Kristine’s blog

US stocks mixed on banks' ratings cut

nobody@vox.com(Kristine) — Wed, 17 Jun 2009 19:09:35 -0700

NEW YORK: US stocks ended mixed in choppy trading Wednesday as the credit rating and outlook of 22 banks were lowered and President Barack Obama unveiled financial regulation reform plans.

The blue-chip Dow Jones Industrial Average fell 7.49 points (0.09 per cent) to end at 8,497.18, its third straight day of losses.

The tech-heavy Nasdaq rose 11.88 points (0.66 per cent) to 1,808.06 while the broad-market Standard & Poor’s 500 index fell 1.26 points (0.14 per cent) to 910.71.

Financial stocks were hit after Standard & Poor’s lowered its credit rating and revised the outlook on 22 US banks, citing market volatility and tighter regulatory supervision.

The market was also dragged down by package delivery giant FedEx’s disappointing sales and earnings outlook after it reported an US$876 million quarterly loss.

“A disappointing forecast from FedEx and a rating cut for multiple banks weighed on stocks in early trading and eventually gave way to a broad selling effort,” analysts at Briefing.com wrote.

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The Dark Side of Credit Counseling

nobody@vox.com(Kristine) — Mon, 15 Jun 2009 19:54:28 -0700

When facing serious debt problems, consumers are often advised to seek credit counseling immediately. But did you know that turning to the wrong counselor for help can cause more trouble and frustration? Why should you be cautious when choosing a credit counseling agency?

How Credit Counseling Works

First, let’s discuss how credit counseling works. A credit counseling agency negotiates with creditors on behalf of the borrower. A credit counseling agency can ask for a lower interest rate or adjustments in your fees to make repayment easier for you. Most agencies have built partnerships with different lending companies so it’s easier for them to negotiate. In exchange for their services, some agencies charge monthly fees for as low as $10 to as much as $100 or more.

In extreme debt cases, a counselor may advise debt consolidation or debt settlement as possible solutions. Nevertheless, a reliable credit counselor should not focus solely on these two methods of debt reduction. More importantly, a credit counseling agency should help a person address the root of the problem. It should be able to teach about correct financial management strategies to help a client stay away from debt problems permanently.

The Dark Side of Credit Counseling

Unfortunately, many consumers fall victims to credit counseling agencies that take advantage of their financial situation. Some agencies actually charge expensive rates for their services. Some of them may insist on debt consolidation loan as the best solution to the problem. The unsuspecting client may agree to be part of a debt consolidation program, not realizing that it would bring more pain and trouble. What is the danger in signing up for a debt consolidation program?

Some consumers found themselves stuck in deeper debts after getting a debt consolidation loan. The reason? Their monthly interest rates unexpectedly increase right in the middle of their repayment. Under a consolidation program, a credit counseling agency may also volunteer to submit your payments to your creditors. However, instead of submitting your monthly payments, an agency can actually withhold your payments and not pay your creditors until the deadline. Many fake credit counseling agencies also charge hidden fees that can only add up to your burden.

These agencies don’t really care about your debt problems. They’re only after their own interests – and that is to make profits from your debts. Many consumers were forced to drop out of a debt consolidation program because they’re not making any progress. After resorting to debt consolidation, they had to file for bankruptcy as a last resort for their problems.

Don’t let the same thing happen to you. Before signing up with any credit counseling agency, carefully examine its background and reputation. Check from the Better Business Bureau if the agency has had complaints in the past. Even so-called “non-profit debt counseling organizations” can be a fraud. If you don’t take time to do your research, you can end up as a victim of these predators. Therefore, do your homework and save yourself from the dark side of credit counseling.

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US Dollar Down Over 1%, Japanese Yen Mixed as 10

nobody@vox.com(Kristine) — Wed, 10 Jun 2009 18:43:10 -0700

US Banks Say They Will Repay TARP Funds

• US Dollar Down Over 1%, Japanese Yen Mixed as 10 US Banks Say They Will Repay TARP Funds

• Euro Rebounds Against the Greenback Despite Dismal German Trade Results

• British Pound the Strongest of the Majors as UK House Price Declines Slow

• New Zealand Dollar Due to Face RBNZ Rate Decision on Wednesday

US Dollar Down Over 1%, Japanese Yen Mixed as 10 US Banks Say They Will Repay TARP Funds

The US dollar experienced sharp retracements on Tuesday, falling more than 1 percent against majors ranging from the Canadian dollar to the British pound. Meanwhile, the Japanese yen ended on a mixed note as many of the yen crosses consolidated below their recent highs, which is exactly what we’ve seen in the equity markets. Indeed, the DJIA was unable to break above resistance at 8800 and closed down 1.4 points at 8763.06 while the S&P 500 tested yesterday’s high of 946, but backed off and closed up 3.3 points at 842.43. Looking to the economic data of the day, the US Commerce Department said that wholesale inventories tumbled for the eighth consecutive month in April at a rate of -1.4 percent as businesses anticipate further declines in demand. In fact, sales fell a slight 0.4 percent during the same period, and the reduction in supplies helped bring the inventory/sales ratio down to 1.31 from 1.32. That said, this report is quite lagging, and as a result, wasn't very market-moving.

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How Debt Consolidation Can Help You

nobody@vox.com(Kristine) — Mon, 08 Jun 2009 22:03:03 -0700

Being stuck in huge debts can be frustrating and stressful and many people are left with only their jobs and homes to hold on to. If you’re in a similar situation, don’t lose hope. Instead, let this financial challenge put your money-management skills to the test.

Let Debt Consolidation Help You

In extreme cases, the best way to stop debts from further accumulating is to consolidate. By acquiring a debt consolidation loan, one can pay off all his existing debts to his creditors and clear all his charges at once. This prevents interest rates from adding up continuously and also eliminates late penalty charges.

Nevertheless, a debt consolidation loan isn’t 100% interest free. The good thing about consolidation is that by combining all your debts into one account, multiple fees are eliminated and your interest rate is significantly lowered. Furthermore, you’re instantly freed from the stress and hassle of dealing with multiple creditors and debt collectors.

If you have decided to seek consolidation, choose your lender with care. Search for lending companies that offer debt consolidation services and learn as much as you can about it. What are the rates and fees? Does the company provide flexible or easy repayment terms? Are the conditions fair and reasonable? Is the lending company recognized by the government and other national debt organizations? What do past and present clients have to say about it?

How to Make Debt Consolidation Work for You

As we’ve said, setting yourself free from debts would put your money-management skills to the test. After acquiring a loan consolidation, you’ll be confronted with a new obligation- to pay your debt consolidation company on time all throughout your loan’s term. To do this, you’ll need to pay attention to your spending habits and lifestyle.

Have you already created a monthly budget plan? A budget plan or repayment plan would help you distribute your income accordingly so as not to neglect or overlook your debt payments. If your salary is not enough to cover for everything- utility bills, personal expenses, debts- you’ll need to make some adjustments without compromising your debt payments. Remember, your priority at this time is to complete your consolidation loan payment as soon as you can.

In case of emergency and you think you won’t be able to pay on time, call your loan consolidation company right away and ask for an extension. If you give them advance notice, lenders would gladly extend your due date without reporting as late payment.

Unfortunately, some people who sought debt consolidation found themselves stuck in deeper debt trouble. The reason? They didn’t follow the budget plan they created and thus, were not able to submit their loan payments on time. The result can be dreadful as most consolidation loans are secured with collateral. To avoid this dilemma, be strict in following your repayment plan. It isn’t so easy and needs a lot of determination and discipline. Nevertheless, your sacrifices would be rewarded and debt consolidation would prove to be an effective solution for you.

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US calls for China to have greater say in world economic affairs

nobody@vox.com(Kristine) — Mon, 01 Jun 2009 18:07:53 -0700

China must be given a seat at the top-table of world economic affairs, the US treasury secretary, Timothy Geithner, said yesterday as he moved to reassure China that its investments in the US dollar were safe.

On the day US car giant General Motors filed for bankruptcy protection, Mr Geithner, said that mutual co-operation between China and the US was now fundamental to bringing the world out of the global financial crisis.

"China is already too important to the global economy not to have a full seat at the international table," Mr Geithner said in a speech at the University of Peking, promising to support greater representation for China in world financial institutions.

Mr Geithner also sought to allay growing Chinese fears that the value of the £475bn-worth of US treasuries held by China is in danger of being undermined by ultra-loose US monetary policy.

Last March, the Chinese premier, Wen Jiabao, who will meet with Mr Geithner today admitted that China was "concerned about the safety of our assets" as the US ran up massive debts to offset the effects of the financial crisis.

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How to Deal with Secured Debts

nobody@vox.com(Kristine) — Wed, 27 May 2009 22:08:03 -0700

Great deal

Car loans, home loans and debt consolidation loans are examples of secured debts. Secured debts are guaranteed by submitting the borrower’s home property or any form of valuable asset to his lender. This gives the lender the confidence that in case the loan isn’t completely paid, there’ll be resources to tap in to pay for the loan. In this article, let’s talk about how you can deal with debt problems particularly if your debt is secured with a property.

Car Loans. Usually, lenders have the right to repossess your vehicle if you default on your loan. You should be personally aware of your payment schedules since your lender isn’t required to give you notice before the actual repossession. Yes, it is possible to recover the vehicle but to do this, you need to pay off the rest of your balances on your loan plus the towing and storage costs of your lender.

If you think that you can’t keep up with your car loan, talk to your lender and request for modifications in your repayment term. Otherwise, it’s best to sell the car and pay off the loan before your lender makes the move for repossession.

Home loans. Typically, it takes three consecutive misses on your monthly payment before your lender sends a notice of foreclosure. Thus, it is recommended to talk to your lender at once, if you think you’re not going to be able to submit your monthly payment on your due date. If you know that it would be difficult for you to keep up with your monthly payments because of a financial crisis, explain your current situation to your lender and ask for a modification of your repayment terms.

Perhaps you can ask for extension of your repayment period or you may ask that your monthly payment be reduced. In most cases, home loan lenders are willing to extend a hand to their clients rather than proceed with foreclosure. Nevertheless, once the foreclosure process is started, you may have a more difficult time negotiating with your lender. You have greater chances of reaching an agreement with your lender if you take the appropriate action immediately.

Debt consolidation loans. Some people take out a debt consolidation loan to solve their debt problems. Although it is a viable option, it requires serious consideration. A debt consolidation loan is used to pay off all your existing debts from different creditors. In turn, your debts are combined into just one account under a single lender. The advantage of a loan consolidation is that it automatically stops your debts from continuously accruing multiple interest rates. With consolidation, you’ll only be subjected to a single and a lower interest rate.

Nevertheless, it doesn’t exempt you from the obligation to submit monthly payments to your lender. Since a debt consolidation loan is usually secured with collateral, failing to keep up with your repayment also puts you at risk of losing your home. And since you’ve already taken a debt consolidation loan, it would be a lot more difficult on your part to get another loan to save your home. Thus, before applying for a debt consolidation loan, make sure that you’ve set an effective repayment plan and that you’ll stick to it until your loan has been completely paid off.

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Chrysler, dealers await judgment day

nobody@vox.com(Kristine) — Mon, 25 May 2009 20:40:44 -0700

Fate of Chrysler's bankruptcy and hundreds of dealers depends on ruling from federal judge.

NEW YORK (CNNMoney.com) -- Wednesday is judgment day for Chrysler and hundreds of auto dealers, when their fate could be decided in bankruptcy court, but some experts think it's already a done deal.

The federal judge in Chrysler LLC's Chapter 11 case could decide on May 27 whether the automaker can pull its choice assets - its best-performing factories and dealerships - out of bankruptcy and sell them to a newly-formed incarnation of itself, called Chrysler Group.

"We're going to emerge from bankruptcy as a new company, hopefully if things go well, with the Fiat alliance being solidified," said Chrysler spokesman Mike Palese. "We're definitely on course. People are positive about its prospects and looking forward to the future."

But not everyone is happy about it. Chrysler, as part of its April 30 bankruptcy filing, wants to leave behind its multi-billion dollar debt and the underperforming dealers and plants it no longer afford. The strongest opposition comes from the auto dealers who resent being left behind.

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How to Find the Best Debt Negotiation Company

nobody@vox.com(Kristine) — Wed, 20 May 2009 21:58:03 -0700

Great deal

When debt problems become out-of-control and too difficult to handle, seeking help from a credit counseling agency or debt negotiation service may be your best option. If you’re having a hard time controlling your spending habits or managing your money, don’t be afraid to seek help.

Some people may have doubts or negative thoughts about seeking debt relief because some agencies turn out to be false and deceptive. But despite this reality, there are legitimate and reliable credit counseling or debt negotiation companies out there. All you need to do is choose carefully to avoid getting mislead. In this article, we’ll be discussing some tips on how you can find the best debt negotiation company to help you with your debt problems.

Research, research, research. With careful research, it is possible to find a debt negotiation company that genuinely helps people to get out of debt. Why can a debt negotiation company do for you? Negotiating with creditors is often the best way to get a new repayment term, waive certain fees or to reduce the amount of your debts. Debt negotiation companies deal with creditors all the time and they know how to get a good deal. . Of course, you can also choose to do talk to creditors on your own but if you’re not sure how to negotiate properly, a debt negotiation company can help you.

Check the company’s credentials. A debt negotiation company that is accredited by the government and national organizations is a better choice than company’s who have no reliable affiliations. You can also check from the Better Business Bureau if the company has had complaints or issues in the past.

Carefully examine the company’s policy. Different credit counseling and debt negotiation agencies impose varying policies and guidelines. As a general rule, a debt negotiation agency or a credit counseling service should not charge unreasonable fees from their client. More importantly, you should not be required to submit any upfront or initial payment unless the negotiation has already been done and the service or help you need has already been rendered.

Find a company that teaches money-management. Aside from negotiation on your behalf, a genuine debt relief service should teach correct money-management, planning and budgeting. Paying off your debts is just a step in resolving your debt problems. Addressing the root of the problem and avoiding new debts is the real and lasting solution to the problem.

Consolidate your debts the right way. Sometimes, debt consolidation may be recommended where the borrower would submit his payments to the debt consolidation company, who will in turn distribute his payments to his lenders. This may be necessary when dealing with multiple creditors. Your debt consolidation company may pay off all your high-interest debts first to stop your debts from accumulating. If this is the case, you’ll want to make sure that your payments would be submitted to your creditors on time.

Make sure that your debt consolidation company clearly presents the debt consolidation plan to be executed right from the beginning. Get in touch with your creditors to make sure that your payments are being rendered as expected. As a reminder, take note that debt consolidation should not be the only thing suggested by a credit counseling agency. Instead, you should be encouraged to work on a budget, pay your creditors on time, and handle your money with discipline and control.

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American Express Will Slash 4,000 Jobs, Take Charge

nobody@vox.com(Kristine) — Mon, 18 May 2009 19:40:12 -0700

American Express Co., the largest U.S. credit-card company by purchases, will cut about 6 percent of its workforce as cardholders squeezed by rising unemployment fail to pay debts.

American Express will take a charge of $180 million to $250 million in the second quarter, mostly tied to severance and other costs from eliminating 4,000 positions, the New York-based company said today in a statement. Additional reductions will be made in marketing and travel costs and consulting services.

The cuts, in addition to 7,000 job eliminations announced in October, may save about $2 billion in expenses this year, the company said. American Express has had to set aside more reserves for failed loans as surging U.S. unemployment makes it harder for customers to pay debt. The jobless rate reached 8.9 percent in April, a 25-year high.

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Getting Out of Debt in More Ways than One

nobody@vox.com(Kristine) — Wed, 13 May 2009 22:04:57 -0700

Card Shark

1. Pay more than your credit card’s minimum due. Some credit cards offer as low as 2% of minimum due. However, if you only pay 2% of your outstanding balance each month, it will take you a longer time to get off from debts. Prolonging your credit card balances means paying more from your interest rate charges. Furthermore, it puts a greater risk of exceeding your credit limit and accumulating debts.

To manage credit card debt more effectively, it’s best to pay off your balances in full each month. If it’s not possible, pay off as much as you can so you can to complete your payments at the quickest possible time. Paying off more than your credit card’s minimum due could mean giving up some of your luxuries or personal expenses. Still, making your credit card debts your priority is definitely worth it.

2. Pay off high-rate credit cards first. If you own multiple credit cards with existing balances on each, try to pay off your highest rate card first and work your way down. Or you can also consolidate your debts by applying for a 0% APR balance transfer card. BY transferring over your balances, you can save a great deal from not paying off the additional interest.

3. Consider borrowing from family or friends. Borrowing money from family or friends could mean borrowing with no interest. If you have past due bills, you may consider borrowing your payment so you can avoid the interest rates and late penalty charges. Remember, if a family member or friend is willing to lend you money, it is best to put everything into writing to protect your relationship

4. Negotiate with your creditors. If you’re really having difficulty in keeping up with your monthly payments, negotiating with your creditors is worth the try. Meet with your creditor and explain your current financial situation. You need to be honest and let your creditor know the circumstances why you’ve been late with your payments. Request for modification of your repayment terms so that paying off your debts will not be a burden.

Although, not all creditors may agree with your request, there are creditors who are willing to extend consideration especially if you show them your sincerity and willingness to stay true to your payment responsibilities. In fact, most creditors would prefer a modification or new repayment terms if there is a possibility that the borrower may resort to bankruptcy to solve his debt problems.

5. Create a repayment plan. Regardless of the solution you decide to take on, the only way you can make it work is to pay your creditors. Therefore, a repayment plan is really a must. You need to budget your monthly income in order to keep up with your debts. Yes, there is not a quick or instant solution to debt problems. Nevertheless, you can take positive steps to keep your situation from worsening. Remember, with self-discipline and motivation, getting out of debt is not impossible

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