Category Archives: personal finance

Suze Update

I’ve been blogging for a good seven years now, and I’ve never — not even close — received anything like the amount of positive feedback that I got today for my blog entry on Suze Orman. I clearly touched a … Continue reading

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In Praise of Suze Orman

The kind of people who read Portfolio.com — or, for that matter, The Big Money — are not Suze Orman’s target audience. You, dear reader, are likely an urban sophisticate; you’re probably male; there’s a very good chance you work … Continue reading

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Is Buying Bonds Really a Good Idea?

The WSJ’s Brett Arends has learned his lessons this year, and shares them with us, including these ones: 4. Invest more, not less. Is that a guffaw from the peanut gallery? I don’t blame you. Your savings just fell 40% … Continue reading

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Adam Levitin on Credit Card Minimum Payments

In behavioral economics, "anchoring" is a well-known phenomenon, and so it’s not surprising that when people get credit-card statements, the lower the minimum payment, the less they’re likely to pay. According to the Economist, the minimum-payment boxes are actually a … Continue reading

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The Admirable Suze Orman

I was recently flattered to be on a list of media winners from the credit crisis. But arguably the biggest winner of all wasn’t on the list: Suze Orman, who’s the subject of a mildly skeptical article in today’s WSJ. … Continue reading

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Credit Cards: Not Dead Yet

Dan Gross has a piece in Slate entitled "The Death of the Credit Card Economy". It tells a plausible and compelling story: as credit-card companies slash credit lines, so are consumers cutting back on their spending. Gross quotes Dan Ariely … Continue reading

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0% is Not a Useful Stock Fund Benchmark

Barry Ritholtz says it’s "amazing" that out of 2,100 diversified retail U.S. stock mutual funds open to new investors, just 17 have positive returns for both the past 12 months and year-to-date. The factoid comes, depressingly enough, from a very … Continue reading

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What’s an Easy Way to Buy Cheap Assets?

It’s much, much bigger than regional banks buying GSE preferreds. You can buy Fannie and Freddie senior debt at significant spreads over the government which is guaranteeing it; hell, you can write credit protection on the US government and make … Continue reading

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When Op-Ed Pages Turn Neutral

The Christian Science Monitor has a classic example of "Opinions on Shape of Earth Differ" syndrome. It runs a first-rate op-ed by Mark Lange on the invidious and predatory behavior of credit-card companies. It then, however, neutralizes Lange’s piece by … Continue reading

Posted in Media, personal finance | 4 Comments

A Brief History of Home Equity Loans

Louise Story has an excellent history of the home equity loan on the front page of today’s NYT. She talks a lot about the explosion in such products — outstandings rose a thousandfold, to $1 trillion, from the early 1980s … Continue reading

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Learning Lessons from Auction Rate Securities

Back in February, James Stewart, an investor in auction-rate preferred shares, complained that those shares were illiquid and that he was having difficulty accessing his money. He reckoned that if he couldn’t get his money out of the closed-end fund … Continue reading

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Keeping Your Eggs in Many FDIC-Insured Baskets

The Grouse is hearing portentious rumblings: I am told that a loan trader at one investment bank is all in cash and has his wife running around opening savings accounts at various banks so that his money will be covered … Continue reading

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Should You Tap Your Heloc Before it’s Frozen?

The home equity line of credit, or Heloc, is a wonderful thing: the best way of having liquid funds available in case of emergency you could possibly imagine. Your net worth might be tied up in your house, but that … Continue reading

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Retirement: Not as Important as a Dishwasher

Heather Havrilesky has an important piece in Salon about online retirement calculators, and she ultimately ends up in exactly the right place, albeit with a very low level of confidence. The right place, in case you hadn’t worked it out … Continue reading

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Meredith Whitney and the Hierarchy of Payments

It used to be that if you were having difficulty making your mortgage payment, you’d end up, one way or another, putting it on your credit card — if only by being unable to pay off much of your credit … Continue reading

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More Savings Advice for Twentysomethings

Bryan Keller has just written a very astute email taking issue with my retirement advice for twentysomethings, and asks if it doesn’t contradict slightly the points I made when I was promoting financial wellness. Keller says that financial wellness is … Continue reading

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Retirement Advice for Twentysomethings

A reader writes: As a "younger investor" myself looking for ways to retire with millions (we can all dream), I’ve been trying to start early and doing my research to figure out ways to gain an advantage in the long … Continue reading

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John McCain’s Credit Card Problems

Is John McCain paying 26% interest on his credit card? Dan Ray seems to think so: McCain reported he [and his wife were] paying 25.99 percent on their joint credit card, on which they owed somewhere between $10,001 and $15,000. … Continue reading

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Why Young Savers Should Borrow Money to Invest in Stocks

Many thanks to an anonymous commenter on my last blog for pointing me to a very provocative piece of research from Ian Ayres and Barry Nalebuff, entitled "Life-Cycle Investing and Leverage: Buying Stock on Margin Can Reduce Retirement Risk". They … Continue reading

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The ETF-Squared: It Reallocates For You

Remember Ron Lieber’s catchy little slogan? "Index (mostly). Save a ton. Reallocate infrequently." Turns out, here’s a new ETF out there which doesn’t just do the indexing for you, it does the reallocation as well. To be precise, there are … Continue reading

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Check Forgery Datapoint of the Day

Luke Mullins talks to Frank Abagnale, the acknowledged expert on such matters: Check forgery is now at about $20 billion a year, up from about $12.6 billion in 1996. There was an increase in check forgery of over 25 percent … Continue reading

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Why Cap-Weighted Funds Aren’t for Everyone

Joe Nocera finds himself enmeshed this week in a rather arcane fight within the world of index funds: the one between cap-weighted funds, on the one hand, and fundamentally-weighted funds, on the other. Nocera ultimately dodges the question – "they’ve … Continue reading

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The New Realities of Personal Finance

Ron Lieber, Cubs fan and new personal-finance columnist for the NYT, has hit a home run with his first at-bat: "Five Basics for Building a Solid Financial Future" is top of nytimes.com’s Most Emailed list, not just for the Business … Continue reading

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A Sensible Way of Buying Fixed-Income Risk

In a world where the Charles Schwab YieldPlus fund has fallen more than 25% this year alone, statements that bond funds just aren’t risky enough are likely to be met with a hollow laugh from some quarters. But it’s true: … Continue reading

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JetBlue Pushes PayPal Option

As we saw with Frontier, airlines are at risk not only from high jet fuel prices but also from their credit card companies, who have the right to unilaterally hold back a very large percentage of any airline’s cashflow. I’m … Continue reading

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