Tuesday, July 20, 2010

manage personal finances

Web technology has revolutionized finance by making it easier than ever to monitor cash flow and track trends in your spending. Mint.com has been a leader in this realm for personal finance: its technology helps you track multiple accounts, analyze spending trends, and manage financial goals.

There isn’t a clear counterpart to class='blippr-nobr'>Mintclass="blippr-nobr">Mint for businesses, though. That’s where inDinero, a Y-Combinator-funded startup, comes in.

inDinero, which launches today, is a web-based financial dashboard for small businesses. Like Mint, it aggregates financial data from bank accounts, investments, and other sources and places them in a simple, easy-to-navigate interface where you can quickly see your income, spending, recent activity, and your financial runway.

The app is divided into five parts: Dashboard, Income, Spending, Planning and Trends. Dashboard provides an overview of your business finances, Income provides detailed information about your income streams, Spending breaks down your different costs, Planning helps you set goals for your business, and Trends analyzes and graphs out spending and income trends in order to provide useful insights.

Businesses need this type of information in order to minimize costs while maximizing revenues. While solutions such as Mint also aggregate financial information and analyze it, they are not focused on small businesses. We look forward to seeing inDinero’s business toolset grow and evolve.

Image courtesy of iStockphotoclass="blippr-nobr">iStockphoto, jwohlfeil

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Five Best Personal Money Management Sites

Web-based financial management tools have grown in sophistication to the point where many people manage their entire financial lives with online tools. Here's a look at five of the most popular personal money management sites.

Photo a mashup of images by Leonardini and Wilton.

Earlier this week we asked you to share your favorite personal money management site; now we're back to highlight the five most popular contenders.

Click on the screenshots below to take a closer look.

Buxfer (Basic: Free, Premium: From $2.79/month)

Many people are hesitant to use online banking services because of security concerns. Buxfer's compromise to provide ease of use while also assuring users and keeping things as controlled as they would like is to offer multiple methods for storing your credentials. You can manually synchronize your financial accounts with the site, you can store your passwords and login credentials locally using Google Gears, Firefox, or Safari, or you can use the Firebux Firefox extension—Firebux helps you automate the process of downloading financial data from your banking institutions and reviewing Buxfer data. If you'd like to skip the hassle of handling your own syncing, Buxfer offers automatic nightly syncing of your financial data, automatically logging into and pulling data from your various online money portals. Buxfer comes in three flavors: Basic (free), Plus ($2.79 per month), and Pro ($3.79 per month). All accounts include features like split bills, automatic tagging, and mobile access, but you'll pay a premium for unlimited budgets, bill reminders, and balance projections. You can try a live demo of Buxfer here.

Yodlee MoneyCenter (Free)

As many readers were quick to point out, Yodlee provides the guts to the user sites for hundreds of banking and financial services. Organizations like Mint, Thrive, and large banks like Chase use rebranded but Yodlee-powered interfaces. Yodlee users will often characterize Yodlee as similar to Mint, but without such a strong emphasis on flashy graphics. Instead it focuses more on analyzing your raw data—transaction descriptions, for example, are easier to search and more detailed. Yodlee can import data from thousands of institutions, help you generate a budget, automate your bill paying, and send out user-defined alerts. If you like the idea of a site like Mint but want more fine-grained control and the ability to manually tweak things when necessary, Yodlee is a solid alternative.

Mint (Free)

Mint has risen to prominence as a major player among web-based financial management tools by putting an extreme emphasis on user-friendliness and automation. The focus on automation is so strong, in fact, they only recently added the ability to add in any sort of manual transactions. By providing Mint with your various logins, you can track all your financial accounts in one place—checking, savings, credit cards, investments—and easily generate budgets and projections based off your data. Mint has won many people over, especially in the younger demographic, by being the first tool they've used to really get a good look at their money and where it's going.

ClearCheckbook (Basic: Free, Premium: $4/month)

ClearCheckbook is a web-based checking account ledger on steroids. You can track your spending, input your daily expenses from the web-interface or from your iPhone, Android, or Palm, and generate a budget with spending limits. Upgrading to a premium account gets you a custom report tool, custom transaction fields, future balance projection, and editing of the auto-suggest feature. Visit ClearCheckbook at the link above to check out the video tours of both the free and premium accounts—available at the bottom of the main page.

Mvelopes ($39.60/quarter)

Mvelopes is a robust web-based financial tool built on the old principle of budgeting with envelopes—each budget category gets an envelope with a set amount of money. Its focus on an old budgeting technique, however, doesn't mean you're stuck with dated tools. Mvelopes automatically pulls transaction data from hundreds of financial institutions, supports automatic bill payment, and helps you generate snapshots of your net worth as you adjust your budget and goals. Mvelopes is notable for being the only contender in the Hive without a free account option, a testament perhaps to how happy people are with the service that it made an appearance in the top five despite the lack of free-as-in-beer option.

Now that you've had a chance to look over the top five contenders for best personal money management sites, it's time to cast a vote for your favorite:

Have a favorite web-based tool that didn't get a nod or want to talk up your favorite a bit more? Let's hear it in the comments. Have an idea for the next Hive Five? Send us an email at tips@lifehacker.com with "Hive Five" in the subject line and we'll do our best to get your idea the attention it deserves.

Send an email to Jason Fitzpatrick, the author of this post, at jason@lifehacker.com.

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Many people find managing their finances to be a boring chore. After all, It does take some time to make a budget, pay the bills, and reconcile your accounts and you have to do it every month. Money management software can help with these tasks and can provide very useful information about your finances. There are many different software packages available on the market but they all have one thing in common: they make it easy to manage your money.

With money management software you can track your spending. This is done by either downloading your information directly from your bank into the software, or by entering the information yourself based on receipts that you've saved and bills that you've paid. Either way, money management software provides a way to capture the information so you can use it in financial reports and to help control your spending. You can easily assign categories to your transactions which allows you to see how much you are spending each month on certain budget items such as groceries, entertainment, utilities, etc.

Money management software also helps you to prepare and monitor your budget. A budget is important because it is a method you can use to reduce excess spending, and is a vehicle for achieving your financial goals whether they be to pay down debt, buy a home, or save for retirement. When you use money management software the program walks you through setting up a budget. From there it is easy to keep your budget updated.

Another benefit of money management software is that you can track your credit card expenses. It is important to keep on top of what you owe so you can manage your debt wisely. The software has the ability to present information in graph form so you can see your debt to total net worth ratio. By tracking all of your credit cards and loans on money management software, you will easily be able to see how much in total you owe.

Money management software also helps you to keep your accounts up to date and reconciled. No more spending long hours on trying to get the checkbook balanced. An additional benefit includes the fact that you can also track your investments with money management software.

Analyzing your personal finances is also very easy with money management software. Most software packages give you the option of running monthly, quarterly or yearly reports including cash flow reports, net worth reports, and itemized category reports that help you see how much you are spending on a particular item, how your investments are doing, and what your tax situation is.

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Disgraced USDA Official Blames Fox News and Tea Party For Her ...

The USDA employee that was forced to resign Monday as a result of racist comments she made at an NAACP gathering in March has blamed Fox News and the Tea Party for her inability to convince her employers of her innocence. ...

Ali Larter Baby News! at The Insider

Ali Larter Baby News! ... Home � News � Videos � Movies � Photos � Celebrities � Obsessions � Games � Congratulations! July Newly Weds � Stars show off Celebrity Entertaining � NEW You Choose Lara's Look � Celebrities On Motorcycles ...

Hyperlocal News Site Fwix Debuts Local Trend Search

Fwix, a news site that offers a stream of hyperlocal, realtime news by location, is launching a new portal today that aims to give anyone a real time view of what's happening in a location. You can access the new search portal here.

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Monday, July 19, 2010

budgeting personal finances

Five Best Personal Money Management Sites

Photo a mashup of images by Leonardini and Wilton.

Earlier this week we asked you to share your favorite personal money management site; now we're back to highlight the five most popular contenders.

Click on the screenshots below to take a closer look.

Buxfer (Basic: Free, Premium: From $2.79/month)

Yodlee MoneyCenter (Free)

Mint (Free)

ClearCheckbook (Basic: Free, Premium: $4/month)

Mvelopes ($39.60/quarter)

Now that you've had a chance to look over the top five contenders for best personal money management sites, it's time to cast a vote for your favorite:

Send an email to Jason Fitzpatrick, the author of this post, at jason@lifehacker.com.

What a fantastic basic concept.

Hitler lost the second world war because he attacked Russia too soon. udervise ve vood all be speeking Deutsch now.

We employed the alternative massively effective budgetting tool.

Be a self employed Engineer for 15 years with take home pay of £50K a year and spend it all (and more besides, because ‘I want one of those NOW’) because ‘my jobs safe’.

Watch as the banks destroy the worlds finances.

Suddenly realise that over 90% of British industry is ultimately owned by Japanese investment banks, who suddenly have no money to fulfill their legal obligations to complete legislation driven improvment projects.

Watch as my £50K a year take home falls to ZERO.

Start a brand new business with Kleeneze (sorry not available in the USA) Which although it’s building really well is , after all, a business and needs time.

Suddenly HAVE to live on £18K a year GROSS.

Best Motivation for re-inventing your budget that anyone can have LOL.

We used to spend about £1,000 a month on groceries, now we spend around £300 a month, AND we eat more healthily.

Fortunately the finance on my car ended a month after our income disappeared saving us £375 a month.

We’ve sold my wifes’ car (THAT hurt) it was a really nice car, but it was costing us £489 a month in finance.

We’ve moved to a cheaper house saving us £400 a month in rent.

We’ve cancelled everything that wasn’t absolutely essential - including SKY and the TV license (It’s true, you don’t die if you turn the telly off!)

We still have creditors who we’re negotiating reduced payments and frozen interest with, but basically we are starting again from scratch.

We won’t fall into the credit trap again

Certainly not in the next six years or more ‘cos no-one in their right mind will give us credit now anyway!!

The one thing that keeps coming back to me though is

WHY aren’t our schools teaching kids how to budget? It’s a thousand times more important than even the basics.

Who cares if you can’t spell budgit if you can make one and stick to it.

It CAN’T be one of the things that are left to parents because nobody ever taught us!

Back to subject,

Your article is brilliant and if it helps one person (which I’m sure it already has) to get out or stay out of debt then you’ve done a service to humanity.

Keep it up &

we’ll see you

OVER the top

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Clearcheckbook.com is a relatively new web site, started in 2006 by Brandon O'Brien. The web site's budgeting features are useful for anyone looking for ways to control finances, but it is especially geared towards people who prefer a simple, intuitive program for budgeting and money management. Unlike some personal finance software programs, Clearcheckbook is straight forward, easy to learn and easy to use. And it's free!

Account Features

You can create as many accounts as you want on Clearcheckbook.com. Accounts are created and edited easily. Clearcheckbook.com does not link to your bank account; instead, you enter transactions yourself. This is an advantage to many people, because it places the budgeting process in your own hands: you can keep better track of your personal finances by taking a more active role in tracking your budget.

Budgeting Features

Clearcheckbook.com has many useful budgeting features. It allows for the creation of categories. You can define and edit as many categories as you need, from groceries to entertainment. After you create your categories, you can impose spending limits on each category. This feature allows you to carefully monitor your expenditures so that you do not spend over your budget.

Clearcheckbook.com also allows you to place a spending limit for each account. If you want to be sure you do not overspend on one account, you can quickly type in your limit. Colorful indicators let you know when you are reaching your limit; they turn orange as you near your limit and red when you reach it.

You can also set up reminders for bills or upcoming transactions, as well as set up recurring transactions.

Adding Entries

After you log into your Clearcheckbook.com account, you will be brought to your Account Summary page. Here you can see the balances of each of your accounts, as well as your most recent transactions. On this page you'll find the Quick Add Entry tool. Here you can add transactions, citing the date, place, amount, category, type (deposit/withdrawal), and account. The budgeting website also allows for split entries, easing the process of entering correct categories for individual transactions.

Importing/Exporting Records

If you have used other personal finance software and wish to import you records into clearcheckbook.com, you can easily do so by using the import tool. QIF, OFX, and QFX files are suported.

Reports

Good budgeting practice requires that you review and analyze your spending. Clearcheckbook.com has a section for Reports, where you can view your expenditures in terms of graphs and and charts. The charts are easy to read and printable.

Mobility

For some people, using budgeting software can be difficult in managing their personal finances because it is a process that is somewhat detached; in other words, you do not review your finances at the time you're shopping, instead, you sit down once a week or so and enter your transactions, only to find you overspent sometime during the week. One of the great features about Clearcheckbook.com is its mobility. Using their integrated CheckBot program, you can check your account balances, spending limits, and even add deposits and withdrawals, all from the convenience of your cell phone. Clearcheckbook.com has a list of codes that you can text message in order to view your account. With CheckBot, you can immediately see where your personal finances stand.

Conclusion

Because Clearcheckbook.com is so new a website, there are sometimes some small bugs that need to be worked out. But the features keep getting better and better. And even if you do run into a technical problem, send an email to the administrator. In my personal experience, I have had every email answered politely and quickly. The developer is also excellent at integrating user suggestions into new versions of the personal finance software. If you're looking for a way to easily keep on top of your budget, try Clearcheckbook.com. It's free, so you have nothing to lose!

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This Won't Hurt A Bit - Science News

Vaccination patch could make immunizations ouchless.

Robin Hood 702 Strikes Again « Liveshots

On a blistering hot Friday morning in Las Vegas, Nevada, an unusual crew strolls out the VIP.

Muhammad Cartoon Activist Molly Norris Lands on al-Qaida Hit List

(July 12) -- Molly Norris, the American cartoonist who started Everybody Draw Mohammad Day, has been placed on the hit list of radical Muslim cleric Anwar al-Awlaki.

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Friday, July 16, 2010

managing personal finances

Elon Musk, the CEO of electric-car startup Tesla Motors and rocket-launcher SpaceX, should be applauded for the mighty challenges he’s taken on and the powers of persuasion he has deployed to build his companies. But along the way, he discovered that he could stretch the truth, casually and frequently, as a shortcut to getting things done.

Clad in a sheen of bubbly optimism, his mendacity nonetheless has consequences. Through Tesla’s IPO, he has now taken hundreds of millions of dollars from taxpayers and public investors who expect not just a return but square dealing from the man who is managing their company for them.

So where has Musk spun the facts?

Critical reporting

Well, let’s go with the most recent one: He’s lied about me, and VentureBeat, apparently in retaliation for our aggressive and accurate reporting.

In an article published by the Huffington Post, he calls me “Silicon Valley’s Jayson Blair.” He accused me of making errors, but never once specified them. Here’s the truth: I cited Musk’s own words from court filings, which we had paid a freelance reporter to find and copy, legally, from a courthouse in Van Nuys, Calif. I also interviewed a host of other sources. I emailed Musk questions and called his lawyer repeatedly before publishing. We went to extra lengths to nail down the facts: Before publishing, VentureBeat editor-in-chief Matt Marshall called Musk and had interviews with at least three Tesla board members.

We make no apologies for seeking the truth about Tesla Motors and Elon Musk, a vital company and an iconic entrepreneur of Silicon Valley. Our reporting (here’s one example of our series) helped investors get a more truthful picture of a company that was going public and the man behind it.

Musk also accused me of “collaborating” with the lawyer representing Justine Musk, his ex-wife, in their divorce case. Also false: I picked up the phone and called her lawyer, and he had the courtesy to answer my questions.

Now, we should all be used to Musk insulting journalists who don’t report what they’re told to. But calling someone a “Jayson Blair” is a troubling assertion to anyone who prefers his insults to have a factual basis.

When I ran fact-checking at Business 2.0 magazine, here’s what I would have asked the writer to prove before I’d let him get away with that kind of factual assertion: So, you want to compare this Owen Thomas person to one of journalism’s most infamous miscreants. Is Owen Thomas a drug addict? Is Owen Thomas mentally unstable? Has Owen Thomas plagiarized or invented facts? The answer to all of those, in case you were curious, is no.

And so out comes the chief of reporters’ red pen.

The one specific claim Musk made about my reputation was that I had written that he was broke. Not true. If you review the story I reported on his personal finances and their impact on Tesla, you’ll see I merely quoted Musk’s own words from his divorce filing, in which he said that he “ran out of cash.”

When VentureBeat first started raising questions about Musk’s personal finances, his expensive divorce case, and the impact they might have on Tesla’s IPO, a Tesla spokesman initially said that the company had no plans to update its IPO prospectus to reflect our reporting. However, in the end, Tesla updated its SEC filings to acknowledge substantially all of the concerns we raised as potential risk factors investors should consider.

That is the ultimate correction of the record, and it stands today.

Musk’s personal spending

There are other whoppers in Musk’s piece, such as the suggestion that of the $200,000 per month he’s spending, a mere $30,000 a month is going to his own personal household expenses, with the rest going to legal fees in his divorce case. Actually, the figure he told a court is $98,023 a month, according to filings in that case, including $50,000 a month in rent.

The founding of Tesla Motors

An aside to Musk: Making false statements is something the law frowns on.

Oh, but wait, Musk should already know that. He and I met in San Francisco in 2008 for drinks, and over the course of the evening, he made several disparaging remarks about Tesla Motors cofounder Martin Eberhard’s management of the company before Musk had ousted him as CEO — specifically, Musk alleged, for misrepresenting the cost of making the Tesla Roadster. In 2009, Eberhard sued Musk for defamation, citing the comments Musk had made to me, among others. Musk filed a scathing response to the lawsuit, repeating many of his negative claims about Eberhard.

Then it headed to mediation, and the case was settled. Eberhard’s lawyer declared himself “very pleased” with the result, and Tesla issued a press release in which Musk said that Eberhard had been “indispensable” to the company in its early days.

The safety of customers’ deposits

When Tesla’s finances were at their most perilous, in the winter of 2008 and spring of 2009, the company was dependent on advance reservation payments from customers for cash flow. The company’s cash balance had run down to $9 million, and the company was struggling to raise $40 million in convertible debt. (He announced that that round had closed in November 2008, while in fact, according to Tesla’s SEC filings, it did not close until March 2009.) To raise funds in the meantime, Tesla began taking deposits on the Model S sedan, even though that car was far from production, and continued taking deposits on Roadsters. Musk first told customers that he would personally guarantee the deposits they were placing, “even in the worst case of an Armageddon scenario.” Then he said that their deposits were completely at risk and they could lose all their money. One of those statements had to be false.

Musk’s history as an entrepreneur

In persuading other investors to back Tesla Motors, Musk has frequently traded on his past success as an entrepreneur at companies like Zip2 and PayPal. But Zip2 was so troubled that one of its venture capitalists, Derek Proudian, had to step in as acting CEO, a move rarely seen at venture-backed companies. And Musk was ousted as CEO of PayPal by his own management team. To this day, Musk tells a version of PayPal’s history that few who were there at the time agree with.

Tesla’s investors

Most dangerously, Musk has repeatedly made misrepresentations about Tesla’s finances. In February 2009, he sent a letter to customers saying that Tesla would start getting funds from a Department of Energy loan in four to five months. In fact, it had not received the loan at that point and there was no certainty it would get it, a point a Tesla spokeswoman had to clarify. (Tricky, that, saying your CEO had misrepresented the facts without calling him a liar.)

He also said Tesla would turn profitable in 2009. Of course, it didn’t, as the company’s published financials later revealed. (Musk later claimed, using questionable accounting whose details have never been revealed, that the company had been profitable for one month of the year.)

In an interview for the May 2009 issue of Car and Driver, he told that magazine’s readers that General Electric had become an investor. It hadn’t, and it never did, according to Andy Katell, a GE spokesman who spoke with me at the time.

The Toyota deal

After unveiling an agreement to buy the NUMMI plant in Fremont, Calif., from the Toyota-backed joint venture which owned it, Musk claimed that Tesla and Toyota planned to jointly develop several models of cars and build them at NUMMI. It’s true that he got Toyota CEO Akio Toyoda to stand next to him and make grand promises. But in fact, as the company later revealed in its SEC filings, Tesla and Toyota had no agreement to develop any cars, and there was no guarantee that they ever would.

The pity of it all is this: I don’t believe Musk twists the truth out of malice. Rather, at this point, it may well be out of habit. He’s so used to getting his way that future possibilities just seem like present realities to him. And pragmatically, it’s worked. Whenever Tesla has been in a bind, Musk has spun his way out of trouble.

It’s a character trait of which elements are found among many successful entrepreneurs: the compelling presentation of an alternate reality in the hopes that so many people will sign on to the vision that it comes true. Apple CEO Steve Jobs, for example, is so masterful at this that people speak of his reality distortion field. But Musk may have taken distortion to extremes.

The question now is whether Musk’s past habits will serve him well as the CEO of a publicly traded company. Already, it seems the investors who have entrusted Musk with hundreds of millions of dollars are having doubts. With shares of Tesla having already fallen by nearly half since their post-IPO pop, perhaps Musk’s bubble is finally deflating.

But those who are still sticking with the company should ask themselves this: Has Tesla adequately disclosed to investors the risk of its CEO’s curious relationship with the truth?

Next Story: Blizzard Entertainment relents on the use of real names in comments for its game forums Previous Story: Toyota: We’re already building a car to test Tesla’s battery

Elon Musk, the CEO of electric-car startup Tesla Motors and rocket-launcher SpaceX, should be applauded for the mighty challenges he's taken on and the powers of persuasion he has deployed to build his companies. But along the way, he discovered that he could stretch the truth, casually and frequently, as a shortcut to getting things done.

Clad in a sheen of bubbly optimism, his mendacity nonetheless has consequences. Through Tesla's IPO, he has now taken hundreds of millions of dollars from taxpayers and public investors who expect not just a return but square dealing from the man who is managing their company for them.

So where has Musk spun the facts?

Critical reporting

Well, let's go with the most recent one: He's lied about me, and VentureBeat, apparently in retaliation for our aggressive and accurate reporting.

In an article published by the Huffington Post, he calls me "Silicon Valley's Jayson Blair." He accused me of making errors, but never once specified them. Here's the truth: I cited Musk's own words from court filings, which we had paid a freelance reporter to find and copy, legally, from a courthouse in Van Nuys, Calif. I also interviewed a host of other sources. I emailed Musk questions and called his lawyer repeatedly before publishing. We went to extra lengths to nail down the facts: Before publishing, VentureBeat editor-in-chief Matt Marshall called Musk and had interviews with at least three Tesla board members.

We make no apologies for seeking the truth about Tesla Motors and Elon Musk, a vital company and an iconic entrepreneur of Silicon Valley. Our reporting (here's one example of our series) helped investors get a more truthful picture of a company that was going public and the man behind it.

Musk also accused me of "collaborating" with the lawyer representing Justine Musk, his ex-wife, in their divorce case. Also false: I picked up the phone and called her lawyer, and he had the courtesy to answer my questions.

Now, we should all be used to Musk insulting journalists who don't report what they're told to. But calling someone a "Jayson Blair" is a troubling assertion to anyone who prefers his insults to have a factual basis.

When I ran fact-checking at Business 2.0 magazine, here's what I would have asked the writer to prove before I'd let him get away with that kind of factual assertion: So, you want to compare this Owen Thomas person to one of journalism's most infamous miscreants. Is Owen Thomas a drug addict? Is Owen Thomas mentally unstable? Has Owen Thomas plagiarized or invented facts? The answer to all of those, in case you were curious, is no.

And so out comes the chief of reporters' red pen.

The one specific claim Musk made about my reputation was that I had written that he was broke. Not true. If you review the story I reported on his personal finances and their impact on Tesla, you'll see I merely quoted Musk's own words from his divorce filing, in which he said that he "ran out of cash."

When VentureBeat first started raising questions about Musk's personal finances, his expensive divorce case, and the impact they might have on Tesla's IPO, a Tesla spokesman initially said that the company had no plans to update its IPO prospectus to reflect our reporting. However, in the end, Tesla updated its SEC filings to acknowledge substantially all of the concerns we raised as potential risk factors investors should consider.

That is the ultimate correction of the record, and it stands today.

Musk's personal spending

There are other whoppers in Musk's piece, such as the suggestion that of the $200,000 per month he's spending, a mere $30,000 a month is going to his own personal household expenses, with the rest going to legal fees in his divorce case. Actually, the figure he told a court is $98,023 a month, according to filings in that case, including $50,000 a month in rent.

The founding of Tesla Motors

An aside to Musk: Making false statements is something the law frowns on.

Oh, but wait, Musk should already know that. He and I met in San Francisco in 2008 for drinks, and over the course of the evening, he made several disparaging remarks about Tesla Motors cofounder Martin Eberhard's management of the company before Musk had ousted him as CEO -- specifically, Musk alleged, for misrepresenting the cost of making the Tesla Roadster. In 2009, Eberhard sued Musk for defamation, citing the comments Musk had made to me, among others. Musk filed a scathing response to the lawsuit, repeating many of his negative claims about Eberhard.

Then it headed to mediation, and the case was settled. Eberhard's lawyer declared himself "very pleased" with the result, and Tesla issued a press release in which Musk said that Eberhard had been "indispensable" to the company in its early days.

The safety of customers' deposits

When Tesla's finances were at their most perilous, in the winter of 2008 and spring of 2009, the company was dependent on advance reservation payments from customers for cash flow. The company's cash balance had run down to $9 million, and the company was struggling to raise $40 million in convertible debt. (He announced that that round had closed in November 2008, while in fact, according to Tesla's SEC filings, it did not close until March 2009.) To raise funds in the meantime, Tesla began taking deposits on the Model S sedan, even though that car was far from production, and continued taking deposits on Roadsters. Musk first told customers that he would personally guarantee the deposits they were placing, "even in the worst case of an Armageddon scenario." Then he said that their deposits were completely at risk and they could lose all their money. One of those statements had to be false.

Musk's history as an entrepreneur

In persuading other investors to back Tesla Motors, Musk has frequently traded on his past success as an entrepreneur at companies like Zip2 and PayPal. But Zip2 was so troubled that one of its venture capitalists, Derek Proudian, had to step in as acting CEO, a move rarely seen at venture-backed companies. And Musk was ousted as CEO of PayPal by his own management team. To this day, Musk tells a version of PayPal's history that few who were there at the time agree with.

Tesla's investors

Most dangerously, Musk has repeatedly made misrepresentations about Tesla's finances. In February 2009, he sent a letter to customers saying that Tesla would start getting funds from a Department of Energy loan in four to five months. In fact, it had not received the loan at that point and there was no certainty it would get it, a point a Tesla spokeswoman had to clarify. (Tricky, that, saying your CEO had misrepresented the facts without calling him a liar.)

He also said Tesla would turn profitable in 2009. Of course, it didn't, as the company's published financials later revealed. (Musk later claimed, using questionable accounting whose details have never been revealed, that the company had been profitable for one month of the year.)

In an interview for the May 2009 issue of Car and Driver, he told that magazine's readers that General Electric had become an investor. It hadn't, and it never did, according to Andy Katell, a GE spokesman who spoke with me at the time.

The Toyota deal

After unveiling an agreement to buy the NUMMI plant in Fremont, Calif., from the Toyota-backed joint venture which owned it, Musk claimed that Tesla and Toyota planned to jointly develop several models of cars and build them at NUMMI. It's true that he got Toyota CEO Akio Toyoda to stand next to him and make grand promises. But in fact, as the company later revealed in its SEC filings, Tesla and Toyota had no agreement to develop any cars, and there was no guarantee that they ever would.

The pity of it all is this: I don't believe Musk twists the truth out of malice. Rather, at this point, it may well be out of habit. He's so used to getting his way that future possibilities just seem like present realities to him. And pragmatically, it's worked. Whenever Tesla has been in a bind, Musk has spun his way out of trouble.

It's a character trait of which elements are found among many successful entrepreneurs: the compelling presentation of an alternate reality in the hopes that so many people will sign on to the vision that it comes true. Apple CEO Steve Jobs, for example, is so masterful at this that people speak of his reality distortion field. But Musk may have taken distortion to extremes.

The question now is whether Musk's past habits will serve him well as the CEO of a publicly traded company. Already, it seems the investors who have entrusted Musk with hundreds of millions of dollars are having doubts. With shares of Tesla having already fallen by nearly half since their post-IPO pop, perhaps Musk's bubble is finally deflating.

But those who are still sticking with the company should ask themselves this: Has Tesla adequately disclosed to investors the risk of its CEO's curious relationship with the truth?

Originally posted at VentureBeat.

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Balloon Juice » Blog Archive » News break

61 Responses to “News break”. 1. July 15th, 2010 at 5:12 pm. Joseph Nobles. Somebody's getting laid tonight. Reply. 2. July 15th, 2010 at 5:13 pm. beltane. There is already a diary up at GOS about how the Goldman Sachs settlement is ...

Small Business News: The Better Business Owner | Small Business Trends

Who is the better business owner? Could it be you? Today we realize that it is not so much money or the right connections that make a business succeed in the.

Thursday, July 15, 2010

foreclosure defense

[Ed. note: This post is authored by Evan Jowers and Robert Kinney of Kinney Recruiting, sponsor of the Asia Chronicles. Kinney has made more placements of U.S. associates and partners in Asia than any other firm in the past two years. You can reach them by email: asia at kinneyrecruiting dot com.]

** Check out our new daily Asia biglaw blog at THEASIACHRONICLES.COM! **

Evan here. While PRC firms, Korean firms and Japanese firms have for years successfully recruited US biglaw associates, in ’09 such recruitment was more successful than usual. There are two reasons for this trend: i) most top US firms in Asia were on hiring freeze throughout ’09, making it extremely difficult for even the most impressive US associates to lateral to a US practice in Asia in ’09 (such lateral moves did happen, most with Kinney involved, but not in great number, relative to ’06, ’07, ’08 and ‘10); and ii) there has been a feeling in the market in the past couple of years that some local firms in Asia, especially PRC firms, are catching up to US practices there.

We know a number of US associates who made the move from top 10 US firms to PRC firms in ’09 (some with Kinney’s help). We also know a handful of US associates from top tier US firms that moved to Korean and Japanese local firms in ’09. This type of lateral move has been a good one for those looking for more of an entrepreneurial role early on in their career, especially if they have very strong personal connections at banks and other relevant entities in the target country. However, this type of move has been a bad one for those who are focused on keeping their technical skill set at a top US practice level of sharpness (in order to open up career doors now and in the future).

Unfortunately, most lawyers realize at some point that the skill set is paramount in importance in a legal career, typically coming ahead of even client control when working at top-tier firms. Having joined a local firm, it is very difficult to move from a local firm back to a top US firm, even within the same market where the associate has been getting unique major domestic firm experience. This is true, even if (in that market) US associate lateral hiring has picked up tremendously (which is the case in HK / China this year).

In fact, just in the past month, five mid-level to senior associates, whom I had worked with in the past, over a period of years, contacted me in order to try to move from their local firm back to a US firm. This year, we have taken numerous such calls from associates at Japanese, Korean and especially PRC firms. Some of these associates did choose a local firm offer over a US or UK firm offer when they moved from US to Asia last year. Others took a local firm offer after not being able to land a US or UK firm offer during last year’s very slow hiring market in Asia.

The complaints have been the same. They knew going in that the local firm would pay much less than the NYC market, but the expectation was that they would be promoted to income partner very quickly (in most cases, even a 3rd or 4th year can be on a very short non-equity partner track), albeit at still lower than US biglaw pay for same class year. However, once on the ground at their new firm for several months, these people often realized that, while they are working on the biggest deals in the market, their local firm is tasked with a far less sophisticated part of the deal than their counterparts (and friends) at the top US practices working across from them on the same project. They also find that many of the junior income partners at their firm who came from a top US firm are not so happy, due to their skill set dulling and the need to bring in clients in order to have further advancement.

Now, with that said, for some US associates that have made the move to a local firm, things could not have gone any better. Yes, for the most part (especially at PRC firms) the promise to quick promotion to non-equity partner comes through. Further, for those with great personal connections in China, Japan or Korea, being at such local firms allows such connections and entrepreneurial drive to be rewarded much sooner than would be the case at a top US practice.

Thus, for some, this type of move is a very rewarding one. Unfortunately, though, for many US associates that have made this type of lateral move and regret it, it can be very difficult to get back on board the top US firm career track, where technical skill sets are constantly sharpened and where great exit options to in-house or business positions are available if need be.

Frankly, hiring partners at top US practices in Asia consider it a red flag that a candidate left US biglaw for a local firm recently, simply because it is strong evidence that the candidate is not at all focused on a US biglaw career and may not be sophisticated enough to recognize the quality differences in legal work product. For example, some of my candidates who had multiple interviews and offers in ’09 from US or UK firms in Asia, but chose a local firm, now have trouble even getting a screen interview from the same US and UK firms that pursued them in ‘09. This is somewhat remarkable considering that the number of openings for US associates in Asia at US and UK firms have increased more than 10 fold this year, compared to ’09.

Further, if a candidate has been at a local firm for more than a year, hiring partners at US practices consider their skill set no longer sharp and thus a risky hire (especially when, as is the case today, there are so many well qualified US associate candidates on the market in Asia).

In the top US firm practice track in Asia, there no doubt will be opportunities to be entrepreneurial and this type of character trait is very important at US practices overseas (much more so than in US markets or London, for example), but it is not the same level as in local firms.

If you are at a top US practice in Asia, you can always make the move to local firms, but it will be very hard to make the opposite move. So our suggestion is that you think long and hard about what is the best timing for you to make such a move if you are seriously considering it at this time. For some it is a great move, but for many it should have been delayed for a number of years.

If you value most your biglaw skill set being sharpened and thus opening career doors, then stay in US practices while overseas, but if you value more getting out there and opening doors through your contacts and entrepreneurial skills, then it may be time for a move to a local firm.

Before making such a move, listen to all the warnings you will get from well informed and experienced people you talk to. You will get the warnings, but when someone is making an exciting career move, to their home country and with new fancy title no less, it can sometimes be hard to listen to anyone that has less than a positive reaction. Usually, family members and friends (who are not in biglaw) will strongly recommend going with the big title at the local firm, whereas US partners and former US biglaw associates who made similar moves will give words of caution.

US associate candidates for Asia often discount the advice of their current biglaw partners on the theory that they are not neutral, but they fail to recognize that they are leverage and marketing material at the local firms, and thus the advice they get from those local partners should also be discounted.

Parents and friends, most of whom are not in biglaw and many are not highly educated or experienced to begin with, will often say what they think you want to hear. Family and friends not experienced in biglaw will only see the surface – you are working long hours and have title of associate instead of vice president or partner. Also, family and friends native to your home country will likely believe that their local firms are rapidly catching up to US and UK firms and will within a few years take most of the international and US related work from foreign firms in their market (could not be further from the truth, unless you are looking decades down the road).

Try not to let your excitement and enthusiasm cloud what should be an informed decision. After all, choosing the local firm route in an informed way is a great move. There are pluses and minuses after all and you need to look at both, not just the former. When you stare the negatives of a move in the face and choose to go through that door anyways, you will have more mojo entering your new firm and will have no regrets.

Mysterious Second Pipe in Blowout Preventer Acknowledged

http://dailyhurricane.com/2010/07/mysterious-second-pipe-in-blowout-preventer-acknowledged.html

Yesterday, the Coast Guard and BP acknowledged that there was a second piece of drillpipe stuck in the blowout preventer that is now complicating the installation of the latest effort to contain the blowout well.

==> Very interesting: Second pipe may have crippled BP well’s defense mechanism *>June 29, 2010 Exclusive: How Steven Chu Used Gamma Rays to Save the Planet

http://www.theatlantic.com/science/archive/2010/05/exclusive-how-steven-chu-used-gamma-rays-to-save-the-planet/56685/

By using penetrating gamma rays you can see whether the valves were closed.

Very high-energy gamma rays can penetrate several inches of steel.

==> http://www.georgewashington2.blogspot.com/

The discovery suggested that the force of the erupting petroleum from BP’s well on April 20 was so violent that it sent pipe segments hurtling into the blowout preventer, like derailing freight cars.

It also offered a tantalizing theory for the failure of the well’s last line of defense, the powerful pinchers called shear rams inside the blowout preventer that should have cut the pipe and stopped the rising oil and gas from reaching the Deepwater Horizon 5,000 feet above. Drilling experts say those rams, believed to be partially deployed, could have been thwarted by the presence of a second pipe.

The doubled-up drill pipe joins a list of clues that is helping scientists understand the complexities of the Deepwater Horizon accident, and from that, craft changes in how deep-water drilling is conducted.

“We still don’t really know what’s in” the well wreckage, said Energy Secretary Steven Chu, whose team discovered the second pipe using gamma-ray imaging. He added: “If there were two drill pipes down there when the shear rams closed, or two drill pipes below, is it possible that in the initial accident … there was an explosive release of force?…Did it buckle and snap?…The more we know about this, the better we can know what to do next.”

While the DOE is only referring to drill pipe and not well casing, many experts have said that the well casing was destroyed also.

Indeed, the government is making back-up plans in case the relief wells don’t work. As the New York Times reported yesterday:

BP and government officials are now talking about a long-term containment plan to pump the oil to an existing platform should the relief well effort fail. While such a failure is considered highly unlikely, the contingency plan is the latest sign that with this most vexing of engineering challenges — snuffing a gusher 5,000 feet down in the gulf — nothing is a sure thing.

lest

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Wednesday, July 14, 2010

1 internet marketing

By Tess Alps: Why is TV-dissing such a big part of internet orthodoxy? Clay Shirky has been out promoting his new book, Cognitive Surplus, which states that internet activity is displacing TV among the young and that this is a good thing. There have been newspaper reviews like this and yesterday he was interviewed on Radio 4’s Today programme.

To be fair to Shirky, he doesn’t say that all TV is “bad”, but he believes that being online is better – connecting, creating, sharing. I would have to be a philistine not to recognise the many positive benefits that the internet has brought us, and I share Shirky’s idealistic hope that it will promote democracy, knowledge, peace, love etc.

My problems with his book are three-fold: I dispute some of his facts, some of the distinctions that he draws and some of the science that he employs.

Facts first: is TV viewing declininTo be fair to Shirky, he doesn’t say that all TV is “bad”, but he believes that being online is better – connecting, creating, sharing. I would have to be a philistine not to recognise the many positive benefits that the internet has brought us, and I share Shirky’s idealistic hope that it will promote democracy, knowledge, peace, love etc.

My problems with his book are three-fold: I dispute some of his facts, some of the distinctions that he draws and some of the science that he employs.g for the first time ever among the young? Not in the UK or Europe, and TV catch-up services online are extra. TV viewing is booming in developing markets. Anyone who has watched the World Cup coverage will have been moved to see young African children joyfully watching their first TV football match.

Secondly, to position the internet as an alternative to TV is meaningless – and I don’t say that lightly, because Clay Shirky is clearly a very intelligent person. The internet is a vast and transformational technology, but it is not a homogenous medium.

Many human activities that once took place offline can now be conducted online, including watching TV. A growing percentage of young people’s time online is spent watching TV and video – and then talking about it, as a quick glance at Twitter will prove. Sadly, there is about a 1:99 ratio between people who create things online and those who just consume them, much as in the real world; and TV inspires online creativity.

Finally, a bit of science. The word “passive” is often used to denigrate TV viewing. There might be less physical movement than twitching with a mouse but the brain is deeply engaged watching TV. The brain is a complex organism; the very title of Shirky’s book indicates he overvalues rational and cognitive processes over emotional intelligence and education; action over feelings.

We have just finished some neuroscientific research looking at the difference in the brain activity between watching TV and browsing websites (largely text based) and the differences are marked. TV is much stronger in areas such as emotion and long-term memory encoding and web browsing is stronger for visual attention. So they are different – but complementary.

Watching TV is a mostly shared experience; the real-life conversations within families that TV provokes are enormously valuable. Entertaining people and promoting happiness is a noble pursuit; TV is the master. But we should also recognise TV’s vast role as an informer, educator and promoter of democracy every bit as important as the internet.

Most of the time, the ease that the internet brings to human endeavour is brilliant, but I can think of areas where it has casualised and arguably cheapened some things. What’s the exchange rate between an online click on a petition and a Jarrow marcher? Birthday wishes on Facebook take a mere two seconds.

I could reverse what Shirky does and make unfair comparisons between the best of TV and the worst of the internet: is it better to watch Survival and Dispatches or to play to World of Warcraft and poke a friend? But I’d rather value both these massive cultural treasures for all the good they can do, separately and together.

Tess Alps is chief executive of Thinkbox, the marketing body for UK commercial TV

My problems with his book are three-fold: I dispute some of his facts, some of the distinctions that he draws and some of the science that he employs.

Tess Alps is chief executive of Thinkbox, the marketing body for UK commercial TV

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Friday, July 9, 2010

foreclosure investing

Hard to say who the worst member of Congress is. But there are few short lists that would exclude narrow-minded and extremist Minnesota religious fanatic Michele Bachmann. However, today isn't about Bachmann. You want Bachmann, you go to DumpBachmann; no one does it better. At the time of the 2008 election, Bachmann was just as odious as she is today. Blue America didn't get involved in that race though because her opponent simply seemed... "better than Bachmann." That standard is too low for us.

And today we're going to meet state Senator Tarryl Clark (below in the comments section), a hard working leader with a proven track record who would be a great candidate whether she were running against Michele Bachmann, or just some garden variety Republican.

People say this suburban/exurban district mostly north of the Twin Cities is too red for a Democrat. But that isn't true. Bush won it in 2004 with 57% and 4 years later McCain took 53% but, the district has also voted to elect Amy Klobuchar to the Senate-- and against Mark Kennedy, the kook who represented the district before Bachmann. And in the 15th senatorial district near St Cloud, the part Tarryl represents-- and which was a GOP bastion before she came along-- the vote totals in that 2006 race were very interesting. Because she knows what it means to work hard and work smart, and with a very committed Wellstone-style of campaigning, Tarryl outpolled everyone on the ballot:

Clark 15581 (56.30%)

Klobuchar 14980 (53.45%)

Pawlenty 14307 (51.1%)

Wetterling 13082 (46.81%)

Bachmann 12542 (44.88%)

MN-06 has the most devastating unemployment rate in Minnesota and the worst foreclosure crisis in the state. But Bachmann has neither understood nor been sympathetic to her constituents finding themselves in a jam because of the vicissitudes of an economy buffeted by disastrous conservative ideological experimentation. She has not only not contributed to finding solutions to these very real problems, she has tried to capitalize of politicizing them.

Tarryl's reaction, as a state legislator, has been the exact opposite. Instead of running around the country and ranting and raving at tea parties, she proven herself an effective leader for the people she represents, working to secure the funds to upgrade the facilities at Saint Cloud State University, working to ensure Central Minnesota’s nursing homes are paid fairly, working to establish a special law enforcement unit to fight gang activities in Central Minnesota.

Tarryl’s been a champion for issues including early childhood and higher education, health care, serving veterans, protecting Minnesotans from predatory lenders, and investing in the local communities that make America strong. Because of that her colleagues elected her to serve as the Senate’s Assistant Majority Leader. Bachmann's colleagues have recognized her as a clown and have tasked her with going on Fox to stir up divisiveness and animosities.

Tarryl’s record of results on reducing unemployment:

• Created 22,000 jobs with last session’s bonding bill

• Helped small businesses add new jobs with Angel Investor Tax Credits

• Authored the Central Minnesota Bioscience Initiative to bring jobs in the biotech industry into the 6th district

• Authored economic development bill that improved workforce development (job training) and expanded the Small Business Growth Acceleration Program, and entrepreneur and small business development grants.

Tarryl’s record of results on reducing foreclosure:

• Authored legislation to protect seniors from predatory lenders and reverse mortgages

• Helped families in keep their homes with the MN Subprime Borrowers Relief Act

• Authored legislation to reduce the burden of property taxes on middle class families

Tarryl is the newest member of the Blue America family. If you can volunteer for her campaign, there's a sign up form here and if you can help the campaign financially, she's on the Blue America endorsed candidates list.

About-Face by Rosalyne Shieh and Weatherizing by Catie Newell.

It's no secret that houses can be acquired for cheap in Detroit—as low as $500 if you attend the Wayne County Tax Foreclosure Auction. With property so easy to acquire, a new question surfaces: what should be done with them? Many are dilapidated from disuse, burnt-out with no plumbing or electrical wiring to speak of, despite being located in partially occupied neighborhoods. Prior 'cheap-house' projects have made polemical, visual statements that call out the urban blight in Detroit. Five teaching/research fellows from the University of Michigan's Architecture Department have approached their $500 house a little differently, using it as a testing ground for their ideas about architecture and domestic space.

The house was purchased at the above-mentioned Wayne County Auction, and is located near Hamtramck, in the same neighborhood that community-focused Design99 built their recently blogged Neighborhood Machine. Over the past year, Ellie Abrons, Meredith Miller, Thomas Moran, Catie Newell, and Rosalyne Shieh have been rehabilitating the property, rewiring it for electricity and investing in new windows, for example. At the same time, they've tested their own ideas about new ways to experience and occupy this house, building them right into the existing architecture, reflected in the title of the project: Five Fellows: Full Scale. Now that their fellowships are over and the project is complete, the deed has been turned over to Design99 for further development and use.

Mike Fuljenz Mike Fuljenz

Friday, July 2, 2010

foreclosure listings

From a report emailed to me over the weekend:

At the core of the foreclosure-prevention strategy is ignoring delinquencies. The percentage of older delinquent loans not yet in foreclosure is startling: 60% have at least 12 missed payments, and 35% have at least 18 missed payments. Add to this that three-fourths of delinquent loans are not in foreclosure, and we see that hidden losses well exceed those in the open.

Uh, they're not being "ignored" - this is systemic and intentional fraud.

Remember, these loans are either being held by someone or securitized into some sort of package. When you have a loan that has no chance of "curing" (to cure a loan with 12 missed payments the borrower would have to come up with the 12 payments to bring it current!) that loan should be carried at its recovery value - that is, the value of the collateral that can be seized and sold, LESS the cost of eviction, remediation and resale.

Does anyone recall all the entries I've written about getting competent legal and accounting (tax) advice before proceeding with any sort of action regarding walking away, short sales or foreclosure? This same report says:

Many homeowners would be better off going into foreclosure, than doing a short sale. Short sales are fraught with potential legal, credit, and complicated tax issues. For example, someone who refinanced could owe capital gains taxes, which are not forgiven under federal and California temporary debt relief acts. In the foreclosure route, borrowers can live in their house mortgage-free for at least one year, maybe two years. Both short sales and foreclosures are reported as “account not paid in full”, and are equally damaging to a credit score. An exception exists if short sellers can negotiate better terms with their lender on recourse liens. The other possible advantage to a short sale is the ability to get a mortgage again in 2 years (Fannie, Freddie), rather than having to wait 3-5 years after a foreclosure.

Homeowners pursue short sales, unaware of the problems they are creating for themselves. Their agents never warned them of deficiencies, ruined credit, taxes due on forgiven debt, or legal consequences. Agents made flowery promises to get listings, and now the lawsuits are starting.

No, really? You mean that people in the real estate business are less than truthful with their clients? That would never, ever happen with licensed professionals, right?

Then there's this, which I also have written about:

Another gray area is junior lien holders asking buyers for additional payments. As the market improved, juniors were no longer content with $3k thrown to them from the senior. They now want 10% of the junior note. They argue the additional payment is legal practice because the payment is made to escrow and appears on the HUD-1. However, they are actually hoping the senior lien holder does not read the HUD-1. The California Association of REALTORS® position is that all payments made by the buyer or agent in the purchase of a short sale must be part of the written short sale agreement signed by the senior lien holder. Concealing payments from seniors is loan fraud, and omitting these payments from the HUD-1 closing statement may violate RESPA. Some seniors reinstate their security interests because of the fraud. It’s surprising that the biggest banks are responding, when pressed on the fraud of their request, “just do it if you want the deal done”.

Right. Big banks saying "just do it"? Why would they do that? Is it so they can re-instate their security interests? No, nobody would ever do anything that hoses the consumer, would they? Naw.....

Few people understand that the bank that gave them their mortgage turned around and sold it into a mortgage bond, and the “bank” on their mortgage statement is actually a servicer.

Actually, it's a bit more complicated than that.

As I've been working on (and writing on) for a long time, and as a few attorneys are now starting to understand, the entirety of this process was corrupted and is rife with outright fraud from top to bottom.

Let's go through a (partial) list of the problems:

From a report emailed to me over the weekend:

At the core of the foreclosure-prevention strategy is ignoring delinquencies. The percentage of older delinquent loans not yet in foreclosure is startling: 60% have at least 12 missed payments, and 35% have at least 18 missed payments. Add to this that three-fourths of delinquent loans are not in foreclosure, and we see that hidden losses well exceed those in the open.

Uh, they're not being "ignored" - this is systemic and intentional fraud.

Remember, these loans are either being held by someone or securitized into some sort of package. When you have a loan that has no chance of "curing" (to cure a loan with 12 missed payments the borrower would have to come up with the 12 payments to bring it current!) that loan should be carried at its recovery value - that is, the value of the collateral that can be seized and sold, LESS the cost of eviction, remediation and resale.

Does anyone recall all the entries I've written about getting competent legal and accounting (tax) advice before proceeding with any sort of action regarding walking away, short sales or foreclosure? This same report says:

Many homeowners would be better off going into foreclosure, than doing a short sale. Short sales are fraught with potential legal, credit, and complicated tax issues. For example, someone who refinanced could owe capital gains taxes, which are not forgiven under federal and California temporary debt relief acts. In the foreclosure route, borrowers can live in their house mortgage-free for at least one year, maybe two years. Both short sales and foreclosures are reported as “account not paid in full”, and are equally damaging to a credit score. An exception exists if short sellers can negotiate better terms with their lender on recourse liens. The other possible advantage to a short sale is the ability to get a mortgage again in 2 years (Fannie, Freddie), rather than having to wait 3-5 years after a foreclosure.

Homeowners pursue short sales, unaware of the problems they are creating for themselves. Their agents never warned them of deficiencies, ruined credit, taxes due on forgiven debt, or legal consequences. Agents made flowery promises to get listings, and now the lawsuits are starting.

No, really? You mean that people in the real estate business are less than truthful with their clients? That would never, ever happen with licensed professionals, right?

Then there's this, which I also have written about:

Another gray area is junior lien holders asking buyers for additional payments. As the market improved, juniors were no longer content with $3k thrown to them from the senior. They now want 10% of the junior note. They argue the additional payment is legal practice because the payment is made to escrow and appears on the HUD-1. However, they are actually hoping the senior lien holder does not read the HUD-1. The California Association of REALTORS® position is that all payments made by the buyer or agent in the purchase of a short sale must be part of the written short sale agreement signed by the senior lien holder. Concealing payments from seniors is loan fraud, and omitting these payments from the HUD-1 closing statement may violate RESPA. Some seniors reinstate their security interests because of the fraud. It’s surprising that the biggest banks are responding, when pressed on the fraud of their request, “just do it if you want the deal done”.

Right. Big banks saying "just do it"? Why would they do that? Is it so they can re-instate their security interests? No, nobody would ever do anything that hoses the consumer, would they? Naw.....

Few people understand that the bank that gave them their mortgage turned around and sold it into a mortgage bond, and the “bank” on their mortgage statement is actually a servicer.

Actually, it's a bit more complicated than that.

As I've been working on (and writing on) for a long time, and as a few attorneys are now starting to understand, the entirety of this process was corrupted and is rife with outright fraud from top to bottom.

Let's go through a (partial) list of the problems:
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Tuesday, July 20, 2010

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Monday, July 19, 2010

Five Best Personal Money Management Sites

Buxfer (Basic: Free, Premium: From $2.79/month)

Yodlee MoneyCenter (Free)

Mint (Free)

ClearCheckbook (Basic: Free, Premium: $4/month)

Mvelopes ($39.60/quarter)

Friday, July 16, 2010

Thursday, July 15, 2010

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