Why Does Standard & Poors Hate America?

All the downgrades by Standard & Poors seem a little….I don’t know…over the top.

If Warren Buffet calls you out for doing it, I think there’s something a little strange going on, no?  (S&P responded to this by lowering the credit rating on Berkshire Hathaway, which just proves even more that S&P is on some big out-of-control-nothing-based-on-reality kick.  I mean, really?)

Seems to me that S&P is getting a little anti-American these days.  Which is strange to me because the first thing their Wikipedia entry says is that they are a “United States based” financial services company.

Who apparently hates America.

Do they really think that America is going to walk away from their debt? First and foremost, that’s not going to happen.  Second, that’s not going to happen!

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Play The Long Savings Game With Bonds

Today’s post is a guest post from MoneySupermarket.com

You have several different options when it comes to setting aside some money to save. While you can place your money in a traditional savings account or in a retirement plan, you may be interested in looking for ways to invest the money to get interest.If you don’t mind waiting, bonds are a great way to get a return (or interest) on your original amount.You purchase a bond for a certain amount of money. On a future date, when your investment has matured, you can redeem the bond. You are then given the original investment back as well as the interest that was gained.

On a positive note, there is little risk in this investment and it is a secure system. On the negative side, bond maturation can vary and usually it takes a while.

Typically, bonds have a better return on interest. If you stick the same amount of money in a savings account, you aren’t going to come close to making the amount of interest that a bond would generate.

If you have the cash and you don’t need access to it any time soon, this can be a sound venture. You can stagger your investments if you are worried about cash flow.

If you aren’t sure that you want to have all of your money put away and inaccessible at the same amount of time, purchase bonds every once in a while. They will all reach maturation at different times and all of your money won’t be out of reach.

You aren’t going to invest in bonds today and be a millionaire at the end of the year. In fact, this type of investment probably isn’t ever going to turn you into a millionaire.

However, it is an uncomplicated way for you to put money aside and earn interest. Some bonds are set at a fixed interest rate. Because of this, you will have some idea of what you are going to get back for this bond.

There are also instances where the interest rate can be flexible and will change based on economic conditions and other variables.

Before taking on this type of investment, it is important to find out as much as possible about the specifics.

Typically, short term investments come with a lot of risk. If you see yourself with some real long term goals, bonds are a viable option. The risk is low and you are in it for the long haul.

Because of the length of time it takes for a bond to mature, many people choose to give them as a gift to children, or even grandchildren. The younger generation has the opportunity to enjoy the benefits of bond ownership.

Before you rush out and start looking for bonds to invest in, check out the web to get the latest rates and to find out more about how you can obtain this type of investment.

You can purchase directly from institutions such as the federal government and even the bank, but the more information you have about the investment, the better decision you will be able to make.

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When Investing, Do You Invest In What You Use?

There are hundreds of thousands of investment opportunities out there.  From stocks to mutual funds to ETFs to CDs to bonds and many, many other financial instruments, the opportunities are endless.

If you’re making individual investment decisions, one of the things to keep in mind when making investment decisions is the simple question: Do you invest in what you use?

mb-201101appleConsider the following:

  • If you use and love your iPad, iTouch, iPhone, and iPod, do you own any Apple stock?
  • If you use Amazon for most of your online shopping needs, talk about it to all your friends, and blog about it all the time, do you own any of it’s stock?
  • If you’ve been a faithful Netflix customer since 2003, do you have any of their stock?
  • If you just bought a Ford car in the last year or two because you love the cars and believe it’s a solid company, do you own any Ford stock?

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Raise or 401(k) Match?

A co-worker and I were talking the other day and we started discussing the pros and cons of getting a salary increase versus a 401(k) match.

Our company cut both in 2009 and there’s no shot that we’re getting both raises and reinstatement of the 401(k) match.  Frankly, I’m not convinced that we’ll get either.  We’ll probably find out in the next month or so if there is any benefit increase for 2011, though as I said, I’m not holding my breath.

I’m curious as to what the thoughts are as to which is better.  My co-worker was squarely in the corner of the 401(k) match, as the tax benefits and encouragement to save for retirement outweighed the benefit of having a larger paycheck.

I agree with him on these points, but he went so far as to say that a 1-2% 401(k) match would be more favorable than even a 3% raise.

This is where I’m not convinced.  I figure, even with the tax implications, I could get a 3% raise, dedicate 1% of that to increased contributions in the 401(k) and still end up with probably 1.5% more take home pay.

His argument (and again, it was hard to disagree with him) was that, while he and I would probably dedicate some or all of a raise to a 401(k) match, the majority of people probably wouldn’t, and would just take home the money (and spend it).

What do you think?

Do Any Of Us Have A Chance In The Stock Market?

Ever since the ‘flash crash’ in May, where the markets dropped 10% in a matter of minutes only to recover most of it back in just a sudden fashion, I’ve been spending a little more time watching and understanding the market.

What I have found I don’t like.

It seems that computerized trading has taken over the market.  In fact, this computerized trading is blamed for the ‘flash crash’.

It also seems that computerized trading is responsible for most of the trading activity that exists.  So, when you look at the volume of shares traded across a market like the Dow or Nasdaq, chances are most of the billions of shares traded are not done so by humans, but rather by computers.

It turns out that many of the large investment houses have set up computers, with super duper secret algorithms, that perform many of the trades that take place.

I’m not sure how I feel about it.  Actually, I am.

I don’t like it.

Read moreDo Any Of Us Have A Chance In The Stock Market?