Archive for March, 2008

Some say yea, some say nay,

We have reached one of those defining moments.  Questions abound as to what is the solution to take to deal with the credit crisis.  On the one hand, the government in power apparently believes in the approach of patching the tire.  Soon or later they guess we will get to a gas station and we can buy a new one and then continue on our trip to the free market future.  Meanwhile, they want to throw in some new rules for the drivers, read lenders here, and the passengers, read you and I and all the rest of the taxpayers here.

The government not in power, has some suggestions too.  If you are going to patch anything, they say, it ought to be the consuming, bankrupt home owning, middle class wage earning, and health care without ordinary person.

Then there are the people not in power, bloggers just like you or I, who have some ideas too.  Hellasious at Sudden Debt says don’t fix anything while Jon Taplin at taplinsblog say we need to address the budget with a view towards a new Federalism.

Where we will be tomorrow no one really knows.  Really.  But I am open to suggestions if you care to make them.

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Weekly tags

The first stop on this week’s tour is New Zealand where we encountered the NZConservativesas they blogged on the environmental movement’s idea of turning off the lights for an hour.  I saved a lot of money by just travelling the airways and had a great time jumping into the discussion.  The conservatives down there sound quite a bit like the ones we have up here –thoughtful, sarcastic, confrontational, and almost willing to listen.

Next on the agenda, we arrived back home to the enjoyably light hearted Milk in the closetpersonal finance blog.  Here’s what the author had to say about her point of view:

Milk in the Closet – a blog about faith, parenthood, and whatever else pops into my head.

As a former teacher, Christian, and downright opposite of everything this sweet little blog seems to be about I couldn’t help spending time browsing through and seeing what the other side is thinking about these days.  Reminds me of my own youth when it was twice on Sunday and once in the middle of the week for me.  You know it might not be so bad for me to keep in touch with her kind of sincerity.

After that we settled down to a good old session of blogosphere styled research as we visited several sites to try and get a handle on the economic crisis facing the country. 

Sudden Debt is a site run by economist calling himself, Hellasious and as he explains, he was:

Educated as an engineer, almost my entire professional activity has been in finance, particularly in money, FX and credit markets and their derivatives. PS: I can spell fine. “Hellasious” stands for “Hell as IOU’s”.

I admire and envy the bloggers who can explain clearly and demonstrate with graphic examples.  This guy is definitely a hard contrast to Ms. MC and well worth the visit. 

Publius2012 looks at the responses to the environmental peak crisis and sees a return to the land as the solution.  Simplify, cutback, use less, waste less, and yes, see this through a progressive’s eyes. You don’t have to look very far to see this perspective these days.  But I strongly advise that if you want to understand the mix you had better be ready to read all the labels. 

Price of Oil the title seems self-explanatory for this blog but I have to say that the degree of information and the diligence at which it is appearing on the web is astounding.  Opinionated, yes.  Backed up by hard facts and a ton of research, that too.  We just need to figure out how to keep on sharing and using what we know.   Things are bound to get better, aren’t they?

Well that’s it for this week folks.  I hope you had fun, too.

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No habits

Okay, here’s the truth.  I seem to find it easy to get up early and get on the computer to write.  It has become a habit of sorts.  Somewhere around 5 in the morning my inner alarm clock starts chiming.  My eyes blink open and I lean my pillowed head forward.  Yes, the red illuminated face of my clock tells me it’s that time again.

Down the hallway to the kitchen I go trying to move quietly so as to not wake T.  Fill the pot with enough water for a 48 oz cup, filter in the one cup strainer, rinse the cup, place the strainer on the cup, wait with book or newspaper while the water begins to steam, pour the water through, sweeten with unrefined sugar (one and a partial soup spoons), add milk (whole) and start the day by walking back to my office and cueing the computer.

Now that’s a habit.  I even get grumpy if I sleep in and somehow forget to do the coffee part.  I remember how for a brief period back in the 80’s the medical advice was all about cutting out the caffeine but somehow the coffee lobby managed to scuttle that ship before it sailed very far.  Now we have Starbucks on every corner unless the economy makes them cutback in which case the awful coffee they make might disappear just like all the other fads like hoola hoops and yoyos.  I like my coffee way better anyway.

So now I’m at the computer and I almost make it to my blog and the write a post button but not quite.  This is another habit I have of looking around at what happening in the blogosphere before I write my own post for the day.  Mostly I can make my self override this habit by just clicking my way to my blog without stopping.  Log in, select blog, select write a post, and then voila’ I’m ready to ramble.

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About that will . . .

I found this link today while reading JD’s blog, getrichslowly.  It was a mention of a will writing kit from Suze OrmanOf course, now I am doing the research.   The kit is like $14 plus shipping and it apparently does it all.  The problem is that we wanted to make sure everything was done correctly and legally.  Now I am really being stuck with a bad case of buyer’s remorse.  But part of the problem of partnering is accepting the other person’s way of doing things.

Say you decide to implement a budget.  The first step for the two of you is to sit down separately and list out what your income is versus what your expenditures are.  Seems simple on the surface but when I sat down to do it I ran head first into my own spending habits.  I have a tendency to give in to my partner’s needs on the little things and in the short term.  This means that sometimes I have to borrow from my savings in order to do something that she wants.  The problem comes from the fact that for the most part I keep these financial manipulations from her.  I like to keep an even keel in my relationship to money and a life time of ups and downs has basically taught me how to stay calm while using my credit or savings.  She, on the other hand, is a worrier.  Her rule of thumb being if I worry about everything then for sure something will go wrong and I’ll be proved right to have worried about it.

Another thing about partnering is that between the two of you there might be a disparity of needs.  Take this will thing.   I have always travelled light.  I like to think that I need very little beside a good book to read, paper to write on (or a blog), and my bike.  My other material possessions are personal. I have a will.  It’s very simple.  Whatever is left goes to T.  She is already my selected survivor on my checking and  saving accounts.  We hold title to our car jointly.  The rest of what I own, books, writings, music, and art will go to her.  Their monetary value is small.  Everything else in our partnership, the corp, the real estate, the vehicles, are already in her name. 

She has a will, too.  We purchased a blank pre-formatted one from a stationary store and went over all the details of naming her survivors, and determining who gets what from her personal and business interests.  It was a straight forward listing that we then notarized and she mailed to herself. 

But, yes but, nothing is ever that simple.  There are other considerations.  As I mentioned in a previous post, T recently became much more conscious of the what ifs.  What if she became incapacitate, what if all of her estate had to go through probate, what if …?  So even though we had already set up a whole life insurance policy and she had survived her recent surgery,  it still seemed like it was time to take care of the other contingencies by setting up a durable power of attorney and nomination of conservator, a living trust, and a medical power of attorney.  And here is where those difference between partners came up again.

I consider myself self-sufficient.  If I need to figure something out, I know how to do it and usually I feel comfortable with the decisions I reach.  T, on the other hand, likes to vet her decisions through others.  For instance, she could go online and find out just about anything she needs for investing.  She is in fact quite well-versed in charting stocks, and in handling her own portfolio.  Yet, every year we spend a couple thousand dollars attending workshops and seminars that teach the very things she already does well.  It’s just that she needs the confirmation that comes from seeing that someone successful, more successful, has done what she does.  So when it came to a will that worked and that she would have confidence in, we couldn’t just go to the shelf.

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Thoughts on the 5 years of war

It is almost impossible to miss the reminders. US losses reach 4,000.  Cost of the war to reach $3 trillion dollars.  Another suicide bomb kills 4.  Watch PBS tonight at 9 for the first of a two part show called Bush’s War.  Everyone it seems has noticed that the war goes on.

I still think about back in the day.  It was 1969.  Living in a small 2 bedroom house behind my wife’s parents house were a marine Sargent and his Korean wife and three kids.  He was home briefly between tours and getting ready to ship out for a new destination, Vietnam.  As I worked on changing the oil in our International Harvester Travall, we got to talking about the why of it.  He had already fought in Korea as a kid.  That’s where he met his wife.  Soldiering, as a marine, was the only thing he really knew.  And yes, even though he was coming up on his 20, he thought he’d stay in.  But I was newly conscious of the war for what it meant politically, what it meant about the way our government, our politicians lied to us, and took advantage of the war for their own gain.  So I asked him, why was he going, why did he keep on going.   “Those people need help.”

I think of his answer when I try to understand the stories of the atrocities, the torturing, the bombing of civilians, and I wonder what he’d say to that.  But of course he can’t say anything to that because from his second tour in ‘Nam in 1971, he didn’t come back.

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Amex

So we are back from the day long series of workshops on using new programs to work the stock market via an Ameritrade event called Apexlive.  We received the classes for free – a $199 value – ‘cuz T has a trading account and a Suze Orman inspired “Save Yourself” savings account there.  It turned out to be a pretty good deal.  We drove up to the Marriot in Anaheim while we talked about her new interest in commercial real estate properties.  Then after sign in and grabbing a coffee and bagel (free from Starbucks and paid for by one of the software companies at the convention), we hit the first workshop which was an introduction to a software program, the Mutual Fund/ETF Screener, available online at Ameritrade.  It was designed to run a full analysis and comparison between ETFs and Mutual Funds and I found kind of enlightening.  I have gotten interested in this stuff lately because of the effect the credit swap industry has been having on the US and world economy lately.  Once you have selected a company, be it a Mutual or an Exchange Traded Fund, then you can input it into the program which then runs a profile of it next to similar products offered by other companies.  It comes with the ability to email your findings in case you’re working with a partner or a financial advisor.  There was not an opportunity to word the program there but the demo made it fairly clear how to access and play with the program through your own account.

The second class we went to was essentially one designed to bore us to death – portfolio guidance – and so I won’t go into it.

Class three, How to build a bond ladder, was the best for both of us because T has been laddering her CDs for the past year and again they introduced us to an online program, this time a Bond wizard the  lets you set up your program in a model so that you can actually run the outcomes.  In this class they ran several illustrations, one for setting up a ladder to fund your children’s college education.  The class leader couldn’t help but point out that his 529 was in the negative which couldn’t happen with bonds.  He obviously didn’t come prepared to discuss Bear Stearns.  Anyway, another model we ran was for a retirement program someone wanting to retire at age 60.  In both cases, the model used zero coupon bonds.

I couldn’t help but think of the transparency issue involved with any of these investments.  And even though I am a neophyte as far as financial analysis goes, I do know where to look to start finding some answers.

Meanwhile, we are back from LA and T is off to another commercial real estate seminar to try and interest our son in learning more about how it works.  Yikes.

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A trip to LA

Today we are heading up to LA for a day finance fun at the TD Ameritrade seminar on trading.  T loves to attend workshops and I don’t mind them if I can bring a book or laptop and do something useful while she learns and I listen.  Actually, the workshop is in Anaheim so technically that’s not LA but if you live out here it gets to be a habit to think of anything above Santa Ana as part of the greater LA nation.

The nice thing about it is that the Marriot has a great pool and the weather is 75 degrees and blue skies.  This is not to say that things aren’t serious what with the economic climate being not so sunny.  But for a day or two we are going to enjoy ourselves and think about solutions instead of problems.

Meanwhile, if you really want to get in on some great discussions about finance then tune in to this link: http://jtaplin.wordpress.com/ and get your brain thinking.

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