He wants to teach your kids about money. You should listen, too. (Photo: DIC Entertainment)

What have we learned about the way people handle money lately? Loose and lazy seems to be the general rule in America, in that people don’t tend to plan as much for the future as they should and operate on instant gratification. Lack of impulse control is common. Yet the current recession has been a deep, dark, truthful mirror of sorts, not only for ourselves but for our government. Just as we must manage our money well and make informed decisions, the government needs to do the same and stop shoveling problems under the rug. Hopefully, the Obama administration will start breaking some of the old ways.

But what about us?

Payday loans and unsecured loans offer short-term help, but what should we do over the long haul? We should look to any sources we can find to teach ourselves and our children about finance. First and foremost, it should be part of the core educational curriculum from a very early stage in schools.

However, there are other tools. For instance, Warren Buffett, the mastermind investor of Berkshire-Hathaway, has agreed to lend his voice to a new animated series called “The Secret Millionaire’s Club.” The idea behind this is to “get children to grasp basic finance lessons well before they do things like, say, agree to a risky, adjustable rate mortgage,” reports The Huffington Post.

Here’s Buffett’s idea

If we can get through to some young people, say it’s better to be ahead of the game than behind, watch out for credit cards, most important message is the best investment you can make is in yourself. Teach them if something is too good to be true it probably is. So if they learn those things the easy way through these stories early on it may save them learning the hard way later on.

He’s definitely enthusiastic about “The Secret Millionaire’s Club.” Here’s a recent CNBC interview:

Stock market looking up

Definitely animated (Photo: Poolparty.com)

People need to know about these kinds of things. People want to know what’s going on with the stock market. Specifically, whether or not they should start investing again. On that matter, Warren Buffett has had good things to say. Now that the Dow has hit 9,000 for the first time since January, he’s weighing in: “I would much rather own equities at 9,000 on the DOW than have a long investment in government bonds or a continuously rolling investment in short term money now. Again, I don’t know where it’s going to go next week or next month.”

So according to Buffett, investors should invest now. Business may still be flat, but as Buffett puts it, “If you wait until you see the robin, spring will already be over.”

Short term money?

Payday loans and unsecured loans are short term money. If your budget has a real need for that kind of boost, you can apply right here, right now. And be sure to check out “The Secret Millionaire’s Club” when it hits a computer or television near you.

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“A penny for your thoughts” – it’s such an annoying idiom. That anyone might attempt to enter into the sanctity of my thoughts for so little! However, I must admit that I’ve used the expression myself, despite the obvious insufficiency of the proffered legal tender. Worse yet, I have sometimes asked, “whacha thinkin?” without offering any consideration at all — as though I were entitled to have another’s thoughts for free. In a world that turns on money, how ever did I develop this mindset?

The unloved penny

In 2007 the Rockefeller Center hosted a display of 100 million pennies collected by public school children. These children obviously loved pennies.  But for many years a surging wave of adults has sought to abolish this humble coin. Grown-ups do not like pennies. Children may save pennies in a jar and use them to buy things. But if an adult puts a penny in a jar, it will stay there forever. Busy people simply throw pennies away.

Most overseas military posts and bases have done away with the penny. You can use pennies to pay, but you will not get them back in change. (By the way, did vending machines or pay phones ever accept pennies?)

Where did the saying come from?

Like so many English idioms, we really don’t know when this one got started. But we can be certain it was in use back when a penny still had some appreciable value. The saying appears in “Four Last Things” written by English humanist scholar Sir Thomas More in 1522. (More, it should be noted, coined the word “utopia,” but wore a hair shirt every day and was beheaded in 1535.)

The saying is most commonly attributed to John Heywood, an English writer of morality plays (and the grandfather of poet John Donne), who published it in a collection of proverbs in 1546. Heywood’s other famous epigraphs include “look ere ye leap” and “no man ought to look a given horse in the mouth.”

Which came first, the idiom or the coin?

“A penny for your thoughts” may have been in our vernacular long before More or Heywood published it. The first pennies were coined by ancient Celts in Britain, although they did not attain the hallmark of Roman-coin quality until sometime in the 1500s. But for all we know, the saying originated centuries before the coin when stone-age savages offered rocks in exchange for their comrades’ opinions.

Adjusting for inflation

But getting back to More and Heywood, in the 1500s a penny had some real value. Straightdope.com estimates that a penny in Heywood’s time was worth about $42.67 in 2001 dollars. If in 1546 you had deposited a penny in a bank account with an interest rate of 2% per annum, the account would have been worth $81.86 in 2001. Increasing the interest rate to 5% would make the account worth more than $43 million.

A reasonable offer for your thoughts

Unless you are a very skilled negotiator, you are not likely to get a reasonable person today to part with anything of value – let alone his or her considered and innermost thoughts — for a penny. Depending on how you look at it, another’s thoughts may cost you somewhere in the range of $42.67 to $43 million. This is not good news. If you need those thoughts anytime soon, an installment loan may be in order.

Steer away from risks with IBonds.

IBonds, iBonds or I bonds, whatever you call them, they are becoming more popular nowadays. It’s pretty obvious why: they are practically a no-risk investment.

IBonds are savings bonds issued by the U.S. Treasury and the interest rate is frequently adjusted for inflation. It is adjusted every six months, to be more precise.

Adjusting for inflation

Adjusting the interest rate on IBonds for inflation guarantees that the holder will get a real return on his or her investment. For example, say you keep your money in a savings account that gets 3 percent interest for a year, inflation goes up 3 percent that year. The savings account is technically worth the same amount it was a year ago. You haven’t made any profit.

The interest rate on IBonds is adjusted in such a way that you are always making a profit on your investment.

What’s the catch?

IBonds are meant to be a long-term investment. There is a penalty for pulling out funds before five years. If you cash out your IBonds because you need some debt relief or a quick cash advance, you will lose your last three month’s worth of interest. You can’t cash it out at all during the first year after it’s purchased.

Also, you can’t open one for your baby and then expect them to be able to retire on it at 65. IBonds only collect interest for 30 years.

More on IBonds

Right now, brand-new IBonds are earning a 5.64 percent interest rate plus a rate that is adjusted every six months. As you probably know, that is a lot higher than a traditional savings account at a bank.

Learn about how to purchase IBonds in Part 2.

Read the fine print on a pre-1933 bill: these promissory notes were redeemable for gold! (image by: geocities.com)

It’s turmoil as usual these days on Wall Street.

Sara Lepro reports for the Associated Press that gold prices are winding down as the dollar increases in value.  Oil prices are up, cash advance loans are steady and agriculture futures are down.

The United States dollar’s rise in comparison with the European Union’s euro and the British pound is what is pulling the value of gold downward. Gold is typically used as a “hedge against inflation” when the dollar is weak. Gold prices are also tied to what’s happening in equity markets. As Wall Street has been pessimistic in that regard, gold has suffered. April delivery is down $24.70 at $918 an ounce on the New York Mercantile Exchange. It is largely a lack of investing which translates into such a decrease in gold pricing.

Gold used to work differently

Bill Bonner of the Daily Reckoning gives us a historical perspective of the gold vs. paper debate. A gold coin at least retains its value over time, much as gold denari from Biblical literature would. “Images on printed in green ink on special paper,” however, tend to lose two to five percent of their purchasing power yearly. What will a crisp 2009 bailout dollar cost 2,000 years from now?

Production also speaks to the relative value, Bonner writes. Gold is scarce and must be unearthed. The scarcity makes it valuable. Paper money, however, is being printed like crazy to “save America.” Worldwide, American dollars have lots of competition, too. There is no scarcity of paper money since the invention of the printing press. Compared with finding gold and the costs of unearthing it, the cost of printing money is negligible. It doesn’t cost much to increase the money supply as President Obama has done, either. Adding zeroes does not create added value, Bonner asserts.

Fiat cars and money lose value

Most paper currencies are ruined within a few years. Some take longer, but even the world’s two most successful – the American dollar and the British pound – have lost over 95 percent of their value in the last century by Bonner’s count. Two events in American history – when President Franklin Roosevelt outlawed private gold ownership in 1933 and when President Richard Nixon severed U.S. ties to the Bretton Woods System in 1971 – sounded the death knell for the dollar’s true value. It had been tied to value in terms of real commodities before, namely gold. Now dollars are fiat money. They lose value FAST, which is not something we need – particularly now.

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When Warren Buffett talks, everybody listens.

Bloomberg’s Erik Holm reports that billionaire Buffet of Berkshire Hathaway has proclaimed that America’s economy has “fallen off a cliff,” and that President Obama’s recent efforts at recovery may lead to monetary inflation higher than in the 1970s. Some inflation is acceptable and very normal when billions are infused into the money supply by the Treasury, but too much will hurt… too much.

“The economy can’t turn around on a dime,” Buffett said on a recent CNBC television broadcast. People are afraid and have changed the way they spend their money. Buffett recognizes that what he calls a recession (others say depression) will end and “future generations will live better than their parents.”

Bears eat profits

The bear market’s impact upon Berkshire Hathaway has been tremendous – shares have lost nearly half their value and the recession has put pressure on its affiliated companies to produce enough profit to fill in the gap. Several Berkshire holding companies are “just getting killed,” he said. Berkshire’s fourth-quarter net income fell 96 percent to $117 million, the firm said Feb. 28. Book value per share for 2008 was the worst performance under Buffett.

No more game-playing, please

While bailouts were necessary for the banking system and high-profile insurers like AIG, the scope of the damage goes beyond balloon bailout payments. Buffett said he doesn’t see “any moral hazard in the U.S. seizing an institution when shareholders are already almost wiped out.” So perhaps the march toward socialization of the banking system isn’t as far away as we’ve been lead to believe.

In reference to special investment schemes too many companies used to inflate profits, Buffett said that “corporate America has a lot of room to behave better.” Furthermore, the rich do not need tax cuts. Buffett also said – perhaps covering some of his own working habits – that CEO’s “shouldn’t be demonized” for using corporate jets that “help them be more efficient.”

I beg to differ with you, sir. Technology to host virtual meetings exists, and I’m sure it’s cheaper than jet fuel and maintenance. Keep that money and avoid having to lay off employees if you have any conscience at all. With jobs, they’re eligible for payday loans if they need them.

Even Buffett’s guilty

But even the Wizard of Omaha makes mistakes. Berkshire has committed to a $3 billion investment in Dow Chemical Co., which Dow will use to acquire Rohm & Haas Co. Considering the performance hit Dow and Rohm & Haas have taken, it’s no longer the “attractive deal” it once was.

“Our commitment, which looked smart at the time, looks dumb now,” he said.

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These days, it feels like more money is going down the toilet and people are crying out for short term loans to fill the gaping hole in their balance sheets. Critics of of President Obama’s economic stimulus package worry that the money is not going to be used in the right way, while others are concerned that the massive infusion of money into the money supply will create rampant inflation (if we haven’t already been there for a while). Did you hear about the hyperinflation in Zimbabwe? Folks there may as well flush those paper zims down the toilet.

But sometimes, people who don’t mean to flush money down the toilet end up doing just that.

Sealed for freshness

Dave Graham reports for Reuters that a German businessman lost his euros in a public toilet. He had more than 10,000 euros (which translates into about $13,000 American) in a clear plastic bag. Why did he carry that much money with him into a public restroom and why was the money zipped up in a plastic bag? Is there a kidnapping/contraband/blackmail story here that we should know about? Anybody who “discovered” the money in that restroom after the man’s departure may have needed bad credit short term loans for their emergency cash needs before, but not now…

Oh no! I “lost” my money!

State police said the man had stopped to relieve himself in a motorway service station near Haiger in western Germany. After cleanup and inspection, he returned to his vehicle and left the scene.

Since the question wouldn’t ask itself (no matter how much it wanted to), a spokesman for the investigating police form pondered why the businessman took half an hour before he “noticed” that his money was gone. Don’t be like this guy; when you know a cashflow problem is coming that you must solve quickly, short term loans are the way to go. Don’t flush time (or money) down the toilet.

Related articles

• German teen takes a nap – on an expressway (canada.com)
• Is the Fed Hurting the Dollar in the Long-Term? (citizeneconomists.com)
• Printed money, Gloom to Doom (sunilmalhotra.wordpress.com)

Why do people look for a payday loan now and then? It’s not just because it’s a fast, convenient and discreet way to obtain emergency cash. The simple fact is that the cost of living has made it difficult for many American families to stretch their budgets to cover surprise situations. And according to a recent Belleville News-Democrat editorial by Holly Sklar, it’s only gotten worse since 1973.

Yes, the rich get richer…

A glaring example of the workplace divide is what Merrill Lynch did while scores of workers were losing their jobs. Amidst the wreckage and broken dreams, Merrill Lynch paid a small group of employees (around 700) more than $1 million apiece in 2008 bonuses. This added up to $3.6 billion – all of it handed out while the company lost $27 billion.

Since 1973, workers have lost ground in the salary department. Adjusting for inflation, the average full-time workers made $41,198 in 1973 and $37,606 in 2008. CEOs, in the meantime, made 45 times more than workers in 1973. Today, that gap has widened to 300 times more. The tax rate for the top income groups has gone down from 70 to 35 percent, and capital gains tax has gone down from 36.5 percent to 15. This has played a large part in the current disproportionate distribution of wealth. So much so that people in the top income bracket may not even have to think about the aid a payday loan provides.

Brother, can you spare a few hundred thousand dimes?

Sklar bottom-lines it for us. She shares the latest IRS info regarding annual income for the top 400 taxpayers. The average adjusted gross income was $263 million each in 2006 (that’s more than $5 million per week), which was up from $221 million in 2005 and $67 million in 1992, all figures adjusted for inflation.

A lot of people are happy about President Obama’s plan to cap CEO pay at $500,000 for senior executives, but this will only apply to bailed out companies. Furthermore, various loopholes in the plan limit its effectiveness, according to Sklar. Cash Advance Mojo likes the idea Netflix CEO Reed Hastings had about a 50 percent income tax for CEOs who earn above $1 million.

Say you want a revolution

Here’s Sklars conclusion regarding this inequity. See what you think:

If we don’t start taxing the wealthy more now, then you can be sure that the mountain of debt created by tax cuts and the bailout will be used to drive “entitlement reform.” Workers’ last forms of security – Social Security and Medicare – will be on the chopping block to pay for the wreck the truly entitled made of our economy.

A payday loan can help a consumer absorb the shocks between their ever-shrinking paychecks. But a long-term solution to America’s disappearing middle class is needed. If the rich are not willing to submit to greater taxation and try to hide behind loopholes and shelters, they should be tracked down and forced to submit. For their own good and the good of all.

Related articles

• How Will Obama’s Tax Plan Affect Self Employed Americans? (internetbiztaxtips.com)
• Obama’s Old Solutions for a New Economy (spot-on.com)

United Stated Federal Reserve Chairman Ben Bernanke

Your online payday loan store keeps you informed about the nation’s financial crisis.

The Federal Reserve recently has changed its focus from interest rates to emergency credit programs. Today it announced it is ready to start buying Treasury securities in order to resuscitate lending. The federal interest rate last month was dropped to nearly zero, and for the time being the powers that be intend to keep it that way. Now the organization turns its attention to improving conditions in private credit markets by buying long-term Treasuries.

The Fed also warned that the nation is facing the threat of inflation falling too low. Some economists are concerned that  a long recession could even result in deflation. Check out this article from your online payday loan lender to read about the causes and effects of deflation.

Market stimulation

Thought the Fed has said it is prepared to buy Treasury securities, it has stopped short of saying that it will actually begin the process. Any purchases made between now and the Federal Open Market Committee’s next meeting must be put to a vote. The FOMC meets next in March.

While the Fed’s focus on emergency credit programs is lessening panic in the markets right now, it does not promote growth. As long as the federal interest rate stays so close to zero the markets will not experience growth.

Not enough inflation

Economists predict that inflation will go up only 0.78 percent this year, which is about a point below the normal level. Regular inflation fosters economic growth and helps keep prices stable. Without inflation, the gross domestic product will continue to decrease or stay stagnant, and the recession will continue.

Some economists are still concerned about the threat of deflation, which will cause more business closings and job losses. The only real defense against deflation is consumer spending. The theory is that if financial institutions resume normal lending, consumers will resume a level of spending that is closer to normal.

So what do you think? After the country’s recent financial hardships, will consumers go back to their old ways of borrowing and spending? You can leave your comments here, on your online payday loan source.

Payday loans at the very least will be spent repairing cracked drywall in Charleston South Carolina. Residents there were reminded of times past in Charleston, SC when the earthquake hit at 7:42 Tuesday Morning (December 16). The earthquake was fairly weak measuring only 3.6 on the Richter scale. No fatalities or injuries were reported but it left residents rattled.

The quake, which occurred about 10 miles east of Summerville was a sobering reminder of the Charleston earthquake of of 1886 which was in the same area.

The 1886 quake killed more than 100 people, and left $5million in property damage. Adjusting the cost for today’s inflation would bring the cost to $103 million. The quake of 1886 measured a whopping 7.3 on the Richter scale.

Prophetic Planning

Tuesday Mornings event were a subtle reminder of 1886

Ironically, Bill Lewis,the supervisor for Charleston County School District had previously put the school board on notice that he was ready to invest district money to fix county schools in preparation for earthquakes. The schools targeted were Buist, Fraser, Memminger and James Simmons.

Lewis is hoping to use stimulus money if possible but he says he will borrow payday loans if he has to. With the latest events, surely which ever opponents he had on the plan are in full agreement with him now as the question in every ones mind is whether or not the small Tuesday morning quake was a warning sign of things to come.

South Carolina’s Shaky History

The irony of Tuesday’s mornings 3.6 quake is reminiscent of the quake which preceded the devastating 1886 quake.

It was perceived to be just a tremor but quickly became a rolling thunder as shock waves lasted for 35 to 40 seconds. 8 minutes later came the first aftershock which was damaging its self before six more aftershocks followed within the next twenty four hours time period.

Almost every building in the city was destroyed as well as 14,000 houses in Charleston. Damage was experienced by by buildings within a 160 kilometer radius and affected over 5 million square kilometers. It was reported that thirty states felt the biggest tremor that peaked at an estimated 10.0 although officially it has been recorded as a 7.3.

More marks on SC time line

• South Carolina was struck again on January 23rd of 1903 with what was estimated to be a 5.0 in magnitude. This quake occurred along the Georgia border and near Savannah.
• Savannah was rattled again in April of 1907 with a category seven quake which was felt by Charleston as a category six. This shock was felt around an area of 90,000 square kilometers.
• 1913 came after Union County with 6 to 7 magnitude quake felt by an area of 111,000 miles.
• Summerville in 1914 was hit by a category five quake which was reportedly preceded by what residents said sounded like a train approaching from a distance. Surely an eerie experience that was felt by 78,000 square kilometers.
• In October of 1924 a category five struck Pickens county affecting most of South and North Carolina.
• July of 1945 another category five quake hit Lake Murray.
• Smaller shocks hit near Charleston in November of 1952, August 1959, March 1960, July,1960, and October 1967.

Including the Tuesday morning events, that about raps up South Carolina’s shaky past. Residents of South Carolina may be needing payday loans to repair their homes if things rattle to new heights.

For the folks of South Carolina, keep a careful ear for the train and dart for the old sturdy oak kitchen table if you hear one! And for payday loans to repair it!

It’s inevitable. We are all going to have to retire someday, hopefully by choice and not by illness and prayerfully we will have the necessary funds to do so – after all, you can’t rely on Social Security and payday loans alone for your retirement.

You may have heard that the age in which people are retiring is rising. Now this could be because work is so much more fun than it used to be, or perhaps advances in medical technology is allowing us to spend a couple extra years behind our work desks, maybe we have to work the extra years just to assure ourselves that our retirement will last until we retire from existence.

Is your money not worth what it you used to be? Thank inflation, the silent thief.

The answer is leaning towards the latter. We can stretch out our working careers through a healthy lifestyle and improve our wages at retirement through smart investing but one thing many of us don’t pay enough attention to is the rate of inflation.

What is inflation?

“Inflation is a rise in the general level of prices of goods and services in an economy over a period of time.”

The basic idea of inflation is this, you remember when a candy bar cost you 10 cents, well now that same candy bar will cost you close to a dollar if not more in some places. There was a time that many remember when a single income could provide for a whole household. Today it takes two incomes to provide for a household yet the assets maintained are not any more than they were six decades ago. Inflation rises at about two to three percent a year making a subtle impact on your finances that goes unnoticed by most people until they wake up one day and say “  I remember when a gallon of milk cost under $1″, and when hardly anyone had to get payday loans.

Unfortunately, Americas wages are not keeping up with the rate of inflation which means that each year your buying power is decreasing. If you make a $60k salary and inflation continues at the current rate of inflation which is 3%, you will need to be making $80K ten years from now just to maintain the same buying power that you have currently. The chart below was found on bankrate.com’s website and will give you a good idea of what your future earnings should be over the next few decades to keep pace with inflation.

What will you need to be making?

If you would like to play around with these figures a little more you can use the retirement calculator found at Bankrate.com.

It is astonishing to think that a $50K dollar salary will need to be at least $121K in thirty years. Not only do we need to save for retirement, we also need to make sure that our funds last through our retirement years.

Planning conservatively for our financial future is more important today than ever before. For those of us born after the baby boomers, we also have the added pressure that we may never receive our rightful dues from the Social Security System. Our future financial security depends largely upon our ability to invest successfully today, and not solely on payday loans for our financial security – we can’t anyway.

If you haven’t yet started an investment portfolio, the sooner you do so, the better off you will be. With the slumping economy it may seem to be a scary time to invest but then again, where there is crisis there is always opportunity. Now may be the perfect time to make up lost ground.