Clark said in the aftermath of Katrina that President Bush should issue an apology, and he was met with a lot of protests over the comment. People approached him to say that Bush had nothing to apologize for because it wasn’t his fault the disaster occurred. Well, Bush has apologized since, according to news reports. In Clark’s opinion, it could have come a bit sooner. The power of apology is huge these days, especially if it happens early on. The same is true with companies. If a company makes a mistake, the response has been to deny and defend. But several companies are changing that policy and are coming clean with mistakes they make. The great part is that it’s benefiting them rather than hurting business. Toro, the tractor and mower company, has changed its policy and now announces when it has done something wrong. It’s severely cut the legal bills of the company. Several hospitals have also started telling patients when doctors make mistakes, even if the patient has no idea. It’s cut down on the number of malpractice suits at those hospitals.
Clark was in a warehouse club the other day when he passed by the wine aisle and saw numerous bottles of wine for $4.99 a bottle. Clark doesn’t know anything about wine and he doesn’t really like it, but he was excited. According to a Gallup Poll, people are now drinking more wine than beer. There is such a surplus of grapes that you can get tons of great bottles for under $10 a bottle. Richard Branson, the mogul of Virgin Airlines and Music, now offers wines, too called “Virgin Vines Wines.” They are designed to be extra hip and to appeal to drinkers in their 20s and 30s. They have twist off caps so they’re much easier to open and drink. Don’t turn your nose up. You could discover that a $4 bottle of wine is just for you.
Clark’s next book, Clark Smart Real Estate, is slated to come out next year, and the section on financing has grown by leaps and bounds. That’s because financing a house is such a difficult and risky task these days. The Department of Housing and Urban Development proposed regulations that would require mortgage companies to tell you the truth about every fee and charge on your bill. But banking lobbyists worked the halls of Congress and got them to turn HUD away. You need to cut through the clutter when you’re getting a mortgage because companies will try to rip you off. That is especially true for black borrowers. Recent investigations show that lenders rip off black homebuyers more often and other groups. It’s disgraceful and wrong. If you are black, you need to know about this and be prepared. Lenders are telling you that your credit is not sufficient enough to get a loan and you have to take on a high-risk loan with higher rates. So, before you buy a home get copies of all three of your credit reports and your credit score, so you are prepared. You can do that for free now at annualcreditreport.com.
Have you done an inventory recently on how much money you have in your savings & checking accounts and in your brokerage accounts? A few months ago Clark talked about brokerage houses that were defaulting accounts into extra low percentage accounts. Over time, it eats you up. The average bank or credit union isn’t paying a great rate either. But if you shop the market place you can do great. Federally insured money market accounts are earning 3.75 to 3.8 percent. And one-year CD are earning 4.5 percent. Compared to recent years, that’s great. If you go for a 2.5 year CD, you’ll earn the same thing. There is no benefit to doing a long-term CD right now. The sweet spot in the market place is 1-year CDS and money market accounts. These are parking spots for savings. This isn’t investing. You can go shop rates online at bankrate.com. That’s why you don’t let your idle cash sit in a local bank with puny fees. With your brokerage statement, call up and ask for other alternatives “for sweep.” You want the money swept into a high interest rate account. If they tell you they can’t move you or you don’t qualify, can them. You work hard to make money. Make it work as hard for you as possible. Your assignment is to look at your most recent statements and see what they’re paying you.
There is a shining light in the aftermath of Hurricane Katrina and that is the city of Houston. The city has not received nearly enough praise for picking up the pieces of the tragedy on the Gulf Coast. Houston now has 200,000 new residents, and only three percent of them live in shelters. About 97 percent of people are staying in people’s homes, in hotel rooms or have their own apartments. Only three percent are in shelters. It’s due in part to two people, who’ve been working non-stop since the Katrina hit. Bill White, the mayor of Houston, and Robert Eckles, the top judge in the city meet every morning with various city officials. If some bureaucratic roadblock has come up the day before, they fix it that day. The mayor has basically taken over the federal, state and local effort on behalf of these folks and he’s inspired the people of Houston. It’s shown us what leadership and accountability can do in a crisis, and we need more people like these men governing us. Whatever they’ve been able to pull off in Houston, the Federal Government needs to follow suit.
Clark loves competition and hates monopolies. Monopolies stifle capitalism and harm our country. That’s why Clark was so excited when satellite TV started in 1994. It was the first competition for monopoly cable companies, and satellite has been growing ever since. The best scenario is when there are three competitors in an industry. It prevents any of the three from slacking off and keeps all of them on their toes. The good news is that Verizon is going to be that third factor. Verizon is operating pay TV services in Texas, and it’s going to cost one-third of what cable costs, according to Newsday. So, if you were paying $60 a month for cable, you’ll now pay about $40 for Verizon service. There will probably be some fits and starts with it, but Clark is so happy about a third player coming into the market. Consumers will benefit a great deal from this.
Gas prices in the U.S. continue to drop. We’re now down to about $1.85 a gallon at wholesale and dropping down into the $2 range at the gas pump. Industry analysts predict prices will drop even further. But, we really don’t have a lot to complain about when you consider what people are paying for gas in other countries. Gasoline in London is $7 a gallon. In Germany and France, it’s the same, and in Japan it’s about $4.35. We have long enjoyed the cheapest gas prices in the world and the outlook is good for the future. So, think about the big picture before you allow yourself to get upset at the pumps. You can also control how much gas you use by altering your travel patterns and, when the time is right, buying a more economical car.
