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Latest Developments in the Economy (financial business coach)

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By Barton Simmons

 Many of the jobs in President Bush’s “recovery” are low-wage, low-benefit service and retail jobs. The overall growth in jobs masks a harsher reality for families trying to maintain or build a middle class standard of living.

Key among them: debt coupled with paycheck paralysis.

Most people coming out of college with or without a degree are starting life off with about $20,000 in debt trying to get a degree.

Then they try to support themselves on low wages after getting out of school.

A generation ago finishing high school was what was needed to get a job and to have a reasonable amount of security.

Now what is needed is a university degree and not just any degree, look at all people working in low class jobs with an arts degree.

In the last 30 years compensation for somebody with a university degree has actually decreased when adjusted for inflation.

Personal bankruptcy filings nationwide last year exceeded 2 million, the highest annual level on record.

There were significant increases in consumer bankruptcy filings in every region. The total of 2,043,535 was up 32 percent over the 1,552,967 filed in 2004. That translates to one in every 53 households filing bankruptcy petitions.

So are these 2 million people Scofflaws?

Credit counselors say the debtors coming to their offices can’t afford to pay basic living expenses or make even minimal payments toward their debts.

Corporate profits have reached record highs.

People are working longer for the same or a lesser amount of money.

During the period from November 2003 to March 2004 - when job growth was increasing - average hourly real wages actually fell by 1 percent.

Companies are reducing health care benefits and are declaring bankruptcy to get rid of pension liabilities to their employees.

Yes, but there are Tax Cuts.

Tax Cuts have to be paid for by somebody at some point in time.

If the tax cuts were financed largely or entirely through spending cuts or: if the tax cuts were financed through a combination of spending cuts and progressive tax increases this is what is projected by experts:

The net result seems to be net tax cuts for about 20-25 percent of households, financed by net tax increases or benefit reductions for the remaining 75-80 percent of the population.

So 75% to 80 % of Taxpayers are going to be worse off with tax cuts.

The “losers” are going to be low- and middle-income wage earners.

The trade deficit for last year is estimated to have swollen to another record high, above $700 billion, increasing America’s indebtedness to foreigners.

At some point in time these foreigners are going to want their money back.

Then what?

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Car Finance - A Small Rant And A Plate Of Biscuits

By William Penworthy

 A friend of mine was recently moaning about car finance. He’s been moaning quite a bit lately, but then I suppose he has a fair bit to be a bit dismal about. Car finance is his latest grudge, and as I have got to know him quite well over the years, I let him vent for a while.

The problem, he was explaining carefully to me, was that the banks, the financial institutions and the companies who hold the purse strings to credit and financial freedom, don’t understand money.

This was perhaps a slightly dramatic statement to make, and he understood that such a statement clearly needed a little backing up, so he continued.

It seems that he had gone to his bank for a car loan. He wanted to buy a car - no, that’s not right - he needed to buy a car. His old one died several years ago - it just hasn’t stopped moving yet. The rear doors no longer open, so passengers have to either climb over the front seats, or crawl through the boot. Lucky for him it’s a hatchback or he may have had to resort to cutting an escape hatch in the roof.

The suspension is so bad that if he buys milk from the supermarket it’s turned to butter by the time he gets home, and he’s discovered that buying eggs is simply a waste of time. The steering isn’t great either. It’s okay as long as he keeps turning left, but for some reason the car makes an appalling noise in a mechanical argument should he ever have the temerity to turn right.

To get from one side of town to the other he has devised a very cunning route that’s actually a very scenic spiral. As long as he’s never in a hurry.

So it was clearly apparent that he needed car finance or a car loan to replace his worn out lump of scrap metal and replace it with something with four wheels and an engine, all of which work together in union rather than making weird noises at each other in disagreement. His bank turned him down.

When he asked why they explained that they carried out a credit check, and his credit rating did not meet with their requirements. He explained to me that this was their way of telling him that they thought he’d run off with their money and never pay it back. Which is unfair really, because he may be many things, but he is at least honest. To a fault sometimes.

Anyway, having been turned down for a car loan by his bank he looked elsewhere for a car finance solution, and decided to go straight to the dealers. Cars on finance, cheap car finance - car loans at low rates, drive away today. It all sounded really good, and he enjoyed spending quite a while browsing the showrooms.

These places are different, he thought, because they see me as a customer, rather than a beggar. He settled on a delightful car, sat down in the office, was handed a steaming mug of tea and a plate of biscuits whilst they handled the paperwork. He applied for car finance, and after a single phone call he was told that he had failed the credit check. The biscuits were taken away and on his way out he admits to deliberately lifting the windscreen wipers up of at least six cars. He was a tad peeved.

But as he explained to me, these companies don’t understand money, because his credit rating is only low because he was made redundant a year ago. That’s history now though - credit history. His problems are behind him and he now has disposable income - why can’t the financial institutions see that?

After much sympathising and making cups of tea, I suggested he try a company I’d dealt with who offer guaranteed car finance. His reaction was swift - he wouldn’t deal with guaranteed car finance because the rates are high, and they only let you spend it on one of their own cars from their own very limited range.

Not this company, I explained. They offer guaranteed car finance for people with bad credit ratings because they check your current circumstances, rather than what happened in the past, they offer cheap car finance rates, and they’ll let you use the car loan to buy any car you like, from any dealer you like, anywhere in the UK. After a few mumbles and another couple of biscuits he sauntered off. A week later he picked me up in his new car, praising the car finance industry for their ability to understand money so well.

Car Finance http://www.carloan4u.co.uk/ Guaranteed Car Finance

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Wednesday, March 10th, 2010 at 7:40 am and is filed under finance. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.