Clark Howard Show Notes – July 22, 2010
Today on the Clark Howard Show
Higher Unemployment Numbers
There were 464,000 initial claims for unemployment filed last week, a jump of 37,000 claims which was much higher than expected. Earlier in the week, the government reported that the economy lost jobs in June (on a net basis) for the first time all year. The lackluster jobs market means wages will be lower and more people will be unemployed for far longer. The Senate passed an extension of unemployment benefits through November, though capped the benefits at 99 weeks total. Only those who are unemployed in states with a state unemployment rate of 8.5 percent or higher will qualify for the extension of benefits.
Existing Home Sales Collapse
Sales of existing homes fell 5.1 percent in June to an average annualized rate of 5.37 million, according to a new report from the National Association of Realtors. The Realtors reported that in the wake of the expiration of the tax credits, they expect sales of existing homes to continue to fall. Despite lower prices and record low mortgageA Mortgage is a document granting a lien on a home in exchange for financing granted by a lender. The mortgage is the means by which the lender secures the loan and has the ability to foreclose on the home. rates (see below), the high unemployment rate and tighter lending standards are keeping many wanna-be home buyers out of the market.
Bernanke Says Future Uncertain, So Maintain Bush’s Tax Cuts
Federal ReserveThe Reserve is the amount of money set aside by a condo, co-op, or homeowners' association for future capital improvements. Chairman Ben Bernanke was not his usual optimistic self while making his semiannual congressional testimony. “This is the worst labor market, the worst episode, since the Great Depression.”
“Not only for the sake of the unemployed and for the short-term strength of the economy but also for a long-term viablity in the international competitiveness, I think we need to be very seriously concerned,” he said.
Recent economic data points to slowing growth, fanning fears of a double-dip recession. Bernanke painted a bleak picture for the millions of jobless workers and said the central bank would be ready to act if necessary.
This morning, Bernanke gave testimony that by extending President Bush’s tax cuts, we’d be stimulating the economy.. I guess that’s right – but you have a good test going on right now – this year (2010), there are no estate taxes owed, no matter how much money you leave behind.
So if extending the estate tax cuts is going to pump money into the economy, we should already be seeing that. George Steinbrenner died and his estate is saving $500 million by not having to pay taxes. Are we seeing a $500 million pump into the economy?
Mortgage Rates Fall Again
Freddie Mac reported that mortgage interestInterest is money charged for the use of borrowed funds. Usually expressed as an interest rate, it is the percentage of the total loan charged annually for the use of the funds. rates hit another record low, with the average 30-year fixed rate loanA Loan is an amount of money that is lent to a borrower, who agrees to repay it plus interest. at 4.56 percent. Zillow Mortgage Ticker reported that the average rate for a 30-year loan among its lenders was 4.37 percent. Mortgage brokers are quoting 3.85 percent and lower for 15-year loans.
Although I refinanced my loan last November at 4.25 percent for a 15-year fixed-rate loan, I’m thinking of doing it again. Should you be?
How To Profit From Foreclosures and Other Real EstateReal Estate is land and anything permanently attached to it, such as buildings and improvements. Investments
The ticket window is open for our latest event: How To Profit From Foreclosures and Other Real Estate Investments which will be held on October 2, 2010 at the
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Paying more on your credit card?
Credit card companies are raising fees for folks who have excellent credit. Why? Because folks are charging less (frugality reigns!) and they’re carrying smaller balances. Also, folks who could no longer afford their credit card bills are getting tossed and their accounts are being closed. So, credit card companies are turning to the folks who can afford higher fees and charging them. The Washington Post has a good story about how credit card companies are raising fees on those with great credit histories and scores.
Six Items or Less? Could you wear only six items of clothing for a month?
Two friends, one in New York and the other in London, decided to pare back their wardrobes. Could they survive on six items of clothing from their closet for a month? In other words, excluding underwear, socks, and shoes, could they wear just those six items of clothing or less and would anyone notice?
Great story about not only SixItemsOrLess.com but also about another fashion challenge site, TheGreatAmericanApparelDiet.com. TGAAD has bloggers who are walking you through their daily challenges with cutting back on their clothing budget and figuring out how to make do with what they have. It’s inspiring and entertaining. I thought you’d like to take a look.