Wednesday, December 30, 2009
How The Rich are Debt-Free
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Hi,
===========================================
Crisis ???
The Rich are debt-free and do really have
a lot of options in life.
If you want to be rich, you must know
- what kind of income to work hard for,
- how to keep it, and
- how to protect it from loss.
That is the key to great wealth.
Discover this kind of income in:
===========================================
Cheers,
Labels: become debt free, debt free, finance course online
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Friday, December 18, 2009
Living on a Cash-Only Diet
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Credit card reform kicks in Feb. 22, but it won't matter to these 5 readers. They cut up their cards and are going debt free. They share how they did it
William Hazelgrove
William Hazelgrove, 49, is a novelist who lives with his children, Clay, Callie and Careen, and dog, Bach, in St. Charles, Ill.
William Hazelgrove Went cash-only: 4 months ago
My challenge: Tracking purchases
We were the quintessential American family: We were carrying $22,000 of debt. We would reach for our credit cards constantly, and eventually our interest rates went through the roof and our credit lines got restricted. We realized if ever wanted to live within our means, we'd have to switch to using cash only.
It's been a sobering reality check since we come from a long line of people who relied on credit. We're paying off our debt and realize it's going to take a while to adjust, but already we feel more empowered. We own everything we buy, and we don't feel like we're skating on the edge of a cliff.
We use debit cards, so we're constantly afraid of going over the balance because you can get slapped with service fees. Not all charges hit immediately so you're constantly wondering if you've accounted for everything.
My solution: I try to keep my debit card balance above $100 at all times, and I keep a cushion of $5,000 in an account for emergencies. I keep every receipt and enter the purchase into Quicken. I download the debit card transactions online and check them with the receipts.
I think through the downturn, more and more people are realizing they don't have a safety net. We're all pretty much a few steps away from the guy who just lost his house. We're our own line of defense.
We have a priority order for our expenses: mortgage first, utilities second, then food and medical bills. We've spaced out our due dates with the different bill collectors so we have some breathing room.
Brooke MacDonald
Brooke MacDonald, 28, is an account executive at a public relations firm in Annapolis, Md.
Brooke MacDonald Went cash-only: 1.5 years ago
My challenge: Managing unexpected expenses
After I got my first job out of college, I bought a house and a car and the expenses added up quickly. I was in an embarrassing amount of debt and would dread going to the mailbox. The bills would arrive and I would feel sick. But I still wanted to go out with my friends and buy fancy things for my house.
I eventually had an "Ah ha!" moment and decided I couldn't continue living that way. I wasn't in such a bad position that I was getting calls from my creditors, but I enrolled into a debt-management program. They helped me lower my interest rates and space out the due dates.
I went cold turkey one day and instead of using credit cards, I started to charge all my purchases on a debit card. I've cut my debt by about 20% in the last year and a half, and I expect to be completely debt free in another two years.
I really budget everything out, because I know planning ahead is my path to financial freedom. But sometime it can get sticky. It's cruddy when you have a big car service bill or want to travel.
My solution: I pay all my regular monthly bills and put some money into saving, and then see what I have leftover to do what I want with, which is usually about $600 each month.
I've known that I want to go to Los Angeles for the holidays for seven months, so I started saving for a hotel, a rental car and everything else back then.
For more spontaneous buys, I have a different system. If I decide I want to buy something, like a new outfit that costs $75, I set money aside for it for at least a week. If I decide it's still important to me after that period of time, I buy it.
John Wilder
John Wilder, 59, is a marriage and relationships coach and author in New Castle, Ind.
John Wilder Went cash-only: 3 years ago
My challenge: Reserving travel accommodations
I decided to free myself from credit cards because the companies were so aggressive with late fees, and those really downgraded my credit rating. I had become a slave to the credit card master. Three years ago I decided enough was enough and quit using my card and stopped making payments on $12,000 in credit card debt.
I still owe the money, but the credit card companies usually write off balances after seven years. It's killed my credit rating, but it was dead anyway because of my late payments.
When I tapped out my credit card, I realized I still needed one. We are forced in today's society to have a credit card. For example, most hotels don't allow you to check-in using cash, and car rental companies require large deposits.
My solution: I use a prepaid credit card, Wal-Mart's MoneyCard, which shows up as a normal credit card when I make a transaction, but it's front-loaded. It doesn't let you charge more than you have on the card; once you're out of funds, your purchases will be declined. There's monthly maintenance fee attached that's less than $5.
I've been using it for about three years, and life is much easier. I wonder why I never did it before. I will never return to a traditional credit card.
Alex Cohen
Alex Cohen, 28, is a marketing manager in Philadelphia.
Alex Cohen Debt free: 3 years
My challenge: Saving for big-ticket items
After graduating from college in 2003, I moved into an apartment in Philadelphia with a roommate and got a job. But I was young and didn't know how to manage cash flow. I racked up thousands of dollars in past due bills and credit card debt.
It became really stressful and was a wake up call to either figure things out or make more money. My parents helped clear my debt, and the last thing I charged on my credit card was a new laptop. But I put myself on a payment plan right away. I projected the day I would become debt free: it was 18 months away.
But now it's been three years and since that day, I haven't used a credit card at all. It was hard at first, and I have had to make a paradigm shift to really figure out how to anticipate and prepare for expenses before I have them.
My solution: I'm a goal-oriented person, so what works for me is to open up different savings accounts for every purchase goal I have. It's a concept I read about called incremental savings.
I have several ING Direct savings accounts (they don't require a minimum balance) that I use to save for various things: emergencies, a house, car repairs, vacation, electronics (I really like gadgets) and furniture. I have a certain amount automatically withdrawn from every paycheck to start saving toward each goal.
It's basically a credit card in reverse. Instead of having what I want now and owing the cost plus interest, I delay gratification for peace of mind. When I own it, I own it.
Dawn Tulman
Dawn Tulman, 39, is a small business owner who lives with her husband, Rob, and children, Zachary, Alexis, and Nicholas, in West Hills, Calif.
Dawn Tulman Debt free: 4 years
My challenge: Running a business
My husband and I used to fund all of our living expenses on credit cards when we were starting a software company with my husband's family. The business was doing well, but it would take at least five years for it to turn to profit. We realized it wasn't moving quickly enough for us. If you're buying groceries with your credit card, something's wrong.
We were in between $15,000 and $20,000 of debt and had to settle out most of our accounts. But now I haven't had a personal credit card in over a decade, and we've been debt free for about four years.
We forego a lot of things like vacations, Starbucks coffee and eating out. When we have large expenses, like replacing a failed transmission, we opt to use our savings. Otherwise, we would be paying more in credit card interest than we earn on our savings account.
But I own two small businesses and running those without debt is more challenging.
My solution: My husband and I run a computer services company, and since the business is more service-based, there often isn't a need to use credit. We have customers pay us the same day as the service, which helps us generate enough cash flow.
But once we had to install $10,000 worth of computers for a real estate company. My debit card has a daily limit of $5,000, so we made a deal with the customer to purchase the computers.
I also have a product-based company that I couldn't have launched without credit. I had to make an initial investment in 2007 to make the product before the first shipment was made at the end of 2008.
The product is a jewelry box with a hidden lock mechanism, so I'm meeting with a mainstream gift seller soon to have it sold in stores, and I expect that will bring in cash flow to help pay down the business debt. I'll still keep a credit card for the company because it's easier to keep track of expenses, but I won't let us get crippled with debt we can't pay.
by Hibah Yousuf
Labels: cash only, credit card, finance course online
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Monday, December 14, 2009
U.S. unemployed face higher healthcare premiums
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WASHINGTON (Reuters) - Millions of unemployed U.S. workers face sharply higher health insurance premiums and loss of coverage as temporary federal subsidies expire, a healthcare advocacy group said on Tuesday.
With the U.S. unemployment rate topping 10 percent, FamiliesUSA is urging Congress to extend a measure that helps laid-off workers maintain employer-sponsored health coverage with a 65 percent subsidy on their insurance premiums.
A report released by the group on Tuesday said without the subsidy, insurance premiums would consume a significant portion of monthly unemployment benefits and in nine states exceed the average jobless benefit.
The subsidies began in March as part of the $787 billion economic stimulus and the nine months of benefits for the first group of recipients expired on Monday. The program runs through December and anyone laid-off before the end of the month remains eligible for nine months of subsidies.
Some Democrats are considering extending the program as part of new legislation they hope to pass before the end of the year to address unemployment. The issue will also likely be discussed at the White House's jobs summit on Thursday.
But Republicans worried about record federal budget deficits are expected to oppose extending the program.
If Congress fails to act, anyone losing a job in January and subsequently would receive no federal subsidies to maintain employer-sponsored health coverage through what has become known as the COBRA program.
Under that long-standing law, workers who lose their jobs can keep their employer-sponsored health plans for up to 18 months although they must pay the full premium. For many laid-off workers, the $1,111 average family monthly health insurance premium is too much, the group said.
"When workers lose their jobs, they often lose their health coverage as well," said director Ron Pollack. "For millions of laid-off workers and their families, the federal COBRA subsidies have been a health-coverage lifeline."
The report said that average monthly family COBRA premiums vary range from $979 in Idaho and $989 in Iowa to $1,246 in Massachusetts and $1,232 in Minnesota.
Labels: COBRA, finance course online, health coverage, health insurance premiums
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Friday, December 11, 2009
Most Americans not confident about financial future
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NEW YORK (Reuters Life!) – There may be small glimmers of hope in the economy but most Americans are not confident about their financial future and many think they are already poor, according to a new survey.
More than 70 percent of Americans questioned in a Zogby International poll said they could imagine becoming poor or already think they are.
"What they're saying is that they're one, two or three paychecks away from poverty," said John Zogby, the CEO of polling company. "This has a huge implication."
Consumer worry about sliding into poverty has already dampened early holiday sales, with people spending less so far this year and often hunting for bargains, experts say.
While Black Friday and Saturday sales increased 0.9 percent over 2008, totaling $16.77 billion dollars according to ShopperTrak, shoppers spent less on average last Friday than in 2008, according to the National Retail Foundation.
The gap between current difficulties and people's expectations for the future might be due to the economic crisis not being severe enough to fundamentally alter consumer behavior.
"There is a contradiction playing out in front of us between hopefulness and hopelessness," said Jenny Darroch, a professor at Claremont's Graduate School of Management in California.
A third of people questioned in the poll said they hoped to be better off a year from now, while 34.5 percent said they would be about the same. But in five years from now more than half said they'd be better off, the poll shows.
Darroch said the numbers show there is a "hope that the crisis will come to an end soon."
But it also indicates that the recession has not fundamentally dented the way consumers will behave in the future.
"People are being told that the crisis is coming to an end," said Darroch, adding that when it does people will probably revert to the same patterns of consumption.
Yet for Darroch not everything will be the same.
"In the future people may feel like they have more money, but they may be very cautious about how they spend it."
By Basil Katz
Labels: finance course online, financial future, poverty
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Wednesday, December 9, 2009
Bank of America to repay TARP, raise cash
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NEW YORK - Bank of America Corp. said Wednesday it plans to repay its $45 billion in government bailout funds in the next few days, a move that will help the troubled bank recruit a new CEO.
The bank said in a statement it would use available cash and raise $18.8 billion in capital to repay the money, which it received during the height of the credit crisis last year and after its purchase of Merrill Lynch & Co. earlier this year.
Bank of America has been searching for a successor to CEO Ken Lewis since the bank announced in late September that he planned to retire on Dec. 31. But the bank, burdened with government restrictions and close oversight after accepting the Troubled Asset Relief Program funds, has so far been unable to sign a new chief executive.
"It removes the stigma that we've had as a company," spokesman Bob Stickler said of the planned repayment. "We become more attractive to a CEO candidate. Whether that means we get somebody external is impossible to say."
The bank has said it was considering candidates from inside and outside the company. Stickler said a decision is expected "in the near future."
Investors were relieved by the news, and sent Bank of America stock up 3.3 percent in after-hours trading.
"This will help with the CEO search by taking off the pay restrictions," banking analyst Bert Ely said. "The word you keep hearing with Bank of America and AIG is that the compensation issues are a problem."
Insurance company American International Group Inc., which received a $182.5 billion bailout after running into trouble with complex credit derivative securities, has also had recruiting problems.
Ely agreed that the restrictions put forth by federal pay czar Kenneth Feinberg have likely been an obstacle to finding the best possible CEO candidate.
"There could be someone saying, 'I'm not going to take this job unless you pay back the money and get out from under the pay czar," Ely said.
The Treasury Department said in a statement it was pleased that Bank of America planned to repay the TARP funds.
The bank said it has paid $2.54 billion to the government so far in dividends on the TARP money. BofA said it is not yet exercising its right to repurchase warrants that the government received in return for the bailout money. Warrants are financial instruments that allow the holder to buy stock in the future at a fixed price.
As of Oct. 31, nearly 50 financial companies returned a total of $72.3 billion in bailout money. Other big banks, including Goldman Sachs Group Inc., JPMorgan Chase & Co. and Morgan Stanley, repaid their bailout funds after they were given permission to do so by the government in June.
Treasury also made $6.79 billion in dividends from the TARP money and $2.90 billion selling warrants.
Bank of America received $25 billion as part of the initial round of bailouts when the credit crisis peaked last fall. It then received an additional $20 billion in January shortly after it acquired Merrill Lynch and it was learned that the Wall Street firm had billions of dollars in losses that Bank of America did not anticipate.
The bank said it will issue $18.8 billion in what are called common equivalent securities to help fund the repayment. It currently does not have approval from shareholders to increase the number of its common shares outstanding, but once it obtains that approval, investors holding these securities will be able to swap them for common shares.
Bank of America plans to hold a special meeting with shareholders in the next few months to vote on increasing the share count. The company also said it plans to raise an additional $4 billion from the sale of certain business units in the coming months.
Whoever becomes the new Bank of America CEO will have to deal with the rising losses on loans that all banks are contending with. Consumers unable to keep up with their bills have been defaulting on loans including mortgages and credit cards.
Bank of America lost $2.2 billion in the third quarter. Its losses were offset somewhat by investment banking income from Merrill Lynch.
The bank is also still facing investigations from federal and state regulators into whether it misled shareholders about the Merrill Lynch deal, including the fact that employees were given billions of dollars in bonuses shortly before the acquisition closed Jan. 1. At the time, Bank of America was also seeking the additional $20 billion in bailout money.
By SARA LEPRO, AP Business Writer
Labels: Bank of America, finance course online, Ken Lewis, tarp
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Monday, December 7, 2009
Recession intensifies GenX discontent at work
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CHICAGO - They're antsy and edgy, tired of waiting for promotion opportunities at work as their elders put off retirement. A good number of them are just waiting for the economy to pick up so they can hop to the next job, find something more fulfilling and get what they think they deserve. Oh, and they want work-life balance, too.
Sounds like Gen Y, the so-called "entitlement generation," right?
Not necessarily, say people who track the generations. In these hard times, they're also hearing strong rumblings of discontent from Generation X. They're the 32- to 44-year-olds who are wedged between baby boomers and their children, often feeling like forgotten middle siblings - and increasingly restless at work as a result.
"All of a sudden, we've gone from being the young upstarts to being the curmudgeons," says Bruce Tulgan, a generational consultant who's written books about various age groups, including his fellow Gen Xers.
This isn't the first time Gen Xers have faced tough times. They came of age during a recession and survived the dot-com bust of 2000. In recent years, though, more members of the generation — stereotyped early on as jaded individualists - had families or began settling down in other ways. It was time, they thought, to enjoy the rewards of paying some dues.
"We were starting to buy into the system, at least to some extent," Tulgan says, "and then we got the rug pulled out from under us."
Now, in this latest recession, nearly two-thirds of baby boomer workers, ages 50 to 61, say they might have to push back their retirement, according to a recent survey from Pew Research.
Meanwhile, on the other end of the age spectrum are Gen Yers, who are often cheaper to hire and heralded for their coveted high-tech knowledge, even though many Gen Xers consider themselves just as technologically savvy.
"It's so annoying," says Lisa Chamberlain, another Gen Xer who wrote the book "Slackonomics: Generation X in the Age of Creative Destruction." "First, it was always the baby boomers overshadowing everything. Then there was this brief period in the mid-'90s where Gen X was cool.
"Now it's, 'What are the new kids doing?' It's like 'Yo, hello, the Google guys are Gen Xers.'"
They can sound a little whiny. But there's also some evidence that Gen Xers really are being taken for granted at work.
One survey done this year for Deloitte Consulting LLP, for instance, found that nearly two-thirds of executives at large companies were most concerned about losing Gen Y employees, while less than half of them had similar concerns about losing Gen Xers.
The assumption is often that Gen Yers are the least loyal and most mobile, says Robin Erickson, a manager with Deloitte's human capital division.
However, she points out that a companion survey of employees found that only about 37 percent of Gen Xers said they planned to stay in their current jobs after the recession ends, compared with 44 percent of Gen Yers, 50 percent of baby boomers and 52 percent of senior citizen workers who said the same.
Everyone surveyed worried about job security. Gen X and Gen Y were most likely to complain about pay. But a "lack of career progress," was by far the biggest gripe from Gen Xers, with 40 percent giving that as a reason for their restlessness, compared with 30 percent of Gen Yers, 20 percent of baby boomers and 14 percent of senior workers.
Gen Yers, meanwhile, were more likely than the other generations to cite "lack of challenges in the job" as a reason they would leave, while baby boomers more often chose "poor employee treatment during the downturn" and a "lack of trust in leadership."
The Deloitte study warns of a "resume' tsunami" once economic recovery begins, especially among Gen Xers, and notes that many executives were largely unaware of employee complaints unrelated to money.
Such findings don't surprise Rich Yudhishthu, a 37-year-old Gen Xer who's a business development consultant from Minneapolis.
"The lack of promotional opportunities has pretty much killed job loyalty within a generation," he says.
Liza Potts, a 35-year-old professor at Old Dominion University in Norfolk, Va., agrees, but also notes that the disillusionment took hold for many of her peers as far back as childhood.
"Many of my friends had hoped to have jobs like their parents - places they would stay forever that would take care of them like they did their parents. But then we saw that start to crumble for our folks," she says, recalling friends whose fathers and mothers got laid off from companies such as IBM or had to relocate.
Now worried about their own foreclosures, debt and unemployment, her generation is left to do the soul-searching their parents did.
"Is there still time to become something different? Must we just accept where we are? Is there time to innovate elsewhere?" asks Potts who left her own career in the software and Internet industry for a life in academia. It's meant less money, she says, but also more freedom to choose her work hours and projects.
In Chicago, 40-year-old real estate agent Adon Navarette has taken on extra jobs to make it, from consultant for an energy supply company to starting his own health and wellness business. He's heard his peers sniping about other generations, but also thinks their experience with other rough economic patches makes them resilient, too.
It's a pivotal moment, he says.
"What's going to define me as a Gen Xer is how I come out of this. What's going to define me is, 'What have I done to allow myself to take advantage of the market when the market turns around?'" he says.
Sometimes, it means working for less money.
Jon Anne Willow, co-publisher of ThirdCoastDigest.com, an online arts and culture site in Milwaukee, is among employers who've recently been able to hire more experienced candidates for jobs traditionally filled by 20somethings.
They're hungry to work, she says. And as she sees it, that gives her fellow Gen Xers and the baby boomers she's hired a distinct advantage over a lot of the Gen Yers she's come across.
"When the dust settles, they'll be exactly as they were before and we'll just have to sift through them and take the ones that actually get it and hope the rest find employment in fast food," she quips.
Spoken like a truly jaded Gen Xer.
By MARTHA IRVINE, AP National Writer
Labels: finance course online, Generation X, GenX, recession
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Friday, December 4, 2009
U.S. offshore tax amnesty yields big response
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WASHINGTON (Reuters) – Some 14,700 rich Americans worried about a U.S. government crackdown on offshore tax cheats came forward to participate in a tax amnesty program, the top U.S. tax official said on Tuesday.
Participation in the Internal Revenue Service's amnesty program was "unprecedented" and the final number was nearly double the agency's estimate in October, U.S. Internal Revenue Service Commissioner Douglas Shulman told reporters in a telephone briefing.
The IRS amnesty program, which ended in October, offered reduced penalties for wealthy Americans who voluntarily disclosed previously undeclared foreign bank accounts and assets. "We were flooded with people coming in the final days of the program," Shulman said.
"The IRS has never got anything like that in response to prior initiatives," said Barbara Kaplan, a lawyer for high net- worth clients in New York. "It's a little higher than I anticipated based on the pace of my own practice and the panic that was out there."
While agency officials were still analyzing the amount of offshore assets and bank accounts disclosed, Shulman said "we are talking about billions of dollars coming into the U.S. treasury" from the amnesty program.
Of the 14,700 newly disclosed accounts, Shulman said many involved bank accounts in Switzerland and Europe, but assets were also hidden in more than 70 countries.
"The whole game around bank secrecy, around offshore (tax) evasion is changing" because of pressure from the U.S. Justice Department and from international capital markets, he said.
At the center of the U.S. efforts to combat tax evasion abroad is a case against Swiss banking giant UBS AG, which led the bank to agree to reveal the names of 4,450 client accounts.
Shulman also said the outpouring of hidden offshore accounts does not affect in any way the obligation of UBS to turn over those American account-holder names. There had been some speculation that success in the amnesty program would cut the obligation of UBS to turn over accounts.
"Some have misinterpreted this," Shulman said.
Although the amnesty program has ended, Shulman encouraged Americans with hidden offshore assets to continue to come forward and talk with the IRS about them. "It will be much worse for them if we find them first," he said.
CRITERIA
The U.S. and Swiss governments also released on Tuesday the criteria it used to arrive at the 4,450 accounts that parties agreed UBS would eventually turn over to U.S. authorities.
The Swiss Justice Department said it would hand over the names of wealthy U.S. clients of UBS with accounts holding more than 1 million Swiss francs ($986,200) where there is a reasonable suspicion of tax fraud.
Accounts of a lesser size could come under the deal where there is a "scheme of lies" identified, according to the document.
It describes suspicious activity that could be interpreted as tax fraud including the use of debit cards, cell phones or wire transfers to hide accounts.
Shulman said the agreement will give the U.S. accounts it is most interested in -- those where taxpayers exhibited the most egregious behavior, those that would be hardest for the U.S. to identify and accounts with the largest holdings.
Submission of data to U.S. authorities applies to UBS accounts held between 2001 and 2008 by U.S. citizens.
By Kim Dixon
Labels: finance course online, tax amnesty, ubs
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Wednesday, December 2, 2009
The Great Recession: The numbers tell the story
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NEW YORK - A year ago this weekend, the Dow Jones industrial average had just finished a slow-motion crash. Over eight days, it fell 2,400 points, or 22 percent, and stood at 8,451.
One year later, the Dow is at 9,865. It's up 51 percent from a 12-year low of 6,547 on March 9 - when some investors feared the financial world was coming to an end.
But the complete story of the Dow's journey since the economy soured goes back a little further. Two years ago this week, on Oct. 7, 2007, the Dow set its record high of 14,164.
What followed was a three-act play. For five months, from October 2007 through the collapse of investment bank Bear Stearns in mid-March 2008, the Dow fell 2,000 points in an orderly fashion as investors anticipated a garden-variety recession. From mid-March until Labor Day, the Dow rose and fell but was little changed.
Right after Labor Day, Fannie Mae, Freddie Mac, Lehman Brothers and AIG failed over 10 days. The credit markets froze, and investors panicked, fearing another Great Depression. There were rallies amid the downward spiral that ensued, but over six months - until the low on March 9 - the Dow fell 5,000 points.
So where do we stand today?
The seven-month rally since March has yet to wipe away all the losses, but few expected that the Dow would be edging back to 10,000 so soon. Unemployment is close to 10 percent, but other parts of the economy are stabilizing. Consumers are still hunkered down, but retail sales showed a slight gain in September. The panic of last fall has been replaced by the resignation that the worst is over but it might be years before the economy booms again.
"The problems that we're dealing with - there's a little bit less urgency," says Alan Levenson, chief economist at T. Rowe Price Associates. "We've stopped what could have been fatal bleeding."
Here's a by-the-numbers look at the stock market and the economy since the eight-day crash one year ago:
• $11.2 trillion: Total losses in the stock market from the Dow's peak in October 2007 to the March 2009 bottom.
• $4.6 trillion: Total gains in the stock market since March 9.
• 6: The number of the 10 worst point drops in the 113-year history of the Dow that occurred in 2008. The 777-point drop on Sept. 29, 2008, ranks No. 1.
• 3: The number of the 10 worst percentage drops that occurred in 2008. The Sept. 29 decline of 9 percent is the third-biggest behind 22.6 percent on Oct. 19, 1987, and 10 percent on April 14, 2000.
• 92 percent: Decrease in Citigroup Inc.'s share price from Oct. 10, 2008, ($13.90) to March 9 ($1.05).
• 341 percent: Increase in Citigroup's share price from March 9 to Friday's close of $4.63.
• 18-20: The historical average for the Volatility Index of the Chicago Board Options Exchange, also known as the VIX, or "Fear Index."
• 89: Where the VIX peaked last October.
• 23: Where the VIX was on Friday.
• 16 percent: The amount by which the Dow's closing level on Friday was higher than its average close the previous 200 days. Earlier this month the number hit 20 percent, the highest since the early 1980s.
• $6.5 trillion: Value of assets in stock mutual funds at end of 2007.
• $3.7 trillion: Value at the end of 2008.
• $4.5 trillion: Value at the end of August.
• -$72 billion: Net cash flow (money put in minus money taken out) for stock mutual funds in October 2008.
• -$25 billion: Net cash flow in March.
• $4 billion: Net cash flow in August.
• $9: The amount, out of every $10 investors put into mutual funds in August, that went into bond funds.
• $855.40: The price of an ounce of gold on Oct. 10, 2008.
• $1,048.60: The price of an ounce of gold on Friday.
• 6.2 percent: Unemployment rate a year ago.
• 9.8 percent: Unemployment rate today.
• 95.2: Consumer confidence two years ago. Reading above 90 means the economy is on solid footing; above 100 signals strong growth.
• 25.3: Consumer confidence in February — record low.
• 53.1: Consumer confidence today.
• 2.8 percent: Decline in retail sales in October and December 2008.
• 2.7 percent: Increase in retail sales in August.
• 4.75 percent: Federal funds rate two years ago.
• 1 percent: Fed funds rate last October.
• 0 - 0.25 percent: Fed funds rate today.
• 4.81 percent: London interbank offered rate (LIBOR), the amount banks charge each other to borrow money for three months, at its peak, on Oct. 10, 2008.
_0.28 percent: Three-month LIBOR rate Friday.
• -0.5 percent: Personal savings rate in 2005 as home prices were soaring.
• 6.9 percent: Personal savings rate in May.
• $975 billion: Credit card debt held by Americans last September.
• $899 billion: Credit card debt held at the end of August, down 8 percent.
• 7 million: Home resales in 2005, a record year.
• 4.5 million: Home resales in January at annual rate.
• 5.1 million: Home resales in August at annual rate.
• $245,000: Median price of homes sold in 2006 — record high.
• $213,000: Median price of homes sold last October.
• $195,000: Median price of homes sold in August.
By TIM PARADIS, AP Business Writer
Labels: dow, finance course online, Great Recession
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