How To Find Your Unclaimed Money

November 23, 2008 by · 4 Comments
Filed under: Business, Finance and Investment 

Unclaimed Money - $100 Bills

In the aftermath of a global financial crisis, people are having to make greater efforts to make ends meet and support their families. People are working extra hours, reducing their household spending to improve their cashflow and selling things to reduce debt.

But I am sure that many people would be struggling a whole lot less if they found and retrieved their unclaimed money! In Australia alone, over $500 million dollars in unclaimed money is being held in trust by ASIC and other government bodies.

This article explains where unclaimed money comes from and tips of searching and retrieving money that you may own.
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New Appearance

November 18, 2008 by · Leave a Comment
Filed under: Announcements 

You may have noticed that the appearance of the blog has changed – I am testing new themes for Here’s Trouble, as I was never fond of the default ‘Kubrick theme’ that comes with WordPress. This current one is a 3-column theme called ‘Revolution Code Blue’ by Brian Gardner.

What do you think ot this theme ? Please leave a comment here or on the contact page.

Women Falsely Claiming Paternity Benefits

The Child Support Assessment Act was recently amended to allow men who have been falsely paying child support payments to apply to recover their money. This has generated much controversy:

Paternity Tests Prove Hundreds of Men Duped

SMS after DNA test: You’re not the father

Australian men’s group seeks tests before child support

There is no doubt that the decision of a man and a women to have intercourse requires considerable understanding of the potential consequences.

The obligation of a father to financially support his child is clearly established in law. The retired tennis champion, Boris Becker, learnt this valuable lesson after being forced to pay millions of dollars for a child conceived during a brief liaison with a waitress in a restaurant broom closet in 1999.

Similarly, the responsibility of the woman to be truthful about her relationships is equally serious.  A women knows exactly whom she has slept with and would certainly know if there is any doubt about paternity.

To extract money out of an innocent person by making false claims of paternity is a very serious matter which also has serious consequences on the other party, both psychological and financial

  • It is a gross betrayal of trust
  • It is traumatic for the man and the child. The man may have formed a close emotional bond to a child, only to find out that he is not the father
  • A man may be deprived of his livelihood for almost two decades until the child reaches adulthood and becomes independent

Apparently, some feminist groups are up in arms stating that the only person that will suffer will be the child. To this, I say that the same argument could apply to a woman who obtains support money by robbing a bank or stealing from her workplace. Does this make her any less culpable for the crime? Of course not.

So not only do I fully support this reform – I feel it should be made even stronger in the following ways:

  • In the case of false paternity, child support money must be repaid WITH INTEREST to compensate for the man’s lost opportunities
  • Mandatory DNA testing of both parents and children must be performed in all custodial disputes
  • Where there has been a proven element of deception or fraud on the part of the woman who has falsely claimed child support, she should be subject to all applicable criminal law concerning fraud and theft
  • In the above case, the man should also be entitled to seek civil damages as considered appropriate for the case

What are your thoughts?

Kevin Rudd’s $6.2 Billion Auto Industry Package

November 14, 2008 by · 1 Comment
Filed under: Australian News, Australian Politics 

Australian Prime Minister Kevin Rudd announced a $6.2 billion dollar package to support the Australian Car Industry. This was after foreign owned car manufacturers announced plans to shut down local production in the wake of the global financial crisis.

$500 million of this money will be set aside for a ‘Green’ car innovation fund, to produce environmentally friendly vehicles.

The intentions of this plan are certainly noble. Australia has a proud history of automotive production. The industry employs many people who hold a lot of valuable know-how.

These are the problems I see with the plan:

1. It’s a large amount of money and it may only temporarily defer the problem. Foreign manufacturers will milk the government funds, artificially boosting their profits, then shut down the factories when the money has been exhausted.

2. Australian automotive tariffs are set to fall from 10% to 5% making it harder for our local industry to remain viable in the presence of low cost German, Japanese and Korean imports. Would we be merely sustaining an uncompetitive local industry out of pride?

Here are some possible alternatives:

1. Assist Australian entrepreneurs in buying out the local arms of these manufacturing firms, to ensure that the industry is under Australian ownership and that profits remain in this country.

Perhaps a new Australian company can focus on producing low cost, energy efficient vehicles that would offer something unique and provide a competitive edge on the market.

2. Use the money to pay for redundancies for these workers and retraining to allow them to get job in other industries where their skills can be adapted, e.g. Agricultural technology, military vehicles

What are your thoughts? Your comments are most encouraged.

Female Egyptian Lawyer Advocates Sexual Harassment of Israeli Women

November 13, 2008 by · Leave a Comment
Filed under: Middle-East Affairs 

This has to be one of the most sickening things I have see for a while:

In a media interview, a female Egyptian Lawyer, Nagla Al-Imam, recommends that Arab Men Should Sexually Harass Israeli Women, as a tactic to achieve territorial gains in the Arab-Israeli conflict. Nagla Al-Imam actually advises Arab men to tell Israeli Women that they should “leave the land so we won’t rape you”.

See the video here:

http://www.memritv.org/clip/en/1903.htm

This was provided courtesy of the Middle East Media Research Institute’s TV Monitoring project, MEMRI TV, who work tirelessly to translate Middle-Eastern newspapers, radio and television broadcasts into English, so that people in the West can see what people in that part of the world truly think, and not what the cowardly mainstream media choose to report.

I say to Nagla Al-Imam and other fanatics like her: human rights are UNIVERSAL and nobody, regardless of political belief, race or religion deserves to be subject to such humiliating and degrading treatment.

Your actions will only set back the cause of Women’s rights in the Arab-Islamic world and promote hostility towards Arabs in Western countries.

I would expect prompt condemnation of her statements from Human Rights Watch and Feminists groups around the world, but I am not holding my breath.

NSW State Government – Worse than a Desperate Crack Addict?

In a predictable move, the NSW state government, led by Nathan Rees, has cancelled several major rail infrastructure projects – namely, the North West Metro and the Richmond Line duplication, which has been ‘deferred‘.

These had been promised for many years and are needed to cope with the growing population in these areas. Housing has become highly unaffordable in inner-city Sydney, so people were encouraged to move to the outer areas in the expectation that the these Government transport projects, when completed, would be able to take them to their places of employment in the inner city.

The government of course states that these projects, which they previously claimed to be ‘fully funded’, have to be abandoned due to the budget ‘black hole’ created by the financial mismanagement of the past NSW Labor governments led by Morris Iemma and Bob Carr, and the global financial crisis which has led to reduced tax revenue.

Despite having cancelled these projects, the NSW government is desperate for cold hard cash and is prepared to sell all the public assets they can at any price. The latest assets up for sale are the electricity retailers, NSW Lotteries and Waste Services NSW. These are all profitable and income-generating.

One major reason cited by the state government for refusing to borrow money for infrastructure is that they want to maintain their ‘AAA’ credit rating. Correct me if I’m wrong, but isn’t the whole purpose of having credit ratings in the first place to allow reliable borrowers to obtain loans on good terms?

Now is the perfect time for the government to spend borrowed money. NSW is in recession and the economy needs to be stimulated – capital works projects have been historically effective in these situations.

Reviving the cancelled infrastructure projects will remove bottlenecks and lead to increased taxation revenue and economic growth. As we are are now in a higher inflation environment, the net present value of future loan payments will keep falling, reducing the future costs of servicing these loans.

Furthermore, keeping those public assets will ensure that their income is retained, and this income will of course reduce the burden of loan repayments.

Barack Obama wins US 2008 Presidential Election

I’m sure it came as no surprise to many that the Democratic candidate Barack Obama, defeated his Republican opponent, John McCain in the US general elections last week.

As an outsider I will make the following comments:

It appears that McCain’s faux pas was having Sarah Palin as his running mate. In my opinion, the Republican’s decision to have a female vice president was a gimmick needed to counter the Democrat’s choice of a black president, i.e. promoting the emancipation of black people vs promoting the emancipation of women. Unfortunately, the Republicans did not appear to choose a suitably qualified person and Palin quickly became an object of ridicule in the media.

Considering the current financial crisis and ongoing international conflicts, the incumbent party would have needed to make a superhuman effort to retain power – that made things easier for the Democrats.

I do hope that Barack Obama will prove to be a good leader and not just the outcome of an ‘affirmative action’ mindset.

My concerns at the moment are that the new Government will go soft on fighting religious fundamentalism and preventing the nuclear arming of fanatical regimes like Iran. Russia and China may continue to gain power and influence, unhindered by US intervention.

Stop Internet Censorship in Australia

The Australian Labor Party Senator Stephen Conroy, Minister for Broadband, Communications and the Digital Economy, has put together a plan to censor all Internet traffic in Australia with the stated intention of protecting children from pornography and blocking “illegal material”.

It is my opinion that this plan is completely unnecessary and serves merely as a distraction from the real issues affecting our country at this point in time. It is also a huge waste of money, with $44 million being budgeted in this financial year alone, with more to be spent in the following years.

The are a number of readily available options available today to concerned parents. These include PC software packages, routers with in-built filtering, and Internet Service Providers who offer optional filtering services on a per-account basis.

Australians will not be able to opt out of this scheme – we will only be able to choose between a ‘child-friendly’ setting or an ‘illegal content’ setting. What is illegal or child friendly will of course be determined by the government. It has not been discussed how one would get an incorrectly blocked site removed from the list.

The adoption of Conroy’s plan will result in web browsing being slowed considerably due to the overhead of filtering.

Filtering technology is known to be highly ineffective. A recent Tasmanian trial showed that a significant number of innocent pages were falsely blocked, and similarly, a significant number of ‘child unsafe’ pages (1 in 13 clicks) got through.

Apart from the inaccuracy of the filtering, its overall impact is highly limited – it appears that the filter will only be applied to HTTP (web) traffic. P2P networks such as BitTorrent will not be filtered. Even the HTTP filtering can be easily bypassed using any number of off-shore anonymous proxy servers and VPN gateway.

If you don’t want Internet censorship forced upon you, contact your local Federal MP and let them know. If you don’t know who that is, this site should help:

http://apps.aec.gov.au/esearch
 
And if you want to complain to Senator Conroy, here is his contact page:

http://www.aph.gov.au/senate/senators/homepages/senators.asp?id=3L6
 
The following sites are leading the campaign to oppose the filtering scheme and have detailed information:
 
http://nocleanfeed.com/
http://www.somebodythinkofthechildren.com/

Investing in Gold Made Easy

October 26, 2008 by · 1 Comment
Filed under: Business, Finance and Investment 

Many people like to own some gold. It’s a shiny yellow metal and brings up romantic images of Pirates, Spaniards, the Wild West, James Bond Movies, Fort Knox, Bullion, Nuggets and Jewellery.

It also has a reputation for being stable and immune to the inflation and devaluation that affect fiat (paper) currencies. Wars and economic uncertainty almost always spark interest in the metal.

I personally don’t care much for gold as an investment because it generates no income, but a reader asked for my opinion on what are the most convenient and cost-effective ways to invest in gold.

I consider the following methods to be the most convenient due to their accessibility, ease of use and relatively low fees. I must note that I have never personally used them.

Exchange-Traded Gold Bullion Securities

These are listed stocks that allow investors to buy a share in an allocation of gold that is held by a trustee in a vault. Each share represents a beneficial interest in a unit quantity.

For example, each share in the ASX-traded stock ‘GOLD’ entitles the shareholder to a beneficial interest in approximately 1/10th of a troy ounce of gold, and the share price trades at the current Australian dollar value of that amount (AUD$115.70 at the time of writing).

For an investor, the only immediate expenses are brokerage and the buy-sell spread. There are internal administration expenses such as gold storage fees and these are reflected in the share price.

More information can be found here:

http://www.goldbullion.com.au/

http://www.exchangetradedgold.com/

Online Digital Gold Certificates 

These are a form of electronic money that is based on unit amounts of gold. These are issued by private companies that operate websites, the most famous being E-Gold. Think of it like Paypal, except your account balance is measured in ounces or grams of gold.

You can top-up your account by purchasing gold at the current market price in a supported currency, and you can redeem gold at the current market price. You can send and receive any gold, to and from other parties. Each time you carry out a transaction, you are typically charged a commission, based on a fixed quantity or a sliding percentage scale.

Online digital gold currencies have generated controversy due to their abuse by fraudsters and money-launderers. Questions have also been raised about the proportion of clients’ funds that are actually held in gold bullion, but I am not aware of any cases in which the digital gold providers did not meet their financial obligations to clients.

More information can be found here:

http://en.wikipedia.org/wiki/Digital_gold_currency

Stock Valuations and Kevin Rudd’s $1M Bank Deposit Guarantee

Hello Everyone,

Pardon the sparseness of my posts in the last fortnight. I have been reading and thinking very hard. For me, it is important to try and say something meaningful rather than contribute to the endless media waffle concerning the current financial crisis that does nothing more than waste time and confuse people further.

As first glance, many ASX stocks look incredibly cheap based on historic valuations. There are now heaps of shares that have P/E ratios less than 10, and offer fully-franked dividend yields greater than 10%. These are not just the battered property trusts who have high debt – many of these companies are in other sectors and are still reporting record earnings growth. So why aren’t these companies’ share prices going up?

The reason is that sentiment is very very poor. The market is anticipating future drops in earnings over the next few years as the financial crisis runs its course. People lack accurate, trustworthy information, so they are expecting the worst.

I personally see reasons to be positive. Emerging markets like Brazil, China and India are still growing strongly, and many Australian companies have exposure to these economies. There will still be demand for cheap consumer goods. Plenty of money will still be made in biotechnology and agriculture.

My share portfolio has been battered heavily – I have many small cap stocks which naturally are more volatile and lack liquidity, but they’ve all been paying their dividends like clockwork and most of these dividends are higher than last year. I do not buy shares that do not pay a good dividend – I see the dividend as a mark of business stability and compensation for periods of stagnation.

Right now, I expect the market to see-saw up and down for a prolonged period. I am looking at ways to take advantage of this. One area I am reading up on is the investment technique known as Value Averaging. Most people are familiar with Dollar Cost Averaging, in which one regularly invests a fixed amount of money into a share or managed fund, regardless of the price. 

With Value Averaging you vary the contributed amount depending on the value of your portfolio at the end of each time period, in order to reach a pre-defined target. The end effect is to buy more shares when prices are lower and buy fewer shares when prices are higher. Research has shown Value Averaging to outperform Dollat Cost Averaging about 95% of the time. I plan to write a post on this in the near future. If you can’t wait, click on the above link.

In other news, on the 12th of October, Prime Minister Kevin Rudd surprised everyone by announcing a package to provide an unlimited  guarantee on bank deposits. The financial markets reacted like an agitated grizzly bear hit with a tranquiliser dart – there was a day of temporary euphoria, followed by a swift return to instinctive behaviour.

A week later, Kevin realised that the package may have been overly generous and he announced that the bank deposit guarantee would be limited to $1 million. Beyond this amount, bank account holders would have to pay for insurance.

I question the wisdom of this scheme. Although this may have allayed consumer fears about the solvency of banks, it may have had the unintended side effect of further fuelling an exodus from shares and other asset classes into this newly created ‘perfect safe haven’.

Furthermore, in the event that the financial crisis worsens and a bank does become insolvent, where is the Government going to get the money to meet their guarantee obligations? Probably by printing more money! This will cause increased inflation and devalue everyones’ wealth. Nonetheless, this is probably far more emotionally palatable than going to your bank and being told that your money is gone.

Speaking of inflation, the Australian Bureau of Statistics stated that the Consumer Price Index (CPI) will reach a 13-year high of 5% this year. The current interest rate on Australian bank deposits is around 6%-6.5% per annum, so people who have their money in cash will be treading water.

In contrast, corporate earnings are more resistant to inflation. Assuming that demand remains constant, corporate revenue rises with inflation. For this reason, I see better value in making defensive investments in defensive low-debt stocks than blindly putting money in the bank, unless you need to access your money in the short-term.

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