I go through my site logs about once or twice a week and I see there’s a lot of traffic. From various blogs, a lot of which I read whenever I get the chance.
Some of the ones which throw me traffic are (in no particular order)
1.DINKS Finance
2.The Budgeting Babe
3.My Open Wallet
4.2 Million
5.Consumer Commentary
Thanks for the link love guys.
Special thanks to James & Miel at DINKS Finance for the special mention a few posts back!
I’ve been talking about people who blog for money. Well I’ve been making some money off advertising at the bottom of my blog. Well I’ve been paid to post this article on Responsibility In Pay Day Loans. What do you guys think of people who monetize their blogs in this way?
Choice And Responsibility In PayDay Lending
As of December 20th, 2006 there have been a total of 11 states that have banned payday lending. The payday industry has become a target of state and federal agencies that believe that the high rates of interest on payday loans constitute predatory lending for low-income families. By cutting off this source of emergency cash, the state and federal government has decided it knows best when it comes to consumer lending even when payday lending has been a viable industry in 39 other states for much time now. The states and federal government have not offered a different alternative to meet the fiscal needs that the payday lenders were servicing, essentially leaving many poor families with no way to get emergency funds when they need them. They believe they are doing the right thing.
Individual Freedom To Choose
This issue is not a simple one, by any means. The right of the individual to live as they see fit has always been a basic liberty in the United States. The government knows that guns kill people, but they don’t ban them. They know that people die from not being able to get high-priced medicines, but they don’t lower the cost of the drug. They know that most people will require taking out massive debt to attend an institute of higher education, but they do not regulate the tuitions of private institutions. These are seen as private choices made by the private individual and government doesn’t interfere. With these choices comes the individual responsibility associated with those choices. So, why regulate the payday industry? Whereas in certain instances the individual’s right to choose is held as sacred, in other cases, such as payday loans, government makes what appears to be an arbitrary decision to choose for all its citizens.
What Drives People To Make Bad Loans?
When one examines the forces behind bad loans, one often finds someone who made a bad financial decision for themselves. There are many other people who understand our credit system and use it responsibly. They understand that non-payment of bills can give one a poor credit rating. A poor credit rating causes interest rates on future loans to shoot up or become entirely unobtainable. They know how to get their credit reports for free from Equifax, TransUnion, or Experian, and how to dispute the credit entries. They know how to negotiate with their lenders and how to build up a better credit history. They know how many loans they can budget and how to use them properly. Those that do not have this information make bad loans for themselves, not understanding the dynamics of the lending market in place.
Payday lenders typically do educate their consumer on the terms of repayment and the interest rate due. These are clearly outlined before the loan is made. The consumer is aware that the interest rate is high, but if a late bill poses a $30 late fee and a payday loan only takes $25, this is the better alternative in the short-run. Payday lenders will generally require that the borrower affirm that they do not have more than one other payday loan outstanding at the time they ask for a loan. If someone lies and has multiple loans and then gets in trouble paying them all back on time, it’s simply a case of people making bad loans for themselves. They are advised not to take out multiple loans at the same time, and they do so anyway.
Educating One’s Self Is The Key To Financial Prosperity
There are plenty of people who use payday loans responsibly. As with any lending product, there are others who get in trouble. However, it has always been an American concept to give the consumers the freedom to choose for themselves. It might be easy for people who have a good credit history and little trouble making their bills to decide that payday loans are not necessary. However, there are many low-income people with no other form of emergency cash that would disagree with this position. In the end, the individual earns the money and the individual chooses how to spend it. Instead of limiting people’s options, it might be wiser to increase their financial education.
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The mint made an estimated 50,000 new $1 dollar Washington dollars without the “In
God We Trust” inscribed along the rim.
Sharp eyed coin collectors have been selling them on ebay for $200 each!! Keep your eyes peeled!
Mexican telecomm Mogul Carlos Slim Helu added $19 billion to his fortune in 2006. His gain, placing him at No. 3 on the billionaire’s list with $49 billion, was the largest one-year gain in a decade.
While not all of us can increase our net worth by $19 billion in 1 year, we might be able to grow it by 38% (19 billion is about 38% of 49 billion).
If you’re $14,000 in debt and have $1,200 in your bank account. Your net worth is a negative $12,800. If you cut your debt to $10,000 and increase your savings to $2,100 your net worth is now a negative $7,900 which is means you increased your net worth by 38%!
Suppose you have $40,000 in the bank, no credit card debt and a rental property you bought with 10% down worth $200,000. (yes, its possible to buy houses cheaply in several parts of the country). Your net worth is $60,000. If you were lucky enough for your house to appreciate by 15% (according to a previous post on Real Estate Research, thats 50% less than the median appreciation in Salt Lake City in 2006), thats a $30,000 increase in its value! So now your net worth is $90,000 or a stunning50% more than it was last year!
What if you had 5 homes like that?
With sufficient leverage its possible to substantially increase your gains but leverage cuts both ways. In a down market where the market drops 10%, your 10% down payment would sudden evaporate and your net worth would now only be $40,000. Again a drop of 50%. Did you notice that it drops quicker than than it increases?
Sub-prime lenders LEND, NFI,NEW were down again today, dropping between 3 and 17%. Wish I had shorted some of the sub-prime lenders instead of WCI!
I think this is just the tip of the iceberg, just like in the good old dot-bomb days when there was some initial weakening before the entire sector crashed. I think banks like HSBC will be negatively affected, more than they’re willing to admit. I think even regular prime lenders will be affected too. CountryWide (CFC) is flat for the past 1 year as opposed to New Century, which is down 70%. I think CFC will eventually drop another 30-40%.
I closed out the rest of my inverse S&P500 trade (URPIX) for a small profit. I did work out as a good hedge against losses in my other stocks.
In a previous post I mentioned that some bloggers make a decent living.
Well one of the highest revenue producers for John Chow was ReviewMe. Not being one to question someone smarter than me, I immediately signed up to whore myself out review other blogs for cash. Sure enough, a week later someone rich enough for fork over $60 took the bait! So here’s my review for Debt Consolidation Tips.
Overall, I really liked the layout and the very clean uncluttered look. (Quite a contrast from Living Off Dividends !). A good number of interesting and pratical articles related debt-negotiation, debt-management, credit cards, loans and consumer rights. I think my favorite post was the Top 100 Finance Quotes. Some of the gems were
The only thing I didn’t like was that I couldn’t find out who owns the site.(Well I found out who owns the domain, but thats not really the same thing!) I think people like to associate a name behind a site and get some background information. The fact that I couldn’t find any kinda bugged me. An “About” page would be nice.
If you visit the site make sure you check out 17 Hidden Tricks Lenders Use, and How to Avoid Them under the best posts section.
I have 2 friends with investments in Texas.
One of them has 50 houses in Dallas and would like to sell half a dozen to raise some capital. They’re around 6 months old, very reasonably priced, rental ready with property management and the seller guarantees 2 months rent.
Another has an upscale luxury condo in Houston and is looking for partners to go in on it. Minimum investment is $7,500. Yield is supposed to be 7.5%
If you’d like more information on either one, send me an email at [email protected] with the subject line of “Texas Investments”
I’ve been doing micro loans on Prosper for a few months now. I have 31 loans with $1910 loaned out. I’ve only transferred in about $1750 which means that my interest is now being loaned out too!
Thats the secret to attaining true wealth – Compound Interest. Have your interest earn you interest!
Unfortunately, there’s no way to shield this from taxes, but maybe if my corporation were to open an account, I could atleast have some deductions against it. Or maybe get a self-directed IRA!
The good thing about Prosper is you can start out with very little money. Yes, your money is illiquid but you’re getting pretty good rates of return. I’m getting around 18.6% interest.
Nowhere close to the 21-23% that other people are getting, but I haven’t had a delinquency yet.
I’ve also lent out some money on a private trust deed at 25%, which actually pays out 2% every month. Since I could invest that in some else too, that also qualifies as compound interest.
I also have some Canadian Energy Trusts that pay out a decent 11-15% dividend yield (they show up in my account every month). Since I don’t withdraw this money but instead reinvest the dividends, they’re all compound too!
Hopefully many years from now, I’ll be able to live off the dividends generated by the investments I make today.
I love compounding interest!!!!
I’m a big fan of protein shakes. No, I’m not particularly well-built, but I just like drinking them.
However, once you find a brand that doesn’t taste like carboard, it very quickly becomes rather expensive. I usually like using Froogle to find the cheapest stores however it can be misleading because they shaft you on the shipping charges. It becomes cumbersome calculating the shipping costs on several sites but I think I’ve found one thats rather good.
Its called Supplement Warehouse and they offer 5% less than any other site. All you have to do is put in the url to the cheaper site and they’ll knock off 5% of the cheaper price! On top of that if you refer you’re friends, they get 5% off their first order and you get the equivalent dollar amount off your next one! Pretty Neat.
If you want to buy something, send me an email and I’ll send you a 5% off link.
There’s a very interesting article today about how strip clubs are over-looked and under-valued. I’m not sure I necessarily agree with that point of view but there are some interesting points to consider.
* They’re recession proof. (along with barber shops and fast food joints)
* They have very low overheads.
The strippers pay for the luxury of working at strip-joints so there are no employee salaries or payroll taxes to worry about. Just rent and electricity!
* The have multiple profit points
First there’s the entrance charge that runs $20 or more. Then comes the food and drinks. Even if they aren’t allowed to provide alcohol, they charge steep fees for providing glasses and ice if the customers bring their own booze. Also they rent out room for private dances. According to the article that can run around $400-$500.
But the one thing that can’t be denied is the terrific performance of 2 stocks mentioned in the
article. Ricks Cabaret Intl Inc (RICK) went from $7 to $11(baring todays market performance) in 6 months and VCG Holding Corp(PTT) went from under $3 to over $12 in the same time!!!!
You can read the whole article at MarketWatch.com.