Showing posts with label money. Show all posts
Showing posts with label money. Show all posts

Sunday, April 5, 2009

When money's being made, everyone wants to call, visit and stay, as though some of the money might rub off on them, but making money necessarily takes up the bulk of one's day, which limits the amount of time and energy one can devote to socializing. When money's not being made, there is all the time in the world for callers and visitors, yet the calls and the visitors decline, as though poverty and failure might be contagious.
by igor 04:20 4 replies by igor 09:32 0 comments

Friday, March 20, 2009

Investment Advice and a Retrospective

If I had remained entirely true to my principles, I would be a wealthier man today. Instead, I listened to all these financial advisers that told every worker in America to put their 401-K savings in aggressive growth funds full of risky stocks.

To be fair to myself, I held out for years, keeping my money in bonds, until just before the stock market crash. Now my 401-K is worth half what it once was, and I suspect that any recovery will be a long time in the making. I almost added a scary aside, if a recovery ever happens, but thought better of it. It seemed like bad luck to me. The financial news does not look good, though. American manufacturing is in the toilet, and China is coming on full steam, while our political leaders are just waking up to the fact that Iraq is not the 51st state of the Union. The Democrats, at least, understand that it makes more sense to invest money in those states that are part of the United States rather than the Middle East.

In the early aughts, there was an excellent investment overlooked by most during the stock market's heyday, the Inflation-protected Treasury bond, or I-bond. I loaded up on these babies because they give you a little interest over and above the inflation rate. Not a super return, but safer than any other investment, and guaranteed to beat inflation. We can quibble over whether the government's declared rate of inflation is the real rate or not. Personally, I find the declared rate rather conservative, not reflecting adequately the cost of groceries, gas, and other items. Things like the cost of computer hardware is what the government takes into account, and if a processor is twice as fast as last year's model, but costs the same price, the bean-counters reckon the actual price has dropped in half. And they're wrong, and that's complete nonsense.

I-bonds that I purchased in 2002 are earning 6.48% interest today. Compared to the stock market's performance, that does not seem too shabby. I just wish I had thought to place more of my short-term investments into I-bonds.

So, my astute reader asks, are I-bonds a good investment today?

Nope, sorry to say, but to make money investing, you have to be a bit of a contrarian and go against what's popular. When everybody gets into an asset, prices grow dear and the potential return collapses. Some recent I-bond issues have had an interest rate that merely matched, but did not exceed, the rate of inflation. That's not very attractive. I bought mine when the I-bonds were beating inflation by two percent or more.

Today, I would go against common sense and keep my long-term investments in stocks. The reason is that stock prices are beaten down, many scams exposed, and investor vigilance has risen. Also, I believe inflation is likely to present a threat to the value of bonds. I have felt for some time that the U.S. is due for a major surge in inflation. Finally, if you sell now, you are locking in a sizable loss. Unless you can use the tax write-off, why take a loss?

What the fat cats were getting away with under the Bush Administration is not quite as likely to occur under Obama. He's not going to stop every abuse, but he represents the potential for additional government oversight and regulation, which has been needed for ages. I'm willing to bet that Obama is right about the economy and that he will succeed. My intuition tells me that financials and technology might represent attractive investments today. This advice is based upon no research at all and no experience. Just plain horse sense or donkey sense if you prefer, as I am a Democrat. Heyaw!

Monday, March 9, 2009

Warning Signs from Your Service Provider

When your service provider acts in a nervous fashion, sending you dozens of mailings pleading with you to buy more or tell your friends to buy more, then you know something is amiss with their finances. The last refuge of a CEO is to make a ton of mass-mailings, cross his fingers and pray that the suckers bite.

I subscribed at one time to Vonage, an excellent VOIP (Voice Over Internet Provider), through which unlimited long distance calls are made in exchange for a low monthly fee. Back in 2007, they began flooding me with offers through the mail. Ugly shiny decals to put on my car, and ugly cards to hand out to all of my friends. If I recruited a new customer, I would receive something like two months free. Well, I tried, I really did, but most people just don't make that many long distance calls to begin with, and those who do feel like they can just use their cell phone.

Upon receiving my fifth mailing containing marketing spam from Vonage, I became suspicious. It's that horse sense of mine. Something was just not right. I did a search on Google news and there was my answer. Vonage was in big trouble! In fact, many financial analysts predicted that it would fold in the first half of 2008! That did not turn out to be the case, as far as I know. At any rate, I called up Vonage to cancel my service, because it turns out I didn't make many long distance calls myself. The Customer Service Representative was such a nice lady with a pleasant sounding voice that I changed my mind. She had quite a way with words. I remember her saying, "If you keep the service, we will cut your bill in half!" Swayed by her feminine charms, I stayed with Vonage another six months.

The moral of this story is, negotiation sometimes works even with corporations, particularly when they are bleeding customers. They will do anything to stop the bleeding, including chopping your bill with a cleaver. Vonage may still be a good service today. I did not follow what happened to them after I quit subscribing. I think they are still around, because I got an email from them a month ago. Maybe they found a sugar daddy to help them through the difficult times. Most of their troubles stemmed from a lawsuit inflicted upon them by a larger corporation that seemed intent upon destroying them altogether. Vonage was actually a cute and feisty little dog of a company, and I wish them all the best.

Years ago, I used Charter Communications, a cable provider, as my Internet Service Provider. I wasn't terribly happy with them. The #1 problem was reliability. The Internet would go down and stay down for anywhere from ten minutes to TEN DAYS. No explanation would be given, and no refund credited to my account. Is that fair? Of course not. Sometimes, I called their technical department on the phone, but no one knew anything. Other times, I got in my car and drove to the local office for Charter and asked, "Why is my Internet down?" Their local office tells more about Charter than anything else. The employees are all behind bullet-proof windows. They pointed to a red telephone located in the lobby and told me the telephone would answer all of my questions. I picked it up, and a voice on the other end said, "Sorry Sir, we are working on the problem right now." This is about the time I decided to cancel Charter.

Charter then began sending me offers, at the rate of one per week, to come back to their ever-loving arms and embrace mediocrity once again. They were willing, not to reduce my bill, but to increase the services and give me a sweet package deal. They offered internet, VOIP, and basic cable television for $69. Sounds pretty good, doesn't it? If I hadn't experienced numerous occasions without any Internet, I would think so, too.

Charter liked to brag about how fast cable was compared to DSL. This misses the point entirely. As with electricity, the main issue with any ISP is reliability. The Internet must be up 99.99% of the time. As for speed, DSL technology has progressed until the speed gap is not what it once was. As for the package deals offered by a cable provider, who cares about television? Passive entertainment is the way of the past. Interactive entertainment--the Internet--is the way of the future. I would rather save $1 than pay anything additional for television. At any rate, the cable provider makes money off the content providers. Why do they need to also hit the customer up for fees? They're lucky anyone subscribes to them anymore. Most of the channels on cable TV are loaded with irritating commercials, and the content itself is abysmal just as it always has been. Cable providers brag about having a hundred channels, but how many of those channels are worth anything?

What ever happened to Charter? Bankruptcy! Am I surprised? Not in the slightest. Their Internet service was lousy, and for me, that is enough reason.

When you start receiving desperate offers in the mail, that's a strong signal that something is amiss. Do a search on Google and find out whether the company is suffering financial difficulties. You should not sign up for services with a company that is about to get flushed down the toilet. It's actually quite irresponsible and selfish for such a company to entice unsuspecting people to sign up with them. They're trying to recruit suckers to take down with the sinking ship.

Sunday, March 8, 2009

I Know a Scam When I Apply for One

I answered a craigslist posting offering $25/hr for "testing links to make sure that they work, troubleshooting web pages, etc."

I was just curious. Here's what I received.

---------

From: SEO Developers INC.
To: Glorious Igor
Sent: Thursday, March 5, 2009 12:28:46 AM
Subject: Re: job offer

Hi, and thank you for your interest in the link tester position.

To qualify for this position we have a simple screening procedure that we use to find the right candidate.

1. Go to http://xxxxxxxxx.xxxxxxxxxxxx.com/

2. Pick out 5 free offers that interests you and sign up for them. You will need to go all the way to the 'Thank you' page for each offer. Please indicate which ones you've signed up for in your follow up email.

3. Answer the following questions for each offer that you've signed up for:

a. What is the url you are directed to when you have clicked *LINK* after the offer?
b. Were there any errors on the way to the ‘Thank You’ page? Please take screenshots of how you got to the errors if there are any.
c. How long does it take for you to go from one page to the next? (Approximate time in seconds and indicate your connection type)

4. Email me the stats of each offer in the following form:
Name of offer
a. www.example.com
b. No errors
c. pg 1-2 (1 sec) pg 2-3 (2 sec) on cable modem

Once the screening procedure is complete we will send you the W2 form to fill out. You will be testing about 20-40 offers like this an hour. The list of questions that we will ask you to answer will be much longer once we hire you. Also, different offers will require different sets of questions to be answered. Sometimes you will need to write a mini review for the offer itself. The wage will start at 25$/Hr.

Thank you for your interest, we look forward to working with you.
-------



Arnold Gray
Resource Manager
SEO Developers Inc.
115 N 34th St, New York, NY

-----------

My readers may be wondering to themselves, "But Igor, this could be legit! Why do you think it is a scam?"

Here's why. What exactly is "SEO Developers Inc.?" That is a rather generic name for a company, isn't it? Located in New York, New York, the city of strangers. Who knows whether they exist or not? Strangest of all, there is no web site listed for them, so I can't really verify their existence, now can I? A search for "SEO Developers" on Google will turn up tons of references, but no company. "Arnold Gray" sounds like a fictional name of a character in a story if I ever heard one. "Resource Manager," indeed.

Worst of all, they expect you to bust your tail doing work for them even before you get paid a skinny dime. Now imagine if they have hundreds of people applying for the position. Why hire anyone? Just let the applicant-slaves do all the work for free. Post new ads when you have more work. Easy!

More sinister is the little info about sending this carrot cake your W2 form, with your Social Security number and all the other personally identifiable info. Can you say Identity Theft, Grandma? I thought you could.

Beware of Craigslist. I see all kinds of scams and fraud on there all the time. If you post a message about a real blog like mine, your message is likely to get taken down within 24 hours. If you post a message about a scam intended to defraud people, your message will survive for eternity. Why? Maybe you should ask the folks at Craigslist that interesting question. Personally I think they are lazy and just don't look into things at all. Posts get banned because some yahoo doesn't like something about the post. My blog being mostly about politics, the right-wing nuts will flag it in a heartbeat.

I'll tell you why I intermingle politics with tech lore on this blog. I don't want to help the right-wingers. I realize they're not going to read me. The liberals will, and those are the ones that will get the other, non-political information stored in my noggin. Those right-wingers that have an open mind and are willing to read the other side, they are also welcome to whatever advice I may have to offer. But the close-minded racists, fascists or Rush Limbaugh fans can go ahead and hit their "Back" button right away. I won't shed a solitary tear. Maybe they can apply for this great job testing links for $25/hr.

Monday, March 2, 2009

The Get-Rich-on-Ebay Meme

There is a wealth of information on how to start your own business on Ebay, if you want to call it a "wealth." At one time, I bought into the idea that anybody could get rich on Ebay. Are you like most of us, and don't really have a product to sell? No problem! Log onto Ali Baba, the online marketplace that connects Westerners with Chinese manufacturing firms, and you can order supplies wholesale direct from the factory. Then you simply add a profit margin of, say, 100%, design a neat little auction, and post said auction upon Ebay! What could be easier?

Is all of this importing of cheap plastic junk from China really such a good thing for the U.S.A.? Most of the things you find on Ali Baba are computer mice, flashlights, LED lights, keychains, pens, funky toys and gadgets galore, just the sort of thing destined for our nation's landfills and not the type of thing to decompose within a hundred years either. But let's put ethics aside for the moment and focus upon a real world example that involved the author.

I never bought anything from Ali Baba, not necessarily because of scruples, but because I realized there was too much of that sort of junk on Ebay already. But I did get myself into the Ebay game, importing not from Asia but from Europe.

A couple years ago, I purchased about fifty kilos of salty licorice from a Belgium manufacturer with a wholesale division in New York. The manager that I spoke with on the phone peppered me with questions, because I was not one of his usual clients and did not have a business license. He wanted to know how I hoped to sell the licorice. It was not difficult for me to realize that anything that I told him, he would try himself, so I told him I would be selling the stuff at local flea markets and made no mention of Ebay.

I was just testing the waters, as a matter of fact, to see whether there was any profit potential in this Ebay thing. Prior to making the call, I had researched Ebay thoroughly and knew for a fact there was no good source of salt licorice. All the other sellers were offering tiny quantities of 60 - 120 grams at high prices, whereas I intended to sell by the kilo at a quite reasonable price, while still allowing myself a healthy profit.

The licorice arrived right on schedule without any problems and was delicious, although I had no intention of consuming fifty kilos myself, regardless of the current status of my middle section. I designed a cute little auction that looked just like the sort of thing one might find in a gourmet magazine, posted it on Ebay and waited. My feedback rating, it should be noted, was 100% positive, and I knew that my good reputation would encourage buyers.

At first, I was quite successful. I sold several batches with a sweet 25% profit margin. Things were going well, and my head was in the clouds with plans of expanding my business. Years from now, I would be featured in "Fortune" magazine as the guy who built a multi-million dollar licorice empire. I imagined jetting around the world, buying factories and opening up shops in all the major cities. Then my dreams crashed.

After a few weeks, I noticed that my auctions were failing. No one was even bidding on my licorice. What was the problem? My customers had all given me stellar feedback--they loved the licorice, just as I did. I researched licorice on Ebay and discovered that somebody was selling the same stuff at a lower price. How much lower? About 30%, or my entire profit margin and then some, that's how much lower. I sold the remainder of my stock at cost, with no profit. This is when I realized that unless you have a special connection with a manufacturer and can cut out the middlemen, buying in large quantities, then you aren't safe from competitors. I had to get out of the licorice business and get out of Ebay altogether, because I don't have any such business connections and don't have deep pockets either. All I'm good for is computer stuff, and I understand the business side well enough to know that knowledge alone won't take you far on Ebay. Most items up for sale are commodities that are very sensitive to price.

If you want to make money on Ebay, my suggestion is not to negotiate with the Chinese. Why? Because a rich man with ten million dollars is already doing that, and the Chinese are cutting him a sizable discount to secure his business. He can stomp on you with impunity on Ebay. Commodities are the province of the rich, who can purchase in scale. The poor should focus upon products that require knowledge and skill.
techlorebyigor is my personal journal for ideas & opinions