During a news conference yesterday, President Bush said that the country was not recession bound. It appears that everything is going to be okay, and we all can sleep better at night without fear of the scary recession monster.
I don’t know about you, but I’m just not getting that warm and fuzzy feeling. If you believe President Bush, and you feel good about the country’s economic future, then more power to you. I just don’t think I’m ready to drink that Kool-Aid quite yet.
I look at the economy and I still see major issues. Mr. Bush says that the economic stimulus package will be more than enough to fix what ails us, but I look at it and think “what a waste of tax payer money.” Of that $168 billion how much will actually end up back in the economy? 1/2? 1/3 or less? No one can know for certain, but I have a feeling it will not be nearly as much as the Bush clan is projecting.
What I do know is that inflation is running rampant, and it appears that the Fed isn’t going to do anything to slow it down for awhile. Even if Bush and Bernanke pull out all the stops to ward off recession, with what will we ultimately be left? Recession is a natural thing, it happens every once in awhile, and whether or not we want to, we are going to have to face it eventually. If we keep delaying it and delaying it, once it eventually comes it will only come harder. It would be great if we could avoid recession forever, but that only happens in Fantasy Land, and it is high time for President Bush and Bernanke to come back to reality. I know Bush is just trying to delay the recession until after the elections, but come on, man... your legacy is already ruined, and you’re only making it worse.
Meanwhile, investment-wise it pretty much comes down to this: If you believe that Bush and Bernanke have this thing under control, then you want to buy up dollar assets. If you don’t believe Bush and Bernanke are going to pull off a miracle, and are just setting us up for a harder fall, then you want to get out of the dollar.
Friday, February 29, 2008
Thursday, February 28, 2008
Consequences Of Inflation: Nonsense Says Bernanke
Federal Reserve chairman Ben Bernanke has shown once again that he could care less about the consequences of inflation. In his latest address, Bernanke made it pretty clear that at the next Fed meeting (March 18th) he is planning to lower interest rates once again. Did he not get all the reports that were released this month about ramped inflation, or does he just not care?
Every month it seems inflation is getting worse and worse, and the economy despite all the rate cuts, is continuing its downward spiral. Newsflash to Bernanke: The rate cut thing isn’t working. Well, it is certainly working to increase inflation, and devalue the dollar, but it isn’t helping the economy like he hoped. Rather than admit defeat, Bernanke is making what he must think is a valiant stand, but rather than glory all he is likely to see is stagflation and a bunch of ticked-off retired folks.
To all of the retirees out there, I offer you my sincerest apologies. It appears that your retirement money is not going to go as far as you probably planned. You can thank Alan Greenspan, and now Bernanke for that little favor. I wonder how many parents are going to have to move in with their children because they can no longer afford retirement? It would be an interesting irony considering how children are now moving out later and later in life. To all of the entrepreneurs out there, can I suggest starting a business catering to in-law additions or design? Just an idea I thought I’d share to help fill a need in this soon to be emerging market, compliments of Mr. Bernanke of course.
If you have yet to retire, hopefully you have enough time to conquer this inflation problem within your retirement portfolio. My suggestions are to diversify out of the dollar and make sure that you have exposure to gold and silver. Gold makes me nervous right now, seeing how high its price has gone, but at this point I would feel much better owning gold than dollars. Whatever you choose to invest in, make sure that you are taking inflation into account in your retirement need projections, and you had better be expecting more than 2 or 3 percent.
Every month it seems inflation is getting worse and worse, and the economy despite all the rate cuts, is continuing its downward spiral. Newsflash to Bernanke: The rate cut thing isn’t working. Well, it is certainly working to increase inflation, and devalue the dollar, but it isn’t helping the economy like he hoped. Rather than admit defeat, Bernanke is making what he must think is a valiant stand, but rather than glory all he is likely to see is stagflation and a bunch of ticked-off retired folks.
To all of the retirees out there, I offer you my sincerest apologies. It appears that your retirement money is not going to go as far as you probably planned. You can thank Alan Greenspan, and now Bernanke for that little favor. I wonder how many parents are going to have to move in with their children because they can no longer afford retirement? It would be an interesting irony considering how children are now moving out later and later in life. To all of the entrepreneurs out there, can I suggest starting a business catering to in-law additions or design? Just an idea I thought I’d share to help fill a need in this soon to be emerging market, compliments of Mr. Bernanke of course.
If you have yet to retire, hopefully you have enough time to conquer this inflation problem within your retirement portfolio. My suggestions are to diversify out of the dollar and make sure that you have exposure to gold and silver. Gold makes me nervous right now, seeing how high its price has gone, but at this point I would feel much better owning gold than dollars. Whatever you choose to invest in, make sure that you are taking inflation into account in your retirement need projections, and you had better be expecting more than 2 or 3 percent.
Wednesday, February 27, 2008
Foreclosures Increased 57 Percent In The Past Year
Foreclosure filings increased 57 percent from January 2007 to January 2008, according to a report released yesterday by RealtyTrac. Some states were hit by foreclosure much harder than others.
Nevada, despite actually experiencing a decrease in foreclosure activity between December 2007 and January 2008, was the state with the highest rate of foreclosures in the nation in January 2008. 6,087 properties in Nevada faced foreclosure filings in January 2008, according to the report.
And from January 2007 to January 2008, Nevada's foreclosure activity increased by 95 percent, according to the report.
"California’s January foreclosure rate ranked second highest among the states, and Florida’s January foreclosure rate ranked third highest. Other states with foreclosure rates ranking among the top 10 were Arizona, Colorado, Massachusetts, Georgia, Connecticut, Ohio and Michigan," according to the report.
Florida, Arizona, Georgia and Colorado each had individual markets that were ranked in NuWire's Top 10 Foreclosure Markets for 2007.
California had the second-highest rate of foreclosure filings, but the highest number of actual foreclosure filings, coming in at a total of 57,158 properties, according to the report. California had a 120 percent increase in foreclosure activity from January 2007 to January 2008.
Florida had the second highest total number of foreclosure filings, at 30,178 properties, and a 158 percent increase in foreclosure activity from January 2007 to January 2008, according to the report. "The Cape Coral-Fort Myers, Fla., metro area documented the highest January foreclosure rate among the 229 metro areas tracked," according to the report.
What does this mean for investors? For those who are interested in potentially getting great deals on properties, it means that opportunities abound. Investing in foreclosure properties was number three on NuWire's list of 2007's Top 10 Investments Under $25,000.
For more information on investing in foreclosures, see our previous articles Capitalizing on Record Foreclosures and Buying HUD Foreclosures: What Investors Should Know.
And if there are any investors who want to go all out when purchasing a foreclosure, they should keep their eyes on the headlines. Michael Jackson's infamous Neverland Ranch is set to be auctioned off unless he can come up with $24.5 million by March 19. For more details, see Eric's previous post Michael Jackson Facing Foreclosure: What's Next For Neverland Ranch?
This was a guest post from Trista Winnie, Associate Editor at NuWire. If you like what you read here you should check out CommonCensus, a blog where Trista contributes regularly.
Nevada, despite actually experiencing a decrease in foreclosure activity between December 2007 and January 2008, was the state with the highest rate of foreclosures in the nation in January 2008. 6,087 properties in Nevada faced foreclosure filings in January 2008, according to the report.
And from January 2007 to January 2008, Nevada's foreclosure activity increased by 95 percent, according to the report.
"California’s January foreclosure rate ranked second highest among the states, and Florida’s January foreclosure rate ranked third highest. Other states with foreclosure rates ranking among the top 10 were Arizona, Colorado, Massachusetts, Georgia, Connecticut, Ohio and Michigan," according to the report.
Florida, Arizona, Georgia and Colorado each had individual markets that were ranked in NuWire's Top 10 Foreclosure Markets for 2007.
California had the second-highest rate of foreclosure filings, but the highest number of actual foreclosure filings, coming in at a total of 57,158 properties, according to the report. California had a 120 percent increase in foreclosure activity from January 2007 to January 2008.
Florida had the second highest total number of foreclosure filings, at 30,178 properties, and a 158 percent increase in foreclosure activity from January 2007 to January 2008, according to the report. "The Cape Coral-Fort Myers, Fla., metro area documented the highest January foreclosure rate among the 229 metro areas tracked," according to the report.
What does this mean for investors? For those who are interested in potentially getting great deals on properties, it means that opportunities abound. Investing in foreclosure properties was number three on NuWire's list of 2007's Top 10 Investments Under $25,000.
For more information on investing in foreclosures, see our previous articles Capitalizing on Record Foreclosures and Buying HUD Foreclosures: What Investors Should Know.
And if there are any investors who want to go all out when purchasing a foreclosure, they should keep their eyes on the headlines. Michael Jackson's infamous Neverland Ranch is set to be auctioned off unless he can come up with $24.5 million by March 19. For more details, see Eric's previous post Michael Jackson Facing Foreclosure: What's Next For Neverland Ranch?
This was a guest post from Trista Winnie, Associate Editor at NuWire. If you like what you read here you should check out CommonCensus, a blog where Trista contributes regularly.
Michael Jackson Facing Foreclosure: What’s Next For Neverland Ranch?
That’s right, not even Michael Jackson, “The King of Pop,” can distance himself from the foreclosure problems facing the country. According to the Associated Press, Michael Jackson will need to come up with $24.5 million by March 19 in order to save his famed Neverland Ranch from being auctioned off.
The starting bid amount will likely exceed $24.5 million, but considering the fame of Neverland ranch and the location outside Santa Barbara California, it might not be a bad investment. I imagine that this ranch could be turned into quite the tourist draw. Michael Jackson is still probably the biggest single name in music worldwide, and people will want to see his famed ranch. Just think of the tourist draw that Graceland has become. Not only is Michael Jackson a bigger name than Elvis, but the property is much more interesting than Graceland. People will pay money to see Neverland. Of that I’m sure. Even people who aren’t Michael Jackson fans would probably still pay to see the ranch just out of curiosity.
The main buildings could be turned into a museum, and much of the rest of the ranch subdivided and sold off, turned into a vineyard (Neverland winery could be an interesting novelty...), or any number of things depending on the investor’s preferences. Seeing as homes in that region, on just a couple acres, are going for $1-5 million a piece, and Neverland ranch is on somewhere between 2,500-2,900 acres (depending on which source you believe), there is substantial value in the land for sure.
That being said I’m not sure if the property will even make it to auction. It is likely that Jackson will figure some way out of this problem, but it is interesting to consider. Who knows? Maybe the next time that I’m in Santa Barbara, I’ll be able to take a full access tour of Neverland ranch, and maybe even a ride on Michael Jackson’s Ferris Wheel.
The starting bid amount will likely exceed $24.5 million, but considering the fame of Neverland ranch and the location outside Santa Barbara California, it might not be a bad investment. I imagine that this ranch could be turned into quite the tourist draw. Michael Jackson is still probably the biggest single name in music worldwide, and people will want to see his famed ranch. Just think of the tourist draw that Graceland has become. Not only is Michael Jackson a bigger name than Elvis, but the property is much more interesting than Graceland. People will pay money to see Neverland. Of that I’m sure. Even people who aren’t Michael Jackson fans would probably still pay to see the ranch just out of curiosity.
The main buildings could be turned into a museum, and much of the rest of the ranch subdivided and sold off, turned into a vineyard (Neverland winery could be an interesting novelty...), or any number of things depending on the investor’s preferences. Seeing as homes in that region, on just a couple acres, are going for $1-5 million a piece, and Neverland ranch is on somewhere between 2,500-2,900 acres (depending on which source you believe), there is substantial value in the land for sure.
That being said I’m not sure if the property will even make it to auction. It is likely that Jackson will figure some way out of this problem, but it is interesting to consider. Who knows? Maybe the next time that I’m in Santa Barbara, I’ll be able to take a full access tour of Neverland ranch, and maybe even a ride on Michael Jackson’s Ferris Wheel.
Barack Obama Is Taking Shots From The Left And The Right
Barack Obama is getting attacked from all sides now, and it appears that no place is safe for him. On the left he is being attacked by Hillary Clinton, with accusations of plagiarism among other things. On the right he is being bombarded by supporters of John McCain, who are setting him up as a supporter of terrorists. I sincerely feel bad for the guy right now.
I’m not a big supporter of Obama, but I’m also not a supporter of low blows (I don’t support Obama because of his huge spending proposals and other polices, not personal issues). The latest blow coming from McCain supporters at a recent rally was especially distasteful. There the speaker who introduced Obama repeatedly called out his full name Barack Hussein Obama, and suggested that he was being friendly with our terrorist enemies. I was upset with Clinton’s plagiarism accusations, but this is 100 times worse. It would be one thing if they had proof that he is working with terrorists. But to accuse him of what amounts to treason just because the guy was born into a Muslim family (although it is debated whether they were even practicing) and has the middle name Hussein...give me a break. Not that religion even matters, but they guy is a renowned Christian now, not Muslim. All this does is make the McCain campaign look like an ignorant bunch of bigots, which is not exactly the image one wants to portray in a campaign.
To his credit, McCain did repeatedly apologize for the remarks made by his supporters, and he said that he expects that it won’t happen again. I certainly hope that is the case.
In every election, things eventually turn nasty, and it has been one of the biggest turn-offs to me for politics. For once, I would like to see the candidates fight a nice, clean fight and stick to the issues. If you have a problem with a candidate’s proposals...great, let’s debate them. Topics involving religion, race, and family...lets keep those out of it. Here’s hoping for a good clean Presidential race, whichever candidates it may involve.
I’m not a big supporter of Obama, but I’m also not a supporter of low blows (I don’t support Obama because of his huge spending proposals and other polices, not personal issues). The latest blow coming from McCain supporters at a recent rally was especially distasteful. There the speaker who introduced Obama repeatedly called out his full name Barack Hussein Obama, and suggested that he was being friendly with our terrorist enemies. I was upset with Clinton’s plagiarism accusations, but this is 100 times worse. It would be one thing if they had proof that he is working with terrorists. But to accuse him of what amounts to treason just because the guy was born into a Muslim family (although it is debated whether they were even practicing) and has the middle name Hussein...give me a break. Not that religion even matters, but they guy is a renowned Christian now, not Muslim. All this does is make the McCain campaign look like an ignorant bunch of bigots, which is not exactly the image one wants to portray in a campaign.
To his credit, McCain did repeatedly apologize for the remarks made by his supporters, and he said that he expects that it won’t happen again. I certainly hope that is the case.
In every election, things eventually turn nasty, and it has been one of the biggest turn-offs to me for politics. For once, I would like to see the candidates fight a nice, clean fight and stick to the issues. If you have a problem with a candidate’s proposals...great, let’s debate them. Topics involving religion, race, and family...lets keep those out of it. Here’s hoping for a good clean Presidential race, whichever candidates it may involve.
Tuesday, February 26, 2008
Foreign Investment Property: Where Are The Highest Yields?
Many of our readers are interested in purchasing foreign investment property for various reasons. Some want to purchase foreign investment property as a vacation retreat, while others look at foreign property strictly as an investment and an alternative to U.S. real estate. If you are looking at vacation spots, then you should be concerned with more than the yield of a property. However, if you are buying foreign property solely as an investment, then yields will be one of the most important factors of the property you decide to buy.
Global Property Guide has published a list of the top 10 highest yielding foreign markets which might help you in your search for that perfect location. They identified the top 10 highest yielding foreign markets as: Egypt, Indonesia, Philippines, Panama, Ukraine, UAE, Jordan, China, South Africa, and Morocco.
Before you get too excited, consider that these figures are only based on highest yield. The rankings do not take into account the risks, taxes and fees associated with buying, selling and owning property in the country. One needs to analyze and account for these things before one buys property in a foreign country. Global Property Guide covers many different countries and offers additional information, including tax rates. They are a great place to start your research for foreign investment property.
Global Property Guide has published a list of the top 10 highest yielding foreign markets which might help you in your search for that perfect location. They identified the top 10 highest yielding foreign markets as: Egypt, Indonesia, Philippines, Panama, Ukraine, UAE, Jordan, China, South Africa, and Morocco.
Before you get too excited, consider that these figures are only based on highest yield. The rankings do not take into account the risks, taxes and fees associated with buying, selling and owning property in the country. One needs to analyze and account for these things before one buys property in a foreign country. Global Property Guide covers many different countries and offers additional information, including tax rates. They are a great place to start your research for foreign investment property.
Has The Housing Bubble Bottomed Out?
It seems that many would-be real estate investors across the country are on the sidelines waiting to hear the words, “the housing bubble has bottomed out” and “now is the time to get back into real estate investment.”
Forbes just published an article titled, “Surprise! Home Sales Spark Hope” citing recent data issued by the National Association of Realtors (NAR) which has sparked a bit of optimism from investors. The funny thing is that the data wasn’t good news at all. The report showed that single-family home and condo sales dropped by .4 percent in January and sales are now at the slowest pace on record since 1999. Coupled with the looming increases in the conforming loan limits, this news has sparked hope that the bubble has officially bottomed out.
I’m not ready to agree, but I will say that there is still money to be made in real estate right now. While the real estate market is generally reported in national terms, it is still a local market. Nationally, real estate has been declining, but that doesn’t mean that it is declining everywhere. Portland real estate and Charlotte real estate have been performing fairly well overall.
There is another important point to remember: Good investors make their money when they buy the property. I know that phrase might seem overused, but it is true. Anytime you buy a piece of real estate, you should know in advance what your plan for the property is (exit strategies), and how much you can afford to pay for it and still make the profit you expect. No investor should ever add appreciation into their expectations, especially if it isn’t going to be a long term investment. In my opinion, the best exit strategy—though it isn’t really even an exit strategy—is to keep the property for the rest of your life, and then let your kids worry about what they are going to do with it when you pass on.
Investors should remember that cash flow is king (another cliché...sorry). In a tough market, properties that have built-in cash flow are sure to better retain their values than properties that don’t. Investors who own cash flow properties don’t have to worry about how they are going to make their next mortgage payment; the property takes care of itself. Cash flow property isn’t going to make you an overnight millionaire, like people who were buying up Las Vegas real estate a few years back, but neither will it cost you. Buying cash flow property and holding it for the long haul is a tried and true way to build wealth. It has been, and always will be so.
Forbes just published an article titled, “Surprise! Home Sales Spark Hope” citing recent data issued by the National Association of Realtors (NAR) which has sparked a bit of optimism from investors. The funny thing is that the data wasn’t good news at all. The report showed that single-family home and condo sales dropped by .4 percent in January and sales are now at the slowest pace on record since 1999. Coupled with the looming increases in the conforming loan limits, this news has sparked hope that the bubble has officially bottomed out.
I’m not ready to agree, but I will say that there is still money to be made in real estate right now. While the real estate market is generally reported in national terms, it is still a local market. Nationally, real estate has been declining, but that doesn’t mean that it is declining everywhere. Portland real estate and Charlotte real estate have been performing fairly well overall.
There is another important point to remember: Good investors make their money when they buy the property. I know that phrase might seem overused, but it is true. Anytime you buy a piece of real estate, you should know in advance what your plan for the property is (exit strategies), and how much you can afford to pay for it and still make the profit you expect. No investor should ever add appreciation into their expectations, especially if it isn’t going to be a long term investment. In my opinion, the best exit strategy—though it isn’t really even an exit strategy—is to keep the property for the rest of your life, and then let your kids worry about what they are going to do with it when you pass on.
Investors should remember that cash flow is king (another cliché...sorry). In a tough market, properties that have built-in cash flow are sure to better retain their values than properties that don’t. Investors who own cash flow properties don’t have to worry about how they are going to make their next mortgage payment; the property takes care of itself. Cash flow property isn’t going to make you an overnight millionaire, like people who were buying up Las Vegas real estate a few years back, but neither will it cost you. Buying cash flow property and holding it for the long haul is a tried and true way to build wealth. It has been, and always will be so.
Monday, February 25, 2008
As The Price Of Gold Rises, What Is An Oscar Worth?
With the price of gold sky high right now, how valuable are those Oscars that got passed out yesterday?
According to The Seattle Times, each Oscar Statuette cost $500 this year, up from $400 last year. In only one year the price jumped $100, or 25 percent! That is pretty amazing, and it goes to show how bad inflation is getting, especially for materials. Each Oscar, according to The Seattle Times, is made from pewter that is plated in successive layers of copper, nickel, silver and gold, and then lacquered and buffed. The price of gold itself has jumped around 40 percent in the last year.
Those who think that $500 isn’t much to pay for an Oscar might be disappointed to know that they can’t be bought. There are strict rules forbidding their sales, and Oscar winners sign contracts guaranteeing that they won’t sell their own award. If they were to break that contract, they would probably fetch more than $500 on the black market, but instead of investing in Oscars, one might want to consider the materials that make up an Oscar.
Even though it seems that silver and gold are at ridiculous highs right now, I think there is more room to grow. Considering the rate at which the Fed is inflating the monetary supply, gold and silver are practically a must for investors right now.
According to The Seattle Times, each Oscar Statuette cost $500 this year, up from $400 last year. In only one year the price jumped $100, or 25 percent! That is pretty amazing, and it goes to show how bad inflation is getting, especially for materials. Each Oscar, according to The Seattle Times, is made from pewter that is plated in successive layers of copper, nickel, silver and gold, and then lacquered and buffed. The price of gold itself has jumped around 40 percent in the last year.
Those who think that $500 isn’t much to pay for an Oscar might be disappointed to know that they can’t be bought. There are strict rules forbidding their sales, and Oscar winners sign contracts guaranteeing that they won’t sell their own award. If they were to break that contract, they would probably fetch more than $500 on the black market, but instead of investing in Oscars, one might want to consider the materials that make up an Oscar.
Even though it seems that silver and gold are at ridiculous highs right now, I think there is more room to grow. Considering the rate at which the Fed is inflating the monetary supply, gold and silver are practically a must for investors right now.
Ever Dream Of Being Part Of An Oscar Winning Film?
Watching the Oscars, one can’t help dreaming about being involved in the film industry. Unfortunately for most of us, we have little to no acting ability and no chance of ever getting a role in a feature film. But there is still one way to get your name up on the big screen, investing in films. Aspiring independent (also known as indie) film directors are always on the look out for investors.
It may not be the best investment out there in terms of returns, but investing in films brings something more than just monetary reward. If one has dreamed about having one’s name on the big screen and has money to gamble, then why not? The odds are still better than Vegas, and even if the film is a bust one will always be able to see one’s name in the credits of a real movie (assuming the film gets completed of course).
There are surprisingly a lot of opportunities out there to invest in indie films, and many different ways to do so. Last week, NuWire published an article about investing in indie films, and if you have always had the dream of being part of a feature film, and maybe even an Oscar winning one at that, it is certainly worth reading.
It may not be the best investment out there in terms of returns, but investing in films brings something more than just monetary reward. If one has dreamed about having one’s name on the big screen and has money to gamble, then why not? The odds are still better than Vegas, and even if the film is a bust one will always be able to see one’s name in the credits of a real movie (assuming the film gets completed of course).
There are surprisingly a lot of opportunities out there to invest in indie films, and many different ways to do so. Last week, NuWire published an article about investing in indie films, and if you have always had the dream of being part of a feature film, and maybe even an Oscar winning one at that, it is certainly worth reading.
Friday, February 22, 2008
Zimbabwe’s Inflation Tops 100,000 Percent
As the U.S. battles a serious inflation problem, we can at least be thankful it’s not as bad as the inflation issues Zimbabwe faces. Yesterday, Zimbabwe’s statistical office reported inflation of over 100,000 percent. That’s right, 100,000 percent; no extra zeros have been added for emphasis.
To give you an idea of what that type of inflation looks like, in Zimbabwe a simple loaf of bread costs around Z$3.5 million, according to VOA News. Can you imagine having to carry around 3.5 million dollars in cash just to buy a loaf of bread? As you have probably realized, this is not good for Zimbabwe’s economy; things have become truly disastrous there. Zimbabwe’s per capita GDP has shrunk from $200 in 1996 to around $9 now, according to CNN.
Unfortunately, a country that was on the rise has essentially been ruined by one man: Mr. Robert Mugabe. Since he won’t allow anyone to run against him in the elections, it doesn’t seem like he will be voted out anytime soon. The good news is that he is 84 years old, so he can’t last all that much longer. Castro resigned this week, so maybe Mugabe is the next dictator on his way out. Here’s hoping, anyway.
With the U.S. inflation rate at a little over 4 percent we don’t need to worry about problems of this scale, and I’m very thankful for that. But inflation in the U.S. is still a major problem. If people continue to overlook inflation, it will eventually eat their savings. Plan for inflation now, and invest accordingly. Ignore it, and your retirement could be in peril.
To give you an idea of what that type of inflation looks like, in Zimbabwe a simple loaf of bread costs around Z$3.5 million, according to VOA News. Can you imagine having to carry around 3.5 million dollars in cash just to buy a loaf of bread? As you have probably realized, this is not good for Zimbabwe’s economy; things have become truly disastrous there. Zimbabwe’s per capita GDP has shrunk from $200 in 1996 to around $9 now, according to CNN.
Unfortunately, a country that was on the rise has essentially been ruined by one man: Mr. Robert Mugabe. Since he won’t allow anyone to run against him in the elections, it doesn’t seem like he will be voted out anytime soon. The good news is that he is 84 years old, so he can’t last all that much longer. Castro resigned this week, so maybe Mugabe is the next dictator on his way out. Here’s hoping, anyway.
With the U.S. inflation rate at a little over 4 percent we don’t need to worry about problems of this scale, and I’m very thankful for that. But inflation in the U.S. is still a major problem. If people continue to overlook inflation, it will eventually eat their savings. Plan for inflation now, and invest accordingly. Ignore it, and your retirement could be in peril.
Investing in Portland Real Estate Isn’t A Bad Idea
Portland, Oregon real estate has weathered the subprime storm fairly well. While most of the country has been struggling with tumbling real estate prices, Portland real estate keeps moving along at a study pace.
Many people in Seattle seem to think of Portland as the little sister from the south, but Portland is becoming much more than that. In my opinion, Portland has surpassed Seattle in many aspects, with one of the biggest being transportation. Seattle, especially downtown, is dreadful to get around. Traffic is a mess, and other than busses, mass transit is non-existent. Seattle leadership keeps talking about an extended monorail system but years—and millions of dollars—later we are still waiting and wondering if it will ever happen.
On my last trip to Portland, I enjoyed their light rail system very much. I took it from the airport to the hotel and then later to the Rose Garden where I watched the Trailblazers play. There was no traffic to deal with, no cars, no cabs. That’s travel as it should be. The last time I watched the Sonics at Seattle’s Key Arena, I drove around for half an hour trying to find parking before coughing over $20 bucks. Portland seemed like a dream (and not only because their basketball team actually won the game).
That is just one aspect, and Portland has a lot more to offer. In my opinion, it is just as beautiful as Seattle, has better infrastructure, and is more affordable. It is quickly gaining a name for itself across the county, and should only continue to grow.
I wouldn’t say that Portland real estate is on fire, but the mere fact that it isn’t losing value puts it as one of the top cities for real estate in the country. The housing crisis isn’t over, and investors need not rush, but Portland real estate is certainly worth keeping an eye on.
Read our article for more information about Portland and investing in Portland real estate.
Many people in Seattle seem to think of Portland as the little sister from the south, but Portland is becoming much more than that. In my opinion, Portland has surpassed Seattle in many aspects, with one of the biggest being transportation. Seattle, especially downtown, is dreadful to get around. Traffic is a mess, and other than busses, mass transit is non-existent. Seattle leadership keeps talking about an extended monorail system but years—and millions of dollars—later we are still waiting and wondering if it will ever happen.
On my last trip to Portland, I enjoyed their light rail system very much. I took it from the airport to the hotel and then later to the Rose Garden where I watched the Trailblazers play. There was no traffic to deal with, no cars, no cabs. That’s travel as it should be. The last time I watched the Sonics at Seattle’s Key Arena, I drove around for half an hour trying to find parking before coughing over $20 bucks. Portland seemed like a dream (and not only because their basketball team actually won the game).
That is just one aspect, and Portland has a lot more to offer. In my opinion, it is just as beautiful as Seattle, has better infrastructure, and is more affordable. It is quickly gaining a name for itself across the county, and should only continue to grow.
I wouldn’t say that Portland real estate is on fire, but the mere fact that it isn’t losing value puts it as one of the top cities for real estate in the country. The housing crisis isn’t over, and investors need not rush, but Portland real estate is certainly worth keeping an eye on.
Read our article for more information about Portland and investing in Portland real estate.
Thursday, February 21, 2008
What Is Stagflation?
There is a lot of talk going around about stagflation, but many people have no idea what stagflation is. The term has only been around for about 40 years and is not used all that much, but suddenly it is being thrown around everywhere.
Stagflation is a blend of the words stagnation and inflation. It is used to describe an economy which is stagnating (or not growing) while also facing high inflation.
Typically, the Fed deals with economic stagnation by lowering key interest rates or adding to the money supply. These actions usually work to get the economy growing again.
On the flipside, when an economy is booming and people are making money left and right, inflation begins to rise. When this happens, the Fed typically raises interest rates thus making money harder to get. This slows the economy and inflation with it. So back to Stagflation…
In a period of stagflation, the Fed doesn’t know what to do. The economy is slow, so they want to lower interest rates and get it moving, but making money easier to get only makes inflation worse. The Fed has to decide what is more important: economic growth or inflation.
Right now, the U.S. economy is grinding to a halt, and very likely heading into a recession. Unfortunately we are also facing strong inflationary pressure as prices continue to rise (see inflation post). If we aren’t already in a period of stagflation, then it appears that we are headed straight for it. The last time the U.S. dealt with stagflation was in the 1970’s and it was not a fun experience.
Though the way we run are economy now is different than it was back then, some would argue that our current situation (housing and credit crisis) is far worse then the situation was in the 70’s leading up to that period of stagflation. I don’t know how bad it can get, but something worse than the 15 percent inflation and 9 percent unemployment seen during the past episode of stagflation doesn’t sound the least bit exciting to me. Personally, I will be heavily diversifying into foreign markets and things like gold and silver to protect myself, just in case.
Stagflation is a blend of the words stagnation and inflation. It is used to describe an economy which is stagnating (or not growing) while also facing high inflation.
Typically, the Fed deals with economic stagnation by lowering key interest rates or adding to the money supply. These actions usually work to get the economy growing again.
On the flipside, when an economy is booming and people are making money left and right, inflation begins to rise. When this happens, the Fed typically raises interest rates thus making money harder to get. This slows the economy and inflation with it. So back to Stagflation…
In a period of stagflation, the Fed doesn’t know what to do. The economy is slow, so they want to lower interest rates and get it moving, but making money easier to get only makes inflation worse. The Fed has to decide what is more important: economic growth or inflation.
Right now, the U.S. economy is grinding to a halt, and very likely heading into a recession. Unfortunately we are also facing strong inflationary pressure as prices continue to rise (see inflation post). If we aren’t already in a period of stagflation, then it appears that we are headed straight for it. The last time the U.S. dealt with stagflation was in the 1970’s and it was not a fun experience.
Though the way we run are economy now is different than it was back then, some would argue that our current situation (housing and credit crisis) is far worse then the situation was in the 70’s leading up to that period of stagflation. I don’t know how bad it can get, but something worse than the 15 percent inflation and 9 percent unemployment seen during the past episode of stagflation doesn’t sound the least bit exciting to me. Personally, I will be heavily diversifying into foreign markets and things like gold and silver to protect myself, just in case.
Nicaragua Featured In Sports Illustrated Swimsuit Photo Shoot
In another step towards Nicaragua’s world wide recognition as a travel destination, Nicaragua was one of the sites used for this year’s Sports Illustrated Swimsuit Edition. I believe two models had their shoots in San Juan Del Sur Nicaragua, one of main tourism destinations in the country. San Juan Del Sur is known for its great beach, fishing, and surfing. It also happens to be a growing destination for expatriates and real estate investors alike.
I’ve been to Nicaragua a few times and absolutely loved my time there. The people are extremely friendly, and the scenery is absolutely to die for. The people at Sports Illustrated obviously saw the beauty, and the rest of the world is slowly catching on to this as well. Seeing as the Sports Illustrated Swimsuit Edition is by far the largest selling issue for the company every year, millions more people are being introduced to not only beautiful models but a beautiful country.
Just out of curiosity, I looked around on some forums and blogs and it already appears that many people have taken notice and are asking about real estate opportunities in the country. Whether they follow through on that curiosity is another story, but any buzz is good for business in Nicaragua.
Those who are new to Nicaragua should check out the article we wrote about investing in Nicaragua real estate. Nicaragua also came in number 5 on our list of the top Latin American real estate markets. Any potential investors though should be warned that investing in Nicaragua is risky, and should be looked at as a long-term investment.
Those who have visited Nicaragua know that the country is beautiful, but needs a lot of work, especially in terms of infrastructure. There is a lot of development underway, but it is moving slowly. Most investors in Nicaragua are Americans, so investment in the country has slowed recently due to the problems in the U.S. Many investors are either choosing to wait, or were planning to use equity from their homes in the U.S. and have lost that investment capital altogether. The fact Daniel Ortega is now leading the country also isn’t helping things. However, tourism should continue doing well: It is one of the most affordable, beautiful and exotic locations that Americans can reach with relative ease (around 2 hours flying from Houston or Miami). If the U.S. does in fact go into a recession, people will be looking for lower cost places to travel, and that’s great news for Nicaraguan tourism and bad news for European tourism.
Over the long haul, Nicaragua should progress nicely. It offers great investment potential, but investors should use caution. Buying property in Nicaragua is not like buying property here in the states. You must understand the risks you are taking and not invest more capital than you can afford to lose. If you are careful, and invest with a long-term focus, then you will probably be happy with your investment when all is said and done. Beyond that, Nicaragua is an incredible place to visit (at least I’ve found it to be), so even if you find your self stuck with an investment property that you can’t sell, you should have a great time (and excuse for) visiting there.
For the sake of full disclosure, I do personally own property in Nicaragua.
I’ve been to Nicaragua a few times and absolutely loved my time there. The people are extremely friendly, and the scenery is absolutely to die for. The people at Sports Illustrated obviously saw the beauty, and the rest of the world is slowly catching on to this as well. Seeing as the Sports Illustrated Swimsuit Edition is by far the largest selling issue for the company every year, millions more people are being introduced to not only beautiful models but a beautiful country.
Just out of curiosity, I looked around on some forums and blogs and it already appears that many people have taken notice and are asking about real estate opportunities in the country. Whether they follow through on that curiosity is another story, but any buzz is good for business in Nicaragua.
Those who are new to Nicaragua should check out the article we wrote about investing in Nicaragua real estate. Nicaragua also came in number 5 on our list of the top Latin American real estate markets. Any potential investors though should be warned that investing in Nicaragua is risky, and should be looked at as a long-term investment.
Those who have visited Nicaragua know that the country is beautiful, but needs a lot of work, especially in terms of infrastructure. There is a lot of development underway, but it is moving slowly. Most investors in Nicaragua are Americans, so investment in the country has slowed recently due to the problems in the U.S. Many investors are either choosing to wait, or were planning to use equity from their homes in the U.S. and have lost that investment capital altogether. The fact Daniel Ortega is now leading the country also isn’t helping things. However, tourism should continue doing well: It is one of the most affordable, beautiful and exotic locations that Americans can reach with relative ease (around 2 hours flying from Houston or Miami). If the U.S. does in fact go into a recession, people will be looking for lower cost places to travel, and that’s great news for Nicaraguan tourism and bad news for European tourism.
Over the long haul, Nicaragua should progress nicely. It offers great investment potential, but investors should use caution. Buying property in Nicaragua is not like buying property here in the states. You must understand the risks you are taking and not invest more capital than you can afford to lose. If you are careful, and invest with a long-term focus, then you will probably be happy with your investment when all is said and done. Beyond that, Nicaragua is an incredible place to visit (at least I’ve found it to be), so even if you find your self stuck with an investment property that you can’t sell, you should have a great time (and excuse for) visiting there.
For the sake of full disclosure, I do personally own property in Nicaragua.
Wednesday, February 20, 2008
The Fed Seems To Be Surprised By Inflation Yet Again
A report released this morning by the BLS showed an increase in the consumer price index (CPI) of .4 percent for January. The year-over-year CPI grew to 4.3 percent from 4.1 percent the month before (and this is just what is being reported, see a previous inflation post for an alternative view on what the real inflation numbers are). The policies being implemented by the government and the Fed are not favorable to containing inflation, and this news is no surprise to most people in the financial world . Yet somehow these numbers seem to surprise the Fed each month, and then they downplay inflation in order to back up their policies.
I have to believe that the Fed knew good and well what the consequences were going to be for all of their rate cuts and cash injections, They are simply telling people, ‘Be happy now and don’t worry about the future,’ as they keep sweeping the dirt under the rug. That’s certainly how Greenspan ran the Fed, and it doesn’t seem like Mr. Bernanke is any different, but they can’t just keep passing the broom because the rug is going to run out of room someday.
As long as the Fed continues with their easy money policies, inflation will continue to get worse and worse and the dollar will continue to decline. Other countries are already taking notice. The U.S.’ enormous debt is being financed by foreigners, namely China and Japan. As their investments continue to lose value, they might have second thoughts about lending, and if the U.S. loses its ability to borrow at low rates, the economy could be in for a shock like nothing seen before in this country. Since the U.S. relies on borrowed funds even to pay on the current debt, the U.S. would have only the two options: defaulting on the debt, or printing more money. Default probably isn’t the first choice, so that leaves printing a lot more money, which would lead to astronomical inflation.
Financing debt with debt can’t go on forever. It may not be today or tomorrow, or even in the next 20 years, but eventually this thing will have to right itself. I sincerely hope that Bernanke, or even our next Fed chairman, can grow a spine and do what has to be done. It won’t make people happy in the short term, but when they are old and living on their fixed retirement incomes, they will be grateful that the country was able to rein in inflation.
Ron Paul is one of the few politicians that has acknowledged this problem and been willing to speak up about it. His willingness to do so, however, and how the majority of people have responded to it is evidence that it might be some time—and only after some painful realizations—before people truly embrace this message. I don’t expect it to happen anytime soon though, and will be making my investment decisions with that in mind.
I have to believe that the Fed knew good and well what the consequences were going to be for all of their rate cuts and cash injections, They are simply telling people, ‘Be happy now and don’t worry about the future,’ as they keep sweeping the dirt under the rug. That’s certainly how Greenspan ran the Fed, and it doesn’t seem like Mr. Bernanke is any different, but they can’t just keep passing the broom because the rug is going to run out of room someday.
As long as the Fed continues with their easy money policies, inflation will continue to get worse and worse and the dollar will continue to decline. Other countries are already taking notice. The U.S.’ enormous debt is being financed by foreigners, namely China and Japan. As their investments continue to lose value, they might have second thoughts about lending, and if the U.S. loses its ability to borrow at low rates, the economy could be in for a shock like nothing seen before in this country. Since the U.S. relies on borrowed funds even to pay on the current debt, the U.S. would have only the two options: defaulting on the debt, or printing more money. Default probably isn’t the first choice, so that leaves printing a lot more money, which would lead to astronomical inflation.
Financing debt with debt can’t go on forever. It may not be today or tomorrow, or even in the next 20 years, but eventually this thing will have to right itself. I sincerely hope that Bernanke, or even our next Fed chairman, can grow a spine and do what has to be done. It won’t make people happy in the short term, but when they are old and living on their fixed retirement incomes, they will be grateful that the country was able to rein in inflation.
Ron Paul is one of the few politicians that has acknowledged this problem and been willing to speak up about it. His willingness to do so, however, and how the majority of people have responded to it is evidence that it might be some time—and only after some painful realizations—before people truly embrace this message. I don’t expect it to happen anytime soon though, and will be making my investment decisions with that in mind.
Franklin TN Real Estate: What’s Going On?
Here at NuWire, we are constantly researching emerging real estate opportunities to introduce to our readers and locations in which readers have expressed interest through comments in questions. In addition to this, we monitor search engine traffic.
In our latest analysis, we found that a top search term (for U.S. real estate) was ‘Franklin TN real estate’. I had never heard of Franklin, TN, so naturally it piqued my interest. A quick search on ‘Franklin TN’ reveals that Franklin is a suburb of Nashville, and has a population of just over 50,000. But how could a town of 50,000 people produce 20,000 searches a day (according to SEOBook.com and Wordtracker) for the term ‘Franklin TN real estate’?
To give you an idea of how outrageous that number is, ‘Las Vegas real estate’ only receives 571 searches a day. Las Vegas is one of the most searched for U.S. real estate locations. It has an in-city population of over 500,000, a metro population of almost 2 million and name recognition around the world. How could a place like Las Vegas have 40 times fewer real estate searches?
I spent a few minutees trying to figure out what was so exciting about ‘Franklin TN real estate’. It doesn’t seem to be a bad place to invest, but nothing that would generate this amount of interest. My first thought is that this is an error on the part of the keyword tracking tools, but it could also be due to recent press that the city has received which I somehow have missed.
If there is that much interest in the city then we feel it is our obligation to cover the topic in depth for our readers. That being said, I thought I’d use this post as a test to see if there really is that much interest in Franklin, TN real estate. If you read this post and are searching for ‘Franklin TN real estate’ then please let me know why. If you know what the fuss is about (if there really is any fuss), we are curious to know too. And if you read this and have no interest in ‘Franklin TN real estate’ but would like to know more about another location in the world, feel free to tell us and we will look into that too. I look forward to hearing from you.
In our latest analysis, we found that a top search term (for U.S. real estate) was ‘Franklin TN real estate’. I had never heard of Franklin, TN, so naturally it piqued my interest. A quick search on ‘Franklin TN’ reveals that Franklin is a suburb of Nashville, and has a population of just over 50,000. But how could a town of 50,000 people produce 20,000 searches a day (according to SEOBook.com and Wordtracker) for the term ‘Franklin TN real estate’?
To give you an idea of how outrageous that number is, ‘Las Vegas real estate’ only receives 571 searches a day. Las Vegas is one of the most searched for U.S. real estate locations. It has an in-city population of over 500,000, a metro population of almost 2 million and name recognition around the world. How could a place like Las Vegas have 40 times fewer real estate searches?
I spent a few minutees trying to figure out what was so exciting about ‘Franklin TN real estate’. It doesn’t seem to be a bad place to invest, but nothing that would generate this amount of interest. My first thought is that this is an error on the part of the keyword tracking tools, but it could also be due to recent press that the city has received which I somehow have missed.
If there is that much interest in the city then we feel it is our obligation to cover the topic in depth for our readers. That being said, I thought I’d use this post as a test to see if there really is that much interest in Franklin, TN real estate. If you read this post and are searching for ‘Franklin TN real estate’ then please let me know why. If you know what the fuss is about (if there really is any fuss), we are curious to know too. And if you read this and have no interest in ‘Franklin TN real estate’ but would like to know more about another location in the world, feel free to tell us and we will look into that too. I look forward to hearing from you.
Tuesday, February 19, 2008
Fidel Castro Resigns: What’s Next For Cuba?
Finally, the news that everyone has been waiting for: Fidel Castro officially resigned this morning (I know many people were, and still are, hoping for his death, but I’m not going to go there). Castro has been in power for the past 49 years in Cuba, and has by most measurements destroyed the country. Cuba is a land full of potential and promise, but it needs access to U.S. investors, tourists, and trade to fully realize it. Unfortunately, that relationship has not been able to materialize due to various political issues.
With Cuba’s proximity to the U.S. and natural appeal, it should have been an investor’s dream location. It might someday become just that, but some big questions remain: How will Fidel Castro’s brother, Raul Castro, run the country? Will Raul refuse to make any major changes while Fidel is still alive? Even after Fidel is dead will Raul (or Raul’s successor) continue on with Fidel’s policies?
Unfortunately for U.S. investors, many prime opportunities have already been taken by foreign investors, especially Europeans, but even the Europeans have had a tough go with all the regulations imposed by Castro. If Cuba decides to open up the country to foreign investment it can be certain that there will be countless opportunities for investors. The U.S. should be Cuba’s number one source for trade and tourism, and once trade and travel are allowed between the two countries, Cuba’s economy and property values will jump by leaps and bounds.
Investing in a newly opened Cuba would not be without risk though. Cuba has been a dictatorship for the last 49 years, and its government has not respected investors’ rights. There is a precedent and a possibility that another dictator along the lines of Fidel Castro could come along and seize property, or impose unfair regulations. Until Cuba’s government shows stability for an extended period of time, that concern will be at the front of every investor’s mind. Whether the potential reward possibilities are worth the risk is a decision every investor will need to make for themselves.
Cuba has always been intriguing to me: Great food, a vibrant culture, great location and climate, but off-limits. I hope that this new administration takes Cuba in a new direction, and that I’ll be visiting sooner rather than later.
With Cuba’s proximity to the U.S. and natural appeal, it should have been an investor’s dream location. It might someday become just that, but some big questions remain: How will Fidel Castro’s brother, Raul Castro, run the country? Will Raul refuse to make any major changes while Fidel is still alive? Even after Fidel is dead will Raul (or Raul’s successor) continue on with Fidel’s policies?
Unfortunately for U.S. investors, many prime opportunities have already been taken by foreign investors, especially Europeans, but even the Europeans have had a tough go with all the regulations imposed by Castro. If Cuba decides to open up the country to foreign investment it can be certain that there will be countless opportunities for investors. The U.S. should be Cuba’s number one source for trade and tourism, and once trade and travel are allowed between the two countries, Cuba’s economy and property values will jump by leaps and bounds.
Investing in a newly opened Cuba would not be without risk though. Cuba has been a dictatorship for the last 49 years, and its government has not respected investors’ rights. There is a precedent and a possibility that another dictator along the lines of Fidel Castro could come along and seize property, or impose unfair regulations. Until Cuba’s government shows stability for an extended period of time, that concern will be at the front of every investor’s mind. Whether the potential reward possibilities are worth the risk is a decision every investor will need to make for themselves.
Cuba has always been intriguing to me: Great food, a vibrant culture, great location and climate, but off-limits. I hope that this new administration takes Cuba in a new direction, and that I’ll be visiting sooner rather than later.
Hillary Clinton Accuses Barack Obama Of Plagiarism: Who Cares?
The gloves are apparently off in the race for the Democratic nomination…well at least Hillary Clinton’s gloves are off. Clinton has now accused Barack Obama of plagiarizing one of his speeches from Massachusetts Governor Deval Patrick.
All I have to say is: Who cares? Obama responded that borrowing a few lines without attribution—and from a close friend I might add—was not a big deal. I agree that it isn’t a big deal, and I think most people would agree as well.
Message to the Clinton campaign: Focus your energy on stuff that matters…maybe the fact that Obama is proposing an enormous amount of new spending (even more than you) and has not yet explained how he intends to fulfill any of his wonderful promises. If you can force yourself to visit the GOP website, you might enjoy their Obama Spend-O-Meter.
Obama is certainly on a roll, and it appears Clinton is feeling desperate. Obama has done a great job drumming up support among the masses with his public speaking and rallying among youth and celebrities. Just for kicks, I even watched Obama’s YouTube video, and it was actually pretty amusing. More importantly, the video has received over 4 million hits, and there are other non-official Obama campaign videos with even more hits. A search for Hillary Clinton on YouTube brings up countless videos which poke fun at her, it takes some effort sifting through them to find a positive one. The point is, Obama is doing a much better job marketing himself and appealing to the masses than Clinton is.
I don’t think Clinton really stands much of a chance right now, but if she wants to make a run for it, she needs to start focusing her attention on things a bit more important than weak plagiarism claims. Considering that Clinton has herself been accused of plagiarism in the past it also seems a bit ironic. Accusing Obama of plagiarism of this sort just makes her look desperate. In addition it undermines faith in her maturity and belies a lack of confidence in her own campaign (and a potential hypocrisy, as stated in my last comment): unattractive features for a potential leader.
All I have to say is: Who cares? Obama responded that borrowing a few lines without attribution—and from a close friend I might add—was not a big deal. I agree that it isn’t a big deal, and I think most people would agree as well.
Message to the Clinton campaign: Focus your energy on stuff that matters…maybe the fact that Obama is proposing an enormous amount of new spending (even more than you) and has not yet explained how he intends to fulfill any of his wonderful promises. If you can force yourself to visit the GOP website, you might enjoy their Obama Spend-O-Meter.
Obama is certainly on a roll, and it appears Clinton is feeling desperate. Obama has done a great job drumming up support among the masses with his public speaking and rallying among youth and celebrities. Just for kicks, I even watched Obama’s YouTube video, and it was actually pretty amusing. More importantly, the video has received over 4 million hits, and there are other non-official Obama campaign videos with even more hits. A search for Hillary Clinton on YouTube brings up countless videos which poke fun at her, it takes some effort sifting through them to find a positive one. The point is, Obama is doing a much better job marketing himself and appealing to the masses than Clinton is.
I don’t think Clinton really stands much of a chance right now, but if she wants to make a run for it, she needs to start focusing her attention on things a bit more important than weak plagiarism claims. Considering that Clinton has herself been accused of plagiarism in the past it also seems a bit ironic. Accusing Obama of plagiarism of this sort just makes her look desperate. In addition it undermines faith in her maturity and belies a lack of confidence in her own campaign (and a potential hypocrisy, as stated in my last comment): unattractive features for a potential leader.
Monday, February 18, 2008
An Intriguing View On The Economic Stimulus Package
As a longtime skeptic and occasional fan of Glenn Beck, I couldn’t help but pay attention when reading a recent article by him about President Bush’s’ economic stimulus package.
Personal political opinions aside, I couldn’t help but be interested–nay, even persuaded–by his solution to the economic stimulus probl–ahem, package. Though it is mostly honest in its intentions, it is still broken.
A disclaimer: By most accounts, my generation will not see a dime of their social security. I am not in support of certain parts of the package for reasons highlighted in Beck’s editorial. Namely, the problems concerning government mismanagement of policy and procedure.
Beck begins his column by saying,
Beck continues by claiming that if the government opted to issue debit cards rather than checks, two large problems could be avoided.
First is the issue of not knowing who will spend the money, and where. With issued checks, there is no guarantee that the money wouldn’t be invested or even worse, (gasp) saved. With debit cards, the original intention of the economic stimulus package would be guaranteed and the government would know that the money is going back into the economy. Further, with cards there would be no guarantee that each person would use their card–no loss there.
Second is the issue of time. Because we’re in the depths of tax season, the government’s first priority will not be cutting additional checks. Make no mistake: The process of cutting over 150 billion in checks will be a lengthy one,
Beck also adds,
And it's wit and wisdom like that which will hopefully get us out of it.
This was a guest post from Marie Langhout, NuWire’s Creative Editor. If you like what you read here you can find more at Marie’s blog: The Brink Tank.
Personal political opinions aside, I couldn’t help but be interested–nay, even persuaded–by his solution to the economic stimulus probl–ahem, package. Though it is mostly honest in its intentions, it is still broken.
A disclaimer: By most accounts, my generation will not see a dime of their social security. I am not in support of certain parts of the package for reasons highlighted in Beck’s editorial. Namely, the problems concerning government mismanagement of policy and procedure.
Beck begins his column by saying,
“After Hurricane Katrina, FEMA needed to get money to victims fast, so they tried something new. Instead of issuing checks, they issued $2,000 emergency debit cards for evacuees to use for food, water, and supplies.
As you probably remember, 2005 wasn't exactly a banner year for FEMA. Along with food and water, some hurricane evacuees also bought Louis Vuitton purses, diamonds, and even breast implants. That caused major embarrassment for the government (at a time when they weren't exactly in the market for any more of it) and the debit card program was scrapped.
But while purchasing frivolous items may not have been what FEMA was hoping for, it's exactly what the government is hoping for now. Frivolous items have far higher profit margins than boring necessities like food and water, and it's that profit that will (at least in theory) trickle down to help create more jobs and eventually stimulate economic growth.”
Beck continues by claiming that if the government opted to issue debit cards rather than checks, two large problems could be avoided.
First is the issue of not knowing who will spend the money, and where. With issued checks, there is no guarantee that the money wouldn’t be invested or even worse, (gasp) saved. With debit cards, the original intention of the economic stimulus package would be guaranteed and the government would know that the money is going back into the economy. Further, with cards there would be no guarantee that each person would use their card–no loss there.
Second is the issue of time. Because we’re in the depths of tax season, the government’s first priority will not be cutting additional checks. Make no mistake: The process of cutting over 150 billion in checks will be a lengthy one,
Beck also adds,
“And debit cards also have the advantage of looking exactly like credit cards, which will reinforce the behavior that got us into this mess in the first place.”
And it's wit and wisdom like that which will hopefully get us out of it.
This was a guest post from Marie Langhout, NuWire’s Creative Editor. If you like what you read here you can find more at Marie’s blog: The Brink Tank.
Is The Infinite Banking Concept A Scam?
Since NuWire wrote an article about the Infinite Banking Concept, we have noticed many inquiries wondering whether or not the Infinite Banking Concept was really a scam. In order to answer these questions, I thought I’d write a blog post on the subject.
To the question on whether or not the Infinite Banking Concept is a scam, the answer is no. Infinite Banking is just a creative way to use whole life insurance. People have been doing things similar to the Infinite Banking Concept for a long time. They just didn’t know what to call it. The Infinite Banking Concept is a trademarked name created by Nelson Nash (the founder of the Infinite Banking Concept).
Nash travels and teaches insurance agents about the Infinite Banking Concept so that they can generate more sales. This is how Nash makes his money. Those insurance agents are then able to teach their clients about this new and exciting way to use whole life insurance. This opens up a new sales avenue for these agents to convince potential clients who would otherwise have no interest in buying a whole life insurance policy. Since whole life offers large commissions, that are much larger than term life, this is a great tool to increase revenue for the agents.
The Infinite Banking Concept is not something you can buy. It just shows you a new way to use something already familiar and should work with any dividend-paying whole life plan. You can use these concepts without signing up for any special plan or paying Nash any money. Those agents who have been trained by Nash are supposed to have a better understanding of the ways to use this strategy. That being said if you are going to open a whole life plan with those hefty commissions for the purpose of utilizing the Infinite Banking Concepts, then you might as well use an agent who can give you some advice and tips and make sure you do it properly. Using the Infinite Banking Concept in your whole life insurance policy though doesn’t change the policy. As long as you believe that whole life insurance isn’t a scam, then the Infinite Banking Concept shouldn’t be considered a scam either.
I will add that the projected returns your plan experiences could very well be different then what is portrayed in Nash’s book. I believe them to be fairly accurate examples, or were at the time the book was written, but they are in no way guaranteed. It is also possible to use these concepts in a variable life account where base returns are tied to the market. Nash doesn’t recommend that people do this, but these are open concepts and they can be used in any way one sees fit.
To the question on whether or not the Infinite Banking Concept is a scam, the answer is no. Infinite Banking is just a creative way to use whole life insurance. People have been doing things similar to the Infinite Banking Concept for a long time. They just didn’t know what to call it. The Infinite Banking Concept is a trademarked name created by Nelson Nash (the founder of the Infinite Banking Concept).
Nash travels and teaches insurance agents about the Infinite Banking Concept so that they can generate more sales. This is how Nash makes his money. Those insurance agents are then able to teach their clients about this new and exciting way to use whole life insurance. This opens up a new sales avenue for these agents to convince potential clients who would otherwise have no interest in buying a whole life insurance policy. Since whole life offers large commissions, that are much larger than term life, this is a great tool to increase revenue for the agents.
The Infinite Banking Concept is not something you can buy. It just shows you a new way to use something already familiar and should work with any dividend-paying whole life plan. You can use these concepts without signing up for any special plan or paying Nash any money. Those agents who have been trained by Nash are supposed to have a better understanding of the ways to use this strategy. That being said if you are going to open a whole life plan with those hefty commissions for the purpose of utilizing the Infinite Banking Concepts, then you might as well use an agent who can give you some advice and tips and make sure you do it properly. Using the Infinite Banking Concept in your whole life insurance policy though doesn’t change the policy. As long as you believe that whole life insurance isn’t a scam, then the Infinite Banking Concept shouldn’t be considered a scam either.
I will add that the projected returns your plan experiences could very well be different then what is portrayed in Nash’s book. I believe them to be fairly accurate examples, or were at the time the book was written, but they are in no way guaranteed. It is also possible to use these concepts in a variable life account where base returns are tied to the market. Nash doesn’t recommend that people do this, but these are open concepts and they can be used in any way one sees fit.
Friday, February 15, 2008
Fed Signals More Interest Rate Cuts Could Be Coming
This doesn’t really come as much of a surprise, but Federal Reserve chairman Ben Bernanke signaled that a sizeable interest rate cut could be on its way when the board meets on Mar. 18.
Even with all the rate cuts the Fed has already made, and the $168 billion economic stimulus package that was recently passed, the economic picture for the U.S. still seems bleak. Yet the government seems optimistic that they will be able to stop the looming recession. I’m not sure if they are in denial, or if it is just a public relations ploy, but I don’t see them standing much of a chance of preventing it.
This financial storm (of sorts) has been in the works for some time, and short of completely destroying the dollar I’m not sure how they are going to avoid it. Now, if they were to destroy the dollar and let inflation run wild they might technically be able to avoid a recession; however, there will be costly repercussions stemming from those actions. They have done a decent job of devaluing the dollar, but it is going to take a lot more to accomplish what they want.
This is an election year and the Republicans don’t want to be in the midst of a recession come voting time; that would be a killer for the party. The Democrats have been attacking Bush’s policies for some time, and will not hesitate to redirect their efforts onto McCain who, by the way, is being backed by President Bush. A full on recession will only give the Democrats more fuel to add to the fire. Needless to say, President Bush will do whatever it takes to at least delay this recession, and will put as much pressure on Bernanke and the Fed as he can to do so.
My two cents for investors is to plan for a recession and get out of the dollar. One of two things is going to happen: either we are going to have a recession or the dollar is going to tank, and it is likely that both will happen to varying extents. Moving your investments, or at least heavily diversifying, into assets based in other currencies can help protect from both. The more uncorrelated the foreign market is to the U.S. the better, just make sure to diversify in order to protect yourself. Read our Top Recession Investments article for some other ideas, and if you are looking to buy foreign real estate you should make sure to read our write-up on HiFX, which does currency exchanges and transfers.
Even with all the rate cuts the Fed has already made, and the $168 billion economic stimulus package that was recently passed, the economic picture for the U.S. still seems bleak. Yet the government seems optimistic that they will be able to stop the looming recession. I’m not sure if they are in denial, or if it is just a public relations ploy, but I don’t see them standing much of a chance of preventing it.
This financial storm (of sorts) has been in the works for some time, and short of completely destroying the dollar I’m not sure how they are going to avoid it. Now, if they were to destroy the dollar and let inflation run wild they might technically be able to avoid a recession; however, there will be costly repercussions stemming from those actions. They have done a decent job of devaluing the dollar, but it is going to take a lot more to accomplish what they want.
This is an election year and the Republicans don’t want to be in the midst of a recession come voting time; that would be a killer for the party. The Democrats have been attacking Bush’s policies for some time, and will not hesitate to redirect their efforts onto McCain who, by the way, is being backed by President Bush. A full on recession will only give the Democrats more fuel to add to the fire. Needless to say, President Bush will do whatever it takes to at least delay this recession, and will put as much pressure on Bernanke and the Fed as he can to do so.
My two cents for investors is to plan for a recession and get out of the dollar. One of two things is going to happen: either we are going to have a recession or the dollar is going to tank, and it is likely that both will happen to varying extents. Moving your investments, or at least heavily diversifying, into assets based in other currencies can help protect from both. The more uncorrelated the foreign market is to the U.S. the better, just make sure to diversify in order to protect yourself. Read our Top Recession Investments article for some other ideas, and if you are looking to buy foreign real estate you should make sure to read our write-up on HiFX, which does currency exchanges and transfers.
How to Invest Your Tax Rebate Check While Still Stimulating the Economy
For those patriotic Americans out there who want to invest their tax rebate from the 2008 Economic Stimulus Package and still stimulate the economy, here is an idea: Yesterday, I read a blog post on Prosper.com that brought up a great point. If you don’t want to buy more stuff, and if you would prefer to invest or save your tax rebate (good for you, by the way), then why not loan that money out to someone who does want or need to buy stuff?
As long as the loan proceeds are put back into the economy, the tax rebate will actually do what it is intended to do, and at the same time you can generate a nice return. This is good for America, and good for your pocket book. You can’t beat that.
For those who are not familiar with Prosper, it is a peer-to-peer lending site where investors can provide small loans for profit. Prosper does all the work for the investors, from pulling credit to paperwork and collection. All the investor has to do is choose to whom they want to lend, and Prosper can even help with that. For more information on Prosper, check out our article: Prosper Peer-to-Peer Lending.
As long as the loan proceeds are put back into the economy, the tax rebate will actually do what it is intended to do, and at the same time you can generate a nice return. This is good for America, and good for your pocket book. You can’t beat that.
For those who are not familiar with Prosper, it is a peer-to-peer lending site where investors can provide small loans for profit. Prosper does all the work for the investors, from pulling credit to paperwork and collection. All the investor has to do is choose to whom they want to lend, and Prosper can even help with that. For more information on Prosper, check out our article: Prosper Peer-to-Peer Lending.
Thursday, February 14, 2008
Study Shows How City Regulation Affects Housing Prices
According to an article published today in the Seattle Times, University of Washington professor Theo Eicher found that the median price of Seattle real estate, which rose over $200,000 from 1989 to 2006, was likely a result of regulations imposed by the city.
In Eicher’s analysis of 250 U.S. cities, Seattle is:
• First in terms of the impact of state involvement in land issues.
• In the top 3 percent for approval delays for new construction.
• In the top 10 percent for local political pressure influencing land use.
In addition, a study performed by Wharton showed that cities that have high median incomes, high home prices and a large percentage of college-educated workers—such as Seattle—tend to have the most land-use regulations. Other cities with a high level of regulation and high real estate prices include San Francisco and Boston. In contrast, developers in cities such as Houston and Atlanta,face little regulation and real estate prices are accordingly lower.
The Seattle Times article also quotes Sam Anderson, who is the executive officer of the Master Builders Association of King & Snohomish Counties. According to Anderson, the various fees and requirements imposed by these regulations can exceed 30 percent of the total building project budget in Seattle.
This news probably makes sense to most investors, those who don’t pay attention to city politics should start doing so. If a city starts down the path of increased regulation, investors might want to consider jumping on board. As long as the other fundamentals of the city look good, increased regulation should only lead to higher housing appreciation rates. The harder and more costly it is to build new construction in a city, the more value there will be to the existing housing stock.
In the case of Seattle, these regulations were imposed on all new construction. Developers have had a difficult time not only getting single-family homes up, but also multi-family housing, which has resulted in a sharp increase in rental rates. Since new multi-family housing can’t go up fast enough to meet demand, the supply of rental housing is being squeezed. This is bad news for tenants, but great news for investors.
In Eicher’s analysis of 250 U.S. cities, Seattle is:
• First in terms of the impact of state involvement in land issues.
• In the top 3 percent for approval delays for new construction.
• In the top 10 percent for local political pressure influencing land use.
In addition, a study performed by Wharton showed that cities that have high median incomes, high home prices and a large percentage of college-educated workers—such as Seattle—tend to have the most land-use regulations. Other cities with a high level of regulation and high real estate prices include San Francisco and Boston. In contrast, developers in cities such as Houston and Atlanta,face little regulation and real estate prices are accordingly lower.
The Seattle Times article also quotes Sam Anderson, who is the executive officer of the Master Builders Association of King & Snohomish Counties. According to Anderson, the various fees and requirements imposed by these regulations can exceed 30 percent of the total building project budget in Seattle.
This news probably makes sense to most investors, those who don’t pay attention to city politics should start doing so. If a city starts down the path of increased regulation, investors might want to consider jumping on board. As long as the other fundamentals of the city look good, increased regulation should only lead to higher housing appreciation rates. The harder and more costly it is to build new construction in a city, the more value there will be to the existing housing stock.
In the case of Seattle, these regulations were imposed on all new construction. Developers have had a difficult time not only getting single-family homes up, but also multi-family housing, which has resulted in a sharp increase in rental rates. Since new multi-family housing can’t go up fast enough to meet demand, the supply of rental housing is being squeezed. This is bad news for tenants, but great news for investors.
Wednesday, February 13, 2008
Economic Stimulus Package Officially Finalized: Now What About My Tax Rebate Check?
Earlier today President Bush officially signed off on the Economic Stimulus Package, so it is now official. For all those people wondering about when they can expect to receive their tax rebate checks, the current estimated timeframe is sometime in May.
If you are wondering whether or not you are entitled to a refund, the main qualifying factor is your income. If you make less than $75,000 as an individual, or $150,000 as a married couple, then you should be getting the full rebate. The full rebate is $600 for individuals and $1,200 for couples. In addition you can also get another $300 per child. For every thousand dollars your income is above the limits, however, you lose approximately 5 percent of the rebate.
According to the IRS website, in order to receive the rebate checks tax payers don’t need to do anything other than file their 2007 taxes as normal. The rebate checks are actually part of the 2008 tax year, but the payments will be delivered based on 2007 taxpayer information. According to the Wall Street Journal, taxpayers who qualify for the rebate based on 2007 information but not on their 2008 information will not be required to pay back their rebate. In addition, those who will qualify for a higher rebate amount based on their final 2008 information—such as those who have a baby in 2008—will be able to claim that additional rebate on their 2008 taxes.
For more information on the stimulus plan visit the IRS website.
Investors will have to wait and see if the stimulus plan works as planned, but the bet here is that it doesn’t come close to meeting the expectations of Washington, and just leads our nation further in debt. For those who don’t speak investor-ese, that means it is time to get out of the dollar. Even though the dollar has rallied somewhat recently, the long term outlook is not good. For some investment ideas see our article: Decline of the Dollar Spurs Diversification.
If you are wondering whether or not you are entitled to a refund, the main qualifying factor is your income. If you make less than $75,000 as an individual, or $150,000 as a married couple, then you should be getting the full rebate. The full rebate is $600 for individuals and $1,200 for couples. In addition you can also get another $300 per child. For every thousand dollars your income is above the limits, however, you lose approximately 5 percent of the rebate.
According to the IRS website, in order to receive the rebate checks tax payers don’t need to do anything other than file their 2007 taxes as normal. The rebate checks are actually part of the 2008 tax year, but the payments will be delivered based on 2007 taxpayer information. According to the Wall Street Journal, taxpayers who qualify for the rebate based on 2007 information but not on their 2008 information will not be required to pay back their rebate. In addition, those who will qualify for a higher rebate amount based on their final 2008 information—such as those who have a baby in 2008—will be able to claim that additional rebate on their 2008 taxes.
For more information on the stimulus plan visit the IRS website.
Investors will have to wait and see if the stimulus plan works as planned, but the bet here is that it doesn’t come close to meeting the expectations of Washington, and just leads our nation further in debt. For those who don’t speak investor-ese, that means it is time to get out of the dollar. Even though the dollar has rallied somewhat recently, the long term outlook is not good. For some investment ideas see our article: Decline of the Dollar Spurs Diversification.
Barack Obama Thinks He Could Have Prevented Current Economic Troubles
Could Barack Obama have prevented the subprime and housing fallout? Could he have prevented the credit crisis that is being felt across our economy? Well, according to quotes from a recent speech Obama gave at a General Motors plant in Janesville, Wisconsin, he seems to think so. The following excerpt was pulled from a recent Associated Press article:
“‘We are not standing on the brink of recession due to forces beyond our control,’ Obama said in excerpts of a speech at a General Motors plant in Janesville, Wis. ‘The fallout from the housing crisis that's cost jobs and wiped out savings was not an inevitable part of the business cycle. It was a failure of leadership and imagination in Washington.’”
The implications being made by Mr. Obama in the above quote are very strong. It is likely that he was simply playing to the crowd and telling them what they wanted to hear, although I wonder if he really believes what he is saying. Personally I don’t think Obama, McCain, or Clinton would have had the wherewithal to foresee what was going to happen, let alone prevent it. To imply that he would have known better seems just a little far-fetched to me.
I guess that is how the political game gets played, though: tell the people what they want to hear and they will vote for you. After all, once you get elected it doesn’t really matter. You can just make excuses on why your campaign promises didn’t happen. Not that I’m bitter or anything about politicians in general...moving on...
From what I can gather about Obama’s economic policies, my opinion is that they are the worst of all the presidential candidates (In terms of the overall benefit to the economy). Obama is proposing the highest amount of new spending (see Presidential Candidate Budget Analysis), and much of it is dedicated to social programs. While providing health care for millions of Americans would be great, in terms of what’s best for the economy it probably doesn’t make the list.
To pay for these budget increases (albeit only partially), Obama is planning to let the Bush tax cuts expire. The Bush tax cuts do strongly favor the wealthy—which is why Obama wants to get rid of them—but they also have proven to stimulate the economy. Removing those tax cuts and funding health care will help many Americans desperately in need, but in purely economic terms it will probably only make things worse.
“‘We are not standing on the brink of recession due to forces beyond our control,’ Obama said in excerpts of a speech at a General Motors plant in Janesville, Wis. ‘The fallout from the housing crisis that's cost jobs and wiped out savings was not an inevitable part of the business cycle. It was a failure of leadership and imagination in Washington.’”
The implications being made by Mr. Obama in the above quote are very strong. It is likely that he was simply playing to the crowd and telling them what they wanted to hear, although I wonder if he really believes what he is saying. Personally I don’t think Obama, McCain, or Clinton would have had the wherewithal to foresee what was going to happen, let alone prevent it. To imply that he would have known better seems just a little far-fetched to me.
I guess that is how the political game gets played, though: tell the people what they want to hear and they will vote for you. After all, once you get elected it doesn’t really matter. You can just make excuses on why your campaign promises didn’t happen. Not that I’m bitter or anything about politicians in general...moving on...
From what I can gather about Obama’s economic policies, my opinion is that they are the worst of all the presidential candidates (In terms of the overall benefit to the economy). Obama is proposing the highest amount of new spending (see Presidential Candidate Budget Analysis), and much of it is dedicated to social programs. While providing health care for millions of Americans would be great, in terms of what’s best for the economy it probably doesn’t make the list.
To pay for these budget increases (albeit only partially), Obama is planning to let the Bush tax cuts expire. The Bush tax cuts do strongly favor the wealthy—which is why Obama wants to get rid of them—but they also have proven to stimulate the economy. Removing those tax cuts and funding health care will help many Americans desperately in need, but in purely economic terms it will probably only make things worse.
Are We In A Recession? 61 Percent Of Americans Think So
According to a recent Associated Press-Ipsos poll, 61 percent of Americans think we are currently in a recession. While President Bush and other government officials have repeatedly denied that fact, it seems America has already made up its mind. Whether or not the U.S. is actually in a recession doesn’t really matter if everyone is behaving like it.
There are a couple definitions of a recession, so I’ll mention both to be clear. The first and most commonly known is simply having back to back quarters of negative economic growth. While the U.S. economy is slowing down it has not reportedly entered into negative territory. So according to that definition we couldn’t be in a recession quite yet.
The second definition of a recession is a bit more confusing, but is part of a formula compiled by The National Bureau of Economic Research. According to the Associated Press the formula takes into account such things as employment and income growth. By that measure, the last recession was in 2001, starting in March and ending in November.
No matter whether you think we are in a recession or not, if consumers behave as though we are, investors will be affected likewise. With recession typically comes significant cut backs in spending. This happens both from consumers and businesses. When this occurs, many investment types—from stocks to real estate—will be negatively affected, and investors need to account for that.
Luckily for investors, there is money to be made when the economy is performing poorly just as there is when the economy is doing well. For example businesses and other investments relying on consumer spending will typically perform poorly, while businesses selling necessities (or staples) should continue on course. For a list of some good alternative investments to look at during recessionary times read our article: The Top 5 Recession Investments.
There are a couple definitions of a recession, so I’ll mention both to be clear. The first and most commonly known is simply having back to back quarters of negative economic growth. While the U.S. economy is slowing down it has not reportedly entered into negative territory. So according to that definition we couldn’t be in a recession quite yet.
The second definition of a recession is a bit more confusing, but is part of a formula compiled by The National Bureau of Economic Research. According to the Associated Press the formula takes into account such things as employment and income growth. By that measure, the last recession was in 2001, starting in March and ending in November.
No matter whether you think we are in a recession or not, if consumers behave as though we are, investors will be affected likewise. With recession typically comes significant cut backs in spending. This happens both from consumers and businesses. When this occurs, many investment types—from stocks to real estate—will be negatively affected, and investors need to account for that.
Luckily for investors, there is money to be made when the economy is performing poorly just as there is when the economy is doing well. For example businesses and other investments relying on consumer spending will typically perform poorly, while businesses selling necessities (or staples) should continue on course. For a list of some good alternative investments to look at during recessionary times read our article: The Top 5 Recession Investments.
Tuesday, February 12, 2008
Venezuela Leader Hugo Chavez Threatens To Cut U.S. Oil Supply
Exxon is in the midst of a fierce battle with Venezuela in response to the expropriation of Exxon assets by the Venezuelan government. The value of the expropriated Exxon assets was approximately $12 billion. According to Business Week, Exxon recently won an international court order that prohibits Petróleos de Venezuela (PDVSA), Venezuela’s national oil company, from selling any of its overseas assets pending a court ruling. Naturally, this infuriated Hugo Chavez who is not known for his calm demeanor and friendliness towards the U.S. to begin with.
Chavez has since threatened that he would cut off the Venezuelan supply of oil into the U.S.,but it is unlikely that he will follow through with his threats. According to Money Week Venezuela exports around 75 percent of its oil to the U.S., while the U.S. gets only about 13 percent of its oil from Venezuela. In addition the U.S. is just about the only country which has refineries capable of working with Venezuelan crude. If Chavez were to act on his threats it would cost his country much more than it would cost the U.S. Considering that he is already losing favor in his country (see prior post “Chavez Defeat A Victory For Democracy”), a move such as this could prove disastrous for him.
The announcement did cause a slight rise in the price of oil, even though most feel that these threats are idle. Predicting the price of oil is never easy and even the slightest rumblings from oil-producing countries can have a dramatic impact. Any price movement caused by these threats should likely be corrected over the coming days as threats prove empty. If out of pure spite Chavez decides to follow through and cut off Venezuelan oil exports to the U.S., investors can expect the price of oil to jump significantly. However, it is questionable whether it would reach the $200 level Chavez says it would. I personally doubt it, but with the volatile nature of the market you never know.
Chavez has since threatened that he would cut off the Venezuelan supply of oil into the U.S.,but it is unlikely that he will follow through with his threats. According to Money Week Venezuela exports around 75 percent of its oil to the U.S., while the U.S. gets only about 13 percent of its oil from Venezuela. In addition the U.S. is just about the only country which has refineries capable of working with Venezuelan crude. If Chavez were to act on his threats it would cost his country much more than it would cost the U.S. Considering that he is already losing favor in his country (see prior post “Chavez Defeat A Victory For Democracy”), a move such as this could prove disastrous for him.
The announcement did cause a slight rise in the price of oil, even though most feel that these threats are idle. Predicting the price of oil is never easy and even the slightest rumblings from oil-producing countries can have a dramatic impact. Any price movement caused by these threats should likely be corrected over the coming days as threats prove empty. If out of pure spite Chavez decides to follow through and cut off Venezuelan oil exports to the U.S., investors can expect the price of oil to jump significantly. However, it is questionable whether it would reach the $200 level Chavez says it would. I personally doubt it, but with the volatile nature of the market you never know.
Ethanol And Other Biofuels Prove To Be A Bad Investment
A recent study published in the journal Science states that biofuel production actually creates more greenhouse gases than traditional oil-based fossil fuels. For those of us who have been caught up in Ethanol mania here in the U.S. (see the recent passing of the energy bill), this news has to be shocking. According to the energy bill, the U.S. is committing billions of dollars to new biofuel production, but instead of spending money to help the environment it appears that we are spending money to make things even worse.
As this news travels through Washington D.C. it would not be surprising to see some adjustments made to the recently passed bill. If the study proves to be factual, then it would be extremely imprudent to continue on the current path. Of course, seeing as our government loves to throw money away, I wouldn’t put it past them to overlook this, but I would be very hesitant as an investor now to invest in anything related to biofuels.
In the U.S. farmland prices, as well as corn, have skyrocketed largely due to Ethanol. If suddenly the government were to no longer require the use of Ethanol, or other biofuels, the value of corn and farmland would likely take a dive. This would be good news for most of the world, considering the enormous increases in the price of food, among other corn based products. However, farmers and those invested in farmland would not be so happy.
Needless to say investors should stay away from Ethanol producers, and possibly corn as well. In addition farmland investment should be looked at carefully, although there are many other things farmland can be used for other than corn. Commodities in general should still continue their bull run for a while longer. Those who have invested or who are considering investing in alternative biofuel production such as switch grass, jatropha, palm oil, and so on should do more intense research into this report. Not all biofuels are created equal. Some may cause more damage than others, and some biofuels might still be lucrative in certain locations even if this report is correct in its assessment. If biofuels are something that you want to invest in, then it would be wise to do in-depth due diligence about the sustainability of the industry before hand.
As this news travels through Washington D.C. it would not be surprising to see some adjustments made to the recently passed bill. If the study proves to be factual, then it would be extremely imprudent to continue on the current path. Of course, seeing as our government loves to throw money away, I wouldn’t put it past them to overlook this, but I would be very hesitant as an investor now to invest in anything related to biofuels.
In the U.S. farmland prices, as well as corn, have skyrocketed largely due to Ethanol. If suddenly the government were to no longer require the use of Ethanol, or other biofuels, the value of corn and farmland would likely take a dive. This would be good news for most of the world, considering the enormous increases in the price of food, among other corn based products. However, farmers and those invested in farmland would not be so happy.
Needless to say investors should stay away from Ethanol producers, and possibly corn as well. In addition farmland investment should be looked at carefully, although there are many other things farmland can be used for other than corn. Commodities in general should still continue their bull run for a while longer. Those who have invested or who are considering investing in alternative biofuel production such as switch grass, jatropha, palm oil, and so on should do more intense research into this report. Not all biofuels are created equal. Some may cause more damage than others, and some biofuels might still be lucrative in certain locations even if this report is correct in its assessment. If biofuels are something that you want to invest in, then it would be wise to do in-depth due diligence about the sustainability of the industry before hand.
Monday, February 11, 2008
Mike Huckabee Making Life Difficult For John McCain
While most people have all but handed John McCain the Republican presidential nomination, Mike Huckabee isn’t about to give up without a fight. Huckabee is trailing McCain in total delegates by a wide margin. McCain has 723 to Huckabee’s 217 according, to the latest CNN numbers. Those numbers do not include Louisiana’s delegates, where Huckabee came in first, and Washington state, where Huckabee finished second to McCain.
To show how committed Huckabee is to this race, and how prepared he is to make things difficult for the McCain campaign, Huckabee is looking at possible legal issues surrounding the Washington State caucus and is disputing the results, according to the Washington Post. It appears Huckabee is going to fight tooth and nail until the end on this campaign.
While the chances of Huckabee becoming the Republican nominee are unlikely, he is certainly doing his best to thwart McCain’s presidential hopes. One of the biggest hurdles ahead for McCain is his lack of funding. He has had a hard time raising funds and would love nothing more than to save as much money as possible for the battle for the presidency against the winner of the Democratic race between Barack Obama and Hillary Clinton. The fact that McCain has to continue fighting Huckabee off is costing him more and more of his precious funding.
The following excerpt from the Washington Post pretty much sums up what most people think of Huckabee’s chances:
“Karl Rove, President Bush's former senior political adviser, did his best to shoot down Huckabee's chances. Rove said on CBS that it is far-fetched to presume that McCain will say or do something to doom his candidacy.
Huckabee ‘said he could win, provided that there were mistakes made by his opponent, and that some of these bound or pledged delegates would change their mind. Well, even if they change their mind, they're bound or pledged to vote for the candidate who won their primary,’ Rove said. ‘I find it very unlikely, completely implausible, that Governor Huckabee could win 83 percent of the delegates.’”
It should also be added that Rove is backing McCain for the nomination, so his views could be biased. Rove's viewpoint is also generally held by most other observers outside of the Huckabee camp, though.
LEED Certification: Is It Worth It?
Environmentalism is a huge topic today. Investors must always keep an open mind, so today we are going to explore LEED Certification and attempt to answer the question of whether or not LEED certification is worth it for real estate investors.
The cost to achieve LEED certification on a residential home is a hard number to figure out exactly, as the LEED certification system is point-based and can be a bit confusing. In addition, LEED certification for residential homes is a newer program, modeled after the LEED certification program for commercial buildings, according to Builder Magazine. To get some background information on the program, read our article about the LEED certification program.
LEED certification can be awarded in four levels: certified, silver, gold and platinum. Each level, of course, requires more points, and thus will be more expensive to obtain for a property. As an investor, in order to make an informed decision, you will need to figure out what the costs will be, and what the potential return will be.
First let's discuss the potential returns. The exact numbers are going to be hard to figure out, but you can be certain that there is a definite added value to "green" products in most places across the U.S. People are generally willing to pay more for "green" products because it makes them feel good. There is also an associated status with it. The same certainly applies to housing. If people were given the choice between two comparable houses, one with LEED certification and one without, many people would choose the one with the LEED certification--and even be willing to pay more for it.
The biggest return for investors will certainly be in the marketing and desirability of their property. While it is hard to put a number on that, in today’s tough marketplace, anything that helps move a property is welcome. Because we are simply looking for the ability to market the property as LEED certified--to show that the house is “green”--it would make sense that all we would really need is to achieve is the minimum certified rating. Sure those higher rankings would be great, but they also are going to cost a lot more.
To figure out the costs, and which items make the most sense for you to take on, check out the LEED for homes rating system. Some of the items will be cheap to implement, while others will be expensive. In addition, there are some points awarded simply for a favorable location and other factors beyond the homeowner's control. Find the items that will be the cheapest to add in and work from there. Once you achieve the point total you are looking for, then you have your cost. If you want to make things easy, you can always just order a modular home, some of which are made to LEED certification standards already. If you want a custom home, or if you want to work from an existing home, you can hire a consultant to help if needed.
Looking at the numbers--which are all hypothetical, really--on the surface, LEED certification would appear to be worth the investment. When obtained in a cost efficient manner, the lowest certification level appears to be the best bet for investors in terms of return. This, of course, is assuming your property is in a market which has demand for "green" products. A simple check could be whether or not you have a Whole Foods or other similar store nearby. If there is one near you, then chances are there are a good number of environmentally and health conscious people around who would be willing to pay for a home with LEED certification.
The cost to achieve LEED certification on a residential home is a hard number to figure out exactly, as the LEED certification system is point-based and can be a bit confusing. In addition, LEED certification for residential homes is a newer program, modeled after the LEED certification program for commercial buildings, according to Builder Magazine. To get some background information on the program, read our article about the LEED certification program.
LEED certification can be awarded in four levels: certified, silver, gold and platinum. Each level, of course, requires more points, and thus will be more expensive to obtain for a property. As an investor, in order to make an informed decision, you will need to figure out what the costs will be, and what the potential return will be.
First let's discuss the potential returns. The exact numbers are going to be hard to figure out, but you can be certain that there is a definite added value to "green" products in most places across the U.S. People are generally willing to pay more for "green" products because it makes them feel good. There is also an associated status with it. The same certainly applies to housing. If people were given the choice between two comparable houses, one with LEED certification and one without, many people would choose the one with the LEED certification--and even be willing to pay more for it.
The biggest return for investors will certainly be in the marketing and desirability of their property. While it is hard to put a number on that, in today’s tough marketplace, anything that helps move a property is welcome. Because we are simply looking for the ability to market the property as LEED certified--to show that the house is “green”--it would make sense that all we would really need is to achieve is the minimum certified rating. Sure those higher rankings would be great, but they also are going to cost a lot more.
To figure out the costs, and which items make the most sense for you to take on, check out the LEED for homes rating system. Some of the items will be cheap to implement, while others will be expensive. In addition, there are some points awarded simply for a favorable location and other factors beyond the homeowner's control. Find the items that will be the cheapest to add in and work from there. Once you achieve the point total you are looking for, then you have your cost. If you want to make things easy, you can always just order a modular home, some of which are made to LEED certification standards already. If you want a custom home, or if you want to work from an existing home, you can hire a consultant to help if needed.
Looking at the numbers--which are all hypothetical, really--on the surface, LEED certification would appear to be worth the investment. When obtained in a cost efficient manner, the lowest certification level appears to be the best bet for investors in terms of return. This, of course, is assuming your property is in a market which has demand for "green" products. A simple check could be whether or not you have a Whole Foods or other similar store nearby. If there is one near you, then chances are there are a good number of environmentally and health conscious people around who would be willing to pay for a home with LEED certification.
Friday, February 8, 2008
Mitt Romney Has Dropped Out Of The Race For The Republican Nomination
Yesterday, after a disappointing showing on Super Tuesday, Mitt Romney officially dropped his bid for the Republican presidential nomination. According to The Wall Street Journal Romney was prepared to make the following statement at a political conference yesterday, “This is not an easy decision for me. I hate to lose. My family, my friends and our supporters… many of you right here in this room… have given a great deal to get me where I have a shot at becoming president. If this were only about me, I would go on. But I entered this race because I love America, and because I love America, I feel I must now stand aside, for our party and for our country.” Romney was already well behind McCain and the chances of him catching McCain were slim to none. This move is probably a wise one on behalf of Romney, and it will likely end up being helpful to his party.
The next question is whether Mike Huckabee and Ron Paul will drop out. According to The Wall Street Journal, Huckabee has no intentions of dropping out. "We're still in the race and we're still competing for delegates, and today demonstrates how long and windy to the White House this is," Chip Saltsman, Huckabee's campaign manager, said. If Huckabee really is planning to continue his run, this move by Romney should only help him as he now has one less obstacle in his way. However, he is so far back right now that things don’t look good for Huckabee.
Paul also doesn’t appear ready to throw in the towel yet, even though he trails all other nominees for delegates and has yet to win a single state. His campaign website makes it clear that his intention is to fight this battle all the way to the end, and because of his fundraising ability, he has the resources to do so. Still, the chances of Paul winning the nomination are slim. In order for that to happen, McCain would have to basically be removed from the race altogether, and unless McCain has some scandalous secret still hiding away, it probably isn’t going to happen.
It will be interesting to see how this all pans out and whether Huckabee or Paul follow Romney’s lead. After all, if they want to do what’s best for the Republican party, and if they want to have the best chance of having a Republican president, they would back out now. The more time McCain has to focus on the general election, and the more money he can raise, the better his chances. For the most part, he has already won the Republican nomination, but he can’t overlook the rest of the primaries just yet. It wouldn’t be sporting of Huckabee or Paul to just give it away anyway, and it doesn’t appear like that is going to happen.
Economic Stimulus Package Passed By Senate
Senate Democrats gave in on most of their demands yesterday and elected to pass the economic stimulus package. For a more in-depth look at the additional items the Senate Democrats wanted to include in the package, see yesterday’s blog post: Senate Delays Economic Stimulus Package.
Democrats were able to get some level of financial aid to the elderly and disabled veterans. While those groups would have received nothing under the previous bill, the new plan calls for them to receive $300, according to The Wall Street Journal. Adding these additional recipients will increase the total cost of the bill to $167 billion from $161 billion.
The speed at which the two sides were able to come together is especially impressive. In a system known for delays, they certainly got this done quickly. During this election year, it is apparent that neither side--Democrat or Republican--wants to be responsible for delaying the tax rebate checks that Americans are now expecting.
It also goes to show us how desperate Americans are for money right now, and what lengths politicians will go to in order make us think that everything is going to be okay. As I’ve stated before, this stimulus plan is destined to do nothing more than to make things worse for America, but politicians are willing to take a chance that it will delay the inevitable. At the end of the day, though, they are doing what they think is best for their re-election chances…ahem, I mean America.
Democrats were able to get some level of financial aid to the elderly and disabled veterans. While those groups would have received nothing under the previous bill, the new plan calls for them to receive $300, according to The Wall Street Journal. Adding these additional recipients will increase the total cost of the bill to $167 billion from $161 billion.
The speed at which the two sides were able to come together is especially impressive. In a system known for delays, they certainly got this done quickly. During this election year, it is apparent that neither side--Democrat or Republican--wants to be responsible for delaying the tax rebate checks that Americans are now expecting.
It also goes to show us how desperate Americans are for money right now, and what lengths politicians will go to in order make us think that everything is going to be okay. As I’ve stated before, this stimulus plan is destined to do nothing more than to make things worse for America, but politicians are willing to take a chance that it will delay the inevitable. At the end of the day, though, they are doing what they think is best for their re-election chances…ahem, I mean America.
Thursday, February 7, 2008
The Chinese New Year Has Begun: Welcome The Year Of The Rat
People who are not familiar with Chinese customs may not fully understand the importance of the Chinese New Year, but it's a huge celebration, and one which is not limited to only China and its citizens. The Chinese New Year, also known as the Lunar New Year, is a huge holiday throughout most of eastern Asia and is growing in popularity throughout much of the world.
China has more people than any other country in the world. There is also a growing number of Chinese people throughout the rest of the world. The U.S. and Canada, for example, have large Chinese populations who celebrate Chinese New Year. Many other countries in eastern Asia also celebrate this holiday, even though they are not Chinese. So now comes the question you have been waiting for: how does this impact investors?
With the growing Chinese population, and the significance of the holiday, investors should be able to see that there will certainly be investment opportunities. The opportunities, however, will likely be had by those individuals who understand the Chinese culture and how things work. If you needed another reason to get to know the Chinese culture, here you go. I personally love learning about other cultures, so this type of thing is right up my ally. If you are like me and love to experience and understand new cultures, then why not head to the nearest Chinatown and celebrate the Chinese New Year? You might discover a great new investment opportunity, or you might just have a lot of fun–you can’t go wrong either way.
The Chinese economy is growing at an astounding pace, and has been for some time. It won’t be long until China emerges as the number two economy in the world, and they may even end up overtaking the U.S. for the number one spot sometime down the road. It is my belief that learning about new cultures is never a waste of time, but if you were only going to pick one culture to learn and understand in your lifetime, the Chinese culture would probably be the best one to choose from an investment perspective. The investment opportunities stemming from this country are only going to grow, so why not get in on the front side?
NuWire published an article today about investing in Chinese real estate and last year at this time, we wrote an article about the Golden Pig baby boom in Asia. That article will give a little insight into how important the animals associated with each New Year are.
China has more people than any other country in the world. There is also a growing number of Chinese people throughout the rest of the world. The U.S. and Canada, for example, have large Chinese populations who celebrate Chinese New Year. Many other countries in eastern Asia also celebrate this holiday, even though they are not Chinese. So now comes the question you have been waiting for: how does this impact investors?
With the growing Chinese population, and the significance of the holiday, investors should be able to see that there will certainly be investment opportunities. The opportunities, however, will likely be had by those individuals who understand the Chinese culture and how things work. If you needed another reason to get to know the Chinese culture, here you go. I personally love learning about other cultures, so this type of thing is right up my ally. If you are like me and love to experience and understand new cultures, then why not head to the nearest Chinatown and celebrate the Chinese New Year? You might discover a great new investment opportunity, or you might just have a lot of fun–you can’t go wrong either way.
The Chinese economy is growing at an astounding pace, and has been for some time. It won’t be long until China emerges as the number two economy in the world, and they may even end up overtaking the U.S. for the number one spot sometime down the road. It is my belief that learning about new cultures is never a waste of time, but if you were only going to pick one culture to learn and understand in your lifetime, the Chinese culture would probably be the best one to choose from an investment perspective. The investment opportunities stemming from this country are only going to grow, so why not get in on the front side?
NuWire published an article today about investing in Chinese real estate and last year at this time, we wrote an article about the Golden Pig baby boom in Asia. That article will give a little insight into how important the animals associated with each New Year are.
Senate Delays Economic Stimulus Package
Looks like those tax rebate checks could end up coming a little later than originally expected. They might also be a little smaller. The upshot for some is that they might actually get one when they wouldn't have before. Senate Democrats have stalled the economic stimulus package in trying to add additional items to the plan. The Democrats would like to see $500 to $1000 checks, as opposed to the originally proposed $600 to $1,200 checks, and they would like to see the smaller checks sent out to a wider group of people. In the senate Democrats’ plan, the income limits would be raised to $150,000 for individuals and $300,000 for couples.
As part of the new group of tax rebate recipients, Democrats would like to see the elderly, unemployed and disabled veterans included. Overall, they want to increase the total economic stimulus package to $205 billion, up from the $161 billion bill passed in the House.
Republicans in the Senate are not too keen on the new plan and voted it down Wednesday. This means that the bill will need to be reworked on then voted on again before passing, potentially delaying the receipt of these tax rebate checks. Since neither party wants to be responsible for possible delays, the issues going on here are a bit surprising. It is likely though that one way or another, the two sides will work out the problems and the bill will pass. How it will look in its final form, though, is still open for debate.
Since I personally think this economic stimulus package is a joke that shouldn’t be passed in anything resembling the current form, I’m hoping it falls apart altogether. This scenario is highly unlikely, but I can wish for it, can’t I?
As I see it, the U.S. is trying to A) Give away money they don’t have (see budget deficit) and B) Do it in a way which will see the least amount of economic benefit. They are assuming that people are going to spend these refunds, when in reality, they will likely use them to pay down debt, or save the refunds if they are smart and don’t have any debt.
This measure will not prevent us from having a recession and is only going to put our nation further in debt. I guess when you are in as much debt as the U.S. is, though, what’s another couple hundred billion?
As part of the new group of tax rebate recipients, Democrats would like to see the elderly, unemployed and disabled veterans included. Overall, they want to increase the total economic stimulus package to $205 billion, up from the $161 billion bill passed in the House.
Republicans in the Senate are not too keen on the new plan and voted it down Wednesday. This means that the bill will need to be reworked on then voted on again before passing, potentially delaying the receipt of these tax rebate checks. Since neither party wants to be responsible for possible delays, the issues going on here are a bit surprising. It is likely though that one way or another, the two sides will work out the problems and the bill will pass. How it will look in its final form, though, is still open for debate.
Since I personally think this economic stimulus package is a joke that shouldn’t be passed in anything resembling the current form, I’m hoping it falls apart altogether. This scenario is highly unlikely, but I can wish for it, can’t I?
As I see it, the U.S. is trying to A) Give away money they don’t have (see budget deficit) and B) Do it in a way which will see the least amount of economic benefit. They are assuming that people are going to spend these refunds, when in reality, they will likely use them to pay down debt, or save the refunds if they are smart and don’t have any debt.
This measure will not prevent us from having a recession and is only going to put our nation further in debt. I guess when you are in as much debt as the U.S. is, though, what’s another couple hundred billion?
Wednesday, February 6, 2008
Investing In Silver: Is Now A Good Time?
Is this a good time to be investing in silver? This is a question many people are asking themselves right now, and for good reason. With the prices of gold and platinum going crazy and garnering all the attention, silver all of a sudden appears forgotten. Investors who look a little deeper could see that silver might have the best underlying price fundamentals of any of the precious metals.
Silver prices have a tendency to lag gold prices in the first half of gold bull market runs, according to Franklin Sanders from The Money Changer. He expects the price of gold to continue to rise, but also expects silver to play catch up as the bull run in gold progresses. He estimates that silver will eventually end up at a gold to silver price ratio of 16 to 1. With his target gold price of $1,250 per ounce, that would put silver at a target price of $78.13 per ounce. Silver is trading at a little more than $16 per ounce, so that would be an incredible return.
Sanders appears a little more bullish on silver than most, but it is hard to ignore the facts that support silver. In addition to its monetary value, silver has many industrial uses and has demand far in excess of available supply. To find out more about silver’s various attributes, read our article about investing in silver.
I don’t personally see silver hitting the target Sanders set, but I do think investing in silver is a smart investment right now. More so than gold or platinum, this is the precious metal that I think has the most room to increase in value. One interesting way to invest in silver is through a silver CD. With a silver CD, you are able to participate in the positive price movement without risking your principal. There are, of course, some drawbacks to this strategy, but it offers an overall safe route for investing in silver. For more info about this investment strategy, read our article about investing in silver and gold CDs.
Silver prices have a tendency to lag gold prices in the first half of gold bull market runs, according to Franklin Sanders from The Money Changer. He expects the price of gold to continue to rise, but also expects silver to play catch up as the bull run in gold progresses. He estimates that silver will eventually end up at a gold to silver price ratio of 16 to 1. With his target gold price of $1,250 per ounce, that would put silver at a target price of $78.13 per ounce. Silver is trading at a little more than $16 per ounce, so that would be an incredible return.
Sanders appears a little more bullish on silver than most, but it is hard to ignore the facts that support silver. In addition to its monetary value, silver has many industrial uses and has demand far in excess of available supply. To find out more about silver’s various attributes, read our article about investing in silver.
I don’t personally see silver hitting the target Sanders set, but I do think investing in silver is a smart investment right now. More so than gold or platinum, this is the precious metal that I think has the most room to increase in value. One interesting way to invest in silver is through a silver CD. With a silver CD, you are able to participate in the positive price movement without risking your principal. There are, of course, some drawbacks to this strategy, but it offers an overall safe route for investing in silver. For more info about this investment strategy, read our article about investing in silver and gold CDs.
Barack Obama Primary And Caucus Results
Barack Obama did well yesterday, although was not able to overtake Hillary Clinton. Obama actually won more states overall, but Clinton was able to capture the larger states and thus more delegates. The Democrats have three more contests this weekend and it is likely that no nominee will be declared soon. Either one of these candidates could end up with the Democratic nomination. See how Obama did state by state in the breakdown below (Delegates earned in parentheses):
Primaries
Arizona: 2nd Place (23)
Oklahoma: 2nd Place (14)
Arkansas: 2nd Place (6)
Alabama: 1st Place (21)
Connecticut: 1st Place (29)
Massachusetts: 2nd Place (43)
New Jersey: 2nd Place (38)
New York: 2nd Place (88)
Georgia: 1st Place (30)
Missouri: 1st Place (34)
Tennessee: 2nd Place (22)
Utah: 1st Place (14)
Illinois: 1st Place (81)
Delaware: 1st Place (9)
South Carolina: 1st Place (26)
New Hampshire: 2nd Place (12)
Caucuses
Minnesota: 1st Place (51)
Alaska: 1st Place (10)
Colorado: 1st Place (15)
Idaho: 1st Place (17)
Kansas: 1st Place (24)
North Dakota: 1st Place (12)
Nevada: 2nd Place (14)
Iowa: 1st Place (18)
Total Delegates: 709
*All information gathered from CNN.com
Primaries
Arizona: 2nd Place (23)
Oklahoma: 2nd Place (14)
Arkansas: 2nd Place (6)
Alabama: 1st Place (21)
Connecticut: 1st Place (29)
Massachusetts: 2nd Place (43)
New Jersey: 2nd Place (38)
New York: 2nd Place (88)
Georgia: 1st Place (30)
Missouri: 1st Place (34)
Tennessee: 2nd Place (22)
Utah: 1st Place (14)
Illinois: 1st Place (81)
Delaware: 1st Place (9)
South Carolina: 1st Place (26)
New Hampshire: 2nd Place (12)
Caucuses
Minnesota: 1st Place (51)
Alaska: 1st Place (10)
Colorado: 1st Place (15)
Idaho: 1st Place (17)
Kansas: 1st Place (24)
North Dakota: 1st Place (12)
Nevada: 2nd Place (14)
Iowa: 1st Place (18)
Total Delegates: 709
*All information gathered from CNN.com
Hillary Clinton Primary And Caucus Results
Hillary Clinton retained her status as the frontrunner with her performance on Super Tuesday. Her rival, Barack Obama, actually won more states overall, but Clinton was able to capture the larger states and thus more delegates. This race should be interesting, to say the least; either one of these candidates could end up with the Democratic nomination. See how Clinton did state by state in the breakdown below (Delegates earned in parentheses):
Primaries
Arizona: 1st Place (29)
Oklahoma: 1st Place (24)
Arkansas: 1st Place (31)
Alabama: 2nd Place (23)
Connecticut: 2nd Place (23)
Massachusetts: 1st Place (60)
New Jersey: 1st Place (61)
New York: 1st Place (166)
Georgia: 2nd Place (20)
Missouri: 2nd Place (32)
Tennessee: 1st Place (35)
Utah: 2nd Place (11)
Illinois: 2nd Place (31)
Delaware: 2nd Place (8)
South Carolina: 2nd Place (14)
New Hampshire: 1st Place (11)
Caucuses
Minnesota: 2nd Place (27)
Alaska: 2nd Place (5)
Colorado: 2nd Place (10)
Idaho: 2nd Place (3)
Kansas: 2nd Place (10)
North Dakota: 2nd Place (5)
Nevada: 1st Place (14)
Iowa: 3rd Place (18)
Total Delegates: 783
*All information gathered from CNN.com
Primaries
Arizona: 1st Place (29)
Oklahoma: 1st Place (24)
Arkansas: 1st Place (31)
Alabama: 2nd Place (23)
Connecticut: 2nd Place (23)
Massachusetts: 1st Place (60)
New Jersey: 1st Place (61)
New York: 1st Place (166)
Georgia: 2nd Place (20)
Missouri: 2nd Place (32)
Tennessee: 1st Place (35)
Utah: 2nd Place (11)
Illinois: 2nd Place (31)
Delaware: 2nd Place (8)
South Carolina: 2nd Place (14)
New Hampshire: 1st Place (11)
Caucuses
Minnesota: 2nd Place (27)
Alaska: 2nd Place (5)
Colorado: 2nd Place (10)
Idaho: 2nd Place (3)
Kansas: 2nd Place (10)
North Dakota: 2nd Place (5)
Nevada: 1st Place (14)
Iowa: 3rd Place (18)
Total Delegates: 783
*All information gathered from CNN.com
Who Won Super Tuesday?
After the single biggest day in the history of primaries in the U.S., the question on every mind is who won Super Tuesday? Which candidates are now in position to take the party nominations?
Some people are going to be elated that their candidate is now the frontrunner, while some supporters will be apprehensive if their candidate receives the frontrunner label. Still others will mourn that their candidate is now effectively out of the running. The summaries of how each candidate fared are below. For an in-depth, state by state breakdown, simply click on the candidate's name:
Democrats: Total Delegates Pledged Thus Far
Hillary Clinton: 783
Barack Obama: 709
Republican: Total Delegates Pledged Thus Far
John McCain: 559
Mitt Romney: 265
Mike Huckabee: 169
Ron Paul: 16
*All delegate information gathered from CNN.com
Some people are going to be elated that their candidate is now the frontrunner, while some supporters will be apprehensive if their candidate receives the frontrunner label. Still others will mourn that their candidate is now effectively out of the running. The summaries of how each candidate fared are below. For an in-depth, state by state breakdown, simply click on the candidate's name:
Democrats: Total Delegates Pledged Thus Far
Hillary Clinton: 783
Barack Obama: 709
Republican: Total Delegates Pledged Thus Far
John McCain: 559
Mitt Romney: 265
Mike Huckabee: 169
Ron Paul: 16
*All delegate information gathered from CNN.com
Ron Paul: Primary And Caucus Results
Ron Paul did not show well at all on Super Tuesday and is now dug into a hole out of which he won’t be able to climb. At this point there is no way Ron Paul will win the Republican nomination, which probably doesn’t surprise most people who have been observing the elections. Part of the problem is that Paul was not given the same media exposure as the other candidates, and as such, his views are unknown to most of the country. In the debates he participated in, most observers thought he performed well. That being said it, appears the only way that Paul is going to be running for president is if he abandons his party and runs as an independent. See how Paul did state by state in the breakdown below (Delegates earned in parentheses):
Primaries
Arizona: 4th Place (0)
Oklahoma: 4th Place (0)
Arkansas: 4th Place (0)
Alabama: 4th Place (0)
Connecticut: 4th Place (0)
Massachusetts: 4th Place (0)
New Jersey: 4th Place (0)
New York: 4th Place (0)
Georgia: 4th Place (0)
Missouri: 4th Place (0)
Tennessee: 4th Place (0)
Utah: 3rd Place (0)
Illinois: 4th Place (0)
Delaware: 4th Place (0)
Florida: 5th Place (0)
South Carolina: 5th Place (0)
Michigan: 4th Place (0)
New Hampshire: 5th Place (0)
Caucuses
Minnesota: 4th Place (0)
Alaska: 3rd Place (5)
Colorado: 4th Place (0)
Montana: 2nd Place (0)
North Dakota: 3rd Place (5)
West Virginia: 4th Place (0)
Maine: 3rd Place (0)
Nevada: 2nd Place (4)
Wyoming: 4th Place (0)
Iowa: 5th Place (2)
Total Delegates: 16
*All information gathered from CNN.com
Primaries
Arizona: 4th Place (0)
Oklahoma: 4th Place (0)
Arkansas: 4th Place (0)
Alabama: 4th Place (0)
Connecticut: 4th Place (0)
Massachusetts: 4th Place (0)
New Jersey: 4th Place (0)
New York: 4th Place (0)
Georgia: 4th Place (0)
Missouri: 4th Place (0)
Tennessee: 4th Place (0)
Utah: 3rd Place (0)
Illinois: 4th Place (0)
Delaware: 4th Place (0)
Florida: 5th Place (0)
South Carolina: 5th Place (0)
Michigan: 4th Place (0)
New Hampshire: 5th Place (0)
Caucuses
Minnesota: 4th Place (0)
Alaska: 3rd Place (5)
Colorado: 4th Place (0)
Montana: 2nd Place (0)
North Dakota: 3rd Place (5)
West Virginia: 4th Place (0)
Maine: 3rd Place (0)
Nevada: 2nd Place (4)
Wyoming: 4th Place (0)
Iowa: 5th Place (2)
Total Delegates: 16
*All information gathered from CNN.com
John McCain: Primary And Caucus Results
John McCain did well on Super Tuesday and has basically cemented his lead for the Republican party's presidential nomination. It appears the candidate representing the Republican party in its bid for the presidency this year will be McCain. McCain is leading in California, and with that delegate count added to his already substantial lead, Romney would need to mount a comeback of epic proportions to catch him. See how McCain did state by state in the breakdown below (Delegates earned in parentheses):
Primaries
Arizona: 1st Place (53)
Oklahoma: 1st Place (32)
Arkansas: 2nd Place (0)
Alabama: 2nd Place (13)
Connecticut: 1st Place (27)
Massachusetts: 2nd Place (17)
New Jersey: 1st Place (52)
New York: 1st Place (101)
Georgia: 2nd Place (3)
Missouri: 1st Place (58)
Tennessee: 2nd Place (15)
Utah: 2nd Place (0)
Illinois: 1st Place (55)
Delaware: 1st Place (18)
Florida: 1st Place (57)
South Carolina: 1st Place (19)
Michigan: 2nd Place (5)
New Hampshire: 1st Place (7)
Caucuses
Minnesota: 2nd Place (0)
Alaska: 4th Place (3)
Colorado: 2nd Place (0)
Montana: 3rd Place (0)
North Dakota: 2nd Place (6)
West Virginia: 3rd Place (0)
Maine: 2nd Place (1)
Nevada: 3rd Place (4)
Wyoming: 4th Place (0)
Iowa: 4th Place (3)
Total Delegates: 559
*All information gathered from CNN.com
Primaries
Arizona: 1st Place (53)
Oklahoma: 1st Place (32)
Arkansas: 2nd Place (0)
Alabama: 2nd Place (13)
Connecticut: 1st Place (27)
Massachusetts: 2nd Place (17)
New Jersey: 1st Place (52)
New York: 1st Place (101)
Georgia: 2nd Place (3)
Missouri: 1st Place (58)
Tennessee: 2nd Place (15)
Utah: 2nd Place (0)
Illinois: 1st Place (55)
Delaware: 1st Place (18)
Florida: 1st Place (57)
South Carolina: 1st Place (19)
Michigan: 2nd Place (5)
New Hampshire: 1st Place (7)
Caucuses
Minnesota: 2nd Place (0)
Alaska: 4th Place (3)
Colorado: 2nd Place (0)
Montana: 3rd Place (0)
North Dakota: 2nd Place (6)
West Virginia: 3rd Place (0)
Maine: 2nd Place (1)
Nevada: 3rd Place (4)
Wyoming: 4th Place (0)
Iowa: 4th Place (3)
Total Delegates: 559
*All information gathered from CNN.com
Mitt Romney: Primary And Caucus Results
Mitt Romney was able to keep his second place spot on Super Tuesday, but he lost a lot of ground to John McCain. It appears on the surface that the Republican nomination has all but been decided. See how Romney did state by state in the breakdown below (Delegates earned in parentheses):
Primaries
Arizona: 2nd Place (0)
Oklahoma: 3rd Place (0)
Arkansas: 3rd Place (0)
Alabama: 3rd Place (0)
Connecticut: 2nd Place (0)
Massachusetts: 1st Place (22)
New Jersey: 2nd Place (0)
New York: 2nd Place (0)
Georgia: 3rd Place (0)
Missouri: 3rd Place (0)
Tennessee: 3rd Place (9)
Utah: 1st Place (36)
Illinois: 2nd Place (3)
Delaware: 2nd Place (0)
Florida: 2nd Place (0)
South Carolina: 4th Place (5)
Michigan: 1st Place (24)
New Hampshire: 2nd Place (4)
Caucuses
Minnesota: 1st Place (38)
Alaska: 1st Place (12)
Colorado: 1st Place (22)
Montana: 1st Place (25)
North Dakota: 1st Place (8)
West Virginia: 2nd Place (1)
Maine: 1st Place (18)
Nevada: 1st Place (18)
Wyoming: 1st Place (9)
Iowa: 2nd Place (12)
Total Delegates: 265
*All information gathered from CNN.com
Primaries
Arizona: 2nd Place (0)
Oklahoma: 3rd Place (0)
Arkansas: 3rd Place (0)
Alabama: 3rd Place (0)
Connecticut: 2nd Place (0)
Massachusetts: 1st Place (22)
New Jersey: 2nd Place (0)
New York: 2nd Place (0)
Georgia: 3rd Place (0)
Missouri: 3rd Place (0)
Tennessee: 3rd Place (9)
Utah: 1st Place (36)
Illinois: 2nd Place (3)
Delaware: 2nd Place (0)
Florida: 2nd Place (0)
South Carolina: 4th Place (5)
Michigan: 1st Place (24)
New Hampshire: 2nd Place (4)
Caucuses
Minnesota: 1st Place (38)
Alaska: 1st Place (12)
Colorado: 1st Place (22)
Montana: 1st Place (25)
North Dakota: 1st Place (8)
West Virginia: 2nd Place (1)
Maine: 1st Place (18)
Nevada: 1st Place (18)
Wyoming: 1st Place (9)
Iowa: 2nd Place (12)
Total Delegates: 265
*All information gathered from CNN.com
Mike Huckabee: Primary and Caucus Results
While Mike Huckabee might have exceeded many expectations with his performance in the polls yesterday, he was not able to move past third place overall in the delegate totals leading up to the Republican nomination. He may very well be able to pass Romney, but it seems unlikely that he will catch McCain and gain the nomination. Look below to see how he has fared in each state so far (delegates earned in parentheses):
Primaries
Arizona: 3rd Place (0)
Oklahoma: 2nd Place (6)
Arkansas: 1st Place (28)
Alabama: 1st Place (14)
Connecticut: 3rd Place (0)
Massachusetts: 3rd Place (0)
New Jersey: 3rd Place (0)
New York: 3rd Place (0)
Georgia: 1st Place (25)
Missouri: 2nd Place (0)
Tennessee: 1st Place (21)
Utah: 4th Place (0)
Illinois: 3rd Place (0)
Delaware: 3rd Place (0)
Florida: 4th Place (0)
South Carolina: 2nd Place (5)
Michigan: 3rd Place (1)
New Hampshire: 3rd Place (1)
Caucuses
Minnesota: 3rd Place (0)
Alaska: 2nd Place (6)
Colorado: 3rd Place (0)
Montana: 4th Place (0)
North Dakota: 4th Place (5)
West Virginia: 1st Place (18)
Maine: 4th Place (0)
Nevada: 4th Place (2)
Wyoming: 4th Place (0)
Iowa: 1st Place (17)
Total Delegates: 169
*All information gathered from CNN.com
Primaries
Arizona: 3rd Place (0)
Oklahoma: 2nd Place (6)
Arkansas: 1st Place (28)
Alabama: 1st Place (14)
Connecticut: 3rd Place (0)
Massachusetts: 3rd Place (0)
New Jersey: 3rd Place (0)
New York: 3rd Place (0)
Georgia: 1st Place (25)
Missouri: 2nd Place (0)
Tennessee: 1st Place (21)
Utah: 4th Place (0)
Illinois: 3rd Place (0)
Delaware: 3rd Place (0)
Florida: 4th Place (0)
South Carolina: 2nd Place (5)
Michigan: 3rd Place (1)
New Hampshire: 3rd Place (1)
Caucuses
Minnesota: 3rd Place (0)
Alaska: 2nd Place (6)
Colorado: 3rd Place (0)
Montana: 4th Place (0)
North Dakota: 4th Place (5)
West Virginia: 1st Place (18)
Maine: 4th Place (0)
Nevada: 4th Place (2)
Wyoming: 4th Place (0)
Iowa: 1st Place (17)
Total Delegates: 169
*All information gathered from CNN.com
Tuesday, February 5, 2008
What Does Fat Tuesday, Or Mardi Gras, Mean To Investors?
Today is Fat Tuesday, which is the English translation of the French Mardi Gras, which marks the final day of Carnival and the last day before the start of Lent. This celebration has a long history and is celebrated in many countries across the world. I’m sure you are wondering how exactly this impacts investors, so let's get to that.
Many people might not realize how huge Fat Tuesday is or how much money these celebrations bring to local economies in areas that celebrate them. The biggest Fat Tuesday celebration in the U.S., as most people are probably aware, happens in New Orleans. Each year on Fat Tuesday--and to a lesser extent the other days of Carnival--hundreds of thousands of tourists gather in New Orleans. Last year more than 800,000 people gathered in New Orleans for Fat Tuesday. It doesn’t take a genius to realize that anytime that many people gather in one spot, there is going to be opportunity for investors.
During this time, hotels in New Orleans run near full occupancy and many locals rent out their homes--or rooms in their homes--to travelers. In addition to lodging, partiers also buy a ton of food and little trinkets (namely beads), among other things, which also spurs the local economy and businesses.
While everyone knows about New Orleans, there are some lesser-known areas that investors might be able to get in on which will see Carnival profits that investors could get in on at lower prices. Real estate prices in New Orleans have dropped substantially because of the damage caused by Hurricane Katrina. Property prices in the French Quarter are still pretty steep, though. If you are set on New Orleans, there is the potential to benefit from Go Zone investment incentives. Some other places in the U.S. that have big Fat Tuesday celebrations are Mobile, Lafayette, and St. Louis. Mobile and Lafayette also qualify for the Go Zone incentives.
In addition to U.S. destinations, there are many international places that celebrate Carnival. The Carnival celebrations in Brazil, the biggest of which happens in Rio de Janeiro, are among the most famous. Another large celebration--lesser-known than that in Brazil--happens in Montevideo, Uruguay.
There are numerous other places across the U.S. and the world that celebrate the Carnival season, and with the celebration come investment opportunities. There is plenty of profit potential in business and real estate across the board. Not only that, but it is also a lot of fun to party, especially--for me, at least--in other countries. To get a chance to experience other cultures and celebrate with them is always a great experience. So next time you go to that Fat Tuesday party, keep your eye open for investment opportunities. If that party happens to be in another country, all the better.
Many people might not realize how huge Fat Tuesday is or how much money these celebrations bring to local economies in areas that celebrate them. The biggest Fat Tuesday celebration in the U.S., as most people are probably aware, happens in New Orleans. Each year on Fat Tuesday--and to a lesser extent the other days of Carnival--hundreds of thousands of tourists gather in New Orleans. Last year more than 800,000 people gathered in New Orleans for Fat Tuesday. It doesn’t take a genius to realize that anytime that many people gather in one spot, there is going to be opportunity for investors.
During this time, hotels in New Orleans run near full occupancy and many locals rent out their homes--or rooms in their homes--to travelers. In addition to lodging, partiers also buy a ton of food and little trinkets (namely beads), among other things, which also spurs the local economy and businesses.
While everyone knows about New Orleans, there are some lesser-known areas that investors might be able to get in on which will see Carnival profits that investors could get in on at lower prices. Real estate prices in New Orleans have dropped substantially because of the damage caused by Hurricane Katrina. Property prices in the French Quarter are still pretty steep, though. If you are set on New Orleans, there is the potential to benefit from Go Zone investment incentives. Some other places in the U.S. that have big Fat Tuesday celebrations are Mobile, Lafayette, and St. Louis. Mobile and Lafayette also qualify for the Go Zone incentives.
In addition to U.S. destinations, there are many international places that celebrate Carnival. The Carnival celebrations in Brazil, the biggest of which happens in Rio de Janeiro, are among the most famous. Another large celebration--lesser-known than that in Brazil--happens in Montevideo, Uruguay.
There are numerous other places across the U.S. and the world that celebrate the Carnival season, and with the celebration come investment opportunities. There is plenty of profit potential in business and real estate across the board. Not only that, but it is also a lot of fun to party, especially--for me, at least--in other countries. To get a chance to experience other cultures and celebrate with them is always a great experience. So next time you go to that Fat Tuesday party, keep your eye open for investment opportunities. If that party happens to be in another country, all the better.
Super Tuesday Has Arrived: Vote For Your Favorite Presidential Candidate
More than 20 states are holding their primaries today which makes today, Super Tuesday, the single biggest day for primaries in U.S. election history. If you are not sure when your state’s primary is, take a look at this chart, courtesy of the Boston Globe.
On the Republican side, the race is down to John McCain, Mitt Romney, Ron Paul and Mike Huckabee. While McCain and Romney are running a pretty tight race right now, and almost everyone thinks one of those two will end up winning the Republican Party nomination, I feel that it is important to support the candidate you truly like best. If you simply vote for the candidate that you think is going to win, you aren’t doing your party or yourself any service. It is sad to me that so many people go this route; they simply think (or someone else tells them) their candidate is out of it and either they don’t vote at all or they end up going along with the crowd. The whole reason we have this election system is so people can have their voices heard, so get out there and support your favorite candidate, not your friend’s or your neighbor’s. If you really like Huckabee or Paul, get out there and vote for your candidate!
Now that I’m off my soap box, as most people are already aware, the Democratic nomination is now down to two candidates, Hillary Clinton and Barack Obama. While Clinton has the lead by most measures, many polls show Obama closing the gap recently. The race is close and either candidate could very well pull a victory out. The race between Clinton and Obama is so competitive that it would not be surprising if the Democratic presidential nominee was not decided after today's results have been tallied.
If you were wondering about how the candidate’s budget proposals stack up, check out yesterday’s blog post: Presidential Candidate Budget Analysis: Ron Paul Lowest, Barack Obama Highest In New Spending.
For more background into the candidates economic policies that could impact investors click on your favorite candidate below:
Barack Obama
Hillary Clinton
Mitt Romney
Ron Paul & Ron Paul And The Fight To Save The U.S. Dollar
John McCain
Mike Huckabee
On the Republican side, the race is down to John McCain, Mitt Romney, Ron Paul and Mike Huckabee. While McCain and Romney are running a pretty tight race right now, and almost everyone thinks one of those two will end up winning the Republican Party nomination, I feel that it is important to support the candidate you truly like best. If you simply vote for the candidate that you think is going to win, you aren’t doing your party or yourself any service. It is sad to me that so many people go this route; they simply think (or someone else tells them) their candidate is out of it and either they don’t vote at all or they end up going along with the crowd. The whole reason we have this election system is so people can have their voices heard, so get out there and support your favorite candidate, not your friend’s or your neighbor’s. If you really like Huckabee or Paul, get out there and vote for your candidate!
Now that I’m off my soap box, as most people are already aware, the Democratic nomination is now down to two candidates, Hillary Clinton and Barack Obama. While Clinton has the lead by most measures, many polls show Obama closing the gap recently. The race is close and either candidate could very well pull a victory out. The race between Clinton and Obama is so competitive that it would not be surprising if the Democratic presidential nominee was not decided after today's results have been tallied.
If you were wondering about how the candidate’s budget proposals stack up, check out yesterday’s blog post: Presidential Candidate Budget Analysis: Ron Paul Lowest, Barack Obama Highest In New Spending.
For more background into the candidates economic policies that could impact investors click on your favorite candidate below:
Barack Obama
Hillary Clinton
Mitt Romney
Ron Paul & Ron Paul And The Fight To Save The U.S. Dollar
John McCain
Mike Huckabee
Monday, February 4, 2008
Presidential Candidate Budget Analysis: Ron Paul Lowest, Barack Obama Highest In New Spending
Ron Paul came in at -$150.1 billion and Barack Obama at $287 billion for new spending proposals in a 2008 Presidential Candidate Budget Analysis put together by the National Taxpayers Union Foundation, representing the lowest and highest numbers, respectively, of all the candidates. These numbers represent new spending programs the candidates are proposing the government take on if they are elected president. Obviously there is quite a difference in spending between the two ends of the spectrum in Paul and Obama, but what where do the rest of the candidates sit?
From highest to lowest, Hillary Clinton came in second after Obama, proposing $218.2 billion in new spending. Following Clinton is Mike Huckabee at $54.2 billion, Mitt Romney at $19.5 billion and John McCain at $6.9 billion. The only candidate other than Ron Paul who was proposing an overall spending cut was Rudy Giuliani, at -$1.4 billion; however, he recently dropped out of the race and has endorsed McCain.
Each of the Democratic candidates came in with large new spending proposals, largely because of the health care reforms they wish to see enacted. Both Clinton and Obama are proposing to get rid of the Bush tax cuts, which they hope will work toward offsetting their spending increases. Cutting the Bush tax cuts alone, however, will not come close to meeting their spending increases. This means in order for the candidates to enact their policies, they will need to make additional cuts elsewhere, increase tax income or increase the government’s deficit. This same assessment goes for the Republican candidates who are proposing spending increases. None of them are campaigning for increased taxes, though.
The big day--Super Tuesday--is tomorrow, so if you happen to reside in one of the more than 20 states holding their primaries tomorrow, get ready to vote. Look over some of our archived posts (January) for more insight into each candidate.
From highest to lowest, Hillary Clinton came in second after Obama, proposing $218.2 billion in new spending. Following Clinton is Mike Huckabee at $54.2 billion, Mitt Romney at $19.5 billion and John McCain at $6.9 billion. The only candidate other than Ron Paul who was proposing an overall spending cut was Rudy Giuliani, at -$1.4 billion; however, he recently dropped out of the race and has endorsed McCain.
Each of the Democratic candidates came in with large new spending proposals, largely because of the health care reforms they wish to see enacted. Both Clinton and Obama are proposing to get rid of the Bush tax cuts, which they hope will work toward offsetting their spending increases. Cutting the Bush tax cuts alone, however, will not come close to meeting their spending increases. This means in order for the candidates to enact their policies, they will need to make additional cuts elsewhere, increase tax income or increase the government’s deficit. This same assessment goes for the Republican candidates who are proposing spending increases. None of them are campaigning for increased taxes, though.
The big day--Super Tuesday--is tomorrow, so if you happen to reside in one of the more than 20 states holding their primaries tomorrow, get ready to vote. Look over some of our archived posts (January) for more insight into each candidate.
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