Hedging your bets

Despite negative markets in June, hedge funds were able to attract new assets, with an estimated $5.6 billion flowing into the space during the month.

Oliver Schupp, President of Credit Suisse Index Co., LLC, said, "The Dow Jones Credit Suisse Hedge Fund Index fell 1.36% in June, with eight out of ten sectors posting negative performance for the month. Managed Futures continued to experience trading losses, falling -3.07%. Conversely, the Dedicated Short Bias strategy, which includes funds aiming to capitalize on deteriorating stock prices, was the best performing sector for the month, finishing up 1.57%." 

Schupp continued, "Despite overall negative performance, the industry continued to see inflows with an estimated $5.6 billion in assets entering the space in June. New inflows now total $33.3 billion year-to-date. We currently estimate overall industry assets have fallen to $1.81 trillion."

Performance for the Broad Index and its ten sub-strategies is calculated monthly. June, May and YTD performance numbers are  are available at www.hedgeindex.com.

Those with sizable assets worried about deficit

A new study by TNS, the world's largest custom research firm, reveals that 87% of Americans with $500,000 or more in investable assets agree that the size of the US government's deficit is a major concern for them.

Of those surveyed, 40% stated that they would be willing to pay higher taxes if it meant there were no changes to Social Security and Medicare. Forty percent also agreed that in order to balance the federal budget, they would be willing to accept changes to both Social Security and Medicare.

Across the board there is concern and uncertainty around the U.S. economy and how it will affect the financial well-being of Americans.

43% feel the current state of the economy will jeopardize their retirement plans
40% plan to reduce the amount of money they spend compared to last year

Anxiety about the financial health of the U.S. government is also evident, with:

56% agreeing that they are concerned that the US government may default on its debt obligations
60% stating they do not think the US government should increase the federal debt ceiling

TNS also released its latest Investor Confidence Index, which declined in June to 102, its lowest level in a year. This 11 point drop is being driven by growing pessimism about the stock market and the direction of the economy.

"These findings reveal significant stress and discomfort among investors who control the overwhelming majority of the personal wealth in the U.S. We expect investor confidence to decline further if a decision concerning the debt ceiling isn't made ahead of the August 2nd deadline. On the other hand, a satisfactory resolution could raise investor confidence and spur a rise in the financial markets," said Joe Hagan, SVP at TNS.

The survey is part of TNS' Affluent Market Research Program.

Fannie Mae December report released

Fannie Mae's (OTC Bulletin Board: FNMA) December 2010 Monthly Summary is now available at www.fanniemae.com/ir/monthly.  The monthly summary report contains information about Fannie Mae's monthly and year-to-date activities for our gross mortgage portfolio, mortgage-backed securities and other guarantees, interest rate risk measures, and serious delinquency rates.

Fannie Mae exists to expand affordable housing and bring global capital to local communities in order to serve the U.S. housing market. Fannie Mae has a federal charter and operates in America's secondary mortgage market to enhance the liquidity of the mortgage market by providing funds to mortgage bankers and other lenders so that they may lend to home buyers.  Our job is to help those who house America.

Gold market still holds interest

Not long ago when Gold Bullion was at it's highest price, everyone was talking about gold and other precious metals as an investment strategy. While some of the discussion has cooled just a bit, there are still many investment experts that advise their clients to buy Gold.

While some argue the fiat money system, others opt for Bullion as a hedge should there be any kind of a market failure. It's fairly well established that should some type of a major financial crisis hit that gold and other precious metals could play a role in keeping your financial status stable.

There are also other products out there like the Gold IRA. As your financial planner about it and do your research on the number of companies out there, like Regalgoldcoins.com that specialize in precious metals. The chart below shows you the prices of gold:

Gold Price

Decline in mortgage defaults reported

Data through December 2010, released today by Standard & Poor's and Experian for the S&P/Experian Consumer Credit Default Indices, a comprehensive measure of changes in consumer credit defaults, showed a decline in monthly default rates for first and second mortgages to 2.93% and 1.74% respectively. Auto loans experienced the biggest decline this month to 1.68% from 1.76% in November. The bank card index declined slightly to 6.73% default rate.

"Default rates across the four major categories of consumer borrowing declined in December from November and from a year earlier. Nationally, consumers continue to gradually improve their financial condition," commented David M. Blitzer, Managing Director and Chairman of the Index Committee for S&P. "Separately, data from the Federal Reserve shows that bank card credit declined through November. Debt-service ratios, the proportion of disposable income that goes to paying debt, continues to decline. On a regional basis, the five cities we cover suggest that the Sunbelt continues to see greater than typical default rates."

Consolidate debt don't ignore it

If bills are piling up and creditors are calling, ignoring them won't make them go away or help your credit. Bankruptcy may sound tempting but that doesn't rebuild your credit. Debt consolidation can sometimes be the answer -- websites like http://www.anewhorizon.org are worth visiting.

Americans are buried in thousands of dollars of credit card debt, so don't feel as if you are alone. It's better to go with a service that is established and has a proven track record, read the fine print and ask questions. Reputable companies will have no problem with questions, they'll be happy to answer them for you.

There are no magic cures for credit problems. Though debt consolidation can get you on the road to credit recovery.

Retirement tips

Increasingly, Americans are entering the age of retirement without enough savings to do so comfortably. However, it is never too late to focus on life stage retirement planning to make the golden years glisten much more. Here are tips to do so.

• Saving should be a top priority. Some people may have procrastinated while others hit some bumps in the road. Either way, the closer a person gets to retiring, the less working years they have and less time to save. One should look at finances, consider needs and wants, and reprioritize.
• Delay retiring, especially if you started saving late in life. This is beneficially for Social Security and health insurance purposes. Social Security income is adjusted for inflation, tax efficient and guaranteed by the federal government. Every month a worker is able to put money toward this benefit, up to the age of 70, the more savings will accumulate. If an employer-sponsored health care plan is superior, depending on their situation, one can save a great deal. When retirement planning, people often forget that Medicare does not cover every needed item, which can be very expensive.
• Reconsider investments. Whether to invest aggressively or conservatively is a tough decision at any age, but especially for someone who is creating a financial plan later in life. One may invest aggressively to make up for lost time while another may shy away from risk because they don't want to lose what little they have saved. Risky speculation and eroding inflation are heavy considerations. The sound advice from a professional in the retirement planning field should be considered to make the right calls.
• Take advantage of tax efficient plans. Taxes can quickly chip away at savings. People entering an age to retire should especially consider as many tax efficient plans as possible, such as a 401k, Roth IRA and traditional IRAs.

About RetirementPlanning.net

RetirementPlanning.net offers a free service that connects you with a retirement planning professional who can help ensure a successful retirement. You can gain advice on portfolio management, retirement planning, estate planning, education planning, 401k rollover, and more. Visit the website to get financial advice and start planning your retirement today.

Trick or treat from the Fed?

A follow up article to the earlier one on the proposed action by the Federal Reserve. Newsweek asks the question -- Has the Fed run out of tricks?. It's a recommended read, part of:

What the Fed is expected to authorize in November is a large purchase of U.S. Treasury bonds with the intent of driving down their interest rates, and rates on other long-term debt securities. It has already done this once. In late 2008 the Fed approved massive bond purchases; these ultimately totaled $1.725 trillion of mortgage-backed securities, U.S. Treasury bonds, and Fannie Mae and Freddie Mac bonds. Bernanke has said the program “made an important contribution” to the economic recovery.
But the measurable effects were small. A Fed study estimated that rates on all 10-year bonds might have dropped by 0.6 percentage points. The decline this time might be less, because starting interest rates are already low (about 4.3 percent for a 30-year mortgage) and the purchases might be smaller. Guesses generally range from $500 billion to $1 trillion.
Economists at Bank of America think new purchases would have “only a modest impact on the economy” but are “better than doing nothing.” A plausible program might cut the unemployment rate by 0.2 percentage points (say, from 9.6 percent to 9.4 percent), says Moody’s Analytics. The stock market would be slightly stronger, leading people to spend more, and a depreciated dollar would aid exports. Indeed, because Bernanke and other Fed officials have signaled a new round of bond buying, financial markets may already reflect some of these effects.

You can bank on it

Ever wanted to look at banking careers? There are actually classes you can take that will increase your chances of catching the interest of a bank as far as hiring you as a full time bank employee. Classes that are offered go beyond being a bank teller, they also provide additional learning for those interested in loans or any of the other services that banks offer. Most of the classes don't require a long term educational commitment...

Fed to take more action...

The Federal Reserve chairman, Ben S. Bernanke, went further on Friday in outlining the risks the central bank was prepared to take by pumping more money into the flagging recovery.

The new action would be aimed at lowering interest rates and spurring growth, but it would most likely have effects far beyond American shores. It could contribute to the weakening of the dollar and complicate a festering currency dispute that threatens to disrupt global trade relations.

For Americans, additional Fed activity is likely to mean that already low 30-year mortgage rates would fall even further. The moves would not help many savers, however, as yields on certificates of deposit and savings bonds would probably fall as well. But the Fed hopes that making credit even cheaper will encourage businesses and consumers to borrow and spend, and that could eventually bring relief to jobless workers.

Mr. Bernanke’s remarks, at a conference organized by the Federal Reserve Bank of Boston, confirmed Wall Street analysts’ expectations that the Federal Open Market Committee would approve new steps at its next meeting on Nov. 2-3.

Things you can fix...

Many of us are into fixing whatever we can by ourselves when possible to save money. There are all kinds of do it yourself tips and hints out there on the internet from home to car repair. Something else that you can at times fix yourself, with some help and guidance from experts is Credit Repair.

The first step is research. The Best Credit Repair Service for your particular situation is most likely out there. Read the fine print as far as what the costs are, many times there is no cost but don't assume just because the services are free that they are the best ones for you.

Carefully read what each Credit Repair company offers. Depending on how "bad" your credit is, you may be able to take advantage of their tips and negotiate on your own. There are times however, when you could benefit from a professional's experience. In some states your credit history can even impact your ability to get a job. Recently in Ohio legislation was presented to prevent employers from using credit reports to determine someone's worthiness as a future employee if their position was not one that dealt with certain fields. That's months if not years away from passing...

Lehman Brothers artwork for sale

The whole saga related to the Lehman Brothers is one that's gained focus in Ohio with the gubernatorial election involving a former employee, John Kasich. So it was interesting to see CNN and several other media sources cover the auction of art work that used to adorn some of the Lehman Brother's offices.

London, England (CNN) -- Artwork that used to adorn the walls and halls of Lehman Brothers' offices in London is expected to fetch £2 million ($3.1 million) when it goes up for auction Wednesday.
Christie's auction house in London is selling the art, which includes works by Lucian Freud and Anthony Gormley, antique maps and surveys, Chinese ceramics, and even Lehman Brothers' signs.
A separate sale of Lehman Brothers' artwork from their North American offices, due to take place at Sotheby's in New York on Sunday, was estimated to bring more than $10 million, according to the auction house.
Lehman Brothers filed for bankruptcy in the United States two years ago after a nearly $4 billion loss, the failure of buyout negotiations with Bank of America and Barclays Capital, and the refusal of U.S. regulators to offer a government-backed bailout.
At the same time, Lehman in the United Kingdom went into liquidation, with administrators PricewaterhouseCoopers (PWC) appointed to sell off the assets.

The full article.

Your own personal Wall Street...

As we've often focused, you can do almost anything online that used to take phone calls or a trip to an office. Take online trading as an example, it used to be that you'd have to go down to a broker's office to open an account if you were interested in stock trading and then call that broker when you wanted to buy or sell something.

Now, you can use an online broker and even set up your account online. You have the power to control your own account instantly, with no hours of operation, only how much time you want to spend and when you want to spend it. You can even do mobile trading depending on the type of cell phone service you have. With online banking and other financial options, you can even handle your IRA accounts from your home or work computer.

Those of you who want the traditional services still can access them, however, those of you who want to harness the power of the internet? Have that choice.

Basel Committee on Banking Supervision being watched

The Basel Committee on Banking Supervision provides a forum for regular cooperation on banking supervisory matters. Its objective is to enhance understanding of key supervisory issues and improve the quality of banking supervision worldwide. It seeks to do so by exchanging information on national supervisory issues, approaches and techniques, with a view to promoting common understanding. At times, the Committee uses this common understanding to develop guidelines and supervisory standards in areas where they are considered desirable. In this regard, the Committee is best known for its international standards on capital adequacy; the Core Principles for Effective Banking Supervision; and the Concordat on cross-border banking supervision.

The Committee's members come from Argentina, Australia, Belgium, Brazil, Canada, China, France, Germany, Hong Kong SAR, India, Indonesia, Italy, Japan, Korea, Luxembourg, Mexico, the Netherlands, Russia, Saudi Arabia, Singapore, South Africa, Spain, Sweden, Switzerland, Turkey, the United Kingdom and the United States. The present Chairman of the Committee is Mr Nout Wellink, President of the Netherlands Bank.

The Committee encourages contacts and cooperation among its members and other banking supervisory authorities. It circulates to supervisors throughout the world both published and unpublished papers providing guidance on banking supervisory matters. Contacts have been further strengthened by an International Conference of Banking Supervisors (ICBS) which takes place every two years.

The Committee's Secretariat is located at the Bank for International Settlements in Basel, Switzerland, and is staffed mainly by professional supervisors on temporary secondment from member institutions. In addition to undertaking the secretarial work for the Committee and its many expert sub-committees, it stands ready to give advice to supervisory authorities in all countries. Mr Stefan Walter is the Secretary General of the Basel Committee.

Read more about them here

$324 million in back pay unclaimed

If you know someone who might have been impacted this story as reported in the Washington Post -- you'd be doing them a huge favor by pointing it out:

Last October, Congress approved retroactive bonus pay for military personnel who were forced to remain on duty beyond their original discharge date, a controversial policy known as "stop-loss." Lawmakers approved back pay of $500 for each month of involuntary service; the average lump-sum due is between $3,500 and $3,800.

To get the cash, an application must be submitted by Oct. 21; only about a third of those eligible have handed in paperwork. With just six weeks remaining before the deadline, the Department of Defense is scrambling to track down about 90,000 veterans, as well as some active-duty troops, to ask them to apply for their back pay.

The military has mailed letters to those who are eligible and mounted an extensive publicity campaign, but the message isn't sinking in. More than 80 percent of those entitled to the bonuses are Army veterans.

Fewer young people paying for the old people.

The basis of what the real problem is with Social Security -- in Newsweek:

Which brings us to Social Security's financial "crisis." The issue isn't that Social Security is spending too much or that we're living too long. It's that we're not having enough children (or letting in enough immigrants). As Stephen C. Goss, the system's chief actuary, has written, Social Security projects an imbalance "because birth rates dropped from three to two children per woman." That means there are fewer young people paying for the old people. "Importantly," Goss continues, "this shortfall is basically stable after 2035." In other words, we only have to fix Social Security once.

Fix your credit, don't walk away from it...

It's tempting to file bankruptcy, there are lots of advertising out there that promises you that you can get a fresh start. While bankruptcy does make your old debts go away, the record remains. There are of course some situations where your credit can't be saved, but many times it's possible -- sites like thecreditpeople.com are designed to help you get back on track.

Not all credit repair services are the same, while it is possible to Improve & Fix your Credit Score companies that want to charge you hundreds of dollars and make promises that they can do this within minutes, should make you pause. While it is faster many times to correct your credit score in comparison to how long it took you to get into debt, it's not instant. It is helpful for most consumers to have a company assist them rather than to try to fight the credit reporting bureaus on their own. That experience is the key advantage to using a credit repair firm...

The Hindenburg Omen

I read about this today in the Toledo Free Press - Four ways to avoid the ‘Hindenburg Omen’. I started searching for a bit more information on the "Omen" -- Also recently written about in the Wall Street Journal:

The Dow is down 3.2% since the Omen was first triggered on Aug. 12. As avid Marketbeat readers know, the indicator’s creator Jim Miekka is looking for a 20% drop by approximately the end of September, so time will tell if his “omen” will come to fruition.

As reported in today’s Journal, the 50-year-old Miekka, blind former physics teacher, who is also an avid target shooter, might be the least likely person Wall Street would pay attention to, but he’s definitely on the radar these days as investors desperately look for any pointers on the direction of the stock market. Miekka splits his time living in remote parts of Maine and Florida, far from the concrete canyons of Manhattan, and publishes an obscure investing newsletter — the Sudbury Bull & Bear Report — that you’ve probably never heard of.

It's also been the focus of many other news reports, including this earlier piece from August 17 - What Exactly is the Hindenburg Omen:

But wait: Mad Money viewers know that Cramer views technical analysis as, for the most part, nothing more than divination. It’s a voodoo of sorts, by which technicians study past patterns in stock movements to predict where those stocks will go next. The only reason Cramer ever defers to the charts is because money managers often consult them. And because these large institutional players literally set market prices, it’s important to know what they are thinking at any given time.

Worldwide military spending increased in 2009 by its fastest pace in 6 years

We think of things being more peaceful in the world when it comes to needing military. Evidently that's not the case with this Christian Science Monitor article pointing out that worldwide spending on military has increased more last year than any year in the past six years. It is the oil nations that increased the most, (article link).

The US remains by far the biggest military spender, followed by China, the Stockholm International Peace Research Institute (SIPRI) said in its annual report on worldwide military expenditures, released June 2. Last year saw the steepest jump in worldwide military spending since the start of the Iraq War in 2003.

But, as the world’s military spending increased nearly 50 percent over the past decade, the biggest military budget increases were seen in small, oil-rich countries flooded with new wealth.

From 2000 to 2009, Chad increased its military budget 663 percent, Azerbaijan increased 471 percent, and Kazakhstan increased 360 percent.

Stock sell off continues related to Greek crisis

From CNN:

The selloff resumed Friday as investors remained jittery following one of the most gut-churning days in Wall Street history.

The Dow Jones industrial average (INDU) lost 217 points, or 2%, after having been on both sides of the breakeven point in the first 30 minutes of the session. The S&P 500 index (SPX) lost 25 points, or 2.3%. The Nasdaq composite (COMP) lost 73 points, or 3%.