Archives For April 2009

I’m watching President Obama’s speech right now.

He just talked about taking steps to help Americans gain access to credit so that they can buy cars.

Has auto financing been a problem? Are people who can afford to purchase new cars being denied credit? Don’t people need jobs before they can buy cars?

Are you guys optimistic as to where this country is headed? I’m skeptical (but I’m ALWAYS skeptical).

I noticed Scott Burns’ column in today’s Houston Chronicle (you can read the article here) is the first in a series on reforming retirement saving. This particular article talks about the fact that many employers are no longer offering their employees a 401(k) match. Scott references a study done by Hewitt Associates that states that a one-year suspension in the employer match can cost a young employee (earning $50,000 per year) $16,000 in future retirement benefits. I think this is unfortunate.

This finding from Scott’s piece reminds me of what I pointed out about the 2009 Fortune 500:

In the 12 months ending Feb. 28, only 12 companies in the Standard & Poor’s 500 provided a positive return. Over 200 companies lost at least half their value.

Finally, this last part regarding how fees can really eat into retirement plans, is telling:

All other things being equal— gross return and career contributions — a federal government worker with a virtually cost-free plan who starts saving 6 percent of income at age 30 will accumulate about 10.5 years of final income by age 67.

A private-sector worker with a typical plan will accumulate only 8.5 years of final income by the same age, if the plan has costs of 1 percent a year.

A worker with a plan that costs 2 percent a year will accumulate only 7 years of final income by age 67.

Those are big differences. Put another way, 2 to 3.5 years of income are siphoned off by the costs of typical plans.

I have a feeling that changes are coming… Let’s hope they are for the better and not some kind of socialist program.

I still think education and SELF-DISCIPLINE are the keys. Employees need to understand just what they are giving up when they elect not to sign up for their 401(k). They need to be updated once a year with something that says, “This is what you could have in your account had you signed up.” Of course, this may do nothing more than lull people into doing nothing since they already feel like they missed out.

I’ll try to highlight the other five articles in the series as they become available.

I got an email this morning from Stacey (a frequent reader and commenter here) asking me if I had any recommendations for a laptop computer for her 14-year old son, who will be starting high school this fall. I told her I had no idea but that I would post this as a question of the day. She desires reliability with affordability.

I’m thinking a small Dell would suffice but as I said earlier, I really don’t know. Inexpensive computers (I’m thinking $400 – $600 price range) are out there. It’s the software that makes them expensive.

Any suggestions?

Magazines Are Hurting Too

April 28, 2009

I was in standing the checkout line at Kroger last night and I reached for a Time magazine. I kid you not, the magazine almost felt like a newsletter. I didn’t check the page count but it was extremely thin. The Newsweek sitting next to it was almost as thin. Then I got home and was on the Drudge Report and saw that Conde Naste is ceasing publication of Portfolio, which seems to be a mixture of Vogue and Fortune.

I have a hunch that we are going to see lots of magazines cease publication (at least print editions). There’s simply too many magazines and people are using the internet.

I still subscribe to a few magazines. I like Fortune and Barron’s. I still get Money, Kiplinger’s, and Smart Money but will not be renewing as their subscriptions expire. I just don’t have enough time to keep up with all the different magazines. My wife likes Southern Living, which we’ll probably keep renewing forever. I used to subscribe to GQ but haven’t for the last ten years or so.

One magazine that I LOVED as a kid was The Sporting News. I remember sitting out on the back porch and reading it from cover-to-cover. One of my best childhood memories. They changed their format though and now it sucks.

What magazines do you still subscribe to?

2009 Fortune 500

I had to do a double take when I saw this but check this out:

The 2007 Fortune 500 had total profits of $785,134,700,000.

The 2009 Fortune 500 had total profits of $98,881,100,000.

An 87.4% DECLINE over those two years (I can’t find my 2008 Fortune 500 issue).

Interestingly, the revenues of all 500 companies were up from 2007’s list ($10.7 trillion in 2009 vs. $9.9 trillion in 2007).

The 2007 Fortune 500 saw 43 companies lose money.

The 2009 Fortune 500 saw 126 companies lose money. That means 25% of the 500 companies lost money in 2008.

One other thing I found interesting was how much smaller the actual 2009 Fortune 500 issue was compared to other year’s. This year’s issue was over a hundred pages shorter than the 2007 Fortune 500 (276 pages vs. 386 pages). The 2005 issue was 410 pages.

I read over the weekend that GM was about to announce that it was closing its Pontiac division. Dumping Pontiac will leave GM with Chevy, Cadillac, Buick, GMC, Hummer, Saturn, Saab, and some other foreign companies. There’s talk that Hummer and Saturn are next to get the ax.

I’m not sad that Pontiac is gone. I’m sad that so many people will lose their jobs but I can’t say that I will miss the Pontiac brand. To me, Pontiacs always felt cheap and rattly. I have never owned a Pontiac.

So, what do you think GM will look like when all is said and done? I’m thinking it will be Chevy, Cadillac, Buick, and GMC. I say Buick only because it is a big seller in China. Who knows, they may quit selling Buicks in the states and just sell them in China.

Either way, GM is going to be a much smaller company when this is all said and done.

Remember my rants (here and here) about my Price Pfister kitchen faucet? Well, let me bring you up to speed.

A vice president from Price Pfister must have seen my rant because he sent me an email and apologized for my troubles and offered to send me a new faucet. I accepted and replaced the old parts with the new faucet parts. Well, it would work for a while and then the water pressure would start dropping. I thought the issue was with Price Pfister’s diverter, which is the part that diverts the water from hot to cold and from the faucet to the sprayer. I would change them out and the water would flow fine for a while and then start slowing again.

Well, yesterday I changed the diverter for the third or fourth time in the last year. I turned the water on. It worked fine on cold but when I turned it to hot, the flow almost came to a complete stop. I thought it was the shut-off valve so I disconnected the hose from the valve and noticed what appeared to be sediment. I cleaned it out, put the hose back on and turned it on again. Still no flow. So, I took the hose off again and looked inside the hose. It was absolutely packed with this sediment-looking stuff. So, I cleaned it out, hooked it back up and the water started flowing again. YAHOO!!!!!

Well, last night I was talking to a friend of mine who owns a plumbing company. I asked him if there was a way to keep sediment from getting lodged in my shut off valves. He said, “No, not really. Is it white sediment?” I said yes it was. He then told me that it was my water heater breaking down and sending that stuff through the lines.

As soon as he told me that, I was like, “Oh man…I’ve been bitching about Price Pfister and it turns out that it was my water heater. DAMN!”

Anyway, this is my attempt to apologize to Price Pfister. Please forgive me. I’ll link to this post from the original Price Pfister rant so that people who stumble across the original post will see the correction.

I suppose something I should learn from this is to look at all options first BEFORE you make a judgement. Or, in my case, call a plumber! My plumber friend would have figured it out pretty quickly.