Sallie Mae, What A Tramp…

Me Top Dog.  You... not.

Whilst Fannie Mae (FNMA) and Freddie Mac (FMCC) are languishing in  penny-stock purgatory, SLM Corporation (Nasdaq: SLM), or Sallie Mae as it's commonly known, is doing just fine, thank you very much. A former government-sponsored enterprise (GSE), SLM Corporation enjoys tidy profits of over 12% on yearly revenue of around $6 billion, reasonable returns on equity,  and a nice little 2.97% yield (for you dividend hounds). On the face of it, SLM appears to be a decent good place to invest  (more on that later, things are not what they seem). Sallie Mae, Flying Low Under The Radar Chances are most people have only heard of Sallie Mae in the context of Freddie Mac, Farmer Mac,  and Ginnie Mae, fuzzycute monikers for grossly inefficient … [Read more...]

You Say Debt Consolidation, I Say Individual Voluntary Arrangement

"Les compteurs d'argent" (ca 1575-1600)  - The Silver Buyers, Anonymous --- Museum of Fine Arts, Nancy, France

For individuals, it's debt consolidation, debt recovery, or credit repair. For large corporations and banks,  it's a slightly more benign debt restructuring.  Sounds like a home remodel. Governments playing fast and loose with other people's money instead get to call it a rescue package. It don't hardly seem fair... Each class of debt has its own peculiar lingo:   sovereign default, austerity measures, subordinated debentures, rescue packages, haircuts and bond vigilantes. In the Greek and Spanish debt crises, there are no villains, just perpetual victims.  And central banks riding in on white chargers, bearing sacks of a couple hundred billion euros. Let a large corporation get in debt trouble, and its bankers get … [Read more...]

The Amazing Profits of Payday Loan Companies (?)


Common sense would suggest that a lender charging interest rates of three to four hundred percent a year would soon amass the kind of fortune that Scrooge McDuck himself would envy. The way these companies are reviled in the commentariat of the mainstream media, we'd also expect the people who run these companies to be all top hat, cigar, red satin lined cape and twirling mustaches. After a hectic day of evicting widows and orphans from seedy tenement apartments,  these dastardly Snidely Whiplash characters might cap off the day by driving up to their storefronts in limousines to collect bags and bags of money (with the comical and obligatory big $ sign). Truth is, cash advance and payday loans are a business like any other, more … [Read more...]

Payday Loans Are for Emergencies

This post was provided by Sophie Wright from A payday loan should be used for emergencies only, not for boozing it up on the weekend or getting the cutest outfit ever or that trip to Ibiza. It is a stopgap financial measure to hold you over until the next paycheck. A legitimate expense might be a vehicle breakdown or a medical emergency, or both. The advantages of that you can get from fast cash loans is exactly that, that they're fast. As long as you're gainfully employed and can demonstrate it, the online approval process can be speedy and hassle-free. Some companies may even waive the credit check, as long as valid pay stubs are presented. The bad perception on payday loans, and one for which they have been … [Read more...]

Caffe’ Ristretto: A Brief Look At Debtor’s Prison


Note:  I started this coffee break series to tide readers over between longer blog posts. I'm having to travel more recently, and rather than leave the blog populated by guest posts (of which I'm getting a rash of offers in the mail, mostly from bingo parlors in Hong Kong) or worse yet, content-less.  Caffe' Ristretto (as explained by Wikipedia) just means a shot of espresso with less water, and less resulting coffee oils. The taste is supposed to be more nuanced. For me, I'm not that nuanced. It's just good coffee. Lucky for us we don't have debtors' prisons any longer. Or do we?  This from the Wall Street Journal: Welcome to Debtors' Prison, 2011 Edition Some lawmakers, judges and regulators are trying to rein in the … [Read more...]

Mole Traps and a Finance Lesson from the Garden

this is what (garden) evil looks like

I used to say that I hate moles. Hate with a passion. Hate with a liquid-white-hot intensity. Hate, hate, HATE! All the frustration and evil feelings stemmed from the fact that no method seemed effective at neutralizing the little bastards: repellent sonic spikes, castor bean extract, Liquid Fence, various types of organic liquid repellents, Juicy Fruit gum, and a couple of different types of spike and pincer traps. Nothing worked, and the moles rampaged up and down the lawn and garden, killing off plant unlucky enough to have grubs in their root zone. I tried poison pellets, but I think moles are smart enough to know the difference between a chemical pellet and the real grubs. I've tried predatory nematodes, who are supposed to … [Read more...]

ForeclosureGate Roundup

    This latest real estate foreclosure mess seems to be getting uglier and uglier. A smattering of news and posts on the subject: An article by Charles Hugh Smith on AOL Daily Finance:   The Foreclosure Crisis: Eroding Trust -- and Ending the Recovery? Huffington Post writes on how untrained folks were hired to process foreclosures in Banks' Foreclosure "Robo-Signers" Were Hair Stylists, Teens, Walmart Workers: Lawsuit Gonzalo Lira's blog has a very succinct take on the whole mess, in The Second Leg Down of America's Death Spiral.   Happy title, yes?  (Warning: strong language) From  Legal Heat On Robo-Signing Stokes Foreclosure Fiasco "..... Attorneys General from all 50 states have … [Read more...]

Debt Advice from the Federal Government

(  This is straight from inside a Kafka novel, almost can't make this up.... ) Personal Finance Advice from the Federal Trade Commission, Consumer Protection Battalion (they might be  a division, but I just downgraded them). Before You File for Personal Bankruptcy: Information About Credit Counseling and Debtor Education Produced in cooperation with the Department of Justice’s U.S. Trustee Program The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 launched a new era: With limited exceptions, people who plan to file for bankruptcy protection must get credit counseling from a government-approved organization within 180 days before they file. They also must complete a debtor education course to have their debts … [Read more...]