Saturday, July 30, 2011

Check Number 69 Off the List!

I got another things done off the list this weekend. I took a photography class all day today at the Chicago Photography Center. I learned a ton! I am really excited to go out and shoot some good looking pictures. We went over ISO, aperture, shutter speed, learned about motion, framing, panning, and a number of other things. The class is actually 3 weeks worth of information at a fast pace.

We all took a long lunch and shot pictures while we were out. I ended up with a cool picture of St. Alphonsus Catholic Church. I made three small adjustments in the developing process on Adobe Lightroom 3 readjusting the white balance, increasing fill lights and blacks. It gave it a very crisp and colorful finish without using saturation. I don't like saturating a picture. It is often used too much and destroys the image... makes for all color and no form. (But that's just my personal feeling and the picture I took could look terrible to everyone but me.)

I am thrilled with my decision to take this class. It was a really good deal through . I have already started planning the next thing I intend to check off my list: Take my whole family on vacation.

I'll leave you with my picture... I was going to scan it in but forgot and framed it as soon as I got home.

Saturday, July 23, 2011

Let's Talk About Recessions!

This week I want to talk about recessions. I have been increasingly curious about previous recessions since it seems the one we are in will not let up. So I did a little research and the top 3 recessions I deem rememberable aside from the one we are currently in are the following:

1. Tulip Mania!

This is a Dutch Recession that happened in the 1630s. People were going nuts about tulips and the price skyrocketed and then all the sudden dropped off. The thing that hurt the most is the bubble got so big that people were selling all their belongings and even houses to purchase tulip bulbs. Some bulbs being purchased were still in the ground. And even further, toward the end of 1636, a lot of bulbs were being traded without the actual physical bulbs present- basically trading debt. And in about February of 1637, the market crashed and contract prices plummeted causing everyone heavily invested in the bulbs to go broke, the people that sold their house to be homeless, and the Dutch economy suffered for sometime afterward.

2. Post WW1

In 1920 and 1921 we had a deflationary recession... deflation is bad because when people expect prices of items to decrease, they stop spending and when people stop spending, businesses collapse and when businesses collapse so does the economy. Along with the decrease in prices of goods, the pay for workers decline as well. Not a good deal. The deflation experienced during this particular recession was about 18%. That's a lot. And the Recession lasted about 18 months, and even though that's not terrible in terms of time of recession the effects of the 18% deflation in such a small amount of time had catastrophic effects. One theory on the cause of this recession, in addition to the changing of monetary policy around 1919 was all the soldiers coming back rapidly filling up the civilian workforce. (One might wonder if the administration is worried that a complete recall from the Middle East could cause further economic turmoil in today's wartime. With a 'real unemployment rate of close to 11%, I can't imagine what we would look like if we flood an already tumultuous civilian workforce.-- but I'm not economist.)

3. The Great Depression  

This one is worldwide and most people are educated on the basics. The timing was varied depending on what country you lived in, but it was generally around 1929-1930. It lasted all the way to the late 1930s and in some countries the early 1940s. It was one of the saddest times for world humanity. It started in the US and really went international on October 29th, 1929 aka Black Tuesday. Unemployment in the US reached 25% and nearly all prices dropped off including crops which fell off 60%. The exact cause of The Great Depression is many, but ultimately it comes down to the fact that we mismanaged avoiding a recession. The reason we set interest rates and toy around with monetary policy is to cause inflation. We don't want to cause too much inflation but we also don't want to have negative inflation aka deflation because of reasons described earlier. But the problem is that the machine is too complex to completely control and when they realize there is a problem, it's too late. Then soon after we recovered from the Depression the US was introduced to WW2. Definitely a rocky time in US history.

SO... We have had other recessions and depressions. We had the Internet Bubble not too long ago, but there is no getting around the fact that the current economic situation is not ideal. I have so many friends that have the hardest time finding a job and I want so much better for every one. But ultimately, if we can learn anything from history... especially The Great Depression... it's that we will correct and life will go on.

Saturday, July 16, 2011

Super Freakonomics...

The book of the week was Super Freakonomics by Steven Levitt and Stephen Dubner. Great book, however, there is surprisingly a lot of sex talk and descriptive words (They dove into the world of prostitution and it goes with the territory.) But point being, if you don't have a tolerance for somewhat uncomfortable language being used in books this isn't for you.

The book is really great though. Levitt and Dubner are very bright men and the information they can bring to light about somewhat controversial issues is really really interesting. Their goal is not to sway the reader one way or the other on any given issue, but to show the reader what research suggests about the issue and get people to start talking.

The book is a perfect cross between basic psychology and microeconomics. I honestly wish this or the first book they wrote, Freakonomics, was required reading for college... I probably would have learned way more.

The book is filled with very detailed information in every chapter, so I cannot give you a whole lot to go from today. But I can tell you about some of the things covered and you can decide whether it is enticing enough for you to go out and pick up the book for yourself!

-Why you want your ER doctor to be a nurse
-What accounts for the male-female wage gap
-Why 38 people watched Kitty Genovese get murdered
-What's up with car seat safety
-What climate models miss
-How to fix global warming and stop hurricanes (My personal favorite)

These and many other issues are tackled. And the knowledge will have you talking, I promise. It's overwhelming what the research shows in some of these areas.

I do recommend this book, again, while making sure you know that you most likely will be offended if you are offended easily. If you have any questions don't hesitate to ask!

Friday, July 8, 2011

Ramsey vs. Kiyosaki

There are two people out there, both authors, that I consider being on two sides of the personal finance/ business finance spectrum. One is Dave Ramsey, the person in the first video, and the other person is Robert Kiyosaki, the person in the second video. Ramsey is focused on eliminated debt all together and living life on what you actually earn. Kiyosaki is very much an advocate of using OPM (Other People's Money) to expedite your growth of wealth.

I don't think either one of these options is completely wrong, however, I do think that one of these could be completely wrong for you. Anyone can do Ramsey's method, you don't have as many toys and live within your means, but you eliminate a problems that causes more fights and stress than almost any other problem in the world- money problems. With Kiyosaki, you can quickly raise up to the top, but you start gambling with OPM instead of intelligently investing you will crash very hard and have more stress and problems than anyone cares to have. Clearly, if you have single and have no one relying on you, but yourself than it might make some sense to take a risk and use OPM to start a business or invest in some properties. But if you have a family the prudent thing to do is steer more toward Ramsey's methods. I think that if you use your head and find yourself wanting a little bit of risk, but not so much you may end up in a gutter, you can always find a place half way in between these two men... that's where I would place a person like Ramit Sethi. I am not here to decide what personal finance path you should take, I just give the information.

Both men have a lot of other ideas outside of debt and I think both men have genius ideas. I have read everything both of them have written and have thoroughly enjoyed all books.

Here are the videos:

Saturday, July 2, 2011

Schwab Checking...

I opened up a new account Charles Schwab this past week. The reason I did it is because their checking account is really great. I have been moving around a lot the past couple years and every time I move I have to change banks because the big banks I have used each time are not big enough to still be in the next city I am in. So I went looking for an alternative to the traditional banking methods and the necessity of having a bank in your neighborhood.

My search led me to Charles Schwab with the help of Ramit Sethi. With the Charles Schwab checking account you can do nearly all things without ever going to the bank. And in addition to being very easy to use anywhere you are they have one incredible perk that I have not seen at any other bank: ATM reimbursements. Okay, some banks do ATM reimbursements, but I have never seen one that is unlimited. This means you can literally use any ATM and assume as many transaction fees as you want and at the end of the month you will be reimbursed for all the ATM fees. That's a huge benefit!

Other benefits include:
-Interest on your deposits
-No fees
-No minimums
-No-fee overdraft protection
-Free checks
-Deposit checks via pre-paid envelopes (no need to go into branch)
-An ATM card

And one of the coolest features they just released is mobile deposits. You just take a picture of the front and back of an endorsed check and put in the amount it is for and it will deposit it for you. The only issue I have found is you can only use the mobile depositing for checks less than $1000.00.

I have been very happy so far! They also have a really great customer service side based here in America with bankers that have answers (which has been my biggest frustration with Wells Fargo). I have been living a very nomad lifestyle, moving from city to city, so my application for an account was rejected because there is no proof I live in my current address. But the customer service side called me after I was rejected and took care of getting me all set up. What I really liked about this is that they called me, not the other way around. I don't have time to be sitting on hold trying to open an account and it seems they understand what the 'service' part of customer service really means.

Here is the link to get an account: Chuck Schwab You'll want the Bank Account Plus Brokerage option.

I have been happy with this service so far... it definitely makes a lot of things easier and has way more perks than I have seen with most banks. If you have any questions let me know and I will do my best to help!