Money Talks

When you steal or lose someone's money, you take a part of their life. ~Rich Dad

Today, there are millions of financial planners and other so-called financial experts who truly believe they're doing the right thing when they recommend the investments they sell. Most financial experts aren't rich people but merely sales people. They have no financial education - only sales training. They sell what they're told to sell. Just ask anyone who has worked for one of these financial sweat shops.

One of the biggest rip offs is the 401(k), a government endorsed Ponzi scheme designed to make mutual fund companies rich.

A major problem arises when more people want their money back than there are people willing to put money in. This is why the 401(k) has such severe penalties for early withdrawal.

The Conspiracy roars on. Those that caused and profited from the financial crisis remain in control. Agents of the Conspiracy, the hundreds of thousands of financial sales people masquerading as financial experts, continue to advise the innocent to invest for the long-term, knowing the rich and powerful are taking the money their trusting but naive clients invest.


All that glitters isn't gold, some of it is wine

(Reuters) - Like gold, top wines are highly prized, represent wealth and are selling near their historical highs.

Prices of the five premier cru Bordeaux -- Chateaux Lafite Rothschild, Haut-Brion, Margaux, Latour and Mouton-Rothschild, and the grand crus of Burgundy, particularly Romanee-Conti, are at or above 2007 levels.

During times of economic stress and worry, buyers look to safe investments and gold is seen as a defensive strategy. It's tangible, has intrinsic value and is a good diversifier ... The same can be said for the top growth Bordeaux and for the same reasons.



China starts trading yuan against Malaysian ringgit

China starts trading yuan against Malaysian ringgit
August 20, 2010 12:14 am TWN, AFP

SHANGHAI -- China began trading the Malaysian ringgit against the Chinese yuan on the domestic foreign exchange market Thursday in the latest step toward making the yuan an international currency.

Beijing has been taking steps including promoting the use of the yuan to settle international trade and forging currency swap agreements in a bid to make the yuan a major global currency.

The central bank said earlier this week it would allow foreign financial institutions that participate in the yuan settlement program to invest their yuan proceeds in China's interbank bond market, giving those receiving yuan as payments an investment channel.



Why are retirees running out of money?

Why are retirees running out of money? Simple. Banks are paying next to zero for their savings. To make matters worse, since the interest payments on savings are so small, retirees are eating into their principle - money they spent their whole life saving - just to make ends meet.

This is one more example of the rich ripping off the poor, in this case the elderly poor. As inflation rises, their savings purchase less and less.

After 1971, the Federal Reserve Bank was allowed to print money. Printing money is the same as ripping off savers because each dollar printed devalues every other dollar in circulation - including your savings. Every dollar printed not only rips off savers but also rips off taxpayers because the interest on every dollar printed is paid for through taxes.

"Deflation is always reversible under a fiat money system." ~comments from Fed Chairman Bernanke on printing dollars. In other words, deflation is far more frightening than inflation. Today, the economy is deflating and the Fed is printing money to reverse it.

"Like gold, U.S. dollars have value only to the extent they are strictly limited in supply. But the US has a technology called a printing press (or, today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at essentially no cost. By increasing the number of U.S. dollars in circulation, or even by credibly threatening to do so, the U.S. government can also reduce the value of the dollar in terms of goods and services [inflation], which is equivalent to raising the prices in dollars of those goods and services." ~ Bernanke explained in a speech how far he'd go to save the economy, a few years ago.

In other words, we're willing to devalue people's savings to save the economy.

The rules of money changed in 1971. Today, we see the tragic results of that change. The tragedy shows up in the lives of people who are not only out of work but in many instances too old to go back to work. The tragedy is the erosion of their life's savings as inflation marches on.


The Budget

You may walk away happy with a small income tax cut, or the fact that cigarette and beer taxes have not gone up. But there is much more to the Budget than just those few ringgit you saved...

* Whatever "goodies" we get, we pay it for in other ways. Those "goodies" are not free money handed out by the government. Those "goodies" are paid for with our tax money! Every Ringgit of "goodies" that we "get" is a Ringgit less for other important things, like healthcare or education, for example.

* Economist, financial analysts, the mass media and the ordinary public have been fixated on the annual Budget deficit staying withing 3-5% of gross domestic product (GDP). Public discussion has focused on the Budget deficit being "manageable" or "prudent" at that level. We ignored two things.

Firstly, while the deficit was steady at 3-5% of GDP, the actual level of government spending was soaring.

Secondly, as total government spending was going up, so was the absolute level of the deficit.

* If the government is running deficits to fund consumption spending by increasing government debt, we are leaving our children a legacy of debt

* The mainstream media and government are happy to keep the focus on "goodies" because it avoids discussion and debate on the really important issues - efficiency and accountability.

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Financial Bombs

Their concern was not for the environment or those suffering the ravages of this disaster. Their concern was for the pensioners who are counting on BP for a secure retirement.

On June 17, London's Daily Mail ran a headline screaming, "Obama Bullies BP into £13.5bn Fund for Oil Spill Victims... but British Pensioners will Pick Up the Bill." The British are angry with Obama for pressuring BP to suspend dividend payments and set aside $20 billion for the cleanup. Obama's strong-arm position has not only affected British pensioners, who own 40% of BP, but American pension funds, who own 39%, as well. In other words, the economic damage of the BP disaster goes far beyond the Gulf. The damage is spreading to pensions, pensioners, and portfolios all around the world.

Canary Wharf's ‘BP' stands for Bomb Production. Canary Wharf is much like AIG, a factory for exotic financial products known as derivatives. The problem is that most people do not know what these murky and mysterious products are -- and that includes the people who make them or buy them. It's why Warren Buffett has called derivatives "financial weapons of mass destruction." That is how powerful they are. During World War II, a ship exploded while loading bombs for transport at Port Chicago, California. The explosion flattened everything for miles. It is said that the ship's anchor, which weighed tons, was found more than six miles away. Derivatives -- financial bombs -- have the same power if they accidently detonate inside a bank's balance sheet.

Military bombs are classified by weight: 500-, 750-, and 1,000-pound bombs. Financial bombs have interesting labels such as CDO (collateralized debt obligations), ABS (asset backed securities), and CDS (credit default swaps). While they sound exotic and sophisticated, when put in everyday language, a CDO is simply debt sold as an asset. And CDS, or swaps, are simply a form of insurance.

While it is commendable that President Obama holds the rich and powerful accountable, I wonder what the price will be.



Home Loans at 2% Interest

Dropping interest rates on home loans to near zero percent rates would be one way the government could print more money and stimulate the economy, but it would damage the lives of millions of honest hard working people as taxes and inflation rose.

In such a low interest rate environments, debtors would be winners, and workers and savers would be losers. It would be a sign that the government is desperate, that printing presses are running, and that our leaders will do anything to save the economy ... including destroy it.

If our leaders become desperate, the fractional reserve could be raised to lets say 1 to 30. This would destroy the value of your savings, but banks could drop interest rates to 2 percent and still make money, especially if they paid savers less than 1 percent for their money.

Every dollar in your pocket is debt, an IOU from your government. This is why you and I need to be smarter and use good debt wisely. If we get into lots of good debt, we'll do our part to save the economy - and make ourselves richer.

Remember this, Japan's bubble burst over twenty years ago. They dropped their interest rates to less than 1 percent, and their economy still hasn't recovered. What if the US drops its interest rates and the economy still doesn't return. What will you do? That's an important question for you to ask yourself today... not tomorrow.


The Growing Divide

Prior to 1974, employers rewarded workers for years of loyalty and hard work with a guaranteed retirement income. They didn’t have to save for retirement. After 1974, workers had to move a portion of their income into managed accounts stuffed with stocks, bonds, and mutual funds, hoping that the market would grow steadily for many years. Because people were not financially intelligent and didn’t understand the financial markets, a whole new industry was created, financial planning.

One reason why those in the middle class are getting poorer is because they’re playing by the old rules of money. They’ve been taught to go to school, get a good job, and save for retirement in a well-diversified portfolio of stocks, bonds, and mutual funds. Meanwhile, the rich play by the new rules of money and get rich off those stuck trying to play the retirement game in the old system.

it’s pointless to fight the system because the banks and the ultra-rich are in control and know how to manipulate the system to their advantage.


We were scammed out of our own homes and the propaganda machine was put into overdrive so that everybody started blaming the "guy next door" instead of where it actually belonged. The smoke-n-mirror effect worked because everyone took their eyes off the true culprit... the root of the cause. The average person just focused on the effects, the symptoms & not the cause.


Insight into Decision Making

A group of children were playing near two railway tracks, one still in use while the other disused. Only one child played on the disused track, the rest on the operational track.

The train is coming, and you are just beside the track interchange. You can make the train change its course to the disused track and save most of the kids. However, that would also mean the lone child playing by the disused track would be sacrificed. Or would you rather let the train go its way?

Let's take a pause to think what kind of decision we could make........ ...........

Most people might choose to divert the course of the train, and sacrifice only one child. You might think the same way, I guess. Exactly, to save most of the children at the expense of only one child was rational decision most people would make, morally and emotionally. But, have you ever thought that the child choosing to play on the disused track had in fact made the right decision to play at a safe place?

Nevertheless, he had to be sacrificed because of his ignorant friends who chose to play where the danger was.. This kind of dilemma happens around us everyday. In the office, community, in politics and especially in a democratic society, the minority is often sacrificed for the interest of the majority, no matter how foolish or ignorant the majority are, and how farsighted and knowledgeable the minority are. The child who chose not to play with the rest on the operational track was sidelined. And in the case he was sacrificed, no one would shed a tear for him.

The great critic Leo Velski Julian who told the story said he would not try to change the course of the train because he believed that the kids playing on the operational track should have known very well that track was still in use, and that they should have run away if they heard the train's sirens.. If the train was diverted, that lone child would definitely die because he never thought the train could come over to that track! Moreover, that track was not in use probably because it was not safe. If the train was diverted to the track, we could put the lives of all passengers on board at stake! And in your attempt to save a few kids by sacrificing one child, you might end up sacrificing hundreds of people to save these few kids.

While we are all aware that life is full of tough decisions that need to be made, we may not realize that hasty decisions may not always be the right one.

Remember that what's right isn't always popular... & what's popular isn't always right


Don't Fight the System

"The thing went from what is best to what could be passed," he says. My translation: You can't fight the system.

Don't Fight the System

Volcker knows all too well that the Conspiracy is in control. In the end, it's not the government that has the power. It's the Fed and the ultra-rich banks. This latest financial reform bill is simply a way to pacify the voters and make the government look like it's doing something. The fundamental problems that caused the crisis are still in place—and the people responsible are still in power. The boom and bust cycle will continue as it always has since Nixon took the dollar of the gold standard in 1971.

you need to learn to play by the rules of the rich—The 8 New Rules of Money. You cannot expect the government to bail you out. They only do that for powerful banks and corporations—and they use your money to do it. Counting on the government and regulation to save you and the country sets you up for disappointment and failure.

Only by educating yourself about money and taking control of your financial future by playing by the New Rules of Money will you be able to prosper. The game is always tilted in favor of the rich and powerful. But you can choose to opt out of the old rules and prosper by understanding how the world and money works, just like the rich do.



Ideal Market Niche

Philip Kotler: An ideal market niche would have the following characteristics:

* The niche is of sufficient size and purchasing power to be profitable

* The niche has growth potential

* The niche is of negligible interest to major ompetitors

* The firm has the required skills and resources to serve the niche effectively

* The firm can defend itself against an attacking major competitor through the customer goodwill it has built up”

To what extent does your chosen niche fit these criteria?


The soundness of morality

Whatever the sometimes unfathomable justifications used to defend government policy (and this happens all over the world), one can still agree that a policy is an improvement on the past.

The idea of relinquishing control over things is so abhorrent to most politicians that it lays bare the aphrodisiac of power.

The only fix is to take back the unnecessary powers held by politicians, and then ensure that strong checks and balances – inhabited by people other than politicians – prevent the same mistakes being made again.

Anyone who has ever played SimCity or similar games will have felt the sublime satisfaction in seeing one’s civilisation expand and flourish in one’s image: bulldoze a tower there, build a park here, whack a nuclear power plant there. But perhaps not everyone would be happy with it there, and that is precisely why we must prevent anyone from enjoying power without accountability.

~ Tunku ’Abidin Muhriz (ideas.org.my)