself-a-merry-anti-consumer-christmas/
http://money.blogs.time.com/2009/12/04/135-money-saving-resources-and-tips-special-holiday-season-edition/

How to Improve Your Credit Score After Bankruptcy

2009-12-05T12:41:00.000-08:00

Posted by: Janielle Viggiano

Bankruptcy can be devastating to your credit score, but if you know how to bounce back it can be easy to get your credit score back up. If you want to build your credit back up fast you have to get and use credit. A bankruptcy can technically stay on your credit score for up to ten years, but according to MSN Money, “if you adopt responsible credit habits such as paying your bills on time, using only a small portion of your available credit and not applying for too much credit at once (2009).”

People interested in improving their credit scores can opt for a secured credit card and payroll deduction credit cards. “One can get approved for a secured credit card within 6 months of a bankruptcy discharge. The card is secured by a cash deposit that acts as a collateral for the same. Although, the fees required for secured credit cards are much higher than those levied on unsecured credit cards, the consumer may find it difficult to get approved for unsecured credit cards due to poor credit scores (2009).” The only pre-requisite for a payroll deduction credit card is that the applicant must be employed because the money that is used for the card is deducted from the person’s paycheck over a 2 month period.

According to Smart Money, here’s how to raise your credit score as quickly as possible after declaring bankruptcy:

Damage control
Get new credit cards
Piggy bank
Bigger loans

Sources: http://articles.moneycentral.msn.com/Banking/BankruptcyGuide/BounceBackFastAfterBankruptcy.aspx

http://www.smartmoney.com/personal-finance/debt/declaring-bankruptcy-can-improve-your-credit-score-20681/

http://www.buzzle.com/articles/improve-credit-score-after-bankruptcy.html

Disappointing "Black Friday" Reports

2009-12-05T12:29:00.000-08:00

By, Meredith Anderson

While some enjoyed their Thanksgiving breaks at home with family relaxing and catching up, others were watching the clock on Thanksgiving. Many people would agree that the holiday season officially kicks of with the Macy's Day Thanksgiving Parade. However millions other agree that the Friday after Thanksgiving, which has come to be known as "Black Friday," is the real deal. Hundreds of people wait outside stores with the sun hours from even rising to try to grab the best deals.

It's been said that "Black Friday" is not only a great time of profit for companies, but also a very helpful predictor for how the rest of the season will play out. With all the hard months in the past this year was suppose to be a good day for everyone. In fact sales increased .5% from last year.However with this excitement can some disappointment when more analysis showed that the increase in shoppers was making this data seem more favorable then it actually was. Almost 2 million more people showed up at stores on Black Friday, making the sales for this year an actual loss of 8.6%.

The newest introduction to the retail tradition now known as "Cyber Monday," was actually retailers best hope this year. The sales that continued online till Monday showed a drastic improvement of 19.6% from last year. Internet is still only a small portion of the industries sales, however it is showing the strongest future for this season.

Sources:

http://www.examiner.com/x-2988-San-Diego-Economy-Examiner~y2009m12d2-More-reports-that-Black-Friday-spending-was-down-due-to-recession
http://www.examiner.com/examiner/x-2988-San-Diego-Economy-Examiner~y2009m11d30-Black-Friday-sales-numbers-worry-retailers--Is-this-another-bad-year-for-retail
http://news.yahoo.com/s/ap/us_holiday_shopping

When NOT TO Cancel a Credit Card

2009-12-05T00:31:00.000-08:00

Article by Matthew Maillet

Making the decision to cancel a credit card has many associated risks that come along with it. For example, closing an account may hurt your credit score for up to two years. These repercussions can have lasting effects on your ability to access a loan, acquire financing, etc. With that said, there are many considerations to take into account before choosing to close an account.

If you are on the market for a substantial home or auto loan, it is most important for your credit score to be as strong as possible—every little detail counts when a lender is determining payments and length of the loan. Thus, refrain from closing an account until you have already been approved for the loan.

If you are struggling to boost a low credit score, you should avoid cancelling credit cards at all costs. “You particularly want to preserve your oldest and highest-limit accounts when you're in credit-improvement mode.” With that said, it is typically unwise to cancel a credit card with any credit score lower than 700. If closing your account is a desperate measure that is unavoidable, delay cancelling the account as long as possible. Wait until you are in the most stable position possible before you make the decision to cancel your account.

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Yet Again, Congress has Ignored the Best Interest of the Consumer

2009-12-05T00:26:00.000-08:00

Article by Matthew Maillet

Banks have been given a two month grace period before new laws are formally enacted. The Congress opposed a bill presented by the House that would have made new banking restrictions enforceable on December 1^st, 2009 as opposed to February 22^nd, 2010. Thus, banks are reacting aggressively by taking advantage of the last few months before new laws come in to affect. While the banks’ dissatisfaction is mostly caused by lawmakers, many companies have attacked their own customers—while ignoring consumers’ credit scores and payment histories in the process.

By banks unjustly attacking consumers with 20%-30% rate increases in recent months, many companies have risked losing their core base of customers. Any consumer with decent credit has the opportunity to switch banks if he or she pleases, thus there is great risk in these tactics. Those Americans with poor credit history however are faced with the threat of default. This domino-effect has all come in response to government measures that were originally put in place to PROTECT the consumer, not BANKRUPT the consumer.

The blame should be directed towards Congress. The vast majority of banks facing the new 2010 laws in the near future are in fact prepared to meet these new regulations today. However, Congress has ignored the best interest of the American consumer while siding with the banks.

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Ways to make money in the market

2009-12-04T23:07:00.000-08:00

posted by Pete Hill

With the market increasing to back up over sixty percent of where it was prior to the recession, investors are still able to make returns if done properly. The first step to investing well is to take your emotions out of the equation. In theory, you should put money into the market when no one else wants to. But that's easier said than done because people still remember what happened last time.

“Wall Street likes to think of the stock market as an emotionless discounting mechanism of future corporate earnings, but in reality, it's a creature of turbulent emotion, especially in the short term.” stocks are your best bet for gains over long periods of time. If you have a long-term goal, such as retirement, you need to tiptoe back into the stock market, if only to get returns a little above nothing.

The best bet is stocks, bonds, and money market funds. The best mix to have in this current economic condition is twenty percent in money market, thirty percent in bonds, and fifty percent in stocks.

Although the market is still hated among many investors, it is bouncing back and there is potential to make money if done cautiously.

Sources:

http://www.usatoday.com/money/perfi/columnist/waggon/2009-11-13-invest13_ST_N.htm

http://www.usatoday.com/money/perfi/columnist/waggon/2009-11-20-invest20_ST_N.htm

http://www.usatoday.com/money/books/reviews/2009-11-15-the-sellout-book_N.htm

Loan scammers hide behind 405 area code

2009-12-04T20:22:00.000-08:00

South Carolina woman bilked out of $2,400 by Canadian con artists

Written BY VALLERY BROWN
Posted by Stefanie Marty

Bad credit? No credit?

Offers abound to help individuals get loans or credit cards, even with less-than-perfect credit history. A South Carolina woman learned the hard way that some deals are too good to be true.

Tyna Milcetich, of Charleston, S.C., had an opportunity in August to move out of her rental home and into a houseboat. She started looking for a loan to buy the $30,000 boat and found Birchmount Financial Services of Oklahoma City through a Google search.

Milcetich said the Web site and the loan application offering personal loans to consumers with poor credit looked like the real thing.

She filled out online forms requesting information about a loan.

The next day, she received a phone call.

"They contacted me back and sent me contracts,” Milcetich said. "Then they told me I’d been approved.”

A poor credit history made Milcetich ineligible for most bank loans. She said her common sense was overcome by the surprise and joy of being approved.

Milcetich filled out contracts, gathered documents and faxed everything back to the company at their 405 area code.

A representative instructed Milcetich she would need to pay $2,400 in collateral before the loan could be disbursed.

Thinking it the opportunity of a lifetime, Milcetich emptied her savings account and wired the money.

Click here to read more.

Credit Card Hardship Programs

2009-12-04T13:44:00.000-08:00

By Stefanie Marty

In difficult economic times many people have trouble meeting their financial obligations and get behind in credit card payments. These missed payments damage credit scores and cause additional charges. To help borrowers maintain their debt and avoid defaulting many financial institutions offer credit card hardship programs.

A credit card hardship program is an agreement between a borrower and a credit card company under which a payment plan is set up. Payments are delayed and interest rates and monthly payments are reduced to a level the borrower can afford. By offering these programs the lender hopes that the borrower will be able to make full payments on the account in the future. Also, credit card hardship programs are not offered to everyone. Typically, they are limited for financial hardship caused by life-changing events.

Credit card hardship programs also have their potential downsides. It is only a myth, and not reality, that with such a program you will be able to reduce your credit card balance in half. Further credit card hardship programs will hurt your credit score and also affect your credit card account.

So make sure you know enough about a credit card hardship program before applying for it. It might be a good solution for some borrowers, but not for others.

Source 1
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Source 3

Fewer Shoppers Using Credit This Holiday Season

2009-12-04T12:13:00.000-08:00

Posted by: Janielle Viggiano

An estimated 28.6% of people will be using credit to pay for holiday gifts this year, down from the 31.5% that paid with credit last year. According to the Wall Street Journal, credit is still more actively used than debit for online shopping, mainly because the protections are better when using credit in case of fraudulent overdrafts.

If you’re one of the 28.6% of people using credit this year, beware of the consequences. Dallas News states, “Running up your credit card bills could be extra costly this year as card issuers scramble to change many terms before federal rules restricting their practices take effect in February. They're raising annual percentage rates, instituting fees, slashing credit limits and even closing some accounts, all of which could put consumers who carry large balances in a bind (2009).” If you are planning on using your card, make sure not to charge anything that you don’t think you can pay off in three months.

According to Michigan Business, “The number of credit cards outstanding has declined to 325 million -- down from the peak a few years ago of 425 million, according to Diane Swonk, chief economist for Mesirow Financial in Chicago (2009).”

When you’re shopping this holiday, develop a spending plan before you head to the stores and a list of people you are planning on buying for, how much you want to spend on them, and what you plan on getting them. This will make it easier to stay away from making impulse purchases. Pay in cash or use debit, but if you decide to use debit make sure you keep track of your spending and your bank balance so that you don’t overdraw your account.

Sources:http://online.wsj.com/article/SB10001424052748704107104574570110802685606.html?mod=WSJ_hpp_sections_personalfinance

http://www.dallasnews.com/sharedcontent/dws/bus/personalfinance/stories/112309dnbusperfi.3c94af6.html

http://www.freep.com/article/20091203/BUSINESS06/912030582/1318/Beware-of-a-credit-card-Christmas

Understanding Your Credit Score

2009-12-04T11:51:00.000-08:00

Posted by: Janielle Viggiano

Credit scores or FICO scores are numbers that are assigned to you that represent your credit history. According to the Associated Press, “The information that is used in determining your FICO score comes from a variety of places including the major credit bureaus, credit card companies that have issued you a credit card, banks and other financial institutions where you have loans, and other data bases that have consumer data on them (2009).” The numbers are added up and determine whether you are eligible for low cost credit, higher risk credit, or no credit at all. The higher your score the better your credit rating, which translates into lower interest rates on loans or other credit items.

According to Lending Tree if you have a credit score of 720 or above, you have excellent credit and will most likely receive a lender’s most favorable rates. “Lenders will often allow you to borrow more than 80 percent of the value of your home, and may not require private mortgage insurance. You will likely be able to get a home equity loan or line of credit with an interest rate equal to the prime rate, or even below it. You can also look for a credit card that will reward you with a low interest rate -- while many cards charge 18 percent, you should be able to obtain a rate under 10 percent (2007).” 675 to 719, you’re not going to get the best rates but should still have no difficulty finding a good loan. “On a 30-year fixed-rate mortgage, expect to pay up to half a percentage point more than someone in the top category (2007).” 620 to 674, “With a below-average credit score, your options will be reduced, and you’ll pay a premium on your loan -- perhaps as much as 2 percent more than borrowers with excellent credit. You may need to provide more documentation than those with higher scores, including a formal appraisal of your home’s value (2007).” Lastly, below 620 puts you in a category of a “sub-prime” borrower. You’ll most likely pay at least 3 more percentage points than someone with excellent credit and will be in the double digits for a home equity loan. A poor credit score can hurt your rate for car insurance and even put a damper on a job search.

One can improve their credit scores by paying their balance on their credit cards on time, at the end of each billing cycle, and not just paying the minimum amounts. According to Buzzle.com, “Existing lines of credit should not be canceled since doing so will increase the debt utilization ratio. The ratio between the outstanding balance and the amount of available credit is known as the debt utilization ratio. Again, increased credit limit will result in lowering the debt utilization ratio. A low debt utilization ratio is good for the credit score while a high ratio impacts the score negatively (2009).”

Sources: http://www.associatedcontent.com/article/74007/credit_scores_understanding_what_they.html

http://www.lendingtree.com/credit-resources/advice/credit-scores/what-do-credit-scores-mean/

http://www.buzzle.com/articles/credit-scores-and-what-they-mean.html

Holiday Credit Card Tips

2009-12-04T10:00:00.000-08:00

Posted by: Christina Dove

In the midst of the holiday season, there are several credit tips that must be followed to avoid added financial stress. With so many purchases during this time it is important to keep track of how much you are spending on each credit card. One of the most important tips are not to fall into the trap of buying an in-store credit card. Many retailers offer these cards and try to entice you by offering some inital discount of 10-15% off of your first purchase with the card. However, this superficial offer can get you into some trouble in the future.

"In-store credit cards are structured like subprime credit cards. Even if you start with a low rate, these rates generally go into the low 20s," said John Ulzheimer, president of consumer education at Credit.com. "Terms retailers offer, a 24.9% interest rate and a credit limit of $1,000, are terms reserved for high-risk borrowers," he adds. Another trap many holiday credit card users fall into is not knowing how much they are spending or at what rate they are borrowing. Both of these habits can be very dangerous and cause a lot of added stress after the holiday season. Make sure to use the credit card that has the lowest rate as well as remember to only spend as much as you plan on being able to pay back.

Credit card companies can be relentless during this time of year and are looking to take your money, no matter what cost it is to you. So it is very important to be aware of how much you are spending on your credit cards and to be smart this holiday season.

Sources:

http://money.cnn.com/2009/11/18/pf/holiday_credit_card_tips/index.htm

http://www.federalreserve.gov/newsevents/press/other/20091125b.htm

http://news.morningstar.com/articlenet/article.aspx?id=316546&pgid=rss

People Looking to give more charitable gifts in bad economy

2009-12-04T09:46:00.000-08:00

Posted by: Christina Dove

In this bad economy people are struggling to figure out how to afford the Christmas gift giving season. With so many bills and loans to pay people do not have the extra expenible income that they have had in the past to spend on Christmas gifts. Even if you have not lost your job or been severely impacted in other ways are finding it difficult to decide how to effectively spend their money this holiday season.

One option a lot of Americans are taking advantage of is donating gifts to charities on behalf of people they are giving gifts to. This is a great way to help out the charities in need as well as save money on expensive, nonmeaningful gifts. As a result of the current economic climate, seven in 10 adults (71 percent) will spend less money on holiday presents this year, and about half (49 percent) are now more likely to give a charitable gift as a holiday present. Also, more than four in five adults (84 percent) would prefer to receive a meaningful gift that would help someone else rather than a traditional holiday gift such as clothing or electronics. These statistics show that now more than ever is the time to truely be giving this holiday season and donate gifts to those who need them most.

Not only is this a great opportunity to save money, it is shown that people would rather receive a meaningful gift rather than a standard thoughtless store bought gift. So this holiday season start being creative in your gift giving and save some money in the process.

Sources:

http://money.cnn.com/2009/11/30/pf/charitable_giving.moneymag/index.htm

http://www.cnbc.com/id/34257037

http://www.worldvision.org/content.nsf/about/20081117-charity-giving-survey

Cyber Monday Posts Strong Sales

2009-12-03T14:03:00.000-08:00

By Eric Gursky

Cyber Monday, the marketing term used to describer the monday following Black Friday took place this past week. Many online retailers count on Cyber Monday to be one of their biggest sales days just as malls count of Black Friday to deliver good results. In 2008 when our economy was in a recession many retailers were blindsided with the weak turnouts and low sales. This year was hoping to be much different.
By late Monday afternoon sales were already up 11 % from a year ago. Web retailers had stepped up promotions and discounts in order to capitalize on the shoppers not finding all their wish list items in stores. According to Coremetrics, a San Mateo, Calif.-based company which likes to compare Cyber Monday sales to online Black Friday sales, to see how "cyber" the Monday actually is. As of about 5 p.m. Pacific time, Cyber Monday was about 13 percent ahead of Black Friday.
Based on results from 500 participating vendors, including Macy's, Nordstrom and Bloomingdale's, Coremetrics said the average online order grew to $180.03 on Cyber Monday, up 38 percent from $130.24 on the same day last year.
NBC posted similar results on Cyber Monday, ShopNBC.com achieved its highest traffic day year-to-date, with 114,600 unique visitors to the site. In addition to surpassing 2008's Cyber Monday traffic by 14%, web penetration accounted for an industry leading 48% of the total company sales. The increase in traffic to the site, along with its extended product assortment and promotional offerings, led to an 18% increase in sales vs. last year's same period. Total orders on ShopNBC.com increased 40% over the previous year.

Source 1
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G.E Agrees to Sell NBC to Comcast

2009-12-03T13:45:00.000-08:00

By Eric Gursky

After many months of negotiations and publicity, the sale is finally complete. Comcast, the nations largest cable operator has reached and agreement to acquire NBC Universal from General Electric. This acquisition will allow Comcast to have a 51% majority ownership in NBC while G.E will attain a 49% ownership.
The deal is estimated to be valued at $30 billion. Under terms of the deal, Comcast will contribute its entertainment channels, including E and Versus; nine regional sports networks; and about $6.5 billion in cash in exchange for 51% of the new venture, which will continue to be called NBC Universal for the immediate future. G.E owned a 80% stake in NBC before the deal.
Chief Executive Officer of G.E Jeffery Immelt sees this NBC sale as an opening of new opportunities for G.E including but not limited to acquiring businesses in aviation and health care. After dividends and capital spending, GE will have $16 billion to $18 billion in discretionary cash next year. Immelt doesn’t expect to have to add capital to the GE Capital finance unit beyond the $2 billion in 2011 that may be required by an agreement between the division and the parent company.
For Comcast this is a win-win situation as it allows them to grow bigger and expand their markets while other media giants are shrinking. This deal is a perfect fit for Comcast and will allow them to become a leader in the development and distribution of multiplatform 'anytime, anywhere' media that American consumers are demanding.

Source 1
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Source 3

The 5 C's of Credit

2009-12-03T09:36:00.000-08:00

By Shawn Chandok

Regardless of your financial stability, there is a high possibility that you will require a loan at some point in your life. Whether this is a bank loan, student loan, or any other type of loan, the qualifications for your eligibility will most likely be the same. Below, I will be discussing the 5 C’s of credit and how each one differs significantly.
1. Capacity is by far the most important of all the factors determines your eligibility for the loan because if specifies how you intend to pay the loan back. Lenders will usually project your expected cash flows and determine an interest rate suitable for you. Furthermore, they will look at your credit history to make sure you confirm you are a worthy investment for them and do not contain any risk, such as multiple previous bankruptcies.
2. Capital refers to the amount of your personal money you have invested for the project. The purpose of capital is to reduce the risk for the lender. If the lender feels you have a lot of your own money invested as well, his/her risk decreases because if the investment sinks, you sink as well. Thus he/she will be more willing to lend you money if you share the risk.
3. Collateral refers to the form of security you provide to the lender in case you cannot repay him/her. Most people will usually put their home/mortgage as collateral for the lender. If you cannot repay the lender, he/she will usually put a lien on your home until foreclosure is inevitable. What you should know is that, banks do not like foreclosures because they have to auction the home for a less value, which means they lose money.
4. Conditions merely reflect the circumstances for the loan. For example, are you taking the loan out for a family emergency or collage? Each condition creates a level of importance and lets the lender aware of your situation.
5. Character refers to the type of person you are. Lenders want someone who they know will pay them back on time. They usually check your educational background and confirm with your attitude. Although this may seem unimportant, this can sometimes be one of the most important criteria’s for a lender.

Source#1
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Source#3

Cyber Monday Outperforms Black Friday

2009-12-03T06:10:00.000-08:00

Posted by Ahmed Al-Salem

The last week of November is an especially important one for the U.S. economy. Following the Thanksgiving holiday on Thursday is Black Friday, traditionally the best sales day of the year for retailers as Americans rush to do their Christmas gift shopping. The name was coined because businesses count on the day's sales to bring their balance sheets into the black.

With the rise of the Internet, the term "Cyber Monday" was coined in 2005, referring to the Monday after the Thanksgiving weekend when online shopping surges. The two days are of great significance as they serve as a bellwether for the U.S. economy, indicating the level of consumer confidence and illuminating consumption trends.

Experts paid particularly close attention this year because a rise in consumption could signal a recovery of the U.S. economy, and the world economy in turn, from the financial crisis, which started last September. Many predicted that Black Friday would be bigger than Cyber Monday as usual, but the results were surprising.

According to market researcher Coremetrics, U.S. consumers spent 10 percent more on Cyber Monday than on Black Friday. Monday's sales were up 14 percent compared to last year and the number of items per order also climbed 30 percent.

In contrast, the average U.S. consumer bought US$343.31 worth of goods on Black Friday, down 7.9 percent from last year, the National Retail Federation said.

Experts say that recession-weary consumers used offline retailers for window shopping before turning to the Internet to make actual purchases at better prices.

Source 1
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Black Friday fails to boost stores

2009-12-03T06:04:00.000-08:00

Parija B. Kavilanz

Posted By Ahmed Al-Salem

Retailers placed a lot of hope on the Thanksgiving weekend gift buying this year, but early sales results for the month released Thursday showed many merchants did not get the big boost they were seeking.

Some specialty sellers were hit especially hard. Among them same-store sales at teen clothing chain Hot Topic fell 11.7%. last month. Analysts had expected a decline of 8.1%, according to sales tracker Thomson Reuters.

Children's Place, a seller of clothing and accessories for young kids, suffered a 13% drop in its same-store sales versus expectations for a 1% increase.

Sales at another youth merchandise chain Abercrombie & Fitch (ANF) slumped 17%

Elsewhere, total sales at No. 1 warehouse club operator Costco (COST, Fortune 500) rose 6% compared to a forecast for an increase of 8.1%

Same-store sales are a key measure of a retailer's performance and measure sales at stores open at least a year.

Thomson Reuters, which tracks monthly same-store sales for 30 chains such as Target (TGT, Fortune 500), Gap and J.C. Penney (JCP, Fortune 500), said 15 of the retailers in its Same Store Sales Index have reported their results. Of those 15, 85% missed analysts' sales estimates while 15% beat expectations.

Overall, the firm has expected November sales for the group to grow 2.1% compared to a steep 7.8% decline last year.

However, the much softer-than-expected early numbers prompted Thomson Reuters retail analyst Jharonne Martis to say that November's performance will most likely be worse than expected

November is a critical month for retailers since it marks the start of the year-end holiday shopping season. November and December together can account for 50% or more of merchants' annual sales and profits for the full year. To top of page

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Early Holiday Shopping Numbers Cause Confusion

2009-12-02T18:25:00.000-08:00

Posted by: Christina Dove

After Thanksgiving is when most people decide to start chipping away at their holiday shopping list. With the struggling economy many economists believed that people would be cutting back on spending this holiday season and spending more money at less expensive stores, such as Walmart. On the one hand, the International Council of Shopping Centers projected holiday sales would rise 1 percent to 2percent, and its survey suggested consumers will boost spending on gifts this year but will cut down on gift cards. However, we are determining that this is not the case.

The data complied so far this holiday season is conflicting and inconclusive about America's holiday spending tendencies this holiday season. We expect the sales to be about the same as last year, since we are still in the midst of an economic crisis. Black Friday lived up to its expectations and was one of the biggest shopping days of the year. Lines were long and businesses experienced a spike in sales that helped to make up for the lagging retail market.

Based on the numbers complied after Black Friday, The National Retail Federation estimated that the amount of money spent per shopper was $343.31, a decrease of 8 percent from last year’s $372.57. The NRF said this season’s shoppers stuck to their lists and bought only small-ticket items. This is to be expected as people have much less expendible income to spend on expensive and extravagant gifts. To conclude, we will have to wait until after the holiday season to truely appreciate how deveasting the economic crisis is on holiday shopping and consumer spending.

Sources:

http://www.slate.com/id/2237251/

http://www.google.com/hostednews/ap/article/ALeqM5gUKZVwCpm9cuY6cXgb2PVAKp0gSwD9CBF1C00
http://www.cw.ua.edu/post-thanksgiving-sales-draw-many-shoppers-1.2109084

Tapping The New Home-Buyer Tax Credit

2009-12-02T18:19:00.000-08:00

Posted by: Christina Dove

House shopping usually slows down in the winter, as people put their home searches on hold to trim the tree, buy presents to put under it and avoid the chilly weather.

This winter, however, might be different, thanks to the extended--and expanded--first-time home-buyer tax credit.

"We're going to see far more interest in the fourth quarter than we generally do because of the tax credit," said Heather Fernandez, vice president of Trulia.com, a real estate search engine. Traffic surged on the site on Nov. 5, the day Congress approved the credit extension, she said.

The new law extends the tax credit for first-time home buyers and opens it up to some existing homeowners as well: The credit is now 10% of the home price, up to $8,000 for first-time buyers and up to $6,500 for repeat buyers.

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Shoppers Showed Up, but Spent on Bargains

2009-12-01T11:37:00.000-08:00

By Lingxiao Li

More consumers flooded the nation’s stores on Thanksgiving weekend in search of bargains. Statistics have shown that some 195 million consumers visited stores and Web sites over the weekend, up from 172 million last year, according to the National Retail Federation, the trade group that reported sales results on Sunday afternoon. Average spending over the weekend, however, fell to $343.31 a person, from $372.57 a year ago. Total spending was $41.2 billion — about the same as last year.While retailers are encouraged by the number of Americans who shopped over Black Friday weekend, they know they have their work cut out for them to keep people coming back through Christmas,” Tracy Mullin, president and chief executive of the federation, said in a statement. “Shoppers can continue to expect retailers to focus on low prices and bargains through the end of December.The good news for retailers was that consumers opened their wallets for some discretionary items, albeit cheap ones. Shoppers not only bought gifts, but also took advantage of low prices to replace old household sundries, like irons, toasters and sheets. The NPD Group found that pent-up demand led some 63.8 percent of consumers to shop for themselves over the weekend.
Although the Friday after Thanksgiving is typically a busy day, a big turnout does not necessarily translate into significant profits or indicate how consumers will shop for the rest of the year. Last year, retailers posted the worst sales figures in decades. This year, sales are expected to be about the same as last Christmas.

http://www.nytimes.com/2009/11/30/business/30retail.html?_r=1&ref=your-money
http://www.nrf.com/modules.php?name=News&op=viewlive&sp_id=842
http://www.shop.org/c/journal_articles/view_article_content?groupId=1&articleId=1047&version=1.0

Save on Gift Giving

2009-12-01T11:31:00.001-08:00

By Lingxiao Li

Holiday seasons are coming. Most of us are preparing gifts for family and friends.
If you’re planning to spend less on holiday gifts this season, instead of buying smaller and cheaper gifts for everyone on your list, consider setting up a high-tech Secret Santa program with your family or at your workplace.
With Secret Santa swaps, each member of the participating group is assigned another member to give a gift to anonymously, allowing participants to save because they only have to buy a gift for one person in the group. And setting up a swap no longer has to involve pulling names out of a hat. A slew of online sites and services can help you organize the swap and do the assigning for you.
Such sites say they have noticed more interest in the exchanges since the recession began. At one site, Elfster, users can create free group gift exchanges, specifying the spending limits and the e-mails of participating members. The site will then do the name drawing and let each participant know who they are buying a gift for. Users of the site can also send anonymous notes to others in their group (think “what does mom really want”) and create gift wish lists.
The number of gift exchanges started on Elfster in the week ending yesterday is up 58percent from the same period last year, which is more than double last year’s growth rate. There is more interest than ever in Secret Santa programs from consumers and also retailers, who are recognizing that consumers are looking for a more cost-effective holiday experience(NY Times).

http://bucks.blogs.nytimes.com/2009/12/01/secret-santa-sites-offer-another-way-to-save-on-gift-giving/?ref=your-money
http://bucks.blogs.nytimes.com/

GE New 5 Year Consumer Credit Card Extension

2009-12-01T11:31:00.000-08:00

By Eric Gursky

STAMFORD, Conn. & GRAND RAPIDS, Mich.--(BUSINESS WIRE)--GE Capital Retail Consumer Finance, a consumer lending unit of General Electric Company (NYSE: GE) today announced a 5-year extension of its credit card program with family-owned, Midwest retailer Meijer, providing credit services and valuable programs to shoppers. The program started in 2003 with the launch of their first-ever private label credit card program for Meijer.

Since launching the private label credit card with GE, the relationship has expanded to include a general purpose Meijer MasterCard, and a prepaid card program both accepted at establishments outside of Meijer’s.

With 190 super-center locations and 174 gas stations in 5 states, Meijer credit cardholders enjoy a wide range of valuable benefits. The credit card program features a first purchase discount, monthly sale events, and 5 cent/gallon gas discount. The Meijer MasterCard also provides cardholders rewards on purchases made at Meijer as well as at other retailers.

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Shoppers Showed Up, but Spent on Bargains

2009-12-01T10:38:00.000-08:00

Post by Shawn Chandok

Article by STEPHANIE ROSENBLOOM

More consumers flooded the nation’s stores on Thanksgiving weekend in search of bargains. But with retailers dangling rock-bottom prices and consumers only biting at less expensive merchandise like small appliances and winter clothes, the average amount spent by each shopper declined from last year.
Some 195 million consumers visited stores and Web sites over the weekend, up from 172 million last year, according to the National Retail Federation, the trade group that reported sales results on Sunday afternoon. Average spending over the weekend, however, fell to $343.31 a person, from $372.57 a year ago. Total spending was $41.2 billion — about the same as last year.

“While retailers are encouraged by the number of Americans who shopped over Black Friday weekend, they know they have their work cut out for them to keep people coming back through Christmas,” Tracy Mullin, president and chief executive of the federation, said in a statement. “Shoppers can continue to expect retailers to focus on low prices and bargains through the end of December.”

One report, from ShopperTrak, a consulting and research firm, showed spending on Friday alone ticked up 0.5 percent compared with last year, to $10.66 billion. A more complete picture of the first half of the Christmas season will not emerge until Thursday, when the nation’s chains report their November sales.

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Shop with no hassles on Cyber Monday: Online spending expected to exceed $486 million this season

2009-12-01T10:23:00.000-08:00

Posted by: Andrew Pia

Written by: K.O. Jackson

Nov. 29--Concerns about the H1N1 virus and being around infected individuals may have kept some shoppers home on Black Friday.

But for anyone who missed out, there's always safe, at-home shopping on Cyber Monday.

Always the Monday after Black Friday, Cyber Monday is considered the unofficial start of the Christmas online shopping season.

Theresa D. Williams, director of the Center for Education and Research in Retailing at Indiana University's Kelly School of Business, said in-store crowds may be smaller this holiday shopping season in part because of an early flu season and the H1N1 virus.

Plus, people who have been sick and lost time at work, which can affect take-home pay, could have less money to spend, whether it be in stores or online.

"It's certainly going to have an impact on discretionary spending if you are paid hourly," said Williams, adding her center projects November-December retail sales to total $437 billion.

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Cyber Monday?

2009-12-01T08:28:00.001-08:00

Post by David Held

It’s the holiday season and of course everyone is spending. Everyone has heard of Black Friday, but as technology advances much of the buying has been moved to the internet. Yes, people still go to their favorite stores on black Friday, but year after year the spending seems to have been decreasing on this date; this is because of Cyber Monday. Cyber Monday is the Monday after Thanksgiving Weekend, a day where many consumers go back to work after a well deserved long week. Studies have shown that on this day Internet sales have skyrocketed. As a result of this many stores that have a big online presence have been offering more discounts and bargains on Cyber Monday. Online stores such as Overstock.com, Amazon.com, and many others have created coupons for Cyber Monday only.

One of the reasons why consumers have began shopping on Monday instead of Friday is because now they do not have to wait in the cold at 4am in front of their store of choice to get a bargain. Also, during the Wednesday, Thursday, Friday, and Saturday of Thanksgiving weekend people tend to spend a lot on food, travel expenses, and other expenses, so the consumer feels like he/she needs to go back to work to make some more money before spending on gifts.

As time goes by I can definitely see Cyber Monday becoming a more popular than Black Friday solely because of its convenience.

Sources #1, #2, #3

Shoppers Showed Up, but Spent on Bargains

2009-12-01T08:07:00.000-08:00

Post by David Held
By STEPHANIE ROSENBLOOM

More consumers flooded the nation’s stores on Thanksgiving weekend in search of bargains. But with retailers dangling rock-bottom prices and consumers only biting at less expensive merchandise like small appliances and winter clothes, the average amount spent by each shopper declined from last year.

Some 195 million consumers visited stores and Web sites over the weekend, up from 172 million last year, according to the National Retail Federation, the trade group that reported sales results on Sunday afternoon. Average spending over the weekend, however, fell to $343.31 a person, from $372.57 a year ago. Total spending was $41.2 billion — about the same as last year.

“While retailers are encouraged by the number of Americans who shopped over Black Friday weekend, they know they have their work cut out for them to keep people coming back through Christmas,” Tracy Mullin, president and chief executive of the federation, said in a statement. “Shoppers can continue to expect retailers to focus on low prices and bargains through the end of December.”

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"Black Friday"

2009-11-30T21:13:00.000-08:00

Posted By Pete Hill

Following Thanksgiving, one of the biggest shopping days of the year occurs. This date is called “Black Friday.” Many people head out in the middle of the night to find the best deals at best selection at stores. Coming with that are articles describing the best ways to get the most for your money, and at times avoiding the traffic.

According to retail-pricing expert and partner at marketing consultants, this year more retailers are trying to sell products using an actual dollar price point, versus a certain percentage discount. This would show a much larger decrease for a higher priced item than a cheaper item. Also, using facebook and twitter can give you updates on sales on Black Friday, as long as an iPhone application that will scan the barcode and tell you if it can be sold for cheaper anywhere else.

Another way to find deals and avoid the traffic and lines, is to shop online. The day after Thanksgiving the malls were packed, but there was no reason you had to go there to get the benefit of the deals. Plenty of sites offer coupon codes for online and brick-and-mortar retailers.
However, despite all of the frenzy and craze associated with “Black Friday”, many people showed up but did not open their wallets as much as last year. Spending went down and as a result, many stores will probably have to add additional discounts to ensure their Christmas inventory gets sold.

Sources:
http://money.cnn.com/2009/11/25/pf/saving/hot_black_friday_deals/index.htm
http://money.cnn.com/2009/11/24/pf/saving/shop_online/index.htm
http://www.time.com/time/business/article/0,8599,1943398,00.html

How to Save Money While Shopping Online

2009-11-30T18:48:00.000-08:00

Posted by: Pete Hill

The online holiday shopping season officially begins Monday. So in this week’s Your Money column, I explored different ways to get cash back on your online purchases, earn extra credit-card rewards, or land other discounts.
The savings strategies I examined all had one thing in common: using an indirect route to get to a retailer’s Web site. That might include a site like FatWallet, Upromise, or your credit-card issuer’s shopping portal. By accessing the retailers through these sites, you can earn extra savings.
I surveyed about 10 of these programs, which I outline in the column. Which did we miss? What are some of your favorite ways to save money when shopping online? Please share your tips in the comment section below.

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HSBC Makes a Profit in its Third Quarter

2009-11-29T18:54:00.000-08:00

By Rico K Setyo

HSBC, the London based bank had a very surprising third quarter. Their third quarter pretax profit was significantly ahead of the bank’s expectation and of a year earlier. This improvement came from a few factors, one being lower loan provisions and the stability of its corporate and investment banking division. Another factor that helped HSBC with beating expectations was the profitability of their credit card division in the US.

HSBC North America Chief Executive Brendan McDonagh mentioned that the improvements are early signs of a recovering consumer confidence. However, he stresses the idea that the recovery in consumer spending was at "very early, early stages," adding that the means for a stronger recovery in consumer spending would be a drop in unemployment, which could take place in the future, possibly 2010.

The bank is said to be the favorite choice of many analysts because of its heavy exposure to Asia and other emerging markets, and because it never had to turn to the government for bailout money. Since there is evident stability, there is no question that the bank will not be able to continue this trend in the future.

Source
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Agents without principals

2009-11-29T17:52:00.000-08:00

Posted by Rico K Setyo
By Harrison Hong

What a year! Lehman Brothers collapsed on Sept. 15th, 2008. The Dow Jones Industrial Average dropped by 43 percent. And since March 2009, the market has rallied and made up a significant fraction of its losses. The basic storyline for the financial crisis and recovery is familiar. The housing bubble deflated. Banks were caught holding over-valued exotic mortgage instruments bought using short-term debt. The Federal Reserve Bank and the Treasury bailed out finance firms both directly through giveaways and indirectly through the purchase of an array of assets. It’s anybody’s guess whether this crisis will return when the government withdraws its support.

What is clear is that this crisis reveals deep flaws in the financial system. In light of the millions of Americans out of work and the costly bailouts, many understandably believe one of these flaws to be bankers without principles who took excessive risks and endangered the economy. Reforms proposed by the Obama administration reflect this perspective. These proposals include a new consumer finance protection administration, attempts to link pay to longer-term stock performance and capital regulation to limit access to extreme leverage.

Some version of these proposals will likely be implemented, but its ability to prevent another crisis is far from clear. First, many of the subprime loans that are thought to be predatory and would presumably be forbidden by the new consumer finance administration actually gave many families free housing for some time. Second, these free homes ultimately came at the expense of sophisticated bankers (at least those who were not bailed out) who owned lots of shares of their company’s stock. And third, there have already been several attempts at improved capital regulation, known as the Basel Agreements.

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Black Friday Boasts $595 Million in U.S. Online Holiday Spending, Up 11 Percent Versus Year Ago

2009-11-29T17:20:00.000-08:00

Posted by Stefanie Marty

RESTON, Va., Nov. 29 /PRNewswire-FirstCall/ -- comScore (Nasdaq: SCOR), a leader in measuring the digital world, today reported holiday season retail e-commerce spending for the first 27 days of the November - December 2009 holiday season. For the holiday season-to-date, $10.57 billion has been spent online, marking a 3-percent increase versus the corresponding days last year. Black Friday (November 27) saw $595 million in online sales, making it the second heaviest online spending day to date in 2009 and representing an 11-percent increase versus Black Friday 2008.

"Black Friday, better known as a shopping bonanza in brick-and-mortar retail stores, is increasingly becoming one of the landmark days in the online holiday shopping world," said comScore chairman, Gian Fulgoni. "The $595 million in online spending this Black Friday represents the second heaviest online spending day of the season-to-date and a double-digit increase from last year. While this acceleration in spending suggests the online holiday season may be shaping up slightly more optimistically than anticipated, it may also reflect the heavy discounting and creative promotions being put forth by retailers that now encompass the use of social networks such as Facebook and Twitter. Cyber Monday - the traditional kick-off to the online holiday shopping season - and the subsequent weeks will be the real test for how online retailers fare this season. That said, this is a very encouraging start."

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Black Friday

2009-11-29T17:14:00.000-08:00

By Stefanie Marty

When thinking of Black Friday people think more of big sales rather than just the day after Thanksgiving. Black Friday is traditionally known as the biggest shopping day of the year and even this year during the recession not only retailers, but also consumers were excited for the day to come about.

This year different bargains were expected with some of the lowest prices in recent years offered on electronic items. But it is important for consumers not to just go and buy stuff, there are some guidelines that should be followed. Online there are different tips about Black Friday shopping given to consumers.

As a consumer research the offerings online in advance and if possible, pre-order the products online. Dealnews.com or theblackfriday.com are two websites that contain information about the available discounts.

Futher it is important to make your Black Friday sales early because bargains will sell out faster than ever. This year consumers are really looking for bargains and since the levels of inventory are lower than ever, not a lot of massive markdowns will be available. But it is also important not only to look at the bargain and thus the price. Have a plan and think of what you really need, in other words think of value instead of savings and know what you are looking for.

A certain pattern was noticeable at this year’s Black Friday shopping. Even though there were some great electronic bargains offered, consumers stuck to the basics (clothing, sports gear, and watches). This shows that due to the recession more money is spent on practical gifts rather than on games and just fun items.

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"Free" credit reports- just not true

2009-11-29T16:59:00.000-08:00

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

Instant approval credit cards

2009-11-29T16:55:00.000-08:00

by Tiffany Mann

Posted by Michael Rivezzo

Qualifying for an instant approval credit card is much more difficult today than it has ever been. We can all remember getting offers in the mail for 0% APR for an introductory period on credit cards. It was almost a given if we applied for these cards we would receive the card in the mail a few weeks later. That is no longer the case today.

There many bad credit borrowers out there who are being denied credit cards. If your credit score has declined over the last few months you may find that credit cards are very lenient when deciding to give you access to lines of credit. They realize that missing payments from borrowers is causing them to lose money over the long run.

If you have missed a credit card payment
or any type of loan payment over the last year you are likely going to find your credit score has greatly dropped. If your credit score has dropped you are also going to find that the interest rate on your credit cards increase drastically. If you apply for a new credit card you are also going to find that the interest rate is much higher than you would have ever imagined.

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Consumer Finance Tips for Holiday Shoppers

2009-11-29T15:36:00.000-08:00

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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Harvard Business School's New Curriculum: Everyday Finance

2009-11-29T14:32:00.000-08:00

Posted By: Lisa Matthys

Written By: David K. Randall

Harvard Business School is the place where the chief executive officers, hedge fund stars and Goldman Sachs ( GS - news - people ) partners of tomorrow learn their craft. Now, in a break from tradition, a new course is focusing on the troubles of everyday consumers.

Consumer Finance, as it is known, will look at topics ranging from the best ways to boost the savings rate to how banks can deliver better products for low-income customers. Instead of proceeding along the conventional HBS path and delving into corporate case studies, students will focus on the financial lives of real middle-class families. In one exercise, they create a budget for a Boston family of average means, figuring in costs for such everyday staples as food, transportation and insurance.

"By the time our MBAs graduate, they will have looked at financial statements for hundreds of companies," said Peter Tufano, the professor who teaches the course along with Howell E. Jackson, a faculty member at Harvard Law. "Other than in our course, they would have never looked at the financial statements of a single household."

Traditionally, business schools have shied away from teaching consumer finance, despite the fact that households represent $61 trillion in assets. As business schools grew in the 19th century, they traditionally taught men how to run corporations, while the study of household finances became the focus of programs tailored to women.

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When Marriage Means Medical Bills

2009-11-27T17:31:00.000-08:00

Posted By Pete Hill

Q: My fiancé, Alan, recently had a heart attack. If we go ahead with the wedding, he will be covered by my health insurance (he has none), but I'll become liable for all his current medical bills. What should I do?
A: Like Humphrey Bogart in Casablanca, you've been misinformed. Individuals are not legally liable for debts their spouses incurred before they were married. As a practical matter, though, those bills do indeed come with your fiancé. The fact that you're not personally on the hook doesn't mean that, as a couple, you won't have to figure out how you're going to pay them off.
We understand why you're reluctant to put yourself in this kind of hole. But before his heart attack, Alan was the man you were committed to spending the rest of your life with, and now he really needs you. Are you obligated to marry him? No. But you do have a big-time moral obligation to help the guy out.

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Guide to Online Holiday Shopping

2009-11-27T14:47:00.000-08:00

By Quang Nguyen

With the advancement of the Internet, there are many ways to save money on online shopping for this year's holiday sales. Instead of going straight to the store's website, there are other websites that help you compare prices. You can go to FatWallet.com, Ebates.com, or a credit card issuer's online shopping portal to help you make intelligent decision. Beside getting a better deal, you can also earn extra rewards or get cash back from your credit cards.

In order to reach out to the new generation of Internet users, companies are now on sites such as Facebook and Twitter to promote their products. When you get connected to their pages, they will offer you special promotions that you don't see on regular ads. National stores such as JCPenney and Best Buy are part of this innovation.

Credit card companies also try to push sale through the use of their cards. Chase recently has a program where they pay for a random's customer bill when he or she use Chase card. Bank of America has a program called Add It Up where you get point on the amount of money you spend on their card.

However, customers need to be smart when making decision. There are a lot of scams on the Internet. For example, they could get fake products. The popular hamster toy Zhu Zhu now has an imitated version called Zhu-Zhus. Some websites also appears just for this holiday sale season to steal people's identities and credit card information. In addition, beware of phishing emails from eBay and PayPal. Moreover, sites that are collecting donations are mostly fake.

Sources:
http://www.nytimes.com/2009/11/28/your-money/28money.html?ref=business
http://www.msnbc.msn.com/id/33670121/ns/technology_and_science-tech_and_gadgets/
http://www.katv.com/news/stories/1109/681903.html

Do Not Overspend during the Holiday Season!

2009-11-27T13:31:00.000-08:00

Post by David Held

With the Holidays coming around consumers must be careful in regards to what they spend. It is expected that everyone will be spending, but some people will spend more than they can afford. It is crucial that consumers monitor what is in their bank accounts and budget accordingly.

Credit cards and debit cards can become a recipe for disaster. If I had to pick between the two I would go with a debit card because one you use the card it directly takes the money out of your bank account. Credit cards allow people to spend money that they do not have. I prefer cash over both types of plastic because when purchasing with cash it actually fells like you are giving up something for something in exchange, which is not the case when you use plastic.

If consumers overspend using their debit cards they will be hit with overdraft fees. If people overspend with credit cards, at first nothing will happen, but if the consumer cannot afford to pay back credit card companies their credit scores will decrease. Having your credit score go down makes it extremely difficult to take out loans, mortgages, etc (which can be a real problem if you are young). It is crucial that consumers not overspend this holiday season, especially since the economy is miserable.

Sources #1, #2, #3

U.S. Looks to Australia on Credit Card Fees

2009-11-27T12:50:00.000-08:00

Post by David Held
By KEITH BRADSHER

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

2009-11-24T09:42:00.000-08:00

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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New agency tackles consumer finance

2009-11-24T06:52:00.000-08:00

Posted By Ahmed Al-Salem
Article By: Jane Smith

The Government has announced plans to set up a new agency to take over the role of consumer financial education from the City regulator.

The Consumer Financial Education body will promote financial literacy and provide financial information for consumers and oversee the rollout of the Government's Money Guidance service.

The service will offer free financial advice - on topics such as mortgages, pensions and savings accounts - which was previously only available to people who could pay for it.

The new agency will be funded through a levy on financial services firms.

The Government also plans to help consumers get redress more easily by introducing US-style class actions under which a consumer representative will be able to bring an action to court on behalf of a group of consumers.

The FSA will also have its powers strengthened enabling it to force banks to set up damages schemes when large numbers of customers have the same valid complaint, to make it easier for people to get compensation.

Read On

Buy to let and consumer finance group Paragon full year pre-tax profits rise 1%

2009-11-24T06:42:00.000-08:00

Posted By Ahmed Al-Salem

In its full year results for the period ended 30th September, specialist buy-to-let and consumer finance lender, the Paragon Group of Companies said it has fared well with increased profits and above-industry-average arrears performance.

According to Paragon, it has emerged strongly from ‘a deep UK recession and continuing turmoil’ among credit and banking markets. The specialist lender said its business strategy was established well before the crisis took hold; it has a fully securitised book with a high credit quality loan portfolio and strong operational management.

Group pre-tax profits increased by around 1% from the previous year to £54.3 million, earnings per share(‘EPS’) was lower at 13.9p, compared with 17.9p compared with 2008, however, the EPS figure was influenced by a rights issue in February 2008. Paragon increased the final dividend to 2.2p per share, the total full year dividend for 2009 will now be 3.3p per share.

Paragon Chief Executive, Nigel Terrington commented on the group’s performance over the full year and its outlook going forward:

"In a year which has seen a deep UK recession and continuing turmoil in credit and banking markets, the Group has fared well, significantly strengthening its position at a time when many of its competitors have failed. The Group enters the new financial year well capitalised, with the loan portfolio match funded to maturity, no debt maturing until 2017 and a strong cash position ... Whilst these are early days, recent improvements in funding markets will encourage us to look more confidently to reinstating the funding programme to support new lending going forward."

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PersonalFinance: Card tricks for managing credit

2009-11-21T07:49:00.000-08:00

Posted by Stefanie Marty

Written by Linda Stern

WASHINGTON (Reuters) - You're not the only one whose credit cards seem to be getting worse; it's happening to everybody. For those who find solace in that, the Federal Reserve Board has delivered it with a new survey of bank lending practices.

The Fed found the vast majority of banks increasing interest rates on credit cards, even on good-credit customers. Issuers are cutting borrowing limits for many customers and raising the credit scores they'll require before approving new card applications. They're adding annual fees to rewards cards and hiking the costs of cash advances and balance transfers. And those great zero percent deals? Dead, dead, dead.

Much of this is happening as bankers position their cards for the tougher new regulations that take effect next summer. By the time those rules kick in, cardholders will have had to swallow most of these new policies and practices. Who knows what will be left to regulate?

You don't have to wait until then to fight back. Here's how to take back control of your cards now.

Click here to read more

Decline in U.S Consumer Credit

2009-11-21T07:20:00.000-08:00

Written by Stefanie Marty

Statistic from the Federal Reserve shows that U.S. consumer credit has fallen in twelve of the past 14 months to a current amount of $2.46 trillion. This amount is 4.7% lower than a year ago. Alone in September consumer credit fell by a 7.2 percent annual rate. This change of credit includes revolving as well as non-revolving debt. Revolving debt credit includes most credit cards and accounts for an amount of $889 billion. This kind of consumer credit fell at a 13.3 percent annual rate in September. On the other side the non-revolving debt, which includes auto and personal loans, fell at 3.7 APR to $1.57 trillion.

Different factors account for this decline in consumer credit over the last year. During the recession unemployment increased, incomes stagnated in many job segments, lenders tightened their credit conditions and consumers got more conservative with their money.

In the long-term the declining balances are seen as a positive sign by most economists. But in the short-term consumer spending and thus the U.S. GDP will suffer. With 70% of the GDP consumer spending accounts for the bulk of the U.S. economy and with the new development economists wonder whether consumer spending will occupy such a large space in the U.S. economy in the future. People are concerned about the U.S. GDP growth, which decreased due to the decline in consumer credit. But still, this development is new and it is too early to worry already about the U.S. GDP growth.

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California Tuition Increase

2009-11-20T12:23:00.000-08:00

By Shawn Chandok

On Thursday November 29th, the Regents Board of California state once again agreed upon raising tuition for University of California colleges by 9.3% or approximately $662 dollars per credit by fall 2010. The increase in cost was due to the current $450 million dollar deficit. Currently more than 884 employees statewide have been fired due to budget cuts in and the number is expected to increase to over 1000 by the end of December 2009. University of California President Mark Yudof hopes “The student fee hike will generate approximately $152 million in revenue, and has $54.2 million designated for undergraduate and graduate student financial aid. The rest will be to cover state budget reductions, student support services, mental health services, and other mandatory cost increases.” Furthermore, Yudof mentioned the tightening on admissions for California residents in order to attract out of state students whom would pay full out of state tuition costs. As expected, this has caused quite a bit of commotion amongst students who have begun protesting outside the Regents building with signs labeled “RIP Our Future, and Stop Increasing the price of our dreams.” The biggest fear students face currently is the fact that they might have to stop attending collages anywhere from 1 semester to a year, simply to get another job to pay the tuition costs.

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Where to Get a Loan?

2009-11-18T13:44:00.000-08:00

Post by David Held

About three years ago any bank, credit union, finance company, etc was willing to give almost anybody a loan (and even mortgages), but currently not many people can get loans. Since the economy crashed, about a year to date, it has been extremely hard to borrow money from anyone, especially a large sum of money such as a mortgage. This reason for this was because banks had an abundance of money and were willing to lend it to subprime clients (clients who have bad credit). Once the loan was given than the banks would pool the loans, give them a rating (A, B, C), and sell them to investment companies or the general public. Sooner or later most of these people couldn’t pay back the loans so the only option they would have is to default. Now we are currently feeling the wrath of the poor decisions that the banks, credit unions, finance companies, etc made.

Unless you have a perfect credit rating you cannot get a loan. Now the loan terms are not going to be favorable for a long time. The best advice is to save up until loan terms become favorable. If you do decide to invest in a time like this, make sure you have a diversified portfolio!

Sources #1, #2, #3

Credit Card Companies Willing to Deal Over Debt

2009-11-18T13:29:00.000-08:00

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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College Expenses

2009-11-17T08:22:00.000-08:00

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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Stick with Stocks

2009-11-16T21:20:00.000-08:00

Posted By Pete Hill

If you're depending on your investments for spending cash in retirement and you don't want your spending power to fall behind inflation, then you want your portfolio to have the potential for capital growth over the long term.
Getting enough growth to maintain your purchasing power throughout a lengthy retirement is difficult if you invest only in cash equivalents like money-market funds and CDs. Although there are no guarantees, investing a diversified portfolio of stocks and bonds gives you a much better shot at getting the long-term gains you need.
Yield stocks always make sense. And even in tough times you can find companies with solid payouts. This is shaping up as the worst year for dividend cuts in three generations. Striving to conserve cash amid the most severe slump since the Depression, companies are reducing or eliminating their payouts to shareholders.

But dividends are not dead. Some companies maintained or raised them in the past year, indicating that their payouts can survive even the worst markets. And dividend investing remains a sound course amid market turmoil.

Even though stocks are still well below their 2007 peak, they can no longer be considered cheap, with the price/earnings ratio for companies in the Standard & Poor's 500 now nearly 20% higher than its long-term average.
The good news is that those profits will probably materialize. Analysts look for operating earnings for S&P 500 companies to rise 27% from recession-battered levels, fueled primarily by improving economic growth overseas and a further weakening of the U.S. dollar which would increase exports.

Sources:
http://money.cnn.com/2009/11/05/pf/expert/retirement_stocks.moneymag/index.htm
http://money.cnn.com/2009/11/06/pf/dividends.fortune/index.htm

http://money.cnn.com/2009/11/09/pf/Make_money_investments.moneymag/index.htm

The Consumer Financial Protection Agency

2009-11-15T18:33:00.000-08:00

By Rico K Setyo

The initial purpose of proposing to create an oversight group of consumer lending was to protect the average American consumer. The original bill was pushed by House Financial Services Committee Chairman Barney Frank, a democrat from Massachusetts. He believes that this bill will be able to regulate how consumer focused financial products is administered and protect consumers from fraudulent activities.

However, many republicans have opposed Frank’s original proposal because of one aspect of the bill. In Frank’s original bill, he wanted the agency to be run by a single director, but the idea of giving one person an immense amount of power struck people with concerns. Joe L. Barton, a republican and Henry Waxman , a democrat wanted to amend the current proposed bill which “would replace that single director with a five-member bipartisan commission”.

The single directorship is not the only issue many people are arguing about. Many republicans are just arguing the fact that Frank and President Obama are proposing to create another agency to oversee consumer lending. Eric Cantor, a republican states that “increased government regulation isn’t always the answer… we need, perhaps, smart regulation, but more [isn’t always] the right solution.”

Many people are still proposing different changes to the current bill. As of now nothing has been finalized yet, the creation of a consumer financial protection agency might not be anytime soon since it still has a lot of work ahead of itself.

Source 1
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Invest like Warren Buffet

2009-11-15T17:43:00.000-08:00

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.

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."

Link 1
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U.S. consumer spending will likely influence markets

2009-11-15T17:40:00.000-08:00

Posted by Rico K Setyo

By The Canadian Press

The latest reading on consumer spending activity in the United States will likely set the tone for trading on stock markets this week.

U.S. retail sales for October are released Monday and economists expect to see a rise of 0.9 per cent following a drop of 1.5 per cent during September.

"It looks like that's going to be the big one," said Colin Cieszynski, market analyst at CMC Markets Canada.

Stock markets ended last week higher for a second consecutive week, largely on investor relief from indications that U.S. interest rates will stay low for an extended period.

Markets were also lifted by last weekend's G20 meeting where leaders made it clear that government stimulus measures will not disappear any time soon.

But critical to that growth on markets has been the hope that the end of recession will be followed by a strong recovery.

While retail sales are important in any economy, they're particularly important in the United States where consumer spending accounts for about 70 per cent of the economy.

And there are searing memories of what happens when consumer strength collapses.

"When the U.S. consumer got tapped out, that was one of the big things that led to the collapse of the housing market and that dragged down the whole banking system with it," observed Cieszynski.

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Most bank customers use online banking regardless of risks

2009-11-15T17:34:00.000-08:00

Posted by Michael Rivezzo

GE Capital Retail Consumer Finance Extends Credit Card Program with Meijer

2009-11-15T17:26:00.000-08:00

Posted by Ahmed Al-Salem

GE Capital Retail Consumer Finance, a consumer lending unit of General Electric Company has announced a 5-year extension of its credit card program with family-owned, Midwest retailer Meijer, providing credit services and valuable programs to shoppers.
The program started in 2003 with the launch of their first-ever private label credit card program for Meijer.

In a release, the Company noted that since launching the private label credit card with GE, the relationship has expanded to include a general purpose Meijer MasterCard, and a prepaid card program both accepted at establishments outside of Meijer's.

With 190 super-center locations and 174 gas stations in 5 states, Meijer credit cardholders enjoy a wide range of valuable benefits. The credit card program features a first purchase discount, monthly sale events, and 5 cent/gallon gas discount. The Meijer MasterCard also provides cardholders rewards on purchases made at Meijer as well as at other retailers.

"The Meijer Card allows us to help our loyal customers save even more money at Meijer in ways that only Meijer Card customers can. Meijer Credit Cards make a dollar go further on purchases that every family needs, helping them in these tough economic times. We are pleased to be extending our relationship with GE which provides customers with a program that enhances our sales and provides unique benefits to cardholders," said Jeff Handler, Senior Vice President of Marketing and Advertising.

Read On

Banks Intend to Buckle Down in the Face of Credit Card Legislation

2009-11-15T17:22:00.000-08:00

Posted by: Lisa Matthys

Written by: Garrett W. McIntyre

In the FED’s most recent bank survey they asked how the banks indented to deal with the Credit CARD Act of 2009. The Act meant to protect users from sudden interest rate spikes on their credit cards. Its main provisions limit when lenders can raise rates on existing balances and also require lenders to alert card holders of increases.

Of the banks surveyed, 75% of respondents did not expect to be in compliance with the legislation until February 2010 when most of the Act takes effect. Banks reported that they intended to, or already have, tighten the terms of credit card loans to both prime and nonprime borrowers. About half of the respondents indicated that they would increase interest rates and reduce credit limits for prime borrowers. A bit less than half intend to raise the minimum credit score required to obtain a loan. 75% of respondents indicated that they would raise rates on nonprime borrowers.

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Fed Tightens Rules on Overdraft Fees

2009-11-15T17:13:00.000-08:00

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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How to Invest Your 401(K)

2009-11-15T12:57:00.000-08:00

Posted By Pete Hill

NEW YORK (Money) -- Question: I've got many investing options in my 401(k) -- small caps, large stocks, emerging markets, fixed-income, etc. What would be the ideal portfolio for me considering that I'm 51 and plan to retire at 65? --D.D., Anaheim, Calif.
Answer: While it may be theoretically possible to create an ideal investment portfolio, it ain't gonna happen in the real world.
More than 50 years ago, Nobel Laureate economist Harry Markowitz created a technique known as mean-variance optimization, which investing firms use today to create "optimizer" software designed to pick your ideal portfolio. You get a combination of investments that will generate the best possible return for whatever level of volatility you're willing to accept.
But the problem is that the portfolio you get is designed to excel under a very specific scenario -- the exact volatility, correlations and returns you stipulate. If your predictions about those things don't pan out -- which is invariably the case -- the portfolio's performance may not only be less than optimal, but downright abysmal. It's sort of like designing a bike to maximize performance in the Tour de France but then finding out the race will be held not on paved roads, but on a rutted dirt track.

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2009-11-15T10:45:00.000-08:00

Posted by Stefanie Marty

By Sandra Block, USA TODAY

Robyn Davis Sekula of New Albany, Ind., gives gift cards to friends, family and clients every year, and this year will be no different. Many people on her gift list live far away, and gift cards are easy to ship. But the main reason she gives gift cards is that she loves receiving them and believes others – especially her "mom friends" – do, too.
"For me, a gift card is a license to shop with somebody else's money," says Sekula, a 38-year-old marketing consultant. "It's a wonderful excuse for me as a mom of three little kids to go into a store and shop and do all the things I don't do when my kids are with me."

With the holidays approaching, retailers hope gift cards will provide one of the few sparks in a shopping season that's otherwise likely to be lackluster. Gift cards remain the most-requested item on consumers' gift lists, according to the National Retail Federation, making them attractive to value-conscious shoppers who don't want to waste money on unwanted presents.

GIFT CARD TIPS: Before you buy one, check the rules

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Credit Cards at Department Stores

2009-11-15T10:32:00.000-08:00

Written by Stefanie Marty

Last week GE Capital Retail Consumer Finance renewed its private label credit card programs with the two US retailers Meijer for five years and JCPenney for four years. Meijer’s management said that such a program helps loyal customers to save even more at its store. Such programs provide credit to millions retail customers and have attracted a lot of attention in the market. Even though such a card may seem a great deal at the first glance people warn consumers of such credit cards because of different reasons.

By applying for a JCPenney card you get 10% off your first purchase and it allows you to be on the list for some promotions and events held at the store. These are the characteristics that attract a lot of consumers.
But if you take a closer look, you will see that there are many negative features that lower your spending power. First, the credit limits on JCPenney and other department stores credit cards are very low. Even people with good credit records cannot cover their monthly shopping expenses with their credit limit. Second, the interest charged at such credit cards are ridiculously high, up to 21.99%, and unless you can pay the outstanding amount at the end of every month, such a credit card is nothing for you. Third, once they signed up many consumers complain about insufficient support.
Before you apply for a credit card at any department store, consider all your other options. Many times there are other options that give you much better rewards and a higher spending power.

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Teaching Kids Finance

2009-11-10T11:01:00.000-08:00

Posted by Chris Keeler

Viewers share money-saving tips

2009-11-10T10:16:00.000-08:00

Posted By: Jessie Bruyn

Saving for a house isn't that hard

2009-11-10T10:14:00.000-08:00

Posted by: Jessie Bruyn

NEW YORK (MONEY Magazine) - Where the hell did you get the money?" That question has been popping into my head as more of my friends tell me that they're buying a house.

Social graces and feelings of inadequacy stop me from saying it aloud, but come on, I think to myself. You work for a nonprofit and your husband's a teacher. You're telling me you scrounged up 50 large for a down payment by eating out less and clipping coupons?

Their parents probably helped (not that there's anything wrong with that) or they got an inheritance (that either), I think to myself. Or maybe they're part of the increasingly - and disturbingly - high number of first-time home buyers who put no money down (43 percent, according to the National Association of Realtors).

But recently, another possibility struck me: What if they really did save it up themselves? What if they actually made some smart moves to rack up a down payment quickly?

At first, this possibility caused me some dyspepsia - the closest thing my wife and I have to a down payment is whatever's in the coffee can on the dresser.

But after that feeling passed, I had a wonderful revelation: My God, it's possible! Now that I - and, I hope, you - are seeing that coffee can as half full, where to begin?

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Finding a Job In a Recession

2009-11-09T21:10:00.000-08:00

By Nicholas Vanikiotis

Landing a job in a down economy can be extremely difficult, especially if you happen to be much older. Times are rough and budgets are tight from large companies all the way down to the mom and pop shops. The unemployment rate is the highest it has been since the great depression. And for those unlucky workers who are out of a job and don’t have enough money to make it through the next few months, now is the time to shine and stand out in that interview.

Having a stellar resume just isn’t enough to land you jobs anymore. There are over 12 million other Americans looking for a job so standing apart from the crowd is crucial now more than ever. There are many key things to do as preparation for a job interview, such as the following:

1. BE PROACTIVE

2. Network

3. Call your friends, families, and former colleagues about opportunities

4. Perfect your resume-short and to the point

5. Prepare for the interview by researching the company-be ready to talk about the industry of the job you are applying for

6. Hone your Communication skills

7. Demonstrate how you will impact the company with your position within the first 30 days

8. Be Confident

Once you land the job it doesn’t mean that you set, it can be taken from you if you do not perform. This is why it is important to put forth 110% effort onto the job and let your boss know that you are constantly thinking outside the box. One example is of a man who, on CNN.com, said that he would periodically send his boss interesting news articles with a few comments.

Sources:

http://money.cnn.com/2009/03/27/news/economy/yang_jobhunters.fortune/index.htm

http://www.cnn.com/2008/LIVING/worklife/09/29/cb.job.searching.recession/index.html

http://blogs.wsj.com/laidoff/2009/11/09/advice-seeking-work-at-a-small-company/?mod=blogmod

Businesses get a break in unemployment bill

2009-11-09T15:25:00.000-08:00

Posted by Nicholas Vanikiotis

NEW YORK (CNNMoney.com) -- The unemployment insurance bill that President Obama signed Friday won't just help the jobless and the homebuyer. It also includes a long-awaited break for businesses that will let them quickly turn their recent losses into cold cash.

The bill will let all businesses apply their losses from either 2008 or 2009 to any five years prior to 2008. By doing so, they can get a refund from the IRS on the taxes they paid for those five years.

A loss is defined as the amount by which a company's tax deductions exceed its gross income.

Under current law, the so-called "net-operating loss carryback" is only allowed for two years.

There are only two restrictions to the new provision. The first is that no business that has accepted funding from the Troubled Asset Relief Program (TARP) would be eligible for the break. And the second is that any refunds for taxes in the fifth year would be reduced by 50%.

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Dodd Seeks to Freeze Credit Card Rates

2009-11-08T12:00:00.000-08:00

Posted by: Janielle Viggiano

WASHINGTON -- A top Senate Democrat moved Monday to impose an immediate freeze on credit-card interest rates, as congressional Democrats continued pushing to rein in financial-sector practices.

Sen. Christopher Dodd of Connecticut, who heads the Senate Banking Committee, introduced a measure that would freeze rates on existing card balances until February, when tough new rules for the industry are slated to go into effect.

Mr. Dodd said he was making the move because companies are using the delayed implementation of the new standards, passed by Congress in May, to push through aggressive rate and fee increases. "No sooner had it been signed into law, but credit card companies were looking for ways to get around the protections," Mr. Dodd said in a written statement.

The measure is part of a populist push by Mr. Dodd, a fifth-term senator facing a tough re-election battle against former Republican U.S. Rep. Rob Simmons next year. Mr. Dodd's ties to the financial-services industry and his receipt of a home loan from former Countrywide Financial Corp. have hurt his standing with voters. He was cleared of violating Senate ethics rules in the mortgage issue.

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New Law on Credit Card Rates

2009-11-08T11:57:00.000-08:00

Posted by: Janielle Viggiano

The U.S. House voted on Wednesday to freeze credit-card interest rates and fees for nine months and to immediately impose strict new credit card rules currently set to take effect on February 22^nd or later. According to the Wall Street Journal, “the 331-92 vote comes after lawmakers have been flooded with complaints from consumers furious that issuers raised interest rates, increased minimum payments and lowered credit limits. Dozens of Republicans joined Democrats to approve the measure (2009).”

Credit card companies are getting ahead on restrictions and boosting interest rates. Bugg’s stated, “The average rate offered to a consumer with a solid 700 credit score is now 11.51 percent on a variable rate card, up from 10.66 percent in March, according to Bankrate.com. And a report released last week found that 100 percent of credit cards offered online by the largest 12 bank issuers in the United States continue to include practices that will be illegal when the Credit Card Accountability, Responsibility and Disclosure Act, passed in May, takes full effect next year (2009).” In some cases rates are doubling as high as 30 percent or more even for people who are paying their bills.

According to the Associated Press, “The changes required under the Credit Card Accountability, Responsibility and Disclosure Act, or CARD Act, could go a long way to stop deceptive practices in the card industry. But before that happens, card issuers are grabbing what they can from the millions of Americans who are their customers (2009).”

Sources: http://online.wsj.com/article/SB125736960554828923.html?mod=WSJ_hpp_sections_business

http://www.chron.com/disp/story.mpl/business/buggs/6697892.html

http://www.google.com/hostednews/ap/article/ALeqM5iZnfNIDibBZ2lgBu_KVRX_wauO2AD9BLGMAG0