Wise Bread (Jabulani Leffall)

The Law (of) Suits: Insurance for Men

Jabulani Leffall — Thu, 05 Nov 2009 16:00:23 +0000

In this blog, on this site, I usually explore ways to think about spending rather than ways to actually spend. That’s not my blogcallojob (blog calling or job) to tell you how to spend.

But I’d like to pop a sales tag of conversation for fellow men, or women with fellow men in mind, reading this right now and speak plainly. I’m about to tell you how to spend money on something for which the worth cannot be measured.

It brings smiles, impromptu favors, more respect, more enigma, better service, attention — usually the right kind — and did I mention smiles and respect.

Not the automobile — the suit.

Recently I was riding home with a soon-to-be jobless, soon-to-be former colleague. One word: awkward.

But before he dropped me off, I asked where he was headed, and he said to the mall. And, curiously, making my own judgment on what one could be buying when one knows one won’t have a job, I ask, for what?

He says a suit.

A light goes on and I nod because it makes sense. I nod proudly, in fact, at him. I say to myself, smart man. I nod in whimsical favor because he’s thinking about investing in his future rather than moping over his present. I nod because he wants to plunk money down for something that in most cases brings the immediate return of self satisfaction as well as the intangible prospect of being in the right place and the right time, looking darn good.

He mentioned he didn’t want to “over do it” expense wise. Of course I understood that and then proceeded to rattle on about what could be done. I proceeded to monopolize the convo on what the pros and cons were of different aspects of suit procurement.

Suits, I don't remember saying but will say here, are like insurance for the professional and non-professional but skilled American man. They are insurance for the man who wants to make inroads into achievement and stand out with a statement on who he is when wearing that suit.

It’s like a financial plan: better to be impeccably prepared (overdressed) than woefully underdressed (unprepared).

Now let’s say you’ve paid your rent and gotten your groceries and have all your necessities and you’re a grown, able and responsible man with $300 to $500 and are in the market for a suit.

Okay, you’re like my friend. After asking him what he planned to spend, without revealing too much of the young man’s business, I went into a diatribe where I leaned back in the passenger seat and expounded wisdom using the famous pyramid hand gestures that most pseudo experts use on talk shows. This is the essence of what I said.

Suit up premium

Heck yeah: Classic is called classic for a reason. For instance, classic American clothier Brooks Brothers recently harkened us back to the era of smartly-clothed ad executives from the popular television series Mad Men. The classic look remains just that and outlasts any fashion week. Plus the clothes usually last longer and are of better quality.

Uhhh but wait: The issue here is that suits that are tailored to your specifications and/or made of fine fabrics from top labels, usually begin at $400 per suit. Maybe not the extravagant purchase you want to make right now but there are always sales and alternatives. Maybe you’re a forward thinker who sees their world beyond the recession or even sees opportunity in it. Maybe you want to go make an unmistakable statement. But maybe you don’t which brings us to our next alternative.

Suit up quickly and bountifully

Heck yeah: If you happen to live in a place with a population greater than half a million, there should be at least one or two places that have this type of sale: Three suits for “x” amount of dollars in a package. In other words, what you would pay for one Brooks Brothers or discount Italian or English designer suit, you can get three off-brand no-frill wool or down-market fabric suits, which you can freak just right if you have the right style sense.

This is probably the greatest stitch-for-stich value because it gets you through the week and month and maybe even the year and allows you to mix and match if you have a pre-existing and respectable shirt game and at least one good pair of shoes.

Uhhh but wait: You may be sacrificing quality, which is kind of like buying liability without getting uninsured motorist. After four or five trips to dry cleaners, it’s literally a wrap for these types of suits. I’m not talking about the plastic coating to protect them from the elements. I’m talking about fabric thinning and the appearance of nappy lent beads on your suit. There's not an afro-pick or lent brush in the world that can remedy this type of wear and tear. But that brings us to the last alternative.

Suit up without a suit

Heck yeah: If you’re easing into the game or just a novice or a stylish but not a “suit” man, you know how to accessorize on the cheap. Get a really nice blue or black sport coat or blazer, even a gray or solid brown one: or all four if you go to a thrift shop.

I’m talking blazer now chums. This is not to be confused with a suit jacket but an actual coat, which that 9 times out of ten won’t match your pants directly. You can use your style to go for the professorial, business casual look and perhaps hunt Ebay or your local thrift store for “pre-owned” quality coats that will compliment brand new pants. Get brand new pants — don’t be a tightwad on that.

Also if you’re not going to get a full suit, don’t be a tightwad on shirts either. They should be dry cleaned or brand new and if you’re considering your budget, why not buy a shirt that no one else has from a site such as ShirtsMyway.com. This site claims to have 7 trillion different designs. With that many variations, you will have your own style and through bulk save money by not having to go to the mall and be bilked by someone trying to get a commission. You design it and you order it. No plug here as I don’t own a single shirt from that site but I like the idea and am considering it.

Back to the stand-alone blazers. Save on the coats, up the quotient on the pants and shirt and it’s the cheaper, less high-maintenance alternative. You can wear them with ties or with an open-collared dress shirt and maybe just maybe on rare occasions throw it on with jeans and sneakers if you believe you can pull it off. Or if you believe you can wear a straight face if you don’t pull it off.

Uhhh but wait: You should be able to pull this off if you want to earmark this as a professional style. Remember, it’s not a suit and shouldn’t be carried off as one. If the pants are the same color as the jacket, please let them be close to the same fabric and if not, know your ledge. Shiny silk blazer and corduroy pants might get you unemployed as fast as the trickle-down effect of your company’s falling earnings. Corduroy and silk pants might get you beat up or laughed at so hard you feel like you’re getting beat up. Double polyester — let’s not discuss that.

Why are you still reading this? Go get a suit, no okay wait…look. This is mostly tongue and cheek and there are bigger issues in the world I know, but at the same time, if you’re a professional or professional aspirant between 25 and 50 years of age, you should own a suit.

If you are not independently wealthy through some sort of athletic ability, pop song, technological innovation or government defense contract — in which case you might wear a lot of Hawaiian shirts and khaki — you need to have at least one dark blue or black suit.

If not, you ought to be thinking of a good mix of what was described up here. Are you a grown man or what?

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Recession Journal VI: It's OVER!!!!!!!!!!!! Any Questions?

Jabulani Leffall — Sat, 31 Oct 2009 16:00:04 +0000

By Jabulani Leffall

Are people grabbing strangers in the street and kissing them yet?

Do you see the quivering, multi-colored ticker tape floating in the wind? How about the pitter-pat of feet toward the mall?

Are the talking heads flailing their arms with tales of you winning and the terrorists losing with your purchase of a new smart phone or a plasma television?

Are you happy now?

I ask these things because it’s finally over, technically, officially — the recession is over.

The latest U.S. Commerce Department figures reveal that America's economy grew at a 3.5% pace in the third quarter, beating economist expectations and turning in the best growth numbers in two years.

For any of those still feeling the personal blues and responding to this jargon with a resounding ‘whaaaaa,’ any positive gross domestic product growth after consecutive quarters of contraction or negative GDP, signals a technical, if not literal, end to the recession.

In this case, the latest GDP figures ended four straight quarters of negative GDP growth.

Indeed a relatively bullish equity market — with duller horns than recent years but still bullish — and respectably performing bond market, along with government stimuli and small surges in consumer cars and home purchases, is responsible for the growth.

So I’m checking in with you, how do you feel? Feel good? Okay, you sitting down?

Good.

Well here’s what our "post-recession" looks like right now.

In the same week that good GDP data pulled the United States out of a recession, there's also mixed to bad news where other economic indicators are concerned.

For one, consumer confidence is down.

I asked you how you were feeling, how come you didn’t tell me?

The so called "current conditions" indicator from the Conference Board, which was also recently released, fell to 20.7, and is near its lowest level in 26 years.

This is due to the continually lackluster labor market, where the current jobless rate of just under 10% — 9.8% to be exact — is the highest since 1983.

Okay I know that sucks, but are you comfortable?

Apropos, the ABC Consumer Comfort Index, also recently dropped on investors like it’s hot, indicates that consumers are as uncomfortable about current conditions and about spending as they were during peak levels in discomfort this summer.

And of course, we found out, in that same fateful week that consumer spending had nosedived in September by the largest amount in nine months. And incomes, to say nothing of disposable incomes, were flat across the board.

Still happy?

No, no, sit down, this’ll only take a bit longer. Cop a squat.

Further — yes this came out the same exact week too — while the S&P/Case-Shiller home-price index climbed 1% from the prior month, seasonally adjusted, after a 1.2% increase in July, sales of new U.S. homes unexpectedly fell in September.

The fall of home sales points to fear about lingering foreclosures and the end of tax credits for home buyers that could hamper a housing industry recovery.

Speaking of foreclosures, the U.S. Census Bureau — yes recently they said this — the number of vacant properties, including foreclosures, residences for sale and vacation homes, rose from 18.4 million a year earlier.

Meanwhile durable goods orders are up, but continued high unemployment looms in the shadows, as does the potential for a wild correction in commercial real estate.

Additionally, buried in the basement of the Commerce Department's glowing is data that reveals the inflation-adjusted disposable personal income of consumers falling fell 3.4%, almost the same percentage of positive GDP growth.

Don’t get mad at me, I’m just being real.

Okay, put the torches and pitchforks down. I repeat, we are officially out of a recession folks.

But the long-term effects of new or amended spending habits, our country’s personal and government debt and how we respond now that we’re out, will determine our personal and collective future.

Do you plan to get out there and make something happen? Do you plan to wait until the coast is clear? How has your philosophy changed, if at all?

I know, I know, more questions but as Ken Mayland, president of ClearView Economics pointed out to me in a, to belabor the point, “recent” conversation, “questions are all we have in the present.”

And the more we ask of our government and ourselves where fiscal and personal decisions are concerned, the more answers we have.

This post was included in the Carnival of Money Hackers.

Permalink | 35 comments | Jabulani Leffall's blog | Channel: Consumer Affairs

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Recession Journal V: Mind, The GAP

Jabulani Leffall — Wed, 14 Oct 2009 15:00:11 +0000

By Jabulani Leffall

Ours is a society of self-actualization, both real and imagined. There are best-selling books and rich-to-death gurus who peddle “secrets,” visualizations and the fostering and eliciting of new mind sets for individual transformation.

Some self-improvers go so far as to cut pictures out of a magazine and put them on a cork or “vision board,” so that they can attain the perfect house, husband, life career position, amount of money and bliss.

There something to this even for the sharpest of cynics. So much of how we perceive what we read, see and hear everyday about market fundamentals and economic determinants is based on sentiment.

This begs the question: can we think our way out of this recession as corporate citizens and collective consumers?

Recently, on a late-night, three-episode bender, watching a new network show via the Internet — I don’t own a television and thus am saving some wise friggin’ bread with no cable bill every month — I noticed that many of the advertisements had common themes: either compassion, nostalgia for affordable quality or upbeat sentiments.

Saturn for instance, knows it’s hard out there. Northwest Mutual Insurance says anyone can be strong once but can you be strong over the long haul, or something to that effect, after which it brags on its investment track record. Charles Schwab offers more “bang for less buck.” Chucky you naughty, frugal boy.

Apropos of this pattern, a couple days later, I noticed this story in the New York Times about the rose-colored specs of advertisers. Apparently Bank of America, despite the fact that its CEO just quit, says in a new ad that “America is growing stronger everyday.” General Electric, itching to offload its media properties to focus on industry and having made job cuts, according to the report, has an ad showing GE workers who still have jobs, working. Levi Strauss & Company has hearkened back to its frontier-era roots and is biting Walt Whitman’s funky rhyme style to sell us jeans with a pioneer theme.

The power of suggestion is at play here as it always is but people forget that advertising is media too, the most powerful media some would argue. After seeing images of recession over and over and over again, after hearing about the weakness of the dollar and the rise of China and India, perhaps seeing a well done skit about new loans at Bank of America, a heart string pulling story about manifest destiny or an everyman’s journey to financial freedom will change…our minds.

The study of the mind, psychology, is a more exact science in determining out attitudes toward money than say economics or even the behavioral and environment-driven discipline of sociology.

True enough, our everyday spending decisions are based on the economics of our lives and our given realities and also based on our social strata, but ultimately attitude, mind state, is what makes us put those dollars down.

I’m hungry for that particular thing. That’s a cute sweater that I can only get here. I think I need a new TV. When I get some money I think I’m going to buy that. If I had the money I think I’d buy that. Or, you know, I think I feel good about this purchase. I think this is great.

These are thoughts that go through billions of consumers heads in some variation or another every single day and in more advanced or to use a more apt term, commercial societies, these thoughts are tapped into by advertisers almost non-stop.

So if advertisers reflect good times, promise good times or keep bombarding us with promises of good times to come or regale us with thin and thick veiled slices of Americana, perhaps things will turn around.

I know with Christmas coming up, nothing makes one feel better like buying a good gift, feeling worth something, seeing a smile on their child or love one’s face. Wouldn’t it be interesting to see if there was, despite a downward forecast from the National Retail Federation, some kind of yuletide shopping rally that shocked everyone and got everyone back into the malls.

This is not likely to happen and there would be no real lesson for us if a turnaround led to a return to consumerism that made banks, apparel companies and industrial firms even happier than their ads, but the mind is a powerful emitter of hope, creator of purpose. But the mind can also, in the words of Rick James for what he said about cocaine, be a “helluva” drug when thoughts based on delusion and forced euphoria — the kind that tells us these shoes will make us feel better.

Think once, think twice, think about this.

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Recession Journal Part IV: The Double-Dip Trip

Jabulani Leffall — Fri, 11 Sep 2009 15:04:09 +0000

By Jabulani Leffall

Have you ever been broke as Jack's magic beans?

You know, broke as when said beans dropped on the floor because he brought home magic beans instead of food?

Have you ever been that hard up for cash but anticipating a reprieve?

Oh you have.

Okay, well, do you remember how you felt when that direct deposit finally hit or you heard that the check really was in the mail? You felt better right?

Do you remember the euphoria of going from broke to liquid, if only temporarily, and did the money start to burn holes in your pockets on account of you spending it already in your mind before you withdrew cash, wrote a check or swiped a card?

If you're familiar with these questions and can answer them honestly then you are a living breathing symbol of the economies of 1980-83 and 2007-2010.

Let me explain. For the past 18 months or so, most of us have "felt," broke, if only broken in spirit by the slew of continual bad news. In point of fact a great number of us were even broke literally if we or someone on whom we depended loss their job or home.

But now, oh but now folks, we have a potential reprieve — that's the good news. As of the start of September, everything from consumer confidence and expenditures, oil prices, retail sales and industrial output capacity is moving in a positive direction.

Financial market indices, as a result are up, buoyed by the psychological boosts these numbers bring. The S&P 500 index, for instance, hit an 11-month high the week of September 7, 2009.

And even the one down arrow is shaping out to garner a big thumbs-up as a recently-released Labor Department jobless claims last week fell to the lowest level since July.

But should we start spending in our minds now? Should we stimulate the economy and not let the terrorists win now?

Well that's up for debate but the truth is that we still don't know if a lift out of our lovely recession will be a “V” recovery for victory over being broke as beans or a ‘W” recovery — as in wait and see because we’re not out of the woods yet. Who knows, maybe we might even be in for a VW recovery. Wouldn't that bug you out. Marinate and then laugh if you care to.

So my good people, the "VW" or just "W" recovery, represents an up-down-then-up again recessionary trajectory, one that despite current indicators could be in the offing.

What to do?

Well, in a cursory web search using the search terms "Double-Dip Recession," I found Richard Marcus, associate professor of managerial economics and finance at the University of Wisconsin-Milwaukee and I knew that school was in.

And I knew that he has a handle on such things as money and the like. And I knew that he would likely pick up the phone himself and given the often genteel mannerisms of fly-over state residents, I knew he would actually talk to me if I explained who I was and why I was calling and that his work would help further an eventual point that I would be getting to.

Dr. Marcus likens the current economic situation to the extended double-dip recessionary period of 1980 to 1983. Back then, as it is now, there was major government spending and the recession was exacerbated by a severe credit crunch as well as monetary policy from the Federal Reserve that made the downturn more protracted.

Over static on my cell, Marcus posited that if forecasters are to use history as a guide, the 1980-83 downticks turned around with sustained spending, a tax cut and more “helpful monetary policy” and that nowadays if we want sustained change we should act accordingly.

Marcus says that while there is every indication that the current recession will soon be over, this economy is sort of like a swimmer underwater that comes up from air and then goes below again, only to come back up.

I like that he used wide-open metaphors that could apply to dips. He was doing my bidding (insert cartoon villain laugh here).

“I’d said before that I thought there’d be some upturn but I also said that the period 2007 to 2010, will likely take as long to right itself as that time in the 1980s,” Marcus told me. “This is because you have a tax increase that will kick in to slow the economy and eventually even $800 billion in stimulus money will teeter out. Plus the Federal Reserve has doubled the monetary base and they have to be more restrictive.”

Indeed despite positive economic data, the government’s current fiscal and monetary bend and that of the early 80s are two sides of the same coin in that policies in both eras seem, as Marcus puts it, “contractionary in nature.” Plus Marcus added that he expects overall unemployment to continue to rise, “likely going to 10 percent or above before it’s all over.”

And now back to you folks. How do you feel? Do you feel confident? Are you ready to pick up those broken beans and throw caution to the wind, take some risks, buy some goods, services or memories?

Or are you forever changed due to the emerging consumer ethos of frugality, caution and selectivity as the country emerges from the most pervasive downturn since the Great Depression?

<>Well consider the thoughts of yet another economist, Nouriel Roubini, from NYU, whom I probably could not have reached by phone to talk to in a short period of time even if I had one of those long-reaching thingamobobs that grab objects even while you're sitting down.

Roubini is known in many circles as “Doctor Doom,” and he has said that going forward, even if the recession ends, there might not be enough spending in this or other countries to offset the wicked drop in consumer demand from "over spenders" in the United States and Britain.

Yes the U.S. and U.K., which in recent years have become both home to some of the world’s most conspicuously consuming people, and also two of the countries hit hardest by all this crunchy credit.

So if you're thinking that a turnaround is here and your money is burning a hole in your pocket and you want to spend as you did in headier times, think again, double dip yourself before you trip yourself.

Whether the recession is finally over or not, remember when you were broke as a bean and remember how you felt.

Permalink | 13 comments | Jabulani Leffall's blog | Channel: Consumer Affairs

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Recession Journal Part III: How Low Can We Go and When Will We Get There?

Jabulani Leffall — Fri, 31 Jul 2009 12:00:11 +0000

By Jabulani Leffall

As a business blogger, high-finance business journalist, business man and one who minds his business – who pretends to know what he's talking about – I pretty much always answer "stay in bonds," when called upon for investment advice.

I hate giving it so I don't. I tend to just pose more questions, as I do in all discourse, objectively presenting many sides of the equation. So people can make up their own minds

After all there are two sides to every story and then there's the truth.

So I thought I'd utilize the ever-changing world of telecommunications, in a figurative sense of course, to try to get at the most pressing question these days: when will this crappy economy turn up?

The answer is, well, when it bottoms out.

But when is that?

Hold on let me check (ring ring).

Hello economic bottom? Economists and forecasters called and left a message, again.

They said they’re still looking for you and you’re still hard to find.

Therefore indicators for recovery from and continued length of the current recession remain inconclusive.

They also said, "We hope to see you soon because you’re neither here nor there."

Indeed, the more economic information that comes out, the more guesswork there is. As of July 17, jobless claims are up to 554,000 – a sum that is less than June numbers but still up versus 524,000 in the previous week, according to FactSet Economics.

Also as of June, the national civilian unemployment rate rose to 9.5%, the highest it’s been year-to-date and average hourly wages are also down compared to last year and last month. Additionally Federal government debt is up to $11.5 trillion as of the end of June opposed to $11.3 trillion at the end of May.

Yet there are a few bright spots. Home sales, building permits and monetary supply, through historically low interest rates, are all up.

So now we can breathe a little bit right?

Well, not so much. Those figures are up while consumer confidence and industrial production output, as of the end of last month, are still down.

Why the disparity among all the leading indicators? And what does a stoppage of declining figures mean vis-à-vis inclining figures in the future?

Enter the Federal Reserve, which this week released its Beige Book survey to arrive at forecasts based on statistical and anecdotal economic evidence. In the report, the Fed said that most of its 12 regional bank districts are seeing a slower pace of economic decline for the months of June and July but didn’t go so far as to predict a turn around.

To the glass-half-full soothsayers, this comes as an early sign that the worst of the worst economic doldrums since the Great Depression is closer to coming to a halt and that thereafter an ascent of the proverbial bar graph of growth will emerge once again.

Such are the sentiments Fed chairman Ben Bernanke, who, despite seeing personal his assets take a 30% decline in 2008, is bullish on the broader economy.

Bernanke recently told Congress that the economy’s contraction “appears to have slowed significantly,” with demand and production showing “tentative signs of stabilization.”

He echoes other policy makers such as New York Fed Chief William Dudley, who predicted that a modest recovery in housing activity and car sales coupled with fiscal stimuli from the government would give the U.S. economy moderate growth in the second half of this year.

Then in the same speech this week, Dudley turned around and said "the balance of risks is still tilted toward weakness in growth and employment and not toward higher inflation."

The only grain of certainty to be gleaned from cautiously optimistic policy makers and from the Beige Book is that neither provides any tangible signs of outright growth.

For instance the Beige Book found that retail demand was “sluggish” in most areas, and that auto sales were “mixed.” Manufacturing was “subdued, yet slightly more positive.” Meanwhile, according to the survey, non-financial services businesses are “largely negative with a few bright spots.”

Yeah that's clearly the sign of recovery right? (Pshhaw!)

Lastly, the most telling indicator, bank lending, “was stable or weakened further” in most loan categories across all 12 Fed districts, with tightened credit standards in at least seven districts. It looks like finding that elusive V-shaped recovery as it relates to the current economic downturn is going to take a bit longer, despite some sporadic cheerleading and sparsely positive numbers.

Plus one must take into consideration that financial firms are still digging out of holes, which means credit will remain tight and in Dudley’s words, for the near-term still “limit the pace of the recovery."

Suffice it to say, policymakers, analysts, investment managers and consumers will all be calling again next week, next month and perhaps even next year, looking for you, economic bottom.

Are you still there?

Well folks it's not there right now, act accordingly.

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Latvians Mortgage Their Souls For Cash

Jabulani Leffall — Thu, 09 Jul 2009 12:00:03 +0000

By Jabulani Leffall

Anybody tired of hearing about personal, local and national budget crises? Would you like to step outside your personal sphere and just for a moment play the “relativity” card? That is where you are relative to others less fortunate. Are you feeling international?

Well, here’s the latest finance news out Eastern Europe, the Baltic republic of Latvia to be exact: their economy is cluster-bombed too.

Like the U.S., Latvia’s government is attempting to prop up its banks with savior capital and putting up cash for consumers who may be in heavy hock to local banks. Latvia’s version of economic stimulus plan could cost up to $80 million annually according to the Latvian parliament. That amounts to perhaps one year of compensation for Richard Fuld, of the erstwhile and now failed bulge bracket investment bank Lehman Brothers but that’s just for context.

Much like the U.S., property values in Latvia are plummeting and unemployment levels are hitting double digits as delinquent loan balances rise.

But here’s where Latvia takes a sharp left: People there are selling their souls for cash.

Not figuratively as some Americans do with payday and subprime or auto tile loans or crime or retail therapy as a spiritual and emotional analgesic -- but literally some Latvians are selling their souls.

This isn’t a misprint, a typo or a joke. As of this week more than 200 people have have signed away their immortal spirits for as little as $100 and as much as $1,000, according to Viktors Mirosichenko, proprietor of, shall we say, boutique Latvian finance house Kontona.

Whether the result of atheism or sheer desperation, people are putting up their intangible, unseen essence to get a little cushion coin. This despite the fact interest rates on the 90-day loans are as elevated as 1% a day.

Here’s what’s in the fine print of Kontona's (clearing throat) consumer finance package.

I, the undersigned do hereby take the loan from the Creditor under the known-to-me terms and conditions on the security of my immaterial intelligence, i.e. immortal soul. I also do hereby certify that the said bail is the property of the undersigned and is not promised to anyone,'

I repeat, this is not a hoax but is something straight out of the Faustian Bargain, a deal with darkness and avarice, fear and loathing, a deal for that which puts one above animals.

It was the French philosopher Alexis De Tocqueville, who in the 19th century posited that human beings make a “Faustian bargain” when “buying into the promise of material wealth and well being ahead of principle.”

This whole Latvian episode is whimsical albeit disturbingly so. It raises a greater question on the role that debt plays in our lives. Granted the Latvians that did take these loans out are thinking about the here and now and can buy back their spirits in 90 days at interest and it’s not like Kontona’s collection agency is going to call and say, “I going to need to margin call on that soul, I’m sending the repo man to come pick that up.”

That said, it makes me wonder what my threshold would be, what our threshold would be, what we would do in a desperate situation such as the ones these Latvians found themselves in. This is definitely a quandary that one cannot handicap unless starving, cannot say we wouldn’t do until it’s us.

Yet most in modern society will die with some kind of debt and events like these make one think about what’s important and why being responsible with money and refocusing attention on buying experience and time instead of things is of the utmost relevance.

It’s cut and dry. Your money or your life? Can you bring your wants and desires into parity with your well being, your self worth and esteem, your identity? Or will credit and debt have your nose needing skin grafts from putting it to the grindstone day after day to pay off an engagement ring. Or a flat screen or shoes or a car that loses value as soon as you put your blinkers on to turn out of the dealership. Or that house, whose floors echo with emptiness, tangible and otherwise, as you lift boxes and other things to depart because you can no longer afford it?

Chances are you won’t be putting your soul up as collateral for anything, anytime soon and this is the hope but on a larger level, have you compromised self to play catch up on a bill, to buy something you knew you shouldn’t? Have you indebted yourself to pay off an existing debt? Do you have a live-for-today-tomorrow-is-not-promised mentality and does that inform reckless monetary decision making?

Here’s what a man who works for Kontona and calls himself “Vesti Segodnya” said of the doomsday loans: “Business is business. We give people palpable cash. If a man values his soul, he’ll definitely pay back the credit. I guess, it’s all fair. Everyone can decide for himself, what’s more important.”
Indeed.

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Not Taking Jack: How To Deal With Identity Theft

Jabulani Leffall — Sun, 21 Jun 2009 08:53:46 +0000

By Jabulani Leffall

There's exists a saying that by the way hasn't been independently verified as coming from the Chinese: May you live in interesting times. I say: May I please catch a friggin’ break! Thus it is the subject of “May,” that will be the prominent theme in this post as I’ve been temporarily financially hobbled by anonymous jack moves in the month of May for the second consecutive year. Yes they got me again.

Last May, someone on a commuter bus in Costa Rica hit me for a laptop, a phone DVD and the leather case that carried all this items.

Last month someone went on a spree at Best Buy and Target in San Jose, which I haven’t been to in more than a decade, using my credit card, which – get this – was in my pocket the whole time in Los Angeles and other places that were not San Jose.

Nevertheless, there they were, procuring retail fare from these big-box stores. They even added insult to injury and I footed the bill for their trip on the BART train afterwards. They probably laughed and frolicked on the train with their plastic bags full of goodies.

Meanwhile I am currently trying to corral all the stakeholders – merchants, security staff, police reports and such - to work with my bank so I can get all of these funds back. This is a big pain but that’s a whole other post.

Now, so that your months of May, as it were, don’t turn into June gloom, here is my list of two major themes to consider when pondering reacting against and deterring identity theft.

Because in an era where many people are broke at a level not seen since my late grandmother caught snow flakes in a pan to make vanilla ice cream – in the depression era and beyond Granny Sam added milk, ice and vanilla extract, my mom said it was delish – people tend to steal things and you should be prepared.

Do the “after”math

Usually there’s no way to know what to do until it happens and you have to react. If someone takes over your card like they did with me, you may not find out until days or months later when you’re ordering a pizza and have to have that awkward “sorry-I-need-to-go-to-an-ATM-please-hold-my-ID,” speech with a skeptical waitress.

If you haven’t already taken preventative measures, you need to calm down and act immediately. If it’s a debit card, as painful as it may be, turn it off post haste, clear out your account, and/or transfer funds and shut it off pending an investigation. Some banks won’t even let you recover funds until your card is blocked or deactivated anyway.

If it’s a credit card, recovery is usually more forthcoming but theft can nonetheless haunt you anyway. Contact credit reporting bureaus immediately and get a free credit report from AnnualCreditReport.com. Some services such as CreditReport.com even boast a notifying service that let you know when substantial charges appear on your credit report. A good start for this would be use a credit monitoring service such as CreditWatch for 24/7 monitoring of your credit report.

Secure your PC

E-commerce is here to stay and in some areas, such as banking and specialty retailing, it may even some day supplant actual physical transactions at tangibly-touched locations. When it comes to making your hardware, software and web surfing a safe bet, preventative measures can sometimes be just as effective as or even more effective than detecting fraud. First tip: don’t get your laptop stolen and you can increase the chances of this by not leaving it unattended. Second-tip, secure and/or frequently refresh your cookies – the mechanism that saves your passwords and sign-in info - using Internet options in Windows.

Also opt for a Windows sign in when you first boot your PC so no one can just walk up and snoop. By the way, if you’re at an airport or a coffee shop, try, if you can to sit with your back to the wall whenever possible and watch out for nosey “shoulder surfers.” Third, as much of a racket as antivirus software can sometimes be, get some from a reputable vendor with a good support staff.

A common thing for credit card number thieves and their hacker cohorts to do is dump malware on your PC after you’ve clicked on a malicious webpage that was supposedly on a trusted Web Site. Sometimes they even extort you into buying off-brand AV software just to clean your system. They figure you might be embarrassed so you do it to prevent the Geek Squad or Computer Store technician from gouging you by doing a sweep of your system and installing AV software, something that can cost as much as 400 smackaroos.

That’s why this is a smart play by enterprising hackers because the Joseph Heller of it all is that if you don’t buy the thief’s AV software you’re going to pay anyway. If you do get extorted though, the thief not only has your money for their bait and switch software but they also now have, what’s called personally identifiable information (PII), which includes credit card info, that can be used to create fake “cop-and-drop” cards, which I suspect was done at Target and Best Buy, using my number for just one day of devil-may-care purchases. In a cop-and-drop situation, the miscreant knows that someone will get wind of it soon so they “spreed up” and then get in the wind themselves.

Lastly if and when you switch computers wipe all data off your old joint. A good flash drive should do the trick.

Hopefully thinking about these things will help some of you from getting your physical stuff and/or personal info and hard-earned loot cuffed, leaving you with the arduous task of finding ways to use “month-puns” to hide your sorrows from the world when violated.

For 2010, I’m taking some of my own advice and also crossing my fingers with lessons learned and vigilant eyes and ears.

Permalink | 6 comments | Jabulani Leffall's blog | Channel: Credit Cards

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Conspicuous Spending: Fading to Black

Jabulani Leffall — Thu, 30 Apr 2009 06:07:00 +0000

By Jabulani Leffall

“Consumption is evidence of wealth, and thus becomes honorific, and…failure to consume a mark of demerit.”

--Thorstein B. Veblen, The Theory of The Leisure Class

Alligator-skin shoes: $200. Candy-painted El Camino, sitting on gold Daytona rims with a ludicrous sound system and hydraulic lifts: $75,000. Chinchilla fur coat, even though it’s California: $600. Being a local celebrity – you know where I’m taking this – priceless.

I didn't buy this. I've never purchased these things. God no. This is what I saw growing up on different occasions. And the allure of it all seemed priceless, against logic, against better judgment, but priceless nonetheless. At least it was priceless to me back then before I found out that a PE ratio wasn’t how many times I played hooky versus dressing to play flag football at school. This was also prior to me coming to learn that a mutual fund wasn’t two friends throwing in $2.50 each on a value meal.

According to data compiled recently by essayist and retired patent attorney Richard Everett, African Americans are projected to have spending power of approximately $1 trillion a year by 2010. That will be a significant increase over the roughly $800 billion Blacks are believed to have spent in 2006.

Point is, without caring where it’s going and sometimes where it comes from, many Americans in general and black Americans in particular -- and on the whole -- tend to spend a lot. This is an anecdotally and statistically verifiable fact from the poorest end of the strata to the most affluent. I make light of this situation because I come from it. I come from neighborhoods where I and millions of other youth were reared.

In these enclaves there were no doctors, no lawyers and no financial consultants. There were only hustlers, gangsters and of course the occasional working-class 9-to-5er or blue collar worker who, through conspicuous consumption, was attempting to emulate the look, vibe and aura of the ghetto-rich. This was and is our own version of the “Joneses.”

There seems to be a sense in the black community and it seems in the community at large that possession is nine-tenths of self-worth.

An August 2007 study by Kerwin Charles, Erik Hurst and Nikolai Roussanov at the university of Chicago found that “a large body of anecdotal evidence suggests that Blacks devote a larger share of their overall expenditure to consumption items that are readily visible to outside observers than do whites. Automobiles, clothing, and jewelry are examples of these forms of "visible" consumption.” It also found that whites with the same incomes consume equal or more from a real cost perspective, although the items are less visible.

I should have known better right? I had a great example because my mother drove an orange 72 VW Super Beatle for the better part of a decade and made me “earn” the things I wanted through incentivized programs such as “chores” and “doing well in school,” imagine that?

But outside was a different story. Then as it sometimes is now, the mentality is “get it now,” “get it fast,” “got it … good” -- just get it. This was the consumer ethos of a black child growing up in the 1980s when Air Jordan shoes were, literally to die for.

Author and social critic Bill Mackibben pointed out also in 2007 through his research that money buys happiness right up to about $10,000 income per capita globally on an aggregate basis. Presumably because one is happy not to be starving. Anything other than that, he asserts, is just buying things. In our country we usually buy “things” in a situation when short-term impulse diverges and falls out of cadence with long-term thinking.

I’m at once loathed and relieved to admit that what I brought out of my childhood as I moved up the educational and social strata was the emotional baggage of not having. Yep, I retained the pathos rather than remembering the goal-laden, gold-starred chart on the back of my apartment door that allowed me to think methodically about what my goals were. Only through hindsight do I learn the lessons from being a kid about the chart that allowed me to arrive at the rationalization that my purchasing journey was more important than my destination, the car I drove to get to my destination and for that matter what I was wearing when I arrived. Consumption charts anyone? Why not reward yourself when you actually deserve it and have reached a savings goal? This seems like something worth doing if we must buy that which we don't really need but really enjoy. Earn it.

I look at these spending patterns approaching astronomical numbers and of course there are aberrations in my community, as well as the larger American community, of people who are frugal and save. But $1 trillion in purchases right up through a recession by a group that is less than 5% of the American populous is an alarming figure for all of us, especially when there aren’t that many similar studies for fragmented groups of whites. This means that if 5% of America is collectively spending $1 trillion by next year, despite a downturn, then look for the savings rates! No really, look out for them because they are so low that we hardly know they exist.

As I look at these numbers, I’m reminded that anything I can wear or sit on is not a long term asset. I’m reminded that it isn’t the mink coats and souped up cars that kill you but the small stuff: premium channels you don’t watch, accessories to clothes you don’t need, small repetitive expenditures over time like morning coffee, eating out, renting a movie, taking it home, putting it down and hitting the Cineplex anyway.

As I look at these numbers, I simultaneously reminisce and peer forward as I think about credit and how it encourages immediate gratification. If you don’t have it, why buy it?

And while I cringe at these numbers and think about all of the sociological, psychological and political origins of why some of my people spend this way, I am reminded that the color of money is not black or white but green and green is associated with growth. From a monetary perspective, none of us will ever grow – wealth or otherwise – through conspicuous consumption.

Now if you would excuse me, I have to return this mink coat, it will be summer soon.

Permalink | 24 comments | Jabulani Leffall's blog | Channel: Personal Finance, Consumer Affairs

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Fresh Mint: 'Recession-proof' ideas make good business

Jabulani Leffall — Tue, 17 Mar 2009 04:05:33 +0000

By Jabulani Leffall

Listen closely to what am I saying? That's right, you can’t hear me. Okay, read closely if you can. What you are about to see is more rare than a Cardinal lighting upon a dimming light post in the South Bronx. That would be me shilling for any financial product or service, much less bigging-up an Internet destination that could divert traffic away from myself and my wisebread.com companeros. But it’s time to dispense props to Mint.com, which just logged-on its millionth user (Ol’ boy in the picture – not me of course - is grinning ‘cuz ol’ boy is ‘bout to get Riyyyyyyyyyyatttch). Now back up where you stand or in this case sit, as you read this. I’m not just a flag-sock hack, going with the direction of the wind and propping up success. I did some investigating and this site can indeed be a welcome respite from the convoluted madness of Excel sheets, the banality and antiquity that is Quicken (Software in a box is going the way of the Capri pant) and the general headache of brick and mortar budgeting. Folks, I’m not going back on my word about the tabbed binder because you still need that nuclear option. On the other hand, Mint lets you consolidate everything and if you’re bogged down by both busy-ness and business, this might be a viable option since retail banking isn’t the most pleasant experience and shopping malls have horrible parking and as they become increasingly cavernous, move into parity with specialty and electronic retailing as preferred spending options. That said, it would make sense to be able to look at bank balances, credit cards, assets, credits, debits, liabilities and monthly budgets in one place at anytime day or night. Because let’s face it, some of us don’t even do that in six or seven places. If you still think I’m selling wolf tickets, in a year in and a half the site has tracked more than $50 billion in transactions or to put it another way, one day’s pay from the government to AIG. It also professes to have saved its users more than a collective $100 million. Either way, it’s a solid thing to try out if you’re reading this right now and you want to try something different and you’re tech savvy or you just need something to talk about. As far as security is concerned, the site counts Verisign and MacAfee, transaction security and malware repellent companies respectively, are partners to the site. I’m really pointing this out to drive home the point of self-evaluation and accountability as a journalist/hack/personal finance “haikuist” and Hip-Hop John Henry would do. It’s marinating I know. Okay now as you try to re-focus after just having your mind blown, understand that this one-stop-shop site – I’m talking about Mint as well wisebreaders – can help keep you honest. Not only that, it can force you to sit down and face the truth about what you may or may not need, or more important, what you may not even know you’re losing. Take a look. It ain’t going to make you richer or broker but it might get you to thinking. And if that happens, uh-oh check your pulse because you may be morphing into a money-saving machine. Boo-ya! *Disclaimer: Jabulani Leffall, monetary gadfly, doesn’t endorse nor have a personal stake in Mint.com and remains a loyal humble servant to wisebreaders. Jabulani Leffall will not benefit financially, personally, emotionally or spiritually from increasing unique users on another site and putting more money into someone else’s pocket. Jabulani Leffall is void where prohibited and not currently available in NY, MO, SD, ND, Del., NJ and the Democratic Republic of Congo. Thank God this blog is not subject to credit approval. Jabulani Leffall will not ask where the money came from if someone were to CHAC (Cut him a check) for no reason.

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The Gettin'-Baptized-in-the-Watah Epiphany

Jabulani Leffall — Tue, 03 Mar 2009 01:01:10 +0000

By Jabulani Leffall

As of this writing, it is day eight of a 40-day fast where I will only drink water. But hold up now, I know what you’re thinking, it’s not me just drinking water and not eating. That would be stupid, unhealthy and I would end up suplexing someone who doesn’t deserve to be suplexed. Yes suplex. That’s index, figure to the belt-loop, lift and flip a person because not eating is not good. No, I have for this period – which happens to coincide with Lent but that is not the cause of the endeavor – decided that I will not eat excessively and I will forego all of the lovely liquid trappings of our modern world. Ah the bitter-sweet, absolutely nothing taste of fresh H2o! The sweet clear, cleansing and tasteless nectar that will intoxicate one who will not get intoxicated. Here it is until April 7, the conditions of this haj: Can’t drink: Milk, Goat Milk, Cow Milk, Kiefer, fried bong water, “OG Suga Watah”, Act-Rite JOOCE, coffee, tea, hot dog water, mineral water, soda, soft drinks, pop, smoothies, chocolate or strawberry shakes; soda-pop, protein drinks, POM Wonderful, lemonade, Snapple, Gatorade, Acai Berry Juice. Then there's whiskey (ouch), cognac (that smarts), Guinness (wow) and damn it this one hurts: no bacon-cheddar cheese-stick juice yummy, yummy (really gonna miss that one until April). Can drink: Water, Water and uhhhh, Water (From tap, bottled or with lemon and ice). It’s the return of the point man. After only a week, I see the real difference in my pocket book and I don’t feel much of a difference, addiction wise. And don’t miss anything -- except maybe for the BCCS juice, I know, right, delishhh – and I find that I’m winning on two fronts and may look to incorporate this into my life permanently, save a few special occasions. A friend and one very special person pointed it out it to me because I hadn’t thought about it until now. Yeah I'm on this water fast but I'm saving money too. Guess I was spending too much time tried and tested for not having Gatorade after my morning runs or coffee to put the edge on, or a John Daniels or Jack Walker (I know them by their given names) to take the edge off. Pondering this, I surmised that in an average day, in this fast-paced society, a person (namely myself or those of my ilk) may spend up to $20 per day on a combination of drinks. These are liquids that come with meals, morning coffee, herbal tea, Jamba Juice or my favorite over-priced store bought smoothie, Naked juice. This is to say nothing of the deceased potatoes, fermented wheat, tonics, spirits and dead grapes that some of us just must have in excess come Friday night through Sunday – especially when told about AIG’s latest quarterly loss. But right now, when baptized with this watah, yes sirrr, I’m on pace to spend next to zero instead of nearly $1,040 for the year on beverages alone and if I realize that if I can even save half of that, it makes a difference. Suffice it to say, I will not drink only water as my next investment plan, choosing instead of diversifying into bonds to get a Sparkletts bottle. Nothing of the sort. Actually I will likely be in the fetal position come April. At midnight of the 7th, I might just shun all food to imbibe everything on the “can’t drink list.” But I’ve seen the liiiiiight brothers and sisters, I’ve learned a lesson. I feel better, my circulatory system flows more pure, stomach is leaner, pockets are fatter. How’s that for Wisebread, which I can still eat by the way. So I can jail time it. That’s getting’ swoll off bread and water. No? Okay well, this is proof positive that a sacrifice in lifestyle instead of a mere sacrifice in conspicuous consumption wins out -- without you even thinking about it. And I can drink to that.

Permalink | 18 comments | Jabulani Leffall's blog | Channel: Personal Finance, Frugal Living, Art and Leisure, Budgeting, Consumer Affairs, Food and Drink

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