Credit card companies take what they can
Posted 9 January 2009, 11:50 in Personal Finance 1 Comment
The New York Times reports that credit card companies are more than willing to negotiate debt with customers. Thanks to the recession, collectors know that Americans are strap for cash. Therefore credit card companies are willing to settle for a lot less than what is owed to them. In fact, the NY Times article states that some credit card companies are forgiving up to 70 percent of credit card debt.
Banks and card companies are bracing for a wave of defaults on credit card debt in early 2009, and they are vying with each other to get paid first. —Eric Dash, NY Times.
Of course, there is no such thing as free lunch. Consumers with forgiven debt will see their FICO scores drop as a result of this. The average consumer score will drop 70 to 130 points for someone with a strong FICO score of above 700 points. In addition, there will be a negative mark on your credit report that will last for 7 years, almost as bad as declaring bankruptcy.
Related Articles: Credit card companies take what they can.
Is Apple iPhone 3G really half the price?
Posted 24 July 2008, 13:49 in Personal Finance Leave a Comment
I often agree with Apple commercials. In their “I’m a Mac. I’m a PC.” commercials, I agree that PCs have more viruses and a lot of problems. After years of using Windows and finally making the switch to the Mac platform, I should know. However, in their recent iPhone 3G commercials, I totally disagree with their message. It is not half the price.
“Everyone” commercial transcript:
Some people will like surfing the web twice as fast.
Some people will like downloading stuff twice as fast.
Some people will like finding their way twice as fast.
But pretty much everyone will like paying half the price.
True, the cost of the actual phone is half the price, but it is because the new iPhone 3G is subsidized by AT&T. And don’t think AT&T is doing you a favor. They have worked the subsidy back into the iPhone 3G contract, which means you will be paying them back the subsidy and then some.
To summarize the new iPhone 3G plan: you will have to pay $30/month for its data plan compared to the original iPhone data plan of $20/month and pay an additional $5/month for 250 SMS text messages (250 text messages are included on the original iPhone plan).
Please be informed before purchasing on the basis of their advertisement because it is not entirely true. The additional monthly fees will more than make up for the half that you thought you were going to save.
Related Links: iPhone 3G – ‘Everyone’ commercial
Related Articles: How the half-price iPhone 3G actually costs you more | The Real Cost of the iPhone 3G
A sit down with Warren Buffett
Posted 7 March 2008, 15:57 in Personal Finance Business 1 Comment
If you did not know this by now, Warren Buffett is the world’s richest man alive, according to Forbes. At 77, he is the largest shareholder and CEO of Berkshire Hathaway, a holding company that owns the gecko at Geico, the fruits at Fruit of the Loom, and all the lactose at Dairy Queen. Buffett’s wealth came in the form of great investments into public companies such as American Express, Coca-Cola, and Gillette. He is admired by many, which is why 25 thousand investors make their way to Omaha, Nebraska to attend Berkshire Hathaway’s annual shareholder meeting.
A few lucky business students were invited to meet the man himself in a Q&A session (the entire Q&A session is linked below under related links). Below are some tidbits that I found interesting…
Why do you think that despite making your methods publicly available, that relatively few people have been able to emulate your success?People want to make money fast, but it doesn’t happen that way. Graham’s philosophy doesn’t promise enough for many people. You don’t know when it will happen, but you just wait for the fat pitches within your circle of competence. It’s not as exciting as guessing whether the stock price will go up the next day. Most investors in internet companies didn’t know the market cap. They were buying because they thought the stock would move, but if you asked them to write “I would buy XYZ company for $6 billion because”, they wouldn’t get halfway through the sentence. It’s the classic tortoise versus hare, bound to work over time. Charlie and I have educated competitors. Most don’t compete with us, though. It’s fine, we have more than enough money.
Given your business success, your immense fortune, and your celebrity status, how do you stay so down to earth and humble? Are there specific people or lessons you have learned throughout your life that enable you to maintain this outlook?I was lucky to have the right heroes. Tell me who your heroes are and I’ll tell you how you’ll turn out to be. One of your most important jobs in life will be raising your children. They will learn more from you than they will in graduate school. My father was a huge influence, and later on Graham came along. I was also never let down by my heroes.
What importance do you give to balance as it pertains to work and life and what do you do to maintain your appropriate balance?I have so much fun that it’s not work. In my own life I did virtually no social functions or meetings that I didn’t want to do. In my adult business life I have never had to make a choice of trading between professional and personal. I have simple pleasures. I play bridge online for 12 hours a week. Bill [Gates] and I play, he’s “chalengr” and I’m “tbone.”
There you have it: there is no such thing as quick money in the stock market, find the right heroes in life, and find a job that you enjoy so much that it does not become “work.”
Related Links: Notes from Buffett Meeting | About Warren Buffett | Berkshire Hathaway
Related Articles: Gates No Longer World’s Richest Man
