For parents with children in college, or nearing college age, this video from NBC’s Today Show is worth watching.
Investing in collegiate housing is not for everyone, but if the angle interests you, don’t forget to purchase an accompanying personal liability insurance for injuries that may occur on-site.
Economists worry about rising oil prices because it tends to generate higher pump prices for Americans. With more money spent on gasoline, there’s (theoretically) less money available to spend on goods and services.
Today, GasBuddy.com says that the average price for a gallon of unleaded gasoline is $2.792, up from $2.344 last year at this time.
Now, as a country, it is estimated that we consume 146,000,000,000 gallons of gasoline annually. That converts to 400 million gallons each day.
Therefore, the 44.8-cent difference between today and last year at this time, costs Americans an additional $179,000,000 in fuel charges daily.
And this doesn’t account for premium gasoline or diesel fuel charges.
Consumer spending makes up roughly two-thirds of our economy so when gas prices rise, economists worry — it means that less money is available to pump back into businesses, and that the economy should slow down.
The good news in this type of story is that people in the market for a new home loan may benefit. A slowing economy tends to lead to lower mortgage rates.
As Hurricane Season rolls on and the post-Fed meeting chatter dies down, expect to hear more from the news on the price of oil and gasoline.
The National Association of Realtors® released its monthly Existing Home Sales report for August 2006 and, as usual, you should be ignoring it.
The report discusses real estate on a national level and we all know that real estate is a local phenomenon.
It’s not that the report isn’t helpful — it is. The Existing Home Sales report paints a broad picture of our nation’s housing market which has implications for the economy as a whole.
The reason why the EHS report is not helpful to individual homeowners is because the process of buying and selling real estate is not a national occurrence — it’s a very, very local one.
When you buy your next home, you won’t be buying a home that exists in all 50 states. You’ll be buying a very specific home on a very specific street in a very specific neighborhood.
So, when the NAR — a national group! — reports that home supply is up and home sales are down, it is lumping every street in every town together into one giant chunk of irrelevant data.
Again: real estate is a local business, not a national one.
On the “street” level, the story can be much different from what the general reports tells us. Locally, there are plenty of areas in which there is a shortage of homes and in which property values are increasing.
This is why “national” real estate stories in the papers are often wasted ink — accurate real estate stories are the local ones.
In a study of 2,036 U.S. adults commissioned by Visa USA, nearly half of all Americans are losing track of their money.
An average of $45 in cash is “lost” each week in what Visa dubs “mystery spending”, Visa’s version of “I know I had this money in my wallet but I can’t figure out what I spent it on.”
Averaged out over the course of a year, mystery spending accounts for $2,340 — enough to fund a Roth IRA or other investment plan.
According to the study, events most likely to cause “mystery spending” include:
How people spend money isn’t the point of the survey but it does raise an interesting point about how careless we can all be with our dollars.
On one hand, we wonder how will we fund retirement, or pay for college, or send our children to tennis lessons. On the other hand, we aren’t even aware of how much cash we’re spending and where we are spending it.
For example, if the average American saves the $2,340 annually at 8% instead of “mystery spending” it, that money could grow to $31,000 in 10 years, $91,000 in 20 years, and $204,000 in 30 years.
Being aware of your money is the best way to control it.
Source
Half of All Americans Say They Lose Track of $2,000 In Cash Each Year
September 10, 2007
In a semi-surprise move last week, the Federal Reserve lowered the Fed Funds Rate by 0.500%.
The Fed wants to prevent a dramatic economic slowdown that started in the housing sector and appears to be spilling over into other sectors now, too.
According to some pundits, the half-point FFR drop was exactly what the markets needed — it restored confidence and promoted liquidity.
According to others, though, the Fed bailed out risk-takers and may have re-ignited the flames of inflation.
It’s hard to tell which side is correct, so we’ll have to believe that both sides have valid points worth considering.
And, like the market players themselves, the best course of action now is keep an eye on economic data and try to interpret what it foretells about the future.
This week, we’ll see a bevy of inflation-related data come down the pipe:
Each of these data points has an impact in its own right, but the PCE is a known favorite of the Fed. If PCE comes in higher than expected, mortgage rates will likely increase in response.
At least until the market regains a sense of balance, expect an over-reaction to most newly-released data. This could present some terrific (or terrible!) opportunities to lock in mortgage rates.
