Archive for September, 2011

If the banking crisis, Bank of America’s role in that crisis, and the subsequent tax payer bailout haven’t been enough for you to dump the big banks and Bank of America, perhaps the new gall to charge $5 month for debit card usage will give you the courage to go check out a local credit union.    With the exception of one lone credit card, I have now officially dumped every big bank and encouraged many friends and family to do so as well and switched to credit unions.

I actually currently have FOUR different credit union accounts and plan to stay there forever.   The credit unions are typically non-profit and serve their members with rates highly competitive and often lower than most banks.    To find a credit union near you, click here.

 

 

It’s the ten year anniversary of 9/11 and I’m at home thinking about where we’ve been and where we’re going.  I cranked up my custom built investment application and was worried by what I saw:  Volatility in October.   It looks like there is heavy interest in buying puts (insurance) on this market for October and perhaps it a bit of the uncertainty  in Europe, the concerns about the US economy and other things in general but it’s starting to look like October 2008 all over again.  In the words of Yogi….”it’s deja vu all over again.”

Unfortunately, it’s put buying across the board and not the usual concentration around commodities or foreign countries as in the past so this time around, I am a bit worried.   I’ve long suspected this fed induced eurphoria wouldn’t last and with interest rates already near all time lows, I’m not sure where we go from here except a bleak depression and perhaps war.     I hope I am wrong, I hope nothing bad happens over the next month or two but the “future ain’t what it used to be.”

 

This is for all the people that keep ribbing me about my iPad 2.  With the help of a company called SquareUp, I have now officially turned my ipad 2 into a cash register.   The way it works is you hook up a little credit card reader (sent free) to the 3.5mm jack and swipe the credit card and voila money changes hands.    The app is fun and easy to use and a few days later, money shows up magically in your bank account.

I will say the tech support is a bit rough since there isn’t anyone to call and support is handled via e-mail at the moment but once everything gets set up, banking accounts cleared, and transactions flow it works great and I highly recommend it.

Now you may ask what will I use this for?

Well for starters, the next time I have a garage sale, I’ll be able to take credit cards.  The next time someone borrows money, I’ll be able to say, “just give me your credit card and I’ll swipe it on my ipad!”

I am also contemplating using it for community efforts to raise money.  It seems that the parents of Boy Scouts and Girl Scouts always seem to forget to bring their cash or checkbooks when fees for camping or annual membership are due but now I can swipe that credit card!

My son has expressed an interest in wanting to start a little business and now if he does, he can take credit cards after mowing lawns.   If you have a daughter that babysits, now the magic of paying with a credit card is readily available.   By the way, you don’t need an ipad, it works with an iPhone as well!

There is a somewhat steep 2.75% charge for  using the service but with no monthly fees it’s way better than anything else out there.

Once again, the iPad is a marvelous device transforming the world and I applaud Steve Jobs for creating it.   I can’t tell you how many things the ipad has replaced in my household.  The power, the beauty, the utility, and the simplicity is what will make this world a better place to live!

In the past few weeks I’ve opened a couple of new credit union accounts primarily because they’re being highly aggressive in seeking new customers and because they offer way better service and loan options.   Most credit unions offer credit cards at way lower APRs than big banks.   Most of my credit union cards have interest rates at 6.9% to 7.9% while my Amex and other big bank cards have APRs of 14.75% or higher.

It has never bothered me before because I pay off my credit cards in full each month but on the rare occasion where there is a 30 day period of overlap I’ve been  hit with finance fees of up to $70.    How does that happen?  Well just charge $10,000 and pay a day or two too late and you’ll know what I mean.    As such I am contemplating the unthinkable…..closing all my remaining big bank account credit cards.

I really see no need for them anymore as the cash back programs have been decimated and the lone hold out has been my Amex Costco card.    My credit union is also now sending me 0% APR checks with even lower fees than the big banks so why do I need any big bank accounts anymore?

The truth of the matter is that I’m still pissed off at big bank bailouts and I’ll never go back to doing business with the big bank cartel as long as I live.   I know have four credit union accounts to spread the risk and I’ll continue to open more and move my money there.

Interestingly enough, another reason why I am moving to credit unions is that they are adapting mobile banking and have iPad apps for my ipad than most of the big banks!

To summarize:  Credit unions offer lower interest credit cards, better local service, lower fees, more advanced technology features, and better loan terms.  Why do big banks exist again?  Oh yeah, so they can be too big to fail……

 

While it may be coincidental that the post office will be broke by the end of the year, my mail service has gone horribly wrong these past few weeks.  I keep getting my neighbors mail and packages are disappearing no doubt in other people’s mailboxes.

The post office is one of those places I despise greatly in large part because of the slow lazy pace at which the workers move in comparison to anything else on the planet.

I went back to look about the last major rant I had with the Post Office and found this gem from 2009.

The music industry has been under siege and the dynamic of the value chain for selling “albums” has been replaced with a new “singles” paradigm because of Apple and iTunes.    Flash over to another broken value chain -the college textbook cartel where infinitesimal changes in a college textbook seem to warrant the justification for full price payment of an already ridiculously bloated priced college text book for each subsequent edition.

While I get a lot of flak for talking about the iPad and the awesomeness of its capabilities on this financial blog, allow me to relay a recent story that has a direct financial impact on any college students finances.     I’m currently taking a marketing and finance class and as the new fall semester has started I had to purchase a couple of books for my classes.    A few years ago I would have balked at the idea of buying e-books because I love having something physical I can see, sell or share with others but the ugly reality is that I have a whole library of college books from my undergraduate studies sitting in bookshelves unopened for years.    I have now embraced the digital world because at least now my entire library goes with me where ever I go!

So I downloaded an app called “Kno” which offers 100,000+ college textbooks at reduced rates.   I figured I’d check to see what my books would cost via electronic format.    I compared the prices against Amazon.com where I get most of my college textbooks and sell them back at the end of the semester.

First up was my finance class.  On Amazon.com, the textbook has the following prices $151 (new), $80 (used), and $64 (trade in value).  On Kno, the same book in electronic version costs $95 to “own” and $75 to “rent” for six months.

My second class marketing has Amazon.com book values of $99 (new) and $33 (used) and buy back value ($29).  On Kno, the same book in electronic version cost $65 to buy only, there is no rent option on this text on Kno and no apparent way to sell back the book.

So which is best?   Curiously, Amazon did not offer electronic versions of these books even though they exist as evidenced by Kno so that does play a part in my decision making scenario.   If the electronic versions of these books had been offered on Amazon, I would have purchased the electronic versions for the sole reason that Amazon allows use on multiple devices such as my iMac, MacBook Pro, iPad and iPod.   It appears Kno would only run on my ipad and that is too limiting for me.    Because I travel frequently for business, I prefer electronic books that I can have with me on a plane, hotel, or other venue where I have time to kill.

Ultimately, I ended up ordering the physical books from Amazon because I had no other real options for ebooks (at least none that worked for me).   I can see the world is changing and in the near future I’ll be able to buy ebooks at greatly reduced prices and carry them with me where I go.  In the meantime I can only hope some savvy entrepreneur in China or Russia is getting a scanner ready with all these books so I can get them dirt cheap off the net.

 

 

So I recently purchased a new 27″ iMac fully loaded for a nice chunk of change and I looked back on my blog to figure out how long I had waited.   It turns out I had initially intended to buy it in 2008 but held off then in 2009, I got sacked because of the financial crisis and it’s now been two years and a month since that time and I’ve finally restarted to make large purchases.

To be fair, financial confidence actually happened sooner with a nice vacation to the east coast this summer but it’s interesting that financially prudent people really don’t dive into big expenditures until cash reserves and emergency reserves are fully replenished before taking a plunge back into the consumerist lifestyle.    Things are very different for me though because I’ve paid down almost all debt including mortgage and now have excessive cash reserves so it’s seemed appropriate to spend some cash.

This year I’ve taken two nice vacations, purchased an iPad and iMac and just purchased another iPad as a gift for someone special ;).   So where does that leave us now?   If we do hit another recession or dip deeper into more malaise then there possibly can’t be any economic boom until at least late 2013 or even 2014.  In the meantime, cash keeps tumbling in on my investment activity so I’ll keep chugging along.