Hidden Fees at Chase

Recently, I have been moving my assets around to different banks, seperating out what I consider temporary versus permanent cash.

My Chase account is the primary receiver of money, and from there, I distribute the money to my investment accounts, credit cards, etc. While this has been successful, I had wanted a better method to transfer funds between accounts in different banks rather than writing checks and walking into brick and mortar facilities to cash them.

I saw that Chase offered online transfers, and thinking they were the same as the e-bill pays I had been performing, I linked my Citi account to my Chase account. I then went through the procedures and transferred $1,500 in my Citi account.

After two days, I noticed a $3 fee related to the transfer. When I called Chase, they promptly told me that:

1. There was a fee to transfer money online
2. I agreed to the fee in some jumble of legal disclaimers (who ACTUALLY reads them?)
3. The price is stated in small font somewhere on the website

Of course, per the norm, banks can nickel and dime you out of anything, so after about 30 minutes, I gave up on getting my $3 back.

But it angers me that the fee is equivalent to a 0.2% charge on moving my OWN money around.

Watch out for these so-called "conveniences" in your online banking activities.

Market Outlook and End of the Year projections

Today started disastrously, with a major block of crude oil pipelines shut down due to an explosion. This scared the Street in the pre-markets, but as the smoke cleared, things seemed to settle down. There was no sign of terrorist activity, and 2 of 4 pipelines were immediately brought back online.

Throughout the day, the market continued to seesaw, dragged down primarily by higher than expected jobless claims and lower than expected new home sales.

The market ended up slightly ahead.

Tomorrow's outlook? Bright. The Asian markets are doing well, and hopes of Fed rate cuts remain. The correction downward in oil futures have also decreased inflationary fears. Technology especially is coming out of the dog house, as more investors realize the great bargain buys that exist (Amazon, Microsoft, Cisco).

I have been keeping track of some financial stocks that I believe are great bargains such as E-Trade Financial (ETFC) and National City (NCC). I own about 350 shares of E-Trade and plan to buy National City options tomorrow.

For the rest of the year, I see positive impacts for a Fed Cut, and also normal holiday cheer in the market, resulting in the Dow closing likely above 14,000.

Finally, a PF post

It has been a while since I've blogged a real personal finance post, so I'm going to try this again.

Recently, I've finally put into place my free and no-risk interest income from debt.

Having read enough of these posts on other blogs, I know its going to start off looking like another convoluted get-rich quick scheme. It is not. This is neither quick nor easy.

1. First off, you need to have good to excellent credit.
   
2. Second, credit companies or banks must be willing to lend you money at no interest for anywhere between 6-12 months.
   
3. Third, you have to know a bank willing to give you a reasonable 3-5% interest rate.
   
4. Finally, you need to be able to handle a sizable debt load without any large debt needs in the near future.

This is how it works:

1. Credit card company X sends you a letter: "You can get $Y amount of money to pay off your other credit card bills for Z months for 0%"
2. Say you are given a $10,000 line of credit for 6 months at 0%.
3. You find a bank willing to give 4% APY.
   
4. You take credit card company X's loan and deposit into the bank for 6 months.
5. At the end of 6 months, you have collected $200 in interest.
6. You empty your bank account, pay back the $10,000, and keep the $200 for yourself.

Of course, you have to be sure to pay it all back before your 6 months is up, or you'll be hit by massive interest rates (probably 25% or more).

Ironically, as you take on more debt load, you'll get even more debt offers. These interest payments start small, but it is not unheard of for the debt load to go up to $100,000 to $200,000 at a time.

Given the same 4% APY for 12 months on $200K, that's $8,000 a year for free.

Now who can't use $8,000 a year more?

The beggining or a fluke?

With the ridiculous volatility of the market these days, was today really a result of Citigroup's $7.5 billion cash infusion (really a regular corporate bond sale) which has completely wiped out all subprime fears or is today another example of daily short-term market reactions that has characterized the last month of market movements?

Around midday, I was ready to believe in my own cynicism. The market started plummeting, sputtered out, see-sawed, and then dropped for a while. An hour before the end of day, the market caught itself and shot up to close near the day's highs.

While I'm not a 100% believer in the technicals, I do believe that a study of market movement does give a good indication for what the market is thinking in the short-term. In my mind, such a dip was initially caused by investors who had been holding their breath for a long time to see just their investment come back, followed by the uptick representing other investors who finally saw a bottom and realized just how oversold the market really is.

At the same time, another data point related to the subprime market will be released tomorrow, existing home sales. This could have an adverse affect if the trend is sharply downward.

Fat from Turkey day, the Street may be in the same upbeat mood

Going into the Thanksgiving weekend, I was worried about when the market would snap out of its rut. For a while, the market has worried about the declining value of the dollar, rising gasoline prices, and overall economic sluggishness.

The last trade I made last week was to buy more Nasdaq QQQQ Dec '07 options at 51 on the belief that Thanksgiving weekend retail sales would be both great and the news the market needed to get out of its rut.

So far, half of that has come to fruition. The numbers from this past weekend have been good (article here). Now I hope Wall Street will respond in kind, and really get the magic back.

Update: Asian markets are upbeat on this retail news, so Wall Street seems more likely to follow suit.

Gobble Gobble

The market is looking sluggish, but frankly, I'm going to check out for the rest of the week and ride out the waves over some turkey. The market is volatile, and people are repeating the big R-word (recession). But I really think people just need time to think, and they'll realize the economy isn't as bad as people think it is.

Quick and quiet, with a chance of showers

This week is going to be a shortened trading week, with most traders worried more about where the turkey is coming from than where the market is going. Expect trading to be light, and market direction to waver, rather than trend one way or another.

Market Hiccup, CPI Numbers to Come

The market took a little hiccup at the end of day, although throughout most of the day, it was in the black on good inflation news. More inflation news is expected tomorrow with the release of CPI numbers. Tame inflation will be good for the market, as inflation fears have been one of the primary reasons the Fed refused rate cuts in their last meeting. The next meeting is scheduled Dec 10, and many are looking for another rate cut to get the economy and the market back on track.

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Hell has frozen over: Walmart reigns supreme

What an unbelievable day on the street!

Dow up 319. Nasdaq up 89, and S&P up 41!

Just insane. And what caused all of this?

Well, it all started with Walmart. That's right. Today, Wall Street cared completely about what was happening on Main Street, and on Main Street, Walmart had made a better than expected profit off of what many considered a dismal quarter for retailers.

Why did I mention hell freezing over? Because never in a million years did I think that one day I would say to myself "Thank God for Walmart", but I did. And now let's put it behind us and never speak of it again.

The rest of the day was a parade of major banking institutions' CEOs giving their view of the credit markets, led by Lloyd Blankfein, CEO of Goldman Sachs, who announced that Goldman going to have an significant write-down of its assets.

My outlook is that this new found exuberance will last until at least Thursday. Friday will be a tough day as options will be expiring, and there always tends to be a downward trend on expiration days.

For the next few weeks, volatility is still high, but if oil continues to fall and the dollar continues to strengthen, I predict we can see a resurgence of the Dow getting close to the 14000 mark again by year end.

I certainly have money riding on that.

And because I haven't done this in a while, please note my disclaimer, which is also on the bottom of every page on my blog:

Disclaimer: I am not responsible for any financial and/or personal situations that arise from information in any of my blog posts. Financial advice is given to the best of my knowledge, which may or may not be accurate. Stock picks and stock market analysis should be considered 100% bias, as I will obviously talk about good/bad picks that I personally may or may not be considering/holding.

Super Busy + Market Fears = Losing Money

The past week, I just could not find time to blog, nor really stay abreast of the market, other than watching my portfolio drop in value.

I hope to remedy both of these situations this week.

Last week, the markets crashed on continued subprime mortgage fears from the major banking institutions (how much more loss are they hiding?) on top of rising oil prices (nearing $100/barrel), and the related issue of the falling dollar.

I would love to say that I believe we've reached the bottom, and certainly my options would love it if the market was ready to go up, but there is a good chance that early this week, we'll still see market jitters, with the market smoothing out, and maybe rocketing higher by the end of the week.

One important piece of economic news will be released this week that will have a major impact on the market: retail sales figures due on the 14th.

The Market Always Likes Going Up

It's really true. The market enjoys upward trends and abhors downward trends. No real economic data came out today to support such a market bump, but it occurred anyway. This is why buying on lows (bargain hunting) is a rule of mine, and a rule that many investors follow.

The tough part is trying to find the right time to buy during an upward trend time, or mixed weeks, such as this week.

My suggestion? Stay out until the end of November. The markets are extremely volatile, and if you aren't in already, wait it out.

Shitty Citi

Why oh why! Citi was supposed to fire Chuck and call it a day. That would have propelled the stock upward.

Instead, they went with a bloodbath, and bam, the market tanks, Citi stock tanks, and the whole world has decided to be in worry mode.

My hope? The market loses some fear, and people realize how good of a deal Citi is now.

Unbelievable day in the market!

So I suppose there was one scenario I should have offered up yesterday, that both crazy up and crazy down would occur, which would cause the market to fluctuate back and forth all day, ending in the green across the board.

Two big pieces of news came out of today:

(1) Citigroup's CEO Chuck Prince is expected to resign Sunday! This should result in a nice bump for the stock, considering so many people have thought most of Citi's problems have been Prince's leadership.

(2) Merril Lynch has been engaging in some shady off-balance sheet deals with hedge funds to put off losses to a different time. This resulted in a 7.9% drop today, and most likely continued losses next week.

Morning update

Pre-market looks green, but only barely, so its a tough call. Can still go either way.

There is no fury like a stock market scorned

Wow! Just WOW!

Today was one of those days that as soon as I woke up and stubbed my toe, I knew it would not be a great day. Throughout the morning, bad news was coming left and right.

First it was Citigroup. Analysts from CIBC downgraded Citigroup, citing fears about continued fallout from the subprime mess caused the big C to tumble 6.58% or loss about $14 BILLION in market cap. This also prompted concerns across the entire banking sector.

Then, Exxon Mobile reported a 10% decline in profits.

Throughout the day, the market fell like a concrete airplane filled with concrete little people all hoping to get on the ground as fast as possible.

And on top of that, CVS announced a great quarter and its stock price still plummeted 1.5%.

So, what will happen tomorrow? There are really two possibilities I can think of:

(1) The market will stay in its death spiral, feeding off of today's loss and the Asian markets reactionary drop to continue falling.

(2) After one of the biggest losses in the Dow in months, bargain hunters see an excellent opportunity to buy in.

Option (2) is definitely very optimistic, but barring any good economic news, i think the chances are 70/30 for option (1).