March 10, 2014
By Bob Brooks
This latest political spectacle is a disgrace. We start with the Republicans and their solution to ending the continued accumulation of debt. Their solution is to defund Obamacare. Said again, their solution was something that had a 100% chance of not happening. It is almost laughable considering that was the best that they could do. To make matters worse, they made themselves look foolish and probably can kiss the house good bye during the next elections.
Then there are the Democrats. They are not going to compromise at all. They are just going to continue spending money that we don't have. Remember, we borrow almost half of everything that we spend.
Then you have what is on the line during this political stand-off on the debt ceiling. The credit standing of America and potential debt default is on the line. The short-term solution should have been something that would have re-opened the government, as well as kept us from going into default.
The politicians take it a little bit further and add a few "dollars" here and there for their pet projects:
• They increased the budget for an Ohio River dam project from $775 million to $2.9 billion.
• They added another $600 million for firefighters in the Forest Service and another $36 million was appropriated for Interior Department firefighting.
• They authorized $450 million to be spent on road repairs and other projects in Colorado.
Senator John McCain commented that the additional spending is "disgraceful," using the excuse that many lawmakers didn't realize the bill contained additional spending like this until late in the process.
Really? With all due respect to John McCain, this was a 35 page bill. That is actually one you could have read ahead of time. If you think it is so disgraceful Mr. McCain, encourage the rest of your fellow politicians to vote no and say enough is enough. He really thought that the Democrats wouldn't slide something in a spending bill at the last minute? Being a career politician, you should know the game of politics by now.
These politicians have no objective to do the right thing. The temporary spending bill to open the government and lift the debt ceiling should be done without increasing spending. The reality is that all of us face paying for this financial irresponsibility one day while the politicians relax in their protected world of politics. That Mr. McCain, is the real disgrace.
March 4, 2014
By Bob Brooks
If you listen to most people on Wall Street, you shouldn't be concerned at all about the invasion of Ukraine by Russia. Warren Buffet was on CNBC stating that he was going to be buying stock no matter what.
Well, they do have a point. Over the years, we have witnessed some pretty dire confrontations in and with other countries. The market negatively reacts and then just like that, the problem goes away and the market is off to the races again.
Why wouldn't this be any different?
It might not be any different. This might not be a risk for the stock market at all. At the same time, this is a dangerous assumption to make considering we are talking about Russia and Russian President Vladimir Putin. Simply put, he is a former Colonel of the KGB and he is a thug. He is making calculated moves and he is convinced he can get away with it.
Martin Armstrong, who has been writing about this war months before any of this happened, had this to say last year. He is referring to the war cycle and how that cycle turns up in 2014, indicating that war is on the horizon.
"At our conferences around the world, we have discussed the Cycle of War and how this too has been incredibly accurate demonstrating that what may appear to be random, is really highly ordered chaos. This turns in 2014. To set the record straight, so far there appears to be no WORLD WAR that will begin. This appears to be separatism and civil unrest on the rise. Nevertheless, there is a risk of international war but this comes from RUSSIA! The problem with Russia is that there is still the old way of thinking empire equals power. Given the chance, Putin would sweep into Europe in a heartbeat. The KEY is always economics." January 2013
"The War Cycle is turning up. That means there is a high risk of this escalating into World War III. Russia could easily enter the war and demonstrate its power. Its advisers in Syria would love the opportunity to test Russian weapons against American ships for live practice." August 2013
Notice how Mr. Armstrong changed his stance on a potential World War between January and August. You can follow him in real time on his blog - http://armstrongeconomics.com/armstrong_economics_blog/
Maybe something and maybe nothing – just don't make the mistake of ignoring and assuming that it just goes away. Know your risk and always have your Plan B to fall back on.
#Vladimir Putin #Russia #Ukraine
March 3, 2014
By Bob Brooks
A new study shows that car buying in America is drastically changing. The report states that the change in buying habits is the biggest shift in 50 years.
"The McKinsey report says the average buyer visits just 1.6 auto dealerships while car shopping, down from ten years ago when buyers visited an average of five dealerships."
The results of their study are not surprising. With the internet, consumers should be able to do 95% of the legwork and narrow down their choices to a handful of cars. So, how do you leverage the internet for car buying?
There are numerous resources that you can use to buy a car. However, I have narrowed it down to my favorites:
This is the Kelly Bluebook site. On this site, you can research general information and reviews on any car on the market. You can check the trade-in value for your current car to get an idea of what you might receive. Keep in mind, that car dealers are not even remotely giving the trade-in value that any of these sites are quoting. However, this gets you in the ballpark.
Once you figure out what you want, you then start the real research process.
On this site you can pull up cars all over the country, and check to see the going price. This is a great way to check the current prices, and get an idea as to a fair price for a new or pre-owned car purchase. It also enables you to see dealership inventory and availability. Keep in mind that dealerships are not quick at updating cars that are sold. So, you will need to verify the availability of the car before you move forward.
If you are looking for a pre-owned car, most dealerships make the Carfax report available for you to check. The Carfax tells you the history of the car, and whether there have been any accidents or any other concerns. It also can tell you when the car was listed for sale. This can be valuable information because cars that sit on car lots for a long time are more likely to sell at a discount than cars that were just listed. Dealers are more motivated to move old inventory.
With all of this information, you can start the negotiation process over the phone, and get all of that out of the way before you even step foot in the dealership.
The most important step that you can take is getting pre-approved before you step into the dealership. You will not get the best interest deal at a dealership in most cases. This is where consumers make the worst mistakes.
This is the Pentagon Federal Credit Union. By far, the best vehicle financing site on the planet. They are easy to work with, it is easy to join, their customer service is excellent, and they have several different financing options. Typically, they have some of the lowest interest rates on the market. For instance, they have one program currently that is .99% for 3 years. Their standard rate is 1.99% for 5 years.
If you are buying a car anytime soon, make sure you utilize technology to your benefit and get the best deal possible
February 27, 2014
By Bob Brooks
I was reading a survey about the US penny. It was a survey that quizzed men and women on whether or not we should get rid of the penny. I thought it was a good question. So, I looked up some facts about the penny and discovered a few disturbing things.
It costs 2.4 cents to make a 1 cent penny. Not too tough to imagine Government inefficiency.
Then, I came across a quote from President Obama on his thoughts on the penny. Out of the lengthy quote, there was one part that stood out at me:
"This is not going to be a huge savings for government" (if we get rid of the penny).
I looked it up to see if he was right. It would have saved the country $55 million in 2013 had we stopped circulating a coin that no one really assigns any value. I don't know about you, but $55 million is a lot of money. However, it isn't when you consider that we have a debt of over $17 trillion dollars. I mean, $55 million dollar savings doesn't even put a dent into a debt of that size.
This is the problem in Washington in how they interpret what is small. On an individual basis, they can waste 100's of millions of dollars on their donors and pet projects, and justify it by comparing it to trillions of dollars that they spend collectively. In other words, 100's of millions of dollars is nothing compared to our budget and the money that we owe in this country.
Now, consider that there are 538 of them, with a good majority having influence over some type of financial waste and vote buying/paybacks. What if we collectively gathered all of that waste? Do you think we could start to put a dent in $17 trillion dollars of debt? $55 million by itself won't do anything. However, 75 to 100 wasteful projects that cost $50 to $100 million a piece can produce some real savings.
Consider what it says in Luke 16:10:
"One who is faithful in a very little is also faithful in much, and one who is dishonest in a very little is also dishonest in much."
They are throwing us into financial ruin because they consider 55 million or 100 million dollar pet projects nothing more than mere pennies. Once again these mere millions are not a big expense when you are spending trillions. Ironically that verse also refers to being dishonest. There couldn't be a better correlation.
What if 55 million was still a tremendous amount of money to a politician?
February 25, 2014
By Bob Brooks
Student loan debt has surpassed $1.2 trillion dollars, and climbing. It has created a real burden for students who have chosen to finance college costs. For government based student loans, there are several programs in place that will ease the burden of the student loan payment. However, privately held student loan debt has always been a real challenge, due to lack of solutions.
CNBC reported this morning that a solution does exist. I hadn't heard of this before, and thought it was worth sharing.
"In January, RBS Citizens Financial Group, which operates Citizens and Charter One banks, introduced a new Education Refinance Loan, with fixed rates as low as 4.75 percent APR, and variable rates starting at 2.8 percent APR. There are no application, origination or disbursement fees and you don't have to be a bank customer to apply for this refinance."
That is great news for students with high interest privately held student loan debt. You could end up cutting an interest rate in ½, which dramatically reduces your payment. Take for example, a student that has $40,000 worth of student loan debt financed at 9%. Assuming that it is going to take 20 years to pay it off, your current payment of $359.89 would be reduced to $258.49.
I would stay away from the ever so tempting variable rate of 2.8%. Although that sounds great, it is not fixed, and will go up as interest rates and they will rise.
Apparently, there are no fees involved to get this loan. This sounds like a good deal. However, READ THE FINE PRINT and look for the GOTCHA. My only reservation is that they seem to be the only bank that is sponsoring this type of program and these low rates. It begs the question – Why aren't other banks attempting to do this and refinance student loan debt?
Remember, your best friend is always the fine print. It will tell you everything that you need to know.