New commission panel investigating financial crisis

January 8th, 2010

The FCIC or Financial Crisis Inquiry Commission is putting pressure on the top country bankers and regulators so they can testify under the oath. The two chairman’s Phil Angelides and Bill Thomas told the news in the interview conducted that commission is putting plans ahead to call upon the Treasury Secretary Timothy Geithner and the Reserve Chairman Ben Bernanke to fully comply and testify under the oath in the months to come.

The panel which was established during last year crisis started slow but is slowly shifting into high gear and starting to make impact on the major banks and regulators. The main focus of the panel will remain to be, developing a detail investigation report which is due for December this year and will show the main causes of the financial crisis.

Mr. Angelides who used to be a former California State Treasures briefly commented on the situation and said “There is anger and confusion across this country, and people want to know”. He also indicated that one of the goals that FCIC has is to become a proxy for the American people in turning around and finding what happened during the crisis. He additionally pointed out that the main emphasis is on gathering the proper facts and evidence to uncover what really happened, rather then focusing on any specific people.

Tags: FCIC, financial crisis, financial crisis panel
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Discover Credit Cards: Their Future Market Share

December 27th, 2009

Five thousand years ago, the Mayans used cocoa as currency. Today, we use plastic… in the form of debit and credit cards. Just over the last few years, we have seen a surge in card payments.  Due to their versatility, security and ease of use, plastic is quickly becoming the preferred payment method for many.

In the United States, Visa and MasterCard are the dominant players; a 42.2% and 29.1% market share, respectively. American Express takes third place with 23.2%. Then there’s Discover Financial… capturing only 5.6% of the market. Considering the booming industry and Discover’s growing popularity, does this mean they will become a major player in the near future?

Organic Cardmember Growth
The industry was turned upside down in 1986, when Discover made its debut with no annual fee credit cards. Back then, almost every credit card charged an annual fee, so this in itself was a revolutionary concept at the time. On top of that, they were the first to offer cash rewards on purchases.

Over the years they have continued this same marketing strategy to grow the company. Today, the Discover Miles card (airline rewards) and Discover More card (general rewards) are two of their biggest hits. However with success comes scrutiny; some complain that their reward programs are confusing and not transparent enough.

Growth Through Acquisitions & Partnerships
Over the years the company has made a number of acquisitions to fuel growth, including the 2008 purchase of Diners Club (which was the very first credit card company in the world). They struck a partnership with UnionPay; which made Discover the most accepted American credit card in China. In Japan, they also have an arrangement with JCB network to process their cards.

Why Discover May Not Grow At All
Although the company appears to be poised for stellar growth both domestically and internationally, it’s possible they may not get any bigger than what they are right now. First and foremost, the credit card industry is cutthroat; competing against Visa and MasterCard is no easy task. Secondly, they have yet to gain acceptance in Europe – a very lucrative market. The bottom line is that only time will tell if Discover credit cards sizzle or fizzle.

Tags: credit cards, discover miles card
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US based Stocks are on the slight rise

December 14th, 2009

United States stocks jumped a little higher on Monday as acquisition activity provided has brought back the energy sector. Abu Dhabi’s investment of $10 billion into Dubai has given some temporary relief, however there are some major concerns over the gains being limited in the financial sector.

Dow Jones average was actually close to uplifted by 17 points in the 10488 trading. The best performer overall was the Merck, while the other players like HP and Kraft Foods have also helped with the measure uplift each contributing about 1%.

The big Exxon Mobil kept most of the Down gains in a total check. It went tumbling about 4%, after the major announcement was released that XTO energy was being all stock acquired in the net worth of $31 billion dollars. This is going to have major impact on the natural gas industry and their presence there.

Tags: dow jones, stock on the rise, us stocks, us stocks on the rise
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House decides to strike major blow to Wall Street

December 13th, 2009

The House of Representatives has decided to pass another legislation on Friday that completely changes or rewrites the rules of the major governing financial markets. This legislation is trying to restrict what the big banks and powers of Federal Reserve can do.

The legislation which was passed by the House of Representatives, if enacted would make the biggest change we have seen since 1930’s in the financial operations and rules. It would affect the business practices of majority of the players including mortgage brokers, traders on Wall Street and so on. This latest vote is a White House initiative that has been designed to attempt and tackle the effects of the last years big financial crisis.

However the White House is not saying that this is the final word. There has yet to be a decisions made by the Senate and the version that was brought up earlier looks different from the version shown by the House in many different respects. The main senators are trying to reach an agreement by the end of December which should then allow for the bill to be passed sometime in the first half of year 2010.

Tags: house bill, wall street bill, wall street legislation, wall street legislation 1930
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A Perfect Time to Restore Your Credit

December 11th, 2009

It has been more than six years since the Fair and Accurate Credit Transactions Act of 2003 (also known as FACT ACT) was signed by President George W. Bush. This act was created so consumers can acquire a free credit report every twelve months, and also included provisions to reduce identity theft.

According to TransUnion the percentage of bad loans and mortgages will decrease by late 2010. This may be good news for the country’s economy. If more consumers pay on time and keep their debts up to date banks will have more available funds to invest in the development of our country. But for those who have already messed up their credit ratings, it is not the end of the world.

Check Your Reports Regularly

Checking your free credit reports regularly will ensure that you are not a victim of identity theft. These can be acquired from any of the credit bureaus, and it provides a pretty clear idea of why you have a poor credit rating. This will also help you or an agency with credit restoration.

You can file a dispute if there is something inaccurate in the report. An inaccurate report may mess up your credit rating and prevent you from getting that much needed mortgage. By the end of year 2010 until the early 2011 more people may need credit restoration due to the recent years’ poor economy.

Bad loans and mortgages messed up the US economy and so thus a lot of lives. But a recent report from economic and financial analysts showed that the net worth of Americans went up. This was computed by deducting the consumer’s liabilities such as debt from credit card and mortgage from their assets like real estate property, savings account, stocks etc…

Recovering From a Financial Disaster

One of the first things that you may want to do after a financial disaster is to have a credit history restoration. This will allow you to be approved for loans or refinancing, post paid plans such as DSL and mobile plans, or a loan for your business.

If you are an excellent mathematician or gifted with a superb analytical skill then you may be able to fix your own credit rating. If you can’t afford to have your already messed up credit rating get any worse then get an analyst to help you. It is worth it especially since your future is on the line.

Tags: credit rating, credit report, credit restoration, FACT ACT
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The High Cost of a Low Credit Rating

December 10th, 2009

We all live in a world continuously revolving toward a digital era. Today having a mobile phone and an Internet connection seems to be a necessity. We now heavily rely on our computers and mobile phones just to get things done.

We all need a house to live in, food to eat and clothing to wear in order to survive. If you don’t have cash you will need a mortgage and a credit card to pay for these basic needs. Having a poor credit rating can get you in trouble. A good credit rating can ensure a good and stable future.

An Important Rating of Your Life

Getting an A++ rating could make your day. But if you are a self supporting adult or supporting a family a good credit rating would definitely make your life. You need a good credit rating to be eligible or approved for any post paid account, a home mortgage, a credit card, or even insurance.

You will not like it if you one day receive a notice from a bank advising that your mortgage or credit card application was declined. Mortgages, loans, post paid services and credit card applications are usually declined based on a bad credit rating. Even employers may take credit rating as a consideration for hiring the right job applicant.

Your credit rating tells about your credit worthiness. It is based on your previous financial history and your current assets and liabilities. Even large corporations and countries also have a credit rating since they also borrow money from banks.

Disputing your Credit Rating

Disputing your credit rating is one of the many necessary steps to cleaning up your credit report. A credit rating is often based on credit reports that are not always accurate. You may also justify your situation if there is something in the credit rating report that is true but something needs to be considered. A dispute will be visible to anyone who will read your credit report

A credit rating dispute also known as a credit rating correction may change to course of your life. This must be taken seriously since it involves your future and your life. A professional that offers credit management services must be considered. Credit rating correction involves knowledge about finance and an idea where a good credit rating is based on.

Tags: credit rating, credit rating corrections, credit score, disputing credit score
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TransUnion: Late Fees to Decrease in 2010

December 9th, 2009

Some people may find a late fee reasonable, but for some who are two to three months behind on their monthly payments this is a serious thing. Imagine paying $30 on top of your minimum monthly payment for the next two or three years when you can’t even afford the minimum payment anyways. Some cards even charge interest on their late fees, making payment in full little more than a fanciful dream.

A late fee would normally cost $15 to $30 or even more. The terms and conditions of your credit card plan or a loan state you will be fined if you fail pay on time. I don’t know about you, but I would rather spend that late fee watching James Cameron’s “Avatar” with a big tasty bucket of pop corn.

Minimum Payments are Not Ideal

It is more convenient and easier to pay the minimum monthly payment since it requires less cash. But it is only ideal to pay this if you are on a tight budget. It is best to pay more than the minimum payment if you have the extra cash. Not only will it enable you to pay less next month but it may also shorten your payment terms – so long as you don’t charge more, of course.

Delinquent and late payments have contributed so much to the recent recession. Banks have less revolving funds due to poor collections from monthly payments. This will make it harder for the banks and customers to recover from their losses. A good credit management plan will definitely help both the issuer and the customers.

More Cash to Spend in 2010

TransUnion is the third largest US based consumer credit reporting agency. According to them it is very difficult for consumers to catch up with their payments if their payments are three months late. TransUnion based its credit management report on data available through their own credit reporting database.

Late and delinquent payment for credit cards and mortgage loan are due to decrease by the end of 2010. This will be very much appreciated by banks after losing billions from bad loans. According to Ezra Becker TransUnion’ director of consulting, this is a first for the last three years. The progress may be slow and consumers may encounter some more bumps on along the road but the turning point is in sight.

This means consumers will have more cash to spend on something more useful than a late fee. This could also be a sign that the US economy is slowly but surely regaining its strength.

Tags: credit, credit cards, credit management, debt, transunion
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New Features Make Credit Cards More User-Friendly

December 8th, 2009

Who could have thought cell phones could one day be a point of sales system? The 21st century is indeed making things we only once dreamed a reality.

As newer and newer concepts and inventions come out, we may someday live in a cashless world where everything is processed electronically just by passing our hand over a reader. That may be a nightmare for some, but nevertheless a very potential reality of the future.

Mobile Cashier Terminals

The credit card services by year 2010 are set to bring automated payments to a new level. Twitter co-founder Jack Dorsey and his friend John Mckelvey designed a new ingenious device that can take payments using your ordinary iPhone. Interestingly,  they came out with this idea after figuring out they can sell more of his their glass work if they accept credit card payments.

This new concept is called “Square”. It uses a small accessory that connects to the iPhone audio jack. An application also called Square has to be installed on the iPhone to process the payments. Then the buyer simply signs the credit card receipt using a stylus or his finger.

The application of this system will allow hotdog vendors and even girl scouts selling their cookies to accept credit card payments. Even sellers in a flea market or garage sales would be able to accept credit card payments.

The New Credit Card Act

While Square allows your iPhone to take credit card payments, the Bank of America (BofA) is improving its credit card services through a simplified credit card statement which is meant to be easier to understand. The new statements are in preparation for the new credit card act requiring card issuers to clearly specify the interest rate, fees, and effective dates of changes.

It is so easy to pay for your shopping via a credit card but every card holder will surely appreciate if their monthly statements clearly define and summarize their charges. BofA launched this initiative last December 1, although it does not make BofA fully compliant to the new act just yet.

The new credit card act requires issuers to clearly present the cumulative interest rates and the trending if they only pay the minimum monthly payment. The new monthly credit card statements are meant to make your important personal financial data easier to understand and provide the number of payments you still have to make to clear your credit card debt. The credit card act is set to be implemented by February 22, 2010.

Tags: bank of america, credit card act, credit card statements, credit cards, iPhone credit card, square credit application
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How to Pay For a Laptop for The Rest of Your Life

December 7th, 2009

Credit cards have revolutionized our spending habits. In the old times we could only purchase things if we had money to pay for it outright or if you were willing to render your services in exchange for a product. Globalization and materialism led us to a new era of debt and credit.

Having a credit card or two can come in handy during a shopping emergencies or even life threatening ones. Anyone can survive a week or two or even a month without cash, as long as you have a credit card with a big enough credit limit.

Plastic Loan Sharks

Today a credit card’s monthly minimum payment is at 4% of your total balance. Let’s say that you decided to purchase a brand new Mac Book Pro priced at $1,199. You decided to pay for this in credit, after receiving a hard to resist offer that will allow you to pay $20 per month for it. This deal sounds good but for whom?

You may not be aware that a big chunk of our monthly payment will go to pay for the interest; only a small part of it will pay for the amount you borrowed. If you only pay the minimum monthly charge this $1,199 purchase may take up to 30 years to finish. And the interest can cost you up to $5000 for an item a little over $1000!

Human Instincts

Humans naturally desire for more wealth and a better life. Some of us cannot resist the temptation of buying items and goods that are in trend or new. We even set aside the fact that we can’t afford it and rely on using the good old plastic credit card to pay for our doodads (as Robert Kiyosaki refers to it).

We all have our wants and needs depending on our lifestyle. There is nothing wrong with buying something that you want so much as long as you don’t intend to kill someone with it – and that includes yourself.

Promotions are usually full of overstatements if not understatements. Watch out if it sounds too good to be true. They usually present only the good part of the offer. We have to face the reality that company’s main objective is to profit. That’s why they are called “company” – not “charity”.

However, if you happen to find yourself in a sticky situation, there is someone who wants to help you. Credit and debt counseling can help you gain control of the situation. Even better, you can get credit and debt counseling at no charge, as many are now not-for-profit organizations.

Tags: credit, credit cards, credit counseling, debt, debt counseling
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Oil Pipelines the New African Hope

December 6th, 2009

African nations are among the poorest nations in the world – the continent itself is the poorest among the seven, but the tides of wealth and power may soon change. Raw material commodities production in Africa is increasing, with demand climbing up right next to it.

The African oil output is expected to skyrocket in the next several years with Nigeria well in the lead for top producer. Ghana will start to pump its oil from a new offshore field by the later part of 2010. Uganda alone is expected to produce 150,000 barrels of oil a day – that is 6.3 million gallons of oil at 24 gallons a barrel.

Production Does Not Equate Riches

Amidst this foreseen increase in oil production are sentiments from the African public that it is not actually improving the lives of the people. Some Africans say oil in Africa prevents other commodities and sectors, like business and tourism, from developing because the government is too focused on oil commodities investment and production.

More and more Africans are losing their jobs, further preventing the creation of new jobs while other Africans say oil in Africa is a blessing. Most of the Africans who support the oil production believe it is their leaders who are not doing anything effective to stop the corruption and improve the economic status of Africa – since even some of the leaders are corrupt.

Problems Needing to be Addressed

Armed rebellion in Nigeria and pirates are also major factors which cannot be ignored. Before the oil pipelines can bring riches and secure the future of the African people this issue has to be addressed.

For instance the Nigerian rebels once blew up a pipeline which cost 700,000 barrels of crude oil a day. Ever day oil tankers in Somalia face the danger of getting boarded by pirates who will either steal their oil cargo or demand ransom for the ship and its crew. These are only some of the barriers the African oil producing countries are facing.

Oil thirsty US and China will be increasing their oil demands from Africa. Oil is definitely the new hope of Africa, without a doubt – but hope is useless without the determination and will of the people and leaders to help ensure that future. For now, Africa remains extremely unstable – but it is also showing one of the most rapid growth spurts of any continent.

Tags: Africa, commodities, oil
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