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June 2005

Moving On Up

This article was written by in Economy. Comments Off


This just in: The Fed has raised rates another quarter point to 3.25 percent. The effect will ripple through the economy, which is good news for banks.

I’m looking forward to some of the banks, such as ING Direct and Emigrant Direct (where I hold my savings) raising their rates as well.

The Urge to Merge

This article was written by in Credit. 6 comments.

According to the New York Times, Bank of America is buying MBNA.

This is another reason why consumers should avoid carrying a balance on credit cards if they are being charged interest. As more credit issuers merge, there will be less competition. With less competition, annual fees and interest rates will rise.

Update: CNN answers some questions about the future in the wake of this merger.

GM’s Employee Discount

This article was written by in Consumer. 6 comments.

You’ve heard of this deal on the television and on blogs. General Motors [GM] is advertising an “Employee Discount for Everyone” sale, in which they are offering their vehicles for the same price an employee would pay, “not a cent more.”

Is it really a good deal? If you participate, most likely you will be paying 3 to 4 percent lower than the dealer’s invoice price. Some of the prices were previously unreachable through negotiation, and people have been taking advantage of this sale, to the company’s benefit. But according to David Ellis, there is still room for negotiation, especially on models that aren’t selling quickly.

The sale has worked well for GM. Their market share was up 30 percent earlier this month, mostly taken from Chrysler. While the promotion is scheduled to end after Independence Day, many people predict the offer will be extended.

Can this deal be related to the announcement that GM plans to lay off 25,000 workers between 2005 and 2008? After all, that’s 25,000 people who can no longer officially claim the employee discount. Nevertheless, it’s easy to call this offer “insensitive.”

Here’s how GM has performed in the market during the incentive:

The “real” employee discount is likely a much better deal for the buyer than the discount being advertised to consumers. Dealership employees often pay dealer cost or below, but I don’t know what GM factory workers or corporate employees pay. Their discount is probably significant.

If you’re planning on buying a car, The Motley Fool has a complete guide which should be read thoroughly.

Two updates: It’s official, this offer has been extended through August 1. Also, this post has been featured on the Carnival of Personal Finance #3.

Companies are paying bloggers to write about their products. Many of these bloggers don’t disclose that the company whose product they write about is providing compensation, whether it’s $5 per mention, a free vacation, or several thousand dollars.

Should there be mandatory disclaimer so an advertisement isn’t mistaken for a legitimate review? It may breach Federal Trade Commission guidelines without one. In fact, the Federal Election Commission is holding hearings this week to discuss the full disclosure of funds bloggers receive from political campaigns.

I’m fine with reviewing products on Consumerism Commentary. Throughout Consumerism Commentary’s run so far, I’ve been asked to write a few impartial reviews. I’ll gladly give an honest review for free (though I may be a little bit slow getting around to it), but it seems to be unethical and a conflict of interest to accept money for disguising product placement as a legitimate review. I have advertisements, yes, and anyone can buy an ad fairly cheaply, but they are clearly advertisements and not endorsements.

Today’s Articles of Interest

by Luke Landes

How Much Personal Liability Insurance Do You Need? The Motley Fool recommends covering yourself for how much you might have to lose if sued at the end of the term of insurance rather than how much you might lose if sued now. Are you an extreme saver? (For some reason, I’m reminded of the extreme ... Continue reading this article…

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Carnival Update

by Luke Landes

Yesterday was the Carnival of Personal Finance #2, hosted by Blueprint for Financial Prosperity. The Carnival is a good way for readers to learn about various blogs they might not already read and for bloggers to get more exposure for their articles. Any blogger is eligible to submit an article, as long as it’s (loosely) ... Continue reading this article…

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More Signs of a Housing Bubble?

by Luke Landes

Carnival of Personal Finance #2 has been published at Blueprint for Financial Prosperity! Bloggers can still submit articles throughout the day. Do it! Standard & Poor’s Rating Services is making it more difficult for individuals to obtain adjustable rate mortgages (ARMs). Their official stance is that this type of loan is the only factor that ... Continue reading this article…

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Master of Your Eminent Domain

by Luke Landes

Last week I talked about the Supreme Court decision regarding Eminent Domain. Hot on the heels of the decision, a town in Texas is preparing to seize 3 properties to make way for a marina. This time, businesses are involved rather than residences. The marina is expected to attract $60 million and create as much ... Continue reading this article…

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Entitlement Generation?

by Luke Landes

The latest term for those of us (though I will soon be abandoning this club) in our twenties is the Entitlement Generation. As the article notes, every generation has its period of negative labeling: “In their day, baby boomers were rabble-rousing hippies, while Gen Xers were apathetic slackers.” The crux of the Entitlement Generation is ... Continue reading this article…

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Frugal Anywhere

by Luke Landes

Another article on MSN offers 50 ways to trim your budget. The Bureau of Labor Statistics provides a chart outlining the average household expenditures as a percent of income, much like I did earlier this month. In each of the categories, the article offers some suggestions for cutting back costs. Many of these I’m already ... Continue reading this article…

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Frugal In The Country

by Luke Landes

How does a single mother of three kids survive on $31,000? First of all, she doesn’t live in New Jersey. After some unfortunate circumstances and some bad moves, Tricia offers some tips for making the most out of what you earn. The MSN article offers all of her tips, but to summarize, the list includes ... Continue reading this article…

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Friday Reading

by Luke Landes

Here’s what I’m reading today, updated throughout the day as I feel like it. Jim Jubak sees a revolt pertaining to property taxes and the Alternative Minimum Tax. Prediction: Oil will either spike to $100 a barrel or it will drop. There is a third possibility that the price will do neither. In conclusion, no ... Continue reading this article…

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Eminent Domain Rules Officially Changed

by Luke Landes

Let’s say you own a home, like many people in this country do. Let’s go further and say that you own the property completely. Maybe you had a mortgage, but it’s completely paid off. The property is yours. Well… as Jon Stewart is fond of saying, not so much. If your state government decides that ... Continue reading this article…

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News News: CNN Offers Liberated Video

by Luke Landes

CNN.com (which of course includes CNN Money) now offers its video features for free. Unfortunately, my company’s proxy server blocks access to the content, but nevertheless, this is a great move by CNN. Now all they need are better permanent links to the video streams and a trackback feature for every story.

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Wednesday Reading

by Luke Landes

Forbes takes a look at what the good life costs, with the “good life” being a nice house, good education for the kids, and a summer home. In the Northeast, my region of the country, it will cost at least $215,000 a year (after taxes and savings). That’s enough to make most families give up ... Continue reading this article…

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0% Balance Transfers

by Luke Landes

The 0 percent interest credit card balance transfer game is a popular one to play. I had first encountered the trend on the Motley Fool message boards a few years ago. The credit card companies are making these quick-money ideas a little more difficult to navigate, with rules that differ among the many different offers. According ... Continue reading this article…

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Time to Consolidate

by Luke Landes

I spent the last 45 minutes or so consolidating my student loans. I’m a graduate student, working on my Master of Business Administration degree from the University of Phoenix Online. Even though I have these loans, they get paid off as soon as I receive my reimbursement check from my company. However, when I first ... Continue reading this article…

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Handy Expiration Reference

by Luke Landes

For future reference: Real Simple magazine has published a guide to product expiration times. Also, here is the Table of Condiments That Periodically Go Bad, based on the periodic table of the elements. I have a version of this chart magnetized to my refrigerator.

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Carnival of Personal Finance #1

by Luke Landes

Welcome to Consumerism Commentary and the Carnival of Personal Finance! For an introduction to the Carnival, read this entry. For a schedule of upcoming Carnivals and their hosts, see this article. Below you will find the articles that have been submitted so far. The deadline was originally set for Sunday night at 10:00pm, but any ... Continue reading this article…

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PayPal Alternative – Not GreenZap

by Luke Landes

There may be a new PayPal alternative on the horizon, I’m not talking about the pyramid marketing scheme, GreenZap. Google is rumored to have a program in the works, tentatively called Google Wallet. The program could be a convenient feature for AdSense advertisers and content providers, and if Google begins offering a fee-based Gmail, the ... Continue reading this article…

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