Tuesday, March 31, 2009

Networth Update

It's been a while since I've posted my networth. There has been significant improvement since my last networth post in November (-$16,488) and even from last month, which I didn't post of -$10,801.

As of March month end, my networth was -$7,050.

Much of this rapid increase in my networth has been due to year-end bonus payouts and an increase in my 401(K) account thanks to the stock market getting better.

Also, I have become much more conscious about sticking to my budget, and every month, I have been able to pay down my debt by spending less than budget and using the leftover for debt.

Monday, March 30, 2009

Homebuyer Credit

Recently, I posted about my renewed desire to purchase a home. Someone commented about what $8,000 credit I was referencing, so I did a bit more research.

There are currently two tax different, but mutually exclusive, new homebuyer credits.

1) If you purchased between April 8, 2008 - December 31, 2008, you are eligible for a 10% tax credit on the value of your purchased home, up to $7,500. This credit is essentially an interest-free loan for 15 years. More information can be found here: IRS link

2) If you purchase(d) anytime before December 1, 2009, qualify for a $8,000 credit that does not have to be paid back. Additionally, if the purchase is after April 15 (filing date for taxes), you can file an amended tax return. More information can be found here: IRS link

I had actually been wondering about what would happen if I purchased after taxes were due, since I could definitely use that $8K after I buy the house.

Wednesday, March 25, 2009

Time to Buy a House

I have been contemplating a house purchase for a while now. I know I'm going to be in the area for at least 3 more years, and the housing market looks like its at or near the bottom.

Last week, the Fed's move to pump more money into mortgages and to back the purchase of "Toxic" mortgage backed securities sent mortgages rates down significantly.

As you can see from the chart, interest rates have been steadily falling, and I believe its at its lowest possible point.

On top of of that, there is still a $8K credit from the IRS.

I think its time to help out the economy, save myself some taxes, and save on rent payments that don't build nay equity.

Monday, March 23, 2009

Market Rallies... but why?

Today, the Dow started up 200 points, and ended the day up nearly 500 points, or a gain of 6.84%.

In the last two weeks, the Dow is up 1149 points or a gain of 17.34%.

How do you even begin contemplating the rationale behind such a huge upward swing, which is so counter to the past 6 months of bearish movements? Over the past 6 months, the Dow is still down 3078 points or a decline of 28.36%.

So what explains this?

I still think we're in a period of rash exuberance, heavily led by day to day government policy decisions. However, I still want to see some good economic data points to back this up.

While housing sales have increased, this has been primarily driven by increased foreclosure sales. Gas prices are still going up, driven by the falling value of the dollar. Unemployment rates continue to rise, heading toward 10%.

I think its possible that the stock market is close to a recovery period. But for the average investor, I would suggest waiting a bit more, to wait until something more substantive than a quick 2-week upswing, that could easily become a dead cat bounce by week's end.

Thursday, March 19, 2009

FRAUD ALERT: Google Money Machine IS A get rich quick SCAM

Recently, I have been checking out various blogs on the blogtopsites.com list, of which I am a member. Quite often, I am seeing sites proclaiming "Google Money Machine" and "Earn $150/day" in some of the top 50 finance sites. Obviously, this peaks my interest.

When I went, this is what the website looks like:
Immediately, I'm suspicious. Are there really that many altruistic people out there trying to make YOU $1000s a day? No way!

But I am always curious, so I kept clicking. Eventually, you land on the page in the second picture.

Here, a care-free cute female greets you with a pile of cash and an excited smile.

This should instantly cause warning bells to go off.

On the right side, they use two devices that advertisers use to confuse you.

First, they tell you in bold capital letters to "Take Control of Your Financial Future"; a call to action. Second, they create a false sense of urgency, by running a 15-minute countdown timer. Interestingly, as I was writing this post, a message box from this site (running in a different tab), opened up to ask me if I needed more time since the 15 minutes was up. When I clicked "no", the timer restarted, regardless.

That should be the second warning bell.

Now, how most scamming sites work, and how they avoid legal prosecution, is by having a terms and conditions set forth that prevent you from actually taking legal action.

I looked for it, and I reproduce it here, in bullet form, the most important parts of the scam (Full terms & Conditions reprinted at the bottom of this post).
  • $69.90 a month after 7 day trial
  • You agree to be billed monthly
  • $2.95 for setup of 'Home Business Kit'
  • They will never send any billing notifications and you agree that this is okay
  • No refunds will be given if you don't use the services
I haven't bothered to figure out what the services are, but I have yet to find a site that actually has any verifiable checks or endorsements of this service. The site even claims that major news networks have discussed them, which is certainly not the case.

Finally, the address of this company is:
4240 West Flamingo Rd. Suite #201
Las Vegas, NV 89103

And their phone number: 1-800-497-4988

When you Google that address, two interesting points pop up:
And here's a log of complaints about that number and the related credit card charges:

I don't know how these guys get away with it, but PLEASE PLEASE PLEASE, don't get scammed by them.

Further research of the referring site, browsefreetrials.com, leads to this address:
15111 N. Hayden Rd., Ste 160, PMB 353
Scottsdale,Arizona 85260

And to the company Domains by Proxy (http://domainsbyproxy.com/), who helps people mask the identifying information for their domain registrations.

While not immediately damning, the fact that a company needs to hide their location and their employees names should tell you something.


Full Terms & Conditions:
"By submitting this form I authorize Google ATM (DRI*GoogleATM) to immediately charge my credit card $2.95 USD for the setup of the Google ATM Home Business Kit. I hereby request that Google ATM (DRI*GoogleATM) activate my account and authorize them to advance funds as indicated. Monthly Service fees will commence seven days from the date of this purchase, and will be billed monthly thereafter. After the seven day trial you will be billed sixty nine dollars and ninety cents USD monthly for the continued access to the Google Money Making System. No refunds will be given for failure to use the requested and provided services. You may cancel at anytime by writing to 4240 West Flamingo Rd. Suite #201, Las Vegas, NV 89103 or calling 1-800-497-4988 (International customers please call 1-866-321-2728). I agree that Google ATM (DRI*GoogleATM) shall be fully protected in honoring any electronic transfer or collection. Google ATM shall not be responsible for refunding any Account Set-Up fees. By submitting this information I am agreeing to the terms stated herein. Google ATM (DRI*GoogleATM) will not send notification, postal or electronic, when a billing occurs."

Wednesday, March 18, 2009

Not every finance guy (gal) is evil

As Wall Street's fortunes blow raggedly in the wind like an old flag, it has become easier and easier to lump every finance person into the same money-grubbing, soulless, and otherwise parasitic member of society as the likes of Madoff and Liddy (AIG's CEO).

It simply isn't true.

I constantly have philosophical struggles with combining the cutthroat nature of capitalism and the softer, and more humane, qualities of socialism. I think of socialism not as the original Marxist idea of full governmental/public ownership of all means of production, but rather the existence of a social structure in which those who have fallen on hard times can be lent a helping hand.

It is tough, and especially in the current environment, to not be hit in the face with the struggles of other people, rather from the 9% unemployed or the larger numbers of who are turned off from the job search altogether.

But beyond that, there are so many more social issues that still remain unresolved. Racism, wars, genocides, torture, environmental well-being, education, healthcare, etc, etc. The list of social causes to ascribe to is long. And my time to devote to any is short.

I think of the world with 3 types of people: social activists, average, social supporters.

The activists are those who, to borrow a religious term, have been given or felt a calling for a cause. They would be the ones tirelessly, perhaps even solely, grinding against the grain of society to right a social wrong.

The average are the average, going about their lives in a pursuit to learn about what their lives mean.

The supporters are those who, while unable to find one calling, have the financial means to support causes. I find myself in this category. Certainly I benefit from the pursuit of capital, but at the same time, I know that as I gain material wealth, I should also ensure through charity, a gradual societal improvement.

There is no question that activists are perhaps more noble or selfless. They have found a passion and pursue it, perhaps to the detriment of their own well-being. But they still need supporters to open doors or provide the funds to fight social structures.

Why can't I see myself as an activist? I do like material goods too much. I don't think I can be as noble or selfless, nor could I pretend to be without an ulterior motive.

Every year, I do give to causes that I believe are forces of social good. I think of Buffett and Gates as the role models of this wealthy to charity notion.

It will take a while for me to get there, and it will certainly be hard to do no evil while in the confines of capitalism, but I think this is the struggle of any professional, including finance.

Sunday, March 15, 2009

Tax Returns

Say what you will about the way the government runs, but this year, I am thoroughly impressed with the speediness of my tax refunds. This past Tuesday, I submitted by e-File both my Federal and State refunds. By Thursday, I had my State refund in the bank account, and by checking the "Where's My Return" on the IRS website, I know I will have my Federal return by March 24th.

As much as I hate to say, it does appear that the IRS has gotten more user-friendly.

Thursday, March 12, 2009

Cramer on Daily Show was Ball-LESS!

That's right. Ball-less. Without balls. Neutered.

Was Cramer on to beg and plead with a COMEDY show?! Christ.

Cramer needed some sort of help there.

CNBC needed to at least prep him. Cramer is almost crying.

This is stupid.

I have no particular love for Cramer, but this was a situation where a little kid got a sever talking to by an adult.

To quote Cramer, "a wall of shame".

This is sad.

Tuesday, March 3, 2009

e-Filing Taxes and Refund Tracking

I've been using tax prep software for my taxes the past two years, and I've really enjoyed the simplicity of it. This year, I had most of my information typed in, but I had been waiting for any new tax laws to go through.

While waiting, I had been debating the merits e-Filing like I did last year, or mailing in a paper copy. The only real detriment in e-Filing that I can discover, outside of paying a fee, is that it is easier for the government to audit your statements and make you pay more.

Well, I just take the standard deduction and I have some capital gains losses, so I don't have much to worry about.

I did however, discover an additional benefit: the government has a website setup to help track tax refunds, and for e-Filers, the tracking starts 72 hours after filing, rather than 3-4 weeks for the paper version.

The address is here: http://www.irs.gov/individuals/article/0,,id=96596,00.html

Sunday, March 1, 2009

Recession: Who is it hitting?

This past weekend, I was in Rochester, NY meeting up with some B(usiness)-School and college buddies for some drinks. One night, my b-school buddies and I went to an old haunt: an upscale restaurant named 2Vine. I've linked to the menu, but the average entree is about $30 with a typical meal averaging about $50-60 a person.

I was surprised when I called up the night before to get dinner reservations. We had to go at an earlier hour because they had much of their time slots reserved already. When I showed up, they had to turn away quiet a few people because they had no spots for walk-ins until 8:30PM.

This is surprising to me that they were doing so well. This isn't the first time I've been to a nice restaurant and seen it packed to the gills with people in the past few months. Sometimes I think that there are MORE people going to nice restaurants than before.

Perhaps people are choosing dine in or go out to eat nicely, but stop visiting the mid-tier resturants like an Applebee's or TGIFridays?

I don't know how I would collect that evidence, but certainly from this weekend, the rich don't seem to be that much poorer than before.