Why don’t we save?
I caught the New Hampshire debate on Saturday night in between watching the Pittsburgh and Jacksonville game. (Note to the NFL, enough already with the Jeep Liberty commercial with the singing animals.) Where was I? Oh yeah, the debate. While watching the debate I heard the politicians speak about the American Dream becoming harder and harder. They said that health care costs are rising. They said that gas prices are out of control. They said that it’s harder to feed a family today than ever before.
Not once did any of them mention that saving money is no longer a priority in America especially at the government level.
Why don’t we save? Saving is simply a habit. Just like watching television, eating healthy and exercise. Most people just don’t think about saving. Today while checking out my rss feeder, I came across 7 ways to save :
- Look for discounted dinner entrees
- Don’t throw out the Valpak or Money Mailer they’re chock full of coupons for local restaurants. Skip the appetizers and the desserts while you’re at it skip the booze, the alcohol is always over priced and you shouldn’t drink and drive anyway.
- Return unopened, unused items
- Lowes and Home Depot don’t even require a receipt if you bought it in the last 90 days or something like that and they automatically credit your credit card.
- Look for extra grocery savings
- Cutting coupon sucks, ok it sucks big time, but if the coupon says $2 off 5 Lean Cuisine Panini sandwiches and you were planning on buying 5 Panini Sandwiches, go ahead and pick up a 6th, your wallet won’t know the difference.
- Check out materials from the library
- If you live in Denver, our library system has the most unreal DVD collection in the world. Sure you wait a few more weeks for new releases and the mailman doesn’t drop it off or picks it up at your house but it gets you out of your house and you might run into an old friend who looks really good in wingtips but really bad in birkenstocks.
- Bundle cable, phone and Internet services
- Get rid off cable and your phone altogether. Television is just more noise in an already noisy world. Sure you’ll miss watching Family Guy at 1 AM on Cartoon Network but you won’t miss spending $50 each month. To entertain yourself learn how to juggle or get DVD’s at the library. As for your telephone, it will only serve one purpose in 2008 - for politicians start calling you to ask for your support.
- Negotiate with monthly service providers
- Sure the cleaning people clean great the first time. Sure the landscapers mow your lawn great the first time. Wait till they “forget” to show up or when they’re on the 3rd go around, you’ll be less than thrilled with their service and you’ll end up doing it yourself.
- Stash money for easier savings next year
- Money will double in 7 years. I deposited $250 in a mutual fund in 2000 and it turned into $500 by 2007. The money even withstood the dot com and stock market drop off in the early 2000’s. I couldn’t buy a laptop for $250 in 2000 but I can definitely buy one for $500 today.
No more excuses.
Countrywide righting a wrong or righting their ship?
Countrywide Financial Corp., the nation’s largest mortgage lender, plans to offer refinancing or modifications on $16 billion in loans whose interest rate is set to adjust by the end of 2008.
Rocky Mountain News: Countrywide to push refis, modified loans
New York Times: Countrywide to Help Restructure Loansm
Or are they simply trying to get more business?
Mortgage giant Countrywide Financial Corp., whose loan volume is down sharply in the wake of the housing downturn and the sub-prime meltdown, is aggressively trying to get its customers to refinance. Here are excerpts from two pitches the company sent recently to homeowners:
Exciting news — we are now offering a Special Online Rate Discount. . . . If you qualify, you could get up to $511,006 to pay off credit cards and other loans.
– Countrywide e-mail
No need to show bank statements or verify other assets . . . no paycheck stubs or proof of income required . . . no new appraisal needed (in most cases).
– Countrywide flier
Could be a combination of both. However, this uber annoying Countrywide commercial has been in HEAVY ROTATION:
Real Estate has clout
When it comes to jobs:
One out of every nine jobs in Colorado is tied to the multibillion-dollar residential and commercial real estate industry, according to a report released Thursday.
Read the full story: 1 in 9 jobs tied to real estate
However, more are more mortgage jobs are being cut each weak so expect that ratio to increase.
Foreclosure begets REO
When I think of REO, I rarely think of properties, real estate, or banks. I usually think of the Holiday Inn commercial. You know the one where the guys hum “Take it on the Run” by REO Speedwagon:
REO stands for Real Estate Owned. People inside and outside of the real estate industry believe that foreclosure and an REO purchase are one and the same. They aren’t. A REO property is the direct result of a failed foreclosure sale.
To learn more about REO, visit the REO BLOG.
How does the credit crunch affect Denver?
According to this article from the Denver Post, it’s impact is quite severe on commercial real estate:
The mortgage meltdown and resulting credit crunch that have rocked the housing market nationwide are reaching their tentacles into commercial real estate.
In metro Denver, several office transactions have fallen through because of the tightened credit markets. The World Trade Center downtown is back on the market after a contract with Broadway Capital Partners fell through; and International Capital Partners pulled out of a deal to buy Plaza Quebec in Englewood, according to people in the commercial real-estate industry.
Read the full article: Credit crunch widens locally
What’s in Your Wallet!
I’ve never been a big fan of credit cards. Check that. I’m a big fan of credit cards just not a big fan of credit card companies. I use my credit card quite frequently mainly to track my family’s spending habits. It helps us plan our budget each month. As a side bonus, I get points to use on hotel rooms or airlines tickets. Before I signed up for Opt Out Prescreen, the stream of credit card solicitations I received in the mail was endless. The worst offender year after year was Capital One.
You’ve all seen their commercials - Barbarians, Goths, Vandals, Vikings, et. al. are seen pillaging and ransacking until someone “whips out” their Capitol One credit card. The aforementioned savages are tamed at the sight of the credit card. Far fetched? Sure. Catchy? Definitely! Those commercials never sold me on Capitol One. Moreover, the hassle of signing up for a credit card and having to read the fine print swayed me from getting their “No Hassle” credit card.
Art sometimes imitates life. According to Business Week’s article A big lender’s credit card trap, Capitol One has pillaged and ransacked their clients with fees and penalties.
What’s in your wallet?
Top Five Fridays - Denver Radio Stations
Whenever I get in my car, I usually connect my ipod via an FM transmitter. Rarely do I listen to the radio. With my ipod I can listen to what I want without the ridiculous mortgage commercials. However, when I do listen to a radio, here are my top five stations:
- 101.5 Martini on the Rockies: They serve up a decent mix of old (Sinatra, Dean Martin, Bobby Darin) and new (John Legend, Norah Jones)
- 97.3 KBCO: They play mainstream alternative music with a steady dose of U2 and Dave Matthews Band.
- 93.3 KTCL: Sort of like KBCO with a heavier edge.
- 105.5 Jack FM: It’s a radio station with ADD. 80’s music is always in heavy rotation.
- 104.3 Smooth Jazz: When you know who Dave Sanborn, Boney James, and Diana Krall are, it’s official, you’re old!
Christmas
Christmas is upon us. Seasons Greetings. Happy Holidays. Whatever you call it, celebrate it. When I was much younger I remember getting into an argument with an ethnic co-worker when he took offense to the whole idea of Christmas.
Rather than argue with him, I asked him why he felt that way. He went on to tell me that it’s not right and not fair. Wanting to know more, I asked him what’s not right and what’s not fair. He went on to tell me that everywhere he went there were lights and trees and wreaths and poinsettias and Christmas music. Go on I asked. He went on and on about how Christmas was literally shoved down his throat.
I told him I understood because it’s shoved down my throat too. Stores hit you up with Christmas displays as early as September. The newspaper ads and the commercials on television don’t market Christmas they market buying stuff. Christmas should be simple. I prefer a tree with old fashioned ornaments not the one’s you buy at Hallmark. I prefer to buy gifts for people and not expect anything in return. I also prefer to buy thoughtful gifts and not gifts that someone says they want because the expression on that person’s face is priceless when they receive something they didn’t expect. I prefer time with my family. I prefer watching the old school Christmas classics like “Rudolph the Red nosed Reindeer” and “A Charlie Brown Christmas.” Last but definitely not least a Christmas Eve church service. In the end I want Christmas to be the way it was when I was a kid.
He questioned me about why I never mentioned Jesus. I told him I just did. Keeping things simple. Giving. Spending time with my family. Church service. Last and definitely not least, we walked away friends.
Denver Infill Blog
Recently I stumbled upon a site called the Denver Infill Blog :
“Welcome to the DenverInfill Blog — News, ideas, and commentary about Downtown Denver and its urban infill developments.”
If commercial and/or residential development in Denver, Colorado floats your boat, this blog is for you! Also discussed are urbanism, lofts, and up and coming neighborhoods such as Ballpark, Golden Triangle, Riverfront, Curtis Park, etc.
The post that really caught my eye and got me hooked on this blog is entitled Lessons from Portland, Maine. Ken, the author the blog, takes a stroll through Portland, Maine and discusses the finer points of unpretentious urbanism.
Whose fault is it?
Foreclosure and the real estate market is a hot topic in the Denver news (print, radio, and television) lately. One reader of the Rocky Mountain News shot back that realtors need to take responsibilty for the foreclosure problem:
Real estate market in normal part of cycle
I read the article last Saturday, “Foreclosures up 32 percent in first quarter.” It oversimplified the problem. One very big problem that has repeatedly plagued Denver is jobs, or lack of them, and how our booms and busts have determined our market.
Every real estate market - local, regional and national - goes through cycles. This results from the market pushing supply and demand curves to a natural state of equilibrium. Residential growth and purchasing will always follow commercial growth. Since we now have a more diverse job market, we should see a more moderate cycle in comparison to the last 2 1/2 decades.
Everyone wants to tell everybody what the problem is, and it is never their fault. Is the lending environment a factor in foreclosures? It is certainly part of it. Is the overbuilding along the Front Range part of the equation? You bet.
I often get into arguments with Realtors who blame the problem solely on lenders. But did they mind when they got their commissions for putting people into these homes? I don’t think so. We have to consider a number of factors when engaging in public discourse over a subject that scares and intimidates people. Simply put, history repeats itself and the Denver real estate market is no different - we are just going through a normal part of the cycle.
Dan Narsete
Esox Investments