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Rapturonomics

by @ 3:52 pm
Filed under: money,religion — Tags: ,

Well, the May 21, 2011 rapture didn't happen. No judgments, no earthquakes, no zombies, and no Jesus. A bunch of blokes got "caught up" in the frenzy and wasted time and money, but economically speaking, the bogus prediction might have had a positive effect after all. Here's a short list of the favorable impacts of rapturonomics:

- It didn't happen on a workday, so no wasted company time checking websites for earthquakes and body-snatching news.

- Family radio and its affiliates paid a lot of advertising money to various outlets to get the message out. Making billboards, radio ads, stickers and placards, and printed literature create all sorts of primary and secondary jobs.

- Media companies covering the (non-)event relied on their employees to produce and broadcast the news. Those are real jobs.

- A variety of businesses for post-rapture services ranging from pet care to message delivery got positive attention.

- There were all kinds of rapture memorabilia sales, like t-shirts, mugs, and buttons.

- Rapture parties gave a nice boost to bars and beer companies.

See? That's not so bad. It's only doomsday if you treat it that way. And it turned out to be good for the economy. We should have a rapturonomics day every year. It'll blow away the cheesy independence day sales events 🙂

The Mystery Chart

by @ 8:20 pm
Filed under: financial,money — Tags: , ,

Quick, when you look at this chart what's the first thought that pops into your head?


Courtesy Wikipedia

A crashing stock? Dwindling numbers of an endangered species? An almost eradicated disease? Whatever it appears as to you, it's pretty sobering and alarming.

Let's not keep you guessing any longer. It's the value of the US dollar versus the Japanese yen for the last 6 decades. To all those who think the news of the dollar's demise is greatly exaggerated, think again. Does this look like a healthy currency to you? Mind you, Japan isn't exactly firing on all cylinders either.

The US deficit and national debt must be addressed soon and hard choices must be made. Enough wait-and-see already.

Amazon.com and Pedophilia

by @ 9:09 pm
Filed under: law,money — Tags: ,

amazonFirst amazon.com accepts a book that apparently promotes, or at least condones, pedophilia (I haven't read the book, nor do I plan to). Then basks in the publicity as complaints begin to pour in and the media covers the story ad-nauseum. Then it stokes the flames more by hiding behind the first amendment, realizing that it will drum up even more business. Finally when the calls for boycotting start to get louder, it silently removes the title from its site, and it refuses to answer any questions about its decision.

So which is it, amazon? Did you suddenly decide to violate the first amendment rights of the author and yank the title? Or did you decide to be a moral corporate citizen? The answer: none of the above. Just a hypocritical company riding the wave of publicity and doing the right thing only when profits are in jeopardy. It's anything for a buck, even instructions on child abuse.

Disclaimer: I have a gripe against amazon.com for unjustly accusing me of wrong-doing.

Gold Keeps Rising

by @ 12:07 am
Filed under: financial,money — Tags: ,

goldIt seems like there's no way of stopping gold from its upward march. Even with the stronger dollar today, gold surpassed $1,410 an once, setting a new price record.

Clearly the market is nervous about the world economy and the dollar's viability, so it keeps pouring money into gold. As with everything else, at some point, if not already, gold will become a bubble and it will crash. Of course that threshold is unknown, it could be next week or next year. It could start deflating now or it may continue to $2,000 an ounce before it implodes.

Right now, as things appear, gold seems to be a safe bet, so chances are that it will keep on climbing. But beyond $1,500, it could be considered over-bought and the risk of collapse becomes a real concern.

Rocking Warren Buffett

by @ 10:03 pm
Filed under: money — Tags:

This one is a couple of months old but I just stumbled on it and it left me pretty speechless.

Now I already admire Warren Buffett, not for being loaded, but for having such a high modesty to wealth ratio and for his ultra-generous spirit. This clip made me admire him even more. He must be the coolest grandpa ever. Ok, after Mick Jagger 🙂

0% Balance Transfer? Not Quite

by @ 11:20 pm
Filed under: money — Tags: , ,

0-percentThey're back from their welcome hiatus. I've already received a couple of offers to open credit card and bank card accounts with full year 0% interest on balance transfers. Why is it that you only get these great offers when you need them the least? But I digress, and on second look they're not great offers after all.

The difference between these 0% offers and those of the credit-giddy past is that there's now a 5% or higher transfer fee attached. So let's see, the interest is 0% but there's a 5% upfront fee. Isn't that the same as charging a 5% interest rate for the first year? In fact this is worse because it's piled on in advance and people are stuck with the fee no matter how fast they pay off the loan.

The marketing gimmicks never cease. I'm sure a bunch of people have already applied for the phantom 0% accounts.

Stock Market Rally, Euro

by @ 10:25 pm
Filed under: financial,money — Tags: , , ,

euroWe knew it was coming, but I didn't expect the Europeans to pull off a rescue plan as early and as boldly as they did. Good for them and good for the markets which responded in kind by rocketing up today around the globe. Banking shares, specially the battered European ones, like ING, were on fire today.

Now we know that Europe means business defending its currency, the euro. The real test however will be in the coming days and weeks as the euphoria and wishful thinking subsides and reality is back to being front and center. Will the storm become a faint memory, or will this so called contagion return with a vengeance. We will see what we will see.

Dollar Rally

by @ 11:49 pm
Filed under: financial,money — Tags: , , ,

The last time the euro was below $1.30 USD was over a year ago. It's below $1.30 once again. This despite the fact that the consensus had been for the US dollar to continue to be under pressure and see further declines. The fundamentals in the US haven't really changed much. There's still a monster-sized deficit and growing and there's even talk about the US spending all its income servicing debt in a few short years.

What's changed is the financial fiasco unraveling in Greece and gripping Europe by proxy. That has the investors scurrying and flying to the US dollar. It's a short term relief for the dollar where in normal conditions (in my opinion) should be trading at parity with the euro.

For now the market is nervous because it doesn't know how deep the rabbit hole in Europe goes and as usual the governments aren't saying much, lest they spook the markets even more. That has opened a short-term advantage for the dollar.

But my feeling is that the favorable period for the dollar will soon pass as Europe bites the bullet and faces the issue head-on, instead of wavering and hoping that the situation will correct itself. If the US hasn't addressed its deficit issue by then (and I see no evidence of that), the dollar will resume its slide and who knows how far the American rabbit hole will go.

Credit Card Interest Rate Games

by @ 11:55 pm
Filed under: financial,money

Credit CardsCitibank MasterCard - for me it started years ago like many others. The 0% offer in the mail and the 1% cashback, and I was in the game. Fast-forward a few years and the cashback is still there but I just received a notice that the interest rate on the card will soon be 23.99%. It hasn't happened abruptly. First it was 5%, then 9%, then 13%, then 17%, then 20%, and now 24%. What is it with the 0.99%? Do they think that consumers are stupid?

Ok, I'm not exactly a profitable customer for these guys. I never carry a balance. Yes, they make a marginal profit from merchant charges, of which they return 1% back to me, and who knows how long that's going to last. But with new consumer protection laws looming the banks have just gone wild, hiking fees and charges and interests all over the map. Why stop at 24%? Why not 50% or 100% or even 10,000%?

But wait, it gets even better. The letter states that if the account is in good standing and there are $1,500 or more in monthly charges, they'll credit 10% of the total interest for the given month. "This can offset the increase in your purchase APR.", the letter states. How kind of the bank to make this generous offer.

First of all, the naïve customer may think that the bank will drop the interest rate from 24% to 14% - hardly. That's 10% of the 24%, for the grand total of 2.4% in credits. In other words the interest rate will be 21.6%. Second, who has the time to spread out the charges every month in a precise manner to take advantage of the credit? Third, who is going to make certain that the bank is actually abiding by this rule? I'm sure the rules are so complex that the bank will never have to honor the credit. And last, as stated in the letter, "We reserve the right to change or end this program with 30 days' prior written notice." In other words, good luck getting a dime back.

There are some who advocate ditching credit cards altogether and paying everything with cash instead. It's a great idea on the surface, but hardly practical. The banks have rigged the system so well that a cash-only lifestyle in the modern world is all but impossible. Try to book a flight, rent a car, reserve a hotel room, or shop online and you'll be running back to the credit card with your tail between your legs. Use a debit card? Good luck getting your money back when a hacker empties your bank account and vanishes into the ether.

For now the only thing you can do is to use the credit card sparingly, pay off your balances every month, and just try to stay one step ahead of the banks as they continue to change the rules of the game in the hopes of tripping you up.

,,,

Credit Card Foreign Transaction Fees

by @ 10:02 pm
Filed under: money

This is probably old news to some but it came as a surprise to me. As I have done so for many years, I booked a flight online with a foreign carrier with offices in the US and made a credit card payment in US Dollars. About a month later I got slapped with an unexplained foreign transaction fee. After some inquiry I was told that my credit card was charged in an overseas location, probably the airline's headquarters in their native country, and per new rules I had to pay this fee even though the amount charged was in US Dollars.

Credit card companies have gotten real sneaky with their fees these days. In today's global economy when you make a purchase using a credit card, you can't be sure where, geographically speaking, your card may be charged. In my case, the order was probably routed to the carrier's datacenter in their native country. In past this was of no consequence as long as the amount was in US Dollars. But now the greedy credit card companies have decided to tack on additional fees for these cases.

Something to be careful about the next time you make a purchase. The price you pay may not be the final price. What's next? Charging fees if you use your card outside your hometown? Seems silly, but nothing is beyond these shady companies when it comes to helping themselves to your hard-earned money. So much for the consumer protection laws.

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