The Next Rich Girl

How Your Income Stacks Up

Prepare to be shocked.  New statistics from the IRS show exactly how your income stacks up against that of your fellow Americans... those who pay taxes anyway.

The data show that an income of $32,879 or more puts you in the top half of taxpayers. Earning a bit more than twice that much -- $66,532 -- earns you a spot among the top 25 percent of all earners. You crack the elite top 10 percent if you earn more than $113,018.

Crazy, no?  Am I the only one surprised that it only takes just under $33,000 per year to be in the top half of American earners?  Is this the American dream?

Even scarier: More than 40 million Americans are now living in poverty. 

It sort of puts everything in perspective for me (Yes, I am in the top half of taxpayers...).  I guess things can always be worse, financially. 

Another Reason Not to Pay Taxes...

Okay, I'm not really advocating that you stop paying taxes, but it's stories like this one that really make you wonder why exactly you're forking over 25%, 28%, 32% or what not of your paycheck to the government.

Over $98 billion (that's billion, with a B) in taxpayer dollars were wasted in fiscal year 2009 - $26 billion more than in 2008.  To put that in perspective, that's enough to give every taxpayer a cash payment of $705.  

Wow.

This makes me think of that scene in the movie Dave (where an actor, played by Kevin Kline unwittingly becomes president of the U.S. and sort of rocks at it) needs to balance the budget and does so by just going through it with a red pen.



Sounds like we need someone to do that now.

Check out the full article for a breakdown of all the reported waste.  And this is just the waste that was reported!  Imagine how much actual waste there probably is...

Looking for the Silver Lining... Dow Hits New High, But What About the Jobs?

The new high in the Dow Jones Industrial Average has me wondering... "How do you get a job working for the Dow?"  After all, the stock market seems to be the only thing actually "recovering."  

Those of us who aren't day traders (do they even exist anymore? I imagine most day traders - at least those who day traded at home for survival - were destroyed in the financial crisis... but who knows?), aren't exactly feeling buoyed by the rising stock market.  Sure, it's nice to see our tiny little 401Ks rising again, but it doesn't exactly affect our day-to-day earnings in the way a paycheck does.

But, I refuse to be bummed out by the parts of the economy I can't control (namely the jobless situation and the dire state of consumer confidence).  Instead, let's look for that silver lining that must be around here somewhere...

1. The stock market is a leading indicator.

You may have heard this before, but it bears repeating (and explaining).  A leading indicator is an indicator that changes before the rest of the economy changes.  Think of it as a harbinger of things to come.  

The stock market is the most famous of leading indicators - it tends to decline before the rest of the economy declines and rise before the rest of the economy rises.  This is most likely because the stock market itself is forward looking.  People buy stocks because they think that the particular company they're investing in is about to increase in profitability.  If people don't think many companies will profit in the future, the overall stock market will go down.  In that sense, the stock market is really a way to look at the way investors feel about the overall economy.  

So, if the stock market is really a leading indicator, things are looking like they're about to get better soon!

2. Correlations between stock market bottoms and unemployment

But, if you want to really blow your mind (and impress your friends at your next cocktail party), look at this chart.

In short, this chart shows that stock prices tend to bottom out about a year before the stock market bottoms.  If this bears out, the employment market will start to look better around March of next year.  Sure, it's not exactly tomorrow, but at least it means the end is in sight.  We'll see if this bears out again, but, if it does, we can expect the economy to really start improving in just a few months. 

I think, if we've made it this far, we can make it a few months more.  How about you?

AIG Execs Return Ill-Gotten Bonuses... Some of Them Anyway

Last night, it was announced that 15 of the 20 top AIG bonus earners are returning the money, and Attorney General Andrew Cuomo is trying to convince the others to do so as well.

Cuomo stated, "Many of these employees have nothing to do with the meltdown in the financial products division. These are people who are trying to do the right thing. These are people who have been subjected to outrage."

So, why are we all still so pissed off? (Seriously, a writer over at Blogher likened the response to the French Revolution. Off with their heads!)

It's a symbol. AIG is just the most recent in a long flood of examples of Wall Street executives being rewarded for running their companies into the ground. Somewhere along the line, executives in the financial industry became convinced that "bonuses" aren't actually rewards for a job well done (for meeting goals, etc.), they were instead something that these executives were entitled to.. they became just another form of guaranteed compensation. "Bonus" isn't the right word for this and we shouldn't refer to them that way. They are just another paycheck, payment due for a job done... well or otherwise.

It's easy to blame these executives (and fun!), but the problem is bigger than that. This problem has been brewing for years as this form of payment became status quo in the financial industry to retain "talent." When I worked in finance, it was all about the bonuses. It was about rising to the level where you'd be guaranteed these bonuses and you'd be set. You worked your ass off to get to that point -- and it was still a tough, stressful job once you got there -- but the theory was that it was all worth it when you got to the level where you could expect this kind of bonus structure. It was expected.

But what happens when your compensation level is divorced from your performance level? What can we expect from employees who know that no matter what happens, they'll receive a huge bonus? The idea of a bonus is to provide a sort of "reward" for a job well done. If everyone gets one, what is the point of trying to go above and beyond the call of duty? Frankly, it's almost anti-capitalist (if you consider it part of the capitalist system that people who work hardest are rewarded for their work - it's sort of the "American Dream" version of capitalism, but one I think most Americans subscribe to).

In the case of the financial industry, this compensation structure made it more difficult for any executive (at any level) to blow the whistle on what was happening. There was no motivation to question the status quo. No incentive to "be the hero" so to speak and shine a light on the practices that put our economy at risk (not to mention the very companies these executives were working for), because as long as everything was trucking along as normal, everyone could pretend that everything was going to be okay.

Now, those same guys mostly don't have jobs. But they still got those bonuses.

House Passes Fair Pay Bill

From the "Really? This isn't already a law?" category:  House passes bill ensuring equal pay for men and women who do the same job.

About damn time.

It's pretty embarrassing that this isn't actually the law already.  How long will we allow companies to practice pay discrimination against women?  The bill should hit the Senate as early as next week.  Time to call your senators!    

Nice or Mean: Either Way, Women Finish Last

This article over at Alternet adds to the long list of evidence that no matter what women do in the workplace, we can't win.  We're too nice, so we don't promote ourselves, causing us to lose out on promotions.  But, when we are more aggressive, we're percieved as pushy bitches.  The double standard lives on, but what can we do about it?

I found this particularly interesting:

A 2004 study conducted by International Survey Research measured the attitudes and behaviors men and women displayed at the workplace and found a noteworthy discrepancy between the priorities of male and female employees. Female executives were primarily concerned with the well-being of the company, smooth employee relations and a well-run workplace. Men cared much more about getting ahead. 

So, even though women often actually make decisions based on what is best for the company (presumably for the benefit of the company's bottom line), it is still men who are rewarded for their "me first" attitude.  I'm starting to wonder what else can be done.  How do we break through this barrier? 

Transparency and Pay Equality

There's an interesting article over at Pink Magazine about the idea that making everyone's pay rate public will eliminate gender-based pay descrepancies. 

It's not a bad concept.  I know that I always seem to make the assumption (especially back when I was employed in the boy's club of finance) that men in the same position as me are making more than me, and I'm curious if that is actually true.  Will eliminating pay confidentialty make women more likely to stand up and demand the pay they deserve?  After all, it's easy to assume that you're being paid the same as your co-workers.  How angry would you be if you found out that the dingus in your department who always arrives twenty minutes late to meetings and always shirks away from new assignments is being paid more?  Eliminating the mystery surrounding pay may make the discrepencies harder to swallow.

On the other hand, I do think that you pay should be based on more than just your job title.  It's a function of your experience, education, performance, leadership abilities... everything.  Would eliminating confidentiality force corporate america to fall even further into a myriad of bureaucracy, documenting every discrepancy in a dozen different HR forms -- all filled out in triplicate?  I'm not sure.  I'm also not sure if that isn't worth it to guarantee pay equality.

The idealistic part fo me thinks that pay discrepancies will go away over time, as more and more women enter the workforce and, more importantly, continue to excel in the workforce.  The other part of me is sick of fighting so hard for something that should be such a no-brainer.  Equal pay for equal work.  Why is this concept still so difficult?

What do you think?  Would you want your salary disclosed for the sake of equality?

It's Official... We're in a Recession

The word is out, we're firmly mired in a recession.  In fact, we've been in one since December 2007!  Crazy.  It took the National Bureau of Economic Research a year to confirm what we've all been thinking.

In a weird way, this sort of makes me feel better somehow.  Not that I want to be in a recession, but I was starting to get frustrated and scared that if we weren't in a recession, how much worse could it get?  Now, that we know we're in it and we've actually managed to survive (more or less) the recession for a year, I feel cautiously optimistic that in a matter of months we'll find out that, surprise!, the recession is over already.

Here's hoping...

More Reasons to Avoid Black Friday...

In case the sheer terror of facing crazed holiday shoppers isn't enough to deter you from shopping on Black Friday, perhaps this story about a 34 year old WalMart employee being trampled to death will make you think twice next year.  I know that we're all trying to save money, but this is sick.

Maybe we should all avoid holiday shopping altogether, since new studies show that holiday shopping may make us all acutely stressed out. 

Perhaps this year we should make all our gifts...

What Would a Modern Day Depression Look Like?

It's not exactly the most festive of topics as we head into the holiday season, but the Boston Globe wonders what would actually happen if the economy fell into the full-fledged depression that some analysts are predicting?  Where would we feel it the most? 

By looking at what we know about how society and commerce would slow down, and how people respond, it's possible to envision what we might face. Unlike the 1930s, when food and clothing were far more expensive, today we spend much of our money on healthcare, child care, and education, and we'd see uncomfortable changes in those parts of our lives. The lines wouldn't be outside soup kitchens but at emergency rooms, and rather than itinerant farmers we could see waves of laid-off office workers leaving homes to foreclosure and heading for areas of the country where there's more work - or just a relative with a free room over the garage. Already hollowed-out manufacturing cities could be all but deserted, and suburban neighborhoods left checkerboarded, with abandoned houses next to overcrowded ones.

And above all, a depression circa 2009 might be a less visible and more isolating experience. With the diminishing price of televisions and the proliferation of channels, it's getting easier and easier to kill time alone, and free time is one thing a 21st-century depression would create in abundance. Instead of dusty farm families, the icon of a modern-day depression might be something as subtle as the flickering glow of millions of televisions glimpsed through living room windows, as the nation's unemployed sit at home filling their days with the cheapest form of distraction available.

I think we all have this idea in our minds of what the Great Depression was like, bank runs, widespread financial ruin for the country's elite, millions without jobs, commiserating on the streets... but now that the average American has so much more luxury in so many ways (we've filled our lives with stuff, instead of people), how long would we wallow in the only things we'd have left... the luxuries that got us into this mess.

One commenter at the Globe noted that the one thing setting us apart from the people living in the 1930s are credit cards.. so the theory goes that we'd stave off a depression longer by charging our lives away.  But, with tightening credit markets and the huge debt load that most Americans are already carrying... just how much longer can we last?

Forget the Financial Analysts... Bring on the Psychics!

Since no one seems to know what part of the economy will be hit next or when we're going to find our way out of this mess, perhaps consulting a psychic is as good a move as anything else these days.  As the New York Times investigates, this is a growing trend:

“Your mortgage agents, your realtors, your bankers, you can’t go to these people anymore,” said Tori Hartman, a psychic in Los Angeles. “They’re just reading a script — at least that’s how my clients feel. People are sensing that the traditional avenues have not worked, that all of a sudden this so-called security that they’ve built up isn’t there anymore. They come to a psychic for a different perspective.”

Psychics say their business is robust, as do astrologers and people who channel spirits, read palms and otherwise predict the future (albeit not the winning lottery numbers). Their clients, who include a growing number of men, are often professional advice-givers themselves, in fields like real estate and investments, and they typically hand over anywhere from $75 to $1,000 an hour for this form of insight.

I don't know about you, but $75-$1,000 seems a little steep for financial advice from a "psychic."  Perhaps these are the sort of investments that got us all in trouble in the first place? 

Wait.. I'm getting a vision... "You're all suckers."

Is anything recession-proof?

There's this idea that when times are tough, people cut back on the big things (fancy nights out on the town, premium cable packages, spa treatments, big purchases like new cars or electronics), but they often still justify the "little luxuries" in life (the $4 latte, booze, attendance at the occasional sporting event).  The theory being that Americans crave a little luxury and a cup of fancy coffee is a way for people to treat themselves without breaking the bank.

According to this article, however, this might not be the case for the current recession. (Yup, I said the R-word.  If this isn't a recession, I don't want to know what one is.)

That’s partly because this downturn — which has not yet technically been declared a recession — could end up being much worse than others in recent memory. But it also comes as more Americans are finding themselves with little if any savings, and less access to credit, leaving them with less money to spend on the escapist splurges that might otherwise have fared better in a downturn.

Makes sense.  Even for people who still have their jobs and homes, the pervading sense of economic gloom and doom is so dominant right now that everyone is freaking out and holding on tightly to their money.  There's this feeling that we have a lot more volatility to ride out before everything gets better... making that $4 latte seem less like a luxury and more like a completely idiotic purchase.

I feel it myself too.  When I worked in finance (in the heydey just a few years ago), I thought nothing of darting over to Starbucks.  Everyone knew my name and my order and I got a very necessary breath of fresh air to perk up my day.  Now it's a once or twice a month luxury at best, one accompanied by a much stronger feeling of guilt.

How about you?  Have you purged your life of these little luxuries?

Best PR Move Ever: Goldman Execs Give Up Bonuses

"Greed, for lack of a better word, is good."

Could it be that the infamous words of Wall Street's Gordon Gecko are no longer Wall Street credo?  Could it be that executives are starting to see that if they run a company into the ground, maybe they don't deserve a multi-million dollar bonus?  (Or, more accurately, has the recent recession finally made stock holders realize that they are the employers of these executives and they should be able to decide whether or not they deserve bonuses?)

Well, I'm not convinced that anyone has gained a conscience, but, at the very least, the move by Goldman executives seems to be an excellent PR move in one of the most volatile markets that wall street has seen in decades.  I hope other executives follow suit.  It's time that bonuses start going only to those who deserve them.

Coveting

Now that everyone's poor, thank goodness we still have some real and fictional socialites to look up to.

I guess girl really does want to be a princess... Or watch them screw around.

Unconventional Indicators

Few things are more entertaining than a bored economist... oh, wait, lots of things are more entertaining than a bored economist!

The New York Times takes a look at some of the more unconventional harbingers of economic gloom and doom.  We've moved beyond the hemline index, to some even quirkier ideas.

How are we doing on these indicators of an economic downturn?

Slower songs dominating the Top 40? (this week's number 1 song? "Whatever You Like" by T.I.)
Older, heavier, less curvy Playboy playmates? (Uh, they seem just as hot to me)
Higher beer and candy sales? (Hershey's is reporting record sales, according to the article)

How do you follow up one of the worst weeks in Wall Street history?

Yes, the Dow lost 22%, investor confidence is in the crapper, and the world is blaming the U.S. for bringing the whole global economy down, it stinks out there.

So, what better time to sit down and think about ways we can all save money? 

I've managed to turn the fine art of grocery shopping into an art in recent weeks, perusing the circulars for deals and combing the papers for coupons.  What are you doing to save a few bucks?

What will Wall Street look like in Fall 2009?

Not too fabulous, according to Jim Cramer.

Monday Quick Hits

In case you've been asleep for the past few days: Bailout is law.  Yes, the House passed the newly "sweetened" (that means they added a bunch of earmarks and deals to the original plan) $700 Billion bailout on Friday.  Later that afternoon, Bush got his mighty pen out and signed it.

The Congressional Budget Office's take: "the bill as a whole would increase the budget deficit over the next decade."

Fun.

So, with this historic bailout in place, you'd think stocks would be up and there would be rejoicing and merriment on Wall Street, right?

Hmm... not so much.  Instead, Friday ended the worst week in the stock market in seven years and, today, the Dow fell below 10,000 for the first time in four years.  Credit remains tight and European banks are starting to look like they're going to have an even rougher ride than banks in the U.S.

Looks like $700 billion might not save the markets after all.  At least, not right away.

Have I depressed you enough?  Cheer up: Here Comes a Recession!

Looking on the Bright Side...

Not to go all Pollyanna on everyone, I just want to take a moment to put today's giant stock tumble into perspective.

Yes, it's the biggest point decline in the history of the Dow.  That's not a good day, no matter who you are.  But, when you look at it in terms of the biggest percentage falls in Dow history (helpfully listed for you on the right side of this article), it doesn't even make the top ten.  I know that doesn't help your stock portfolio right now, but hopefully it puts things into perspective.  Two of the top ten percentage falls in Dow history were in the 1980s (October 19, 1987 (also known as Black Monday) and October 26, 1987 - rough couple of weeks), and we're all still here, right? 

We'll make it through, and we don't have to mortgage our future (you know, by using $700 billion in tax dollars to bail out millionaires) to deal with the present.  Honestly, bailout or no, we're all still going to have to ride this roller coaster for a while.

Hold on to your hats.

House says 'No"

I can't believe it.  The bailout didn't pass. 

Talk about a bunch of people in Washington running around with their tail between their legs.

Thoughts?

Bush Addresses the Nation

Ugh.  I swear, every time Bush opens his mouth I cringe.  Tonight was no different as he decided to address the nation, telling us "America could slip into a widespread financial panic" if the crazy bailout plan doesn't passed.

Uh, no.  You know what's a faster way to create "widespread financial panic"?  Having the President of the United States go on television to tell Americans that we could slip into "widespread financial panic."  What's next?  Is he going to tell us to go withdraw all our money from our bank accounts and keep the cash under our mattresses for safekeeping? 

Sigh, I'd really rather not have to worry about bank runs and what not, but Bush and his cronies aren't making this any easier.

Cheers to all the Senators and Congresspeople who are questioning the bailout.  Sometimes the fastest solution isn't the best one.  I think our elected officials owe us the best solution, the one that will help the economy for the long haul -- not a plan that rewards the idiots who got us into this mess.

Big Brother Tries to Get Even Bigger

Finally!  Senators are finally asking the right questions.  Namely, if the last two bailouts (Fannie Mae/Freddie Mac and AIG) didn't work, why should we throw another $700 billion dollars into this financial mess?

All I have to say about this right now is that the last time someone tried to push through major legislation without stopping to think about it, we got the Patriot Act.  Didn't that work out well?

The economy isn't some whiny trust-fund brat, you can't just throw money at it and hope it all works out.  Senators and Congresspeople, please, just slow down and get all the facts straight before we turn the once vibrant U.S. economy into the USSR.  No matter what happens, the market is going to have to weather the storm.  Sure, it's not what you want to hear right now, but the sooner we all face the music, the faster we'll be on the road to recovery.  The free market is a powerful thing, it will sort itself out.  Let that invisible hand do its thing.

By the way, in the video, notice how Paulson is basically saying, "Well, the taxpayers are already being screwed, so we may as well screw them over some more before we're done."  Ugh.

Sadly, Sexism Does Pay...

.. if you're a sexist, that is.

A new study published in the September issue of the Journal of Applied Psychology found that men who believed that a woman's place was in the home earned significantly more than men who had more progressive views.  $11,930 more.  Per year.

That's probably not that surprising since men who hold these views are probably the very same ones who promote the guy they go out with after work to ogle women over more qualified men and women who don't play the game.  It's all part of the vicious cycle of the Old Boys network (you know, the one thatMs. Palin is so fond of talking about) -- the jerks in power promoting other jerks in order to preserve their place in the pecking order. 

It makes me sick.  Especially when I talk to younger women (the ones who have just graduated high school, who have great grades and are going to a great college and who think that all it takes to get ahead is hard work and dedication.).  It's not that I don't think that these girls will get ahead, I think they will.  But I also think that it's tough when you realize that once you get into the workplace you often have to work harder, faster and more efficiently than those guys - the chosen ones who got their job because their dad is chairman of the board and who keep getting promoted for playing this same old stupid game.  These things are changing, but it's not over.  The Old Boys Network is a tough one to crack - it's takes a lot of briliant women to not just crack the glass ceiling, but to completely shatter it.  Keep chipping away, Rich Girls.  We'll get there.

Unsurprisingly, this study also found that women who hold traditional values about a woman in the workplace earn less than women with egalitarian views.  Well, of course they do!  They don't think they should be working!

Don't Sell Yourself Short

In the latest round of emergency action taken by the SEC to help prevent financial armageddon, short selling was banned on Friday.

So... what does that mean?

Short selling ("shorting" if you want to sound like you're in the know) is when you sell a stock you don't own (a stock you borrow) in hopes of buying it back later at a lower price.  So, instead of hoping that the price goes up, you hope that the price goes down in order to make a profit.  It's sort of the bizzaro world of investing.

Short selling often picks up in a bad economy when the stock market is going down and the SEC thinks that recent spats of short selling have contributed to recent volatility in the stock market and are pushing prices down.

Personally, I think the mortgage crisis, rising energy prices and rising unemployment have more of an effect, but who asked me?

More Help on the Way? (and who exactly is being helped?)

Stocks soared late today on news that the government might step in (again) and basically "make all the sad stuff go away." Apparently, not enough taxpayer money has been spent bailing out companies that didn't understand that giving money away to people who couldn't pay it back and, even worse, engaging in predatory lending practices.

Cheers to the U.S. Treasury (I hope you can sense my sarcasm) for looking only at the short term and for rewarding the big corporations while punishing us Next Rich Girls who were too smart to fall for the shit that the mortgage companies were selling.

Stay the course Next Rich Girls and revel in the (probably temporary) bump in your stock portfolio's value.

Hemlines Revisited

If it's true that hemlines rise during good economic times (flapper dresses in the 1920s, spandex miniskirts in the 1980s, etc) and fall during tough economic times (longer fuller dresses in the 1930s and 1940s), then why are designers trotting out short skirts in their latest collections?  Don't they know that the financial sector is in crisis, homes are getting foreclosed and we're mired in a recession?

Or, could it be that there is no correlation? 

Sad to tell you Rich Girls, the fall collections probably have no effect on the economy.  Just wear whatever hem length that you feel comfortable with.  The economy will sort itself out -- even if you're wearing that maxi dress.

via Jezebel

Forty Bailouts Later...

Stocks continue to be riled up by Lehman Brothers declaring bankruptcy (although there's already a reprieve on the horizon), the Merrill Lynch sale to Bank of America and the big AIG bailout.

There's more shaking and movement to come as we all deal with the aftermath of all this government intervention and ride out the drama in the financial sector.  The best advice I can give is this: Lay low, rich girls.  We will get through this.  Do not panic and sell all your stock, all you'd be doing is guaranteeing that you lose money.  Let's all take a deep breath and wait and see.  It's scary, but it's the best thing you can do right now.

More news (and hopefully a light at the end of the tunnel) will come...

Fannie, Freddie and You

You may have heard about Big Brother (aka the U.S. government) taking over two mortgage companies (Fannie Mae and Freddie Mac) over the weekend.  It's important for us future rich girls to know what exactly this means for our own bottom lines.

But first, what exactly happened? 

Basically, long story short (you can find a great run-down of the long story here) is that the federal government has launched what could be the biggest bailout in the history of bailouts, by deciding that these two companies are just "too big to fail."  So, to prevent them from failing -- and potentially taking the rest of the market down with them and prolonging this epic recession even further -- the U.S. Treasure now has a $1 billion (that's billion, with a B) stake in each company (that's $2 billion dollars total, for those of you keeping track) and can inject us to $100 billion more into these companies later if they need to.

What this money does is put more money into the mortgage market, helping Fannie Mae and Freddie Mac survive while the ill-advised mortgages they backed crumble.

Just to put this move into perspective, this is the largest federal intervention in the financial markets since a little thing called the Great Depression.  Scary.

If it works, mortgage rates will come down, Fannie Mae and Freddie Mac will be able to fund more mortgages (since they've proven that they're so good at that), and housing demand could get a boost as more money becomes available for homes (right now, it's pretty tough to get a home loan, this could theoretically help fix that because more money would become available for new homeowners).  Sounds good right?  Well, it is if it works and the jury is still out.

The real issue here is that someone has to pay for these loans one way or another and it appears that that someone is taxpayers like you and me.  Instead of allowing the market to fix these problems (which, admittedly would be very ugly in the short term as more and more homes would be foreclosed, the market would be hit even harder, etc.), the government has decided that taxpayer money should be used to prop up these mortgage companies that made bad loans to people who couldn't pay them back.  As a renter who doesn't have a mortgage, I'm not a fan of having to pay for my neighbors' houses.

As for the bigger implications for the stock market, I can't help but think that this "backstop" is only a badly applied bandage that eventually will have to be ripped off.  I can't imagine what ripping off that bandage will do to the stock market when it happens.

In the meantime, it's looking like a pretty good time to buy a house.

When She Earns More...

Apparently it's 1956 over at CNN, who posted this article on how to deal when the woman in the family makes more than the man. 

I'm so sick of this story line.  Memo to men: Get over it.  Women can provide for their families financially, even without a husband.  More girls than ever are going to college and graduating.  It doesn't make the 10 o'clock news anymore when a woman becomes CEO of a Fortune 500 company or becomes Supreme Court justice or manages a hedge fund or runs for president of the United States. 

Ladies, it's okay to earn more.  Hell, it's what we've been fighting for (and what our mothers have been fighting for, and our grandmothers...)  I hate this idea that there's equality to a point, but we need ot worry about our man feeling hurt if his wife earns more than he does.  This is what hurts women, when we decide that a woman's job only provides "supplemental income," we uphold this idea that when women work it's a hobby, but when a man works, it's a career.  Do any men feel bad when they make more than their wives?

When a man is financially responsible for a family's well being, it usually "buys" him out of household chores, according to Tichenor's [Veronica Tichenor, professor of sociology at the State University of New York Institute of Technology] research. He also tends to control the purse strings and be the decision maker. However, the same standards don't apply when women are the primary earners. In fact, breadwinning wives actively uphold traditional familial roles by still doing more housework and deferring financial control to their husbands, Tichenor says.

It's time to think of marriage as a partnership.  Cleaning the house and making dinner isn't "woman's work" - it's just cooking and cleaning.  Let's put these gender roles away and concentrate on this neat little concept called equality. 

Single Women and the Housing Crisis

Recent reports show that more single women than ever are buying their own homes (single women are projected to make up 28% of all homeowners by 2010).  This should be good news, but with the housing market in chaos, it may be single women who are hit the hardest:

But those gains haven't come without a price. Several studies have shown that women -- and women of color, in particular -- are more likely than men to be targets of subprime and predatory lenders, and that many of the women who have lost their homes to foreclosure could have qualified for lower-cost loans. And although there are no data comparing foreclosure rates between men and women, subprime loans have a higher rate of default. So with foreclosures soaring, experts say women are at particular risk of losing their homes.

The lesson to be gained here is clear, don't sign the paperwork until you understand exactly what you're getting into (what the terms of the loan are, when it needs to be paid back, what the payments are, how the payments can change, etc.).  If you're at all unclear about anything, don't sign.  Ask questions.  Get a second opinion.  Hell, get a third opinion.  Talk to people you trust.  It's not a sign of weakness to ask questions and to be careful about financial decisions.  Don't let yourself be bullied.

Frankly, I'm sit of hearing these kinds of stories.  About the "poor women" who get taken advantage of.  I feel bad for them, really I do, but this is about empowering women and we won't be empowered if we keep trusting other people to "do the right thing."  Real power comes from knowledge.  It comes from trusting yourself to get all the information you need to make the right decision.  And making good financial decisions is what will make you secure, powerful and wealthy.  Let's stop blaming everyone but ourselves for our decisions.

Powerful Women - Are you on the list?

No offense, but I'm guessing no.  But it's always interesting to see who makes Forbes List of the 100 Most Powerful Women in the World. 

Now, if only I were chancellor of Germany or CEO of a major corporation.  Here's to aspiring to be more than just a pretty girl with lots of cute purses....

Happy Labor Day!

When in Doubt, Just Give Up

... that's the message from Law Professor Laura Willis who told CNN Money that we should all just give up on financial literacy, it's a waste of time and just costs you money.

Sure, let's forget about learning to speak English, learning the traffic laws before you get in a car, learning anything about the Presidential candidates before you cast your vote... hell, let's forget going to college or doing anything else to improve your job prospects, too.  Those things are all too hard!

I hate this argument.  It's too hard so let's just give up.  It's true, financial markets are complicated, there are no guarantees that you'll make any money and the people whose job it is to sell financial products are often misleading in order to make a sale.  So what?  So are car salesmen and real estate agents.  That doesn't mean that you should never buy a car or a house.  It means that you have to do your homework.  Making money is never easy (unless you're an heiress, but than you probably aren't bothering to read this blog, are you?  You're the current rich girl, not the next one!).  Whether it's working a job you don't love to make ends meet or it's investing in your 401k, you always have to put forth some effort to make money.  Otherwise, we'd all be rich.

I'm not saying that everyone has the ability to become a financial guru, but I am saying that bowing out of the game is the one guaranteed way to ensure that you don't have the money you need to retire, to buy your first home, or to get whatever else you are saving for.

Skinny and Rich

Just came across this article on MSN about what would happen if no one were fat... predictably, the world would be a better place.  We'd be happier, more productive, it would cost less to cart our (lighter) asses around and Big Macs would become extinct.  What a wonderful world.

Yes, it sounds a little wild, but the implications of a leaner, meaner country add up to a weighty $487 billion. That's almost 3.5% of gross domestic product, no small sum.

In the meantime, the weight-loss industry continues to rake it in...

Home Economics

Now that the economy is officially in the crapper, it's time to revisit everyone's favorite nearly defunct subject: Home Economics! I think Home Ec has been phased out of most schools at this point, so I'm happy to impart the wisdom I got from the  one semester of home economics I took in seventh grade. How useful are these skills in saving money? You decide.

Let's see... I remember learning:

1. How to sew a basic apron -- fun for those of us who enjoy sewing, but not exactly a useful skill to help you save money. Unless, of course, you happen to desperately need a new apron.

2. How to make a lanyard out of those plastic shoestring things - again not incredibly helpful in a bad economy, although I do remember getting really good at these and selling them to my friends. Perhaps we can bring this trend back and I can open my own sweatshop? I think I charged about $2 each back in 1992, with inflation I could probably charge... what do you think? $20 each?

3. How to make and jar grape jelly - if you've got a whole day to kill and a hankering for about six jars of jelly, go for it. Otherwise, I'm sucking it up and buying the smuckers.

4. How to make "monkey bread" - now we're getting somewhere. This midwest comfort food made from pillsbury (or store brand) biscuit dough and cinnamon is high quality. I think the last time I had this was in seventh grade.

5. How to paint a t-shirt with puffy paint - God, please don't make me wear one of those shirts again. So much neon pink paint and so many sparkly unicorn appliques.... *shudder*

My home economic prospects aren't looking good here. What did you learn when you took home ec (if you took home ec)? Anything useful?

It seems to me that home economics as a course is more about training our young girls to be '50s housewives, rather than teaching young people - male and female - how to take care of themselves, how to live on their own without mommy/daddy/nanny/whomever taking care of them, how to save money, basically, how to survive.  Instead it seems like it's arts and crafts time at best and an opportunity to reinforce the idea of "women's work" at worst.

Via Jezebel

Hemlines and the Economy

Proof that you can turn anything into an economic indicator: Are falling headlines harbingers of an economic slowdown?  A writer at CNN seems to see a connection:

Layering. The economic downturn. Traction from an entrenched parents' backlash against highly sexualized looks for their daughters. Oh, and fashion's do-or-die need to throw something new at the gigantic but fickle teen/tween market as quickly as you can say "MySpace" or "Facebook."

I like the result: too-revealing camisoles and tank tops now paired with a covering hoodie or graphic T-shirt. Dresses topped by '50s-ish cardigans or shrugs. Vintage '70s-ish pieces picked up cheaply at thrift shops.

Also, layered items are interchangeable and can be put together in different ways, so I think (hope) we're saving money.

I'm not convinced that layering is saving anyone any money (doesn't layering just mean that you need to buy twice as many clothes in order to form a complete outfit?), but is it true that a trend to more modest clothing is connected to the economy?  Are you dressing more conservatively?

More depressing news on the jobs front... how many of you are looking for jobs?  Are you finding it difficult?

Next stop: Bear Country, USA.

Not exactly the happiest place to be.

Everything is on the rise (oil prices, personal income and spending -- thanks to those stimulus checks, which I still haven't received!), except stocks of course...

Buffett vs. Bernanke... they will fight in a battle where there can be no winners... who will win?

But seriously: The billionaire investor says inflation is 'exploding,' but the Fed believes commodity price shocks should subside.

Only time will tell, but inflation numbers aren't looking great and I never bet against Buffett.

Fed Holds Rates Steady...

I do know that our system has a genius for producing solutions that no one individually can see. And I know that our capital markets are still the world's best at allocating resources, and that our peculiarly American talents for risk taking, problem solving, and imagining are especially valuable in today's global economy.

Looking for the bright side in today's gloomy financial markets... just believe and it will all work out.

Finally, a good reason to be a renter... house prices post a record 15.3% drop.

Need some cash?

The presumed Republican nominee is proposing a $300 million government prize to whoever can develop an automobile battery that far surpasses existing technology. The bounty would equate to $1 for every man, woman and child in the country, "a small price to pay for helping to break the back of our oil dependency," Mr. McCain said in remarks prepared for delivery Monday at Fresno State University in California.

Mr. McCain said such a device should deliver power at 30% of current costs and have "the size, capacity, cost and power to leapfrog the commercially available plug-in hybrids or electric cars."

Sure, I'll just go whip that up.

Bad news for our city and state government worker friends... if you know any, buy her a drink. She'll need it.

Stocks Bounce on Deal News - all it takes is a few companies you've never heard (Republic Services and Allied Waste Industries, Bunge and Corn Products) of to merge and stocks bump up a bit.  Don't get too excited, it will be temporary, kids.

From the "kick 'em while they're down" department:  A downturn is a boom time for businesses that recover money or assets, usually from people who have fallen on hard times.

Stocks slip again... buy, buy, buy, ladies!

Floodwaters add to pressure on gas prices.

Time to start biking to work. 

What did I tell you?  Stocks fall in early trade.

Brace yourselves ladies, it's going to be a bumpy ride!

I think I'm going to be reposting the same headline every day for the next few months: Stocks struggle in early trade.

It's going to be a wild ride for the next few months, but, for all you wanna-be rich girls out there, I can't stress this enough: stocks are cheap now. If you've never considered buying stock or mutual funds or anything of the sort, now is the time to do it. When the market rights itself (and it always does, it's just a matter of how long it will take), you'll be thrilled that you did.