Teaching Money Skills for Life

Fall series kicks off August 30

Future Cents in an interactive series of workshops that will help give teens a reality check about money management. How many of us as parents see them repeating our mistakes with money. Give them the tools that they need to succeed and not fall into traps. Take advantage of the free workshops that teach young people to live beyond today and investing in their future. For more: http://www.myfuturecents.com. See details about programs, information about the iPad drawing and resources.

The kick off event is Monday evening, August 30 and will present banking topics and Keys to Money Mastery.  Algenon Cash wears many hats in this community. As owner and managing director of Wharton Gladden & Company, writer, radio personality, and community enthusiast, Mr. Cash has his hands on many projects.  Currently, he is integrally involved with Future Cents, the Greensboro Public Library’s financial education project for teens.  “I firmly believe that financial literacy is the civil rights issue of the 21st century. Americans do not understand basic skills such as how to balance a checkbook. Programs such as Future Cents are creating a discussion about a critical issue facing our youth,” says Cash.

Fall series kicks off August 30.

Raising Money Smart Kids

How well adjusted are our children when it comes to money?  Statistics show that young people are buying more and accumulating more debt than ever before.  Future Cents is a grant funded project that will help youth and their parents learn budgeting, checking, saving, investing and more.  The goal of Future Cents is to help youngsters develop good money skills.  Too often older teens get a first  job or obtain student loans for college and they have little knowledge of managing their money as they become adults.

The website myfuturecents.com provides details on programming and resources to help teens and adults learn more about financial responsibility.  The programming begins June 12 with 2 sessions: Credit 101 for teens and Understanding Your Credit Report for Adults.  As Future Cents develops we hope to build a program that is attractive to teens and provides them with the skills to become independent and responsible adults.  This project will run through December 2011 so you will see more as resources and programs are added. 

Community involvement is key for the success of this program.  I am pleased to announce that the Black Achievers group at the Hayes-Taylor YMCA will work hard this summer to learn the skills that the Future Cents curriculum offers and go out to mentor younger kids in learning good money habits.  This is just one way that the community is coming together to make Future Cents a success for young people.

The First Anniversary of the Lehman Collapse Approaches; Will the Financial System Be Reformed?

So, an anniversary approaches and what have we done?  Will it simply be business as usual for a financial system that just a few months back was on life support?  Or, will there be meaningful reform which can give Americans confidence that this won’t happen again?

Check out this CNBC interview with Morgan Stanley CEO John Mack, who expresses concern that government officials have “lost a little of [their] steam [for] financial reform” and still don’t fully understand last September’s Lehman Brothers collapse.

And in this opinion piece, Michael Yoshikami worries that the financial system is still over-reliant upon self-control and that “fringe firms willing to take excessive risk and believing in their own infallibility” might once again plunge us into disaster.    

But, the Obama Administration is concerned about financial reform — though the health care debate is getting far more attention these days.  

During a Town Hall meeting the other night, for instance, Treasury Secretary Timothy Geithner acknowledged

[w]e have to have much stronger rules of the game in place with much stronger constraints on how much risk can take place.  People are so angry.  They have had this searing experience that caused so much damage and I think generally people understand that we’re going to have to change things. We can’t let things go back to the way they were.

Moreover, President Obama plans a major speech next Monday night to mark the Lehman anniversary and call for financial reforms to safeguard us against another similar catastrophe.

It’s probably going to be a hard sell though, and this article suggests banking and financial reform — which must be pushed through Congress — is already in big trouble.

Congress and the President must work out just how much and what kind of regulatory power the Federal government will be granted over financial institutions.  At the same time, both can expect plenty of pressure from the financial lobby, which fears overregulation — and whose influence, many would no doubt argue, had a lot to do with the Lehman disaster and the Financial Crisis of ’08.  

There are many proposals on the table, including a new Consumer Financial Protection Agency, increased powers for the Federal Reserve, controls on derivatives trading, and increased capital requirements in order to avoid the dangerous overleveraging of the recent past. 

One thing’s for sure:  we’re going to hear a lot more about the financial reform issue in the coming weeks and months.

If you’d like to read some very current literature about America’s financial woes, you can find lists of some of Greensboro Public Library’s recent acquisitions here, here, here, and here.

UPDATE:  Just as a pertinent follow-up, here’s an article from MSNBC/NY Times by Alex Berenson titled “A Year After Cataclysm, Little Change on Wall St.”

I Guess When “Doctor Doom” Says It’s Over, It’s Over . . . Opps, Wait a Minute!

Nouriel Roubini

Well, Nouriel Roubini, AKA “Doctor Doom,” one of the few economists to predict the financial crisis of 2007-09, really had folks on Wall Street going today when he seemed at last to be sounding a note of optimism. 

Earlier, CNBC reported Roubini had said we would begin to emerge from the recession by the end of this year and partly credited a late day stock market rally to his comments. 

But by the end of the day, CNBC was reporting Roubini had not really changed his forecast, and the latter issued the following statement:

It has been widely reported today that I have stated that the recession will be over ‘this year’ and that I have ‘improved’ my economic outlook.  Despite those reports . . . my views expressed today are no different than the views I have expressed previously.  If anything my views were taken out of context.    

Like many others, Roubini sees a very slow recovery and a continued drift upward in unemployment, as also does FED Chairman Ben Bernanke, who warned a few days ago of a “jobless recovery.”  And Roubini also thinks there remains a possibility of a double-dip recession.

Meanwhile, MSNBC’s John Schoen cautions that despite some impressive second quarter profits for Goldman Sachs, JP Morgan Chase, and others, the financial crisis is still far from over.  He quotes Stephen Roach, chairman at Morgan Stanley Asia, who thinks that “by the end of this crisis $4 trillion worth of bad assets will be written down.  Thus far financial institutions have written off, at most, half of that.  So there is plenty more to come.”     

If you’re still interested in the financial crisis and all its ramifications, Greensboro Public Library continues to pick up new titles.  A quick search of the catalog produced the following results, all published in 2009:  The Great Financial Crisis:  Causes and Consequences by John Bellamy Foster and Fred Magdoff; The Housing Boom and Bust by Thomas Sowell; Agenda for a New Economy:  From Phantom Wealth to Real Wealth by David C. Korten; A Failure of Capitalism:  The Crisis of ’08 and the Descent into Depression by Richard A. Posner; Dumb Money:  How Our Greatest Financial Minds Bankrupted the Nation by Daniel Gross; The Return of Depression Economics and the Crisis of 2008 by Paul Krugman; The Wall Street Journal Guide to the End of Wall Street as We Know It:  What You Need to Know About the Greatest Financial Crisis of Our Time — and How to Survive It by Dave Kansas; The Crash of 2008 and What It Means:  The New Paradigm for Financial Markets by George Soros; Financial Shock:  A 360° Look at the Subprime Mortgage Implosion, and How to Avoid the Next Financial Crisis by Mark Zandi; Panic:  The Story of Modern Financial Insanity, edited by Michael Lewis; And Then the Roof Caved In:  How Wall Street’s Greed and Stupidity Brought Capitalism to Its Knees by David Faber (on order); and The Gods That Failed:  How Blind Faith in Markets has Cost Us Our Future by Larry Elliott and Dan Atkinson.

Stewart vs. Cramer

The media was all abuzz Friday in the aftermath of the big square off between CNBC’s manic “Mad Money” Jim Cramer and Comedy Central’s Jon Stewart on “The Daily Show.”   By all accounts, Stewart held Cramer’s feet to the fire, lambasting the so-called financial expert for misleading investors.  Take a look at this article from Business Week; and here’s another good one from politico.com.

Clearly, the response is suggestive of just how successful Stewart was in channeling public frustration in the wake of the financial meltdown of the last few months.  Cramer himself appeared remarkably humbled (and guilty), as Stewart drove home the point time after time that the so-called financial guru was in bed with the very corporate interests which he was promoting on his show as sound investments — such as the likes of Wachovia and Bear Stearns, both of which have since gone bust.  And now millions of middle-class Americans (including many aging Baby Boomers) must come to grips with the fact that their retirement nest eggs are not what they once were.  As Stewart emphasized, for them “this is not a game”; their personal finances and their hopes for the future are teetering on the edge.        

If your curiosity about Jon Stewart is piqued in the wake of his takedown of the “Mad Money” man, you might want to check out his satirical America (the Book):  A Citizen’s Guide to Democracy Inaction.

We have a number of books by Cramer, including:  Confessions of a Street Addict; Jim Cramer’s Mad Money:  Watch TV, Get RichJim Cramer’s Real Money:  Sane Investing in an Insane World; and Jim Cramer’s Stay Mad for Life:  Get Rich, Stay Rich (Make Your Kids Even Richer).