Money Archive

This Frontline documentary on the credit card and banking industries is disturbing on so many levels, it's hard to know where to start.

I know I'm not my credit company's best customer, and that's fine with me. Not only do I never carry a balance, I make several payments a month, because I want to hold their credit for as little time as possible to limit whatever penalties from fees and interest might accrue in case something happens and I don't make my payment.

But for people who have balances, either from circumstance or conspicuous consumption, the system is really stacked against them. The penalties are harshest for those least able to pay, which makes sense in terms of bank profits, but not in terms of anything else.

What they don't want is customers like me who pay in full or people who don't pay at all. So people get wrapped up in a debt straightjacket and can't get out, which is exactly what banks want. Those are their best customers, namely people who can't pay off their balances but continue to pay.

Meanwhile, even though the economy is crashing around us, banks couldn't care less as long as profits continue to rise. The regulators won't or can't do anything to change the system because, as Dick Durbin said earlier this year, the banks own Congress.

Until our system of legalized bribery that is the campaign finance mess gets fixed, we will never solve this problem. When elected officials worry more about where their next fundraising dollar is coming from rather than doing the right thing for the American people, we're all screwed.

You can watch the entire program online at the PBS website.

This video is amazing. It really brings home the whole process of how the loans and why they are so important to make. If you were sitting on the fence about whether or not to get involved, watch the video and you'll want to jump right in and lend.

To find out more or to make, go to a loan, kiva.org

Here's my personal update for my Kiva loans:

Statistic Name	Me	Avg. Kiva User
Total Amount Loaned	$800	$134
Total Amount Repaid	$714	$75
Amount of Ended Loans Not Repaid In Full	$5.00	$1.30
Amount of Ended Loans	$550.00	$45.79
Default Rate	0.91%	2.85%
Delinquency Rate	0.00%	2.21%

Lately I've been watching and doing some trading of the Exchange Traded Fund (ETF) called FXP.

This ETF is one of many that is sold by Proshares that seeks to represent twice the movement in the markets:

UltraShort FTSE/Xinhua China 25 ProShares seeks daily investment results, before fees and expenses, that correspond to twice (200%) the inverse (opposite) of the daily performance of the FTSE/Xinhua China 25 Index.

It's a very powerful instrument. Not only does it give you access to scores of Chinese stocks in one security, but if you are bullish on the market, as I am, you have incredible inverse leverage. However, this is very much like playing with fire.

Earlier this month, bought 100 shares of FXP for 111 dollars and sold it a few days later for 128 bucks for a tidy 10% profit. Then FXP shot up to 183.99 and I felt like and idiot. That was on the 27th, a mere five days after I dumped my shares. If I held on and was able to sell at the peak, which is unlikely, I would have made and additional $5500. Oops.

Well, then FXP started to plummet, and plummet fast. The very next day, the DOW soared almost 900 points and FXP got absolutely hammered. Today, it is trading below 100. Simply amazing.

This is not for the weak of heart.

While I was contributing to my 401K with my old employee, I had no problems holding on when the market went down because I was buying on the cheap. However, as I had left the company and was no longer contributing to the account, I didn't want to limit my options to the handful of crappy mutual funds selected for me by the no-nothings in our benefits department, so I rolled it over. It was already down 23% for the year and headed further south. I had the money in cash out of the market for the last few weeks, which was extremely lucky.

I don't think we've seen the bottom of this market. Not even close. I think there are many other shoes to drop. Bank failures around the world (Iceland is Melting?). Massive sell offs in the major markets and all the minor ones. The coming shopping disaster this Christmas that is going to cripple the US economy. Plus god knows what else.

Is this where we're headed (again)?

It's hard to imagine that even if the 700 billion dollar bail out passed that this country (and much of the world) would not be headed towards something of a financial armageddon. I've said this before, but despite what John McCain has said, the fundamentals of our economy are not strong.

The Debt

The US government (and by extension you and me) owes almost 10 trillion dollars. Amazingly, we're in the midst of a presidential and this simple fact never gets mentioned. We'd have to raise taxes to even start thinking about paying it off. Raising taxes has become politically unpalatable that this will never happen. The debt will never be paid off. Eventually China, Japan Saudi Arabia and all the others will stop lending us money. Already we pay about 250 billion dollars a year to service the debt. We won"t default on the debt obligations. We'll just print more money. This will deflate the dollar, force interest rates and cause massive inflation a al Argentina. What fun.

Savings Rate

American's can't save money. The live paycheck to paycheck and if they have an emergency or want something they can't afford, they finance it with credit card debt or home equity. We now credit cards are maxxed out and home equity is non existent. Now that no one can ignore horrors of a recession, people might start to save a little which will only make the problem worse, since our economy is based on consumer spending. A tiny increase in saving, say 1-2% will decrease spending about 150-200 billion which is about 1.5-2% of GDP. That will wipe out any increase in the economy and put us into a recession alone.

Manufacturing

We don't make anything any in this country. We sell services. This includes financial services like packaging mortgages that didn't casue the problem we have now, but pushed our over the edge. China, the country that does manufacture anything won't lose any sleep over losing the US as their main market. They have a huge market at home that's almost ready to step up and buy just about everything they make.

The Dollar

The dollar will soon lose its status as the world's reserve currency. In essence, it really isn't anymore which is a large reason for the staggering increase in the price of oil. It's still priced against the dollar, while it probably should be pegged to the Euro. A weaker dollar means cheaper exports, which on one hand is good for the economy. But it also means that American assets are really cheap and our overseas creditors are going to swoop in like Japan in the 80s, buy up our properties and companies and take the profits back to the their countries.

Wall Street

Today the DOW shed more than 750 points. Estimates are that $1.1 trillion in wealth vanished. What's going to happen tomorrow? More panic selling? Hard to say, but it's possible. I'm not a psychologist, but I suspect many people are going to want to stop the bleeding, are going to liquidate mutual funds which is going to cause a massive sell off and hammer the market. Wall Street will soon be surpassed as the world's financial capital by Shanghai.

That's just the major stuff. When you add infrastructure, human capital, deregulation, banking problems, home equity, we're, what's the phrase I'm looking for? Oh, right, We're fucked.

DOW January 19, 2001: 10,587.59
DOW September 29, 2008: 10,365.45

NASDAQ Jan 19, 2001 = 2770.38
NASDAQ September 29, 2008 = 1983.73

CPI, January 19, 2001: 175
CPI, September 29, 2008: 219

Dollar exchange with Euro, January 19, 2001: 1.068
Dollar exchange with Euro, September 29, 2008: .695

Add in the price of a gallon of gas and a cost of a barrel of oil and I'd say that's a unqualified "No".

I woke us this morning to find* that my bank Washington Mutual was broke and was sold off to JP Mortgan after briefly being held in receivership for a few hours by the federal government.

WaMu becomes biggest bank to fail in US history

NEW YORK (AP) -- As the debate over a $700 billion bank bailout rages on in Washington, one of the nation's largest banks -- Washington Mutual Inc. -- has collapsed under the weight of its enormous bad bets on the mortgage market.

The Federal Deposit Insurance Corp. seized WaMu on Thursday, and then sold the thrift's banking assets to JPMorgan Chase & Co. for $1.9 billion.

Seattle-based WaMu, which was founded in 1889, is the largest bank to fail by far in the country's history. Its $307 billion in assets eclipse those of Continental Illinois National Bank, which failed in 1984 with $40 billion in assets; adjusted for 2008 dollars, its assets totaled $67.7 billion. IndyMac, seized in July, had $32 billion in assets.

One positive is that the sale of WaMu's assets to JPMorgan Chase prevents the thrift's collapse from depleting the FDIC's insurance fund. But that detail is likely to give only marginal solace to Americans facing tighter lending and watching their stock portfolios plunge in the wake of the nation's most momentous financial crisis since the Great Depression.

Rumors of WaMu's demise have been around for weeks. I was never really worried since my deposits are well below the FDIC insurance level, but I contemplated moving my savings to my other account at Wells Fargo. I'm bummed about this whole thing since I've really liked WaMu. I like their style, their service, their lack of fees for anything and their website. I wanted to stick with them. We'll see what happens with the merger, but I suspect WaMu's stick-in-the-eye of traditional bank marketing will mean an end to the brand. Sad.

How did this happen? Sure WaMu made bad bets in the sub-prime mortgage backed securities game. Who didn't? But it was exacerbated by a classic run on the bank:

The fate of Washington Mutual was sealed by a run on deposits as customers lost faith in the bank, federal regulators said Thursday in seizing the nation's biggest thrift.

WaMu had continued to assert in recent weeks that it had adequate capital to keep going, despite heavy losses this year on defaulted mortgages.

But the Office of Thrift Supervision said "significant deposit outflows" began on Sept. 15. "During the next eight business days, WaMu deposit outflows totaled $16.7 billion," the OTS said in a statement.

WaMu had total deposits of $188 billion as of June 30.

"With insufficient liquidity to meet its obligations, WaMu was in an unsafe and unsound condition to transact business," the OTS said.

Of course, this shit always warms my heart:

Washington Mutual Chief Executive Alan Fishman could walk away with more than $18 million in salary, bonuses and severance after less than three weeks on the job, according to the terms of his employment agreement.

These are ugly financial times—except for people like Mr. Fishman who should come out of this arlight. The market is all over the place. Many 401(k)s have been crushed. It's ugly and it could get a whole lot worse.

The United States economy is a flimsy house of cards propped up by consumer spending fueled in the last few years by credit card debt and home equity. With credit max'ed out, no home equity and people freaking out, who is going to spend money to prop up the economy? Certainly not Americans. It's going to be an ugly holiday season while the dollar goes into slow-motion freefall. I wish I was getting paid in fucking Euros.

*actually I knew it was going to happed last night and, though I feel sorta silly about it I went down to my local branch to take out some cash just in case.

I've kept up my association with Kiva, making loans to small businesses around the world. Right now, I've got $400 in loans in various states of being repaid. There's still $243 outstanding, but payment notices coming on a weekly basis which is deeply satisfying. The latest, this morning, is from a general store in Iraq. My other loans right now are to Vietnam, Kenya, Mozambique, Cambodia, Bolivia, Pakistan, Indonesia and Nepal.

Everyone's favorite day is here. It's tax day in America. I'm getting slammed. Mostly, well, almost all, because of capital gains on a particularly inefficient mutual fund. It doesn’t help that I have virtually nothing to deduct: no kids, no business, no mortgage. So I had to cough up about 1600 bucks.

The fund has gone up, which is always good, but the captial gains are really high and since the gains were paid out at the end of last year and the fund has subsequently gone down, it feels like I'm paying tax on phantom income. Sorta sucks, but the fund will come back. It's very volitale but mostly heading in the right direction.

There's a strange psychology in this country. People get really happy when they're expecting a refund and bummed as all hell when they have to make a payment to the IRS. I can understand the second one, but the first one is really nonsensical. Sure, people like getting a check. No getting around that. But the truth is that when you get a refund, all it really means is you've provided an interest free loan to the federal government. I don't get the feeling that many people would be excited about that.

The ideal situation is where on April 15th, you owe nothing and pay nothing. The way to do this is to adjust your withholding amount on your paycheck. If you're getting a refund, simply withhold less. You won't get a refund check anymore, but you'll get a de facto raise and you'll stop being a creditor to Uncle Sam. If you're having to pay, withhold more. That way you spread your tax liability over the course of many months instead of having to write a huge check to the fed and the state. Not that this is anything you don't already know.

I sent my final check in to Capital One today and now the Subie is free and clear. I have no other debt. No student loans. No credit card debt. No Mortgage. I feel like a free man, and, damn does it feel good.

One of the reasons It feels good is because I'm not directly contributing to the fiscal disaster that's facing this country. My fellow citizens (and American persons) owe more than 1 trillion dollars to the credit card companies. Who knows what untold dollar amount is owed to banks in underwater mortgages. And worst of all, the US is like some piss poor debtor country with almost 10 trillion in debt.

This is the legacy of Reagan, Bush, and that retarded chimp that now occupies the White House. Thank you, Republicans. Fucking morons. Thanks for caring more about the unborn children of other people and frozen embryos than our balance sheet. I'm putting all my money in euros and pounds.

Here are some details:

• U.S. National Debt Clock
• America's Total Debt Report
• When credit cards put you in jeopardy

I finally got around to talking to US Bank about their outrageous fees for foriegn currency exchange and they agreed to reverese the charges for the two most egregious line items--more than 80 dollars for two transactions. Chris, the customer service rep explained to me that they can only reverse two charges per year. Fine, but I'm willing to bet anything that if they do this again, and they will, that if I elevate the call to one supervisor and then the next supervisor I will eventually find someone at US Bank who reverse whatever charge I want under threat of losing me as a customer. And if not, well, there are a few other credit cards on the market who will be happy to have my business.

Dear Andrew Hecht,

The business you have loaned to, MAWUPEMO, has made a repayment of $166.00. The total amount repaid up to now is $500.00. The payment was collected and deposited by Microfund Togo. This repayment will be divided amongst all the lenders who helped to fund this business, depending upon the percentage each lender contributed.

The first of Kiva loans has been repaid. Mr. Kouassi Houessou used our loan to buy a freezer and two coolers to expand his ice cream business in Lomé, Togo. His enterprise must be doing really well because he managed to repay his loan in 2 1/2 months and the terms of the loan called for 3-12 months.

This is a seriously feel good moment.

I continue to urge you get involved. It's really simple. Go to Kiva.org. Find a loan you want to help finance. Register. And then pay for the loan with your Paypal account. You'll be glad you did.

I used to be the case that when you traveled abroad, the best way to use your money was with your Visa or American Express. You'd get the best exchange rate. You wo uldn't have to worry to much if it was lost or stolen. You have good consumer protection. Those things are still true today. The big difference is that credit card companies have started charging transaction fees for currency conversion. And the fee is progressive, meaning the larger the transaction, the larger the fee. This is a joke and is takes no more time and costs no more to post a transaction for 1 Euro as it does for 10,000 Euros.

Even knowing this, I'm stunned when I look at my Visa bill and see over 80 dollars in fees for the skiing vacation (condo and lift tickets) that I booked in Whistler (damn, Canadians still have their own money apparently). 80 bucks. That's a lot of money. So what should I do?

I wrote my credit card company, which shall remain nameless (US Bank), and explained my position and demanded that the reverse the fees. I threatened to cancel the card even thought I've had it for years and have no real desire to do so. I said I have a myriad of choices of in the market place today. Why should I stay with a credit card company that is going to charge me 80 dollars in fees for nothing?

I don't really want to change. I've been using this credit card for years, like I said. It's attached the Northwest Airlines frequent flier program and I have accrued almost 200,000 miles, mostly on credit charges amazingly enough. Even little transaction ads up. Just as eery little fee adds up, but this is not little fee. I have to change, so be it. We'll see how they respond.

The first of the Kiva loans starting being repaid today. Mr. Kouassi Houessou began repaying the 500 bucks he borrowed for a new freezer for his ice cream business in Togo and Madam Akossiwa Agbemaple made a repayment of 75 dollars on the 450 she used to build up her charcoal sales business, also in Lome, Togo.

To me this is very inspiring stuff. I expect all the loans I have made to be completely repaid and these business to flourish. When the money comes back, I will loan it out again so it can help more entrepreneurs who don't have access to traditional financial institutions. I highly encourage you to loan, even the smallest amount, 25 dollars, can make a huge difference, and it will make you feel great.

To read more about Kiva go here. To start a loan, just go the Kiva home page and sign up for an account. If you don't want to sign up for an account for some reason, just send me the money and I will loan it for you. One person has already done this and I've been sending her regular updates on the progress of her loans. Planning on giving someone money for a birthday or whatever? Why not fund a loan in their name? When the money is repaid, they can decide what to do with it. Whatever way you do it, it will be one of the best things you'll ever do in your life.

I received an update from Kiva this morning from one of the loans I helped fund, Tienda Ronny, a going concern run by Elsy Santana Guayaquil, Ecuador:

Elsy emprendedora muy trabajadora. Su crédito lo invertirá en la compra de inventarios para atender a la comunidad de su sector. Ella espera en un futuro tener un negocio mas grande para así generar ingresos suficientes para el bienestar familiar. Su financiamiento en estos momentos es de mucha importancia para su visión, les agradece a toda la comunidad Kiva solidaria por la noble gestión en la lucha contra la pobreza.

I don't read the Espanyol so well, so I went over to Babelfish, still one of the most useful sites on the web to get a translation:

Enterprising Elsy very worker. Its credit will invest it in the purchase of inventories to take care of the community of its sector. It hopes in a future to have a great business but thus to generate sufficient income for the familiar well-being. Its financing at the moment is of much importance for its vision, is thankful to them to all shared in common the Kiva community by the noble management in the fight against the poverty.

Okay, so it's not a perfect translation, but I get the idea. It's very exciting for me to get updates like this. I can't wait to see more from Elsy and the several other entrepreneurs around the world whose businesses I'm now a part of.

I cannot express enough how import microfinance is fighting global poverty. The people who give out the Nobel prizes know this. They just presented Muhammed Younis, the founder of microfinance from Bangladesh with the 2006 Nobel Peace Prize.

It's really simple to get involved. Just go kiva.org and sign up. And remember this is not a donation or grant or a gift of any kind. This is loan to responsible business and you will be giving the money with the expectation that your loan will be repaid. You won't earn interest, but you will earn a tremendous amount of good will and feeling that even a little effort can go long, long way.

Yesterday I received a $500 award for excellence at work. It's the second one I've received in the last 2 months. It feels pretty good to be recognized, even better to get 500 bucks for doing nothing more than what I consider to be my job. The first award came in the form of AMEX gift checks. I got 5 checks for a 100 bucks each. For the one yesterday, i got an AMEX gift card. It came with all this literature and instructions on how to check your balance online and all this stuff. I was curious to see how it worked, so I went online to check the balance only to discover that the balance was not $500 bucks, but $494.05. Odd, huh?

When I was reading through the literature that came with the card, I saw it listed all these fees. There's a 2 dollar a month maintenance fee (waived for the first 12 months) and a $5.95 fee for a lost or stolen card. $5.95. Interesting. That's the exact amount missing from my card. Sure enough I checked the account history and back in October there was a charge for $5.95 for a lost or stolen card. This card had history that went back to June. Very strange. It's almost as if it was purchased for someone else, never given out for some reason, and then I become the lucky recipient, but only after it was lost or stolen.

Now the conundrum comes from what to do. Should I say something to the person who it gave to me? We short of have a funny relationship as it is and I thought it was weird that I got the award from her in the first place. Do I tell her what happened? Do I make a joke of it? Hey, you didn't buy lunch with the card before you gave it to me, did you? Or do I do nothing and just take my $494.05 and spend it frivolously? What would you do?

The first of my Kiva loans were funded this morning which means Kouassi Houessou's ice cream business and Akossiwa Agbemaple's charcoal business, both in Togo, just received an infusion of cash and should start to grow. Pretty damn exciting.

I first heard about microfinance when I was living in Samoa. There were a few NGOs in country dispensing tiny loans, less than a 1000 US dollars, to various groups and people to get small businesses off the ground. It doesn't take much money in the developing world, but many of the loan recipients and entrepreneurs don't have access to the traditional finance systems that we take for granted (e.g credit cards, banks, etc.). My own family in Matautu had a little ice cream business that they ran out of our house. I think they needed a few hundred bucks to buy a fridge and arrange ice cream delivery -- lots of inspiration and a little bit of cash.

Anyway, I didn't have any money when I was in Samoa, so I couldn't really help out financially, but now that I'm back in the States and doing well, I have the opportunity to contribute. I heard about this San Francisco based microfinance company called Kiva from a story on Frontline: World.

The story detailed how the company was founded by two Americans who had been working in Uganda. Small microfinance loans from Americans have supported markets, brick makers, peanut butter producers and whole host of other small going concerns in Uganda. The stories were all very inspirational. I wanted to sign up. I went to the website to make a loan only to find that the traffic driven to the site by Frontline had crashed Kiva's servers. A victim of it's own success, it seems.

That was a few weeks ago. Kiva is now back in business, and business has expanded beyond Uganda to Bulgaria, Kenya, Mexico, Togo, Ecuador and elsewhere. They are limiting loans to $25 at a time so that more people can participate. You have 25 bucks, right? And, remember, this is a loan. You give an entrepreneur 25 dollars and you get paid back in 6-18 months. Kiva reports that none of their customers has ever defaulted on a loan and they have a 100% repayment rate. You won't earn interest, but you'll feel damn good about yourself. The process is simple. The payments are all handled through Paypal. Couldn't be easier if you already have an account with Paypal. If not, it will take a few minutes to set one up.

The brilliance of Kiva is that they harness the power of the Intranet to create connections between people that in the past were prohibitively expensive. It is far more personal than simply donating money to charity because you know exactly whom you are loaning money to. You can receive updates from the people whose loans you help fund and track the progress of their business. And there is no bureaucracy to eat up your contributions. 100% of the money you lend goes directly to the loan recipient.

I made two $25 loans this morning. One to Elsy Santana in Ecuador and another to Mary Muthoni Gitau in Kenya. Both have markets. Both, at this point, need additional funds to finish. (UPDATE: Mary's loan has been fully funded, but Elsy is still looking for financing as of November 9th, 2006). It's really nothing. I won't miss 50 bucks if it's never paid back, but I'll expect repayment in 10-18 months.

Want to get involved? You can learn more about Kiva on their website or go straight to the lending page and find a worthy cause.

The good news is that the taxes are done. Finished. Complete. And ahead of schedule. That's a serious load off. The bad is that between state and federal, I wrote almost 5 grand worth of checks. 4,888.00 to be exact. This isn't entirely bad news. It just feels like bad news since it's going to suck the life out of my savings account. On the other hand, the reason I owe so much is that I had a good year in the stock market. While I say that, I don't want this to happen again, so I've changed some of my investing habits. I moved a lot of money into mutual funds that I don't plan on trading and I'm only going to keep a small discretionary amount to fool around with. Why? Because it's fun.

Back to the taxes. I've always been an evangelist aginst the tax refund. Everyone likes to get a tax refund. Who doesn't like a check in the mail or money directly deposited into their checking account. But when you get a tax refund what it means is that you've been giving the government an interest free loan. Personally I don't want to do that even when I like the people running the government and I certainly don't want to do that know with those irresponsibile jokers in the White House.

That said I've never had to pay 5 grand in taxes before. I need to find some deductions this year and find them fast. I either need to buy a house, start a business or have some kids (too bad I can't deduct the cats because they are certainly dependent). Since it's not likely that I'm going to have kids any time soon and I probably won't be able to afford a house unless I win the lottery or move, looks like I'm going to have to start a business. Time to put the thinking cap on.

I'm pretty done with my taxes. Like just about every year, I did them myself on Turbo Tax. The difference this year is that I made a lot of money in the market last year, so I have some short term capital gains that I owe on. Not really a bad thing. I'd rather owe than lose money and not owe. I'd just rather owe less. The current tally is running at about $2700.

So out of deparation I went to H&R Block for a consultation, just in case there might be some deductions I can take that I was missing, but I was SOL. I'm in the worst demographic for taxpayers: I'm single, no kids, don't own a home or any property, don't have a business and make enough money so that my contributions to my IRA are not even deductible.

I left H&R Block rather disheartened, but what are you going do? Maybe it's time to have a kid, buy a house or start a business. I'm leaning towards the two latter.

I don't know what gas prices are like where you live, but here in Alameda, the cost of unleaded has shot up from 2.82 to 2.96 in the last two days. Is it the effect of Katrina? Is it our lack of refining capacity? Is it demand driven by massive manufacturing in China? Who knows.

I just can't keep watching prices go up and do nothing about it, so today I held my nose a picked up a few hundred shares of Chevron, that's CVX for you home gamers. For me, Chevron is always the gas station of last resort. Their prices are almost always higher than the station across the street or around the corner. But to hedge against paying higher prices, I'm going to get me a piece of that sick petroleum action, as much as it kills me. And if gas prices come down and CVs along with it, I won't have a problem with that, but I doubt it will happen. The big petroplayers like Chevron are always quicker the fleece they public by raising prices at the pump than they are to drop prices when the a barrel of crude drops. But with the price of a barrel hovering around 70, there's a lot of padding in the system. If commodity prices continue to rise, Chevron will just pass on the costs to consumers like you me. If oil drops, that's where Chevron and Shell and Texaco and Exxon cash in because they never, ever react to lower prices of unleaded with the same knee-jerk gauging reaction.

In the meantime I'm looking into buying a hybrid next year when the fat tax credit that might have been the only good part of the "conservative" Energy Bill comes into play.

I probably think about retirement more than I should. I'm not in any hurry to grow old and grey but I am looking forward to not working while I travel around the country and the world. Since travel ain't cheap, it's time to get my finances (back) in order while I still have a 30 year investment horizon.

Since I graduated college, my work experience has been, well, sporadic. A year here. A year there. A year in the Peace Corps. And lots and lots of traveling. I've enjoyed it. But it really does put a hole in your retirement planning when you're globetrotting and not working and spending and not saving or investing. Time for that change.

I'm done with my taxes, federal and California, and in the nick of time. I don't usually leave it to the last minute like this, it's such a headache when you do, but there was some things that I had trouble tracking down, and I had no other choice.

I did most of the leg work weeks ago, but the whole picture didn't materialize until yesterday when I ran down to my local Scottrade office to open an IRA. In typical Andrew fashion, it was only when I left the office after finishing the paperwork and writing a huge check ($3,500) that I realized that the maximum allowable is only $3,000. So I had to run back there today during lunch.

It's done now. $3,000 in the tank for the next 25 years. Hopefully it will grow through the glory of compound tax-free interest and, with the addition of some more cash through the years, and a few 401K contributions here and there, maybe, just maybe, I won't die a pauper, although that possibility looms large what with all the presidential bamboozlepalooza business going on.

Anyway, my total federal tax refund, after the sizeable IRA contribution, is 8 bucks. That's right. 8 bucks. Now I've always held that it's better to owe on the 15th because when the IRS writes you a refund check, you've essentially given the government a tax free loan from the time the taxes were collected to the time you refund check clears. So based on that, I'm pretty thrilled with my miniscule refund. On the other hand, it would be nice to be getting a fat check and go on shopping spree, for the purposes of helping out the American economy through conspicuous consumption, naturally. Since that's not happening, I just have to the satisfied that I don't have to write a check to Uncle Sam.

When a penny can't buy you anything and there is a move afoot to get rid of them altogether, why do gas stations still list their prices in tenths of cent? It's asinine.

And the thing is, as stupid as it seems, people are fooled by it. People will tell me that the just filled their tank for $2.09 when it was really $2.099.

Why does this matter? It doesn't really. I mean it doesn't really to you and me where tenths of a cents are a meaningless annoyance. But it means lots of money for people selling hundreds of millions of gallons of gas to Americans.

I don't begrudge petroleum companies their profits, as long as they are being fair about what they sell, which they are not, but that's another story. Just tell me who wouldn't buy gas if it was listed at $2.10 a gallon instead of $2.09 and 9/10? It's just plain marketing stupidity and it should be done away with.

Not a few days after I paid for a credit report I got word from my friend Ursula that starting today, people in western states can get a free credit report from any one of the 3 major reporting agencies. All you have to do is go to https://www.annualcreditreport.com and sign up. I did.

This time I went through Equifax. No surprise here, but there are some major discrepancies between the two reports. I didn't get my FICO score from Equifax (that's not included in the "free", I guess) but according to them, I have no delinquent accounts, which is correct, but I also have a few open accounts that I wasn't aware of and apparently I was formerly known as Andrew M. Heck, which is news to me. They also have B Dalton listed as one of two former jobs. I worked for the bookseller more than 15 years ago when I was in college. Amazing.

After I was laid off from the Electronic Arts back in 2001 (right after 9/11), I didn't have much faith in the company (can you imagine?), so I sold my stock options and put most of it into our main competitor, Activision. The stock market didn't do much in the year I lived in Samoa, but it's been coming around and I'm finally starting to see some benefits.

While EA stock has been more or less stagnant over the last year, ATVI has killed.

The news out today can only mean bigger and better things for Activision which continues to pump out quality games like Call of Duty, Doom 3 and Spiderman to bang up against gaming behemoth Electronic Arts.

I got a credit report for the first time in my life and, big surprise, it's fucked up. I need it apply for an apartment, so I went online to TransUnion and once I jumped through the hoops of self indentification, which included a phone call to someone in India named "Alex", I was able to login and access my credit report which included some really interesting stuff.

My current address was listed as the PO BOX in Orinda, CA that I had before I left for the Peace Corps. The only other previous address was from Atlanta where I worked for CNN from 1996 to 1998.

This was fascinating because it listed my current job at Troop, Steuber, Pasich, Reddick & Tobey a law firm that I worked for in Los Angeles in 1998 which, as far as I know, is no longer in existence.

Now wonder I couldn't "identify" myself through their website.

My FICO score was decent, 827, but it would have been much better had my two student loans, which have been paid off for more than 2 years, not been listed in both Adverse Accounts and Satisfactory Accounts. The only other listing in Adverse Accounts was for a credit card I applied for more than ten years ago, never recieved and never used and then had to fight with them to remove late fees and penalties assessed on an annual fee that the card was no supposed to have. I don't have to tell you what fun that was.

I've already started the process to fix these stupid problems with TransUnion, but I am going to have to deal with Equifax and Experian also? I fucking hope not.

Did anyone notice that there was a change to the DOW components today? AT&T, Eastman Kodak and International Paper were dropped in favor of Verizon, Phizer and American International Group.

Not that this major shakeup is going to affect anyone out there, unless you happen to own any of these six stocks, but it interesting to see major old line blue chips spiraled out of the DOW in favor of newer guard financial giants. It would seem to be a big shift in focus, but it's not nearly as major as the last adjustment which saw the inlcusion of Microsoft and Intel, the first NASDAQ stocks to be raised to that level.

The DOW itself is something of an enigma. Its 30 companies represent a huge percentage of the market cap of all companies in the US, and its swings have massive sway over the economy in this country. But it's only 30 companies out of thousands in the US. People talk about the economy doing well if the DOW is up and vice-versa if it is down. Yet it is only thirty stocks. 30!

Also, if you add the share value of each stock together it doesn't come close to the 10,000 plus level that the DOW is currently qouted. I know there is some crazy formula that accounts for splits of some of these stocks that have been components for more than 50 years, but it is still oddly confusing.

Anyway, adios AT&T, Kodak and IP. Enjoy your retirement back into the S&P 500.

I had a minor panic attack this morning when I looked at my portfolio and it said that Activision was at 13 and change and my net worth was down and mere $7,000 before I came to my senses and realized that ATVI must have split first thing this morning. I checked it out and there was a 3:2 split for some unknown reason. As they say in Samoa, Fa'afetai le Atua.

Yesterday Activision, the main competitor of my former employer, Electronic Arts, and a huge component, not coincidentally, of my portfolio, surged almost 5 percent, returning my net worth to levels not seen since before 9/11.

This is earliest I have ever finished my return (thank you Turbo Tax online). Ironically, for the first time since I was a teenager, I didn't even need to file. According to my W-2, I made $2,302.50 last year. That's two thousand three hundred two dollars and fifty cents.

There are three ways to look at this:

1) I made less last year than in any year since I was 15 years old
2) I was Peace Corps volunteer and was lucky to make anything
3) I'm going to look like one seriously poor muthafucka when I apply for financial aid for grad school (assuming I get in)

Can someone please explain the US Dollar to me? I don't get it. I must have mised the day we talked about currency in Macroeconomics. I've always had a hard time coming to grips with the fact that the US Dollar is weaker than the British Pound. How can than be? Don't even mention other currencies that are stronger than the dollar. The Jordanian Dinar?

But now, our weak ass economy with absurdly low interest rates has caused the dollar the dip against almost every currency, major and minor, in the world. I get that our currency might slip against another ecomony's currency, if that ecomony was one of the world powers. But how about everything else?

Look no further than the miserable Samoan Tala. Take a look in the navigation column on the right and you'll find the dollar exchange rate for the tala. As I write this post, the rate is one dollar equals 2.54 tala. Now when I arrived in Samoa in October of 2002, the rate was 3.25. The rate has fallen steadily over the last year and half.

Now while it's understandable to see the currency slip against the pound, the yen or the euro, it's is inexplicable to me that the US Dollar should slip against the Samoan Tala. Remember, Samoa is country with less than 200,000 people with an ecomony that survives on remissions and handouts, so how could their currency gain against the US Dollar. It just doesn't make any sense.

Now that I'm in the middle of Colorado, it doesn't make much of difference to me. It actually might help me because one of former Peace Corps colleagues is selling the stuff I left behind in Samoa and when the money is converted over the dollars, I'll make out like a bandit. However, I'm a traveler at heart. I will take every opportunity to leave the country and explore our world. And when I do, I'm going to want a strong dollar.

I'm just listing all my major stock prices on New Year's Day so I see how they track during the course of the year. I have high hopes for both ADSX and ATVI. I hope that Ed holds it ground. NOIZ is just a bouns stock so the fact that it's doing well is a blessing. And MCD was my dollar cost averaging stock before I left for Peace Corps

ADSX .47
ATVI 18.21
ED 43.01
MCD 24.83
NOIZ 7.21

-1500 (the amount off my high water mark of 30,000)

1 US Dollar = 2.98800 Samoan Tala
1 Samoan Tala (WST) = 0.33467 US Dollar (USD)

This is the current exchange for the US Dollar against the Samoan Tala. The rate has been on a downward spiral since we arrived in the country in October of last year, as you can see by the table below.

This sucks because as Peace Corps Volunteers, we get paid in the local currency, Samoan Tala. For day to day to purposes, the exchange rate doesn't matter, but if we ever travel or when we convert our cash back to US Dollars at the end of service, it's really lousy to have such a weak Dollar.

You can see an historical table of exhange rates for the last 7 months and read a story from Reuters about how thrilled U.S. officials are with the weak dollar because it helps imports by clicking through the MORE link.