When AIG first went to the “well” for money from the federal goverment, the Associated Press reported that the Obama administration’s pay czar, Kenneth Fienberg, said bonus payments totaling $100 million to AIG employees from the same unit that prompted a massive taxpayer bailout are “outrageous” but they were allowed under the law. He said the retention bonuses were contractual obligations agreed upon years ago, before American International Group Inc. received a $180 billion federal rescue at the height of the financial crisis in late 2008. In an interview on ABC, Feinberg said, “These are the old grandfathered payments. I do not for a minute ignore the outrage out there, which I share. But the fact of the matter is we’ve got to abide by the law.” Feinberg said he’s working to get back as much of the bonus money as possible. He said AIG employees have agreed to repay $39 million out of $45 million in previous bonuses to the U.S. Treasury.

Well now it’s too late to ask. If AIG employees got a bonus and the company still can’t get on their feet it’s time to eliminate the problem, just like everyone else and every other business in the world.

How about all the small businesses out there that are also having tough times. For the last year these small businesses have been eliminating overhead and cutting costs across the board, most small business owners tht are struggling have stopped paying their own paychecks in order to keep as many of their most loyal employees still on the books. No government support is in sight for them. Worse yet, it takes months and sometimes years to eliminate some of the most weighing liabilities only to wait even longer before the cash flow catches up.

As far as I am concerned, AIG had their chance. Yes, we will suffer for the downfall of AIG but it will get better and in the end we will be better. But we will have make some difficult decisions first. AIG is not the only insurance company out there. AIG has enough subsidiaries, and they can do what we all do, focus on the ones that are profitable and cut the ones that aren’t and that means if you can’t sell it — close it.

Many businesses have collapsed under the stress of this fragile economy; some are still alive but running on the fumes of what they were able to scrape together soon after the recession hit them. Like I said, it’s been a tough year but it is not impossible to overcome. Now it’s time to rebuild our personal and professional lives.

As we enter the holiday season, I see the effects of this economic downturn hit yet again. Corporate CEOs and HR managers have had to do what was in the best interest of their companies – normally that means trimming the employee roster – at least for the time being. We’ve all had to determine where costs can be cut to generate needed cash flow so American companies can stay “open for business” and start to mend our damaged economy.

The same goes for families across the U.S. trying to find their “new” paths to personal financial freedom. Many of you were doing everything correctly and thought you had it made, only to discover that traditional methods of investing just didn’t work anymore and established family traditions had to be cut or done away with all together.

I’ve heard more and more people say that this year’s holiday season will be different – this year there won’t be as many presents given to as many people as there have in the past. Charitable organizations are already feeling the pinch because there are fewer donations coming in this year than in previous years. For many charities, the recession has delivered a double blow. There have been sharp drops in donations tied to increasing demand for their services in these difficult economic times.

Maybe it’s time for us all to start cutting back and simplify our lives. Perhaps we all should cut back a bit and use the extra time and money to get closer to our family and friends. Read more to your kids and grandchildren, and get interested in what your spouse is working on in the kitchen or out in the garage. Invite your friends over to play a board game – these are all things that will allow us to reconnect with people; something that is probably long overdue.

Like “Grandpa’s Great Depression,” we must now find new ways of doing things; changing our lives is not an option anymore. Prior to 2009, Americans were not savers – today more and more of us are starting to put money away for that proverbial “rainy day.” American business now understands that their consumer base has changed their spending habits and has had to get creative to keep things moving forward. This is all positive. These are all things that we should have been doing all along. Maybe if we had done so, the economic situation would not have hit us all so hard.

So this year, instead of indulging ourselves in a rich holiday season, maybe we should focus on what we have remaining in our lives. We need to center on giving thanks for the food and the time we can share with our family and friends, and celebrate the things that we believe in; commemorate the holiday traditions that make our lives meaningful. And one more thing, don’t forget to spend a little quiet time with yourself this holiday season, reflecting on the past year and looking toward the future with optimism.

Happy holidays,

James Dicks

But there are a few things that you can do to help the situation while the years ahead try to mend the financial damage that we’ve experienced recently. The first thing, and probably the most important, is not to ignore your current situation. Listen, I know that many of you have not been checking out your banking or investment statements lately because you just don’t want to see that bottom line figure. The fact remains, unless you know what that figure is, you won’t know where you’ll need to start the repair or how aggressive you’ll have to be to fix the problem. So, stop hiding and take a look. You might not like what you see but at least you’ll know where you stand and that will be the beginning of “fixing what has been broken.”

If you haven’t done so already, find an accountant. There have been so many changes to the tax laws in the past year and even the professionals are overly challenged when trying to keep up with the latest tax modifications. Many of you have started your own businesses this past year and if you try to mix that with your personal taxes, well, you could be in for an ordeal that might lead to errors in your final tax figures. So, let someone who knows how to handle the situation do it for you. Sure, it’s going to cost you a few dollars but in the end you’ll be more at ease and content that you did it the right way and, believe me, that will be well worth a few extra dollars.

In the computer age, you can automate many of your financial responsibilities that in the past you would normally worry about. Things like automatic bill pay through your bank’s website or payroll deductions to your 401(k) plan or savings accounts can do much to take some of the pressure off. You can also have your utility companies or a personal credit card simply debit your account on a monthly basis and you won’t ever have to worry about late fees. But even better than that, since you won’t have to actually sit down and pay the bills, you’ll have a lot of extra time to do the things you really want to do.

As we approach 2010, use some of your extra time to sit down and write your goals for the New Year. What did you want to accomplish this year that you didn’t? What would you like to achieve next year? Maybe it’s that vacation you’ve always wanted to take to Paris or finally finishing your education; whatever your goals are, just make sure you write them down and post them someplace. Ask yourself where you see yourself in five years. Then, prioritize those goals to figure out a way to make them happen. Once you’ve set your personal goals, make sure you stay focused and remain on course to complete them successfully. Constantly review and update your list of goals and modify them to reflect any life changes, experiences or priorities. If you want to make something happen you must set and manage your goals. Make that a priority this year.

If you are dedicated to creating a booming year ahead, you must make sure that you look at everything with a new point of view. If you’ve been doing things in a certain manner that hasn’t really been working out for you, the only way to change the outcome is by changing how you deal with the problem. Make something happen in the coming year by producing a positive environment that will allow you to realize the success you are striving to achieve.

Many retailers attribute 25 to 40% of their annual sales to “Black Friday” (the Friday after Thanksgiving), which is normally a fairly solid gauge as to what the rest of the holiday shopping season will look like. In addition to “Black Friday,” we now recognize the following Monday as “Cyber Monday,” as the beginning of the online shopping season. For many retailers that are already close to ruin, the 2009 holiday shopping season is very likely to tell the story. It could be the final blow for a number of the nation’s retailers and mall operators, already feeling the negative influence of a diminished year for retail sales.

As I shared with you recently, the national spending habits of American consumers have certainly been altered over the past 18 months and the traditional attitudes that the buying public had in the past are forever changed. This means that the nation’s retailers will also have to make some changes in order to cater to the newly formed buying habits of their customers. The plans at the retail centers for this holiday season appear to be centered on traditional values and bringing family together since that appears to be the major desire of the typical shopper this year. Smaller holiday gift giving and more time focused on the important things in life – time with family.

Stores are still hurting from last year’s’ holiday shopping season, which economists say was the weakest buying period since 1967, when the Commerce Department started collecting such data. The feeling is this year could be worse. Consumers with worries about being laid off or reduced hours at work plus lower credit lines are contributing to the dwindling consumer interest in spending this holiday season.

The retail centers will be displaying more things like gingerbread houses while using the traditional red, green and gold holiday colors to touch the current mood of today’s consumer. We’re all looking back when life was easier, safer, and perhaps even happier; those are the values that will certainly attract this year’s holiday buyers.

And according to a recent survey by Information Resources Inc (IRI), about 77 percent of American holiday shoppers said that while they didn’t spend much on the holidays last year they are more willing to open their wallets a little wider this year. The respondents added that they will continue to search for discounts whenever possible. According to IRI “functional gifts such as iPods, Blu-ray players for less than $99, Smartphone’s and clothes such as sweaters and jackets will likely top gift lists.”

There are indicators that suggest the U.S. economy may be coming to the end of its worst days, many consumers remain concerned by limited credit, high unemployment and home foreclosures. The new American consumer continues to save at historically high levels while paying their down debt. Just examining those concerns imply that we could experience yet another challenging holiday season for the nation’s retailers.

I usually find that if I’m not certain of where I’m going or how I’m getting there, I will tend to have more concerns than if I actively sit down and plan for the future.  We hear on the financial news programs every day that investors are “worried” about a variety of things that will move the markets lower.  What’s the point?!  Let’s start planning our personal situations and stop creating the anxiety.  The summer months are over and we are now preparing for autumn and the changing colors of the trees, feeling a nip in the air, and the smells of the season from cinnamon to evergreen.  I don’t know about you but I think this is a great time of year.  

Sure, there are some challenges ahead which could complicate our national and personal finances.  The negative scenarios that the U.S. economy is pushing through today along with the ever-increasing cost of energy could certainly cause a drain on our personal finances and put tension on the retail sector as well as pressuring the trade gap.  But there’s not a lot we can do personally to generate solutions for these hot topics.  The one thing we can do to sustain our personal “corner of the world” is to develop a positive and constructive attitude.  It really does help.  When you decide to carve out your personal path using even a small amount of confidence, you can’t help but develop the belief that you can succeed at anything you set out to do, no matter what the odds.  Believe me, I’ve done it. 

Positive thoughts and actions create positive results. If you have the wrong attitude then your trading could also be affected.  Doing anything with the wrong attitude will lead you in a direction that will be a burden rather than a blessing.  Individually, things can be tough to deal with but collectively – as an encouraging population – we can do anything.  As we approach the final quarter of the year, I’m hopeful for the months ahead and I hope you are too.  We’ve proven this factor in the past and I have no doubt that we will bear it out again in the future. Become proactive and cheerful by developing your attainable goals while staying focused on the situation(s) at hand.

The improvement of anything you do in life requires you to get the education you need, whether formal or informal.  If you feel like you need to improve your personal investing skills why not find a trading group in your local area and work with others to perfect your skills or take a formal class.  You’ve heard me say it before – it’s all about education.  If you are learning to play golf, I’m sure you have to practice.  If you are trying to master algebra, you have to study.  The same is true for an effective and profitable financial life.  Never give up! Determine your direction, get educated and you will get results! 

Happy trading!

For instance, while a certain amount of your portfolio will, no doubt, be invested in the equity market, you should also be involved in other areas of opportunity like commodities, options, bonds, real estate, and you should also consider the Forex (foreign exchange) market.  The Forex offers you another method of diversifying your investment strategy to protect your financial future.  I advise you to consider the potential benefits of the Forex and invite you to learn all you can about this unique method of investing.  One way to learn is to get a copy of my best selling book, Forex Made Easy…6 Ways to Trade the Dollar.  I wrote the book to be very investor-friendly and it will help you understand the Forex market and how to trade it.  It’s actually very simple and that’s why I like it so much.  The way I trade the currency markets only involves the U.S. dollar against six other major world currencies. That’s it!  Not 40,000 or more stocks or mutual funds…just six currencies!  I like that kind of simplicity.

Plus, if you are considering investing in the stock markets, you might want to consider issues that offer dividends with yields that exceed the 2.5% mark.  That’s probably much better than yield you can get at your local bank.  Check out companies that are showing brisk growth in such industries like the financial, energy or consumer sectors. Just do your homework and you’ll find something that will fit the mold and desired direction of your portfolio.

Determine what types of investments make you most comfortable and which investments make you uneasy.  If you have trouble sleeping at night because you’re worried about your investments then you shouldn’t be there.  Educate yourself daily through various media sources available to you; books, magazines, the Internet, television and radio.  Go to workshops and perhaps consider taking a class at the local college.  Always practice trading on paper before you invest any of your hard earned dollars in anything you are not familiar with. 

Listen, these are some extremely volatile days.  It seems like the financial markets have tried to maintain some kind of balance but recently this hasn’t been all that successful on a global basis.  Political rhetoric, deep concerns about the world’s economy, the growing federal budget deficit, and the daily fears of terrorism around the world has taken its toll on all of us over the past couple of years but now is the time to rebuild.  You should always keep in mind that no matter what the Dow is doing, no matter how the NASDAQ is trading, there are always investment opportunities that are increasing in value.  Just remember to always practice the one method of cutting the odds of losing your valuable investment dollars.  Assure that your portfolio is as diversified as possible. 

I am not a doctor but I would imagine that the simple reason some people get so over extended is that they run their credit cards up and then the interest literally chokes them.  What happens is that people get depressed.  When that happens, some people will go out to the mall or wherever and buy something, anything that doesn’t matter.  That immediately makes these individuals feel better, at least until they get buyer’s remorse.  Shopping for clothes, electronics, cars or whatever, is normally associated with a good feeling, so the next time you feel down you end up going shopping to buy something to make yourself feel better.  There are two problems with this; I doubt that many of you pull out cash to purchase these items, and you no doubt use a credit card.  If you don’t pay it off at the end of the month, you start to get hit with interest which is usually so high that it is hard to ever get ahead.

Second, the purchases get bigger; you will ultimately have to spend more and more to feel better.  This is a losing proposition all the way around.  What we need to do is eliminate credit all together.  We need to start paying for our purchases outright.  Yes, credit cards are okay, but you must use them wisely and pay them off at the end of each month.  So what else do you need credit for?  Maybe for a car or a home.  You can always a buy a used car and save money.  You can develop a strategy concerning your home loan by paying off extra principal every month. My point is, if you use credit, you have to have a plan to pay it off and get it paid off as soon as possible.

Credit only exists for one reason and that is to make you a slave to it and make the lender rich.  Everyone in America should start taking conscious control of their outstanding debt and begin to eliminate it.  Let’s make the lending institutions suffer a little, let’s make them squirm when they wake up one morning and realize that we have all decide to take back control of our finances.  Remember that if you are saving money you are making money.

Start calling all your creditors and ask them for an interest rate reduction, don’t take no for an answer.  You may have to talk to several people but you will find one that can help you lower your interest rate.  Not everyone at the bank will even know that they can lower your interest rate but they can and they will, if you are persistent enough.

If you are skeptical just know this, in one of our worst financial times I can remember the banks are doing everything they can to make more money at our expenses, so much in fact that the president has to get Congress to put restrictions on what they can and can’t charge for.  The banks are adding new expenses and fees to our accounts, they are raising interest rates faster then we can pay our bills.  Why? Because they are greedy and want to make sure we don’t get off their credit “drug,” so to speak. our society has become credit junkies.  It’s time to quit and start living debt free.  As a nation, we are spenders…not savers.  This paradigm has shifted over the last 40 years.  And we are bigger spenders than our brothers in the East. Asia, for instance, saves much more than we do and that has a global affect on our economies.  With financial times as tough as they are now, people are realizing that saving is something we all have to get back to. 

Let’s do it debt free.

I know it’s tough to do sometimes and it seems to be getting tougher as the days go by but you really need to start your day with some positive affirmations, a smile, some exercise, and a good breakfast.  And even if things aren’t working the way you had planned, if you look around your personal world, I’m sure you’ll see others who are having a worst time of it.  That’s an opportunity for you to step up and help them.  I’ve seen neighbors helping neighbors more often recently and that alone can give you a great feeling. 

I know sometimes it’s really difficult to stay positive and optimistic about what your future may hold – especially in times of financial hardship. And again, there’s the ever present media helping us to create a lot of worrying and frustration.

Remember that your personal attitude sets the tone for how your day will be.  It really does.  If you get up in the morning believing that you will have a hard time of it…you probably will.  You need to begin focusing on your obstacles and challenges (and I know you have them) and try to determine how you can beat them.  Stop dwelling on how they are beating you!

While it’s important to help others during hard times, be careful not to allow their “bad” situation to drag you down.  You need to bring them up to your level.  Listening to the problems of others can be emotionally draining.   I’m not asking you to be insensitive but I am saying that you need to guard your thoughts and by doing so, you protect your positive attitude. Safeguard your thoughts like they are a valuable treasure.

The most efficient way to help someone who is having financial problems is to try and be as objective as possible.  Try to guide the conversation away from the emotional aspects of the situation – and that, my friend is the challenge.  Offer them solutions that perhaps you have used to get out of a bad situation.  Pessimism can be contagious and damaging to your road to success.

Again, times are tough but it’s time to be bold and take a firm stand to protect your future. Learn to be solution-oriented and totally bright and cheerful. That is easier said than done so be prepared to focus on the required adjustments if you hope to make it through these hard times.  Also remember that you will not always succeed; there will be loss or failure at some point. Don’t dwell on the bad stuff. Successful people have taught us that success needs patience, determination, an encouraging attitude and the willingness to change, when necessary.

I heard on television the other day that tough times never last but tough people do.  I think that’s something that all of us need to take to heart in these difficult economic times.  Try to focus on the positive things that are happening in your life…your blessings, your children, a good meal on your table, a wonderful spouse, a job or the hope of a job.  If you think of things that are worthwhile, you will begin to live a life that is productive, useful and fun. 

Have a GREAT day today!

James Dicks

Whether or not you are behind on your mortgage, you can ask your lender for a mortgage modification. Remember, if you are not behind on your mortgage you can still ask for a modification.  Rest assured you will be told that there is nothing they can do for you until you are late.  Do not fall into that trap!  I personally know many people that have gotten mortgage modifications after they were told they could not.  The lender told them they would have to be at least 90 days late.  I know for a fact they have never been late and had their balances lowered, the interest and/or payments lowered, forgiven or waived.  But you simply can’t take “no” for a answer

If you are late – same thing; don’t take “no” for an answer!  Just keep asking until you get the answer you are looking for.

Here is the first thing you need to do – whether you are late or not.  Call your lender and specifically ask for the Loss Mitigation department.  Again, don’t take “no” for an answer.  You may have to call multiple times, but you will find someone to answer the phone who actually cares and that can get you going in the direction you need.  What you will find out is that you will receive as many answers to the same questions as the number phone calls you make.

Once you get Loss Mitigation, let them know your situation.  Let them know whether you were laid off, fired, had a pay cut…whatever. You have to let them know your financial situation has changed from when you first purchased your home, including the fact that your home is probably worth 30 percent or less than when you initially bought it.  In fact you might even consider giving the keys back to the lender and just buy the house next door for 50 percent less.

I can tell you that the banks – all of them – need to cut deals to sell their real-estate owned and/or non-performing assets.  In fact, many of the banks are encouraged or even rewarded by the government for getting rid of their non-performing assets.  That translates into working deals out with you.

If the bank reworks your loan and makes it current, then the bank will be able to move that loan off their non-performing assets list.  They are very motivated to do this.  The longer the property takes to foreclose, the longer it takes the bank to free up the money they have tied up on the non-performing asset, thus they want to cut deals and modify loans more than ever before.  So don’t be the one reading this saying I already did what you are saying and was told “no.” If you are saying this, you will lose.  The banks are changing their minds daily.

After you have started the process with your lender, you can go to “Hope Now” online.  They may tell you that you cannot file with them, again don’t take “no” for an answer; insist that they do.  Hey, even if you get denied – so what.  I know people that have been denied numerous times by their bank and by the “Hope Now” program only to actually get approved many “no’s” later. And that goes for people that have never been late before.

Okay, this is especially for you former Countywide people out there.  I have heard that Bank of America is so far behind that they are suspending actions of foreclosures on their Countrywide loans until they get caught up.  Furthermore, I specifically know someone who has a loan with Countywide that is currently going through the modification program.  They were about 90 days late as of February and called Bank of America to request a mortgage modification; they also filed with “Hope Now.”  Here is what has happened so far.   Nothing!  I mean nothing!  Well, except they haven’t made a payment and their loan is current.  What the bank did was tack the past due payments of the loan to the backend and then made the loan current.  They then said that until they get caught up to review the modification request no payments would be due and that the loan would stay current. So each month they get a statement from the bank giving them the loan balance and showing that they are current with nothing owed.  It has been months since the modification request. If you have an old Countrywide loan, start making your calls now requesting a mortgage modification.

I hope this helps you and don’t forget you must have faith above all things.  Don’t give up or as my uncle says, “don’t take yourself out of the game, it always gets better and as long as you move the ball along, things will change.”

All my best –

James Dicks