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Inflation Nation and Weimar Republic discussed by Ron Paul Advisor Peter Schiff

Being a history lover, I know what happened to the German Republic after World War I. But it’s the first time I’m hearing about the Weimar Republic. Watch the video below and especially listen from 3:52 to 4:30.

Printing truckloads of new money is not the answer.

Americans!! Stop borrowing at a loss and start SAVING.

The laws of Physics are universal. Gravity does not forgiv, and American Way of life is not immune to the basic laws of Finance.

What will the US become ? Zimbabwe ?

A Loaf of Bread costs $16 million Zimbabwe Dollars in Zimbabwe. A beer costs millions in Zimbabwe.

Maybe Cramer is on to something when he says to get rid of stock you will need within the next 5 years…

Student Loans 101: What To Look For To Pay For College

Thanks to the The Simple Dollar for this article

“I recently received this email from a reader:

I need some Buyer Beware advice on how to choose a lender for a student loan with a parent as co-signer. My 19 year old will be attending university and he has to take out 100% loans. The annual amount is a hefty 50K. When I review the lenders listed on the university’s recommended lender list, I do not have enough knowledge to know how to choose a lender. The interest rate is always variable on any student loan when it is in the student’s name and the parent a co-signer. But there is a lot of fine print attending each loan that I simply do not understand. Given what has happened with the sub-prime mortgages I feel that I might be stepping into a black hole with the student loans. The two categories of sub-prime mortgages and student loans appear to be very similar.

Obviously, it’s going to be impossible to describe every type of student loan in a single post, so instead I will offer some basic tips for evaluating student loan options. I went through this process myself not all that long ago and the scars are still fresh in my mind.

General Categories

In the United States, student loans generally fall into these general categories:

Federal student loans to students
This group of loans include Perkins loans, Stafford loans, Federal Family Education Loans (FFELs), and Ford Direct loans. These loans are guaranteed by the federal government and are generally a very good deal. There are subsidized and unsubsidized versions (subsidized is better, as they’re basically interest-free while the student is in school) – the subsidized one has some pretty strict income requirements. The drawback is that they have a very low cap: $3,500 for incoming freshmen in 2007. In the past, rates on these loans have been very nice, but they are set to start approximating the rates on private loans starting later this year.

Federal student loans to parents
PLUS loans are federal government loans directly to parents for the purpose of paying for college. These are not loans that the student will repay – the parent is solely on the hook for them. Again, the rate used to be quite nice, but the rates are going up later this year.

Private loans
This is the meat and potatoes of it, the type of loan that most people will wind up having to take because other sources didn’t cover the cost of education. These are basically consumer loans from private lenders with no collateral, which often means that the rates are not particularly comfortable.

Six Tips For Comparing Student Loans

It is very difficult to offer concrete advice on which loan offers to take without looking at the options, but here are six tips that can help you separate the good from the bad.

Use the APR to compare the loans, not the “rate” The “rate” that many loans give out is not really very useful for comparison, because many loans with low rates have a ton of additional fees tacked on. The real tool for comparing the loans is the stated APR, which includes the various fees that they tack on. Remember, though, that APR isn’t perfect – it’s only an exact comparison tool for loans that have the same term. This, of course, means that you should…

Shop around thoroughly, regardless of the stated “rate” Many companies thus use a very low “rate” in order to attract your attention, then effectively do a bait and switch, giving you a loan with a very high APR and a low “rate” because of all the other stuff tacked on in the middle there. Thus, don’t toss out loan offers because they have a high rate – they may have low fees in other respects.

If you have difficulty with the APR and term math, ask what the monthly payment will be and multiply it out by the term For example, if you’re trying to compare a ten year and a twenty year loan, find out what the monthly payment will be for each and then multiply that payment by twelve, then by the number of years you’ll have the loan to see how much you’ll be paying total. Obviously, you want the smaller amount here.

Look at fixed-rate loans unless you think the Fed is going to significantly start dropping rates I’m not the right person to be giving long-term advice on where interest rates are headed. My suggestion is to talk to people in the finance industry (especially those you trust) and ask them whether they think the prime lending rate will be on average lower or higher over the next ten years. If they think higher or about the same, get a fixed-rate loan, otherwise get a variable-rate loan. I was luckily able to lock in some fixed rates in 2003 when loan rates were very, very cheap – I actually do better with my money in an HSBC Direct savings account than paying off my loans early.

High origination fees are usually a red flag If an origination fee for one loan is excessively high compared to the others, this may be a red flag, especially on a variable-rate loan, because the rate could skyrocket and the origination fee (tacked onto the overall balance) will really hurt you in the long run. Small differences aren’t usually that big of a deal, but if you’re looking at double or triple difference in origination fees, something’s afoot.

Check your credit report If the borrower or the cosigner have poor credit, the terms for the loan will likely be worse. Thus, one part of the process is to check the credit report of everyone who might be signing for the loan and then ensure that the people with the best credit do the signing.”

Whether your looking for rural home loans from USDA loans or simply taking a business loan, it’s good know your options.

It’s 3AM. Is your web site backed up ?

I’m buying website backup software called SiteVault. I tested it a few times. I’m convinced SiteVault will protect me from future mess ups by backing up website files and MySQL data files.

Why am I buying this?

One my favorite webhosts has been losing entire websites. To protect the guilty party, I won’t provide names yet. Shockingly they keep no backup. Maybe they don’t want to keep me, but I’ll deal with that later. They did offer to give me 1 month of free hosting. Fortunately, only my nonsignificant websites were harmed.

Anyway… I should have established a better backup system. With SiteVault, backups will happen daily, and I’ll receive emails confirmations to prove it.

Tip

If you decide to buy SiteVault, make sure you are clearly identify the directories that should be grabbed. Appartently SiteVault won’t download all folders in a directory unless you say which ones you want.

Buy SiteVault

Download a 30 day evaluation copy of SiteVault

Summary:

I purchased SiteVault backup software. SiteVault is a website Backup FTP & MySQL backup tool. It backs up your entire ftp directory and the mysql databases you specify. And do I really have to explain how backing up your website is related to financial success ?

Need another reason to backup and upgrade your software ?

Our friends at Build and Succeed got hacked. That small screenshot is what Build and Succeed looked like when it got hacked. I am not gloryfing the crackers ( evil hackers) and I am not linking to the hacked website. Consider yourself warned… Make sure you have backup.
Read more…

Considerations for future Homeowners

Guest post by Melanie Taylor of Loan specialists Think Money.

These are strange times for would-be homeowners. On one hand, property prices have dropped, bringing the dream of homeownership within the grasp of many who couldn’t afford prices at their peak. On the other hand, no-one knows how much further they’ll fall, so buying property does take a certain amount of courage – assuming you can get a mortgage.

At a time like this, in other words, ‘knowing your stuff’ is more important than ever.

You might feel there’s no way you can keep on top of all the news in the housing market, but the good news is you don’t have to. Get a handle on just four areas and you should be able to make an informed choice.

1. The housing market’s future

2. Your future

3. Renting vs. buying

4. Interest rates

1. The housing market’s future

The house price speculation you hear in the news every day is largely that – speculation. No-one can really know where prices are headed, partly because prices depend partly on confidence, so the very act of publishing predictions (as long as they’re from credible sources) can have a positive or negative effect on them.

Anyone can see trends in prices once they’re underway, but spotting a high or low is a different matter altogether – and that’s what everyone really wants to know, as selling property in a slump or buying in a boom can cost you a frightening amount of money.

Anyway, even owning a crystal ball wouldn’t necessarily mean you’d benefit from house price changes. Even if you knew when prices would bottom out, you might be unable to get the right mortgage at the right time at the right price. (The same is true when you’re selling a house – even if you knew when prices were going to peak, there’s no guarantee you’d be able to find a buyer at the right time.)

Your future

In all probability, you’ll have a clearer idea about your own future than the housing market’s. If you’re thinking about buying, maybe you should pay less attention to housing market hearsay and more attention to your own finances:

Income

• Work. Is your job secure? Are you expecting a promotion / pay-rise?

• Benefits. Do you receive anything from the government? Could you? Is this likely to change for any reason?

• Windfalls. Any one-off sums of money coming your way (inheritance, sale of assets, insurance pay-outs, etc.)?

Expenditure

• Debts. Do you owe money? How soon will it be repaid – and how much extra will you have to spend when it is? Could you do it any faster?

• Spending. Is there anywhere you could cut back? Could you cut back enough to save up for a deposit and / or create a buffer against negative equity and fluctuations in mortgage costs?

• Change. Any major lifestyle changes coming up? Marriage, divorce, starting a family… Would it make sense to assess their impact before you think about buying?

You can’t know what’ll happen to your finances in the next year, but your own future’s probably more predictable than the housing market’s. It’ll probably have more of an impact on you, too: losing $15,000 on a house might be bad news, but losing your job / having a baby / getting married could have a much larger impact on your lifestyle – and your finances. Plus, that $15,000 wouldn’t really be ‘lost’ unless you were forced to sell before the housing market picks up again.

Renting vs. buying

You might be worried about losing money by buying property in a slump. It’s a valid concern, but these two questions could help you make your mind up:

1. How much am I paying in rent per month?

2. How much are house prices in my area going down per month?

There’s no guarantee that prices won’t start dropping faster, but if you keep on renting, you know you’ll be losing money. Property slumps don’t last forever, so house prices will go up again – it’s just a question of when. On the other hand, a mortgage is a big commitment, so if your own future’s looking uncertain it might make more sense to rent for a while longer.

Interest rates

If you do decide to buy, understanding interest rates is absolutely crucial, as your mortgage’s interest rate determines how much your monthly payments will cost you.

Never underestimate the difference 1% can make. Remember that 6% is actually 20% higher than 5% – not 1%. Given the size of most mortgages, and the sheer number of years you’ll be paying interest, that extra 20% can make a huge difference.

Say you take out a $200,000, 20-year mortgage*. The interest on:

1. a 5% mortgage deal might be around $117,000

2. a 6% mortgage deal might be around $144,000

In other words, that 1% makes a difference of around $27,000 – over $100 per month.

* You probably won’t take out a single 20-year mortgage. Most homeowners sign up to a succession of shorter deals (often two or five years), which lets them reassess the situation when economic conditions change. But sometimes, when interest rates are really low, it can make sense to sign up to a 20-year fixed-rate mortgage – guaranteeing yourself 20 years of (relatively) low payments!

Guest post by Melanie Taylor of Loan specialists Think Money

Ten Steps To Financial Success For A Minimum Wage Earner

There’s an individual who comments on The Simple Dollar (and a few other personal finance blogs) who identifies him- or herself as “Minimum Wage.” This person is singularly focused on the issues of low wage earners, and while his/her comments can be frustrating, sometimes Minimum Wage is really effective at pointing out how some advice simply isn’t appropriate for people in that situation. What good is portfolio advice to a minimum wage earner? What good does it do to talk about how to buy a $200K+ house when you’re making $7 an hour? Not much.

I know where Minimum Wage is coming from. I grew up in a household with a far below average income, and while we may have done all right for ourselves, I grew up around people who existed in true poverty. Thankfully, I was able to take advantage of the great opportunities that life offered me – and the great foundation that my parents gave me as a person – and was able to find a better, financially healthy life where I could raise my children without a regular sense of necessity underlying day to day life.

But what can a person do if they’re in Minimum Wage’s situation? Here are the ten things I would do if I found myself only able to earn minimum wage.

1. Go rural.
It is far, far easier to make a living on minimum wage in a rural situation. There are many small towns where you can find a room to rent for $100 a month and a small apartment to rent for $200 a month. Yes, these really exist – I see them fairly regularly when I get out in the more rural areas of Iowa. Even better, these areas often have lots of jobs for minimum wage workers – I see lots of help wanted signs around these towns and notices inside of town halls and gas stations looking for workers.

2. Don’t drive.
A car is a giant money suck. There’s no ifs, ands, or buts about it, if you’re working minimum wage, your car is killing you. Ditch the car – get whatever cash you can from it. Then choose a place to live where you can get to work by foot or by bicycle. In a small town, it’s pretty easy to reach any other place in the town (and many places in the nearby countryside) on foot or by bicycle, and it’s something that people often do to cut corners.

3. Find the free stuff.
In towns of any size, there are resources available for the impoverished, from free dinners at churches to food giveaways to soup kitchens. The library provides free entertainment in the forms of books, music, and internet access. There are parks, recreational activities, and countless other things even in the smallest of rural towns. Look around for the free stuff and use it – it’s there for everyone to utilize. When you must spend money, be as frugal as possible. Ramen is very cheap, filling, and full of carbs, for example.

4. Don’t be proud.
Pride often keeps people from walking into a soup kitchen. Don’t let it. That kind of pride is an obstacle ground into you by a life in a consumerist society. People who are there to help you want to help you stand on your own two feet – give them that opportunity. Look for every opportunity to help you with your situation, from consulting to WIC to Medicaid to welfare (regardless of my political feelings on it, it’s definitely a resource someone in that position should use). If you don’t know where to start, start off by asking a pastor or a clergyman for help.

5. Minimize your required commitments.
Repaying debts? Call the debtors and explain your situation and ask for an abatement. This won’t get rid of your debt, but it can minimize your requirements for the time being. If you have children that you simply can’t support, look for opportunities to help you with that burden – your family is a great place to start, for example. Don’t saddle yourself with burdens heavier than you can carry or you’ll do nothing but collapse. You don’t become strong by carrying 500 pounds of weight on your back – you become strong by learning how to carry ten pounds, then adding more as you go along.

6. Take every side opportunity you can.
There are all sorts of little opportunities to make more money if you pay attention. Doing things like helping someone shingle a roof for $10 an hour cash is an opportunity you can’t let pass by. Free meals? Take them. Twenty bucks for helping an old man clean out his garage? Do it. Ask around for odd jobs and other small-scale moneymaking opportunities – perhaps even get started on your own “handyman” business.

7. Minimize your possessions.
There are a lot of reasons for doing this. The biggest one is that the more stuff you have, the more money you’ve wasted. Also, fewer possessions mean that you need less room to live. For a while, all of my worldly possessions (clothes included) fit in a single Rubbermaid tub – and that made it extremely easy to actually live in someone’s living room for a while.

8. Make a steely commitment to succeed.
Even after you’ve done all of this, it still takes some serious commitment to make all of this work. You can get yourself in a position where you’re not spending more than you make, but it takes commitment to stay there. Remind yourself every day that you’re not going to waste money and that you’re going to spend less than you earn this week – and this month – and this year. That’s the one way you can get ahead.

9. Save automatically.
So what do you do when you are making more than you’re spending? Take that extra money and put it into a savings account. But just doing that every once in a while won’t cut it. Keep most of your money in a checking account, then go to the library and use the internet access there to set up an online savings account with a big bank, like ING or HSBC. Set up an automatic savings plan there to withdraw $10 a week from your main checking – or maybe even more. Then walk away and forget about it. What will happen? After a year, you’ll have $530 or so in the account. If you’ve put in more weekly, you’ll have even more.

10. Educate yourself.
While you’re putting yourself in a better financial place, spend your spare time educating yourself. Take classes at the nearest community college and work towards some kind of degree. If you need to, transfer to a state university – if you’ve been working on minimum wage for a long time and are actually making strong progress towards a degree, they will help you big time with paying for it. The key is getting started – see what your local community college has to offer.

One final tip: don’t give up the dream.
If you’re working a minimum wage job, either you’re very young, very lazy, or very unlucky. All of these can be overcome, but they take time and commitment and a lot of hard work. It’s very easy to give up the dream of a better life when you’re doing this. Don’t. You can succeed and you will succeed if you spend every day taking steps in the right direction. Surround yourself with people who are also fighting to go in the right direction. Don’t be resentful of people in a better situation than you – instead, use them as inspiration and realize that if you keep on the path, you’ll get there too.

Thanks to thesimpledollar.com

I am a Lender on Kiva

I lent $50.00 on Kiva yesterday. Lending is not the same as Giving, but I still got a warm fuzzy feeling about my $50.00.

What is Kiva ? I took the liberty of quoting them wholesale:

See Kiva

”

We Let You Loan to the Working Poor

Kiva’s mission is to connect people through lending for the sake of alleviating poverty.

Kiva is the world’s first person-to-person micro-lending website, empowering individuals to lend directly to unique entrepreneurs in the developing world.

The people you see on Kiva’s site are real individuals in need of funding – not marketing material. When you browse entrepreneurs’ profiles on the site, choose someone to lend to, and then make a loan, you are helping a real person make great strides towards economic independence and improve life for themselves, their family, and their community. Throughout the course of the loan (usually 6-12 months), you can receive email journal updates and track repayments. Then, when you get your loan money back, you can relend to someone else in need.

Kiva partners with existing expert microfinance institutions. In doing so, we gain access to outstanding entrepreneurs from impoverished communities world-wide. Our partners are experts in choosing qualified entrepreneurs. That said, they are usually short on funds. Through Kiva, our partners upload their entrepreneur profiles directly to the site so you can lend to them. When you do, not only do you get a unique experience connecting to a specific entreprenuer on the other side of the planet, but our microfinance partners can do more of what they do, more efficiently.

Kiva provides a data-rich, transparent lending platform. We are constantly working to make the system more transparent to show how money flows throughout the entire cycle, and what effect it has on the people and institutions lending it, borrowing it, and managing it along the way. To do this, we are using the power of the internet to facilitate one-to-one connections that were previously prohibitively expensive. Child sponsorship has always been a high overhead business. Kiva creates a similar interpersonal connection at much lower costs due to the instant, inexpensive nature of internet delivery. The individuals featured on our website are real people who need a loan and are waiting for socially-minded individuals like you to lend them money.”

There you have it.

Oh No !!! 5 Tools to Track How Much Time I Waste Online

Ready to quantify how much time you waste/ online ? I hope that question didn’t offend you. Let me rephrase that. Are you ready to quantify your time on the computer ? Then read the following article: 5 Tools to Track How Much Time you Waste while Online

The price of Gold briefly hits $1,030 an ounce

Oil and gold jump to new records
The spot price for gold also briefly hit a record above $1,030 an ounce. Oil also hit $109.00. Some say oil will reach $200.00 in a few years. Are you planning to invest in commodities yet ? I’m still learning how…

How do I invest in the Chinese Yuan ?

Apparently, if your thinking 10 to 20 years in advance the Chinese Yuan might be a good choice… Pay close attention to Craig Karmin’s response to this question/statement: “How worried should we be about the rise of the Euro, I mean the Dollar look weak agaist the Euro.”

Some replies on Yahoo Answers
“Just buy a mutual fund or ETF that invests in Chinese stocks. You will get the benefit of effectively holding the Yuan. D” . Response from Heavy D

I know an indirect way. Buy a mutual fund that invests in Chinese stocks or buy Chinese stocks or buy them both. A rise in the Yuan will translate into a rise in the comparative value of the stocks when translated into U S dollars. Actually, the Chinese stocks will most likely outperform the U S stocks during the next 5, 10 and 20 years so you will potentially receive a double benefit.

Here are a couple of Chinese stocks traded as ADRs: CHL and ACH

Here are a couple of closed end mutual funds currently selling at whopping discounts to net assets: CHN, TDF.
Response from muncie birder

FHA Home Loans 101

Most Americans have little experience with financing a home, and even fewer have specific knowledge of an FHA Loan, versus various conventional loans. The initials FHA represent the Federal Housing Administration. This government corporation was established in 1934 for the sole purpose of helping Americans fulfill their dreams of home ownership.

A lot of hard working people, dream of owning a family home but simply don’t qualify for the loan or can’t afford the purchase with a conventional bank loan. The FHA is helpful because it caters to people who cannot afford a conventional bank down payment or otherwise do not qualify for PMI insurance. Through an FHA home purchase, the down payment may be as low as just 3% of the total purchase price. Plus most of the closing costs and fees can be included in the FHA backed loan.

The FHA does not extend the actual loan, but rather it insures the loan. Your local private bank may be the actual lender, but that loan if further backed by the FHA, which allows the bank to offer more advantageous terms. Since the rate and terms are set by the actual lender and not the FHA, comparison shopping for the loan is very important.

Some of the more beneficial features of an FHA Loan are the terms which allow a single or multi-parent household to purchase a home. The FHA Loan can also provide options for fixing up your existing home such as remodelling, home repairs or energy-efficient improvements and including the additional renovation costs in the loan. The FHA has provided some excellent avenues middle income or low income Americans.

Traditionally, FHA loans have gone to lower income Americans and have enabled many families to purchase a home they would not otherwise have been able to afford. After all, this program did originate during the time of the great depression when foreclosures were common, and cash was scarce.

Today, the FHA is a part of HUD U.S. Department of Housing and Urban Development. FHA loans typically offer low down payments, low closing costs and easy credit qualifying.

Important to the mortgage lending process, the potential lender assesses the prospective home buyer for risk. That analysis of the home buyer’s debt to income ratio enables the buyer to know what priced home they can afford. Other factors, such as payment history on existing debts, are considered and used to make decisions regarding eligibility and terms for a loan.

The FHA even offers a Reverse Mortgage. If you are at least 62 years old and live in your home which is paid off then the FHA Reverse Mortgage might be right for you. An FHA Reverse Mortgage allows you to take equity out of your home. It allows the home owner to turn his equity into monthly cash for living. In August of 2007, the FHA even added a new refinancing program to help borrowers hurt by the 2007 subprime mortgage crisis. That refinancing program is called FHA-Secure.

Want to experience the joy of home ownership but need a loan? The Federal Housing Administration has been helping people fulfill their dreams of owning a home since 1934. For more information on the this topic you can visit FHA Mortgage Limits page. This page allows you to look up the FHA mortgage limits for your area or several areas, and then list them by state, county, or Metropolitan Statistical Area. You can also learn more at FHA Loan Refinancing.