Chief Prognosticator » 2008 » February
Does it ever make sense to make extra payments on your mortgage? Well according to a Consumer Reports article I read today, it doesn’t. They compared paying $100 extra every month versus investing $100 a month in the S&P500 INDEX. What happened? Well if you looked at 15 year rolling periods, the stocks outperformed the prepayment return on your money 100% of the time! That’s food for thought.
That depends what the 1% is of. Your annual salary? Then probably not so big. How about the U.S. adult population? Sure that’s 2,319,258 people! So what is this all about? Well that’s the number in a new CNN.com article:
Report: 1 percent of U.S. adults behind bars
That’s significant because it represents 1 in every 100 adults. It’s the first time in modern U.S. history that the 1% threshold has been breached. What can be worse than that? Easy — the report that 1 in 9 adult black men are behind bars. That’s really sad and a shame for the entire country to bear.
Which empire? Any empire! There are two main things you need, whether it be a real estate empire or an online empire:
- A vision
- A start
You need a vision of where you want to be. That vision needs to be crystal clear — so clear that you can touch it. Writing a vision statement and revisiting it regularly would be a great way to do that. Secondly, you need a start — somewhere. No matter how small or large, a start means taking the first step in building that empire. It can be your first e-commerce website or your first apartment complex, but it needs to happen in before anything else.
No, I’m 100% serious about this. When my kids reach the legal driving age and beg me for a car, I will probably say yes, but there will be a few conditions. One of those conditions will be that I get to install a gps tracking device in the car. It makes perfect sense. Look, when I was a teen, I took some stupid risks driving. I think it’s universal — teens think that they are invincible. Only we as parents can know better and therefore we need to protect them. A gps tracking system like the ones available from GPS North America are the perfect solution. What can a gps tracking tool tell you? Let me count the ways. From the website:
The GPS system can inform you:
- If the vehicle is operated properly
- Where the vehicle stops
- How long it is there
- What route it took
- How fast it traveled along the route
That’s incredible! You can set these and more triggers to provide you via an email alert automatically. Another cool feature is that you can set a predefined boundary within which the car can travel freely.Past that point and you will be alerted instantly.
Seriously people — if you have a teen driver, this sort of system is a no-brainer. For your peace of mind and your child’s safety!
When I saw that headline at CNN Money, I just had to read the article. Like many homeowners, I want to both maximize the value of my home and to “live the good life”. Granite countertops seem to be a big part of both. In my new house, I was really excited that Silestone countertops were included. That saved me a $5000 renovation down the road. So what’s the deal with the article? Well basically it says that in previous years (say 1995-2005) a kitchen remodel job would return you about 90% on your investment. That means if you spent $40,000 on a new kitchen, you’d get to enjoy it as long as you lived there and then see your home value go up about $36,000 when it came time to sell. Nice, huh? That’s called “Having your cake and eating it too (off of granite countertops)”. But now, thanks to the downturn in the market, you might only see a 70% return on that investment, or in this case, $28,000 back. Will this really mean the end of the fancy kitchen? No way! But it is something to think about before you spend more money than you have on that remodel project.
The falling value of the U.S. dollar relative to the Euro, British Pound and Canadian dollar seems to have no end in site. I had to experience this first hand between 2005 and 2007 when I lived in Europe. I was still being paid salary in U.S. dollars and saw the currency fall from $1.22 to the Euro all the way to $1.40! That hurt!
But now the U.S. dollar has hit an all-time low! According to the Financial Times online, the Euro hit $1.51 in value today, shortly after U.S. Federal Reserve Bank Chief Bernanke testified the following to Congress:
What does that mean? Interest rates are headed lower for the U.S. economy even as inflation risks grow. This means fewer and fewer foreign investors will want U.S. Treasuries (since they pay less interest) and therefore devalue the dollar even more.
I knew this would happen — I mean, if I was still a Yahoo! Shareholder (don’t worry. I sold over a year ago), I would be really mad how the Yahoo board handled the latest Microsoft offer. Who turns down that much money? Does Yahoo have a responsibility to its shareholders? Well the news out today is that Yahoo is facing no less than Seven lawsuits related to the decision to shun Microsoft’s $44 billion offer. I hope the poor investors win!
Here’s something scary– gas prices in the U.S. have topped $3.10 a gallon average this week. What’s so scary about that aside from the obvious? This is the winter!!! Gas prices are usually cyclical in nature with the highest prices seen in the late summer, coinciding with the U.S. vacation schedule and hurricane season in the Atlantic. So if we are seeing $3.10 a gallon in cold February 2008, imagine what will happen when, not if, gas prices head even higher in the upcoming summer months.
The death of HD-DVD is here. No it wasn’t exactly here when Wal-Mart announced plans to stop selling them, nor was it when Toshiba gave up. But the death of HD-DVD format came this week as the 600-lb gorilla Microsoft announced that they will also stop selling the format for their XBox 360. The $130 add-on to the next generation console never real caught on with only about 300,000 units being sold. That’s far, far less than the 11 million Sony Playstation 3’s with their built-in Blu-Ray players. Adieu HD-DVD — we hardly knew you.
There has been a sellers boycott on eBay over the last week — did you notice it at all? That is, unless you participated in the boycott, did you notice anything different on the popular auction site? Chances are not! But maybe if you were looking for a specific item, you might have had a more difficult time…. Though probably not.
Will eBay’s shareholders see a difference? That’s the bigger question. Come next earnings report, will eBay miss expectations and will that be due to this selling boycott? Only time will tell.
