Our online training courses are designed to provide novice currency traders with a broad overview of the Forex market. Covering everything from the factors that drive currency movements through to reading and analysing charts, and effectively utilising leverage, the course will prepare you with the skills you need to trade forex.
Our courses are available free of charge to clients - find out more from one of our forex experts, or apply for an account now to get started today.
Spot metals and oil
FOREX.com also offers trading in spot gold and silver and Brent Crude Oil, providing interesting alternatives to diversify your portfolio beyond currencies. Learn more about these dynamic markets in our online Spot Metals Guide and Oil Guide
Monday, August 24, 2009
New to the Forex market?
If you're new to the Forex market our online Forex Guide will take you through the basics: Learn how currencies trade, the importance of leverage and margin, and how to calculate profit and loss. We also explain the basics of technical and fundamental analysis and how to use these indicators to inform your trading decisions.
Test your skills risk free
Take advantage of a free 30-day practice account with £50,000 of virtual money. Test your trading skills with full access to our trading platforms including charting and analytical tools, and unique research and analysis available to clients of FOREX.com. Sign up for a practice account.
Attend interactive webinars
Join us for a free interactive webinar for hands on training, demonstrations and techniques to help you learn how to trade and analyse the Forex market. See our webinar schedule for upcoming events.
Test your skills risk free
Take advantage of a free 30-day practice account with £50,000 of virtual money. Test your trading skills with full access to our trading platforms including charting and analytical tools, and unique research and analysis available to clients of FOREX.com. Sign up for a practice account.
Attend interactive webinars
Join us for a free interactive webinar for hands on training, demonstrations and techniques to help you learn how to trade and analyse the Forex market. See our webinar schedule for upcoming events.
Forex.com UK LTD
FOREX.com UK Ltd is a trading name of GAIN Capital - FOREX.com UK Limited, a subsidiary of GAIN Capital Holdings, Inc. GAIN Capital is a global leader in foreign exchange trading, serving retail and professional clients in over 140 countries worldwide through its direct and partner brands, and supporting average trade volume of nearly $200 billion per month.
With FOREX.com UK, you have 24 hour access to the global foreign exchange market, plus powerful charting tools, expert market research and commentary, and advanced forex trading tools. We also offer a wealth of education and training, covering everything from getting started in forex to understanding technical analysis and developing a trading strategy. Register for a practice account today to see for yourself.
With FOREX.com UK, you have 24 hour access to the global foreign exchange market, plus powerful charting tools, expert market research and commentary, and advanced forex trading tools. We also offer a wealth of education and training, covering everything from getting started in forex to understanding technical analysis and developing a trading strategy. Register for a practice account today to see for yourself.
Thursday, August 20, 2009
General American Investors Files Certified Shareholder Report for Period Ended June 30, 2009
NEW YORK--(BUSINESS WIRE)--General American Investors Company, Inc., a closed-end investment company listed on the New York Stock Exchange (GAM), filed with the U.S. Securities and Exchange Commission (SEC) its Certified Shareholder Report (Form N-CSR) for the six month period ended June 30, 2009. The Form N-CSR contains the Company’s June 30, 2009 Semi-Annual Report and is available at the SEC’s website: www.sec.gov and the Company’s website: www.generalamericaninvestors.com. The Semi-Annual Report is expected to be mailed to stockholders shortly.
Financial Information
The Semi-Annual Report indicates that as of or for the six months ended:
| | | | 6/30/09 | | | 6/30/08 |
| | | | | | | |
| Net Assets Applicable to Common Stock | | | $732,059,359 | | | $1,141,320,885 |
| | | | | | | |
| Net Assets Per Common Share | | | $22.89* | | | $36.15 |
| | | | | | | |
| Net Investment Income | | | $3,648,823 | | | $5,704,953 |
| | | | | | | |
| Per Share | | | $.11 | | | $.18 |
| | | | | | | |
| Net Gain (Loss) on Investments | | | $58,521,196 | | | ($54,567,810) |
| | | | | | | |
| Per Share | | | $1.85 | | | ($1.72) |
| | | | | | | |
| Common Shares Outstanding | | | 31,980,872 | | | 31,573,058 |
| * | After dividends and distributions of $.215294 per share paid in February 2008 and $.44 per share paid in December 2008. |
Securities Transactions and Positions
The Company reported that it made new commitments during the second quarter of 2009 in Alpha Natural Resources, Devon Energy, International Game Technology, The Travelers, and Wyeth. In addition, it increased its holdings in Arch Capital, Fidelity National, Nelnet, PepsiCo, and Wal-Mart during the second quarter.
A position in Patterson-UTI Energy was eliminated, while reductions were made in the holdings of American Express, AXIS Capital, CEMEX, Lamar Advertising, M&T Bank, NetEase.com, and Target.
The largest stock holdings in the Company’s portfolio at June 30, 2009 included: The TJX Companies, Inc., Weatherford International Ltd., Apache Corporation, QUALCOMM Incorporated, and Wal-Mart Stores, Inc.
American investors won’t come to Ghana: It’s their money, not the President’s
President Obama came to Ghana to endorse the country’s good democratic process. In the midst of chaos, needless bloodshed, and tainted elections and accompanying violence in Africa, Ghana stands out on the continent as a good example.
But beyond democratic stability, the country also needs economic stability and growth.
In an editorial, ghanabusinessnews.com looked at the possible ripples of President Obama’s visit and wondered if American investors would come into the country to do business.
The Managing Editor of ghanabusinessnews.com posted the editorial on his blog titled Rightup at www.emmanuelwrites.blogspot.com.
In direct response to the question of whether American investors would come and invest in Ghana because President Obama has endorsed the country, a reader sent an email to the editor.
He began by writing, “Came across your blog After Obama’s Ghana visit, would American investors come? and wanted to share some thoughts with you. The short answer is no! And that is because it is not the President’s money that will be invested.
The author of the mail, Ramesh Kanthilal, Spokesperson and Director of Operations for AFREECON. AFREECON is the acronym title for Africa’s Economic Emancipation Conference, it is written on the organisation’s website.
Enumerating further reasons why American investors will not come, he said, African countries, Ghana included, are clueless about how to attract capital–the right kind of capital. Not the exploitative capital that has come from Europe for almost six centuries. If Europe is a good source of capital and ideas for African economies, why are African countries not doing better than they are? After all Europeans have been coming since the 1400s.
On Africa’s leadership he wrote: “African countries are lead by people who would rather “pocket” the people’s money, than invest it in efforts to market their economies and their countries.”
On the foreign missions of African countries abroad, he cited the Ghana Embassy in Washington and asked a question: “Have you ever tried to call the Ghanaian Embassy in Washington?”
“You should try it. It is an illuminating experience. The experience has been a very mixed bag for our team and would not inspire us to want to invest in Ghana”, he said.
“African embassies, as a whole”, he said, “do such a poor job of representing their countries in the arena of marketing the opportunities for investment in their countries, that it is a wonder there is any interest at all.”
He remarks that in an organized environment, chaos is not tolerated. “And the way and manner in which we correspond with the outside world at best, denotes a chaotic existence and at worst demonstrates incompetence of the highest order. There is the image of African countries.”
He argued further that no investor would invest his hard earned money in a place where all you read about is bad news.
He goes on to talk about Africa’s failure to educate Americans about the continent. He said, “in the case of Africa all the countries are in the same boat. Most Americans think Africa is one country because their embassies have failed to do anything about the image of the continent’s countries in the almost 40 years that I am personally aware of.”
Adding “history shows that the drumbeat of bad press and perception has been filtering into the minds of US consumers for more than 100 years–in fact, since the advent of mass media.”
He also blamed Africans for not being willing to put any effort to communicate that they would like U.S investors and what kind they would like? “They are waiting for someone to come and “spoon feed” them the answers,” he said.
He had some advise for the media also. “You and your colleagues in the media”, he said , “are responsible for getting out the word and pressuring leaders to make unselfish decisions.”
Commenting on export data used in doing the analysis in the editorial, he said, “you have to not just talk about the poor export performance and low-level of U.S investments, you have to ask why that is the case? Why is it not better, why have African countries–Ghana included–failed so badly where the Asians seem to be doing so well…why has South Korea come from behind African countries to not just overtake African countries, but to now be in the position where they are playing the role of “teachers” of African leaders?”
He is however hopeful that if the media and everyone else including his organization do their bit the trend could be reversed.
They are therefore organizing the AFREECON business conference at the famous Navy Pier in Chicago, Illinois from October 19 to 21, 2009.
According to the organizers, AFREECON is about sharing knowledge. Knowledge that will assist African countries to build a better “mouse trap” for attracting Foreign Direct Investments and achieving economic independence; as well as knowledge that will enable U.S. companies and entrepreneurs to make well informed decisions about business opportunities in African countries.
Among some of the speakers are Dr. Ian Giddy, Professor of Finance at New York University’s Stern School of Business and a former Director of the International Product Group at Drexel Burnham Lambert; Dr. Vijay Mahajan, who currently holds the John P. Harbin Centennial Chair in Business at McCombs School of Business, University of Texas at Austin; Dr. Dambisa Moyo, economist and author of Dead Aid: Why Aid is Not Working and How There is a Better Way For Africa.
The others are William “Bill” Strickland, President and CEO of Manchester Bidwell Corporation; Dr. Paul Tiyambe Zeleza, Malawian historian, literary critic, novelist, short-story writer and blogger at The Zeleza Post; Dr. John Gazvinian, author of Untapped-The Scramble for Africa’s Oil and Dr. Pompiliu “Pili” Vezariu, Adjunct Fellow at the Center For Strategic & International Studies.
By Emmanuel K. Dogbevi
Approaching an SBIC
Research the SBICs
If you own or operate a small business and would like to obtain SBIC financing, you should first identify and investigate existing SBICs that may be interested in financing you company. Use this directory as a first step in learning as much as possible about SBICs in your state, or in other areas important to your company's needs. In choosing an SBIC, consider the types of investments it makes, how much money is available for investment and how much might be available in the future. You should also consider whether the SBIC can offer you management services appropriate to your needs.
Plan in Advance
You should determine your company's needs and research SBICs well in advance-long before you will actually need the money. Your research will take time, as will the SBIC's research of your business.
Prepare a Prospectus/Business Plan
When you've identified the SBICs you think are best suited to provide financing for your company, you'll need to prepare a presentation. Our initial presentation will play a major role in your success in obtaining financing. It is up to you to demonstrate that an investment in your firm is worthwhile. The best way to show worth is by presenting a detailed and comprehensive business plan or prospectus that includes, at a minimum, the information contained on this page.
How to Seek SBIC Financing
Small business investment companies (SBICs) exist to supply equity capital, long-term loans and management assistance to qualifying small businesses. The privately owned and operated SBICs use their own capital and funds borrowed from the U.S. Small Business Administration (SBA) to provide financing to small businesses in the form of equity securities and long-term loans. SBICs are profit-seeking organizations that select small businesses to be financed within rules and regulations set by SBA. Specialized SBICs (SSBIC) are a particular type of SBIC that provide assistance solely to small businesses owned by socially or economically disadvantaged persons. SBICs invest in a broad range of industries. Some SBICs seek out small businesses with new products or services because of the strong growth potential of such firms. Some SBICs specialize in the field in which their management has special competency. Most SBICs, however, consider a wide variety of investment opportunities. Only firms defined by SBA as small are eligible for SBIC financing. The SBA defines a company as small when its net worth is $18.0 million or less, and its average net (after tax) income for the preceding two years does not exceed $6.0 million. For businesses in industries for which the above standards are too low, alternative size standards are available. In determining whether a business qualifies, all of the business's parents, subsidiaries and affiliates are considered.
Welcome to American Investors Company
American Investors Company (AIC) is one of the largest privately-owned securities firms headquartered in the San Francisco Bay Area. We are a full-service, general securities and investment advisory firm providing clients access to a full line of non-proprietary securities products, investment brokerage, financial planning and asset management services.
We have been dedicated to addressing the financial planning, investment and retirement needs of our clients since 1966. During the last 40 years, we have built a solid reputation for successfully assisting our clients in meeting their financial goals. Registered representatives associated with our firm are thoroughly trained professionals qualified to work closely with clients to help them achieve their financial objectives.
Come and take a closer look at us. You’ll be glad you did!
AIC is licensed as a broker-dealer in AL, AZ, AR, CA, CO, CT, DE, DC, FL, GA, HI, ID, IL, IN, KS, KY, ME, MD, MA, MI, MN, MS, MO, MT, NV, NJ, NM, NY, NC, OH, OK, OR, PA, RI, SD, TN, TX, UT, VT, VA, WA, WI, and WY and may only transact business in those states.We are also registered with the SEC as a Registered Investment Adviser in AZ, CA, FL, MD, NV, NY, OR, TX, and WA.
If you do not reside in one of those states, we will not attempt to transact securities for your account or provide you with investment advisory services unless and until we are properly licensed in your state.
Nothing contained herein should be construed as an offer or solicitation to purchase any security or to render specific investment advisory services. Such offer or solicitation to purchase can only be done when preceded by appropriate offering materials or subsequent to receipt of AIC’s Form ADV and execution of an investment advisory agreement.
Wednesday, July 29, 2009
Most Expensive Wines in the World
The word wine has its root from the ancient Greek word for vines, vinos. Grapevines produces lush grapes which are then fermented to create the popular yet sophisticated alcoholic drink we know as wine. In many areas, the English word wine and its synonyms in different languages are protected by law, as other beverages similar to wine can be produced from fruits, rice, flowers and honey.
At the highest end, rare, super-expensive wines are often the costliest item on the menu, and exceptional vintages from the best vineyards may sell for thousands of dollars per bottle. Expensive red wines with their complex subtleties are traditionally more costly than other expensive wines.
Here are the most expensive wines in the world.
| 1992 Screaming Eagle around $80,000 At Auction Napa Valley 2008, a charity event, a lot of six magnums of Screaming Eagle were sold for $500,000. In addition to the wine, the lot included a dinner at the winery. The lucky purchaser was Chase Bailey, an executive at Cisco Systems. 1945 Chateau Mouton-Rothschild Jeroboam Sold to an anonymous buyer at a Christie’s auction in 1997, this bottle comes from what is considered by wine enthusiasts to be one of the finest vintages of the 20th century. “Th.J” 1787 Chateau Lafitte A bottle of 1787 Chateau Lafitte which sold at Christie’s London in December of 1985, this wine was originally reported to be from the cellar of Thomas Jefferson, the former US President, and this most expensive bottle of wine had the initials Th.J etched into the glass bottle. It made its way into the hands of American tycoon Bill Koch, who became suspicious of the origins of the four bottles he had purchased. Eventually, he instigated the investigation that debunked the supposed origin of what was, at the time of purchase, the most expensive wine in the world. Shipwrecked 1907 Heidsieck These hundred year old bottles of Champagne from the Heidsieck vineyard in Champagne took over eighty years to reach their destination. Shipped to the Russian Imperial family in 1916, a shipwreck off the coast of Finland caused this champagne to be lost at sea until divers discovered over 200 bottles in 1997. Now they’re finally being sold—to wealthy guests at the Ritz-Carlton hotel in Moscow, at least. Of course, the wine’s extraordinary tale and incredible age are what makes it the world’s most expensive wine. |
Yahoo domains
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You can use standard word processing and drag-and-drop editing to build your web pages, so absolutely no programming knowledge is required!
And since you download SiteBuilder to your computer, you can work on your web site even when you're offline.
Learn more about how SiteBuilder can help you build a world-class web site.
Use Yahoo! SiteBuilder's customizable templates, royalty-free graphics, background colors, and clip art to design a world-class site.
For a quick start, choose from SiteBuilder's more than 380 web site templates. Use the templates as they are or customize them completely to get the site you want.
With total control over every template, you can personalize every aspect of your business or personal web site — from graphics to colors to layout.
Prefer to write your own code? Create your site from scratch using HTML or SiteBuilder's web page editing tools.
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LASIK in Dallas
At Carter Eye Center, we want you to achieve the best vision possible and we want you to have an eye care experience that is second to none. Our goal is to reinvent the LASIK experience, and we continue to work to make it even better for you.
Simply put, we focus on you. We provide:
* State-of-the-art eye surgery technology.
* Uncompromising and exceptional service.
Superior Service is not just a promise, it's a guaranty.
Dr. Harvey Carter has been delivering the most advanced eye surgery in Dallas, Texas for more than 20 years and is considered one of the top LASIK surgeons in the country. Dedicated to providing comprehensive and advanced solutions, Dr. Carter was the first FDA Investigator in North Texas to perform LASIK. He was the first surgeon in North Texas to perform Conductive Keratoplasty (CK). In fact, Dr. Carter was the first surgeon in the United States to perform Crystalens surgery after it was approved by the FDA.Consistently involved in research and new surgical technologies, Dr. Carter and his staff are committed to provide the best possible treatment for you - our patients.
At Carter Eye Center, your LASIK experience is guaranteed from the moment you walk in our door. We go above and beyond to ensure you receive the attention and care you deserve and that you achieve the best possible visual results.
Simply put, we focus on you. We provide:
* State-of-the-art eye surgery technology.
* Uncompromising and exceptional service.
Superior Service is not just a promise, it's a guaranty.
Dr. Harvey Carter has been delivering the most advanced eye surgery in Dallas, Texas for more than 20 years and is considered one of the top LASIK surgeons in the country. Dedicated to providing comprehensive and advanced solutions, Dr. Carter was the first FDA Investigator in North Texas to perform LASIK. He was the first surgeon in North Texas to perform Conductive Keratoplasty (CK). In fact, Dr. Carter was the first surgeon in the United States to perform Crystalens surgery after it was approved by the FDA.Consistently involved in research and new surgical technologies, Dr. Carter and his staff are committed to provide the best possible treatment for you - our patients.
At Carter Eye Center, your LASIK experience is guaranteed from the moment you walk in our door. We go above and beyond to ensure you receive the attention and care you deserve and that you achieve the best possible visual results.
Lasik Dallas
D Magazine - 'Best LASIK Surgeon'
When considering Lasik, you want the very best for your eyes. Dr William Boothe is not only the most experienced intralasik surgeon, but he has been awarded 'Best Lasik Surgeon' in Dallas multiple times from D Magazine. Dr Boothe continues to provide experienced and quality lasik in Dallas because at Boothe Eye Care & Laser Center, the patient is number one.
AMO Confirms Distinction
for Dr Boothe
Dr. Boothe has been confirmed as the highest volume, single site, single surgeon Intralase user in the world, by Abbott Medial Optics, Inc.
Consumers' Choice Award 2009
Boothe Eye Care & Laser Center is proud to announce it has won its fourth consecutive Consumers' Choice Award for Lasik in Dallas. We would like to thank everyone who voted for us in the category of Lasik and we plan to continue providing quality care for our Lasik patients.
50% OFF All Laser LASIK Surgery
for a Limited Time Only!
There is no better time than the present to eliminate or reduce your dependence on contact lenses and glasses. For a limited time only you can get 50% OFF all laser intralasik with the newest iFS technology from Dr. Boothe, the most experienced IntraLASIK surgeon in the world. Dr. Boothe will beat any price using the same technology and warranty period. Ask about zero percent financing for two years. Call 214-328-0444 for a free consultation to see if you are a candidate.
When considering Lasik, you want the very best for your eyes. Dr William Boothe is not only the most experienced intralasik surgeon, but he has been awarded 'Best Lasik Surgeon' in Dallas multiple times from D Magazine. Dr Boothe continues to provide experienced and quality lasik in Dallas because at Boothe Eye Care & Laser Center, the patient is number one.
AMO Confirms Distinction
for Dr Boothe
Dr. Boothe has been confirmed as the highest volume, single site, single surgeon Intralase user in the world, by Abbott Medial Optics, Inc.
Consumers' Choice Award 2009
Boothe Eye Care & Laser Center is proud to announce it has won its fourth consecutive Consumers' Choice Award for Lasik in Dallas. We would like to thank everyone who voted for us in the category of Lasik and we plan to continue providing quality care for our Lasik patients.
50% OFF All Laser LASIK Surgery
for a Limited Time Only!
There is no better time than the present to eliminate or reduce your dependence on contact lenses and glasses. For a limited time only you can get 50% OFF all laser intralasik with the newest iFS technology from Dr. Boothe, the most experienced IntraLASIK surgeon in the world. Dr. Boothe will beat any price using the same technology and warranty period. Ask about zero percent financing for two years. Call 214-328-0444 for a free consultation to see if you are a candidate.
Should You Refinance?
Refinancing can be a great financial move if it reduces your mortgage payment, shortens the term of your loan or helps you build equity more quickly. When used carefully, it can also be a valuable tool in getting your debt under control. Before you refinance take a careful look at your financial situation, and ask yourself: 'How long do I plan to continue living in the house?' and 'How much money will I save by refinancing?'
Again, keep in mind that refinancing generally costs between 3% and 6% of the loan's principal. It takes years to recoup that cost with the savings generated by a lower interest rate or shorter term. So, if you are not planning to stay in the home for more than a few years, the cost of refinancing may negate any of the potential savings It also pays to remember that a savvy homeowner is always looking for ways to reduce debt, build equity, save money and eliminate that mortgage payment. Taking cash out of your equity when you refinance doesn't help
Again, keep in mind that refinancing generally costs between 3% and 6% of the loan's principal. It takes years to recoup that cost with the savings generated by a lower interest rate or shorter term. So, if you are not planning to stay in the home for more than a few years, the cost of refinancing may negate any of the potential savings It also pays to remember that a savvy homeowner is always looking for ways to reduce debt, build equity, save money and eliminate that mortgage payment. Taking cash out of your equity when you refinance doesn't help
Tapping Equity and Consolidating Debt
While the previously mentioned reasons to refinance are all financially sound, mortgage refinancing can be a slippery slope to never-ending debt. It's important to keep this in mind when considering refinancing for the purpose of tapping into home equity or consolidating debt.
Homeowners often access the equity in their homes to cover big expenses, such as the costs of home remodeling or a child's college education. These homeowners may justify such refinancing by pointing out that remodeling adds value to the home or that the interest rate on the mortgage loan is less than the rate on money borrowed from another source. Another justification is that the interest on mortgages is tax deductible. While these arguments may be true, increasing the number of years that you owe on your mortgage is rarely a smart financial decision, nor is spending a dollar on interest to get a $0.30 tax deduction.
Many homeowners refinance in order to consolidate their debt. At face value, replacing high-interest debt with a low-interest mortgage is a good idea. Unfortunately, refinancing does not bring with it an automatic dose of financial prudence. In reality, a large percentage of people who once generated high-interest debt on credit cards, cars and other purchases will simply do it again after the mortgage refinancing gives them the available credit to do so. This creates an instant quadruple loss composed of wasted fees on the refinancing, lost equity in the house, additional years of increased interest payments on the new mortgage and the return of high-interest debt once the credit cards are maxed out again - the possible result is an endless perpetuation of the cycle of debt.
Homeowners often access the equity in their homes to cover big expenses, such as the costs of home remodeling or a child's college education. These homeowners may justify such refinancing by pointing out that remodeling adds value to the home or that the interest rate on the mortgage loan is less than the rate on money borrowed from another source. Another justification is that the interest on mortgages is tax deductible. While these arguments may be true, increasing the number of years that you owe on your mortgage is rarely a smart financial decision, nor is spending a dollar on interest to get a $0.30 tax deduction.
Many homeowners refinance in order to consolidate their debt. At face value, replacing high-interest debt with a low-interest mortgage is a good idea. Unfortunately, refinancing does not bring with it an automatic dose of financial prudence. In reality, a large percentage of people who once generated high-interest debt on credit cards, cars and other purchases will simply do it again after the mortgage refinancing gives them the available credit to do so. This creates an instant quadruple loss composed of wasted fees on the refinancing, lost equity in the house, additional years of increased interest payments on the new mortgage and the return of high-interest debt once the credit cards are maxed out again - the possible result is an endless perpetuation of the cycle of debt.
Converting between Adjustable-Rate and Fixed-Rate Mortgages
While ARMs start out offering lower rates than fixed-rate mortgages, periodic adjustments often result in rate increases that are higher than the rate available through a fixed-rate mortgage. When this occurs, converting to a fixed-rate mortgage results in a lower interest rate as well as eliminates concern over future interest rate hikes.
Conversely, converting from a fixed-rate loan to an ARM can also be a sound financial strategy, particularly in a falling interest rate environment. If rates continue to fall, the periodic rate adjustments on an ARM result in decreasing rates and smaller monthly mortgage payments, eliminating the need to refinance every time rates drop. Converting to an ARM may be a good idea especially for homeowners who don't plan to stay in their home for more than a few years. If interest rates are falling, these homeowners can reduce their loan's interest rate and monthly payment, but won't have to worry about interest rates eventually rising in the future.
Conversely, converting from a fixed-rate loan to an ARM can also be a sound financial strategy, particularly in a falling interest rate environment. If rates continue to fall, the periodic rate adjustments on an ARM result in decreasing rates and smaller monthly mortgage payments, eliminating the need to refinance every time rates drop. Converting to an ARM may be a good idea especially for homeowners who don't plan to stay in their home for more than a few years. If interest rates are falling, these homeowners can reduce their loan's interest rate and monthly payment, but won't have to worry about interest rates eventually rising in the future.
Shortening the Loan's Term
When interest rates fall, homeowners often have the opportunity to refinance an existing loan for another that, without much change in the monthly payment, has a shorter term. For that 30-year fixed-rate mortgage on a $100,000 home, refinancing from 9% to $5.5% cuts the term in half to 15 years, with only a slight change in the monthly payment from $804.62 to $817.08.
Securing a Lower Interest Rate
One of the best reasons to refinance is to lower the interest rate on your existing loan. Historically, the rule of thumb was that it was worth the money to refinance if you could reduce your interest rate by at least 2%. Today, many lenders say 1% savings is enough incentive to refinance.
Reducing your interest rate not only helps you save money, but increases the rate at which you build equity in your home, and can decrease the size of your monthly payment. For example, a 30-year fixed-rate mortgage with an interest rate of 9% on a $100,000 home has a principal and interest payment of $804.62. That same loan at 6% reduces your payment to $599.55.
Reducing your interest rate not only helps you save money, but increases the rate at which you build equity in your home, and can decrease the size of your monthly payment. For example, a 30-year fixed-rate mortgage with an interest rate of 9% on a $100,000 home has a principal and interest payment of $804.62. That same loan at 6% reduces your payment to $599.55.
Mortgages: The ABCs Of Refinancing
Refinancing a mortgage means paying off an existing loan and replacing it with a new one. There are many common reasons why homeowners refinance: the opportunity to obtain a lower interest rate; the chance to shorten the term of their mortgage; the desire to convert from an adjustable-rate mortgage (ARM) to a fixed-rate mortgage, or vice versa; the opportunity to tap a home's equity in order to finance a large purchase; and the desire to consolidate debt. Some of these motivations have both benefits and pitfalls. And because refinancing can cost between 3% and 6% of the loan's principal and - like taking out the original mortgage - requires appraisal, title search and application fees, it's important for a homeowner to determine whether his or her reason for refinancing offers true benefit.
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Monday, July 27, 2009
Second Quarter 2009 Financial Summary
Revenue and Expense
Revenue net of interest expense on a fully taxable-equivalent basis rose 60 percent to $33.1 billion compared with $20.7 billion a year ago.
Net interest income on a fully taxable-equivalent basis rose 9 percent to $11.9 billion from $10.9 billion in the second quarter of 2008 due to an improved rate environment and the addition of Countrywide and Merrill Lynch. These improvements were partially offset by a shift in loan mix and the sale of securities. Net interest yield narrowed 28 basis points to 2.64 percent due to the addition of lower yielding assets from Countrywide and Merrill Lynch, sales of securities, and a shift in loan mix, partially offset by the favorable rate environment.
Noninterest income rose to $21.1 billion from $9.8 billion a year earlier. Higher mortgage banking income, trading account profits and investment and brokerage services income reflected the addition of Merrill Lynch and Countrywide. Additionally, the increase was driven by a $5.3 billion pretax gain on the sale of CCB shares. Bank of America continues to own approximately 11 percent of the common shares of CCB. Noninterest income in the period also included a $3.8 billion pretax gain from the completed sale of the merchant processing business to a joint venture. These increases were partially offset by $3.6 billion in losses related to mark-to-market adjustments including the Merrill Lynch structured notes as a result of narrowing credit spreads during the quarter. Card income declined due to higher credit losses on securitized credit card loans and lower fee income.
Noninterest expense increased to $17.0 billion from $9.7 billion a year earlier. This reflects higher personnel and general operating expenses, driven in part by the Merrill Lynch and Countrywide acquisitions and the FDIC special assessment. Pretax merger and restructuring charges rose to $829 million from $212 million a year earlier.
The efficiency ratio on a fully taxable-equivalent basis was 51.44 percent compared with 46.60 percent a year earlier.
Pretax, pre-provision income on a fully-taxable equivalent basis was $16.1 billion compared with $11.1 billion a year earlier.
Credit Quality
Credit quality deteriorated further as the economic environment weakened. Consumers remained under significant stress as unemployment and underemployment increased and individuals spent longer periods without work. These conditions led to higher losses in almost all consumer portfolios compared with the prior quarter.
Declining home values and reduced spending by consumers and businesses negatively impacted the commercial portfolios resulting in broad-based increases in criticized and nonperforming loans. Commercial loan losses rose from the prior quarter as commercial domestic and small business portfolios were impacted in sectors dependent on discretionary consumer spending. Losses in the commercial real estate portfolio also increased.
The provision for credit losses was $13.4 billion, flat with the first quarter. Credit losses were higher than the prior quarter and reserves, which were increased by $4.7 billion, were added across most consumer portfolios and the commercial portfolio reflecting the impact of the weak economy. Nonperforming assets were $31.0 billion compared with $25.6 billion at March 31, 2009, reflecting the continued deterioration in economic conditions. The 2009 coverage ratios and amounts shown in the following table include Merrill Lynch.
Credit Quality
(Dollars in millions) Q2 2009 Q1 2009 Q2 2008
--------------------- ------- ------- -------
Provision for credit
losses $13,375 $13,380 $5,830
Net Charge-offs 8,701 6,942 3,619
Net Charge-off
ratios(1) 3.64% 2.85% 1.67%
Total managed net
losses $11,684 $9,124 $5,262
Total managed net
loss ratio(1) 4.42% 3.40% 2.16%
At 6/30/09 At 3/31/09 At 6/30/08
---------- ---------- ----------
Nonperforming assets $30,982 $25,632 $9,749
Nonperforming
assets ratio(2) 3.31% 2.64% 1.13%
Allowance for loan
and lease losses $33,785 $29,048 $17,130
Allowance for
loan and lease
losses ratio(3) 3.61% 3.00% 1.98%
(1) Net charge-off/loss ratios are calculated as annualized held net
charge-offs or managed net losses divided by average outstanding
held or managed loans and leases during the period.
(2) Nonperforming assets ratios are calculated as nonperforming assets
divided by outstanding loans, leases and foreclosed properties at
the end of the period.
(3) Allowance for loan and lease losses ratios are calculated as
allowance for loan and leases losses divided by loans and leases
outstanding at the end of the period.
Note: Ratios do not include loans measured at fair value in accordance
with SFAS 159.
Capital Management
Total shareholders' equity was $255.2 billion at June 30. Period-end assets were $2.3 trillion. The Tier 1 Capital ratio was 11.93 percent, up from 10.09 percent at March 31, 2009 and from 8.25 percent a year ago. The Tier 1 Common ratio was 6.90 percent, compared with 4.49 percent at March 31, 2009 and 4.78 percent at June 30, 2008. The Tangible Common Equity ratio was 4.67 percent, up from 3.13 percent at March 31, 2009 and 3.24 percent a year earlier. Tangible book value per share of common stock was $11.66, compared with $10.88 at March 31, 2009 and $11.87 a year earlier.
During the quarter the bank increased its Tier 1 common capital by nearly $40 billion, easily exceeding the $33.9 billion Supervisory Capital Assessment Program (SCAP) buffer set by the Federal Reserve in May. Actions contributing toward that goal during the quarter included: issuing shares of common stock; exchanging certain non-government preferred stock for common stock; the sale of a portion of shares in CCB; and the sale of the company's merchant processing business to a joint venture.
During the quarter, Bank of America issued 1.25 billion, or $13.5 billion, of common shares. Bank of America exchanged the equivalent of $14.8 billion of non-government preferred shares for approximately 1 billion shares of common stock through private exchanges and a tender offer. A cash dividend of $0.01 per common share was paid. The company recorded $1.4 billion in preferred dividends, partially offset by $576 million related to the exchange of preferred stock in the calculation of net income available to common shareholders. Period-end common shares issued and outstanding were 8.65 billion for the second quarter of 2009, 6.40 billion for the first quarter of 2009 and 4.45 billion for the year-ago quarter.
Revenue net of interest expense on a fully taxable-equivalent basis rose 60 percent to $33.1 billion compared with $20.7 billion a year ago.
Net interest income on a fully taxable-equivalent basis rose 9 percent to $11.9 billion from $10.9 billion in the second quarter of 2008 due to an improved rate environment and the addition of Countrywide and Merrill Lynch. These improvements were partially offset by a shift in loan mix and the sale of securities. Net interest yield narrowed 28 basis points to 2.64 percent due to the addition of lower yielding assets from Countrywide and Merrill Lynch, sales of securities, and a shift in loan mix, partially offset by the favorable rate environment.
Noninterest income rose to $21.1 billion from $9.8 billion a year earlier. Higher mortgage banking income, trading account profits and investment and brokerage services income reflected the addition of Merrill Lynch and Countrywide. Additionally, the increase was driven by a $5.3 billion pretax gain on the sale of CCB shares. Bank of America continues to own approximately 11 percent of the common shares of CCB. Noninterest income in the period also included a $3.8 billion pretax gain from the completed sale of the merchant processing business to a joint venture. These increases were partially offset by $3.6 billion in losses related to mark-to-market adjustments including the Merrill Lynch structured notes as a result of narrowing credit spreads during the quarter. Card income declined due to higher credit losses on securitized credit card loans and lower fee income.
Noninterest expense increased to $17.0 billion from $9.7 billion a year earlier. This reflects higher personnel and general operating expenses, driven in part by the Merrill Lynch and Countrywide acquisitions and the FDIC special assessment. Pretax merger and restructuring charges rose to $829 million from $212 million a year earlier.
The efficiency ratio on a fully taxable-equivalent basis was 51.44 percent compared with 46.60 percent a year earlier.
Pretax, pre-provision income on a fully-taxable equivalent basis was $16.1 billion compared with $11.1 billion a year earlier.
Credit Quality
Credit quality deteriorated further as the economic environment weakened. Consumers remained under significant stress as unemployment and underemployment increased and individuals spent longer periods without work. These conditions led to higher losses in almost all consumer portfolios compared with the prior quarter.
Declining home values and reduced spending by consumers and businesses negatively impacted the commercial portfolios resulting in broad-based increases in criticized and nonperforming loans. Commercial loan losses rose from the prior quarter as commercial domestic and small business portfolios were impacted in sectors dependent on discretionary consumer spending. Losses in the commercial real estate portfolio also increased.
The provision for credit losses was $13.4 billion, flat with the first quarter. Credit losses were higher than the prior quarter and reserves, which were increased by $4.7 billion, were added across most consumer portfolios and the commercial portfolio reflecting the impact of the weak economy. Nonperforming assets were $31.0 billion compared with $25.6 billion at March 31, 2009, reflecting the continued deterioration in economic conditions. The 2009 coverage ratios and amounts shown in the following table include Merrill Lynch.
Credit Quality
(Dollars in millions) Q2 2009 Q1 2009 Q2 2008
--------------------- ------- ------- -------
Provision for credit
losses $13,375 $13,380 $5,830
Net Charge-offs 8,701 6,942 3,619
Net Charge-off
ratios(1) 3.64% 2.85% 1.67%
Total managed net
losses $11,684 $9,124 $5,262
Total managed net
loss ratio(1) 4.42% 3.40% 2.16%
At 6/30/09 At 3/31/09 At 6/30/08
---------- ---------- ----------
Nonperforming assets $30,982 $25,632 $9,749
Nonperforming
assets ratio(2) 3.31% 2.64% 1.13%
Allowance for loan
and lease losses $33,785 $29,048 $17,130
Allowance for
loan and lease
losses ratio(3) 3.61% 3.00% 1.98%
(1) Net charge-off/loss ratios are calculated as annualized held net
charge-offs or managed net losses divided by average outstanding
held or managed loans and leases during the period.
(2) Nonperforming assets ratios are calculated as nonperforming assets
divided by outstanding loans, leases and foreclosed properties at
the end of the period.
(3) Allowance for loan and lease losses ratios are calculated as
allowance for loan and leases losses divided by loans and leases
outstanding at the end of the period.
Note: Ratios do not include loans measured at fair value in accordance
with SFAS 159.
Capital Management
Total shareholders' equity was $255.2 billion at June 30. Period-end assets were $2.3 trillion. The Tier 1 Capital ratio was 11.93 percent, up from 10.09 percent at March 31, 2009 and from 8.25 percent a year ago. The Tier 1 Common ratio was 6.90 percent, compared with 4.49 percent at March 31, 2009 and 4.78 percent at June 30, 2008. The Tangible Common Equity ratio was 4.67 percent, up from 3.13 percent at March 31, 2009 and 3.24 percent a year earlier. Tangible book value per share of common stock was $11.66, compared with $10.88 at March 31, 2009 and $11.87 a year earlier.
During the quarter the bank increased its Tier 1 common capital by nearly $40 billion, easily exceeding the $33.9 billion Supervisory Capital Assessment Program (SCAP) buffer set by the Federal Reserve in May. Actions contributing toward that goal during the quarter included: issuing shares of common stock; exchanging certain non-government preferred stock for common stock; the sale of a portion of shares in CCB; and the sale of the company's merchant processing business to a joint venture.
During the quarter, Bank of America issued 1.25 billion, or $13.5 billion, of common shares. Bank of America exchanged the equivalent of $14.8 billion of non-government preferred shares for approximately 1 billion shares of common stock through private exchanges and a tender offer. A cash dividend of $0.01 per common share was paid. The company recorded $1.4 billion in preferred dividends, partially offset by $576 million related to the exchange of preferred stock in the calculation of net income available to common shareholders. Period-end common shares issued and outstanding were 8.65 billion for the second quarter of 2009, 6.40 billion for the first quarter of 2009 and 4.45 billion for the year-ago quarter.
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