My 21 Money Rules (Learned the hard way.)

Tuesday, May 23, 2006

(01) Spend less than you earn! Save max in tax advantaged forms.

(02) Emergency fund equals a six month run rate.

(03) Save 10% for yourself; give 10% to charity.

(04) Insure the risks you can't afford to absorb.

(05) Separate your employment from your insurances, if possible.

(06) Understand your taxes that are deducted from your paycheck and the hidden ones like inflation.

(07) Value your benefits correctly. They may not be worth what you think

(08) If you have to ask the price, you can't afford it. Don't buy it!

(09) Pay off credit cards every month. If you can't, you can't afford what you bought. Take it back or sell it!

(10) Rent apartment if you have; buy a single family home as soon as you can.

(11) Buy your house to last a lifetime; pay it off in 20 years; no helocs; no refinance.

(12) Plan for your car to have at least a six year life; eight or ten is better.

(13) Finance that car if you have to for no more than three years; don't prepay it (rule of 78).

(14) Pay for six; first three to the credit union; after that to an earmarked savings account.

(15) That savings account is the maximum purchase price of the next one.

(16) Investments are not the emergency fund; not lotto tickets.

(17) Never invest in anything you can't explain to a child. Don't bet against the trend.

(18) No more than 5% in any one investment type, individual stock, or custodian.

(19) Special care if you buy your employer's stock; going belly up takes your paycheck and investment.

(20) When investing worry about roi first, taxes second, and risk third.

(21) Spend according to a lifetime plan; don't die too rich; don't enjoy life to save; you only go around once!


MarketSafe Gold Bullion CD from EverBank … some thoughts?

Tuesday, May 23, 2006

http://www.everbank.com/main.asp?idpage=pro_mscd&affid=eb&referID=11808

Ahhh, ain't gold wonderful. Bit not all that glitters is gold.

Take for example, the Everbank MarketSafeSM Gold Bullion CD

***Begin Quote***

A CD made of Gold. Invest by June 20, 2006.
Diversify, seek higher yields, and safely invest in Gold Bullion market returns. You can do it all with the new MarketSafeSM Gold Bullion CD from EverBank®.

This is the latest addition to EverBank's popular line of MarketSafe CDs. You'll enjoy many of the same great features and protections as the rest of the line, including 100% principal protection, market-driven upside potential, no account fees, and FDIC insurance.

A conservative investment with great reward potential, the MarketSafe Gold Bullion CD is a smart new way to invest in the Gold market. 
***End Quote***

It's really has no relation to a CD in the traditional banking sense.

Stodgy old traditional bank CDs pay a paltry amount of interest for locking up your money for some term. This, on the other hand, appears to be a straight gold play combined with a put at the current price at no cost with FDIC insurance?

So they get the use of your money for the price of a put and a call at the current price. Hmmm?

Thus, to the extent that whatever they earn with your money exceeds the cost of the put and call, they are a "winner".
Why wouldn't I just buy the put and the underlying coins myself?

Plus does the FDIC know they are insuring commodity trades?

AND, having worked on the Street, what about trading partner breaks, market discontinuities, and bankruptcies?

In short, all that glitters isn't, imho. 


Technology’s challenge: Easy to use! Understandable?

Tuesday, May 23, 2006

http://news.tbo.com/news/metro/MGBO3GM5INE.html

***Begin Quote***

Mike Palazzolo said he routinely faxes his daily special to regular customers. When a couple of them asked to be taken off his mailing list this year, the manager said he was unable to remove the numbers from his fax machine's speed dialer and instead entered a long series of identical digits in their place. He assumed those numbers would be meaningless, but they turned out to be Ebsary's fax number. 

***End Quote***

Now I am not sure if I believe the excuse. But it does point out that the side of technology that faces humans is often cryptic, forgettable, and the documentation stinks. I have about five cheap remotes at home whose instruction books are probably in some recycling landfill somewhere (don't distract me with that rant!). I can't program them but I can't part with them. So, I can empathize with this fellow. I see some hidden assumptions in this that make this little morality play even more interesting: (1) government "laws" that interfere; (2) free local calls; (3) Lawyers in general; (4) the fax machine maker (i.e., I sold it that end my problem. Now go ahead and use it. I dare you!); and (5)  an incomprehensible user interface. Dontcha just love it.


a spurious battle against an abstract noun … “war on drugs”

Tuesday, May 23, 2006

http://www.lewrockwell.com/orig7/floyd4.html

***Begin Quote***

The main engine of this mass incarceration has been the 35-year "war on drugs": a spurious battle against an abstract noun that provides an endless fount of profits, payoffs and power for the politically connected while only worsening the problem it purports to address – just like the "war on terror." The "war on drugs" has in fact been the most effective assault on an underclass since Stalin's campaign against the kulaks. 

***End Quote***

Well, I think we demonstrated the failure of yet another gummamint program.

Unless we don't understand that the "true purpose" of any gummamint program is to give more power to Father State and to get the serfs (what would you call people who have more than half of their earnings stolen by the ruling class?) to run to Mommy Government crying for "protection".

Interesting that the rate of addiction appears to be pretty consistent across human history. Interesting that we have given Father State our tacit approval to "discipline" ourselves. Like we couldn't decide what was in our own best interest. Clearly we didn't learn anything with the national experiment with Prohibition.

And, when it comes right down to destroying "drugs", the FDA has doen a fine job of making drugs expensive, unavailable, and dangerous. ("Dangerous" in that, unless the drug is SO SAFE as to be virtually worthless, it has zero chance of getting thru the regulatory process.) Like you and your doctor are too dumb to figure out what you need? And, the FDA has created a corporate protection welfare scheme that the big drug makers couldn't have created without the gummmint's help.

Note to self, when elected President: (1) End the unconstitutional wars (i.e., drugs, Iraq, Afghanistan, porn, etc. etc. etc. etc.); (2) Pardon all non-violent drug offenders; (3) Close the FDA; (4) Cut the Federal budget and taxes by the amount of the FDA; AND (5) Propose Constitutional Amendment forbidding Federalization of anything based on the mythical interpretation of the "commerce" or "general welfare" clauses.

Shouldn't the Federal Government restrict all of its "doings" to the fifty States? That's its constituents. Why should they interact with individual citizens? The Dead Old White Guys missed an opportunity to put another chain on the beast! Hard for them to imagine how stupid we could be. I can hear the conversation now "Tom (Jefferson), do you think we need to jot down that the Federal Government can't directly legislate to other than the fifty States? Nah, James (Madison), nobody would listen to them anyway. Like that restricting the general welfare clause you were talking about, we can save some ink because nobody would ever think of having everything run form New York (the original capitol)!" Yup, they must be stunned at what a mess we have made of it.


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