2. We need to be realistic about the
financial system’s problems’ effects on the real economy : deleveraging; credit contraction; and investor risk aversion.
3. As investors, it is important for us to assess, reflect, consider carefully, and take action if appropriate for their situation; three defensive equity sectors which Morgan Stanley’s Global Equity Strategists rates as attractive are Healthcare, Consumer Staples, and Telecom.
4. There is usually no premium yield without a premium risk.
5.
Good quality companies and good quality assets are to be held and should make investors money over time.
6. During bear markets, it usually pays to be patient before substantially increasing your risk exposure; there is never a big hurry to act within a cyclical downtrend period.
7.
Investors should consider the appropriate application of risk management strategies; including, but not limited to: (i) higher-than-normal levels of Cash; (ii)Defensive-style asset classes and specific investments within an asset class; and (iii)inverse Exchange Traded Funds.
8. At all times, investors need to be open-minded, flexible, and vigilant.
9. Especially in times like these, investors need to keep their long-term investment objectives in mind.
10. We need to keep life in perspective and our five lives in balance: our Work Life;our Love Life; our Creative/Spiritual/Religious Life; our Athletic/Physical Fitness Life; and our Altruistic Life.
Source: Morgan Stanley
]]>By Donna Miles
American Forces Press Service
WASHINGTON, Aug. 15, 2008 - The economic downturn that has hit many Americans appears to have had less impact on U.S. servicemembers, partly because of the nature of military service and partly due to the vast network of programs and services available to help them, defense officials said.
The latest annual Defense Department status of forces survey conducted in April by the Defense Manpower Data Center supports that assessment, said Navy Cmdr. Dave Julian from the Pentagon’s new Office of Personal Finance and Transition.
When junior enlisted members in grades E-1 through E-4 were asked to describe their personal financial situation in the anonymous survey, 3 percent said they are “in over my head” or “having difficulty making ends meet,” he reported, citing the yet-to-be-published results.
“Those levels have been declining over the years,” he said, from a high of 5 percent in 2002.
Another survey question asked servicemembers if they or their spouse had missed a rent or mortgage payment during the past 12 months. Again, the number responding yes was 3 percent, down from 4 percent in 2007..
“I was very surprised,” said Army Col. Shawn Shumake, a legal advisor in the Pentagon’s personnel and readiness office. “If they’d been like anyone else [in the general public], you would have expected it to go up 50 percent.”
He cited record-high foreclosure rates nationwide, with reports that the number of households receiving foreclosure notices is up 50 percent or more over past year.
Julian said there’s no question that soldiers, sailors, airmen and Marines feel the pinch of spiraling gas, grocery and other prices. “The things that affect the general public are the things that affect our military, as well,” he said. “But they do have some stopgaps in place to help them, more so than the average citizen.”
Because servicemembers have secure full-time jobs, commissary and post exchange privileges, free medical care and cash for housing if the military doesn’t provide it, they’re less likely to be as financially stressed as some of their civilian counterparts, he said. In addition, troops on deployments benefit financially from tax-free earnings in combat zones, hazardous duty pay, and if they’re married, family separation pay.
Another big factor is the fact that three-quarters of troops who live off base rent their homes, so they’re not as hard-hit by the depressed housing market, Julian said.
They have been affected, however, when they’ve had to scurry to find local housing when their landlord’s lender repossessed the property they were renting, officials said. Until recently, servicemembers stuck in these situations had to pay for the move themselves.
No more. A new change to the Joint Federal Travel Regulation authorizes the military to pay for local moves when a landlord defaults. Bill Carr, deputy undersecretary of defense for military personnel policy and chairman of the Per Diem, Travel and Transportation Allowance Committee, approved the change Aug. 8, Eileen Lainez, a Defense Department spokeswoman, said. The change is retroactive to July 30.
One segment of the military population likely to be hardest hit by the housing downturn is the 25 percent of servicemembers who own their homes, Shumake said. “If people bought high in 2005 and have to move now, they may be caught with negative equity in their house because the value has started to fall,” he said.
If individuals are unable to sell their houses for what they owe and can’t get enough in rent to cover the mortgage, they’re likely to feel the pinch, he conceded. That’s especially true if they’re reassigned from a high-cost housing area to a lower-cost one where their housing allowance is reduced, sometimes by more than half.
A provision in the Joint Federal Travel Regulation offers a protection Shumake said many servicemembers don’t know about: They can elect to leave their family at their old duty stations as they move to a lower-cost area and continue to draw their housing allowance at the higher rate where their family lives.
It’s not an ideal circumstance, Shumake conceded, but could be a lifesaver to some families facing a financial crisis.
Julian and Shumake pointed to the broad array of services available to help servicemembers and their families avoid financial crisis and get help when they encounter one. Personal financial counselors and legal assistance staffs provide free services and can steer troops in financial difficulty to the help they need, they said.
“We have resources available, and encourage members to take advantage of the financial services and counseling available through their installation,” Julian said.
Julian’s office is putting together a financial road show – technically “financial readiness challenge events” — to take that message directly to the troops. The program, expected to kick off by October, will bring financial experts to military bases, where they will present a full day of seminars and one-on-one sessions to help servicemembers better manage their personal finances. Each session will be tailored to specific installation’s needs, based on input from commanders and senior enlisted leaders, Julian said.
Meanwhile, troops not comfortable with the idea of a personal meeting can take advantage of financial counseling over the telephone through Military One Source, he said. The program, in place about six months, enables callers to talk about their personal financial situation with a trained counselor who can offer advice and help. That service is provided by calling toll-free 800-342-9647.
Ultimately, servicemembers’ financial readiness boils down to a military readiness issue, Julian said. Worrying about whether they are going to be able to pay their bills or are about to lose their homes
distracts troops from concentrating on the mission and can put them and their buddies at risk, he said.
“We want to keep our men and women overseas, especially the ones in harm’s way, concentrating on the mission at hand and the important tasks they have to accomplish, rather than their financial situation at
home,” he said.
“They’re not going to be keeping their eye on the target if they’re worried about stuff back home,” Shumake agreed.
Helping servicemembers get a handle on their finances reduces stress on the entire family, and that, in turn also helps readiness, Julian said.
“We look at the family and the servicemember as a team,” he said. “So this is really a matter of allowing the servicemember to focus on his job, and allowing the spouse and the family to focus on their job so
together, we can accomplish the mission.”
]]>2) Clear the clutter: Mail stacked on the table, shoes lined up against the wall - too much clutter can minimize the space, detract from your decor and put you in a bad mood by reminding you of chores you have to do.
3) Personalize it: Your entryway is part of your guests’ first impressions of you and your home. Give them a sense of who you are by including personal items like family photos and favorite artwork.
]]>In the wake of the current mortgage crisis, credit scoring is on the defensive, perhaps unjustly. Why, some are asking, didn’t credit scores predict that so many homeowners would fail to pay their mortgages and wind up in foreclosure? Credit scores are arrived at by inputting about your credit history and behavior into a mathematical model. Those based on the model originated by Fair Isaac and Company are called “FICO” scores and are the ones used by most mortgage lenders. However, credit scores don’t address factors such as loan-to-value or debt-to-income ratios. Those are up to the lender, who must apply sensible underwriting standards. In many instances in the past, they didn’t. And credit scores did identify higher risk individuals, but lenders created programs they thought would compensate for the risk involved. In too many cases, they were wrong.
So to blame credit scores for past mortgage problems doesn’t seem entirely fair. That controversy, notwithstanding, good credit scores are even more vital ever to homebuyers than ever. With the annihilation of the subprime lending market, many buyers with poor credit marks have few places to turn. And those with scores that used to be considered highly acceptable, now must pony up more money up front for their loan. So having the best score possible is a top priority for potential homeborrowers. Fair Isaac describes a FICO score as “an estimate of your credit risk based on a snapshot of your credit report at a particular point in time.” FICO scores range from 300 to 850 (a high score is good). Scores above 720 typically qualify for the best rates. Subprime roughly begins below 650, so every point is crucial.
Fair Isaac has a new version of its scoring system, FICO 08, poised to be rolled out soon. It will refine its approach in a number of areas, but will leave the 300-850 score range intact.
To see how different crent credit scores affect your mortgage rate, there is a chart, updated daily with current mortgage rates, at myFICO.com. There are three major credit reporting agencies, each of which maintains your credit history—Experian, Equifax, and TransUnion—and a separate credit score is generated based on the information at each one. Because each credit agency may haveslightly or even significantly different information, your score can vary from agency to agency. In addition, each of the agencies has also tweaked the FICO program, which can yield different scores even when the information is the same at each agency.Mortgage lenders generally request scores from all three agencies and look at the middle one. According to Fair Isaac, your credit payment history is responsible for 35% of your FICO score; amounts you owe, 30%; length of your credit history, 15%; applications for new credit, 10%; and types of credit used, 10%. You are entitled to a free credit report from each of the agencies (go to annualcreditreport.com), but that doesn’t entitle you to a free credit score from them; for that you will have to pay. Caution: other sites may offer you a free credit report or score, but it may not be a FICO score and it may subject you to their advertising pitches. you get a free annual credit report from one of the agencies, they will be happy to sell you your score at the same time, but the Experian and Trans-Union scores will not be FICO scores and will have a different scoring range. You will need to go to myFICO.com to purchase FICO scores for them.
Here are a few tips for boosting and maintaining your credit score, courtesy of Fair Isaac:
• Closing unused credit accounts won’t increase your score, in fact it may decrease it by having fewer open accounts. But don’t open new accounts just to increase your available credit; that could also lower your score.
• If you are just starting to establish credit, don’t open a lot of new accounts all at once.
• Credit inquiries can lower your score.However, FICO scores distinguish between searching for a single loan among several lenders and applying for multiple credit lines. Try to fit your comparison shopping within a twoweek period. Want more information? You can get booklets that provide an overview of credit scoring, including more factors that influence credit scores and tips on improving them at myFICO.com.
]]>The Lupus Foundation of America: Go to www.lupuspickup.org and schedule a pick-up. They take clothes, household items, dishes, knick-knacks and more!
Purple Heart: Go to www.purpleheartcars.org to donate your car online. Support the troops and vets with this great tax incentive.
Habitat for Humanity: Go to www.habitat.org/env/restores.aspx to find a location close to you! This is a great resource if you need to get or give building supplies. The funds raised through this organization go directly back to the community and enable Habitat to build an additional 10 homes a year!
Running Shoes: Go to www.runtheplanet.com/shoes/selection/recycle.asp to find out information on how and where to donate your old shoes. There is a heaven for old shoes! You can even pick which area of the world you’d like to help!
Endless ways to get rid of your old stuff - happy organizing!
]]>Skipping a proper inspection: The inspection may cost a few hundred dollars up front, but it can save you thousands if the home has issues like termites or structural problems.
Being impatient: A home shouldn’t be an ‘impulse’ purchase - take your time and find the home that works best for you.
Not doing your financial homework: Before you go home shopping, check your credit report, talk to a lender, find your price range, and get pre-approved for a loan.
Ignoring Export help: Hire a professional who knows the market, help you through the entire process, handle the paperwork and make sure you get the best deal.
]]>A process has been established for the return of fees and taxes collected by the Northern Virginia Transportation Authority. The following is a brief summary of the process. Please click here to view the complete guidelines.
NVAR suggests, as a courtesy, that agents forward a copy of the HUD-1 statement from affected transactions to sellers. The Clerk’s office recommends waiting two weeks before contacting settlement agents to check on the status of any expected refunds. |
1. Failing to Showcase Your Home and Make Small Cosmetic Changes: When you are selling your house, you have to really look at it objectively and think about it from the viewpoint of the house hunter. Make minor enhancements to the house and maybe hire a professional stager to come and arrange your furniture. Staging is about decorating your house for the buyers’ taste, not yours. A great place to start is with the front of the home and the main entryway. Home staging is designed to increase the potential selling price and reduce the amount of time the house stays on the market.