June 2008

I love volunteering. I just got back from 3 hours of reading at the RFB&D where I enjoy spending some of my energy reading textbooks for blind students (today I learned how to direct readers and ran the recording technology).  Disabled folks can use our service too, including folks that cant turn the pages because of arthritis for example. Some students have been recently blinded and some were born blind. Either way, it’s very rewarding because of the impact on others. I’m going to join the Ambassador committee soon, so I thought I’d start by sharing some interesting facts with you about the program.

Where I volunteer, we serve Texas, Arkansas and Oklahoma. Pretty fun territory for a gal from Vermont to think about. Wonder what listeners think of my accent?

* In Texas alone, we have over 16,000 borrowers that have benefit from our services.  Nationally, Recording For The Blind & Dyslexic provides over 185,000 people with print disabilities the books they need to learn and succeed. 

* Currently over 700 Texas schools and districts are members of our service.

* Borrowers range from kindergarten-graduate students and continuing education. We have even helped a blind woman graduate successfully from acupuncture school!

*  We have a studio that has 7 recording booths. Everyone gets to direct!

* Johns Hopkins University evaluated the effectiveness of RFB & D’s (reading for blind and dyslexic) recorded textbooks, and found a 38% increase in content acquisition reading scores.

* Their goal (and mine too, which is why I volunteer here) is for all people to have access to the printed world. 


And if you’re in Texas, they’re just right up the street off of Lamar and 45th!


Economic Week in Review: Consumers grow gloomier

This week’s economic reports showed little signs of relief as the
consumer confidence index fell even lower than expected. Consumers
continue to be concerned over rising unemployment rates, historically
high gas prices, and the housing slump. On a brighter note, sales of
existing homes were up for the month, albeit still far below
historical averages. In other news, the Federal Reserve Board’s Open
Market Committee met this week and kept the target funds rate at 2.0%,
putting an end to an eight-month-long string of rate changes. For the
week, the S&P 500 Index fell 3.0% to 1,279 (for a year-to-date total
return of –12%). The yield of the 10-year U.S. Treasury note fell 17
basis points to 3.99%.

To read Vanguard(R) Economic Week in Review in its entirety, go to:

If the inflation rate grows faster than your investment’s rate of return, it can cause your savings–and your purchasing power–to erode. To maintain your purchasing power, you need to earn a rate of return higher than the inflation rate. Currently, the US inflation rate is about 4%. 

Unfortunately money isnt taught in school. If you go to college for finance, sure, but not in your everyday classroom at least. It’s tough to understand, and even more so because no one has a magic formula when it comes to creating a guaranteed, secure financial future. 

Lots of Americans can’t even think about the future because they’re worrying so much about today. It’s time to start investing in your future today. It’s only going to get tougher the longer you wait. Think about your whole financial picture and where you can cut back to ease up your cash flow to help get you further ahead, faster.

If you ever wonder:

How Do I…

When Should I…

What Happens If…

Why Should I…

Please let me know and I’ll see if I can help. If not, at the very least, I should be able to give you a referral to someone that could.

My 2 cents: Nice way to reward us savers and investors. Thanks a whole bunch for penalizing those of us trying to get ahead too. He says that he wont go over 28%! 28%!??? Tag on inflation and we’ll be losing over 30% on our money we are trying to earn.

By Jeanne Sahadi, CNNMoney.com senior writer, June 20, 2008 

Barack Obama has made one part of his plan for the capital gains tax perfectly clear: He wants to raise the rate above 15% for high-income investors.

But to what level: 20%? 23%? 27%? All Obama has said is that it would be at least 20% and less than 28%.


The choice the presumptive Democratic nominee for president makes will matter to investors and to federal coffers. It’s one of the many crucial tax details he and his advisers have yet to settle as they campaign against Republican rival John McCain.One reason Obama says he wants to raise the rate is to establish more fairness in the tax system. A low rate directly benefits high-income taxpayers the most since they hold more taxable investments than everyone else.

Yet Obama is also banking on revenue from a higher capital gains rate to help pay for some of his proposals, such as new tax cuts for less-than-flush families and a system to make health insurance affordable for all.

“What I want is not oppressive taxation. I want businesses to thrive,” he said in a Democratic presidential debate this spring.

So Obama knows he can’t afford to raise the tax so high that it stifles investment and the free flow of capital. But where’s that magic dividing line, above which he risks losing needed revenue and creating economic distortions in investor behavior?

The big debate

“They’ve been debating this question for at least 70 years,” said tax historian Joseph Thorndike.

Any change in capital gains rates can create a short-term boost in revenue since investors are more inclined to sell before a rate increase or soon after a rate decrease. But the long-term effects on revenue are more of a question mark.

Bob Carroll, a former Treasury official and now vice president for economic policy at the Tax Foundation, which favors a flat tax, said some research shows that somewhere between 26% and 28% is the level up to which the capital gains tax could increase revenue. But even at those levels, Carroll said, “there’d be significantly negative economic consequences.”

By that he means: the higher the rate, the longer investors are likely to hold onto their investments and the more likely it is their decision to sell or invest in a company will be based on the tax consequences rather than on the merit of the investment itself.

On the other hand, Tax Policy Center Director Len Burman, also a former Treasury official and author of the book “The Labyrinth of Capital Gains Tax Policy – A Guide for the Perplexed,” has done research suggesting that raising the capital gains rate even above 28% might not hurt revenue or create much negative distortion in investor behavior.

Theoretically, the capital gains tax “is the easiest tax in the world to avoid – simply don’t sell your assets,” he said. “But in the real world, there’s lots of selling. … [Either] people don’t pay that much attention to taxes, or they think they can beat the market so selling is worth the tax. In any event, my research suggests that capital gains are way less responsive to taxes than one might think.”

Narrowing his sights?

So, if Obama is looking for scientific clarity, he won’t get it. “There’s no empirically determinable bright line around this,” said Clint Stretch, managing principal of tax policy at Deloitte Tax.

Obama himself has virtually said that 20% to 25% is the real range he’s considering. “I talk to people like Warren Buffett or others and I ask them … how much of a difference is it going to be if it’s 20 or 25 percent. They say, look, if it’s within that range then it’s not going to distort, I think, economic decision-making,” he said in a CNBC interview.

And Obama occasionally makes it sound like he’s really aiming for the lowest end of that range, telling Fox News, “in terms of capital gains I’ve suggested we might go back up to 20 [percent].”

Maybe that’s the political pragmatist talking. At the end of the day, “it’s going to come down to politics,” Stretch said. And since many Democrats along with Republicans back the idea that lower rates encourage investment, the politics suggests he won’t be able to raise the tax above 25% and may not be able to get it much above 20% – where it’s scheduled under current law to be by 2011 unless lawmakers decide otherwise.

Ultimately, Stretch said, “There’s what Obama wants to do, and then there’s what he can get past Congress.”

A company’s MARKET CAPITALIZATION , aka MARKET CAP, is the total value of a company’s publicly traded stock. 

Market cap equals the number of publicly traded shares multiplied by the current share price. SO, let’s say a company with 10 million shares outstanding and a share price of $10. This company would have a market cap of $100 million.

The market cap fluctuates as it’s price moves up and down.

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