Investing ↓

The thing nobody wants to talk about even more than potential bank insolvency sounds like an outtake from the 1984 sci-fi classic, Dune. It’s called the Jupiter High-Grade CDO V.

Say that three times fast. It’s funny, I’ve seen virtually nothing about these Jupiter bonds and a google search on ‘Jupiter Bonds’ turns up just about nothing. You have to search ‘Jupiter High-Grade CDO V’ specifically and even then wikipedia doesn’t even have a mainstream breakdown. There is a reason this bond is hard to find. Nobody wants to find it. Not even MSNBC. Not yet. Nobody wants to know what its real value is because it would be very, very, very scary to find out. Soon enough, everyone will have to get familiar with it, because it’s going to emerge as a leading heavyweight contender vs. economic recovery. 

In short, the Jupiter High-Grade CDO V was one of the grand puba’s of packaged, leveraged, sold, then sold again, leveraged for a hundreth time bonds that doesn’t exist in real time or space, but is an ephemeral evil-lord of the underworld than can only be contemplated by applying laws of quantum mechanics and theoretical physics. This process is also referred to as ‘creative accounting’. At its worst. For more information you will have to sift through the net as if you were searching for gold. Jupiter High-Grade CDO-V is something you won’t hear, see or speak about. Until it’s too late.

In the bubble months and years BLD (Before Lehman Brother’s Died) this was the bond that kept giving.  We’ve quickly discovered something different now:  The Jupiter Bond giveth.  And the Jupiter Bond taketh away.  It taketh away all the bank money.  It taketh away the notion that markets can self regulate.  It taketh away some fundamental tenants of capitalism.  Welcome to Jupiter.  The next stop on the recession bus.

What’s up with gold? It’s too heavy to carry out of the bank and horde in your closet and it was determined not to be gangsta enough to back our currency in 1971. There are commercials that have popped up suggesting that it’s a guaranteed good time if you invest in it. And there are women all over the United States having ‘gold parties’ where they bring the bling that they are ‘over’ and have an assessor give them cash for the recycling meltdown. Dang. To invest or not to invest that is the question.

Gold has traditionally been considered a safe haven or what the investment world likes to refer to as ‘hedge’ which would protect folks from market destabilization due to political unrest or other unforeseen occurrences (ahem, radical hard-core recession). But don’t be fooled by all the hype. While safer than many other investments, gold does fluctuate. Check the internet for a 2005 study conducted by Rick Munarriz where he compares the value of one share of Google stock to an ounce of gold. While gold won, the study provides a nice profile of the volatility and fluctuation of gold pricing in laymen’s terms that should not be ignored when determining if gold is an appropriate investment for you.

If you decide gold is for you, you don’t actually have to get a police escort and secured armored vehicle to bring it all home. Most gold investments are through bullion or coin ownership, or indirectly through certificates, accounts, spread betting, derivatives or shares. If you want to get started, you can talk with any of the usual suspect financial investment firms, or you can just buy from a gold pusher. Check the links below to start your research:

http://www.gold-investment.info/
http://www.blanchardonline.com/gold_as_investment/new_investors.php
http://www.gold.ie/

Be Bold. Be cheap. Slow down.

In 2008 BLD (Before Lehman Brother’s Died) the common knowledge was that stocks would out-perform any secure high interest savings scheme over the long haul (10 years or more), but now that the Dow Jones has hit 1997 lows plunging beneath the psychological threshold of 7000pts, it might be high time for reassessment of the value of a secure investment.

Secure investments are boring. They lack the sex appeal of risk and potential for gratuitous upward spikes. They are slow and plod along like an overfed-bull migrating toward ‘the end’ with no brain in its head whatsoever. But your money is safe. If you lack the wherewithal to participate the Las Vegas, casino-style gamble of wall street, you might want to consider a safe haven for your dinero. It’s a win-win situation. It’s a slow situation. But there is virtually no volatility. There is the lowest chance of risk (unless we roll like Argentina and there is a run on the banks), so if you buy into cliché’s like, ‘It’s better to be safe than sorry’ then this one is for you:

Savings Bonds and Treasury Paper
About.com – Treasury Securities & Programs

Certificates of Deposit aka CD’s
http://banking.about.com/od/cds/a/cdbasics.htm

Good Old Bank Savings Account
http://banking.about.com/od/savings/a/savingsaccount.htm
http://home.ingdirect.com

I didn’t mention fixed annuities or money market accounts because I’m not down with investing in insurance in the current climate and investment schemes on money markets seem a bit dodge at the moment, but maybe Recessiongirl will feel more frisky in the months to come.

Be bold. Be cheap. Try to get a big tax refund.

RecessionGirl is providing links to help you blow back with free or low cost tax preparation havens in your hood. The kind-hearted city of New York has also established a savings account cash incentive if you’d like to get some free money with your refund. If you’re eligible, knock yourself out with the links below:

Free and/or low cost tax prep:
http://www.nyc.gov/html/ofe/html/poverty/taxassistance.shtml

Free money via a city savings program:
http://www.nyc.gov/html/ofe/html/poverty/save.shtml

What tax credits are you eligible for:
http://www.nyc.gov/html/ofe/html/poverty/taxcredit.shtml

Make sure your tax preparer is legit:
http://www.nyc.gov/html/dca/downloads/pdf/consumerbillofrights.pdf

Get the most value for your refund:
http://www.nyc.gov/html/ofe/downloads/pdf/refund_tips_english.pdf

Be bold. Be cheap. Try to get a big tax refund.