| Watch that credit score! It could end up costing a lot
Not paying attention to your credit score can cost you a lot of money. Many people don't know that their score -- a three-digit number derived from an analysis of how they handle debt -- is the key determinant of what interest rate they'll pay on credit cards, auto loans and home mortgages. The lower a person's score is, the higher the interest rate and, therefore, the higher the cost for the loan. A new study by the Consumer Federation of America and Washington Mutual Inc., the Seattle-based savings bank, found that fewer than six out of 10 Americans have obtained their credit scores, and half of those surveyed consider their understanding of the scores as "fair" or "poor." Stephen Brobeck, executive director of the nonprofit CFA, which is based in Washington, D.C., said he found the statistics disturbing because consumers can't work to improve their scores if they don't know what the scores are.
Transcript: Bank of England Inflation Report Press Conference
Mervyn King, Bank of England governor, Charlie Bean, chief economist and Paul Tucker, executive director for markets, answered journalists' questions in the Bank at the launch of its quarterly Inflation Report on August 8, 2007. This is an FT unabridged transcript edited for clarity. Mervyn King's opening statement: .
"Dollarization" buys optimism, little else
U.S. dollars can buy anything and everything in the sprawling Central Market here: steaming tortillas, live ducks, bootleg liquor, love potions — even a hit man if you know whom to ask. This Central American nation adopted the greenback as its official currency in 2001, thinking the move would spur economic growth. But the ubiquitous "$" sign on shoe racks and vegetable bins hasn't been the magic elixir many had hoped. And it's been a particular disappointment among low-income shoppers and vendors. Potato peddler Jessica Janette said she used to sell 100 pounds of spuds daily from the pile in her stall. Now she's lucky to move that much a week. The switch from El Salvador's former currency, the colon, to the dollar drove up prices of many staples as producers and merchants rounded up to the nearest nickel, dime or quarter.
How do I grab some of this ‘excess’ liquidity?
Whenever I hear the words ‘excess liquidity', I begin to worry. It usually means that I somehow end up having to pay more interest on my loans, or getting less interest for my deposits — because the economy and the banking system have trouble dealing with all that extra cash sloshing around in the system. That is apparently why the Reserve Bank of India stepped in a couple of days ago and hiked the amount of cash banks will have to keep locked up with it. The banking regulator doesn't want too many rupees being injected into the economy at this point of time, which will have the potential of pushing the inflation rate up. Good on them, I say. As a consumer, I am all for moderate inflation rates. Especially since the private sector has long buried the concept of an inflation index-linked ‘dearness allowance', which was supposed to automatically prevent your real disposable income from eroding.
Venezuela boss bites U.S. hand that feeds him, spreads oil wealth for power for the poor, himself
Second in a series on embattled Venezuela by Lowell Blankfort, prize-winning Post columnist and former co-owner, and his wife April, who have returned from almost three weeks in that country so important to American oil supplies and, increasingly, the future of Latin America. For most of Iran's 70 million people, life is a bummer. But they have one consolation, they will tell you. While in an oil-short world, most other people are paying through the nose to fuel their cars. Iran is loaded with the stuff and Iranians never need worry where their next gallon of gas is coming from nor overpay for it. Well, earlier this month Iranians had a shock. Their government started rationing gasoline. Iranians rioted against their loudmouth president who defended gas rationing as part of an Iranian "economic revolution." Angry drivers set fire to more than a dozen gas tanks.
More rate rises predicted
THE Reserve Bank of Australia is likely to lift interest rates again early next year as inflation levels are expected to rise, economists say. Commonwealth Bank of Australia chief economist Michael Blythe said today the RBA was likely to lift interest rates from their present 6.5 per cent after the election, which is expected towards the end of 2007. Responding to the Reserve Bank's quarterly monetary policy statement, released this morning, Mr Blythe said the statement included "some fairly tough words on inflation (with) some big upward revisions higher than what most people were expecting". "Clearly, despite the volatility on financial markets, the risk of interest rates are still skewered to the high side," Mr Blythe said. The RBA's statement said underlying inflation was already running at an annual rate of about 2.75 per cent, near the top of its target range of 2 to 3 per cent.
Turmoil in the credit markets
Credit markets are in turmoil. Christian Stracke, analyst with CreditSights, answers your questions on what it all means. ............................................................................................................................................ What will be the financial and economic effects on the various emerging market regions, and please identify the critical factors to evaluate. M J DeLeon Christian Stracke: The major emerging markets economies have been swept up in the same global liquidity glut that helped to pump up the subprime sector, Spanish real estate, commodities, etc. Fortunately, most EM governments have been avoiding a lot of borrowing from foreign investors (with a few important exceptions, of course), so we don't have to worry as much about a classic debt crisis the way investors had to deal with the debt crisis of the 1980s, the Tequila crisis in 1994-95, the Russia crisis of 1998, and most recently the Argentina default.
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