US Finance World

Yet if there’s any consolation to be taken from the past 18 months, it’s that many people now pay more attention to their total financial picture — not just stock and bond investments, but saving and spending habits as well. “There’s no silver bullet that can undo what happened last year,” said Richard Hisey, president of AARP Financial Inc. “There’s no guarantee [that losses won't happen again] but that’s no reason to not take steps [to improve finances].”

There are basic financial measures that all investors should be aware of, Hisey said, such as being disciplined about spending and keeping a watchful eye on an investment portfolio’s asset allocation.

“If anyone takes an objective look at their finances and how they can improve them, it’s surprising how [much] they can make improvements by having a budget and sticking to it,” Hisey said.

“People don’t have time to focus on their saving as much as they should,” he added.

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Wintry conditions can put many people off driving. Read more…

On Christmas Eve one would think you could have a nice evening with your family. Little did I know what Timmy Geithner had up his sleeve:

The two companies, the largest sources of mortgage financing in the U.S., are currently under government conservatorship and have caps of $200 billion each on backstop capital from the Treasury. Under the new agreement announced today, these limits can rise as needed to cover net worth losses through 2012.

I see. But I thought housing was getting better? That’s what I heard on CNBS Tuesday when existing home sales came in “above expectations.”

But then Wednesday came around and, well, new homes? They’re just not selling.

Purchases dropped 11 percent to an annual pace of 355,000, lower than the lowest estimate of economists surveyed by Bloomberg News, figures from the Commerce Department showed today in Washington.

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You may wonder who pays the real estate agent when a foreclosed home is purchased. In these economic times there are many foreclosed properties on the market. There are many real estate investors who are buying up homes rehabbing them and selling them for a profit to first time home owners and even to other investors. Some investors are paying as little as thirty cents on the dollar.

They are buying from foreclosed properties or what is known in the real estate industry as an REO. This stands for real estate owned. These are properties that the bank owns because they were foreclosed upon. The buyer or person who took out the loan on the house failed to make the requisite payments and defaulted on the loan and now the bank owns the property.

The problem however is that banks are not in the real property selling business. Banks are in the business of lending money. Now we have banks with a large inventory of foreclosed properties, or REO’s. B

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‘Hot Stocks For a New Decade?’ Wait a Minute!

Hands up if you had Southwestern Energy.

No? How about XTO Energy? Range Resources? Precision Castparts?

Tim Foley

You should have. These were top stocks of the decade in the Standard & Poor’s 500-stock index. Ten years ago, the smartest thing you could have done with your money was to invest in these. Each $1,000 invested then would be worth tens of thousands today.

Now look at the stocks the experts told you to buy instead.

The most widely recommended — according to a quick survey at the time in the Washington Post — were America Online, Cisco Systems, Qualcomm, MCI WorldCom, Lucent Technology and Texas Instruments.

Ahem.

Any people who invested in that portfolio have lost about two-thirds of their money. The average stock picked at random was up 3%, including dividends.

Beware of ‘Disaster’ Picks

Money Magazine’s “The Best Investments for 2000 and Beyond”: down about a fifth.

The SmartMoney/Wall Street Journal Sunday picks fell by about a half.

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