How to be Rich, Happy and Free from Scams

NEW YORK - THE for-sale listings on the online hub Craigslist come with plaintive notices, like the one from the teenager in Georgia who said her mother lost her job and pleaded, 'Please buy anything you can to help out.' Or the seller in Milwaukee who wrote in one post of needing to pay bills - and put a diamond engagement ring up for bids to do it. Struggling with mounting debt and rising prices, faced with the toughest economic times since the early 1990s, Americans are selling prized possessions online and at flea markets at alarming rates. To meet higher gas, food and prescription drug bills, they are selling off grandmother's dishes and their own belongings. Some of the household purging has been extremely painful - families forced to part with heirlooms. 'This is not about downsizing. It's about needing gas money,' said Ms Nancy Baughman, founder of eBizAuctions, an online auction service she runs out of her garage in Raleigh, North Carolina. One former a...

Courtesy of CNA forummer: ian_ow DOW and SG indexes at major turning points. My view: S&P and DOW will not have a sustain break above 1400 and 13,000 respectively. STI has no strength pushing past the 3200 and could possibly sell down from here if a strong resistance forms. For the optimists - The recent global economic problems have only started and the calls for a sustained rally or a bull run is ridiculous. Some important headlines : April 28 (Bloomberg) -- Former World Bank President James Wolfensohn said he's `` pessimistic'' on the outlook for financial markets and predicted losses from the global credit turmoil may climb to $1 trillion . NEW YORK (Reuters) - Warren Buffett , the world's richest person, said on Monday the U.S. economy is in a recession that will be more severe than most people expect. "This is not a field of specialty for me, but my general feeling is that the recession will be longer and deeper than most people think ," Buffett s...

NEW YORK (Reuters) - Warren Buffett, the world's richest person, said on Monday the U.S. economy is in a recession that will be more severe than most people expect. Buffett made his comments on CNBC television after his Berkshire Hathaway Inc (NYSE:BRK-A - News ; NYSE:BRK-B - News) agreed to invest $6.5 billion in the takeover of chewing gum maker Wm Wrigley Jr Co (NYSE:WWY - News) by Mars Inc in a $23 billion transaction. "This is not a field of specialty for me, but my general feeling is that the recession will be longer and deeper than most people think," Buffett said. "This will not be short and shallow. "I think consumers are feeling gas and food prices," he added, "and not feeling they've got a lot of money for other things." He was not immediately available for further comment. Known for his frugality, the 77-year-old Buffett has lived in the same 10-room Omaha, Nebraska, house for a half-century, despite being worth a...

The people, who are calling depression and a prolonged bear market, do not belong in the same class of investors as the great Warren Buffett. Looking at the latest annual report of Berkshire Hathaway, page 16, I find the following: “The second category of contracts involves various put options we have sold on four stock indices (S&P 500 plus three foreign indices). These puts had original terms of either 15 or 20 years and were struck at the market. We have received premiums of $4.5b, and we recorded a liability at year end of $4.6b. The puts in these contracts are exercisable Buy ! only at their expiration dates, which occur between 2019 and 2027, and Berkshire will then need to make a payment only if the index in question is quoted at a level below that existing on the day that the put was written. Again, I believe these contracts, in aggregate, will be profitable.” Do you think Buffett would be wrong? Do you think there would be a decoupling between US and other markets? If you ...

NEW YORK - FOR people aged 50 and 64 years, being wealthy seems to protect them against having a stroke, according to new research. After age 65, however, wealth appears to make little difference in stroke risk. 'We confirmed that lower wealth, education and income are associated with increased stroke up to age 65, and wealth is the strongest predictor of stroke among the factors we looked at,' Dr Mauricio Avendano, who was involved in the research, noted in a written statement. 'After age 65, the association of education, income and wealth with stroke are very weak, and wealth did not clearly predict stroke,' said Dr Avendano, of Erasmus Medical Center, Rotterdam, The Netherlands. Each year about 780,000 Americans suffer strokes; about 27 per cent of strokes occur before age 65, according to the American Heart Association. Dr Avendano and co-investigator M. Maria Glymour assessed the effect of income (i.e., annual earnings), wealth (total of all assets minus liabil...

Vincent Mao Nitrous oxide ramps up an engine's power by allowing more fuel to be burned. In the stock market, margin works kind of like that. With margin, you can magnify your returns and buy more stock than you otherwise could. There are advantages and disadvantages to this. And there are times when you should be on margin as well as times when you shouldn't. Margin lets you buy stock without putting up all of the required capital. Under current regulations, you put up half of the position's value and borrow the other half from your broker. This 2-to-1 leverage factor is the main reason why investors use margin. If a trade works in your favor, you'll earn a higher return -- more bang for your buck. Of course, brokerage firms don't lend you money for free. They charge you interest on a monthly basis depending on the debit balance, or how much you borrowed. Suppose you buy 100 shares of a $100 stock in a regular cash account. You'll need to have at least $10,000...

The credit crunch may be behind us and earnings have been better than expected. That could lead to happier times if the Fed starts focusing on inflation. By Paul R. La Monica, CNNMoney.com editor at large NEW YORK (CNNMoney.com) -- What a wild week. Oil hit another record high but has since pulled back. The dollar has finally started to show some signs of life. And for the most part, corporate earnings were - as Larry David would say - pretty pretty good. Boeing (BA, Fortune 500) blew away earnings estimates. Ford (F, Fortune 500) posted a surprise profit. And even though investors Friday appear to be disappointed by the forecast from Microsoft (MSFT, Fortune 500) for the current quarter, the company issued a healthy outlook for its next fiscal year. The worst of the credit crunch may finally be behind us. There have been no more major bombshells from financial institutions, a sign that the Fed's six rate cuts since last September and massive injections of liquidity into the bankin...

The U.S. economy is already in recession -- and may echo the 1930s, Nobel Laureate Joseph Stiglitz said Friday. "The big question is: how will the government respond?" said Stiglitz, in an interview with CNBC. Stiglitz, a Columbia University professor and 2001 winner of the Nobel prize, detailed his bleak outlook for the American economy. "This is going to be one of the worst economic downturns since the Great Depression," said Stiglitz. He explained that main cause of the current situation is historically unique -- and thus is befuddling those charged with creating solutions. Other downturns were primarily caused by excesses in inventories or inflation; but this slowdown is due to the condition of "badly impaired" banks and financial entities, which are unwilling and/or unable to lend capital -- stymieing the very borrowers who usually drive the country back to vitality, Stiglitz said. And the Federal Reserve may have used up its ammunition -- and the fai...

by David Bach In early April, the Bureau of Labor Statistics reported that 80,000 jobs were lost in March -- and almost a quarter of a million since the beginning of the year. Many analysts are predicting that net job losses are likely to continue at least through August. This news may be causing you to feel fearful for your own job, particularly if you work for a large corporation. That's understandable. But now isn't the time to panic. Instead, take action to avoid becoming a statistic. The Good, the Bad, and the Great So when the workforce reduction ax swings in your company, who will it hit? Bad employees? Sure, if any are still around. Good employees? Yes, those too. Good employees are the single biggest problem a boss faces. When you talk to truly successful business owners or managers, they'll tell you it's not the bad employees who concern them -- they'll ultimately quit or get fired. It's the ones who do what it takes to be OK, but never enough to be gr...

by Eileen P. Gunn t could be that managers and workers have a different take on what it means to be a top performer, and so they disagree on who should get the corporate spoils. Most workers think that if they know what their job is and do it well, hitting all their goals on time and within budget, then they're doing a good job and deserve to have raises and bonuses heaped upon them. That would be true in a pure meritocracy. But in the real world, the politics of compensation are not that simple. Here are five keys to increasing your salary and benefits: 1. The boss's priorities rule From the boss's perch, the biggest raises and plumpest perks go to the people he values the most and doesn't want to lose. These are the people who help him to get things done, meet his goals, and generally look good. In short, your performance and the raise it garners are less about you and all about him. This is why leadership expert Rebecca Shambaugh, author of It's Not the Gla...

April 22 (Bloomberg) -- Falling shipments at United Parcel Service Inc. and FedEx Corp., which together deliver 80 percent of packages in the U.S., show the economy is in a recession and unlikely to rebound this year. UPS, whose domestic volume has outperformed the gross domestic product for almost a century until last year, said April 8 that deliveries dropped in the first quarter. UPS also said earnings for the three months through March will miss its previous projection by as much as 7.4 percent, just the third time the Atlanta-based company has made a new forecast that was below an earlier one. FedEx's U.S. shipments dropped 2 percent last quarter, and the company said last month it would have ``limited earnings growth'' this year because of the slowing economy. Both companies are also struggling with soaring jet-fuel, gasoline and diesel costs after crude oil surged 80 percent in the past year. ``This is what a recession feels like,'' said Steven Marco, who man...

NEW HAVEN (Connecticut) - AN INFLUENTIAL economist who long predicted the housing market bubble cautioned on Tuesday that the slump in the US housing market could cause prices to fall more than they did in the Great Depression and bailouts will be needed so millions don't lose their homes. Yale University economist Robert Shiller, pioneer of the widely watched Standard & Poor's/Case-Shiller home price index, said there's a good chance housing prices will fall further than the 30 per cent drop in the historic depression of the 1930s. Home prices nationwide already have dropped 15 per cent since their peak in 2006, he said. 'I think there is a scenario that they could be down substantially more,' Mr Shiller said during a speech at the New Haven Lawn Club. Mr Shiller's Standard & Poor's/Case-Shiller home price index is considered a strong measure of home prices because it examines price changes of the same property over time, instead of calculating a me...

SINGAPORE - A SINGAPORE state investment fund that bought multi-billion dollar stakes in beleaguered banks Citigroup and UBS said a global financial crisis and recession was increasingly likely but that its investments in western banks were long-term in nature. 'The financial contagion has now spread beyond US shores, increasing the likelihood of a global financial crisis and recession,' Government of Singapore Investment Corp deputy chairman Tony Tan told a staff meeting on Monday. 'We could be facing a recession which is longer, deeper and wider than any recession we have encountered in the last 30 years.' 'We regard our investments in UBS and Citigroup as long term investments which will give us good returns when markets stabilise and economic conditions return to more normal levels,' he said. GIC is the larger of Singapore's two sovereign wealth funds and bought 11 billion Swiss francs (S$15 billion) worth of mandatory convertible notes in UBS last Decem...

Even some great investing minds are confused. But don't run scared. We found a few intriguing opportunities including steel, Microsoft - and cattle futures. By Jon Birger, senior writer (Fortune Magazine) -- How treacherous are the financial markets these days? So treacherous that you can get blind-sided even if you're one the world's great investors, even if years ago you anticipated the credit crisis now roiling Wall Street - even if you're George Soros. After posting big gains in 2007, Soros's $17 billion Quantum Endowment hedge fund has been flat in 2008. The profits Soros earned shorting the dollar have been wiped out by big positions in free-falling Chinese and Indian stocks. Yet Soros seems unperturbed. "We are in a period of acute financial wealth destruction," the 77-year-old superstar speculator tells Fortune. "If you can preserve your capital in a period of wealth destruction, you're doing pretty well." Soros isn't the only inv...

by Thomas Kostigen Making money, not inheriting it, creates more financial security Most wealthy people earn their money, and because they earned it they feel more secure about keeping it. That's what a new survey reveals about wealth and values. PNC Wealth Management conducted the survey of people with more than $500,000 of investable assets. The Wealth and Values Survey showed that 69% of "wealthy" Americans accumulated most of their money through work, business ownership or investments; 6% percent received money through inheritance; and 25% gained wealth through a combination of inheritance and earnings. "An overwhelming number of affluent Americans earned their wealth and are more likely to feel secure during challenging economic times compared to peers who inherited their money," according to PNC. These findings mirror most other studies of the wealthy and how they got rich. Indeed, take a look at the Forbes list of the world's richest people and ...

The head of a US business executives group warned Thursday that the world's largest economy could endure a "double dip" recession if efforts by the authorities fail to spur growth. "If, after the economic stimulus package takes effect and we get into (20)09, and the ... lower interest rates do not kick in, there is a probability of (a) double-dip recession," said Harold McGraw, chairman of Business Roundtable, which represents chief executive officers of leading US companies. "That could have serious effects on the other developed countries," said McGraw, who is also head of publishing giant McGraw-Hill. US economic growth has slowed dramatically in recent months and a growing number of economists fear the world's largest economy will experience a recession during the first half of 2008 amid a housing slump and related credit crunch. There is also growing nervousness that the economy might slip back into recession again after a brief recovery in a ...

By TradingMarkets Research Peter Forth is president of 4th Systems Inc. and creator of the StockReflex stock market replay simulator (stockreflex.net). Part video game, part learning tool, StockReflex helps you refine your technical analysis skills and amass trading experience without financial risk. According to Cal Berkley University research, more than eight out of ten people who trade the stock market on a regular basis lose money. However, the people who do make money at trading tend to do so consistently and repetitively. What do these successful traders have that the others don't? A key factor is their ability to make their decisions to buy and sell without being influenced by extremes of fear and greed. Indeed, inappropriate emotional influence on trading decisions is one of the key reasons that most traders fail to make a profit. Fear There's a martial-arts maxim that you should never get into the ring until you have mastered the basic forms. If you do, your fear of g...

NEW YORK - LEHMAN Brothers Holdings Chief Executive Richard Fuld joined a growing chorus of investment bank executives in saying on Tuesday that the worst of the credit crisis is behind Wall Street. Mr Fuld, speaking at the investment bank's annual shareholder meeting, said that credit markets have begun to ease but still believes the environment 'will remain challenging.' Steep losses tied to mortgage-backed securities has cost the world's biggest banks and brokerage about US$200 billion (S$271 billion) since last year. Similar comments came last week from two other investment bank CEOs - Goldman Sachs Group's Lloyd Blankfein and Morgan Stanley's John Mack. Both said during shareholder meetings that Wall Street is closer to the end of the crisis, and that it might last a few more quarters. Lehman Brothers, the nation's fourth-largest investment bank, raised about US$4 billion from a stock sale earlier this month to help boost capital levels. The securi...

BERLIN - A 13-year-old German schoolboy corrected Nasa's estimates on the chances of an asteroid colliding with Earth, a German newspaper reported on Tuesday, after spotting the boffins had miscalculated. Nico Marquardt used telescopic findings from the Institute of Astrophysics in Potsdam (AIP) to calculate that there was a 1 in 450 chance that the Apophis asteroid will collide with Earth, the Potsdamer Neuerster Nachrichten reported. Nasa had previously estimated the chances at only 1 in 45,000 but told its sister organisation, the European Space Agency (ESA), that the young whizzkid had got it right. The schoolboy took into consideration the risk of Apophis running into one or more of the 40,000 satellites orbiting Earth during its path close to the planet on April 13 2029. Those satellites travel at 3.07km a second, at up to 35,880km above earth - and the Apophis asteroid will pass by earth at a distance of 32,500km. If the asteroid strikes a satellite in 2029, that will c...

Simon Mortlock Staff at UBS in Singapore are sprucing up their CVs as job-cut rumours start to spread. One recruiter, who asked not to be named, says a few UBS bankers have already been in touch to discuss their careers. “I’ve definitely seen more résumés coming across my desk this month. There are certainly interesting things going on at UBS. People there seem to be spooked,” he adds. The job-loss jitters follow UBS’s announcement earlier this month of US$19bn of new asset writedowns, and the departure of chairman Marcel Ospel. But at this stage employees are only talking to recruiters, not walking out to join rival banks. “I haven’t seen any actual hirings of UBS people yet. It’s all rumour and speculation at the moment. They want to keep their options open,” says the recruiter. Another Singapore-based search consultant, who also preferred to remain anonymous, agrees UBS workers are nervous: “From people I know there, there’s a lot of talk about what’s going on, but that...

By Richard Barley LONDON (Reuters) - The financial crisis will affect market structure and pricing for at least a decade and lead to greater regulatory powers for central banks in areas at the centre of the turmoil, analysts at JP Morgan said. "Market participants and regulators will focus intensely on controlling the risks that were at the core of the crisis," analysts led by Jan Loeys and Margaret Cannella wrote in a note on Monday. These risks include lending standards in mortgages, leverage in the funding of securitized products, and the use of short-term financing for illiquid long-term assets outside of the regulated banking sector. This will change behavior for market participants "for at least a decade," they wrote, in line with fallout from previous crises. "We had the NASDAQ, we had LTCM, we had the various forms of emerging-market crises in the '90s, we had the real estate crisis of 20 years ago: In most of these the direct impac...

by Laura Rowley In the 1880s, British economist Francis Edgeworth proposed creating an instrument called a " hedonimeter " that could measure, physiologically, how much pleasure a person derived from a specific choice. Edgeworth suggested that the hedonimeter would expand utility analysis from theoretical economics to the real world, helping individuals maximize their welfare and societies create better public policy. The Hedonimeter Reborn A group of researchers is reviving the notion of the hedonimeter, at least philosophically. They've developed a method to measure, compare, and analyze how people spend and experience their time, across countries and over time. The idea is similar to Edgeworth's -- if we have a quantitative way to measure which activities bring pleasure to most people most of the time, we can make better decisions to enhance our well-being . "We're really interested in describing people's lives as they experience them, as opposed to th...