I'm at the Phoenix airport waiting for my flight home after my seminar and thought I'd comment on some things I've seen about what the banks are doing with the money they got from the $700 Billion Bailout.
I had CNN on in my room the other night and a banner went by indicating how much in bonuses was going to be paid by several of the banks. Huh? Bonuses for messing up? And these were BIG numbers. I searched the internet and couldn't find any more information, even at CNN.
Then last night they were talking about how one of the banks used some of the money to buy another bank (probably one in trouble, right?). The question in my mind is why there were not more caveats attached to the use of the bailout money. I understand that we don't want the government running private banks, but come on, giving banks huge amounts of taxpayer's money and not putting restrictions on what they can use it for (I understand they did limit "golden parachutes," but I'm not sure to what extent) doesn't make sense to me. This was supposed to be for our benefit in some way, wasn't it? If they use the money in ways that don't directly benefit us who's to say the same people who mucked things up won't make poor decisions with this money?
Let me be the first to say I'm not well-read on the provisions in the Bailout Bill, and if someone is able to comment from a more well-read position, please do.
10/26/2008
Do You Need a Website? Try This and Create One in 30 Minutes
When I first wanted to create a website for a new business I was starting I didn't have the money to get someone else to do it for me. So I went looking for software that I could use to do it myself. I looked at a lot of recommendations, but they just seemed more complicated than I needed and I'd have to spend a bunch of time learning the software.
Then I happened upon the software I'm currently using. Its advertising said I could create a site in just 30 minutes...and they were right! I was very surprised at how easy it was. A little learning curve, but it was pretty much "point and shoot." So if you're looking for a great website creation tool give it a try. It's easy and even better, it's very inexpensive as well! Can't get better than easy and inexpensive!
Click on the following and check it out.
Then I happened upon the software I'm currently using. Its advertising said I could create a site in just 30 minutes...and they were right! I was very surprised at how easy it was. A little learning curve, but it was pretty much "point and shoot." So if you're looking for a great website creation tool give it a try. It's easy and even better, it's very inexpensive as well! Can't get better than easy and inexpensive!
Click on the following and check it out.
I saw a banner go by on the bottom of the screen on CNN a little while ago that floored me. So I tried to find the full story. And, interestingly, I had a difficult time tracking it down. Considering the subject matter I was amazed that it wasn't being talked about on the news.
Saturday, October 25, 2008 7:32 AM EDT
By the Associated Press
NEW YORK — Despite the Wall Street meltdown, the nation's biggest banks are preparing to pay their workers as much as last year or more, including bonuses tied to personal and company performance.
So far this year, nine of the largest U.S. banks, including some that have cut thousands of jobs, have seen total costs for salaries, benefits and bonuses grow by an average of 3 percent from a year ago, according to an Associated Press review.
"Taxpayers have lost their life savings, and now they are being asked to bail out corporations," New York Attorney General Andrew Cuomo said of the AP findings. "It's adding insult to injury to continue to pay outsized bonuses and exorbitant compensation."
Banks will decide what to pay out in bonuses in the coming months. Just because they've been accruing money for incentive pay doesn't mean they will pay it out in full.
But some banks are setting aside large amounts. At Citigroup, which has cut 23,000 jobs this year amid the crisis, pay expenses for the first nine months of this year came to $25.9 billion, 4 percent more than the same period last year.
Even if what the bank has shelled out in severance pay and other costs related to the job cuts are subtracted, overall pay is only slightly lower this year.
Typically, about 60 percent of Wall Street pay goes to salary and benefits, while about 40 percent goes to end-of-the-year cash and stock bonuses that hinge on performance, both for the individual and the company, said Brad Hintz, a securities industry analyst at Sanford Bernstein and a former chief financial officer at Lehman Brothers.
This should be the year where that structure is tested. The financial crisis, brought about by mountains of bad mortgage-related assets, caused banks to falter or fail and lending to dry up and prompted Congress to pass a $700 billion bailout package. As part of that, government is pouring $125 billion through stock purchases into the nine large financial companies cited in AP's review of compensation.
Besides Citigroup, those include Bank of New York Mellon, Goldman Sachs, Morgan Stanley, JPMorgan Chase, Bank of America, Merrill Lynch, Wells Fargo & Co., and State Street. Another $125 billion will be made available to other banks.
Those taking cash from Uncle Sam must follow guidelines limiting executive pay, including a ban on golden parachutes for departing executives. No restrictions are placed on across-the-board pay.
Saturday, October 25, 2008 7:32 AM EDT
By the Associated Press
NEW YORK — Despite the Wall Street meltdown, the nation's biggest banks are preparing to pay their workers as much as last year or more, including bonuses tied to personal and company performance.
So far this year, nine of the largest U.S. banks, including some that have cut thousands of jobs, have seen total costs for salaries, benefits and bonuses grow by an average of 3 percent from a year ago, according to an Associated Press review.
"Taxpayers have lost their life savings, and now they are being asked to bail out corporations," New York Attorney General Andrew Cuomo said of the AP findings. "It's adding insult to injury to continue to pay outsized bonuses and exorbitant compensation."
Banks will decide what to pay out in bonuses in the coming months. Just because they've been accruing money for incentive pay doesn't mean they will pay it out in full.
But some banks are setting aside large amounts. At Citigroup, which has cut 23,000 jobs this year amid the crisis, pay expenses for the first nine months of this year came to $25.9 billion, 4 percent more than the same period last year.
Even if what the bank has shelled out in severance pay and other costs related to the job cuts are subtracted, overall pay is only slightly lower this year.
Typically, about 60 percent of Wall Street pay goes to salary and benefits, while about 40 percent goes to end-of-the-year cash and stock bonuses that hinge on performance, both for the individual and the company, said Brad Hintz, a securities industry analyst at Sanford Bernstein and a former chief financial officer at Lehman Brothers.
This should be the year where that structure is tested. The financial crisis, brought about by mountains of bad mortgage-related assets, caused banks to falter or fail and lending to dry up and prompted Congress to pass a $700 billion bailout package. As part of that, government is pouring $125 billion through stock purchases into the nine large financial companies cited in AP's review of compensation.
Besides Citigroup, those include Bank of New York Mellon, Goldman Sachs, Morgan Stanley, JPMorgan Chase, Bank of America, Merrill Lynch, Wells Fargo & Co., and State Street. Another $125 billion will be made available to other banks.
Those taking cash from Uncle Sam must follow guidelines limiting executive pay, including a ban on golden parachutes for departing executives. No restrictions are placed on across-the-board pay.
IndyMac Bank and BofA are Modifying Mortgage Payments - Can It Help You?
I read an article on CNN Online that talks about the mortgage modifications that IndyMac and BofA are doing - if you have a mortgage with either you should read the article, you may be able to get help on your mortgage payment. Here is a portion of the article; read the full article at http://money.cnn.com/2008/10/24/real_estate/indymac_solution/index.htm?postversion=2008102416
One failed bank gets the housing fix right
When the FDIC seized mortgage giant IndyMac it was one of the biggest bank failures ever. Now the troubled lender just may lead us out of the housing mess.
By Amanda Gengler, Money Magazine writer
"Under IndyMac's program, the lender modifies a loan so that the borrower's new mortgage payment, including insurance and taxes, eats up no more than 38% of their pre-tax income. This percentage, known as a debt to income ratio, topped 50% for some loans during the boom.
To achieve this lower payment, IndyMac can lower the interest rate, extend the life of the loan to, say, 30 or 40 years, defer some principal to the final years of the loan, or a use a combination of these strategies.
IndyMac is also trying to simplify the process for borrowers. It is overnighting loan forms to eligible customers with a signature required upon receipt. "It doesn't show up with your regular mail, coupons and junk mail, because the key is getting the consumer to open it," said FDIC spokesman David Barr.
The papers clearly spell out a borrower's new loan terms, including the interest rate and monthly payments over the life of the loan. The borrower simply signs and returns the documents with the first lower monthly payment.
B of A follows suit
Bank of America (BAC, Fortune 500) launched a similarly systematic program earlier in October. That program, scheduled to start in December, came as part of a settlement with state attorney general offices that sued Countrywide, which B of A recently acquired, for predatory lending practices. It's expected to help 400,000 troubled borrowers and is actually slightly more aggressive than IndyMac's plan.
B of A will use a 34% debt-to-income ratio to calculate the affordable monthly payment for its customers, and may also write down the principal balance of some negative amortizing loans. IndyMac will not forgive debt, but instead will add principal to the final years of a loan if necessary.
Additionally, IndyMac's program is now being applied to many delinquent loans owned by Freddie Mac (FRE, Fortune 500), Fannie Mae (FNM, Fortune 500) and other investors, Bair said in her testimony Thursday."
One failed bank gets the housing fix right
When the FDIC seized mortgage giant IndyMac it was one of the biggest bank failures ever. Now the troubled lender just may lead us out of the housing mess.
By Amanda Gengler, Money Magazine writer
"Under IndyMac's program, the lender modifies a loan so that the borrower's new mortgage payment, including insurance and taxes, eats up no more than 38% of their pre-tax income. This percentage, known as a debt to income ratio, topped 50% for some loans during the boom.
To achieve this lower payment, IndyMac can lower the interest rate, extend the life of the loan to, say, 30 or 40 years, defer some principal to the final years of the loan, or a use a combination of these strategies.
IndyMac is also trying to simplify the process for borrowers. It is overnighting loan forms to eligible customers with a signature required upon receipt. "It doesn't show up with your regular mail, coupons and junk mail, because the key is getting the consumer to open it," said FDIC spokesman David Barr.
The papers clearly spell out a borrower's new loan terms, including the interest rate and monthly payments over the life of the loan. The borrower simply signs and returns the documents with the first lower monthly payment.
B of A follows suit
Bank of America (BAC, Fortune 500) launched a similarly systematic program earlier in October. That program, scheduled to start in December, came as part of a settlement with state attorney general offices that sued Countrywide, which B of A recently acquired, for predatory lending practices. It's expected to help 400,000 troubled borrowers and is actually slightly more aggressive than IndyMac's plan.
B of A will use a 34% debt-to-income ratio to calculate the affordable monthly payment for its customers, and may also write down the principal balance of some negative amortizing loans. IndyMac will not forgive debt, but instead will add principal to the final years of a loan if necessary.
Additionally, IndyMac's program is now being applied to many delinquent loans owned by Freddie Mac (FRE, Fortune 500), Fannie Mae (FNM, Fortune 500) and other investors, Bair said in her testimony Thursday."
10/24/2008
How Amazing the Synergy of a Group Can Be
For the past two days I have had the privilege of being at a seminar with an incredible group of people who in that short time have come together and forged friendships, shared experiences and knowledge and will have learned more than we could have imagined from both the speakers and each other. That is the synergy of a group of like-minded people who came together as strangers and will leave as friends sharing common goals and ready to help each other in reaching them.
I have been at seminars before where the speakers were great and the information useful but the dynamics of this group has gone beyond the norm. It makes me wonder what the catalyst is in creating the quick bond between people; is it the current economic crisis which makes us all feel more connected? Whatever it is it is energizing to be here, listening, sharing, talking, learning.
Certainly the people here are the type who see the glass half-full,not half-empty. Regardless of the state of the economy they are upbeat, positive in outlook and not letting the situation or the news sidetrack them from forging ahead with new ideas and plans for starting or improving a business. They are people who will not just survive the current economic situation, but actually move ahead with new plans and new endeavors.
"Nothing can stop the man with the right mental attitude from achieving his goal; nothing on earth can help the man with the wrong mental attitude."
Thomas Jefferson
I have been at seminars before where the speakers were great and the information useful but the dynamics of this group has gone beyond the norm. It makes me wonder what the catalyst is in creating the quick bond between people; is it the current economic crisis which makes us all feel more connected? Whatever it is it is energizing to be here, listening, sharing, talking, learning.
Certainly the people here are the type who see the glass half-full,not half-empty. Regardless of the state of the economy they are upbeat, positive in outlook and not letting the situation or the news sidetrack them from forging ahead with new ideas and plans for starting or improving a business. They are people who will not just survive the current economic situation, but actually move ahead with new plans and new endeavors.
"Nothing can stop the man with the right mental attitude from achieving his goal; nothing on earth can help the man with the wrong mental attitude."
Thomas Jefferson
10/21/2008
Some Photos From My Trip
I took about 400 photos, but these are just a few of my favorites. I hope you enjoy them!
10/20/2008
The Current Economic Situation is Crazy - But Another A.A. Milne Quote to Help Us Keep Balanced
“Promise me you'll always remember: You're braver than you believe, and stronger than you seem, and smarter than you think. Christopher Robin to Pooh” - A.A. Milne
I'm thinking that it's time to read more "Winnie the Pooh" these days! When the news swings like a crazy pendulum and you don't know where all of this economic craziness is headed you need to listen to Christopher Robin's wisdom.
I was happy to be away from most news during the first two weeks of October. When I returned and started reading about what had been happening I was appalled. Our news media created a frenzy of fear and near panic, and although there are serious problems now and ahead of us, how much unnecessary stress and angst was caused by excessive "news."
So the next time you feel anxious about the economy or anything in your life, take a deep breath and remember Christopher Robin's advice to Pooh.
I'm thinking that it's time to read more "Winnie the Pooh" these days! When the news swings like a crazy pendulum and you don't know where all of this economic craziness is headed you need to listen to Christopher Robin's wisdom.
I was happy to be away from most news during the first two weeks of October. When I returned and started reading about what had been happening I was appalled. Our news media created a frenzy of fear and near panic, and although there are serious problems now and ahead of us, how much unnecessary stress and angst was caused by excessive "news."
So the next time you feel anxious about the economy or anything in your life, take a deep breath and remember Christopher Robin's advice to Pooh.
Subscribe to:
Posts (Atom)
Posts
