20.04 2011

Business Owners – Who Keeps You On Track?

Being the owner of a business can be a lonely affair at times, for those businesses with staff, generally speaking there is an element of support provided by all the staff towards each other, a good boss will also provide a good level of support, helping their employees with problem solving, developing their skills needed to do their jobs and being there to listen to their ideas and problems. Who supports the business owner, who is there to bounce their ideas off of, who is there to talk them through specific problems, who is there to offer them all the help they need or be able to advise where to get the help they need?

Partners and friends are a good start, but how honest are they in telling the business owner that they may be way off track?

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20.04 2011

About the Financial Literacy Summit

As promised, yours truly dutifully waded through over two hours of dense talk from some of the most important gurus of personal finance. Imposing experts included the Treasurer of the United States, Rosie Rios, and the Chair of President Obama’s Advisory Council on Financial Capability, John Rogers, Jr. A lot of the discussion was about policy and programs to distribute, measure and improve financial literacy training.

One tip stands out. Ian Solomon, the United States Executive Director at The World Bank, had a great idea to link financial training with events. He talked about two kinds of events: big life events and transactional moments. The first one we’ve all experienced: getting a brochure and Q&A sessions when we take on student loans or sign up for a credit card. The

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19.04 2011

S&P Credit Rating on US Debt is overrated

Yesterday Standard and Poors, a credit rating agency, lowered its outlook on the prospect of the US political system making serious progress on dealing with the mounting debt. There was no change in the actual rating they give to US treasuries and bonds which remain at AAA, but it hardly matters because no one cares what S&P has to say about US debt.

Why? Well, the point of the rating agencies is to tell us something about bonds that we dont know. For example, how safe are the bonds of Kenosha, Wisconsin?

But everyone knows about the situation in the US and the bond market sets the price daily. How risky is US debt? Check the price on the bond market:

The bond market confirms what everyone knows, the US is not going to default on its debt obligations. Read more…

18.04 2011

What is the importance of establishing business credit?

A business credit is needed by a businessman either to set up a new business or to expand a running business. Various banks are available to provide you with credits for your business but you should choose a bank which can provide you a good rate of interest. The business credit allows you to know all the details and important financial handlings required for your business. If you can show the bank that your business is successful, then you can become a treasured customer for the bank. It not only makes you feel better but also adds a good grade to your reputation.

If you are having a new business plan then you have to show your bank the prospective success which sometimes might be a little difficult.

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15.04 2011

Why The Consensus May Be Wrong About Chinese Rebalancing And US Interest Rates

I mentioned in last week’s blog entry that during my trips to New York, Washington and Hangzhou in the past two weeks one of the common themes was concern about rising debt levels and weaknesses in the banking sector.  Another theme – one which I want to discuss in this entry – was the possible impact of China’s rebalancing on US and global interest rates.  A lot of people were very concerned that if China does indeed rebalance, US interest rates will soar.

The argument runs like this.  If China raises the consumption share of GDP faster than investment declines, this will result in a reduction in China’s current account surplus.  Clearly if China’s current account surplus drops, the amount of capital it exports must drop in tandem – since a rising share of consumption means a declining share of savings and so a declining excess of savings over investment which must be exported.

But becau

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14.04 2011

More taxpayers stashing than spending their tax refunds

CHICAGO,  – Fewer workers plan to use their tax refunds to pay off bills and more plan to put the money into savings, reflecting a more stable economy. According to a new CareerBuilder survey, 46 percent said they plan to use their tax refunds to pay off bills, down from 56 percent last year. In addition, more than one-third (36 percent) of workers report they will use their tax refund to augment their savings accounts, up from 34 percent who said the same last year. The annual CareerBuilder survey was conducted among more than 3,900 workers.

Workers may be feeling a little more fiscally secure because fewer are living paycheck to paycheck. While more than six-in-ten (61 percent) said they currently live paycheck to paycheck, this is down from 77 percent who said the same in a study conducted between May 18 and June 3, 2010. In

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13.04 2011

Banks vs. Credit Unions: Which is Better For You?

Many consumers are looking at their financial institutions with a more critical eye these days. In the wake of taxpayer bank bailouts, decreased rates on savings accounts, and impending disappearance of free checking, its not surprising that bank customers are questioning whether they should keep their money at a bank. Last year, Bank of America alone lost 400,000 accounts, according to the Move Your Money project.

One alternative to big banks is credit unions. With services and products as competitive as big banks offerings, credit unions are becoming more popular among consumers.

Credit unions operate very differently from big banks.

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