The Wall Street Journal has been running a series modestly entitled "The New Rules of Personal Finance". The most recent installment is on what to do differently now that you know that taxes will be going up.
As readers of this blog know, I’m not all that convinced taxes are on the way up anytime soon. Yes, the deficit and debt are heart-poundingly frighteningly large. And yes, any reasonable observer can see that something has to be done. That doesn’t mean it will be.
I am sure that the Administration and its supporters would, if they had their druthers, raise taxes significantly to get the deficit under control. But I am also sure they are aware enough to see that they just don’t have the political capital right now. And when would they? Next year, during the mid-term election season? In 2011 and 2012, when Obama will be facing what is looking like a tough reelection?
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It’s not exactly grabbing headlines, but our nation’s regulatory watchdogs are on the scent of yet another scourge from which investors need to be protected: leveraged ETFs. Apparently, these things are like snakes in the grass, just waiting to spring at poor innocents who wander by.
Several brokerages have taken steps to discourage their clients from buying
leveraged ETFs and in some cases prohibit it altogether. The folks at Motley Fool have been waving people off them. The association of state securities regulators named leveraged ETFs as one of their Top 10 Investor Traps, along with Ponzi schemes and currency and gold bullion scams.
And just last week, FINRA, the financial industry’s self-regulation body, announced changes to the margin requirements for buying leveraged ETFs that go a long way towards destroying their usefulness. A FINRA spokesman called leveraged ETFs ”very complicated, with a high element of risk."
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As numbers go, the results of surveys are not my favorites. Especially with regard to economic issues, I’m a lot more interested in what folks actually do with their money than what they say to a stranger who calls them on the phone and asks them what they think.
Still, numbers are still numbers and there’s a lot to be said for quantifiable data of any kind relative to the opinions and speculations of those of us with the time to type. And one of my favorite places for numbers is Gallup.com. The site is just filled to the brim with juicy tidbits, and more arrive every day.
For example, Joe Biden is unpopular. I think of him as an amiable place-holder, certainly more likable than the last few veeps. (Darth Vader, The Inventor of the Internet, and Mr. Potatoe Head, respectively.) Alas, America does not agree with me, giving Joe lower favorability ratings than his predecessors. The same survey shows that Obama is about as popular as George W. was at this point in his term, which is surprising, given Obama’s margin of victory last fall and Bush’s non-margin of victory in 2000.
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The week before last The New York Times carried a piece on when a person should start collecting Social Security. You kids who read blogs probably didn’t even know there was a choice about when to start getting those checks or that it significantly affects how much you get.
Basically, the longer you wait, the higher the monthly payment. According to the Social Security Administration’s example (quoted in the article without attribution) a person whose "full retirement age" is 66, and would get $1000 a month starting then, could instead have $750 starting at age 62 or $1320 at age 70.
This dilemma, less now or more later, is faced by all those who would receive Social Security payments, which is to say just about all Americans. (We assume.) And yet it does not get that much attention. Why? Because it’s complicated. There are a lot of moving parts, including some counter-intuitive rules and strategies involving spousal benefits.
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How screwed up are things in Mortgage Land just now? In a Florida dispute over a house in foreclosure, Wells Fargo is suing itself. Apparently, the bank holds both the first and second mortgages. Acting as the first mortgage holder, it is suing all the other lien holders, itself included. They’ve hired two 
different law firms and Wells Fargo (defendant) is disputing the claims of Wells Fargo (plaintiff). What’s really screwed up is that everybody involved seems to think that this is normal.
Nationwide, the tidal wave of foreclosures continues. We’re on pace to clock 3.5 million of them by the end of the year. That sounds pretty bad. But wait, I hear you saying, didn’t the government start a program a few months ago to fix this?
Well, yes it did, sorta. In March the Obama Administration made a big splash with the Home Affordable Modification program. As I wrote at the time, it was greeted with rather a lot of feigned enthusiasm. Under the surface there was much concern that it wouldn’t work, and more than a few doubts about whether or not it was a good idea in principle.
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Government, Investing, Media, Taxes | Frank Curmudgeon | 
September 15, 2009 11:00 am | 
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