Good Debt, Bad Debt

Handling Your Habits- From Feed the Pig

2011-07-18T12:33:00.000-07:00

Handling Your Habits- From Feed the Pig

Handling Your HabitsWe all have habits that we may not be entirely proud of, whether it's biting your nails or keeping those tattered t-shirts. At feedthepig.org, we identify some of the most common saving-hindering habits and suggest ways to overcome them, including shoe addiction, dining out, premium cable and the gadget habit. Check out the full habit list on our website.The big thing to remember is that, for most habits, it is unlikely that you will be able to have any major transformation overnight. You will need to take it one step at a time. Although there is no magic answer for managing every saving/spending tendency, here is a general overview of how to tackle your personal habits. Start nice and easy. Instead of grabbing your habit by the horns, ease yourself into the change by identifying baby steps that will be easy for you to adopt. Maybe you can't give up your daily latte, but perhaps you can try a smaller size. Take the leap. After getting warmed up, you can begin to make bigger changes. Think about your ultimate goal and the steps it will take you to get there. Then, figure out the next adjustment you need to make in order to move forward. Going back to our latte example, this may be the time to try limiting your indulgence to only a couple times a week; trying bringing your own from home on the other days. Dig deep. Once you're invested in changing your habit, and have been successful, it's time to move toward achieving your habit-changing goal. What future steps can you take to keep improving? Every goal you reach should help you reach your ultimate savings goal, so when you successfully change one of your habits, keep the momentum going. You've finally kicked the latte-a-day, and now only bring your coffee from home; how about taking the original amount you were spending on coffee every week and making a pledge to put that much additional into your savings? Find more tips for improving your savings and spending habits in the Feed the Pig Discussion forum, following @feedthepig on Twitter and visiting Benjamin on Facebook.

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© 2010 American Institute of CPAs

Don’t Believe the Doom on US Housing (at your own risk…)

2011-07-09T06:22:00.000-07:00

Sometimes when the reality doesn't quite jibe with your pre-established story line, it's best to pretend that up is down and down is up. Witness a recent post from CNBC.

Data from the US housing market has not made for nice reading in recent months but one analysts believes the worst could well be over and that if you take a closer look at the data prices are stabilizing. “The decline is mainly because the mix of homes sold has changed in favor of distressed sales, which typically sell with a 'foreclosure discount.' Non-distressed properties (sold by voluntary sellers) have already started to stabilize,” said Ajay Rajadhyaksha, the co-head of US fixed income strategy at Barclays Capital said in a research note on Friday.

The takeaway for all you sharp investors is that if you ignore the growing (note the word) effect of foreclosed homes in the recent home sales statistics, you'll notice that non-distressed properties at least aren't falling as fast. Of course this would be good news if foreclosures weren't rising AND foreclosed houses didn't bring down the values of all homes in their areas.
The latest S&P/Case-Shiller National Index fell 4.2% in the first quarter after declining 3.6% in the fourth quarter of 2010. The index had seen increases in 2009 and early 2010. With little government support, a collapse of new home building and sales, minimal credit available to the Jumbo mortgage market and 'settled' homeowners retrenched, it seems the only people selling in this market are foreclosures and those that have no other choice.
"Home prices continue on their downward spiral with no relief in sight," said David M. Blitzer, chairman of S&P's index committee. The report signals "a double dip in home prices across much of the nation," he said.

We wouldn't begrudge the National Association of Realtors if it were the organization trying to spin bad news into better news, but the fundamentals are pretty solid for continued malaise to a double dip in housing values.

(Repost from The Compass http://compassblog.net )

Cramer on Mad Money Says," Why Pay Your Mortgage?"

2011-05-26T05:29:00.000-07:00

Cramer on "Mad Money", CNBC, the other evening did a segment on how retail sales are up because a significant segment of the market has quit paying their mortgages giving them more disposable income. He even said, "It's insane to pay your mortgage if your home is underwater..." (owe more than current FMV). So now it's not just the subprime folks that never had income or a chance of paying, mainstream folks are buying into the game. With a tacit wink and a nod from a Wall Street TV Guru.

This is the inevitable result of government distorted markets that cause huge mal-investment by giving lenders (or ad-hoc brokers) an opportunity to lay off crap paper on the taxpayers. This allowed for privatization of profits and socialization of risk; while simultaneously making it more difficult for lenders to enforce contracts.
Cramer said, "Why bother (to pay?) live for a year or more for free."

Sadly his dystopian view is somewhat accurate. I am into about month 9 for a simple residential foreclosure on a personal note, with a good attorney following all the (new) rules.

Even Jon and Kate can qualify. First-time Homeowner Tax Credit Extended! Read Point Four Slowly…

2009-11-16T14:22:00.000-08:00

Forget whether you think it’s a good idea (I don’t). On November 6, 2009, President Obama signed into law the Worker, Homeownership and Business Assistance Act of 2009, which extends the first-time homebuyer tax credit of July 2008. This now applies for new homes purchased before May 1, 2010; if you are on duty overseas, your time is extended until May of 2011.

These changes include:

• A credit of up to $8,000 will still apply to qualifying first-time buyers.

• Higher income limits now qualify. The credit is reduced if your modified adjusted gross income exceeds $125,000 ($225,000 if married filing a joint return) and is completely eliminated if your MAGI is $145,000 single ($245,000 if married filing a joint return).

• A credit of up to $6,500 will now apply if you have lived in your home for at least five years and wish to purchase a new home.

• If you and your betrothed (marital partner) have maintained the same principal residence for at least five consecutive years in the eight year period ending at the time you purchase a new principal residence, you could qualify for a credit of up to $6,500 ($3,250 if you're married and file separately). What? Sounds like if you sold your house less than three years ago and had lived there for five consecutive years prior you could qualify for a credit. So if Jon Goslin and Kate get back together before May 1st 2010 and close on a house they could qualify. If we ship Jon to Afghanistan, which I am in favor of, it would extend Kate's peace for another year while she considers better options.

Want more? Visit the White House’s Fact Sheet on the Worker, Homeownership and Business Assistance Act

Jon Hanson is the author Good Debt, Bad Debt and Gooddebt.com
A Best Bet Self-Improvement Book “… bracing, snappily written.”
— People Magazine

Jack Miller, you will be missed. Best of the best real estate teachers dies.

2009-10-15T15:52:00.000-07:00

Note from Jon Hanson:

I had known Jack Miller since about 1983 and was first introduced to him by Jimmy Napier. He was without a doubt the funniest, smartest and most insightful teacher I have ever met. He was the original, all the TV hucksters copied a few of his ideas and wrote books and tried to do seminars like Jack. But they weren't Jack. Jack Miller was dynamic, changing, moving, adapting—those that tried to copy small parts were but small players because they only had that one trick they had copied. Jack kept learning and building on what he knew.

Jack would share a drink with you (if you were buying) and could discuss a "discount-sale leaseback with a collapsible wraparound over a subordinated land lease to a family limited partnership with the shares owned by a Charitable Remainder Unit Trust that his Uncle Floyd was trustee of” and lived in constant fear of some Polaroid’s Jack claimed to have filed away in a brown envelope addressed to the appropriately embarrassing people, Yes, Floyd liked being a trustee.

I think it was Jack that first said to me: "There is profit in confusion if you are the one causing it." (I'll spare you my comments on Health care right now). And jack was right. My friend Jim and I did pretty well buying tax sale stuff at auction and reading the archaic code on how to clear the title. We could buy because no one wanted to wait a year and spend a few bucks to clear title. Thanks Jack. In 1992 when Jack taught me about buying bad paper when everyone else was looking for good, I made enough to pay most of what I owed the IRS, which to me, was large at the time.

Jack taught me all contracts are really options if they are written correctly. Jack taught me to negotiate a killer deal at a low cash price with terms and then ask for a cash discount at the end—it’s brutal. But as Jack said, “It’s just commerce.” I could go on and on about all Jack taught me.

In January 2005 I was in a hotel in Chicago, Johnny Carson died the night before and most all of my TV interviews were cancelled to bring on “Johnny” people. My cell rang and it was Jack, I had asked my publisher (in November) to mail him a copy of Good Debt, Bad Debt and they did. Jack went on for almost one-half hour about the book and complimented me about the book. I was stunned. It was like getting approval from a father to me. That call was a highlight of my life.

I will always credit Jack Miller for the knowledge I learned about real estate. But more than that Jack Miller taught me “Real Estate Chutzpa.” And I can’t think of anyone else out there at this moment that has what Jack had. There is an African proverb that says, “When a great man dies, it is as if a whole library has burned down.” I don’t think one library could replace what Jack had.

Jack, you will be missed.

Jon Hanson

The post that follows is from the Cashflow Depot, Jackie Lange, and Arron Miller.

As many of you may have heard, Jack Miller passed away on October 9th after a short battle with cancer.

His final message to everyone was:

To my Friends, Students and Subscribers,

"I have concluded that the treatment for my illness will not be successful. However, I am thankful that I have had the friendship and support of many of you. It has been rewarding for me to see you grow and prosper and I hope I was of some help in that process. It is my hope that you will continue your efforts in the most ethical, enjoyable and profitable manner. Best of luck to you all." Jack Miller

~ ~ ~ ~ ~ ~

Here are some Q & A which Jack shared at CashFlowDepot which really apply to today's economy

What is the reason for inflation?

Answer:
          Inflation is caused by an increase in the amount of the money supply without a corresponding increase in the amount of goods or services in any economic system. The amount of money in use, or the monetary base is regulated by the Government which controls it through the banking system. When a Government is allowed to expand the money supply at will, without guaranteeing it with assets such as gold or silver, the temptation to produce more money than can be redeemed is overwhelming. Richard Nixon, Lyndon Johnson, Jimmy Carter all did this.

          When you elect public officials based on the PROMISES they make for more 'free' services with lower taxes you will eventually have inflation. Who's really to blame for inflation. We all are. Here's a test. Try to name just one Senator, Congressman or President who you or your friends elected because he ran on a platform of increased taxes, reduced services, massive cut backs in industry and unemployment? See what I mean? We all cause inflation.

Question:
What would happen to our real estate in a depression?

          Right after the war a fellow named Sewell Avery ran Montgomery Ward which at that time was neck and neck with Sears Roebuck competing for the front rank of retailers in America. He believed we were due for a recession, so adopted a defensive stance. Conversely, the managers of Sears bet on a boom in retailing and leveraged themselves to the hilt to gear up for it. We got the boom, not the depression. This allowed Sears to gain a lead never to be overcome by Wards. Avery's feared recession came along 20 years too late after he was dead.

           An alert, aggressive Investor usually finds a way to overcome his problems. Obviously, having some liquid assets at your finger tips would be good, if you could actually predict when a depression would occur. On the other hand, one can plainly see that if ALL your assets were liquid (i.e., cash, bonds, stock. etc.), you would be inviting another kind or risk. Suppose we had a runaway inflation, say 30% next year; these financial assets could be devalued to the extent that you might lose as much purchasing power as you would have lost if you owned highly leveraged properties and we had a depression.

          The key is to bet a little on both horses by having some houses free and clear and some leveraged to the hilt. You'll lose a little profit on the free and clear houses if inflation hits, but a house that doubles in value still yields 100%. On the other hand, if deep recession hits, you'll lose your leveraged houses, but keep those that are free and clear IF you avoid pledging all your assets or signing personally with full recourse on loans. Of course your wits and energy will be your best defense no matter what happens.

          Life would be simpler if we all had a crystal ball to foretell the exact moment to shift assets from one type of investment into another, but we don't - no one does! An informed inquiring mind, a healthy dose of skepticism, mixed with the ability to bet on one's own perceptions is the real key to security.

Question:
Say I own 50 single family homes approximately 60% leveraged with about $1,000,000 in equity. If we were to have a repeat of 1992 and 1993 with massive layoffs and foreclosures, what could I do to protect my investment?

Answer:
          First of all, I assume your portfolio consists of the right kind of single family houses. That is, decent housing in a decent neighborhood for decent people who are mainly employed because of their command of skills needed in the community. They will be the last fired and the first hired in most instances. Your tenants will be earning dual incomes and possibly have adult or working children who can help with the finances.

          You will have to be flexible in working with these people, and you can expect your rents to sag, but you will probably survive.   You might protect your investment by pre-paying your principle payments a year, and getting credit for a year's advance payment, thus if you fail to make regular payments when the recession strikes, you will still be ahead on the Mortgagee's books.

          Or you might sell some of your more risky investment houses and use the cash to protect the better, higher equity, houses. You are right in starting to look for remedies now while you have time.

Question:
This all sounds good, but what happens if we have another great depression like the thirties?

Answer:
          This sounds like a question a person would ask who has yet to begin an investment program, or one who has never known the defeat of being absolutely broke. We have found that the rich who inherit their wealth without effort and those on regular salaries are most nervous about a depression. The person who experienced a period of life where he had little or no assets, little or no income, and had to live by his wits, is less afraid of reaching that stage again because he has the confidence that he could again regain his present position in life. In short, he's better prepared with survival skills.

          I am not suggesting that those of you who are well off donate your assets to charity so you may join that largest of all majorities, the poor. I am merely making the observation that being broke can be a TEMPORARY condition as long as the person who becomes broke does not become content with his lot. Even if you are of the opinion that a depression is eminent, what have you to lose by trying some new investments now, if the final result is that we will all be broke once again? Nothing ventured, nothing gained.

Question:
When you are certain that the economy is going to collapse, what action should you take?

Answer:
          First get your personal situation under control. It's a lot easier to be brilliant and make your fortune when you have a dry, quiet place to live and a full stomach. Second on the list would be to contact those who you know have unlimited sources of capital and share your views with them. In the event you are wrong, you will have years to rebuild your reputation, and in the event you are right, you will have proven yourself to be an accurate forecaster. You will have their confidence for future investment. There will be many fortunes made by those who can recognize and capitalize on opportunities in bad times.

          Next, if possible, TAKE THE MONEY AND RUN!   Get liquid so that you may take advantage of the many negative cash flow opportunities which will present themselves. Realize your strengths and limitations, so you do not become just another loser, lost among the crowds or huddled masses. For those just starting to build assets, a depression is the best place to start. There will always be more sellers than buyers and prices will be at rock bottom. I went into Houston at the absolute bottom of the real estate crash there in 1987 and bought apartments at less than $1000 each for cash. Houses were going for as little as $5000 cash. It's only when you are cashing out that a high price has any true meaning. As long as you are still buying, pray for low prices.

Question:
In the event that houses for some reason unforeseen at present, became a bad investment, what would be your second choices?

Answer:
          Houses have nearly all the investment benefits available anywhere today! Rapid appreciation, cash flow, tax shelter and easy available financing. To replace the single family house in an investment portfolio would probably take a variety of properties. Since I don't know what you expect to happen to ruin the house market, let's just pretend there were no houses.

          The major advantage in a house is the appreciation which is untaxed until sold. We can realize similar appreciation in well located developed land, but will have to endure substantial negative cash flow while we hold because we would have to use leverage to maximize the return on our invested capital. By investing in discounted paper, we could get maximum cash flow on our invested dollar, which could offset the negative cash-flow on the land.

          I've invested for many years in pine tree forests. These sell at very high prices during periods when housing is on the rise, but when nobody is building, nobody is buying lumber. Still, my trees keep right on growing in size - and hence increasing my equity through actual growth rather than by means of financial appreciation. If I run short of cash, I can sell a few to pay property taxes. No management, no maintenance, no muss, no fuss. They're not bad.

          With land, there's always the possibility that we could erect a low cost structure such as a bill board or grain storage warehouse which would have very limited life on the land which we could lease out to recapture our investment in the building, at a high rate because of its short, useful life. Buy why bother. Today we can accomplish all of our objectives by owning a single house.

Question:
I keep reading about the deep depression that will strike sometime in the next few years. Like California's big earthquake, everyone seems to agree that it is coming, but no one can offer any specific actions we should take to prepare for it. What do you recommend?

Answer:
          It's always prudent to get some liquidity into reserve assets! Either you are going to be a passive or an active participant in any economic upheaval. If you are passive, and the dollar is still used as currency by us, money will protect you against uncertainty. If you are active, you will want to take advantage of all the distress sale activity that depression brings on.

          Remember, there were always plenty of people attending those RTC foreclosure sales who had the money to bid on cheap property. They became overnight millionaires, and so can the active investor. How do you get liquid? Borrow as much as possible on non-recourse loans! First use institutional loans then private party loans. If you'll agree to share opportunities, you'll find there will be no shortage of people interested in profiting from any downturn.

          Once your property is mortgaged to the hilt, sell options on it, or sell it with no cash down and retain the option to buy it back later. Exchange it into personal property (cars/boats, gems, etc.), and sell/borrow against it. Keep at it until you feel you have enough money to brave the storm. If you are really worried, buy junk silver coins and store your cash in a safe place just in case the currency collapses. Or open an off shore bank account denominated in a currency such as the pound, yen or franc. Keep about one-third of your net worth liquid, one-third free and clear, and the balance mortgaged to the hilt. That way, if you lose less desirable mortgaged property, there is little loss.

          Your more desirable property can be protected with your cash until it is time to start again- but bear in mind that if all those predictions are wrong, you will need to reinvest to keep pace with inflation. These are many safe harbors in a hurricane, but it takes a good captain to reach them in time. Don't forget to invest in your family and yourself , you may be all you've got some day!

Question:
What should one do to protect oneself against a possible depression of the economy as far as single family homes are concerned?

Answer:
          In a depression, people don't move out into caves and fields. They continue to live in houses and to pay rent. The problem is that they don't pay as much rent as often because they don't have jobs. At the same time that thousands of people are not paying rent, millions won't be paying mortgage payments. The banks will take a few houses initially through foreclosure suits, then they will become overloaded and will probably do what they did in the 80's in Texas; just stop foreclosing and wait for the government to intervene. In the meantime, the owners will be able to barter living shelter for maintenance services, paint jobs, medical care, groceries, etc.

          In a true barter economy where nobody will accept worthless dollars, shelter will command as much priority as it does in a cash economy once the owners learn to be creative. The best defense is to arrange your mortgage payments to be well below the amounts of rent you expect by refinancing loans now to stretch out payments at lower interest rates, or to leverage your property beyond the point the bank would want it back, or make it free and clear.

          You could just sell out cheap and retain a remainder interest or an Option to repurchase the property at a profit to the person who buys from you. Doing this would enable you to effectively share out the debt during hard times, and come back into ownership once times get better. Incidentally, these techniques also offer you a leverage opportunity just in case the depression converts to a booming inflation. In either case you will win. Remember, the big losers in any kind of economic upheaval are the unthinking savers, not the thinking investors.

Question:
In the event of a depression, how insistent do you think the banks will be in collecting the full principal and interest due them, and do you think they may settle for whatever cash they can get rather than foreclosure?

Answer:
          In studying historical behavior of banks during other periods of recent recession and depression, most banks will foreclose on several properties at the beginning of the recessionary period but then realize that the effect on their loan reserves in addition to the management of these properties is more than they want to handle. After the debacle of the late 80s where so many bankers were fired, jailed and/or driven out of the profession because of huge inventories of foreclosed properties, its doubtful that this will reoccur. They will look for alternatives which will make them look solvent. At this point, they may decide to make an "adjustment" with the present owner to continue to occupy or manage the property rather than to take on those management responsibilities themselves.

          Several times in our past history banks have given owners moratoriums on both principal and interest, and/or taken over the management of the properties for the owners, giving the property back to the owners after the economy has adjusted itself. Of course, an enterprising Investor with an in-place management team might obtain an Option from the Lender to purchase the houses at a future date in return for his providing management services or leasing foreclosed houses at marginal rents during the depression.

Question:
Right now, the banking system and government debt financing are in a precarious state. United States banking and financial institutions are more vulnerable to the public and to foreign depositors than in almost any other time in history. What would be the effect on a single family house portfolio if the government should turn to confiscatory taxation to put a lid on inflation and restore fiscal integrity to the Banks? Would there be a major housing crash?

Answer:
          I don't think single family housing will ever be a target of the government for the following reasons: Housing in this country is widely held by a majority of the citizenry. When Government attacks the homeowner, it takes on a formidable foe. Look at California's taxpayer revolt which generated Proposition 13. That's what happens and the Government knows it! It is a lot easier to pick on larger properties such as industrial, commercial, multi-family residential, where ownership is more narrowly held, often by non-voting corporations rather than by irate citizenry. The key to a housing crash will be REGIONAL problems (such as a mass exodus from the inner city, high tax states, cold climates, etc.), caused by Government policy as happened in the energy belt. Indeed, in a real crunch, the Government has traditionally stepped in and PROTECTED the home owner.

Question:
Every time I read a magazine or turn on television, I hear conflicting stories of inflation and/or impending depression. What can I do to protect my portfolio in a way which will hedge both inflation and deflation?

Answer:
          The future poses problems to every generation and to every age. No one can be certain of the course things will take. However, a defensive stance may be adopted. Consider the effect of refinancing part of your portfolio and using the proceeds to pay off the other part.

          If today you owned 20 houses all valued at $100,000 with $40,000 mortgages, you would wind up with about 5 free and clear, and with 10 mortgaged to the hilt through refinancing or sale. Your relative leverage is about the same, so your inflation hedge would be maintained. At the same time, your mortgaged property would not be attractive to a lender and would be safe from foreclosure in the event of depression, while your free and clear houses would still be capable of providing some form of income, even with reduced rents. This is only one of the many ways the mind can device to be prudent during turbulent times. Think about it and you'll find others.

Question:
How do you feel about investing in gold and silver as a hedge against inflation?

Answer:
          As a hedge against inflation, gold and silver both seem to keep pace, with gold possibly being more stable. However, most investors are not satisfied with merely keeping up with inflation, they want to keep ahead of it! Both of these metals (and they probably should not be grouped together as they have quite different market records) have similar benefits. Their primary appeal is that people seem to favor precious metals whenever the economy or competence of the government is uncertain.

          Metals have been a favorite in countries where real estate has been risky because of government regulation or government instability. However, in our country, small income properties have so many advantages over precious metals that we do not consider these as investments but rather protection against periods when the currency, as we know it today, loses a high percentage of its value. At that point in time, if you have invested in gold and silver and can find someone else who will take it for his real estate you will no doubt make some very attractive buys.

Question:
What areas are the best bets for long term investing in houses and why?

Answer:
          When I asked that same question recently to one of the country's largest and most successful investors he answered "New York City, Buffalo, Cleveland". I cut him off thinking that he misunderstood my question and he replied that in the next five years we will see tremendous opportunities in these areas which will certainly turn around before the end of the century.

          When most of us think long term, it means the next five years. I think when you narrow your investment medium to houses and small land parcels, and are not trying to catch dips in the cycles that areas go through, the sun belt has to be the best area to invest in. One reason why is our long term outlook for energy. Although it is unlikely that we will be unable to purchase the fuel we need, it is bound to become very expensive. When this commodity begins to command too much of the family budget, people will move south, family connections or not! We favor those areas with plenty of natural drinking water and away from major metropolitan areas that may be a target for mahem.

Question:
How can you work with banks and other lending institutions in periods when they are repossessing a lot of property?

Answer:
          Banks are in the business of lending money not managing property. When their staff has to adapt to the position of overseeing the operation of a real estate portfolio, especially one of empty houses, they are not only inept, but frustrated. They will be crying out for someone with a track record to take the property off of their hands to give them cash flow, they can thus, repay their depositors who will most certainly be in need of their savings and checking account funds.

          The Pro operator should try to arrange with the bank to manage their property for a percentage of the profits over the amount of the original mortgage that the bank NOW HAS INVESTED! Be cautioned to reduce such an arrangement to an iron clad option so that the bank will not reconsider its position in better times.

          Another strategy for those who are in stronger cash positions would be to offer to purchase defaulted loans from banks at discounts. Then choose carefully the mortgages you purchase, looking for those secured by properties which you turn around quickly. Now you can repeat this performance over and over again.

          One of my newsletter subscribers has discovered that government bureaucrats are little different from bankers when it comes to managing property. He has been earning over $200,000 per year for the past 5 years overseeing some 400 empty HUD houses in government inventory. It seems clear that being able to manage will earn a comfortable income in a downturn.

To Your Extreme Success

Jackie Lange

Aaron Miller
CREWorld Media LLC
crewealth@gmail.com
http://www.CashFlowDepot.com

Advice from a Pig: Pay as you go or credit? It adds up if you let it...

2009-10-12T12:58:00.000-07:00

Switching From Credit to Debit

Benjamin Bankes has long advised the smart use of credit cards and urges you to be mindful of how you spend your money, especially when using plastic. In July 2009, the Federal Reserve said that revolving credit use (primarily credit cards) dropped by $6.1 billion on an annualized basis. Additionally, Visa announced this past spring that spending on Visa debit cards in the United States surpassed credit card spending for the first time in the company's history. The increased popularity in debit cards can be attributed to Americans being more careful about how they spend their money during the recession.

In a nutshell, debit cards withdraw money directly from the cardholder's bank account, as oppose to credit cards which borrow money, often at high interest rates. Using your debit card for necessity purchases, such as food, clothing and gasoline, and saving your credit card for larger purchases only, may help you understand how and where you spend your money.

Overall, debit cards are a good alternative to using credit. Be careful not to overspend the amount in your bank account however, as you may incur an overdraft fee. Talk to your bank for more information on debit cards and overdraft fees.
Visit www.FeedthePig.org for more money-saving tips!

Real Soldierman

2009-10-08T09:59:00.000-07:00

Sgt. Titus Reynolds fallen soldier:
Words Pictures Story Click Here

Time is Money Do You Screen Spam?

2009-10-08T05:51:00.000-07:00

Spamicide: Man Spammed to Death While Checking His E-mail

by Jon Hanson

Death by spam is now possible with a new device by Microsoft. The device when implanted in the user's skull allows downloading of email directly into the brain.

Niles Bookbinder, 37, an assistant working for Jon Hanson, author of Good Debt, Bad Debt was accidentally spammed to death Tuesday morning using a beta version of a new email device called, "MS Mind." A Microsoft spokesperson said, "We don't have all of the bugs worked out yet, but this is the first death we know of." Mr. Bookbinder had unwittingly "unchecked" the spam filter in the MS Mind control panel. Without the spam filter, apparently Niles unleashed the entire world of spam into his "medulla interface" and was literally spammed to death. It's likely the last words Mr. Bookbinder heard were, "You've got mail!"

Wireless Medulla Interface providers are popping up everywhere. Dr. Jack Kevorkian sees the new Wireless "G" Medulla cards as a real advance for him. With these systems, euthanasia supporters predict quick, painless death by simply bypassing the filters and downloading thousands of spam emails quickly. Kevorkian said, "I have been looking forward to killing patients by email." Kevorkian expects his prices to be competitive with AOL.

While it is not a victimless crime, it would be a crime without a knowable perpetrator. You would have no way of knowing whether your "loved one" was finished off by the breast enlargement, Viagra softabs starting at $2.99, or $ave $$$ now refinance emails.

A PETA spokesperson, Ima Chihuahua, said she found the idea disturbing because it could lead to so-called Spam Collars that would be used to kill pets as they aged, or "convenience" killings, such as when a young couple could not find a kennel on their way to Vegas or they simply change their minds about having a pet.

PETA may be right. It has long been rumored that KFC has been testing the effectiveness of spamming chickens to death versus simply whacking off their heads. In earlier tests, chickens were forced to watch Gili and Ishtar until they simply cut off their own heads, but this experiment was discontinued because of the cruelty to experimenters.

Spamicide, accidental or not, will undoubtedly set off a bitter debate in America as Anti-Spammers and Right-to-Spam groups rally to raise money and jockey for political clout.

Obama press secretary Robert Gibbs seemed bewildered at this morning's briefing. He looked to his assistants and said, "Are we Right-to-Spam or Anti-Spammers?" Elsewhere, Jesse Jackson, finding it difficult to be Right-to-Spam said, "It should be the choice of the spammee. Spamicide should be legal, available, and rare."

NEXT WEEK: Partial Spam Deletion. Should this barbaric practice be outlawed? Are thousands of viable spams being killed in spam filters, just before being downloaded? The debate continues... If a spam is sent and nobody reads it--was it sent? Does spam begin at conception or on downloading?

Jon Hanson

myspace.com/hansondemo

Jon Hanson, is the author of "Good Debt, Bad Debt: Knowing the Difference Can Save Your Financial Life"

His web site is gooddebt.com

Video DNN-All Debt, All the Time

2007-10-19T11:07:00.000-07:00

Bankruptcy Bill is Bad Legislation for Many Reasons

2005-03-21T17:08:00.000-08:00

The so called Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 is a bad piece of legislation. Government should not be the credit card industries collector. In this unprecedented move congress gives special protection to unsecured lenders, making them quasi secured. If lenders don't like the losses they should stop passing out the credit cards like drunken sailors (my apology to sailors). My prediction is it will:

Increase Predatory Lending
Double the cost to consumers to file bankruptcy.
Harm the lower end of the credit and income scales.
Passage will not have the results intended (or results we were told)

I have been widely quoted for saying, "Credit cards are the crack cocaine of the credit industry." Now I add, "This bill is like legalizing crack and closing all the rehab clinics. I’m all for paying what you owe but let's not set up a system that further harms those at the bottom of the credit and income scale."
"DNN--Debt News Network. All Debt All The Time. You Borrow We Report." A little lighter news: http://youtube.com/hansondemo
Thanks for viewing. Jon Hanson