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Lower Your Student Loan with the Income Based Repayment Plan

If you have student loans you may be able to lower your payments with the government’s Income Based Repayment (IBR) plan.  IBR is a new repayment plan for the major types of student federal loans, which include any Stafford, Grad PLUS or Consolidation loan made under either the Direct Loan or FFEL program.  However, if […]

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Jon Stewart’s Very Funny But True Video

March 5, 2009 | Videos | No Comments

The video below is extremely funny but so true. The video clip is of  “The Daily Show With Jon Stewart” exposing the so called experts and executives who don’t know what they are talking about or just plain lying.   From Jim Cramer telling investors that , “Bear Stearns is not in trouble,” and “It’s time to buy, buy, buy” when the company collapses 6 days later to Merrill Lynch saying they don’t need any money when five months later they run out of money. 

Rick Santelli was suppose to appear on the show, however, he canceled so Jon Stewart did this segment exposing the people who don’t know what they are talking about, which includes Rick Santelli.

The Daily Show with Jon Stewart

Should the Government Continue to Bailout AIG?

March 5, 2009 | Insurance | My Ramblings | No Comments


It would be nice to say “No, the government should not continue to bailout AIG”; however, the US government has no choice but to bail out AIG.  This is because if AIG collapses, it will be a nightmare and would seriously damage the already fragile U.S. economy, and even the world economy. Most experts feel a collapse of General Motors would be a thunderstorm, while a collapse of AIG would be a category 5 hurricane to the U.S. economy.

AIG currently has more than 375 million policies with a face value of $19 trillion.  If the 375 million policyholders lost faith in AIG and rushed to cash in their policies at once, the entire insurance industry would tank.  Simply put, AIG is too big to fail.  There is also the fear that if AIG collapses, many people would be unable to obtain the same insurance from a competitor for the same price, which would cause many people to be shut out.

Unfortunately, no one knows when AIG will turn around and how much more money the U.S. government will have to pump into the company to keep it afloat. The government has rescued AIG four times in the last six months.

Last Monday AIG reported a $61.7 billion quarterly loss, the worst ever for a U.S. company. The US Treasury then announced the same day that it would provide A.I.G another $30 billion loan from the $700 billion financial bailout program, although the company already received more than $170 billion in taxpayer money.

Video: AIG Receives Billions More


How did AIG get into this mess?  Contributing factors were as follows: the company used its triple-A rating from the insurance part of its business to run a risky hedge fund, which wrote hundreds of billions of dollars of credit default swaps without hedging itself, or buying protection against the prospect that it would be forced to pay up.

What’s a credit default swap? Credit default swaps are insurance contracts sold by banks, hedge funds and others that promise to cover losses on various securities in the event of a default. They are usually purchased for mortgage securities (we all know what happened here), corporate debt, and municipal bonds. Buyers of credit default swap insurance policies pay premiums over a period of time in return for peace of mind, knowing that losses will be covered if a default happens. Credit default swaps work similarly to someone taking out home insurance to protect against losses from fire and theft.  

When AIG’s credit ratings were downgraded last September, the insurer’s trading partners demanded more collateral, but AIG didn’t have the cash. The US government, worried by the bankruptcy of brokerage firm Lehman Brothers a day earlier, gave $85 billion to keep AIG afloat which went to satisfy the trading partners’ demands for more cash.  

Video: Credit Default Swaps Explained


Who is AIG? American International Group, Inc., (AIG) via its subsidiaries, provides insurance and financial services in the United States and internationally and has 116,000 employees. It operates in four segments:

  1. General Insurance – underwrites various business insurance products, including large commercial or industrial property insurance, excess liability, inland marine, environmental, workers compensation, specialized forms of insurance and excess and umbrella coverages.
  2. Life Insurance and Retirement Services – offers individual and group life, payout annuities, endowment, and accident and health policies, as well as retirement savings products consisting of fixed and variable annuities.
  3.  Financial Services – provides aircraft and equipment leasing, capital market transactions, consumer finance, and insurance premium financing.
  4. Asset Management – investment-related services and investment products, including institutional and retail asset management, broker-dealer services, and spread-based investment products.

It’s Time to Fix the American Healthcare Crisis

March 4, 2009 | Healthcare | My Ramblings | 1 Comment


I am ecstatic that the new Obama administration is finally going to do something about the American Healthcare System, which is a complete mess.  Over a year ago when I saw the movie “Sicko“, produced by film director Michael Francis Moore, who also produced “Bowling for Columbine” and “Fahrenheit 9/11”, it made me very angry.

If you haven’t seen Sicko, I highly recommend seeing it. Sicko is a documentary that highlights the problems and catastrophes with the American Healthcare system. The film profiles several ordinary Americans whose lives have been disrupted, shattered and in some cases ended because of the healthcare catastrophe.

The film highlights that the crisis doesn’t only affect the 47 million Americans who are uninsured, but the millions of other citizens who pay their premiums only to get strangled by the bureaucratic red tape.

Sicko details how the American healthcare system came to be such a mess and highlights countries around the world where all citizens receive free healthcare, including Canada, Great Britain and France. The film also shows how 9/11 rescue volunteers who now suffer from debilitating illnesses have been denied medical attention, however, the suspected terrorist held at Guantanamo Bay, Cub prison receive free healthcare.

Michael Moore’s healthcare proposal is as follows:

1. Every American must have full, uninterrupted healthcare coverage for life.
2. Private, for-profit health insurance companies must be abolished.
3. Profits of pharmaceutical companies must be strictly regulated like a public utility.

Hopefully, Sicko has awaken the American public as to how terrible our healthcare system is and that change is needed.

Trailer for Sicko


Michael Moore is urging people to videotape and post their healthcare nightmares on YouTube to help convince Congress that radical change is needed.

News Clip about the Movie

Resource Links: 
California Nurses Association
The FealGood Foundation
Guaranteed Healthcare
Health Care for All
California State Senator Sheila Kuehl
National Health Care for the Homeless Council
Physicians for a National Health Program

Sprint Paying $100 for Getting Friends/Family to Signup

March 3, 2009 | Cool Stuff | 1 Comment


What to earn $100 and have a friend or family member earn $25?  Sprint is offering a very handsome commission for referring your friends and family to Sprint.  Just go to this link where you’ll be asked to enter the full name and email addresses of yourself and your friends or family members.  You can refer up to 12 people per year.  Sprint will then email your contacts to convince them to join Sprint and reward the both of you.

When your friend or family signs up and is active for 30 days with a Sprint phone, you will be paid with a $100 Sprint Referral Rewards Visa debit card and your friend will get a $25 Visa debit card to spend anywhere Visa cards are accepted.

For more information visit

SmartyPig Paying 3.25% for a Savings Account

March 2, 2009 | Bank Rates | No Comments


SmartyPig is currently paying one of the highest interest rate for a savings account that I’ve seen.  The current interest rate is 3.25%.  Opening a with SmartyPig is free and is FDIC insured.

SmartyPig is for people who want to save for specific goals. Whether it’s a family vacation, the latest electronic gadget, a wedding or a down payment on a house, SmartyPig’s unique system can help you get there. Just tell SmartyPig what you’re saving for, how much you want to save and when you want to reach your goal, and SmartyPig will suggest an automatic monthly deposit you’ll make from your existing checking or saving account until you reach your goal.

SmartyPig functions as a social network where, if you make your goal public, friends and family can provide financial support. You can also add your personalized SmartyPig widget to your Facebook or MySpace page, blog or Website.  Not to mention, you can start your own SmartyPig Friends Network.

For more information visit

No Risk Stock Market Investing with Absolute Return Notes

March 2, 2009 | Credit Reporting | Financial Tips | Stocks | 2 Comments

Do you know you can invest in the stock market with no risk of losing the money you initially invest?  There’s a fairly new type of security called Absolute Return Notes which offers investors a chance to earn investment returns tied to the stock market’s performance, without risking any of the money invested.  Your principal investment is 100% guaranteed.

Absolute Return Notes started in Europe and have recently become popular in the U.S. as investors struggle to cope with the depressing stock market.

During a set time period, the notes pay the absolute value of the performance of a stock market index, within a specified range.  As an example, if the S&P 500 goes up or down 8%, the note will pay 8%.  However, if the market goes out of that range, for example 20%, you will make no money but will get back 100% of your principal.  Now if the index gains 25%, you still get no money but it may hurt thinking you could have made a nice return.

Issuers of Absolute Return Notes include UBS, Barclays and Merrill Lynch.  Fees for the notes are typically included into the formula that determines the payout.  If you pay $10K for a note that offers 100% principal protection, you will get at least $10K at maturity.

Absolute Return Notes is a good short-term investment strategy if you believe the stock market will trade flat or sideways and you want to capitalize on its volatility in either direction with very little risk of losing your money.

Buy Maternity Insurance before Getting Pregnant

March 1, 2009 | Healthcare | Insurance | My Ramblings | 1 Comment


A couple of years ago I was unemployed, and my wife was working for herself as a personal trainer.  We purchased our own medical insurance because it was much cheaper than paying the Cobra insurance premiums offered by the company that laid me off.

A few weeks after being laid off, my wife unexpectedly got pregnant.  We were very excited!  I then assumed I could call my insurance company and tell them to add maternity insurance to my policy for an additional few hundred dollars per month.  Boy, was I in for a rude awakening!  My insurance company, Aetna, didn’t offer maternity insurance, so I shopped around and soon learned that you have to purchase maternity insurance before getting pregnant.  Also, many insurance companies require you to pay the premiums for 1 year before becoming pregnant.  If you got pregnant before the 1 year period, the policy may only cover 50% of normal charges.

Being pregnant is considered a pre-existing condition and many insurance companies will not want to cover you.  If they do offer coverage, your premium will be extremely high, possibly over $1,000 per month.  The average delivery of a baby costs about $10,000, assuming there are no complications.  The insurance companies are in business to make money. So charging you a few hundred dollars in premiums makes no sense, when they will be hit with an $8,000 bill, assuming you pay 20% of the cost.

So the advice here is to plan ahead.   Before you become pregnant, make sure you have maternity insurance or it may cause you dearly.  Unfortunately, my wife had a miscarriage very early into that pregnancy.  By the time she got pregnant again, we had maternity insurance with my new employer.  

Related Page: Compare Medical Insurance Quotes