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:

http://www.annualcreditreport.com/

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.

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!


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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.

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.

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.

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.