Girl With a Purpose (GWAP)

Michael Jackson's Funeral: Unnecessarily Extravagant?

Michale Jackson
Originally uploaded by Michale Jackson

Now I know that we have a habit in the Caribbean and among black communities in general, that when we bury our loved ones, we bury them, "in style".

The poorest among us have the most extravagant funerals...

...So that the dead person's relatives can say that they put him/her away "good".

Oh, don't mind the huge debt the family incurs to put their loved one away "good"...they just want to know that he/she had the biggest funeral and could out-do the previous "biggest" funeral, reserved for the well known and most-loved members of the community.

Well, its seems that Michael Jackson's family is following this time-honored tradition.

They announced that Michael Jackson's funeral/memorial service will be held next Tuesday..

...And guess what?

1) There were supposedly 11,000 tickets being given away to those fans who wanted to attend...now it's been reported that this number has reached 17,500

2) The funeral will be held at the Staples Center - home to the LA Lakers and the last place Michael performed before his death.

3) The Staples Center have been selling these tickets through their website, which crashed due to the huge demand for them. [That's 17,500 potential/existing customers that can be marketed to and increased brand value for the Staples Center (from free publicity from the funeral), at a very low acquisition cost].

Now I've been wondering the following, since I heard the news:

1) Hasn't it been reported that Michael is indebted to the tune of US $500 million dollars?

2) Who will be paying for Michael Jackson's funeral/memorial service...his family or the City of Los Angeles(LA)?

3) How much money will this memorial service cost?

(It has also been reported that Michael's body will not be at this memorial service for him and that the city of LA is broke and will be stretched thin, should they be the ones paying for this funeral).

Yes, I know Michael Jackson was the king of Pop and yes, many friends, family and fans want to pay their last respects to him...

...But the Staples Center?

Again, I trust that the family/the City of LA has been wise and has struck up a beautiful deal with the Staples Center managers - a deal which is more of a quid pro quo than actual money being fleshed out.

The Staples Center has already benefitted and stands to benefit tremendously from hosting Michael Jackson's funeral:

They will forever be embellished in history...

Additionally, the money they stand to make by making the Center a monument to his death, will more than pay for any costs the family would incur for holding the funeral there.

I hope the family's business managers or the LA City Officials were wise in suggesting this...and did not actually flesh out any money for this venue.

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If it is that his family will pay for this memorial service and it is true that Michael is so heavily indebted:

I think it would be unwise for them to spend so much on the memorial service and:

1) Not attend to Michael's debt problems, first.

2) Not have sufficient money left over for the present and future well-being of his children.

I just hope that Michael's family or the LA City Officials are being wise, level-headed and financially prudent where his funeral/memorial service is concerned.

(I would like to thank Michale Jackson for his Flickr inset photo above).

Gillian

Copyright 2009 Gillian Campbell. All Rights Reserved.

 

Source Include

1) Article, "Massive demand for Michael Jackson memorial tickets" by Bob, Tourtellotte, Reuters, July 3,2009

2) BBC News, July 2,2009

Tiger Woods Feels Pinch of Global Financial Crisis

Tiger woods
Originally uploaded by scubaeddie32

Even Tiger Woods is feeling some effect of the global economic crisis.

One of his sponsors, General Motors (GM), announced on Monday that they were ending their sponsorship of the prolific  golfer.

The 9-year sponsorship deal was worth USD $10 million per year to Tiger and was slated to end, next year.

As part of the deal, Tiger took part in television commercials for the budget-priced range of cars - a source of mirth in some circles because Woods is reported to drive a Porsche. Ironically, during the nine years he has been promoting Buick its sale have reportedly fallen by 58% - more than any other GM brand. (Source: Article, "GM ends 9-year endorsement deal with Tiger Woods", by Tom Krisher, TheGuardian.co.uk)

General Motors, one of the "big 3" automakers in the US, has fallen on hard times.

According to Yahoo Finance:

"GM shares closed at 4.36 dollars on Friday, November 10,2008, down from more than 30 dollars a year ago.

The US automaker reported steep quarterly losses and warned it would run out of cash in the first half of next year and appealed to the US government for help to save it from collapse.

The company announced a third-quarter loss of 2.5 billion dollars and said it had burned through another 6.9 billion of cash during the three-month period."

This is compared to the $1.6 billion third-quarter loss it made  in 2007.

According to The Guardian newspaper:

Senior managers from GM travelled to Washington DC last week to ask Congress for a $25 billion (£16.5bn) loan in order to stave off the possibility of bankruptcy, although a spokesman for the company said the decision to sever its links with Woods at this time was "purely coincidental".

He said: "This decision is the result of discussions that started earlier in the year and the timing of this agreement with these other activities is purely coincidental." Last week, Buick announced it was also ending its arrangement to provide courtesy cars for players and officials at PGA Tour events in the US.

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Tiger Woods earned USD $120 million last year from sponsorship deals, according to Golf Digest magazine.

In all, he has made approximately $1 billion over his years as a pro-golfer.

Gillian

Sources Include:

1) Article, "Try not to cry as Woods becomes credit crunch victim", by Lawrence Donegan, TheGuardian.co.uk, November 25, 2008

2) Article, "GM ends 9-year endorsement deal with Tiger Woods", by Tom Krisher, TheGuardian.co.uk, November 24,2008

3) Article, "GM shares plunge after analyst sees them hitting zero", Yahoo Finance News, November 10,2008

4) GM's Quarter3 Earnings Release, GM.com's Investor Relations Page, November 7,2008

Are Investment Schemes Really Credible Investment Alternatives to Banks?

Friends, let's face it...you work hard and smart for your money...so your money should be working hard and smart, for you :).

The reality is that money in the bank is really just a safety net (for emergencies and other necessities),few banks will give you the returns on your money that will even cover inflation (the percentage increase in prices over a month or a year), much less take care of you, during your retirement.

So you have to find other investment instruments that will give you enough returns on your original investment to protect you against inflation, take care of some of your current needs and take care of you while you're aging.

(If you do enough research and/or speak with your certified financial advisor, you will find instruments and pension funds that will do so, while attracting very little or no taxes, on the increases/gains on your original investment.)

Traditional investment instruments include stocks, bonds, mutual funds, Certificates of Deposit(CDs). (CDs are only issued by banks and savings and loans institutions).

But increasingly, Investment "Schemes" are becoming common in Jamaica. Some claim to invest in the traditional instruments mentioned above, some claim to do foreign exchange (forex) trading.

Those that do forex trading claim to be very good at it...so good that they can give their investors returns of up to 18% per month, if "investors" leave their money with them over a certain time period (usually 3-5 years).

I put "investors" in quotes, as these Investment "Schemes" will tell you that they don't offer financial advice, but the money you invest, is really a loan: if you leave the money with them for a certain time period, you'll get phenomenal returns on your investments (e.g. the 18% monthly return,mentioned above).

(NB: that Investment "Schemes" are slightly different from investment clubs. Investment clubs give financial advice and club members are told how their monies are being invested.)

Of course the banks don't even give you 10% annually, so these "Schemes" have become quite attractive to many Jamaicans, wishing to supplement (increase) their incomes.

Since these Investment "Schemes" are not banks, they can't issue money,so they use Commercial Banks to encash cheques drawn on their accounts.(Their customers have to go to these Commercial Banks to get their monthly cheques.)

In Jamaica, over the past two (2) weeks, established banks like the National Commercial Bank (NCB) have been refusing to negotiate cheques drawn on unregistered Investment Schemes like "Cash Plus" (they are either delaying the encashment of Cash Plus customers' cheques, for up to 30 days, or refusing to encash these cheques, altogether)...citing various reasons: from these "Schemes" not disclosing their sources of income, to them not producing audited financial statements - requirements under the "Securities Act" and "Money Laundering Act" that govern Jamaican financial institutions.

There have even been suggestions that some of these 'Schemes" may be fraudulent.

[The Financial Services Commission(FSC), the body that regulates financial intuitions in Jamaica, held a forum, entitled, "The Role of the Investor in Investment Schemes", on Monday, November 26,2007, at the Terra Nova Hotel, in Kingston. They warned Jamaicans to pressure these "schemes" to open their books and produce audited quarterly financial statements.

They advised ordinary Jamaicans to learn how to read these audited statements (balance sheet, profit and loss account, cash flow statement) and to ask questions re how their monies are being invested.

What became clear during the discussions that ensued from this forum, however, is that the FSC is not sure how forex trading operates - they are just learning...they just want these "Schemes" to be transparent with the FSC and investors.]

What is interesting is that these very banks, who conduct foreign exchange (forex) trading, are telling Jamaicans to be wary of forex traders who are unregistered. (Some of the very people who used to trade forex for these banks, have now gone into business themselves, by starting their own Investment "Schemes".)

Why weren't these banks warning Jamaicans five(5) years ago when these "Schemes" came unto the market?

Well, what is being said by people in the "know", is that some of the banks' largest customers are withdrawing their monies and investing them in these "Schemes"...to get the higher returns that ordinary Jamaicans are now making.

The banks' profits are reportedly suffering as a result .

However, for the life of me, I can't see why, if these traders/"Schemes" are transparent, why they haven't applied for registration with the FSC. The cost is USD $71,131.15/JMD $5 million (US $71,131.15/ Jamaican $5 million)...small change for these guys and gals who claim to be making millions daily.

The banks have been warning Jamaicans that these "schemes" have a lifespan of five (5) years...this means they are just at the age when they will crumble.

Well what ordinary Jamaicans are saying, is that the banks have no say in this matter...they never cared about them before (Jamaicans are charged to deposit and withdraw money), so why all of a sudden do they seem to be concerned about their well-being now?

...These Jamaicans can now send their children to university, feed their families, live a decent life, when they couldn't do it before with the poor returns the banks give them.

Jamaicans who are investing in these "Schemes" are telling the banks to "back-off", to stop pressuring these Investment Schemes.

They are telling the banks that since they are so concerned about them, they should be giving them better returns.

They are also saying that they are astute (smart) enough, not to invest all their monies in these "Schemes", but to only invest money they can afford to lose.

Hmmh...

Well, Cash Plus has sued NCB for closing its accounts, and has been making alternative arrangements with overseas banks, to enable Cash Plus clients to get their monthly cheques. (E.g. issuing their clients with credit cards as of December 1, 2007 and wiring the monies from abroad, into their clients' accounts.)

As we speak, ordinary Jamaicans are pooling their monies, to get the required minimum investment amount, needed to enter these "Schemes".

So...are Investment Schemes really credible investment alternatives to banks?

Well, more and more Jamaicans are beginning to think so.

What do you think?

(Please note that the above advice does not substitute for advice from your certified financial advisor.)

Sources Include:

1)  Article, "Cash Plus squeezed - 'Suspicious' label delays bank payouts", by Shelly-Ann Thompson, staff  Reporter, Jamaica Gleaner, November 23, 2007

2) FSC Forum: "The Role of the Investor in Investment Schemes", November 27, 2007,

3) Article, "Bankers deny 'Cash Plus conspiracy"', Jamaica Gleaner, November 28,2007

4) Nationwide Radio, November 14-28, 2007

5) Power 106 Radio, November 14-28, 2007

6) Laws of Jamaica:The Securities Act, Ministry of Justice, Jamaica, website

7) Laws of Jamaica: The Securities Act (Subsidiary Legislation), Ministry of Justice, Jamaica, website

8) Laws of Jamaica: The Money Laundering Act, Ministry of Justice, Jamaica, website

9) Laws of Jamaica: The Money Laundering Act (Subsidiary Legislation), Ministry of Justice, website

Gillian

When Pennies Translate Into Big Dollars!

We have a tendency at times to store or to throw away small change (coins with very little value, like pennies, 10 cents, 25 cents and one dollar coins).

What some of us fail to understand is,that no matter how small the value of a coin is, it's still money. Money that if saved and invested wisely, can eventually rescue us when we really need it!

Just think about it...what if you took all the spare change you have around the house, bagged similar denominations together (that is, you put all the pennies in one small plastic bag, all 10 cents in another, etc.) and then took these bags to the bank or sold it to a shop (they're always in need of change) and used the paper money you got in return and put in a savings account (referred to as depositing the money)...

And then you kept depositing the money every two or three months...can you imagine the amount of money you'd have in that account after 20 years?

Let's do a little calculation to demonstrate (show you) my point:

Using the Compound Interest Calculator found at:

http://www.csgnetwork.com/compoundint2calc.html, and we'll explain each term.

a) Let's say your spare change added up to $100. So the original amount you deposited (your Original Principal) was $100.

b) You put it in a bank that gave you a 8% interest rate for the year (annually). That is Interest Rate = 8%

c) But, being the smart savers you all are,  you deposit an additional $200 in the bank account, each year. (Thus, Annual Addition = $200)

d) You did this for 20 years. (Thus, Years to Build = 20)

e) And the money is compounded annually. (That is, interest is calculated on the money annually). That is,  Annual Interest Compounding =1

In your 20th year you'd have accumulated $10,350.68!

Wow! from an original spare change of $100!

That's something to think about!

While this sounds great so far, there are some other issues that you must consider when you're saving or investing.

a) You must bear in mind the inflation rate. Inflation means increases in the price for goods you buy for your survival.

So if the inflation rate is 10% and the interest gained from the bank is 8%, the value of your money is actually decreasing. The reason for this is that the interest gained (8%) is less than the inflation rate(10%) and thus you cannot keep up with price increases of the goods you wish to buy to survive.

If you find that the interest rate given by the bank is lower than the inflation rate, you should shop around for legal investment opportunities that will give you a higher rate of interest (also called a return or gain) than the current inflation rate. - This is usually referred to as "beating inflation".

b) You must also consider taxes - some countries charge a tax on money stored in bank accounts or on money gained from investment activities. But they won't tax some government investment instruments like Treasury Bills or Municipal Bonds.

c) Your job is to find investment opportunities (a mixture of savings, certificates of deposit, stocks, bonds, government instruments, foreign currency, mutual funds,etc.) that are affordable (for you), beat inflation and are also tax-free (or have very small tax implications).

For beginners to investing, I highly recommend these two books, to help you to understand the world of investments and personal finance:-

1)"The Wall Street Journal Guide to Understanding Personal Finance", by Kenneth Morris and Virginia Morris.

This book is a great introduction to investing and personal finance and I use it as a quick reference guide from time to time. (It has a heavy US-slant, but the information is applicable and valuable, globally.)

You can purchase it  here from Amazon.com:

2) "The Wall Street Journal Lifetime Guide to Money:Everything You Need to Know About Managing Your Finances for Every Stage of Life", by The Wall Street Journal's Personal Finance Staff. (This book tells you what instruments you should invest in during your 20' - 30's, 40's - 50's and your 60's and beyond.)

I use this book along with the first book (to find more in-depth information) and it has become my investment bible. (It is much more detailed than the first book and also has a US-slant, but the principles can be applied, globally.)

This can be purchased, from Amazon.com, below:-

You can also do your own research on the Internet, using sites like The Wall Street Journal and The Motley Fool or subscribe to on-line magazines like Forbes, FORTUNE, SmartMoney, Equities Magazine to sharpen your investment and personal finance knowledge.

(All these these sites and magazines explain financial terms and give financial advice in simple, every day language).

Alternatively, or in most cases, additionally:

You may consult a certified, legal financial advisor (from a reputable firm). - Preferably one for whom you can track their (the company's, the funds they manage and your advisor's) performance, over a period of time.

Please be mindful that if you are using an advisor, he/she will charge for his/her advice and the management of your funds (usually called management fees). So when using an advisor, you have an additional task to ensure that the gains on your money, in addition to beating inflation, and being tax-free, also exceed these management fees.

No matter what route you chose to invest or save your money, it's always best to start as early as possible in life. So if you are a parent of a young child (or young children), you should be teaching them about saving their money as soon as they are able to understand what savings mean.

When they get a little older, you should introduce the concept of investment to them.

If you are an adult who hasn't been saving and investing your money, it's time to start now...no matter how small you may think the money is that you have - just look at our example of the penny saver, above!

I wish you all the best in your investment endeavours!

Please let me know how these resources have been helping you,ok?:)

(Please note that the advice given here does not substitute for advice from your qualified financial advisor/planner - please consult him/her for investment advice.)

Gillian