Archive for October 2nd, 2009

6 Financial Moves That Sound Good — but Aren’t
by Erin Joyce
Thursday, October 1, 2009

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For most people, each and every day involves some type of financial decision. So how do you feel about your financial decision-making skills? If you think you are making sound choices, ask yourself this: Have you weighed the consequences of your choices against their apparent benefits? In many cases, the answer is no.

Let’s take a look at six common financial choices that sound like smart moves, but could leave you scratching your head wondering where you went wrong.

1. Applying for a Line of Credit
Advantages: Starting a line of credit will diversify your credit sources, which is good news for your credit score. It also allows you to access funds you may need for large purchases, like buying a car, without having to scramble to arrange the funds when you decide to buy.

Consequences: A line of credit is too often treated like free money. In many cases, such easy access to funds leads borrowers to rack up consumer debt for things they don’t really need. And there’s nothing free about this cash injection: borrowers have to make minimum payments on the line’s outstanding balance. In addition, a balance will limit borrowing power on other loans, such as a mortgage.

2. Withdrawing From Your 401(k) or Retirement Savings to Pay Down Debt
Advantages: If you have a big debt to pay off, you may choose to either put off contributing to a retirement or savings fund, or to withdraw money from an existing fund. The upside to this is that paying down debt is a good thing, and the sooner it is paid off, the greater the savings in interest expenses for the borrower.

Consequences: By withdrawing funds set aside for retirement, you are robbing yourself of the benefits of compounding. Also, pulling the money out of your savings could leave you in a very bad position should something unexpected, like a job loss, happen. The earlier you start saving, the more money you will be able to accumulate for retirement. If properly invested, money saved now is almost always better than more money saved later.
3. Choosing Only the Safest Investing Vehicles
Advantages: If you invest in risk-free or nearly risk-free vehicles, the risk of losing your hard-earned cash is extremely low. This can be a viable option, especially if you are nearing retirement.

Downside: However, you are again missing out on the opportunity to have your money work for you. Take into consideration your age and stage of life when deciding your risk level. Although everyone’s risk tolerance is different, generally speaking, the younger you are, the riskier you can afford to be. This is because you have the time to make up any losses, and also because the higher risk may be warranted because it helps combat the effects of inflation on your portfolio’s gains. The closer you are to retirement (or to whatever goal you are saving for) the more conservative you should be in order to protect your investment.
4. Avoiding Debt Altogether
Advantages: “Debt free”. It sounds good, doesn’t it? And it can be. Living debt-free is a wonderful goal and is more achievable than you might think.

Downside: However, debt can also be a tool. If, in your quest to remain debt free, you are turning down “good debt”, that is, debt that allows you to leverage your investments, you are doing yourself a disservice. Examples of good debt include taking out a mortgage to buy a house. This is because houses and property tend to appreciate over time, and owning your home can lower your living expenses compared to renting. Another example would be taking out a student loan for post-secondary education. While student debt can be a huge responsibility, it is also an investment in yourself that boosts your potential earning power.

5. Cutting Your Variable Spending
Advantages: If you are looking to cut your spending, this suggests that you have a budget to modify. That’s great! Often variable expenses (expenses that are not fixed, such as entertainment, dining out and personal spending) are out of line with the amount we earn. An honest appraisal of where your money is going is a great step to getting your budget in fighting shape.

Downside: This seemingly great idea is only great if you include the second part of it: sticking to your new budget. Unrealistic expectations, or treating your budget goals as “guidelines” rather than rules, could leave you spending more than ever. (For more tips, see Get Emotional Spending Under Control.)

6. Paying Off a Major Loan in One Payment
Advantages: You’ve been working hard and saving – smart! Before your loans start accumulating interest, or even if they have, you decide to pay them off in one payment. That’s a wonderful accomplishment that will save you months’, or years’ worth of interest.

Downside: If you choose this route, make sure you take a look at your interest rate. Some loans have such a low interest rate that you’d be better off putting your money in a savings account that earns you a higher return and paying off your debt monthly. Keep in mind this is only a good idea if 1) your savings interest rate is higher than your debt interest rate and 2) you are disciplined enough to pay the debt off on time, every month, and not to spend your hard-earned cash on luxuries instead. The bonus? Responsibly paying off monthly debt helps you to establish a good credit history. This is especially helpful if you don’t have a credit history (or you are trying to rebuild a bad one).
There’s nothing worse than making a choice you thought was conscientious only to find out it had hidden consequences. Make sure you do your homework and your financial situation will be the best it can be.


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Sufficient II

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A Primer on Economic Inequality

I am Poor Joe. See my neighbor Mr.Fat  Cat.

We both are equal before Law. Isn’t that great thing about living in a free consumer society? we both are free to make money as we please.

Only that his credit is good and his million dollar home still looks grand whereas mine is foreclosed.

Recession made his personal worth drop a billion but he has still billions coming from his offshore accounts and from ends of the earth, which at the push of a button he can keep moving around. Whereas I walk from pillar to post for a handout.

We both are equal before Law. isn’t that a great thing I can go where and whenever I want?

Only that Mr. Fat Cat take his jet and I can only walk four blocks away?

Mr. Fat Cat write off his expenses while I must count nickels and dimes. He can twiddle his thumb all day and at the end of the day his interest adds up a tidy sum.  Only that I wear out my soles at the end of the day.

I look for jobs any position that are far below my qualifications.But I draw blank. Now that I have developed a permanent scowl and a hangman’s look from having nothing to do, I am in the sights of the law.  I cannot even make past the entrance gate before the law tells me to scram,’Shoo!’.

So being denied a position commensurate with my worth takes away even the basic stamp of humanity. Is this what means to be as equal with Mr.Fat Cat?


The other day Mr. Fat Cat made news. he was really none other than Bernard Madoff. I am still Poor Joe with no roof over my head. Mr. fat Cat is still lucky. He has a roof over his head and three square meals. All at Government expense.

Whereas I am still Poor Joe, living in a discarded mover’s box. I am not going any place. Why I am equal before law as the highest of the realm. Isn’t it a great thing?.


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(This is a reprint of the post first posted in cinebuff.wordpress.com)

One feature of Bergman films is an unconscious acknowledgment of personal influences of his world on him. Bergman was working for Svensk Filmindustri while Alf Sjöberg made The Road to Heaven (1942), a stark medieval allegory, hints of which we can see in The Seventh Seal. The fact that he went on to put Miss Julie, the film that established the reputation of Sjöberg on the boards after his death, cannot be coincidental. If Bergman has found relentless use of close-up of the face a technique to reinforce the existential and moral problems of his characters we may find in Carl Dreyer’s use of such close-ups as forerunner. In citing these in no way detracts the artistic excellence of this Swedish filmmaker. Another feature of Bergman’s subject matter is his introspective quality derived of course from his childhood memories, adolescence and personality. The Seventh Seal for example is his search for faith in the absence of a personal God. In a way he repudiates the faith of his fathers and in its place coalesce certain existential sureties from his own a clue of which in his film Persona (1966). “Today I feel that in Persona — and later in Cries and Whispers — I had gone as far as I could go. And that in these two instances when working in total freedom, I touched wordless secrets that only the cinema can discover.” If we consider this film in particular we see it as self-revelatory as to his interior life. Take for example the images of Elizabet Vogler and Alma merging as one. This shot is a follow up of the birth of Elizabet’s son and it is narrated by her nurse. It is a painful memory for the actress and she hates herself and her baby. In merging the two faces of the nurse and the patient, Bergman is merely reliving his own condition. It is the reverse of the son towards his father. What spiritual baggage that he is left holding is anathema considering circumstances of its birth. The child- parent relationship must have been traumatic that it is explored in his movies again and again like a melody that one cannot get rid of. His Autumn Sonata (1978) and Fanny and Alexander (1982) are cases in point. This rather obsessive aspect of Bergman where he would rather get rid of the world and its uses on which politics, commerce and culture gather strength (and by which nations may trade their tawdry goods across,) he would confront his viewer and also himself by deep concerns that his own countrymen found as excesses. Consider ‘Bergman’s tight use of a 1.33:1 frame which often excludes any clear glimpses of the world beyond a face which finds no up, down, left or right in which to direct its gaze’. (The radical intimacy of Bergman-Hamish Ford) I for myself cannot think Bergman could pull off a film like say Ophul’s ‘The earrings of Madame de…’ or Fassbinder’s Lola. His metaphysical make-up is too ingrained in him to let him get into a serious business of commenting on political or social concerns of his day. His first success came with Port of Call (1948). In telling the love story of Gösta a seaman who saves a girl from drowning and keeping her by his side Bergman resorts to rather straightforward narrative. Berit has a terrible past and she would rather risk telling it before she commits herself to Gösta. In resolving their differences and mutual acceptance he touches upon social themes like failed parents sending their daughters to reformatories, the reliance of working class women on back-street abortions. We see him more as a disengaged filmmaker from polemics. I mentioned this film to show Bergman, as he has himself admitted at the time, was heavily influenced by Italian neo-realism. ‘The is most apparent in the stunning location sequences of Port of Call, where the influence of Roberto Rossellini and Vittorio De Sica can be seen in virtually every shot. Some of these sequences have a raw documentary-feel… that is lacking in virtually all of Bergman’s other films’. (James travers-2007) Take a film like Smiles of a Summer Night (1955) where love, marriage and infidelity angle of the film is of a different league than the lighthearted touch of Renoir (The Rules of the Game) for instance. The aging Egermann takes his young wife to the theater to see his former mistress. His directorial touch doesn’t bring out anything new in their three-way confrontation except some heavy observations. The three actresses on stage mock men, love and marriage. One of them says that a woman can do anything she wants to a man as long as she doesn’t hurt his dignity. Bergman won a jury prize at Cannes for the film (1955). His handling of the comedy of romantic entanglements was as different from his Magic Flute or the Silence. With films as disparate as the Magician or So Close to Life he showed that he was not confined to any particular style as his genius to put on what he had thematically chalked out. The subject matter determined the style. It could have come only from his intuitive understanding of various modes and viewpoints of filmmakers of his age. Critical acclaim of his films have waxed and waned. Bergman’s status in late 50’s and in the 90s are light years apart. Ingmar Bergman is not to be judged by films per se but in the way he opened us to appreciate the shared condition of life and film art beyond the fads and polemics. It is purely an internal experience. Elizabet, his character in Persona stopped speaking unable to respond effectively with ‘large catastrophes’ such as Holocaust or Vietnam War. Bergman was also confronted by catastrophes that in his case were private. Luckily for us he responded with films.(Ack: James Travers, Hamish ford, Pedro Blas Gonzalez.)


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