You're the greatest detective ever! Can't wait to hear how many out in Vegas strike it rich! :)

Love it!  LJM PI...

As for Vegas, look for me at the Roullette wheel.  Never more than 30 minutes.  Usually double my drop.  It's uncanny.  And then I stop and gamble no more.  I hope I won't be contributing any first hand stories to your debt series, LJM...

Thanks westcott and lJM for this cool entry! 

down here? Have a great time in Vegas and don't lose your shirt. You could probably do woman on the street first hand accounts for the debt series there in the casino. We are living in interesting times. I heard on NPR that Halliburton "isn't hurting." They got a big contract in Saudi Arabia with ARAMCO to dig oil wells all over the place. Guess they want to suck up all the oil, before the radicals throw out the royal family there.

Not Roullette! (unless you just like giving the casino wads of cash). A smart gal like you would have no problem cleaning up at the poker tables (+ you get to use some acting abilities too in a subtle way). Plus, most guys at the poker table think women are idiots when it comes to poker, so that is even more dead money for you.

Was at the Bellagio a couple of months ago and place was absolutely wonderful.

hang on to those dates for the series. We have to start at the beginning, with Spain and Columbus:) This could be a very long mini-series.

discovered ...... Spanish conquistadors decimate the native populations steal all their gold and silver take it back to Spain and the influx of god/silve was so much that it caused wars and changes to the monetary systems... power struggles over colonial holdings...

yep that is good.... Queen Isabell gives ( I forget the name of the decree it has an interesting date and name ) that is is ok to kill the natives to expand the Spanish Empire.... monarchy gives absolution for genocide

"The secretary of state is suppose to administer elections - not throw them."  Rep. Dennis Kucinich - OH

came from the pope. Spreading Christianity was a big part of it. People also got worked to death and from disease. They were killing people in Spain in the name of Christianity at the same time. Oh, and Spain pretty much spent all the money. Too bad they hadn't read Poor Richard's Almanac, but that came later.

"The secretary of state is suppose to administer elections - not throw them."  Rep. Dennis Kucinich - OH

Fun and informative!

Keep the bear blue!

Write for those with little time and short attention spans. Make it a story. I'll see what I can do. Oh, and Maddy, she got all that money from clean living:) You'd be surprised how many teachers have wound up as millionaires in the end. Of course, it could have been an inheritance, there's always that.

I'm scr*wed!

This is not a time for a candidate who will offend no one; it is time for a candidate who takes clear stands and kicks ass.....Molly Ivins

More likely selling stuff on e-bay.

Many people are tapped out.  They have refinanced multiple times in recent years and have been on a wild spending spree buying vehicles, big screen TV's, putting on house addition etc... The well is starting to run dry and the high cost of fuel had really added to monthly pain.  This economy has been running on borrowed money.

I'd love to have your help on the economy team if you are interested. You are right. Our economy is being run with borrowed money. China is lending us money so we can keep buying their stuff. They have all those people they have to try to keep working. At some point that whole deal is going to blow. Then we'll have a not pleasant recession to follow this not pleasant recovery as I read on Economist's View, one of the blogs I like. We'll just have to have much smarter people in place to deal with it. Gotta get that started this year.

Cash does go down in value. That's why people with a lot of money have to invest it - so it at least keeps up with inflation.

Yes, if you put your money in a piggy bank it loses it's value in purchasing power through inflation. If you put the money in CDs or T-bills, they earn interest to offset the rate of inflation. You're $100 for example remains $100 in a savings account or bond. If you put it in stocks or other types of investment that can go down (greater risk) your $100 can go to 0. This is what the wealthy have been doing with their wealth, putting it in investments and buying things like art and gold. They leave it to China and Japan to finance our national debt, because they have no interest in actually saving money or buying savings bonds. They also buy real estate, which is now feeling the pinch around the country. Speculators inflated those markets the way the day traders did during the dot.com stock years. I'm not saying investments aren't a good thing. Just saying that to have an entire generation or two that doesn't have any idea that putting money into savings is also a good thing, has hurt us as a nation. It's all been the politics of personal greed. When we had WWII, people bought Victory Bonds. After 9-11, what did they tell us to do? Go shopping, use plastic.

Interest rates on savings accounts certainly do not keep up with inflation anymore, and neither do most CDs. It's not like those CDs during the 80s. Of course, I wouldn't have wanted to get a mortgage then. Bonds do very well, but you can't touch them for seven years. That's why so many people have gone into risky investments. If and when interest rates go up, like you said they would, people will certainly save more. I personally am a saver, but I don't blame people for not wanting to do so in the past few years. Hey, with E-Bay, you can sell all that crap you bought with plastic.

Like when Carter was president and maybe even Reagan, still, we have passbook savings accounts that paid 5% interest or 5.25%. Series EE government savings bonds paid quite well. People saved money using these savings methods and accumulated wealth with compounding interest. I've met people who retired early on the money they made from series EE bonds, when I worked in Florida. People could calculate how much they had to save for how long and count on that rate being there for the long haul. Interest rates for CDs are over 5% now and rising. The rule of thumb for older people not able to risk their capital is to try and find safe alternatives that pay 6%. If people can get that in a CD or very safe municipal bond that can't go down in value, I think you'll see money going there. The problem is that people are spending more money than they have coming in and are trying to manage their own massive personal debt.

You are a wise woman Reg. Alan Greenspan has even said to pay yourself first, like 10-20% of what you have coming in as personal income.

As for impulse shopping for "want." that's exactly right. I read in Better Homes and Gardens an article on managing personal debt. It suggested getting rid of all credit cards except one for emergencies. They put that card in a container of water and freeze it. If you think you want something, you'll have to wait for the chunk of ice to melt, before you can buy it. Take that time to decide if you really need it. Or better yet, go for a walk or read a book instead of shopping for entertainment. Invite a friend over for tea, coffee, that sort of thing.

that if you have debt, especially credit card debt, that it means you go around blowing money. That may be true in a some cases, but not in most. Most debt that people have now is medical debt. Some people even payed their medical bills with credit cards (not wise, but not exactly a big screen TV). I have credit card debt, because I hit a hard year a few years ago and had to start paying bills with credit cards. Yeah, I'm not perfect, but I'm no big spender either, and I'm coming out of it.
My mother recently had to declare bankrupcy because of madical bills. Her insurance company decided that her heart problems were too expensive. So, they stopped covering it right before she found out she needed surgery.
It's not true that everyone who has debt is irresponsible.

The seven year thing may be true about buying bonds directly, but it's not true with bond funds.

Almost my whole portfolio is in GNMA/FNMA kind of mortgage bond funds. They pay interest monthly (currently 5.75%), return principal from time to time, and can be bought and sold anytime. They also go up and down in value, depending on interest rates, but if you keep them to maturity, you always get your principal back.

They're good for people near or at retirement who can't take any risks, since that's what they live on.

Stan Davis
Lakewood, CO
BE THE CHANGE you wish to see in the world.
If not us, WHO? If not now, WHEN?

if you already have money. We're talking about people starting out saving money. You can't get into those funds without already having a substantial amount saved.

You are very careful with money and I don't doubt that your mother is also. Young people are being saddled with debt for education, with debt for housing (not uncommonly more than they really can afford), debt for cars, and debt for all the things they think they need right now. Currently, people are paying out more than they bring in income. Get hit with a medical bill that's not covered or another crisis like natural disaster that's not covered and you are totally screwed. Now, the Republicans wanted to make it more difficult to declare bankruptcy.
That doesn't mean people aren't doing the conspicuous consumption thing and the credit card companies, government and retailers are encouraging them to do it. Home Depot's new slogan on advertising is "love it now, pay for it later."
Prices are higher for imported goods. Do people really have to buy this stuff? Do we really have to keep on the path of having huge debt to China, so they can loan us money to keep buying all the stuff that comes from China? It's a crazy cycle.
Currently we are being flooded with furniture, TVs and toys made in China. Last year it was clothes. Why don't we find a way to sell this stuff at cost in Latin America, Africa or another country where people really do need this stuff, because they have nothing? If people really need something, buy domestic. Let's be proactive on this stupid trade deficit.
I have friends and family members who also have declared bankruptcy in their lives. Some had circumstances like your mother. Others just went crazy living beyond their means buying stuff.
It's great when you raise all these points, because you are teaching. That's the point of the series...get the little gray cells going. Maybe we'll hit on some solutions:)

I don't know if they have a minimum amount to get started or not.

My "savings" comes from rolled over 401Ks, inheritance (not very large, really), and a house sale when I started renting. I wasn't much of a saver on my own, but I never touched my 401Ks (which had company matching funds) while I was working.

These days, though, matching 401K funds may be a thing of the past.

Stan Davis
Lakewood, CO
BE THE CHANGE you wish to see in the world.
If not us, WHO? If not now, WHEN?

are mutual funds and considered an investment, not savings. There's a fine line, I know, but look up the definitions of each and it will make more sense to you.

...but for all practical purposes they're the same.

Stan Davis
Lakewood, CO
BE THE CHANGE you wish to see in the world.
If not us, WHO? If not now, WHEN?

Investments don't go toward paying down debt when you look at the private/public debt outlook. China and Japan own our T-Bills. When you have a mutual fund, you don't own anything but the mutual fund. From your point of view as income, investments are the same as saving, but in the larger scheme, it's not the same. We already talked about the risk side of it.
All good points and good for people to know, keeping thinking.

As for the penalizing people for saving on college aid applications, I agree that it's not right to penalize savers. What is happening with the cost of higher education is so screwed up in that a person used to be able to go to a state university and not have to have their family break the bank or become an indentured servant to pay off the loans after graduation. We've lost that option of choice in how states figure tuitionfor state universities. Even community colleges are getting more expensive.

I've read that they are telling people to have their kids just take out the loans on their own, as they have more time to make money. Parents have only so long to earn money to save for emergencies and old age. It's twisted that it's come to this. What do you think the answer is? I read that in Wyoming, the natural gas boom is making it possible for kids to got to state university there free. Perhaps if we got off our addiction to middle eastern oil and had more options for energy that enriched more states, they could go back to having affordable colleges. Parents could be able to save money like you say you are doing.

was a disaster. I agree that they shouldn't penalize parents for saving, but after my experience, I don't think they should penalize kids because they're parents are deadbeats either. A lot of it also depends on when you fill out the form. It's first come, first served. There needs to be a better way to handle the whole thing.

There needs to be a better way for the entire college financing thing. I paid my way through school and paid back the loans, but it was nothing like what kids are expected to borrow today. I went to my state university and the state just seemed to cover more of the cost back then than they do now. Of course, that was a different time. Health care was fee for service and insurance paid. If you didn't have insurance, doctors worked with you and the city hospital was there if you had no money at all. We were a different culture.

My mother says that when we were growing up in the 50s and 60s, that prices didn't really change. There wasn't inflation. She says if she had to do it now, she couldn't afford to raise her family. They had decent mortgage rates and decent savings account rates. She lived in a different culture than I did.

What you've inherited from all those years since Reagan was president is a travesty. We need an entire overhaul.

The college financial aid thing needs a definite overhaul. It turned out that my son managed to get merit based scholarships and a couple private scholarships that cover more than 2/3 of the $30K cost. With the Stafford loan, summer work and my help, he should be OK after 4 years -- at this point he doesn't even qualify for work-study programs...

College costs, just as medical costs, really need a look. I'm not convinced that the cost of educating someone at a small liberal arts college in northern Indiana is $30K a year. Schools need to operate in the black and must pay staff and professors a realistic salary, but when a college education costs $120K there is something dreadfully wrong.

Blue State of Mind

My parents attended the University of Oklahoma in the 40s with no tuition at all for in-state students.

When I started the same place in 1965, tuition was $7/hour. Five years later it was still only $14.

I have no idea what it is now.

Both my parents worked full-time, but we had no savings at all. Our home was very modest, and we'd never bought a new car. We lived from payday to payday. The friendly National Merit Scholarship people determined I needed $500 a year to go to Northwestern based on financial need. That wouldn't have even paid my transportation four times a year. So I transferred the scholarship to OU, and the amount was reduced to $250, which paid my whole tuition for the first three years.

Stan Davis
Lakewood, CO
BE THE CHANGE you wish to see in the world.
If not us, WHO? If not now, WHEN?

instate tuition, plus dorm fees and books, my friend's son is going to pay something like $16,000 or $19,000 a year. I forgot which one, but they are both amazing to me. Another friend's son is going to live at home the first two years and go on scholarship to community college. It will cost him very little. He can start saving to pay for those last two years somewhere else. He made that decision himself when he saw what going away to college was going to cost him. He is from a family that isn't comfortable with debt. I'm glad he's learned that from them.

That's really too bad.

I'm not sure that if I'd wanted to stay home for college they would have let me. At least they encouraged me to go away. They firmly believed that "leaving the nest" and the social aspects of college were at least as important as the academic aspects of college life.

I went to college for about $300/year for tuition, books ($30 each or so), spending money ($100/month, to include social life, laundry, toiletries, etc), and about $120/month for room and board. I used my Dad's credit card for gas. Visas didn't exist.

Of course that was in 1965-1971. It was in that era that my Dad said that he didn't want to be rich and that if he and Mom made $20,00-$25,000 together, they would feel very comfortable.

Gas was about $0.30 a gallon, cigs about $0.35 a pack.

Stan Davis
Lakewood, CO
BE THE CHANGE you wish to see in the world.
If not us, WHO? If not now, WHEN?

 In New Jersey we just finished the second year of the Starz program. Students in the top 25% of their high school class can attend their local community college tuition free. If they keep their grades up in college they can go on to a state college or university tuition free.

That doesn't solve the entire problem but for a state that's $4.2 billion in the red this year its not a bad start.

Barry

          Are you safer today than you were five years ago?

Both my friends sons are in this category. Still, doesn't it seem too bad that only those in the top 25% get the break on community college? It used to be those were the kids who went to the better colleges and community college was there for everyone to get on with their education. Now, it's totally based on money and class. If you aren't rich, you go to community college.

As for my friend's son, he made his choice. They left it up to him. He didn't want the debt. Kids don't really mature until about 26 (at least with males) so living with them a year or so isn't going to stunt his growth.

 As I said its only a start. But you do have to start someplace.

Its also possible to get creative with this. I'm working where we're going to have one campus, the first two years are a community college, the second two years a state university. One campus, one application process, no transfer (expect on paper) but it matches this funding formula. Again its not a perfect, or even complete, solution but its an even bigger step forward. 

Barry

          Are you safer today than you were five years ago?

what your college is doing there in NJ. I like that the student only does one application.

I got into a good school, and I had no idea how I was going to pay for it. A teacher from my high school told me to just show up. He said if I was physically there, they probably wouldn't throw me out, and would figure out a way to make it work. I managed to make it work for 4 semesters. I think I still owe them money.

My brother did the same thing in the 60's going to Columbia. He ended up declaring bankruptcy from the wieght of his loans during the time they let people do that, but that went away a long time ago. Now, if you haven't paid off your school loans, they take it out of your SS payments. I guess people have to realize education can be a cradle to grave debt. It's crazy and needs to be overhauled. We need a system like Germany so that kids who aren't college bound get a good education preparing them for a track like becoming a master mechanic or something. These are respected and well paid jobs in Germany. The training is part of their high school education.

 The German system may have been fine in the Industrial Age but it doesn't seem to be working today. With 11% unemployment Germany has more to worry about that we do.

Barry

          Are you safer today than you were five years ago?

unemployment rate has to do with the remaining issues from unification. The system I described was started in West Germany. I hope it's a going concern in all of Germany now. They also have a large immigrant population there. They used to habve generous welfare benefits and unemployment, but I imagine that changed. When I lived there you got unemployment for the duration and you were not expected to move to get a job. People were also much less likely to change careers there. It's a totally different way of thinking. Still, much has changed since I lived there. They still need master mechanics and they still have manufacturing in Germany.

 Reunification clearly still remains an issue but that comes on top of moving forward, and away from the Industrial Age.

What is a "Master Mechanic" today? Its certainly not what it was 20 or 30 years ago. Cars, trucks, etc. are very different today. A mechanic needs to be able to think, use logic, to isolate a problem today. "Trouble shooting" has changed to debugging even for mechanics. (A friend of mine is a mechanic who came here from Europe, don't get him started on this!   )

One of the problems many European countries are facing is that people don't change careers. That won't work in a world of rapid change. In Germany the countries largest chip manufacturer moved the factory out of the country because the work force resisted change. Meanwhile AMD, a US company, moved in because starting with a fresh work force they could build a modern plant. That's very similar to what's happening to our auto industry. The US auto industry, and work force, was comfortable doing things the old way and have resisted change. Now US owned plants are closing while the Japanese, Koreans and Europeans build new plants.  Perhaps if US companies and the US work force (unions) had possesed a bit of vision things would be different today.

Barry

          Are you safer today than you were five years ago?

"Master mechanic" could translate into a number of job titles that don't require college, but could be respected work done by people trained on a high school track. BTW, when I lived in Germany, the guys who kept my car going after it was damaged by standing in water on the ship going to Germany by the Army, were brilliant. I wish I had them here, even though I drive a Prius now. I trusted them with my life, literally. I drove all over northern Germany on the autobahn.

 I'm happy to have my European mechanic here for sure. But I think that the difference is that he cares. And while he cares about my car, or any customer's car, mostly he cares about doing the job right for himself.

I think the issue is that word "trained" where ever it occurs. "Train" someone in high school, or a vocational school, or even a university and they are not prepared for the world as it is today. "Train" can be defined as "to form by instruction, discipline, or drill" or "to make prepared (as by exercise) for a test of skill". Focusing on a "test of skill" especially is a short term approach. "Educate" on the other hand can be defined as "to develop mentally, morally, or aesthetically especially by instruction". That's preparing a person to think, to deal with situations as they come along and that's what's needed regardless of what sort of work a person would like to do. 

Barry

          Are you safer today than you were five years ago?

Very good points, Barry, but in my experience as an occupational therapist working in school districts where the average IQ of those attending is 90, training is very important to them. Some of them are attracted to and very good at being firemen or EMT's, because it is so focused on training, drill and re-training for new skills and knowledge. It's what attracts many people to the military. Not saying they can't be retrained to do something else, just saying education as you've defined it doesn't work for eveybody and is what pushes many to drop out of school.

This is very true but the big issue is that credit is given too freely with almost no regard to an applicants current debt load.  The bar for obtaining a mortgage or credit card was much higher a few decades ago. If you had a high debt load, you could not get credit cards or a mortgage.  Now you can be in financial trouble and the credit offers keep coming in and getting approved is automatic.

In fact I think that this is a huge issue. Instead of the GOP insulating these credit companies that prey on financially foolish people by outlawing personal bankcruptcy congress should make these companies pay for the debt in cases where the applicant should never have been given the credit to begin with. Of course I'll bet there is a money trail to congress that helped get that anti-bankruptcy legislation passed.

And a lot of these practices are illegal in most states, but if the bank is located in a state where it is legal, it doesn't matter where the cutomer lives. I'm talking about lending to people that they know can't afford it, these ridiculous interest rates and fees. That stuff is illegal in most states.

supported the anti-bankruptcy legislation, being from Deleware. Any Democrat who signed on to that one should have their head examined if they think people are going to vote for them next time.

When I first got out of college, it was hard for me to get a credit card, because I wasn't a man. That's how much times have changes.

Paying for college sure could be a topic for our gumshoe in the future. Bluemoon was going to do one, but she changed her mind. If you want to join the economy team PA, I'd love to have you. I'd love to have Reg, but she's doing the youth team.

Newly married, I was a graduate teaching assistant making $225 a month in the fall of 1969. Visa turned me down. So I waited 'til my summer job as a computer programmer at $750 a month and was approved.

Now I think you can get a credit card specialized for lovers of Ragu herbal spaghetti sauce.

Stan Davis
Lakewood, CO
BE THE CHANGE you wish to see in the world.
If not us, WHO? If not now, WHEN?

came automaically with a checking account I opened just because I was a student. Of course, being away from home for the first time, and my dorm being a block away from the worlds largest record store, this turned out to be bad. Thankfully, they didn't give me much of a credit line. Good learning experience.

came when I'd graduated college, already gotten credit to buy a car and had a professional job. Even then, I couldn't get one until a friend with a friend at a bank put in a word for me. It was tough being a woman back then. I can see how just giving you a credit card with a checking account made it so very tempting. I have never been comfortable with living on credit. I don't carry a balance on my one credit card over to the next month, so no interest and fees. I'm going to start writing down what I buy, like I do for checks when I use it to keep track better. I want to save more now that interest rates are making it worthwhile. Money Market accounts used to be soooo nice for that "cushion" money. I've got 10 years to go to pay off my house. If I can get that done early, that would be good too. I rented for so many years, that if they get rid of the tax break on mortgages now that I finally have one I can use for deductions, I'll be so pissed. The plan that exempts mortgages below a certain amount, but not the ones for the McMansions would be OK. Maybe people would have to think harder before buying them with an ARM.