mythbusting financial lies

Interesting show on the Survival Podcast yesterday. The guest was M. J. Demarco, of the Fastlane Entrepreneurs website. I seldom find really practical financial advice with these 'fast-lane-big-scheme-get-rich-quick' guys, but he said one thing that absolutely resonates with me.

In the discussion about financial and business myths, he touched on the one about "doing what you love and you'll be successful". That statement has irked the piss out of me for a good long time. I've been doing what I love for many years, and, well, here I am. Love, passion, your "dream", etc. has  nothing to do with wealth or even basic financial success, and in fact, can blind you to market realities.

Yes, having a business is the only way to grow wealth for a living, as opposed to being an employee. However, as Demarco clearly states, not just any business is going to work if your goal is to become wealthy. It has to be something that fulfills a need of the consumer, not just the passion, interests, dreams and needs of the business owner. This is so true.

Demarco states correctly that "the strongest success factors with a company always lie in the product", and that you need to come at this with the mindset of a producer, not a consumer. If your business is all about what YOU want, it could be totally irrelevant to what other people need — and at the very least, that will cause you to spend a lot of money marketing your product or service. Market needs are key.

It's a very optimistic, rosy view to say that anyone can start a business and become a millionaire, let alone achieve ordinary financial balance at 30.

There is a huge amount of luck and timing involved in bringing the right product or service to the public at the right time. A small mom-and-pop shop is not going to make anyone wealthy, so it's important to keep your financial expectations and goals realistic. A very small niche market business (like mine) is much more vulnerable in an economic downturn than something that appeals to a large spectrum of the public. You must have a strong product with a very broad appeal.


I would also add: a fact that I have learned the hard way is that the first order OF BUSINESS is that you must be passionate about DOING BUSINESS. All that crappy stuff, marketing, paperwork, etc. — that's the MAIN PART of your business day. If you aren't good at this, you are not going to be successful.

I have never been motivated by money, but financial stability would be nice. Not being in foreclosure would be nice.

Not that anyone is asking for my advice, but I'd say keep your passions at the hobby level for your personal fulfillment. When you make that first million off your real, viable business, you'll have a lot more time to pursue them.

dive!

 

This looks great — I can't wait to see it. So much waste when so many are hungry ... There need to be processes put in place by the stores at the corporate level to deal with outdated food. Obviously, throwing it into landfills is not a good solution. When so much commercial compost is now adulterated by chemicals like RoundUp, the very least (in TJs case) that could be done is send it out to organic composting facilities.

screwing the US worker — again

Proof that our two-party system is broken and corrupt — beyond redemption. How could Congress even contemplate this for one second with unemployment at its current catastrophic levels?

From Public Citizen's Global Trade Watch:

The United States International Trade Commission  projects that the Korea trade pact will increase our overall trade deficit. It identified seven key losing industrial sectors — autos (including auto parts) and electronics will lose almost one billion dollars each annually. Apparel and textiles, as well as transportation equipment, such as trains, also would be losers in the deal.

demonizing the poor for being poor

Article in the Seattle Medium

by George E. Curry
NNPA Columnist
Originally posted 5/25/2011

In the 1960s, we had the War on Poverty. In 2011, we're now seeing a War on People Who Live in Poverty.

dancing with the Devil

Yes! I have a job! and what a great one it is!

I'm actually working in the foreclosure industry...a growing field. I get paid $4 to $8 per "unit" to drive, on average so far, about 20 – 30 miles round trip to take photos of houses in early foreclosure status. Of course, it's not a "real" job, it's just piecework. It's working out to about $3.50 an hour so far.

The irony of course is quite amusing.

joke of the day — my cash worth

Not a pretty sight, is it?

just a thought

Okay, I'm just "thinking out loud" here. What I have to say is based on my belief that a large part of the economic collapse we are in was created by the moneyed elite (ie, the banks), so if you don't agree with that you aren't going to like my solutions.

Givens

1. We are in an economic crisis not seen since the First Great Depression. Things are not getting better, and indeed, are going to be dramatically worsening over the next few years. I don't need to listen to our federal government spokespresident or our mass media's misinformation about the economy improving. I have eyes. Jobs being added a cause for celebration? Not if they are mostly low wage service sector jobs, part time, without benefits. This is what the numbers reflect, not an increase of jobs that will support an even lower-middle class lifestyle.
2. The US is experiencing a housing crisis of amazing proportions. Millions of foreclosures already in the process, millions more about to hit the market. The actual value of homes is less than 2/3 of what they were in 2006 — and sinking every day.
3. Fuel and food are rising faster than real wages for most people. 
4. Jobs are key to any recovery. Ross Perot was absolutely correct about "that giant sucking sound". NAFTA, and any other "free trade" agreements are a core part of what has happened with out economy. NAFTA was brought about by the influence of corporate greed, pure and simple. It's all tied together in an enormous economic death spiral. If people don't have jobs, they can't pay their bills, they go bankrupt, got into foreclosure, don't pay taxes, go on public assistance. Towns and cities die, because there is no tax base. Small businesses go under because their customers can not pay for what they sell.
5. We can not fix the economy without fixing jobs, it's that simple. Nothing is being done to address this. I believe that we should have had a reinvention of the WPA 2 years ago instead of the "too big to fail" bailouts. Apparently, this is politically untenable, as it could compete with corporate profits based on low wages.
6. NAFTA must be reversed. The South Korean FTA is a disaster waiting to happen, and the idea of opening up free trade to the middle east strikes me as insane.
7. Wages — the minimum wage must be increased to a real liveable level. Living in a rural area, I just can not drive 40 miles round trip on four dollar gas for a five hour shift at $7.35 an hour. It just doesn't make sense.

So, in practical terms, what's your basic American in financial trouble to do?

I'm behind on my mortgage, just like millions of others. Unlike a lot of people though, I have a lot of equity in my home. When I bought it, I put down well over half in cash (from the sale of my former home). I have struggled to pay my mortgage, but at this point I just can't. It got me thinking...I could try to sell it, but I'd have to put more money into it to make it marketable, money that I really don't have. The housing market is stalled. Nothing is moving and more and more houses are coming on the market this spring just to sit unsold. According to a real estate professional I spoke to, a wave of new foreclosures is about to hit.

So what if...what if I just stopped paying? My house has little value at this point, both to me as an investment (over 100k) and to good ole Bank of America, who holds the mortgage. Given the glut of properties right now, if it goes into foreclosure, it's going to sit empty for a good long time and deteriorate. So it doesn't really serve them to kick me out, but of course this is a gamble I'll have to take. I'm not in a position to get a modification, which would be an ideal solution. With no job, there are no modification plans out there that I can qualify for.

So here is, if not a real solution, a partial pay-back to the big financial institutions for their greed, creation of the housing bubble, derivatives, and their love of "financial innovations".

What if, on a grand scale, people just stopped paying? I have been advised that because of the collapse, there is a several-year time frame for foreclosure processing. So what could they do, in practical terms? There are no buyers because they have clamped down on lending so drastically. Yes, eventually, they will have the properties, but they won't be worth much because of the continuing collapse of the housing market. I know there are flaws in this, but it might be something to think about.

ordinary, but ugly run of the mill banking greed

For four years, I had a small retail shop. When the economy got really bad, I was compelled to close it (last November). Being in retail, it's pretty much a necessity to take credit cards, so I signed up with one of the processors, First Data. Well, after three years of outrageous monthly fees piled upon fees, plus a yearly "compliance fee" of a couple hundred dollars, I decided to close my account. I still had 6 months on the contract, and so I've paid a monthly fee since then to NOT use my account and avoid the "early termination fee". When the contract was up this month, I contacted them to close it. Well, guess what? There is a seventy five dollar "termination fee" to close the account!

When are their outrageous profits enough for these people? I'll tell you this, when the revolution comes, they are going to be the first up against the wall.

gardening

Growing your own food = one part of personal economic security. Heck, national economic security, but that's another topic for another day.

I was late on building cold frames this year, so really early seeding did not happen, but have now gotten most everything planted in flats and 1oz plastic bathroom cups for a good size garden. I drilled a hole in bottom of stacks of the cups for drainage; they are cheap, reusable and recyclable. Optimally, these should be under lights, but when it warms up a bit they will go outside. This is about a quarter of what I have started.


Here's an improvised cold frame I just made from an old underbed storage box. Spinach and salad greens will be going in it. It has a lid, and I'll bank up the sides with leaves for insulation. Overall size is 18 x 34 x 8 inches. I've downsized a lot of stuff out of my life, and don't have the need for storage of this type. I had several of these laying around and inspiration hit!

Great resources for those without a lot of cash for seeds —

The Dinner Garden is an organization that distributes seeds to those in need.

SNAP (food stamps) allows purchasing of vegetable seeds. Generally only available at your local grocery store, as most seed companies are not set up to accept food stamps at this time. But it's worth asking!

Dollar stores. Who would have thought? I'm not a huge patron of these places, but in the spring they carry very inexpensive seed packets (3 for a dollar), and they will take SNAP. As a bonus, most of the seeds I got from this supplier are open pollinated, not "designer" hybrids.

I prefer to use open pollinated, heirloom seeds if possible, as you can save them every year.

Other great resources —
• Johnny's Selected Seeds for an amazing selection and wonderful customer service
• Permies.com for permaculture information
• Cherrygal for inexpensive seeds in smaller quantities (I have not ordered from them myself, but plan on getting some of the herb seeds they carry
• The Survival Podcast is a great, common-sense podcast with lots of info about sustainability. I'm not a extreme prepper, but I've learned a lot about permaculture and storing food from this one. His approach is not the fearmongering, world coming-to-an-end thing many expect from the survival and prep community.

global debt

Debt is slavery. It's simple as that. It's a tool that can be used against individuals on one end of the scale (credit card usury, predatory lending, etc.) to resource-rich but under-developed countries on the other. Historically, third world countries have been manipulated into massive debt schemes to the benefit of oil companies and the overall US corporatocracy.

John Perkins has an excellent primer on global oil debt from the addendum of the Zeitgeist movie. We all need to think about the true costs next time we fill up that tank.

on everyday courage

grieving

I feel like I'm in a constant, steady state of grief these days. So many people are in seriously frightening financial situations. So much of it could have been preventable by common-sense political policy, but corporate and political stupidity and greed keep it growing every day. Things aren't turning around, and they probably won't in my lifetime. See this photo essay on homelessness in the Seattle Times for just a little slice of life.

Jobs, yeah, it's that simple. It all comes down to JOBS. We can not continue to bleed jobs overseas. Our current economic/trade policies are morally and practically wrong and are destroying this country (as well as the lives of those who toil for low wages overseas).

[naive rhetorical question alert] Do politicians and wealthy corporate CEOs truly understand what it's like to not have work? Do they understand how demoralizing this is? Even putting aside the concrete aspects of not having regular income, do they really understand what this does to one's spirit and sense of self worth? Silly question, of course they don't give a damn about the rest of us. Obviously, looking for solutions from Washington has not been the answer. Looking for our corporate "leaders" to do the right thing and start hiring is pointless.

Tent cities, the real estate crash, Detroit, for god's sake. A drive late last night through downtown DC — just blocks from the White House — homeless folks camped out on the sidewalks all over. Nothing new of course, I just felt/hoped that with regime change, some things might have improved. They don't call me the optimist for nothing : )

I have $47 in the bank, utility shut off notices in today's mail and a mortgage due tomorrow. I, for one, am becoming radicalized by my personal situation as well as what I'm seeing around me.

Credit 'repair'

Here's a great offer from another predatory bank. I'm aghast at this, there is no other word. This is an offering for a credit card for folks with 'bad' credit. It will supposedly help them repair their credit rating, which is great, right? Then they can get back onto the American consumerist debt treadmill, provided they don't break their backs paying these incredible fees and 59.9% interest rates.

If you have 'bad credit', you really should think twice about this kind of 'repair'. The hard-sell of the 'necessity' of credit ratings needs some serious examination. When did we get conned into this? It really is possible to just opt out.

Rhetorical, but it needs asking — do we not have usury laws in this country? Can the people who dreamed up this enslavement plan actually sleep at night?

Personally, here on out, I'm not participating in any of this. I have a debit card, but I will never have a credit card again. It's a honey-coated trap, and I've fallen into it before. Never again.

DIY housing

Given the economic collapse we are experiencing in the US, with huge job losses and more and more people losing their homes, there is a need for information about alternative, very low cost temporary and permanent shelter.

With a few tools, a bit of land (which could be cooperatively owned) and a serious attitude shift about what is desirable and acceptable in housing, wonderful shelter can be built for not a lot of money. Consider the yurt —

[photo released under the GNU Free Documentation License]

A yurt is (traditionally) a portable shelter used by nomadic people in Mongolia and other regions. In its original form, it consists of circular, tightly bound lattice walls with a wool felt covering. Roofing is constructed with poles attached to the lattice at the outside edges and a circular ring in the center. The interior space is entirely open, with no load-bearing partitions.

There are hundreds of variations on this basic plan, and dozens of US yurt builders —
Colorado Yurts
Pacific Yurts
Red Sky Shelters portable "Yome"
Laurel Nest Yurts
Blue Ridge Yurts

Although these may look like tents, they are fully capable of withstanding serious weather conditions and can be used year-around in most climates. If you wanted something more "solid" and super-insulated, there are new, innovative prefab construction techniques and kits available —
CircHouse
ICS Solargon, made with SIPS (structural insulated panels)
Smiling Woods panelized yurts

You can buy plans, parts kits, completed kits. It's entirely conceivable that a family of three could live in a 20' yurt (about 310 square feet) with a basic cost of about $8,000. With variations like straw bale or earthship walls, the cost could be even less.

The links above are just a sampling of what's available. The best overall source of information on yurts is here.

a rockin' good song

What an amazing voice he has. Great song, great message.

diversion for a snowy day

Let's play Where in the World! In this case, where in the world are the foreclosures? It will give you a great visual of what's going on in the housing market right now where you live. For a really accurate historical assessment, you'd need to be able to 'dial back' five or six years and do the same search, but by all measures, this is shocking enough.

Go to Google Maps. Type in a state, city or zip code. On the right side of the window, you'll see icons for the search menu. Scroll down and select 'Real Estate', then 'Foreclosures'. Deselect 'For Sale'.

For example, here's a screenshot of the current foreclosures in Kansas City, MO. Each one of those dots represents a lost dream for someone.

Then there's Detroit, one of the hardest-hit cities in the country. 

I'm finding it difficult to wrap my head around the fact that there are houses in Detroit that you can buy for eight dollars. 

I've read that a lot of artists from all over the country are moving in to homestead. That's intriguing to me, as an artist looking for community, but it will take thousands of people to build a safe place out of the some of those areas. The concern for me is the bottom-feeding investors swooping in and buying hundreds of these to rent out and recreate whole neighborhoods of absentee-landlord slums.

Thought for the day

This is one of those great WW2 posters, now in the public domain. History here.

The NEED Act — Jobs Creation

A little something on the larger political sphere from progressive Dennis Kucinich, well worth the time to read.

http://kucinich.house.gov/UploadedFiles/NEED_ACT.pdf

It's a start, and a good one. I read it; I don't get it all, not having any background in ecomonics, but here are my comments and a couple of questions:

There are a lot of aging, disabled and unskilled workers who could not do hands-on heavy construction that seems to be implied as the lion's share of job creation here, so where would they fit in? Would job training be a part of this? Who would be overseeing the jobs creation, ie, doling out of the infrastructure money? Wouldn't this be rife with pork projects? Would that matter?

I can't really address the parts about the Federal Reserve as I just don't know enough to make an intelligent comment, so I'll sit back on that one, and try to educate myself before bloviating.

The big question is, realistically, can it be passed? Can anything positive and progressive ever make it through our government? Our political system seems to be totally in the grip of special interests (corporations), and I can see a lot of objections coming from them.

The US government might maybe be by the people, but it certainly isn't for the people. If something like this fails, what hope is left?

holiday plans!

Yippee! I'm spending Christmas eve, snuggled on the floor by the wood stove reading my new copy of The Foreclosure Survival Guide! Does it get any better than that?

I am truly thankful for what I have had in life. I just wish I could get a job so I could contribute to the economy instead of becoming another foreclosure/homeless statistic, further bringing down the housing market. It's particularly painful, because I put a lot of money down on this house—over 100k—everything I had from the sale of my last house, and it's all going to go away to a bank that has gotten billions in bailouts. Just doesn't seem right.

Live and learn, right? I'd rather not be learning this particular lesson at age 54.

Downsizing. Serious downsizing.

The Tiny House movement is an option to consider if you are looking for a new way to live cheaply.  Personally, I  have long loved the idea of very compact living, and am hoping to sell my house this year and live in a cute vintage trailer or homebuilt gypsy wagon.

The main obstacle (aside from actually selling a house in this very down market) is finding a place to park your home on a semi-permanent basis, so you can enjoy the benefits of, for example, planting a garden, composting, being part of a community.

Many, many communities have restrictions on the size of a house you can build and live in full time — you may build a cabin, but you can't live in it year round. You may not have a trailer on a property for more than 30 days, etc. This is an example of the cultural bias against the poor, as well as those who choose frugality and an anti-consumerist lifestyle. Many trailer parks also have restrictions about the type of trailer you can bring in — some of them won't rent space to "different", vintage, funky, or creative looking trailers.

I think the solution is to find a small group of like minded individuals and buy unrestricted property to build on. Unrestricted land can be a challenge to find, but it is out there. I actually own some myself, and am starting to think that I might just build a small community on it instead of moving. Resources can be shared during the building stage (earth moving equipment, tools), and this scenario is open to the possibility of a large communal garden/orchard, a private dairy, livestock, solar power, wind power and other projects that would be too big and expensive for one family to take on.

Interestingly enough, I've recently read a few accounts of serious bias against full-time job seekers and employees who live in mobile shelter; how individuals were fired when it was found that they lived in trailers. This is just anecdotal right now, but it might be interesting to explore the legal issues.

Resources:

Tumbleweed Tiny House
Tiny House Forum
PBS video on one tiny house

So. Where are the damn jobs, anyway?

I haven't yet found a practical answer to this. It's pointless to get mired in blaming former or current administrations, even though they clearly are to blame. I just want the dialog to move further, and I want to see some real solutions discussed.

I don't understand why the option of a new WPA has never come up. Isn't this what got Americans working during the last depression? Are we so hamstrung by obligations to special interests and corporations that we couldn't make this work? I'm disappointed that President Obama didn't immediately come out with this. But I suppose he knows a politically dangerous solution when he sees one.

The thing is, the fed stimulus money benefits a very small slice of the US workforce. Were we all supposed to go to work building roads? That was what everyone was talking about last year, but doesn't this really just benefit the large construction corporations? And what was all that about "green jobs"? Are we all supposed to retrain and retool to work in the "green sector"? 

We need jobs for the other 90% of workers, and we need them now. It's clear that the private sector is going to hold onto their profits. It's clear that the term "social justice" isn't in the corporate vocabulary. It's up to our elected officials to do something now, before major unrest from the unemployed begins.

Did we all like the Black Friday riots at the Big Boxes? Wait till you see the bread line riots.

Keeping warm

One of the smartest things I've ever done was to install a woodstove in my house.

I live in an 80 year old house with a 50 year old oil furnace. When I first moved in, I had the tank filled. It was $650. I asked the delivery guy how long he thought the oil would last. When he nonchalantly estimated six weeks, I knew that wasn't going to be viable, and went out the next day, armed with cash from the sale of my previous house, to buy the stove. No regrets, going into my fifth heating season.

It is hands-down the least expensive way to provide heat, and it's off-grid, which is a wonderful thing. You don't have to worry about power failures — as long as you can get to the wood pile, you'll be warm. At times last year that was a challenge, as I had to dig through four feet of snow, but hey, it's good exercise, and got me outside to experience the power and beauty of nature.

Last year, in the eastern part of the US we had an amazing amount of snowfall. My area had a total of 101 inches. It was cold. I heated my house for $360. No, not for one month — the entire winter.

'Start-up costs' will vary. My stove was $2200. Installation more than doubled that, but I had to have the brick chimney lined and repaired. Some installations can be just a few hundred dollars; it just depends on where you want your stove to go.

If I was going to do this again, I would emphatically not choose a stove with a catalytic combustor. These are devices that re-burn the particulate matter in smoke as it exits the chimney, thus producing a cleaner burn. They are also more efficient, so you'll use less firewood. However, if you are new to heating with wood, you'll probably ruin your first two before you get the hang of things. They are very fragile, hard to find and expensive to replace (about $200). There isn't a lot of information about how to burn using a catalytic stove.

Best advice — never close the damper until all the moisture has burned out of the wood. Moisture is what "kills" them.

Fuel (wood) is available everywhere, sometimes for free. Stacking a good looking cord of firewood is one of the most satisfying outdoor activities ever on a crisp fall day.

Wood burning also contributes to the local economy, as you get your wood from the guy down the road who cut the trees, split the logs and delivered them, not a huge corporation. All of the guys I've bought from lead economically marginal lives, and I'm happy to directly support the cash economy. Win-win all around.

Being responsible vs. Asian imports

This isn't a post about vilifying China. It's a ramble about failed personal good intentions to be responsible with where my money goes in a larger picture than just "can I afford this".  It's about thinking about how one person's actions fit into the bigger picture of the overall economy, and the zillions of American jobs lost to overseas manufacturing, where workers earn a pittance and have few benefits.

I try to buy American made clothing whenever I can. But when you don't have a lot of money, it's easy to just go to the Big Box and find clothes that you need at a price you can "afford". So recently I refreshed my utilitarian wardrobe with a visit to Target. I didn't even think for a second about checking labels. I went for warm, well made and cheap. And I didn't even think about looking online for "made in the USA".

Now I'm feeling the guilt. I'm a part of the problem, not a part of the solution — a small one, but nontheless, a part of it. In no way will I throw my guilt completely onto the manufacturers who have chosen to close their factories here and outsource, or onto the politicians to made it easy and profitable for them to do so.

It's obvious that we have to bring back our [textile and clothing, just for one] industries to return jobs to US workers, but it will never happen. It's a big economic death spiral — unemployed people can't buy things, factories continue to close, more jobs are lost, the US loses its autonomy. Lack of purchasing power on the individual level weakens the whole economy. It all comes back to JOBS.

And now, a bit of nostalgia. Did you grow up with that ILGWU jingle stuck in your brain? I can still remember every word, though I never really thought about the importance of them until recently.

Jobless recovery? What exactly does that really mean? What idiot invented that term? Discuss among yourselves.

nutrition disparity between economic classes

Great article from Newsweek about the dietary differences between those who can afford good food and those who can't.

I can tell you that in my area, supermarket food is definitely more expensive and of lower quality than what is available in the major metropolitan areas about 100 miles away. In the summer, the farmer's market is a wonderful option, but for six months of the year there aren't a lot of choices other than packaged mass produced foods and imported fruits and vegetables.

Our topic today: Foreclosure

I recently had a foreclosure scare. On the Life Disruption Scale, that's right up there. Not as bad as a cancer scare, and trust me, I do feel fortunate that this is the worst disaster I've been challenged with in the last few years. Due to my small business failure (independent retailer) I was unable to pay my mortgage for about six months, and starting getting foreclosure notices. My house was actually well in the foreclosure process, but thanks to a no-strings loan from a friend (who is a gift from the gods) and some odd jobs, I was able to get back out.

I don't know how long I'll be able to maintain the payments though. I've had a few freelance jobs, and I'm just trying to hold on until spring, when maybe the housing market will pick up and then maybe I can sell it, and maybe walk away with enough cash to buy a trailer and move south. Or maybe I'll have a job soon. Lots of maybe's.

You know those "housing programs" that ostensibly keep homeowners from foreclosure? Sadly, they are smoke and mirrors. If you are in this position you don't qualify for a lower interest rate, which is one of the things that would truly help.

Anyway, I ran across this book today, and will probably pick up a copy. It looks like it has a ton of practical advice.

So, what's your foreclosure story?

Intro

I've been wanting to write this blog for several years. I've also been afraid that writing about living in poverty would be a distraction from trying to rise above it, but I've got a lot to say on the topic, and my experiences might be useful to somebody.

I'll keep it short and sweet — it's a challenge every single day.

I'm not a "welfare queen", whatever that is, though I once got food stamps for 3 months. I live in a rural area, am currently unemployed, have a few medical issues but no health insurance (of course).

Right now, I also have no heat in my house. It's late November, and that means 45º inside the house. That should be remedied soon, when I get the chimney swept, but I didn't have the money to do that till today.

You jobhunting too? It's amazing, isn't it? I'm applying online to just about everything in my field, and I'm willing to relocate anywhere. Nothing has come up yet, but I am —

Ever the Optimist