Current Events

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Naive Lemmings?

Could it be the the Clairvoyant Prashant Bhatia? Who?

You know, with all of the headlines on CNBC about the “Credit Crunch”, “Housing Slump”, all around doom and gloom, it’s tough to feel good about the financial future. I’ve always kinda wondered what causes these huge dips in the markets and one of the articles on CNBC raised my brow.

This one is about E*Trade’s falling share price due to an analyst downgrading the stock.

Read that again.

Yep, “an” analyst.

One guy, from a third party, can come in out of no where and wipe you out.

Citi Investment Research analyst Prashant A. Bhatia cut his rating on the stock to sell from hold and lowered his price target to $7.50 from $13. E-Trade shares were down 34% at $5.65 in recent premarket trading.

Bhatia said there’s a 15% chance that E-Trade will declare bankruptcy and said management may be forced to sell loans and securities at significant discounts.

Um… okay.

I guess what bothers me the most is that Bhatia works for another investment group. A rival of E*Trade, to a certain degree. And if memory serves me correctly, it was just last week that Citi was in the crosshairs.

Pretty nifty way to deflect attention, if you ask me.

Further, being that these are “number” guys, how on earth did he come up with a stat like “there’s a 15% chance that E-Trade will declare bankruptcy?”

Seriously.

He’s not much of a soothsayer in my book. C’mon, 15%? Not a real definite prediction there…

I mean, I’d say with certainty that I have a 15% chance of getting food poisoning today — but that’s the thing, that’s such a low percentage that I’m not going to let it bother me.

But the scary part is that Bhatia’s comments actually caused E*Trade to plummet.

The way the markets sway on tiny little snippets like this — it’s unreal?!

Are they as naïve as lemmings?

From today’s Hartford Courant…

The state of Connecticut is unveiling a $50 million program to help first-time homebuyers caught up in the subprime mortgage mess.

The Connecticut Housing Finance Authority is offering to help low- and moderate-income borrowers by refinancing their adjustable rate, subprime mortgages into 30-year, fixed rate loans. The authority will begin taking applications on Dec. 10.

Subprime mortgages are typically targeted at borrowers with risky credit.

First-time homebuyers who cannot make their mortgage payment and currently live in the home can apply for the refinancing. The housing authority will work with the homeowner to make sure the new mortgage payments fit with their budgets.

About 300 to 400 families are expected to be helped by the program.

This really irks me.

Not just from a taxpayer perspective.

Take the $50 million and divide it by the 400 families which the program will help. That works out to $125k for each family.

That’s about what I owe on my home right now.

But you know what? Because I was smart when I went out and found a mortgage as a first-time homebuyer, I didn’t go for an adjustable rate. I was informed of the risks, and I wasn’t willing to take them. Essentially, the risks outweighed the benefits.

Based on the past few months, it was a wise move.

But now, it was evidently the wrong move. I could have been paying a nice limited time offer promo-rate mortagage bill all this time (interest-only would have cut my mortgage bill in half?!) and the State would have come to bail me out in the end. That… is not right.

I don’t know the specifics of the program, but I truly hope that these folks end up paying well beyond the traditional 30 years. And that the little equity they may have in their homes is wiped clean.

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Canadian LoonieWow.

This morning, the Canadian dollar opened at 108.17 cents US, up 0.99 of a cent from Monday’s close. The U.S. dollar stood at 92.45 cents CDN, down 0.85 of a cent.

As a proud Canadian, that puts a smile on my face.

At the same time, as someone who lives in the States and intends to long term, it makes me a little uneasy. In the grand scheme of things, it’s probably not a good thing when the pendulum swings this direction.

But again, on the upside, it makes it even nicer when co-workers toss their “worthless” Canadian change my way. Oh, if they only knew.

Too bad it’s so difficult to exchange Canadian change at a US bank… though if the exchange rate gets much higher, I just may have to stop in and ruin an unsuspecting teller’s day!

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Britney SpearsFrom an AP story last week that puts things in perspective:

The pop princess is a big spender.

Court papers released Thursday in Britney Spears’ custody dispute with Kevin Federline show she spends lavishly on clothes and entertainment and doesn’t save or invest any of her roughly $737,000 monthly income. Spears’ monthly expenses include $49,267 in mortgage for two houses, $16,000 for clothes and $102,000 on entertainment, gifts and vacation, her financial declaration shows.

Although she’s often photographed eating fast food, Spears declares she spends about $4,758 per month dining out. Meanwhile, she spends zero on education, savings and investments and gives $500 a month in charitable contributions, the documents said.

She has to pay her ex-husband $15,000 a month in child support and $20,000 in spousal support. Spousal support will end Nov. 15.

As for Federline, his biggest monthly expenses include $7,500 in rent and $6,000 in security, his financial declaration shows.

The dancer-turned-rapper has a comparably modest monthly budget for clothes – just $2,000. He also spends about $5,000 on entertainment, gifts and vacation, and $1,500 eating out.

Federline, earned more than a half-million dollars in 2006, mainly from entertainment and endorsement deals but grossed only $7,436 that year. He receives $15,000 a month in child support.

It blows my mind that someone from such humble beginings, and someone who didn’t exactly “fall” into the money suddenly, is so careless with their wealth…

Seriously, you have to wonder who her agent is, or was, to not advise her to put a little aside for when her career comes crashing down. I mean, she must have nearly 16 years left of those child support payments — a cool $2.8 million.

There is a bit of an unfair negative slant to the story though…

Her $4758 per month dining out budget sounds really high, but if you divide that out, it works out to around $52 per meal. Yeah, that’s a lot, but even I’ve had a more expensive meal than that from time to time. For a “star” with an income that high, I don’t think that number is real out of line or even irresponsible.

The clothing budget doesn’t seem too crazy either. Okay, yeah, for me, my yearly clothing budget is likely under $500, but I’m in a position where I can get away with wearing the same pair of pants 3 days per week. That, and my pants aren’t custom made to fit my butt. I’d imagine that’s not cheap.

I also wasn’t too keen on how they threw in the “gives $500 a month in charitable contributions” line in there like it’s a bad thing.

I never like it when people are made to feel guilty for not giving to charity. Or giving a small amount, To each his own. But I would guess that $500/month is a lot more than your typical American. I’m not going to fault her for that.

But c’mon Britney… You have to invest something?!

(And in some ways, you need to give K-Fed some credit. He could live lavishly for the rest of his life on the child support checks alone…)

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Powerball Winner John LorussoA couple of weeks ago, the winning Powerball ticket was sold relatively close to where I live. Okay, not that close, but I’ve driven through the town before — that has to count for something!

And no, I wasn’t the winner. You can’t win if you don’t play and, well, I don’t play.

Anyway, here’s an excerpt from my local paper:

For two weeks, no one knew who bought the winning $15 million Powerball ticket at a convenience store in Ashford earlier this month.

The winner kept the news to himself until Wednesday when he showed up at the Connecticut State Lottery headquarters in New Britain to claim his prize.

John Lorusso, a regular at the Squaw Hollow X-tra Mart, said at the lottery headquarters Thursday that he had been waiting for his business partner to return from vacation before telling people he was the state’s newest millionaire.

I just felt it was right to wait,” he said.

Lorusso, 43, of Eastford, received his prize Thursday at the lottery headquarters.

He opted for the lump sum of $7,035,647.28. After state and federal taxes, Lorusso will get $4.9 million.

“I have more friends that I had before,” Lorusso said jokingly. He said he played Powerball twice a week for about three years. This year, he purchased a Quick Pick with the winning numbers 2-4-14-15-28 and the Powerball 23.

The drawing was Oct. 3, but Lorusso didn’t realize he was the winner until a few days later when he stopped by the store.

“They’ve got the sign up, `The winning ticket was sold here,'” Lorusso said.

Lorusso grabbed a printout of the winning numbers and brought it to his car where he compared them to the numbers on his ticket.

“These look a lot like the numbers,” Lorusso said he thought to himself.

He wanted to keep the news to himself until his partner at a commercial printing company returned from vacation.

He said he felt bad lying to them and stopped going to the store. Lorusso returned Wednesday night to explain himself.

“I didn’t want to lie to you guys anymore,” he told them.

Lorusso said he has no immediate plans for his money, but wants to be smart with it. He has denied his son’s request for a flat-screen television.

My first reaction was, that’s cool that he kept it to himself and waited for his partner to return from vacation.

My second reaction — how can they still call it a $15 Million Jackpot when he’s going home with just $4.9 million?

Talk about false advertising?!

I realize that in Powerball there is the option to take a lump sum upfront which cuts the whole thing in half (does Powerball roll the “left over” into the next drawing?), and then the government takes their cut, but touting it as a $15 million dollar prize when it’s actually less than one third of that seems a little… crooked?

Powerball’s website has the current jackpot amount in HUGE bold face at the top of their page — under it, the fine print which lists the “actual” cash value. So, as of today, according to them, $26 million is actually worth $11.9 million.

Um… Yeah, sure, that makes *perfect* sense.

Even still, just the $4.9 million should be a nice supplement to his income for the rest of his life. And really, if I were him, I’d go out and buy that flat-screen television.

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Amy ToyenToday is September 11th.

In some ways, I’m kind of glad that the “hype” that’s surrounded the date for the last few years has finally subsided. I mean, is it really necessary to commemorate every single anniversary? I think that sort of thing had gone a little too far in the United States. Everyday on the calendar is an anniversary of something — but does it have to be mentioned every year? I don’t think so.

Now I know, there are people out there that claim 9/11 is different and that its so we “never forget”. Well, I’m not sure anyone in the western world over the age of 15 will ever forget anyway. I know I haven’t forgotten.

I actually knew someone in the World Trade Center that day.

These days it seems most people claim that they knew someone who died on September 11th, so as to feel connected to the event (which, quite honestly, why would anyone want to have a connection?), but I think a lot are just blowing a lot of hot air to get attention or something. That’s sad.

I went to high school with Amy Toyen. I can’t claim that we were close. In fact, I’d have to say that I knew her older sister even better than her, but she knew my name, I knew hers, and we occasionally sat next to each other on the bus to track meets.

She was the “manager” of the track team in high school — a position she took over when her older sister Heather graduated.

What exactly does a “manager” do for the boys track team you ask?

Well, if you tracked down all of the members of the boys track team from her years in high school, I’d bet every single member would remember vividly that she was the girl who brought blow pops for all of us to eat on the bus ride home.

It sounds silly, but that’s just the type of person she was. For some of us, the blow pop on the bus rides home was one of the perks of being on the track team. Actually, when compared to running up hills repeatedly until you couldn’t feel your legs, I’d say it was the only perk. And it was because of Amy.

In addition to being the ever-popular supplier of lollipops, at home track meets, she maintained the score book — that’s where all of the competitors times, distances, and heights are recorded. Scoring a track meet is rather confusing when you get right down to it — but she was second to none.

Sometimes it was like she had the school’s all-time record book at her fingertips too — always handy when striving to break a 20 year old mile time.

In high school, I was a distance runner. I often ran 4-5 events per meet, but when the competition was stiff, the coach had me run my two best events — the long ones.

The first event of a meet was the 5000 meter. The second to last event was the 3200 meter. Looking back, it was probably set up that way so that we distance runners had time to rest between the two longest events.

Basically, I’d have about 2 hours to kill between my two events. More often than not, I’d spend most of that time leaning over the counter into the “tower” shooting the breeze with Amy…

“Hey, what was my time last week?”

“Amy, do you have a pair of pliers? My spike wrench snapped…”

“What time to I have to hit to qualify for State’s?”

“That kid over there from Tolland — can you see what he ran last year? I don’t recognize him…”

“Any chance I could get a blow pop now? Please? Pretty please?”

She always had the “right” answer to each and every inquiry.

When the news circulated that she’d been in the building, and it was confirmed when I saw her name go by on a ticker on television a few days later, I’m not sure that I was mad. Or even angry. My stomach was in a knot — I was shocked. And I was sad. Sad for her family and those who knew her, and yes, even those of us on the track team. She was one of the few ‘genuine’ people in our high school full of ‘entitled’ snobs.

They erected a statue of her at the local library where we grew up. I’m embarrassed to say I’ve never actually gone to visit even though I’ve driven by numerous times over the years.

I’ve seen pictures though and, for me, it didn’t do her justice. I prefer to remember her for her huge smile, her freckles, her oversized glasses, and with an extended arm holding out a blow pop. And that’s probably why I’ve never stopped by to see the statue.

I’m going to go out and buy a bag of blow pops today.

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Apple iPhoneLet me start by saying that I’ve never been on the Apple side of the fence. And I’ve never considered hopping that fence either.

I was going to hold off on this post until Friday, to time it with the iPhone’s launch, but I didn’t really want to add to the ridiculous hype already slated for the release… so here’s my take on it a few days early.

As you may have guessed already, I’m not going to buy a $600 iPhone (ever), but I am interested in how the market will respond to the device. Apple’s marketing machine is second to none, with a great track record to prove it, so I’m sure they will sell millions of these overpriced gadgets, but this is the first time they’ve drifted into an already saturated market.

How will it do, facing huge, not to mention established, competition from Treo, RIM, HP, Motorola, Samsung, LG, Sony Ericsson, and Nokia? Not one of those companies will be pushed aside easily.

And, nearly all of those companies already offer a device that can and will do what the iPhone does, except they do it much better, have been for months, for half the price, and that can fit in the palm of your hand.

What is Apple bringing to the table that isn’t already commonplace? What is the hype?

With the iPod, Apple exploited the fact that the MP3 player market had no clear leader. Sadly, for the general public, there are MP3 players available at Walmart for under $30 that exceed what the iPod does… weird how an overpriced memory card with a jack for headphones became a cultural icon — but that’s Apple’s marketing at work.

So, really, what does the iPhone offer that the other phones don’t? The touchscreen interface seems to be what a lot of the buzz is about. Oooooooohhhhh…

In all honesty, the whole touch screen with gestures deal seems like more of a gimmick than anything super useful. And not to be gross, but unless the touchscreen is fingerprint-proof, you’ll also be carrying around a microfiber cloth to watch your movies in oil-free goodness. Just think how much oil from your skin will transfer when using it as a touch interface or from your ears during a call. Just being realistic.

Oddly enough, being a bit of a geek, I also find it peculiar that a phone manufactured by a computer company would create a cellphone that will not serve as a wireless modem for a laptop, err, iBook. Is Apple abandoning their computing roots in favor of re-inventing Sony WalkMans and Nintendo GameBoys? Apparently.

The 80’s Brick PhoneAnd look at the size of the thing?! It’s almost as big as my corded phone at home. It’s like people are getting excited again about those brick phones from the 1980’s. Start lugging that thing around, you know, to impress people. Anyone still carrying a boombox on their shoulder? You will be soon, it seems; if the Apple trend continues.

Technology is totally going backwards. A couple of years ago, people wanted a 60 inch plasma TV with a surround-sound system but now the goal is to watch a movie on your phone with tinny sound through cheap headphones… I don’t get it.

Am I strange in that all I really want my cellphone to do is make telephone calls? Sadly, the reception on every cell phone I’ve ever owned leaves something to be desired.

Maybe if the previously mentioned phone companies concentrated less on the gimmicks like ringtones and camera features, the phones would actually work like, well, the old corded phones. Now that’s a feature I’d like featured on my phone!

Can you hear me now?

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Saw this in the local paper this morning…

Beginning July 1, the State petroleum tax is set to rise 6.72 percent to 7.53 percent, adding an extra 2 cents per gallon.

What?

Fractions?  YIKES!Seriously, I’d venture that it would be an accurate statement to say that your typical American struggles with the whole concept behind fractions. Hey, fourth grade math was tough, right?

Further, percentages are like fractions. In fact, they *are* fractions. Let’s not kid around.

Now, one step even further, in this article, they reference a percentage of a percentage?! Do you think many of the readers (actually, do the general masses even read the paper or watch the news?) can get a good grip on that? I highly doubt it.

Maybe that’s why they dumb it down for the simpletons, aka the general masses, by tacking on the “2 cents per gallon” bit at the end. But it’s not that simple.

Saying $0.02 per gallon sounds like a flat tax — but it’s not.

Like I said last month when I commented on the price of gas, the tax is dependent on the price. It’s a percentage of the price. As the price rises, so too does the tax.

By August, this 6.72 percent tax increase will likely be nearing $0.04 per gallon.

Funny, too, how they never mention in the article how much, per gallon, you’re already paying for this State petroleum tax.

Some bimbo pumping gas and talking on the phone…  I’m pretty sure you’re not supposed to do that.It is listed as a percentage, of course, on nifty stickers on every pump, but they don’t stick them front and center — you know, like a surgeon general warning on a pack of smokes.

Taking into account the federal taxes also built into the price of gas, if the public really understood where most of their payment is actually going and that gasoline really isn’t that expensive after all, well, it just might be time to break out the battering rams and catapults for a good old fashioned public uprising.

Shame that will never happen because so few care to read the sticker. And politicians don’t want to disrupt their easy, and somewhat hidden, income stream.

Makes sense… I guess?

Can You Dig It?

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