A day in the life or racism

In the year 2010, racism still exists and anyone who disagrees may very well live in a hole. Working in a large corporate environment, I often walk by a hundred co-workers a day with whom I am very civil and they reciprocate with smiles and a hello. But then an uncalled for, racially insensitive incident occurs which makes me think about how genuine those smiles really are. Apologies and excuses aside, a person had to prepossess those feelings and thoughts which in itself is inexcusable. It is a deflating feeling when incidents like this occur, especially when they are made directly at your ethnicity. Very few will argue that racism is ignorance or hatred; maybe a combination of both. When living in a culturally diverse area, maybe the most culturally diverse area in the world, you slowly find yourself blending in unaware of the aesthetic differences you possess. It is funny how fast that mask is removed and feelings of self-consciousness return. The gamut of emotions you feel come fast and hard, beginning with anger and ending with disappointment. Having gone to college in the mid-west, I once became intimate with these emotions on a daily basis. Truth be told, I will forget about all of this a week from now and once again blend into the melting pot...........until it happens again.

401k vs. Roth IRA video

http://www.youtube.com/watch?v=vf_hQ_l1pXA

Freedom Debt Relief Resolves Lawsuit

REDWOOD CITY — A San Mateo-based debt reduction company has agreed to shell out $500,000 in restitution to settle a lawsuit that alleged the business didn't have proper state licensing and mislead customers, a prosecutor said Wednesday.

Freedom Debt Relief LLC, which operates under the umbrella company Financial Freedom Network, offers to help people get out of debt by negotiating with their creditors, according to the lawsuit filed against the company. But Freedom Debt Relief wasn't licensed by the California Department of Corporations and they charged fees higher than allowed by law, the suit said.

As part of the settlement signed Tuesday by San Mateo County Superior Court Judge Carol Mittlesteadt, the company has set up a $500,000 restitution fund for customers who contracted with Freedom Debt Relief between Nov. 1, 2004 and May 31, 2008, according to the San Mateo County District Attorney's Office.

The company did not admit any wrongdoing and will send letters to the eligible customers, who can then apply for partial refunds, in the coming weeks. They have also paid $360,000 in reimbursement to the Department of Corporations and the District Attorney's Office, as well as $90,000 in penalties.

"(Freedom Debt Relief) made some mistakes." said Deputy District Attorney Chuck Finney, adding that the business did not intend to "scam" people.

According to the lawsuit filed against them in October 2008, Freedom Debt Relief,

and other companies under the Financial Freedom Network, advertised that they could make customers debt-free in 12 to 36 months, get debts lowered by as much as half and obtain money-back guarantees on service fees, among other claims.

In reality, the complaint says, the companies often failed to contact the customers' creditors and were unresponsive to customer requests. As a result, the creditors piled on late fees and additional charges, causing higher debt, lowered credit scores and bankruptcy for some customers, the suit states. The allegations against the other companies, which had names like Bills.com LLC and Freedom Tax Relief LLC, were dismissed.

"This is a vindication of our business model," said Andrew Housser, co-CEO of Freedom Debt Relief, "We're very happy that we will be able to continue doing business in California."

Housser said the company agreed to the settlement and paid the money as a business decision.

He said they did nothing wrong, but the case against them wouldn't end until they agreed to pay some type of restitution. With the lawsuit behind them, the 580-employee company, about 340 of which are in California, will begin to expand. Housser said he will hire about 200 more employees in California and Arizona in the coming months.

"Litigation is a huge distraction and expense," he said. "Now we will be able to start growing."

Under the settlement, Freedom Debt Relief has to tell clients how much time will pass before the company will begin negotiations with a customer's creditors. The judgment did not take a stance on whether the company had been operating without a license, said Finney.

Amazon continues strong growth

Black Friday's online sales were up 35% year over year, and early reports for Cyber Monday put the gain at 19.6%. Amazon (AMZN), as an online pure-play, has felt a lift from both these factors, but its execution in the e-reader category can't be ignored. While Sony (SNE) and Barnes & Noble (BKS) have already sold out of their respective devices, effectively taking them out of the game until early next year, Amazon's Kindle continues to fly off the shelves.

So, what's the prize for effective forecasting and a supply chain that can delivery on it? A new record!

Amazon had its best Kindle month yet in 2009, though it wouldn't reveal how many of the devices it has moved or the revenue it's pulled in from these sales. All it would say is that some buyers were buying more than one Kindle at a time, and businesses and organizations were picking them up in volume for employees or clients.



The lost revenue for Barnes & Noble and Sony may not be the enduring result of their respective e-reader debacles this year. As the category was starting to take off, both were grounded, unable to deliver on customer demand. So, the chance to yank some market share from Amazon, the industry leader, has gone unexploited.

Even more interesting is that the two competitors basically wound up marketing for Amazon. The hype that went into the new product launches for Barnes & Noble and Sony has ticked demand for e-readers higher, but there's only one place for the customers to go: Amazon.

In the meantime, the lost opportunity has complicated life for Barnes & Noble. Now, it's shipping Nook devices to customers who pre-ordered ... at the expense of its retailers. And, it's had to lower its full-year earnings forecast because it expected the holiday seas to be brutal, and it's had to amp up its spending to speed up Nook production.

Debt Settlement

If you watch TV or listen to the radio, you have seen or heard a debt settlement or debt negotiation commercial. As the economy worsens these services have come to the forefront of the financial world. I have been asked by several people, "what exactly is this service?" Simply put, debt settlement is an aggressive way of dealing with a consumers unsecured debts. The debt settlement company will propose a lower payback to the creditor and that payback will be regarded as a payment in full. Debt settlement was designed for consumers facing a financial hardship who are either behind on their monthly payments or are going to fall behind. These programs will help the consumer save money on a monthly basis as well as lower their total payback. The program is not for everyone. A good company will qualify you prior to acceptance. If you are thinking of filing for BK, you might want to look into this service first.

Foreclosures down from last month

According to RealtyTrac, the number of homeowners facing foreclosure dropped during October, thanks in part to foreclosure prevention programs, such as HAMP and other debt relief programs. This is encouraging for homeowners trying to gain freedom from foreclosure proceedings. More than 332,000 households (one in every 385 homes) were recipients of either a notice of default or a trustee's sale. This number is 3% lower than September, making October the third straight month with a drop in the number of homeowners facing foreclosure. As for homes actually repossessed, the number dropped to 77,000 in October from 88,000 in September.

One reason for the lower number of foreclosures is new state programs that require a bank to try and work with the homeowner before seizing property in an effort to provide consumers debt relief . In addition, some lenders are staving off foreclosures by evaluating consumers on the door step to foreclosure(no pun intended)who may qualify for the new federal loan modification program.

For the 34th straight month, Nevada led the way in foreclosures, despite best efforts to slow the rate of foreclosures. Las Vegas ranked in the unenviable top spot of cities, with one in every 68 homes receiving a foreclosure filing.

This statistic is positive relative to month over month data, but is negative relative to last year's data. The number of foreclosures is still 19% higher than a year ago. This statistic may get worse before it gets better as unemployment has also risen above 10% nationally.

Retailers trying to get consumers in the door this holiday season

Walmart has recently announced its low price guarantee heading into this holiday season. As retailers rush into the "under cutter's pizza" mode, consumers are reaping the benefits. The war on DVD pricing has already begun. When Walmart announced reduced prices on several titles to $10, Amazon followed at $9.99, with Walmart stepping back in at $9.98. The market among major retailers is intensifying, with many offering products as loss leaders in order to entice customers into the store. Along with Target (TGT) and Amazon (AMZN), Walmart is slashing DVD prices, the same tactic it's using with books.

If the book market is any indication, the low prices won't last forever. Preorder prices have been low, followed by gradual increases as the books have reached shelves. Nonetheless, the retailers are taking shots to the chin with every hot title, now whether read or watched on television.

When consumer spending is in the tank and consumers are focusing more on debt relief and debt freedom, retailers have few levers they can pull. Historically, deep discounting on certain items as a way to increase basket size has been popular, and sacrificing near-term margins for market share gains can deliver returns when the economy recovers. For now, however, the goal has to be to turn in a market-leading holiday sales result -- that's the number that sets the tone for the year. And, with many retailers closing their fiscal years at the end of January, it's the last big chance to make the year look good. Of course, this is all easier said than done with unemployment exceeding 10% nationwide.

Starbucks reports higher than projected for Q3

Shares of Starbucks (NASDAQ: SBUX) are trading up in after hours trading today after the company posted strong Q4 earnings numbers after the market close.

The company was expected to show earnings for the quarter of 21 cents per share on $2.39 billion in revenues. The actual numbers came in at 24 cents per share with revenues of $2.4 billion.

Same store sales were also strong for the quarter. During the previous quarter the company reported a 5% drop in same store sales, and that figure shrank to just -1% during the fourth quarter.

Looking ahead the company sees full year 2010 EPS growing somewhere in the range of 15 to 20% from 2009.

Shares of Starbucks are trading up 3.4% in after hours trading.

Debt settlement or debt negotiation

If you watch TV or listen to the radio, you have seen or heard a debt settlement or debt negotiation commercial. As the economy worsens these services have come to the forefront of the financial world. I have been asked by several people, "what exactly is this service?" Simply put, debt settlement is an aggressive way of dealing with a consumers unsecured debts. Their objective is to create debt relief or debt freedom. The debt settlement company will propose a lower payback to the creditor and that payback will be regarded as a payment in full. Debt settlement was designed for consumers facing a financial hardship who are either behind on their monthly payments or are going to fall behind. These programs will help the consumer save money on a monthly basis as well as lower their total payback. The program is not for everyone. A good company will qualify you prior to acceptance. If you are thinking of filing for BK, you might want to look into this service first as a road to your financial freedom.

Credit cards defaults still on the rise

For most of us, this is the worst economic decline we will see in our lifetime. The fallout is being felt throughout the economy but is most prominent in credit card defaults, which are rising and will continue to rise, according the leading analysts. As the economy worsens, consumers ability to attain debt relief becomes more difficult.Default rates are growing with two of the biggest credit card issuers. Bank of America (NYSE: BAC) saw its defaults rise to 14.54% in August from 13.81% in July. Citigroup (NYSE: C) saw defaults rise to 12.14% in August from 10.03%in July. Following close behind was JPMorgan Chase & Co. (NYSE: JPM) at 8.76%, up from 7.92%. The trend is clear. Defaults are on the rise and consumers are moving farther away from financial freedom. Banks are in a defensive mode. They are slashing credit lines to the bone, even for good customers, and raising rates to astronomical levels.Until we see defaults falling, things are not getting better.The credit bubble that burst last year still has a long run ahead of it. Foreclosures are still rising, as is unemployment, which hit a national level of 9.7% last month. Until consumer's financial situations stabilize, these trends will continue. When money becomes tight, credit cards are prioritized below mortgages and auto loans and will be the first debts to be defaulted and diminishing the dream of experiencing debt relief and reaching financial freedom.

McDonalds is not very McHappy

In 1999 a company started a restaurant in India and Malaysia called McCurry. McCurry serves local cuisine in a fast food manner very similiar to McDonalds. The McCurry logo is a chicken, not surprisingly colored red and yellow. Also, the manner in which the food is served is very similiar to the McDonalds production line model. McDonalds filed suit against McCurry in 2001 and won a ruling in 2006. Fast forward two more lawsuits with the country's highest court, McDonalds loses the trademark battle, though the menu does need to remain distinct from McDonalds. McCurry stated the Mc in McCurry stands for "Malaysian Chicken Curry". McDonalds released a short statement stating they respect the judgement and have no further comment. McDonalds currently has 185 restaurants in Malaysia.

Tax evaders found on facebook

If you owe taxes to the government, you may want to re-think starting or updating your activity in social networking forums. The government is becoming more creative in tracking down persons who owe money. Many states are exhausting all options to find relief and gain freedom from their huge debt. If you are self-employed and move around a lot, tax dodging can be easy to accomplish. States like California, which currently offer registered warrants(a.k.a. IOU's) for tax returns, are aggressively pursuing any avenue to recoup dollars owed. Their recent surplus auctions are one method used to find debt relief. When a California tax dodger was identified as a rigger of sails, a curious collection agent searched his name and the term online and found a discussion board used by local riggers. In one thread someone asked where the rigger was because his store had closed, and a reply was posted, "Oh, he moved across the bay." The agent found the man and collected a four-figure sum. One Nebraska agent collected $30,000 of unpaid tax from a resident after a Google search found him listed as a high-ranking local marketing rep for a national firm. Though not every state has adopted a policy of allowing their tax officials to use the internet, many are exploring the option.

Google to enter loan referral business

On Tuesday, Lending Tree filed suit in U.S. District Court in Charlotte against Mortech Inc. The suit claims Mortech violated an exclusivity clause by working with another partner, specifically Google. Mortech provides technology that helps automate lender offer pricing. This has lead many to believe that Google is contemplating entrance into the mortgage lead generation space. This was soon confirmed when Google, not party to the suit, responded to the lawsuit by saying,"We’re constantly looking for new ways to help people find what they are looking for on the Internet. As part of that effort, we are currently working on a small ad unit test that will run against a limited number of mortgage-related search queries in the US." Many believe the launch will begin as early as September.

FHA mortgage vs. conventional mortgage

As the housing market opens up, more first-time home buyers are looking to enter. Unless you are paying cash for the house, you will need a mortgage. There are two main types of mortgages available; FHA (Federal Housing Administration) and conventional. The main advantage of a FHA vs conventional loan is that the credit qualifying criteria for a borrower are not as strict as conventional loan financing and the down payment or Equity requirements are less. In comparing a purchase money FHA loan against a Conforming or A paper loan, the FHA loan will generally have the least amount of money required to close and the lower payment. FHA Loans will allow the borrower who had previous "credit issues" or those without a credit history to buy a home. FHA loans also require a lower down payment. Most conventional loans require a 20% down payment where FHA only requires 3.5%

One drawback to FHA loans is that the loan limits set for FHA loans are typically less than the loan limits for conventional financing in most parts of the country. If a borrower is looking for a mortgage that exceeds the FHA loan limits for the area, the borrower would have to put additional money down on the property or finance under a conventional mortgage. Under the 2008 stimulus package FHA loan limits have been raised in many areas and FHA offer FHA Jumbo Loans. Also,conventional financing does not require an upfront mortgage insurance premium when a borrower closes on the loan. With FHA financing, that fee for a 30 year loan is 1.75% of the loan amount that the borrower can wrap into the mortgage.

Struggling with debt but want to keep good credit

As the economy continues to struggle, consumers also struggle with their finances. If you are struggling with your debts, there are several options for you..... but all will come at the cost of your credit. Too often I hear consumers say," I need help with my debts but don't want to hurt my credit." This makes no sense to me. Other than renting an apartment or getting a cell phone, credit is used to..... well, get more credit. If you are struggling to repay your current debtors, why would you want access to perpetuate your problem? If you are struggling with debts, take care of these debts first(even if it means hurting your credit), so you can become debt free. Only then can you look to the rebuilding your financial future and starting your financial freedom.

401k vs. Roth IRA

I am commonly asked which is better. Both have great tax exemptions/deferments. Both also have max contributions. My simple answer is this. If your company does a 401(k) price match, exhaust that first. This is free money. Example: If your company will match 6% of your contribution, then contribute at least the 6%. You are getting 12% for contributing 6%. I would then contribute to the Roth IRA. The max contribution on a Roth IRA right now is 5k per year. This is a phenomenal investment vehicle as the any interest accrued is tax free, less early withdrawal. Also, you can withdraw any amount up to the principle invested without tax penalties as you have already paid tax on this money(Roth IRA's are post tax contributions). If there is any room to invest more, max out your 401(k). Be advised, there is a $15,500 max contribution on this vehicle as well.

The fall of Lenny Dykstra

Controversial former pro athlete Lenny Dykstra has now been added to the riches to rags list. Dykstra has been the center of controversy over the years as he was named in a sexual harassment claim, alleged to speak offensively about blacks, women, and gays, and was named in the Mitchell report as a steroid user. It was recently reported that Dykstra is facing foreclosure on his Thousand Oaks home. The house has been on the market for some time with little to no interest. Dykstra is reported to be $12 million in the hole for this house and Washington Mutual has begun the foreclosure process. He has already had a luxury boat repossessed. Ironically, Dykstra tried to start a magazine, the Players Club, aimed at helping professional athletes manage their millions. He dropped about $3 million of his own money and enlisted the help of icons including Wayne Gretzky, Tim Brown, and Ron Darling. The magazine failed after its first publication. This is quite the fall, as Jim Cramer had once crowned Dykstra," One of the great ones in this business," referring to day trading. Very few will argue that he was a great baseball player on the field, but his actions off have been less than stellar. Is he the victim of a bad economy or bad karma?

Netflix's Newest Competition

I have noticed automated DVD rental machines are popping up all over the place. Turns out the machine, also known as Redbox, are owned by Coinstar. The business model is a simple kiosk that rents new release DVD's. Because it cuts out the middle man Redbox is able to rent their DVD's for only 1 dollar per night. You can also return the DVD to any Redbox kiosk. Sounds harmless, but not according to Netflix CEO, Reed Hastings. Hastings has stated his biggest concern is not Hollywood Video, Blockbuster, or the internet, but rather Redbox. Redbox states they currently have 15,400 kiosks up and are installing a new kiosk every hour. At this pace, Redbox will become Netflix's number one competitor by the end of the year.

What is debt settlement?

If you watch TV or listen to the radio, you have seen or heard a debt settlement or debt negotiation commercial. As the economy worsens these services have come to the forefront of the financial world. I have been asked by several people, "what exactly is this service?" Simply put, debt settlement is an aggressive way of dealing with a consumers unsecured debts. Their objective is to create debt relief or debt freedom. The debt settlement company will propose a lower payback to the creditor and that payback will be regarded as a payment in full. Debt settlement was designed for consumers facing a financial hardship who are either behind on their monthly payments or are going to fall behind. These programs will help the consumer save money on a monthly basis as well as lower their total payback. The program is not for everyone. A good company will qualify you prior to acceptance. If you are thinking of filing for BK, you might want to look into this service first as a road to your financial freedom.

1st Time Homebuyers Tax Credit

To help stimulate the economy, Congress has provided a tax credit for first time home buyers. The tax credit allowed is up to $8,000. As with everything, there are limitations and rules so check with your local lender for specifics. This credit is good until Dec. 1 of this year. As home prices continue to fall, now is a great time to purchase a home if you are able. There is even talk about allowing the credit to be used towards the down payment and closing costs. The tax credit is great idea that will help facilitate new home buyer purchases. I have several friends who are looking to buy. They are on the fence because the cost barely fits their budget. This tax credit can help alleviate tight budgets. If you have more questions about the credit, check out http://www.federalhousingtaxcredit.com/.