Halloween Candy—A Leading Economic Indicator
Posted on | November 1, 2011 | No Comments
Is there a correlation between the type of candy doled out and the health of the local economy? I’m sure there is research out there. The results from the empirical evidence I gathered as a kid indicated that in order to haul in the premium candy (Hershey’s chocolates vs Tootsie rolls, for example) one had to venture out to the wealthier neighborhoods. An additional benefit was that it was safer but it also decreased the creepiness/scary(dangerous) factor Halloween stands for. Houses were farther apart so it required more walking. In the end one would come home with less candy but it would be higher quality.
Some interesting statistics regarding Halloween in 2011 from here and here.
- $2.3 billion worth of candy will be distributed this Halloween. That is up 1% from last year. Is the economy slightly better than last year?
- I was surprised to learn that the average jack-o’-lantern holds 250 pieces of candy which amounts to 3 lbs of sugar. I don’t think I ever came close to getting that many pieces.
And for a truly scary statistic:
- The Census bureau says the average American consumes 25 pounds of candy a year. Yikes!
How did your kids do? How would you guess the homeowners are doing in the neighborhoods you visited? Are real estate prices going up, down or staying steady?
Potential Restitution From an Improper Foreclosure
Posted on | October 28, 2011 | No Comments
Wikipedia defines Foreclosure as “the legal process by which a mortgage lender (mortgagee), or other lien holder, obtains a termination of a mortgage borrower (mortgagor)’s equitable right of redemption, either by court order or by operation of law (after following a specific statutory procedure).”
Millions of homeowners went through this process in 2009 and 2010. Some servicers cut corners and didn’t follow the legal process and restitution may be in order for those homeowners.
Why?
The reviews are part of a larger enforcement action taken against 14 large mortgage servicers last April by the OCC, the Federal Reserve and Office of Thrift Supervision in the wake of the “robo-signing” scandal.
Mistakes eligible for restitution include:
•Paid impermissible fees or penalties.
•Paid too much or had payments misapplied.
•Were wrongly denied loan modifications.
•Were wrongly foreclosed upon.
Are you eligible?
The reviews cover homeowners in any stage of the foreclosure process on a primary home in 2009 or 2010. Anyone who meets that requirement — and was a customer of one of the 14 servicers — will get a review if they ask. The servicers include: Bank of America, Citibank, JPMorgan Chase, Wells Fargo, Ally Financial, Aurora Bank, EverBank Financial, HSBC, MetLife, OneWest, PNC, Sovereign Bank, SunTrust Banks and U.S. Bancorp.
Cost?
The reviews are completely free for all eligible borrowers. Consumers should beware of anyone requesting to be paid for this service or who claims they can influence the outcome of the review.
When?
Check your mailbox in the next few weeks. You’ll receive a notice in the mail indicating your right to seek a review. If you don’t receive a notice but feel you are eligible, you may visit http://independentforeclosurereview.com/ for more information about the review process. Assistance is also available at 1-888-952-9105.
More information available here and here.
2012 Tax Benefits to Increase Due to Inflation
Posted on | October 21, 2011 | No Comments
The IRS has just announced Cost of Living Adjustments to various items for tax year 2012. Of interest to a lot of people should be the increase to 401(k) from $16,500 to $17,000—an increase of $500. I’m still not at the max for this year. Deducting $708.33 a pay check would be way too much for me. I suppose if I got a really big pay raise in the near future I might be able to contribute more. My priority is still to set aside enough income in my 401(k) to maximize the employer match, contribute the full amount to my HSA ($3,050), fund my Roth IRA ($5,000) and then add more to my 401(k). Below are some other adjustments that might be of interest to many readers.
- The AGI limit for the saver’s credit (also known as the retirement savings contributions credit) for low-and moderate-income workers is $57,500 for married couples filing jointly, up from $56,500 in 2011; $43,125 for heads of household, up from $42,375; and $28,750 for married individuals filing separately and for singles, up from $28,250
- The AGI phase-out range for taxpayers making contributions to a Roth IRA is $173,000 to $183,000 for married couples filing jointly, up from $169,000 to $179,000 in 2011. For singles and heads of household, the income phase-out range is $110,000 to $125,000, up from $107,000 to $122,000. For a married individual filing a separate return who is covered by a retirement plan at work, the phase-out range remains $0 to $10,000.
- The deduction for taxpayers making contributions to a traditional IRA is phased out for singles and heads of household who are covered by a workplace retirement plan and have modified adjusted gross incomes (AGI) between $58,000 and $68,000, up from $56,000 and $66,000 in 2011. For married couples filing jointly, in which the spouse who makes the IRA contribution is covered by a workplace retirement plan, the income phase-out range is $92,000 to $112,000, up from $90,000 to $110,000. For an IRA contributor who is not covered by a workplace retirement plan and is married to someone who is covered, the deduction is phased out if the couple’s income is between $173,000 and $183,000, up from $169,000 and $179,000.
- For 2012, contributions to an employee’s SEP-IRA cannot exceed the lesser of: 25% of the employee’s compensation or $50,000.
RIP Steve Jobs
Posted on | October 5, 2011 | No Comments
I just saw this headline: Steven P. Jobs, Co-Founder of Apple, Dies.
Apple has updated their site as well: http://www.apple.com/stevejobs/
If you would like to share your thoughts, memories, and condolences, please email rememberingsteve@apple.com
R.E.M. Calling it Quits After 31 Years
Posted on | September 22, 2011 | No Comments
I’ve was a big fan of R.E.M. for many years. I’m a bit saddened that they are calling it quits. My favorite albums are probably “Green”, “Automatic for the People” and “Out of Time.” I stopped listening to their new music after the release of their album titled “Monster.” They released numerous hits over the years. I don’t think I’ll ever get tired of listening to their music. Coincidentally, one of my all time favorite songs is titled “Photograph.” It was a song that Michael Stipe and Natalie Merchant performed together.
31 years is a very long time for a band to stay together. I hope I’ll be employable for that many years. Michael Stipe’s networth is estimated to be at least $75 million. Between their savings and their residual income from their music they should be fine financially. I’m sure they’ll continue their political and social activism for many years to come.
Microsoft Increases Dividend by 25%!
Posted on | September 20, 2011 | No Comments
Dividend seeking investors may want to take another look at Microsoft Corp. The stock price has been stuck in a narrow trading range for several years now. However, in an effort to boost the stock price, the board of directors has just announced their decision to increase the quarterly dividend to 20 cents a share. This is a 25% increase. At the closing price of $26.98 a share the yield is just below 3%. Although I don’t agree with their decision to spend $40 billion to buy back their stock (I think it should be spent on dividends instead), they still produce plenty of cash.
Besides the Kinect, the xbox 360 add-on that has been big hit with consumers, Microsoft will also be releasing a new version of windows 8 for PCs and a variant for mobile phones. I’ve started to see positive reviews on the new operating system.
Although, I am continuing to hold on to the shares, I’m also trying set up covered calls to earn a little more meager income from my investment.
So, if you invest in dividend stocks you should consider buying MSFT before Nov 15 when it will begin trading ex-dividend. The dividend will be payable to shareholders of record on Nov 17th, 2011. The dividend will be paid on Dec 8, 2011 so you’ll have an extra few bucks to spend on Christmas gifts this year!
Congressman Fleming Emulating Latrell Sprewell
Posted on | September 19, 2011 | No Comments
I follow basketball more than the average person. Sadly, I think most people who have heard of Latrell Sprewell will only remember him because of the following statement he made in the midst of contract negotiations:
I doubt anyone gave him much sympathy. You can do the math. I’m pretty sure anyone with that kind of contract would have more than enough to feed his three children for many years.
I stand corrected though. Apparently, the Republican Party is very sympathetic to his plight. In fact, after Obama unveiled his Plan for Economic Growth and Deficit Reduction today, Congressman John Fleming said on MSNBC that he needed $200,000 a year just to feed his family and could not afford to pay any more in taxes. Watch for yourself below.
As a congressman, I don’t think he has time to be too involved in the day to day activities of his medical practice or other businesses. The businesses are basically generating passive income for him. He also receives $174,000 in salary as a congressman and all the benefits that holding public office affords him. Is he really this out of touch? How does he think his constituents that don’t earn at least $600,000 annually feed their families? What I’d really like to know is how he can pay 500 people on $6.2 million in revenue. Something isn’t adding up or he has a lot of part-time workers to avoid paying benefits. Although, Louisiana doesn’t have a minimum wage so they must follow the federal minimum wage. How do his employees have enough money to feed their families?
40 Million in 16 Months
Posted on | September 18, 2011 | No Comments
I did not tune in to see the fight last night between “Money” Floyd Mayweather Jr. and Victor Ortiz. I did see a summary of the results though. Mayweather is expected to make at least $40 million on this fight. At age 34, he is still unbeaten. Yesterday’s k.o. was a little dubious though. He came out strong in the first 3 quarters and finished Ortiz off in the fourth quarter after getting a head-butt, a hug and a kiss from him. Anyway the real story is that Mayweather is at the top of his game right now and is able to capitalize on his boxing matches!
Additionally, given that he owns 29 cars I’m sure a significant amount of his money will get spent further stimulating our economy! Keep up the good work Mayweather!
UBS Trader Loses $2.3 Billion
Posted on | September 17, 2011 | No Comments
Trading is risky, sometimes you lose, sometimes you win and in some cases you end up in jail. Like, Jerome Kerviel who was sentenced to 3 years in prison and asked to repay the $6.8 billion loss, Kweku Adoboli was also arrested for trading losses. UBS reported that the fraud has taken place for the last three years. Both of these individuals were 31 when the alleged trading was discovered and both worked on trading desks called delta-one. Their jobs were to buy shares and then hedge those bets and exploit price differences. He was apparently doing quite well in his career and able to command a 7 figure salary.
I find it very difficult to believe that UBS did not know about the trading. I also believe that if the trade had gone his way he’d be a hero.
Using Dividends to Pay Down Debt
Posted on | September 13, 2011 | No Comments
I really enjoy receiving Dividends! Every month, as I send my dividends to creditors to pay off my debt, I’m reminded of the following dilemma: Is it better to pay down debt or invest the money and hope for a better return?
According to wikinvest, my portfolio is averaging 3.6% return in dividends alone. After taxes, I’m probably earning about 2.7%. My car loan is at 5.79%. I expect my portfolio to increase in value at least 3% annually long-term. Although, the last few months have been a different story. So, i’ve decided that it makes sense for me to stay invested. I’ve stopped using automatic dividend reinvestment and instead would rather choose when and what to buy with the dividends I receive. Depending on the current market conditions and stock prices I might just leave them in cash too.
| 09/08/11 | MSFT | 32 |
| 09/02/11 | BA | 10.5 |
| 08/31/11 | NAT | 0.04 |
| 08/30/11 | HCBK | 16 |
| 08/26/11 | C | 0.65 |
| 08/26/11 | Money Market | 0.03 |
| 08/23/11 | FNFG | 32 |
This month I’ll be sending $91.22.
Currently, I do not have a position in HCBK or NAT. I sold HCBK after it went Ex-dividend. I’m clinging to residual shares of NAT from a few years ago. I am long MSFT, C, FNFG, BA.
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