Friday, July 31, 2009

Honda Recalls Another 440,000 Cars

As the owner of a 2002 Honda Civic, I found this interesting and thought I should pass it along:

Honda Motor Co. said Friday it widened a previously announced recall to add 440,000 cars that could have a lethal airbag defect. Affected models include the 2001-2002 Honda Accord, 2001 Civic and 2002-2003 Acura TL.

The potential defect has caused 6 known injuries and one known death, according to Honda spokesman Chris Naughton.

In the meantime, Honda owners can log onto the Web site and click on the "Owner Link" to get a status of their recall.

For more on the recall see:

Dealing With Debt Collectors

When I was younger, I got in to a bind with my bills and didn't know how to deal with it. It caused me so much grief and anxiety, I was to the point that I would not answer my phone. I even left a job that I loved just so the bill collectors would not call me a work any more. No one wants to find themselves in that type of situation. What I didn't know and what everyone should know is that most bill collectors are not as hard to deal with as you might think. They want their money, so if you can show them that you're honestly trying to make that happen, then more than likely you can work something out.

It pays to familiarize yourself with the Fair Debt Collection Practices Act, which protects consumers from unscrupulous collection practices. If you feel that your rights have been violated, you can report the incident to the Federal Trade Commission or file a lawsuit to collect damages. Be honest with the bill collector. Let them know if circumstances beyond your control have caused you to fall behind or stop making payments on your bills. They will still try to collect the debt, but it could buy you some time and it may make it more likely that they will work with you to resolve the situation in a way that is suitable to both parties. You know how much you can afford to pay each month, so don't let them convince you to pay more. You still have to have a place to live and food on the table. If they are insistent on your paying more, you may need to seek legal counsel. Every time you speak with the collection agents, take notes! Write down highlights from the conversation along with the date and time of the call. These notes may prove helpful if the collector contradicts himself on future calls, or if you end up filing a complaint or lawsuit. When you reach an agreement with a collector, make sure you stick to it. As long as you keep up your end of the bargain, the collection agency can make no further efforts. If for any reason you are not able to pay as agreed, call them immediately and let them know when you will be able to pay.

No one likes to deal with a collection agency, but if you are honest and reasonable, it's rarely as bad as you think it will be. In most cases, you can work out an agreement, get your debt paid and get on with your life.

Thursday, July 30, 2009

Job Search

I'm still looking for a new job. If you've read any of my previous posts regarding the job search, you'd know that I've been concentrating my efforts on a state job in Missouri. I am now on the state register for 13 different jobs. Would love to get a job with probation and parole. My experience with the Sheriff's department in Harrison County Mississippi leads me to believe that I would be very well suited for this type of job. However, I also scored very high on the state test for computer operator trainee, which involves working with mainframe computers. I don't really have any experience with mainframes and all of my computer experience is self taught. I have repaired and upgraded several computers over the past 9 years and seem to have a knack for it, but don't know how well I would do with the big computer systems.

I was reading an article in the waiting room at physical therapy, while waiting for my neighbor to finish with the therapists. It was talking about all the searches on Google for how to become a male porn star or how to get a job as a beer taster. Don't think I could ever get in to the porn business, unless fat hairy middle aged guys suddenly become the rage. As for beer taster, I've never really liked the taste of beer, so that's probably out as well. Although, if you know of anyone hiring for bourbon and coke tasters, please send me an email, lol.

I'm not really suffering too much compared to most of the unemployed. I do have enough money to live on and I am still building my investment portfolio, but everything is kind of in limbo until I have a regular income again. My bills are going down very slowly. That will be my main priority when I do return to work. To finish paying off the $6,000+ in credit card debt that I'm currently carrying. Then all of the money that I've been paying towards debt reduction will go towards building my investments. I definitely want to get in to investing in rental properties, so that will be my next goal after paying off the debt. I'll probably start small with a four plex apartment building and see how that goes before I get more involved with rentals. I'm also interested in owning a self storage facility. We'll see how it goes.

Sunday, July 26, 2009

Investing In Brazilian Utilities

In a move to further diversify my portfolio and produce earnings from outside the U.S., I have decided to buy shares in one of Brazil's largest utilities providers, CPFL Energia S A ADR (CPL:NYSE). At their recent price of $51.16, their dividend payout of $3.69 per share represents a current yield of 7.22%. The Group's principal activities are those of a holding company. It operates through its subsidiaries in the generation, distribution and marketing of electricity. The Group has 8 distribution centers serving 568 municipalities in Brazil. It sells electricity nationwide on the free and the regulated market and also provides value added services to its customers. The Group operates in the states of Sao Paulo, Rio Grande do Sul, Parana and Minas Gerais.

With Brazil's dynamic progressive and growing economy, demand for electricity will only increase going forward and CPL is in a good position to take advantage of future business. With earnings of $4.19 per share and future earnings expected to increase, the dividend looks to be on stable ground. It should make a fine addition to my long term holdings.

To further diversify my holdings, I will be looking for quality dividend investments from India, China, Canada and possibly Russia.

Friday, July 24, 2009

Today's Stock Trades, Regency Energy, BP

Decided to sell my stake in Regency Energy Partners (RGNC) for a quick 24% gain. I mentioned in an earlier post that I would consider selling if the gain went over 20%, just didn't think it would happen so soon. This frees up quite a bit of cash, so I've decided to reinvest the money in shares of ConAgra (CAG) and British Petroleum (BP). I like the dividend payouts and the long term prospects of both companies. My positions in both stocks are for the long haul, as long as the dividends hold up.

I'm still holding shares in a couple of energy limited partnerships. The dividend payouts are good on both, albeit a bit questionable due to recent earnings. Am hoping to trade out of both with a small profit, we'll see how it goes. I see from the news on that Warren Buffett is reiterating his advice to "buy American." I can't help but agree, since I'm still seeing what I consider bargains in some great stocks. My biggest regret is that I don't have the money to take advantage of everything I find. But I know that opportunities will always reveal themselves to people who look for them. I'm always on the look out for a great investment opportunity.

Wednesday, July 22, 2009

Some Favorite Quotes

Dave Ramsey's column, Saturday July 18th, on teaching your kids about responsible spending, "If there are video games or music that you feel are inappropriate, then they don't get to buy that stuff-period. If they put trash, filth and nastiness into their minds and spirits, they're going to become trashy filthy and nasty."

From the Motley Fools column of the same date under Ask the Fool: "Strong dividend paying stocks can turbocharge your portfolio. In, "The Future for Investors" (Crown Business, $27.50), Jeremy Siegel reports that an investment in the 10 highest yielding of the 100 largest S&P 500 stocks would have returned more than 15.7% annually from 1957 to 2003, turning a $10,000 investment into more than $8 million. Compare that with an annual gain of 11.2% for the overall S&P 500."

Recent Stock Trades

Decided to sell Copano Energy (CPNO) for a profit of 27%, with earnings down I am concerned about their ability to maintain their dividend payments. I will be reinvesting a portion of the proceeds from the sale of Copano in ConAgra Inc. (CAG). Their earnings per share of $2.15 per share is more than sufficient to maintain, and possibly increase, their dividend of 76 cents a share, which represents a 4% yield on the current price per share. While energy use may be declining in the current economy, people still have to eat, so upping my stake in ConAgra looks like the way to go.

For my IRA account, I'm adding more shares of AT&T (T). While their dividend payout of $1.64 represents 76% of earnings, I feel that their dividend is in little danger of being cut. AT&T is a long term holding in my personal portfolio as well.

My stake in Regency Energy Partners (RGNC) is doing well. It is up nearly 20% since my initial investment. Their dividend payout is around 62% of earnings, so I'll probably hang for the dividends unless the unless the price goes up over 20%. In that case, I would take the gain, since I initially bought the shares of the energy partnerships for short term gains. We'll see how that plays out.

Tuesday, July 21, 2009

Should Michael Vick Be Reinstated With The NFL

Now that Michael Vick has served his time, there's a lot of talk going around about whether or not he should be reinstated with the NFL. At first, like a lot of others, I thought no. He had his chance and he screwed up, so why should he be allowed back? But then I started thinking about my own brush with the law and how it has affected my life. I have a felony conviction from over 20 years ago. Something I'm not proud of, I committed embezzlement. Nothing on the scale of Bernard Madoff or the Enron people, but I took the money and I had to pay. I learned my lesson, served my time and am still being punished to this day. Even though I was a model prisoner by any one's standards and haven't had so much as a parking ticket since my release, the fact that I was convicted keeps me from getting a decent job. The point is, if I feel it's wrong for people to judge me, over something that happened over 20 years ago, then why should I judge Michael Vick? I hope he is reinstated. He has done his time, hopefully he's learned his lesson and will stay out of trouble.

The real question is, if nobody is willing to give convicted felons a job, then what are they supposed to do? Return to a life of crime? I don't want to be a criminal, obviously I was no good at it. I just want to get a decent job and lead a productive life. I'm sure that Michael Vick is thinking the same thing. He did something stupid, did his time, now he just wants to get on with his life.

Sunday, July 19, 2009

Dividend Stock Investing Is Far From Dead

Dividend stock investing has been an attractive investment strategy for several reasons. They provide you with a real return immediately, in the form of dividend payouts as opposed to growth stocks, which only provide profits when you sell. Increasing dividend payouts, offer the shareholder a hedge against inflation not provided by non dividend paying stocks. Shareholders are able to choose what to do with dividend cash, paying bills, adding to cash savings, reinvesting in stock or whatever strikes their fancy. Now that so many weak dividend paying companies have either cut or eliminated their payouts entirely, it might seem as though dividend investing is no longer a viable strategy. On the contrary, getting rid of the weaker dividend payers has made the stronger companies even more apparent, making it easier to build a solid dividend portfolio. In fact, with stock prices well off last year's highs, dreadfully low interest rates, dividend yields higher than they've been in years, now is an excellent time to load up on the best dividend stocks.

Some things to keep in mind when searching for dividend stocks:

Look for stocks with above-average dividend yields (currently 2.25%). I personally shoot for around 6 to 8% yields, higher risk yes, but potentially much higher returns. You will also want to make sure the company generates enough free cash flow to maintain and possibly increase its dividend, otherwise it's doubtful they will continue payouts. While it's no guarantee of future returns, it's also beneficial to look for companies with a long history of increasing its payouts in proportion to earnings growth. If the company is growing earnings it should be rewarding shareholders with increases in dividend payments. In order to accomplish all of the above, you would definitely want any prospective investment to have a solid balance sheet. If they are carrying too much debt and are unable to repay creditors, they will not be able to pay you.

So even though we've seen drastic cuts in payouts, from some dividend stocks and others who have eliminated their dividends entirely, now is really a good time to be a dividend stock investor. Far from being a dead investment strategy, it may prove to be one of the best strategies going forward.

Tuesday, July 14, 2009

Citigroup: Again With Executive Pay!!!

The "New York Times" reported that Citigroup has decided to raise employees base pay to avoid the flack over year end bonuses. Some employees will see as much as a 50% increase in salaries. The Obama administration was caught off guard once again, since they seem to know nothing about Citi's plans. In my opinion, we should think twice about supporting people in the next election, who seem to be so fast and loose with the taxpayers' money.

On Monday, banking analyst Meredith Whitney recommended Goldman Sachs [GS 149.75 0.31 (+0.21%), which represents a shift in her more recent bearish position on financials. Now there seems to be some concern over executives with GS selling shares (close to $7 million worth) during the time they were benefiting from TARP loans. I'm not especially concerned over this, since they managed to keep the company from going under, which is more than can be said for other overpaid bank executives.

I don't plan on investing in Citigroup or GS, but if I were, it would be Goldman Sachs which, as far as I'm concerned, is obviously a much better managed company.

Sunday, July 12, 2009

RICHDAD: Investors: Don't Be Average

Just read a fantastic article from my favorite author, Robert Kyosaki, who wrote and published the Rich Dad Poor Dad series of books. He has some interesting things to say about the current economic crisis and what real investors should be doing now. You can read his blog post at:

RICHDAD: Investors: Don't Be Average

I've read most of Mr. Kyosaki's books and they have been most helpful in shaping my philosophy about investing and making money. My favorite, "Rich Dad, Poor Dad", really changed the way I viewed money and set me off on an entirely different approach to building personal wealth. I consider his books a Must Read.

Friday, July 10, 2009

Merck and Schering Plough Merger

It has been an uneventful week in the stock market. Although I'm pretty pleased with the merger agreement going forward with Merck and Schering Plough. I own shares in both companies and stand to get some cash, $10.50 per share plus .5767 shares of the New Merck for each share of Schering Plough I own. I like the mergers where I get cash, cash is almost always good. Since I bought both stocks when prices were low, I should come out ahead on the deal. Plus the new company anticipates continuing Merck's current dividend payout. So that's the bright spot for the week.

Made some changes to the appearance of my blog, trying to encourage more visitors, I think it's a big improvement. Be the first to sign up as a follower of my blog!!!

News affecting the economy was not particularly good this week. Obama's approval rating is slipping over bailout programs and lack of results. Warren Buffett thinks we need another stimulus package, although I'm a huge fan, I disagree with him on that one. And the jobless rate continues to rise. While it all seems a little overwhelming at times, we just have to keep in mind it won't last forever. Things will eventually gravitate back towards the norm.

Fixing Your Credit Score

You don't need to hire anyone to fix your credit. It's one of those things that, if you want it done right, it's better to do it yourself. The best way to improve your credit score is to pay everything on time, every time and reduce your account balances as rapidly as possible. Then it's just a matter of time before your credit improves.

A couple more things to keep in mind, credit agencies like to see a variety of credit. They want to know that you're capable of handling all types of borrowing and that you are responsible with your money. So it's better to have a mix of revolving credit, secured debt like mortgages or car loans and student loans. Then too, the longer your credit history, the better. As you pay off your credit cards, don't cancel the cards, just stop using them. The available unused credit and the amount of time you've had your card, will help improve your credit score.

Last, but not least, you need to use credit to build credit. I had a friend who was turned down for a mortgage, even though she and her husband both had well paying jobs, thousands in savings and no debt. The problem was, they never used credit cards or took out loans for anything, so they had no credit history at all. You don't have to carry balances on your credit cards, but you do need to use them to build up your credit history.

One thing everyone should do is, review their credit reports annually. You can get a free copy of your credit report once a year from the three major credit reporting agencies by visiting:

Thursday, July 9, 2009

A Second Stimulus?

While talk is circulating among top Democratic leaders about the possible need for a second stimulus plan, the Republicans are wasting no time putting Obama and the Democrats in the hot seat for lack of results from the original stimulus package. Personally, I've seen no improvements in the economy other than some stabilization in financials and the auto industry. I tend to agree with some who think that any further stimulus package should include payouts to taxpayers, legal citizens of the United States. If they want to get the economy moving, give the money to the people who will put it back in to the economy, i.e. consumers. The banks have horded stimulus money, while at the same time increasing the burden on the taxpayers through fee and interest rate increases. If you're not helping the cause, then you're hurting the cause. Charging more fees and higher interest rates while cutting charge limits is not going to get consumers spending again. I personally have stopped using credit cards entirely.

The real bottom line is, we are not going to see the economy improve until people go back to work. An unemployment rate of 9.5 % will continue to drag the economy down and now experts are saying it could go as high as 11 %. That's a great deal above the what Democrats predicted with the passage of the economic stimulus, so I think the Republicans and the American taxpayers are right to be throwing some hard questions towards the current administration.

Given all this, I think the stock market will remain down for the better part of this year and in to 2010. It does present some great buying opportunities, the price of good companies being down along with the bad. But it does call for investors to be very selective. As I mentioned in an earlier post, I've recently invested in Proshares TWQ fund, which shorts the Russell 3000 index, as a hedge against falling stock prices. I'm doing this on an experimental basis and while it is too soon judge overall effectiveness of this strategy, the price per share did go up as the overall market fell earlier this week. The real test will be its' effectiveness over a longer period of time. I'll keep the readers posted on how it's working out.

Wednesday, July 8, 2009

Welcome to My Blog

Saudações a todas as pessoas maravilhosas do Brasil e de Portugal! Obrigado por visitar o meu blog!

تحية الى كل من الرائع شعوب الشرق الأوسط! شكرا لزيارة بلادي بلوق!

Saludos a todos mis amigos de habla hispana! Gracias por visitar mi blog!

Приветствую всех моих посетителей из России! Благодарим Вас за посещение моего блога!

सभी भारत से अपने दर्शकों के लिए बधाई! मेरे ब्लॉग का दौरा करने के लिए धन्यवाद!

Zdravíme všechny své návštěvníky z Československa! Děkujeme vám za návštěvu mého blogu!

Hälsningar till alla mina besökare från Sverige! Tack för att du besöker min blogg!

Grüße an alle meine Besucher aus Deutschland! Vielen Dank für Ihren Besuch auf meinem Blog!

Auguri a tutti i miei visitatori provenienti da Italia! Grazie per aver visitato il mio blog!

Χαιρετισμούς σε όλους τους επισκέπτες από την Ελλάδα! Σας ευχαριστούμε για την επίσκεψή μου blog!

Pozdrowienia dla wszystkich moich gości z Polski! Dziękujemy za odwiedzenie mojego bloga!

Salutări de la toate mea de vizitatori din România! Va multumim ca ati vizitat blog-ul meu!

Tuesday, July 7, 2009

Tough Times Call For a New Strategy

When faced with tough economic times, it is important to review your investment strategy and make adjustments in accord with the changes in the direction of the economy. With seemingly no end to massive government spending in the foreseeable future and no provisions made to pay off excess debt, with the exception of some ill advised tax increases, I've decided to take a different approach. Robert Kyosaki, one of my favorite best selling authors, says that the rich make more money in a downward trending market than one that's going up. So I've taken a position in Proshares TWQ exchange traded fund. It is a leveraged ETF that shorts the Russell 3000 index of stocks. While I believe the stock market will eventually recover, I'm hedging my bets by shorting the market.

Another idea I'm looking at is investing more money in foreign shares. I like the fact that the government of Brazil is cutting spending to address their budget shortfalls, as opposed to increasing deficit spending the way our government has. While working with some good people from India on my last job location, I also came to appreciate their strong work ethic and entrepreneurial spirit, something we could use a whole lot more of in the U.S.. So I will be looking at ways to invest in India as well.

While this does represent a new approach to my investment goals, my overall strategy is still the same. Which is, to build a well diversified portfolio of dividend paying stocks to generate a steady stream of present and future income. There is always a way to reach your goal, you just have to find it. During these tough times, as investors, we need to stay on top of changes in the economic environment and change our strategies accordingly.

Sunday, July 5, 2009

Disciplined Approach to Investing: House Closer To Proposing Tax On Stock Trades?

Is the Democratic majority deliberately trying to turn the U.S. in to a third world nation? What type of insanity would lead them to even consider taxing stock trades? Wouldn't that be the very definition of double taxation, you're taxed on trading and taxed on profits? Check out the article below for more on this subject:

Disciplined Approach to Investing: House Closer To Proposing Tax On Stock Trades?

I definitely see why more wealthy U.S. citizens are retiring to other countries. The government is making a wonderful case for withdrawing your money and leaving the country. Sure makes a good case for not giving too much of a majority to any one political party.

Thursday, July 2, 2009

Legally Invest on Inside Information

Almost every book I've ever read about investing advises you to invest in what you know. I've found this to be some of the best advice when deciding where to put your money. In all of our lives we are surrounded by terrific sources of inside information. In my case, I used to work for a major restaurant chain. Every day I worked, I saw what went on there. I saw the products that sold the best and the ones that didn't sell well. I had access to the packaging the products were delivered in, so I was able to determine which companies the best selling products originated from. With that information, I was able to look up each company, determine their profitability and decide on the ones I thought would make the best investments. Since our restaurant was part of a national chain, I knew that all the other restaurants were ordering the exact same products. From this type of inside information, which is perfectly legal, I've been able to make some terrific investments in 4 great companies and have my eye on 2 more that I'm waiting to purchase stakes in, as soon as the price is right.

Another example of a type of inside information that is available to everyone would be the people you do business with personally. Who do you write checks to every month? Are they a publicly traded company? I've found it a lot easier to part with my money, when paying the phone bill or the electric bill, when I know that every quarter they are going to pay some of my money back in the form of dividend payments. A couple more things to think about, where do you shop? Where do you go out to eat? Have you looked in to the stocks of the companies you frequent the most. Chances are very good that you're not the only one going to these places over and over again. Take the time to look up their stocks. You'd be surprised how many of these companies may be way more profitable than you might think. Maybe they're not the ones you hear about in the news all the time, but then again, by the time they're in the news, they're usually over priced and ready to drop. Best to find these gems before they hit the news.

I really love the idea that when I leave a job, even if they have no retirement program, I'll be making money off them for years to come, through the stock dividends I receive from the companies they do business with. So instead of trying to keep up with the latest investing trends or to try and figure out how the latest tech companies are going to make money, invest in the companies who make the products and deliver the services that you use on a regular basis. You already know how they make their money.

Wednesday, July 1, 2009

INFLATION The Ugly Side of Obama's Spending

With all the hoopla and manufactured sense of urgency from the Obama administration, main street seems to be forgetting the ugly side effect of massive government spending programs. INFLATION! While the Democrats are so busy patting each other on the back over their bank, auto and insurance bailouts, their greenhouse gas reduction plans and the looming health care reform, what will they really have accomplished. If you make peoples lives better through health care reform and, at the same time, create skyrocketing inflation on everything else, in my opinion you've accomplished nothing. As soon as government spending kicks in, demand for oil and other commodities will see major increases leading to higher prices. At the same time, new debt to fund these programs will lead to a weakening dollar causing prices to go up even more. If they are truly interested in helping the poor and middle class, how can they possibly justify passing legislation that will ultimately lead to more taxes and higher prices? The only conclusion I can draw from what I've seen so far is, the current administration could care less about the people of main street.

I'm sure they'd argue, we needed to save the banks, the major auto manufacturers and AIG. As far as global warming goes, I'm still not convinced that it isn't a naturally occurring phenomena, nature's way of re-balancing the planet. Even if I'm wrong, which is entirely possible, scientists have already stated that unilateral implementation of green house gas controls by the United States may have marginal to no effect on global warming. Don't get me wrong, I'm all for solar and wind energy and reducing pollutants in our atmosphere, I just don't think we need to destroy our economy to do it. I think more can be accomplished by grass roots programs. Getting people to think more about recycling, cutting back on energy usage, switching to more efficient appliances and lighting would make a tremendous difference in our carbon footprint as a nation. We don't need ever expanding government to implement more control over our lives or to burden us with more taxes.

I know there are people who will read this and say "your no expert." That is entirely true, but you don't have to look to far to see what the experts are saying about coming inflation. The July issue of Smart Money magazine has an interesting article entitled "Stocks That Beat Inflation." In it, they quote George Schwartz, head of the Ave Maria Catholic Values fund, as saying, "You can't run the printing press and spend like drunken sailors without consequences." They also say in the article, "a small but growing number of investment pros are betting inflation will return much faster than the conventional wisdom anticipates, and when it does, it will be far more widespread and potent than we've seen in years."

Lastly, when Roosevelt's administration passed legislation, similar to the current administration, it did not end the Great Depression. The economy never fully recovered from the depression until World War II. So if it didn't work then, why should we expect it to work now.