Financial Options After One Has Declared Bankruptcy

Bankruptcy is a financial option for those individuals whose debt has run away from them. It is not that hard to experience debt issues and individuals have had to declare bankruptcy in order to dig themselves out of the surmounting debt. The term bankruptcy has negative connotations however this should not be the case. An individual who declares bankruptcy is taking that big step in order to get their finances under control and wipe the slate clean. Individuals may be hesitant to do so as they feel their life post-bankruptcy will be financially constrained. This is not so and the following paragraphs will highlight some financial options one has following the declaration of bankruptcy.

Mortgage after Bankruptcy

One issue that disturbs individuals considering filing for bankruptcy is that they may never be able to obtain a mortgage after bankruptcy declaration. The fact is that individuals who have declared bankruptcy have been able to obtain a mortgage after that proceeding has been completed. Most individuals looking to obtain a mortgage post-bankruptcy will have to wait until the bankruptcy is final and proceedings have been completed yet there are lenders who are more than willing to lend to an individual post-bankruptcy. Bankruptcy mortgage financing is available to many individuals who are in that predicament. Some lenders may deny loans to these individuals yet there will always be other ones who will finance home loans after a bankruptcy declaration.

Credit Cards after Bankruptcy

Another issue which individuals find themselves contemplating both prior to and after declaring bankruptcy is whether or not they will be able to obtain credit cards after bankruptcy. Credit cards are extremely important items for many individuals as they provide a way for people to make large or vital purchases and then pay back the debt on a monthly basis. It is important to note that credit card companies will and do provide credit cards to individuals who have declared bankruptcy. Although some credit card companies will be more selective than others, it is necessary to point out that there are options with regard to obtaining credit after bankruptcy.

Personal Loans after Bankruptcy

Individuals who have declared bankruptcy may also be able to obtain personal loans. Personal loans are used for a variety of reasons such as college, home improvements, or purchasing a car. A personal loan after bankruptcy is not a rare occurrence and a variety of lenders will make this option available to borrowers who may have fallen on hard times in the past


There are certain instances in individual’s lives when they need to declare bankruptcy. It is crucial for these individuals to keep in the back of their mind that declaring bankruptcy will not definitively thwart any future loans which they need to acquire in the future. One who seeks bankruptcy advice should also inquire about credit repair after bankruptcy and what the future may hold for individuals like themselves who need to declare bankruptcy.

Economic Data And Its Influence On The Financial Markets

The things which contribute to price levels and action in the financial markets are numerous and diverse, and their influences can vary through time, and across different markets. This article identifies the different types of Economic Data influences and the role they play.

There are two ways economic information can influence prices. The first is in the macro sense. Macroeconomic inputs include:

Interest Rates
Economic Growth (GDP)
Government Budget Surpluses/Deficits
Trade Balances
Commodity Prices
Relative Currency Exchanges Rates
Corporate Earnings (both for individual companies and the broad collection)

These elements will generally all have long-term inputs in to the pricing of any given market. They do not tend to move in sharp, dramatic fashion, so their influences also tend to be seen over longer periods of time.

That said, the release of economic data related to the above can be seen to have serious impact in the short-term activity in the markets. This comes primarily in the form of data releases. Some of the most important are:

Employment Data
Trade Data
GDP growth figures
Consumer & Producer Inflation rates
Retail and Wholesale Sales
Confidence & Sentiment Readings (U. Michigan survey, etc.)
Income & Spending
Interest Rate policy decisions
Earnings releases

The markets can react in very, very dramatic fashion to these releases when they are out of line with expectations. The foreign exchange market, namely the EUR/USD exchange rate, provides a striking example.

On one Friday morning at 8:30 Eastern the monthly Non-Farm Payrolls report hit the wires. This report (released on the first Friday of each month) probably provides the most short-term volatility across all market sectors of any regular economic release. When the data comes in well off of market expectations, fireworks can ensue, as was the case in the example. Over the course of about 2-3 minutes EUR/USD fell more than 20 pips, turned around and rose about 60 pips, then fell back down to near where it had been before the data was announced (a pip being 1/10,000 of a Dollar). It then proceeded to run nearly 100 pips higher in fairly steady fashion over the course of the next hour.

Here is another example, this time of T-Bond futures.

When those payroll figures were released at 8:30 the market dropped more than two full points. One point on the T-Bond futures contract is worth $1000, so each contract fell more than $2000 in about two minutes. Consider that the margin on a contract at the time was probably around $2500. That means a trader could have lost more than 80% on the trade in the blink of an eye.

It is also important to understand that in the futures pits such data events often result in fast market conditions. This means that the action is so hectic that there may literally be trading going on at several different prices in different parts of the pit. This is a risk of having open positions at the time of a major news release. The market may snap back fairly quickly, as in the chart above, but in the meantime the trader’s positions may have been liquidated on a stop order at a substantial loss.

Fortunately, all major economic releases are well documented. They are done on a pre-announced calendar which is readily available on any number of web sites, and of course in the business news media. In the vast majority of cases, one can also find out ahead of time from any number of sources what the expectations are for the release.

Foreknowledge of pending data events may not prevent losses which may result from unexpected figures. It will, however, allow the trader to recognize and understand when risks are increased. Make sure, especially if you are a short-term trader, to know what data is coming out. It can make a difference in your performance.

Encrypted Email — Users Unknowingly Put Banking Data at Risk

PGP is one of the most common methods of protecting financial data that customers submit through banking and financial websites. PGP provides excellent data encryption, but many users leave sensitive PGP-encrypted data vulnerable without even knowing they’re doing so.

Banks, credit unions and other financial institutions use PGP to encrypt sensitive data, such as a loan application, before sending it through email. PGP makes the data is nearly impossible for anyone other than the intended recipient to decrypt. Unfortunately, after receiving the data the recipient often unknowingly creates an opportunity for thieves to steal the data.

Recipients decrypt PGP protected email messages to read the sensitive contents. Security-savvy users know to that after reading the message they need to either permanently delete the encrypted message or to save it in its original encrypted state. But a large number of users in financial institutions that we’ve worked with don’t do either. Instead they save the decrypted version of the email where thieves can easily access the information. In fact, Microsoft Outlook prompts users to save encrypted messages in a decrypted form whenever they close a decrypted message. Since neither Outlook nor PGP warns users about the danger of saving the message, most users click “Yes” and save the decrypted message.

When decrypted, the data is vulnerable to attack by viruses, malware and computer hackers. Some executives dismiss the threat by touting the protection that their firewalls and intrusion prevention systems provide. Firewalls are almost useless when PCs are infected with data harvesting viruses or malware, so relying on firewalls to protect data stored on PCs is akin to putting a lock on a screen door.

Even when firewalls do manage to keep PCs free of any viruses or malware, what happens when the bad guy is someone inside the organization?

According to the FBI, insiders – employees, contractors and business partners – commit nearly 70% of all data theft crimes. They steal data directly from the corporate network or they steal the computers & hardware that store the data. Sometimes they even “buy” the data by purchasing decommissioned computers that organizations sell to employees. A firewall will do nothing to protect decrypted data stored on the PCs that these attackers gain legitimate access to.

We’ve implemented a safer way to protect data submitted through websites. Using MemberProtect, our clients have eliminated the decrypted data theft risk. MemberProtect does not rely on email delivery and instead stores data inside a uniquely-encrypted database. Administrators control who can access the secure web-based viewer to see the data submitted through their websites. MemberProtect decrypts the data to allow viewing, but unlike Outlook, MemberProtect always re-encrypts the data when the user is done viewing it.

MemberProtect also creates an audit trail that auditors and security administrators can use to see who has viewed, modified and deleted data. It also tracks logons, attempted logons and user interactions with the protected system. MemberProtect stores this audit login a separate encrypted database to prevent log tampering by system administrators or other insiders. When integrated with intrusion detection systems, the system can perform a degree of self protection by severing connections with suspicious clients and immediately notifying administrators of suspected hack attempts.

If your budget cannot support a system like MemberProtect (approximately $3,000 to $5,000 for implementation on a bank website), then PGP is still an acceptable security option, but it’s critical that you train all users to:

Never save decrypted messages
Never share their PGP pass phrase
Always make a backup of their private key since if this key is lost, the messages cannot be decrypted

Exchange Rates – Keeping an Eye on Them

Keeping an eye on currency exchange rates is essential when traveling if staying within a budget or if just not wasting money is of concern to you at all. What does exchange rate mean? Typically, using the US dollar as a guide, other currencies would be worth more or less than a dollar for exchange of value. For instance, a Canadian dollar might be worth 85 percent of an American dollar, or 85 cents. Then when comparing a US dollar to the British pound, it a pound might be worth two US dollars. The fluctuating exchange rate means that, depending on market conditions, one day a pound might be worth two dollars, and the next day a pound might be worth two and a half dollars, and the next day worth one dollar and ninety cents.

A currency will be either free floating or pegged. A pegged currency is fixed by the government relative to the value of another currency. For example, the Hong Kong dollar in the 1980’s was fixed or pegged relative to the US dollar and always worth a set percentage of the currency it was pegged to. A free floating currency is allowed to fluctuate in value relative to all the other currencies on the foreign exchange market. When discussing currency people also refer to the nominal exchange rate, and the real exchange rate. The nominal rate is the rate at which a currency of one country can be traded for the currency of another. The real rate is the rate at which goods and services of one country can be traded for the goods and services of another. If, for example, the price of a product increases by ten percent in the US and there is a ten percent appreciation in the Canadian economy against US currency, the price of the product would remain constant for Canadians despite the US price increase. This is of course assuming that no tariffs are involved.

As a practical matter exchange rates will change from country to country and can be used to make travel and tourism more attractive in certain countries at certain times, so if there are several countries you’d like t visit and you have a flexible schedule, keep an eye on the exchange rates. If a person is a visitor in New York City it is easy to see how people in other countries follow this rule. At certain times the city of New York will be flooded with visitors from Germany, France, the UK, or Japan. The reason for this is quite simple. When the exchange rate favors the Japanese or the Europeans, then visiting America becomes much cheaper for them than at other times. If for instance, one thousand Euros, due to a favorable exchange rate, will purchase twelve hundred Euros in value, then they have a net twenty percent gain and a twenty percent cash incentive to visit the US. In recent years this exchange rate has usually worked in favor of Europeans, but in years past it worked in favor of Americans. For instance, before the Euro became the standard currency of Europe, Italy used lira, Germany the deutsche mark, Switzerland the Swiss franc, Austria the schilling, and France the French franc. In the early 1980’s the exchange rate was five French francs to the dollar, two and a half Swiss francs to the dollar, one thousand lira to the dollar, and two and a half schillings to the dollar on average. The German mark was fluctuating, anywhere from 1.7 marks to the dollar to 2.5 marks to the dollar, so when the dollar was worth 2.5 marks Americans would be ahead to trade in their dollars for marks. When the rate was 1.7 they were better off not spending German marks.

Keeping an eye on exchange rates will always benefit the traveler. Even if you are just crossing the border to visit our neighbors to the North in Canada or the South in Mexico, knowing what the normal value of the other nation’s currency is, and planning your trip for when the fluctuation is in your favor will increase spending power.

First Of All, Know Thyself

One of the most important elements of success in trading (and life in general) is knowing yourself. If you do not understand how you tick, you will never be truly prepared for the demands of trading, and likely your performance will suffer as a result.

Let me use myself as an example.

I am what might be considered project oriented. By that I mean I like to move from one thing to the next – always have something upon which to focus my attention. As my friends and colleagues can attest, once I complete a project – and sometimes even before I do – my thoughts shift to the next one. I actually get antsy if I have nothing lined-up. Predictably, this is reflected in my trading.

We can actually think of trading as a series of projects. Each position one takes on is a new project which incorporates analysis of some sort (automated or otherwise) and trade decision-making. When a position is closed out, it is like wrapping up a project. It’s over and done – time to move on to the next thing.

There’s a little problem with that, though. This kind of “project” approach, in the case of someone like me, can lead to overtrading. This isn’t the kind of overtrading which is referred to when one speaks of taking on positions which are too large, though. Rather, I am speaking of trading too frequently. In my case, when I close a trade I find myself immediately eager to open a new one. It doesn’t matter whether I made or lost money on that first trade. Because of my “need” to have a project going, my psychological pull is toward finding a new trade to make. (Note: I do not consider this in my case to be like the “fix” trading provides as an intermittent feedback mechanism, like gambling.)

This little personality trait of mine is something I figured out a while back when I realized that I am most comfortable when I have an active position in the market.. It doesn’t matter how large or small that trade is as long as I can check on it periodically and feel like I’m involved. Knowing this, I take two approaches to avoid the overtrading problem.

The first thing I do is trade longer-term. By doing so, I give myself the opportunity to take on long “projects”. I often have trades with durations of weeks or even months. These aren’t all my trades, mind you. I do trade short-term at times, but my schedule is such that longer-term position trading tends to fit best most of the year.

When trading shorter-term, I use a second approach to combat the “project” itch. Specifically, I try to step away from the market for a while following the completion of a trade. It lets me clear out the emotional residue of finishing a project and come back at it fresh. That can quite often make the difference between taking impulsive trades and being properly selective based on my analytic methods.

Of course, this is just one example of the sort of psychological hurdles which come up in trading. We all have patterns of behavior which are based in our personal lives that can quite easily carry in to trading, positively or negatively. Brett Steenbarger’s outstanding book The Psychology of Trading provides an excellent discussion of how this can happen, and ways we can overcome the problematic ones. The primary point is that we need to be able to look at ourselves like an outside observer. In that way we can get to know ourselves, and that’s at least half the battle.

Five Budget Tips to Help You Save

Saving money is much easier than earning it from scratch. But it is also much harder than it is to spend money, and as a result, most of us spend what we would rather save. In order to begin saving money, we need to have a plan, and the more automatic the plan works, the better. When we are confronted with the choice between spending money and saving it, we run the risk that we will give in to the temptation to choose instant gratification. So taking the choice out of the equation is one of the first steps to a steady savings program.

Here are five tips for budgeting and saving money, the automatic way:

1) Set up an automatic withdrawal program with your bank, so that every time you make a deposit, a percentage of the money you deposit is automatically transferred to a savings account that is harder for you to access. One way to do this is to have your bank use an automatic deposit system to put a set amount of money – for example, $100 – into your savings account each month.

2) Save your loose change and small bills. Put a piggybank in your kitchen and every time you come home, empty the change from your pockets and put it in the piggybank. Toss in a few one-dollar donations from time to time. Although it sounds juvenile, you will be surprised how much you can save with this old fashioned method. And it is so much fun to break the bank when it won’t hold another cent.

3) Write down everything – and that means no exceptions – you buy. Keep a log of every single purchase you make. Write down what you bought and how much it cost. If you left a tip, write that down too. Be diligent about keeping your log book, and if you do it well, you can just do it for a month and gather enough information to help you save even without the log book. Most people find hidden expenses, like $10 per day for coffee or $50 per month for a gym membership that is never used, and then they can easily adjust their budget to save money immediately.

4) Spend less at holidays. And entertain at home. Instead of giving expensive gifts at Christmas, give handcrafted items, poems, or pledges to do errands or barter with friends. One fellow we know agreed to shovel his friends’ sidewalks during one snow season. His friends got a great gift, and he saved some cash to spend once the snow and ice thawed. Instead of going out to eat in restaurants, cook at home or invite friends for a potluck dinner. Rent DVD’s instead of going to the movies.

5) Don’t shop hungry. Scientific studies show that people who have a strong appetite will not only eat more, but they will consume more of everything else, too. Many of us know that if we go grocery shopping while hungry, we will buy more than we need. So don’t do it. Eat first, then shop. But since studies show that it applies to all sorts of shopping, always have a satisfying snack before going to the mall, the clothing boutique, or the sports store. You’ll spend less, and save more.