“Morality, it could be argued, represents the way that people would like the world to work — whereas economics explains how it actually works.” This quote by Steven D. Levitt, from his book Freakonomics: A Rogue Economist Explores the Hidden Side of Everything, is a perfect explanation of how our economy is operating in today’s society. Whether one is a Republican or Democrat, morality is sure to come into question at some point when faced with any aspect of the economy. Democrats are primarily in favor of large government, along with taxes and spending that comes with this size of government. Republicans, on the other hand, abhor large government and would rather see lower taxes and less of an influence from the government with regards to spending. No matter how one looks at it, the nation’s wealth will always be controlled by a few, select individuals who have, whether through inheritance or intellect, raised themselves to a level above the typical citizen. Whether this wealth flows over the hands of a high-ranking politician or a Wall Street executive, it will still be influenced by certain individuals who have obtained a far superior quality of living as compared to that of an ordinary individual.

It is a little-known fact that a mere one percent of the global population owns ninety-five percent of the world’s wealth [3][4]. We hear about these powerful individuals everyday in the media, but we never stop to think about the wealth that could be accumulated when all of these individuals are placed together. How have these individuals reached this status? Many have earned their way to the top legitimately: whether through a unique idea, keen business expertise, or a combination of both. Others; however, have made their way to the top through less than moral deeds. Bill Gates, founder of the Microsoft Corporation, is just one example of a man who has legitimately earned his way to the top. Bernard Madoff, following in the footsteps of the Italian immigrant Carlo Ponzi, is one of many individuals who felt compelled to raise himself to the top at the expense of those less fortunate than he. The problem, it seems, lies in the ulterior motive behind these individuals who reach the top illegitimately — greed.

Roomy Khan seemed to be a typical Wall Street investor. She was an intelligent woman, and was able to use numerous resources thoroughly to turn her intelligence into decent returns. However, this deadly sin slowly started snaking its way into her life. Roomy Khan soon began receiving “inside information provided to [her] by co-conspirators who worked for publicly traded companies and investor relations companies who had access to confidential information on particular companies […]”. Using this information, Roomy Khan was able to execute copious amounts of trades which she knew without a doubt would yield her huge returns. In addition to utilizing this information for her own gains, Roomy Khan also “tipped several people at hedge funds with inside information on companies” so that these companies could share in the wealth that was now possible to accumulate [6]. What motivated Roomy Khan to transform herself from an honest investor to a fraudulent crook? It was, “an excessive desire to acquire or possess more than what one needs or deserves, especially with respect to material wealth,” [5] or in other words — greed.

On December 9th, 2008, Governor Rod R. Blagojevich initiated a rude awakening to citizens of Illinois. Local news coverage gave a shocking account of his morning affair, complete with handcuffs and a trip to the federal magistrate. It seems Governor Blagojevich had secretly conspired, on numerous occasions, to not only sell President Obama’s Senate seat, but other state positions as well. Many have questioned the motivation behind this appalling act, but the answer is clear. What Governor Blagojevich orchestrated was a, “wide-ranging scheme to shakedown campaign donors and politicians for high-paying posts and millions of dollars in campaign contributions.” [2] Once again, greed has poked its head into an area that is now rampant with greed and corruption – politics.

The answer to this dire problem is simple. There has to be a manner in which individuals on the lower end of the wealth spectrum can, through legitimate means, earn their way to the top. The result of such a manner would mean the end of this deadly sin, provided these individuals do not succumb to greed once a top position has been achieved. Lao Tzu, the founder of Taoism, once stated: “Give a man a fish; feed him for a day. Teach a man to fish; feed him for a lifetime.” [1] It is time to stop handing out fish every day while the greedy elite remain in control of the pond. If the current judicial system refuses to administer adequate punishment to the individuals who con their way to the top, then there must be some way for others to rise up and compete. Until this method has been established and put to sufficient use, the world’s wealth will be relentlessly barraged by this deadly sin known as greed.

Sources:
[1] Chan, Alan, “Laozi”, The Stanford Encyclopedia of Philosophy (Spring 2009 Edition), Edward N. Zalta (ed.), URL = .
[2] Coen, Jeff, Rick Pearson, John Chase, and David Kidwell. “Illinois Gov. Rod Blagojevich arrested on federal charges.” Chicago Tribune 10 Dec 2008, early ed. Print.
[3] Colbert, Randy. “1percenters, 1%ers, one percenters are you ONE of them?”. The Colbert Minority Report. 19 Sep 2009. Blogspot, Web. 15 Nov 2009. .
[4] “Distribution of Wealth.” Wikipedia, The Free Encyclopedia. 8 Nov 2009. 15 Nov 2009. .
[5] “greed.” Dictionary.com Unabridged. Random House, Inc. 15 Nov. 2009. .
[6] McCool, Grant, and Jonathan Stempel. “Roomy Khan tipped several people in Galleon case.” Reuters 12 Nov 2009, early ed. Print.

I think I have figured out what the problem is with our current government. They feel as though simply throwing money at a problem as fast as they can possibly throw it will solve all of our problems. Well, they are wrong. I came across this nifty little site (govtrack.us) while doing some research into the first stimulus bill and found a startling piece of information.

Do you know how long it took from the time good ‘ole H.R. 1: American Recovery and Reinvestment Act of 2009 was introduced to the time it was signed into law by our President? Exactly twenty-two days. And if that fact is not staggering enough, remember how much money this “package” is estimated to cost the American people. Only a measly $715 billion! I do not think I could have spent one million dollars in less than a month, let alone almost a trillion!

In my opinion, this is the problem: Not enough time is being spent in deliberation before these huge bills are being passed. President Obama is making it seem as though we need to get these bills through Congress as quickly as possible, when this is simply not the case. Did we need to do something to prop up our collapsing economy? Yes. However, I think that when spending such a huge amount of our hard-earned dollars, the least they could have done was spend at least a few months in deliberation.

I am afraid to see what is going to become of our health care system at the rate these bills are flying through Congress. For once, I actually applaud the planned filibustering, because someone needs to get in there to slow Congress down. I feel the same with the proposed second stimulus package. This country is heading down the drain fast if the only idea Congress can come with is to throw money at problems to make them go away. To be honest, I do not mind if we throw money at a problem, but only after enough time has been spent to plan out a SOLUTION to the problem and not just a TEMPORARY FIX.

Congress, I beg you, please stop wasting our taxpayer dollars and time on useless temporary fixes. Take your time, and create a bill that will actually help us. That is the only way you will regain a smidgen of faith from me.

Here is the link to track H.R. 3200: America’s Affordable Health Choices Act of 2009. I will post the link to the second stimulus if/when it becomes available.

– Timothy Hawley

The 2009 American Clean Energy and Security Act (Cap and Trade)

1. Provide an overview of the legislation. Include the key legislative goals and points.
2. Is this truly a market-based approach for emissions clean-up?
3. Evaluate the bill. Will it work?
4. What changes would you make to the bill, if any?
5. What are the consequences of this bill?
6. Find three groups/organizations/foundations lining up to support or oppose the bill. Do these groups have a bias or a financial incentive to support/oppose the bill?

Task: After you completely and thoroughly address the above points you will write a letter to our Congressman (Todd Platts) urging him to read and address your point of view. This is to be an economic argument rather than a philosophical/ideological one. I realize that it is impossible to divorce ideology from economics, but use your best judgement. I will not be reading these (unless you want me to). I will provide you with an envelope. You will return this envelope to me sealed and addressed to Representative Platts. We will stamp these in class and mail them out. [...]

Hmm, I guess I had better start by reading the bill:

Committee on Energy and Commerce
American Clean Energy and Security Act of 2009 Discussion Draft Full Text
American Clean Energy and Security Act of 2009 Discussion Draft Summary
American Clean Energy and Security Act of 2009 Discussion Draft Section by Section Summary

Well, after much scrutinizing of this bill I think I am ready to begin answering the questions.

1. The intent of the American Clean Energy and Security Act of 2009 is to create jobs which will remain in the United States, thus minimizing the risk of outsourcing; lessen our dependance upon foreign sources of oil and create more of a dependance on products and services that can be provided within our borders; and to alleviate any risk of global warming (I say risk due to the controversy surrounding the topic of global warming at the moment). The legislation contains four titles to go about achieving these goals:

(1) A clean energy title that promotes renewable sources of energy, carbon capture and sequestration technologies, low-carbon fuels, clean electric vehicles, and the smart grid and electricity transmission;
(2) An energy efficiency title that increases energy efficiency across all sectors of the economy, including buildings, appliances, transportation, and industry;
(3) A global warming title that places limits on emissions of heat-trapping pollutants; and
(4) A transitioning title that protects U.S. consumers and industry and promotes green jobs during the transition to a clean energy economy.

2. Personally, I feel as though this could have been a strictly market-based approach, but now that the government has control I think we will see the results of this bill become more of a market socialist-based approach for emissions clean-up. Market socialism is an “economic system representing a compromise between socialist planning and free enterprise, in which enterprises are publicly owned but production and consumption are guided by market forces rather than by government planning.“

Source:
“market socialism.” Encyclopædia Britannica. 2009. Encyclopædia Britannica Online. 04 Dec. 2009 .

3. Of all the reading I have done, the general consensus is that this bill will “eventually” work. I have to say eventually because I do not believe that we will feel the effects right away as most individuals would like to see. A lot of complaints I hear regarding legislation such as the stimulus package are that the effects just are not being felt yet. And I believe part of the problem is that we, as Americans, are generally impatient. We want to be able to see something happen right away with such a large portion of our tax dollars being spent upon passage of these bills. However, it is simply not a reality. Personally, I feel pretty satisifed with what I have studied thus far. Of course, we must all remember that this is a bill being designed by our government so of course it is not going to appear like it was written by a group of intelligent individuals.

4. I really like the idea of a credit system, but it just seems like greed is going to find itself a new target. I mean, can we really trust that these companies will act honestly whether buying or selling these credits? I think that the past has shown us that that answer is a resounding NO. The concept makes perfect economic sense, though:

The trade: It will be relatively cheaper or easier for some companies to reduce their emissions below their required limit than others. These more efficient companies, who emit less than their allowance, can sell their extra permits to companies that are not able to make reductions as easily. This creates a system that guarantees a set level of overall reductions, while rewarding the most efficient companies and ensuring that the cap can be met at the lowest possible cost to the economy.

Source: Cap and Trade 101

5. The biggest consequence that I am able to see is that we have let this problem go on for so long that now our government must step in to lend a hand. We should have never let it get to this point. I do not know if it was laziness, a lack of funds, or a lack of interest that kept us from developing more efficient forms of energy but now we’re stuck with the government’s idea of “green”. Of course, many Republicans and Democrats alike have stepped up in opposition to this bill, but I must ask this question: Where were you a few years ago when the idea of “going green” first started?

6. Many groups have stood up in support and opposition to this bill. A recent voice in strong opposition to this bill is the No-Cap-And-Trade Coalition. Their opposition is due in part to their concern “about the devastating impact a cap-and-trade scheme could have on American families and the faltering US economy.” Businesses that are in support of this bill include Avista Corp. and Gap Inc., both of which have been prominent clean energy providers. These companies have a strong reason to support the legislation because they will be the ones with the most to gain when credits are handed out. Since they are already participating in clean energy, they will most likely have many leftover credits which they can then sell to make additional profit.

[more to follow; continue to check back]

No matter how bad our nation seems to be doing, we need to stop and give thanks. Even if you have no place to live, no job, or no family, you still have your freedom. And that, my friends is enough for you to be more than thankful. Right now we are facing one of the most drastic economic situations our nation has ever faced. We need to be strong, and we need to work together no matter if our political views match. Parents, begin encouraging your children to take part in the issues affecting our nation. It is they who will be affected by the decisions being made now, not you. Anyways, enough ranting. I hope everyone had as wonderful a Thanksgiving as I did. As I sit here stuffed and ready to fall asleep, I just want to leave you with a few Thanksgiving quotes that illustrated the importance of this day.

“Thanksgiving is the holiday of peace, the celebration of work and the simple life… a true folk-festival that speaks the poetry of the turn of the seasons, the beauty of seedtime and harvest, the ripe product of the year – and the deep, deep connection of all these things with God.” — Ray Stannard Baker (David Grayson)

“Perhaps it takes a purer faith to praise God for unrealized blessings than for those we once enjoyed or those we enjoy now.” — A.W. Tozer

“God gave you a gift of 86,400 seconds today. Have you used one to say “thank you?” — William A. Ward

“It is delightfully easy to thank God for the grace we ourselves have received, but it requires great grace to thank God always for the grace given to others.” — James Smith

“Thanksgiving is nothing if not a glad and reverent lifting of the heart to God in honor and praise for His goodness.” — Robert Casper Lintner

“Got no check books, got no banks. Still I’d like to express my thanks – I got the sun in the morning and the moon at night.” — Irving Berlin

God bless you all and have a wonderful Thanksgiving!
Timothy Hawley

I’m really beginning to question the motives behind Sarah Palin’s new book,
Going Rogue. Of all the footage I have seen from the book tours, there does not seem to be one person there for Sarah Palin’s “politics”. The general consensus is that most are there to meet the “celebrity”. Has her book really made her that deserving of this “celebrity” status, though? Personally, I think the answer to that question is no, and so does a fellow Huffington Post blogger by the name of Geoffrey Dunn whose recent post, “The First Ten Lies From Going Rogue,” pretty much sums up her entire book.

1. The Cover Byline: Palin didn’t write the book by herself. Most books with known ghostwriters list their co-author’s name on the cover. In this case it was Lynn Vincent (a well-known homophobe). Going Rogue does not.

2. The Subtitle: An American Life. Aside from her infancy, Palin has really spent very little time outside of Alaska, and according to John McCain’s campaign advisors, was shockingly unfamiliar with American geography and American history. “Alaska,” as John McPhee noted in his resplendent Coming Into the Country, “is a foreign country…Its nature is its own.”

3. Going Rogue features Palin’s obsession with Katie Couric and characterizes the CBS anchor as “badgering.” Palin refused to prep for the Couric interview because she was more concerned about her popularity in Alaska than about what was best for the campaign. Was it really badgering to ask what books or periodicals Palin read? Palin further claims that Couric suffered from low self-esteem. In fact, according to those close to Palin, it’s the former governor who suffers from low self-esteem and frequently projects that onto other women.

4. Palin asserts that there was a “jaded aura” around McCain’s political advisors once she entered the campaign. In fact, McCain’s aides bent over backwards to protect Palin and to try to get her up to speed on international affairs. In addition to not knowing whether or not Africa was a continent, according to sources in the McCain campaign, Palin also didn’t understand the difference between England and Great Britain. And much, much more.

5. Palin contends to have been saddled with legal bills of more than $500,000 resulting from what she calls “frivolous” ethics complaints filed against her. The lion’s share of those bills resulted from the ethics complaint she filed against herself in a legal maneuver to sidestep the Troopergate charges being brought against her by the bipartisan Alaska Legislative Council.

6. Palin rather astonishingly claims that she was saddled with $50,000 in bills for the legal fees associated with her vice-presidential vetting. A) She was not vetted; B) A McCain campaign advisor says this is “categorically untrue.”

7. Palin states that she found out only “minutes” before John McCain’s concession speech that she would not be allowed to make remarks of her own introducing McCain. In fact, she had been told at least three times that she would not be allowed to give the speech and kept lying about it in the hopes of creating some last-minute chaos that would allow her to assume the dais.

8. Palin asserts that her effort to award a license for a natural gas transmission line was turning a “pipe dream” into a pipeline. Although she claimed otherwise in her speech at the GOP convention, there is no pipeline. It remains a pipe dream.

9. Palin implies that the McCain campaign intentionally bungled the release of information regarding her daughter Bristol’s pregnancy and refused to let her rewrite it. In fact, the McCain campaign allowed her to rework the draft, but the original version went out accidentally. Palin reportedly accepted the recalcitrant staff member’s apology for the mistake, then when she left, ordered her immediately dismissed of her duties.

10. Palin complains that McCain’s senior advisors, most notably Steve Schmidt, forced her to “stick with the script” they provided her. In fact, Schmidt & Co. were encumbered with the task of keeping Palin from lying and misleading people throughout the campaign, from her well-documented lies about the “Bridge to Nowhere” to her duplicities about her husband Todd’s assocation with the Alaska Independence Party. Palin’s lying to those in the McCain campaign was so troubling to them that they cringed every time she went “off script.”

And that’s just for starters.

This was one of the first posts regarding lies found in her book, and more soon followed:

Palin’s book spreads falsehoods about clean energy legislation
“Going Rogue”: The 18 Biggest Falsehoods In Palin’s Book
“Going Rogue” Fact Check: Palin’s Book Goes Rogue On Some Facts, AP Says
The Prolonging of Palin

And that’s not all. There are also various videos floating around that illustrate my point just as well:

Source: SARAH PALIN BOOK SIGNING – Interviews with Supporters [READ DESCRIPTION]

For some reason I am having trouble embedding this next video, but feel free to click the link — it’s worth a few laughs.
Source: Jon Stewart Explains To Conservative Pundits Why He Doesn’t Like Sarah Palin (VIDEO)
Jon Stewart: “[..] when you peel back the pretty, shooty layers of the Palin onion, there’s no onion. It’s just a conservative boiler plate mad lib: ‘Freedom is good and taxes are–ooh I need an adjective–how about, I don’t know, silly?’ And the worst part it’s a mad lib delivered as though it were the hard-earned wisdom of a life well lived.”
—————————————————————————————————————————–
I’m not really sure what we as intelligent, observant individuals are supposed to think when we watch clips like these or read stories about all the lies found in her book. I mean, I guess I would respect her more if it didn’t seem like she’s just trying, yet again, to play the victim when she really isn’t deserving of the title. And for those who claim it’s just another “Liberal attack on Sarah Palin” with all the lies being pointed out from her book — I feel sorry for you. A lie is a lie, plain and simple. If she expects to place herself in the same crowd as politicians, no matter if it’s “politics as usual” or not, then she is going to be held accountable to the same standards as a “real” politician. And I use “real” because: (1) I do not believe Sarah Palin is an example of one (real OR not), and (2) I do not believe we have any real politicians in office today. We would have to go back quite a long time to find anyone worthy of the title “real”. Her lies are not going to be excusable simply because she’s a “strong”, “real”, “hockey mom”, “down to Earth” “Conservative”.

I do not disagree that she is a strong woman. She seems to be very determined to make a difference, even if the way she goes about attempting this seems kind of confusing sometimes. She is a very real, down to Earth woman who has strong desire to fight for causes she believes in. I respect her as both a parent and as a wife. However, I don’t think that she shows quite the qualifications to run this country. Before all the Conservatives jump on my back, calling me a “Liberal” and all the typical ranting and raving — I don’t think Obama is any better. Personally, my ticket would have contained McCain/Biden for the past election. I think what ruined McCain’s campaign was the fact that he chose a Vice Presidential candidate that he had to spend too much time babysitting. As she proved on countless interviews (Sources included at bottom), she is absolutely clueless when given an interview and allowed to speak her mind.

To sum this all up, surely — surely — the Republican party can find someone more qualified than Sarah Palin to run in 2012 or it will most definitely be a rude awakening for many Conservatives. Don’t waste money on her book until she decides she can write the truth, and not more attempts to play the victim. And a final word on her book — If what she is saying is the truth, why haven’t any McCain campaign members stepped up to support her? It seems to me like most can’t distance themselves anymore than they already have. Well, Mrs. Palin, I can only hope you change my mind by 2012, but as of right now I have to give you a verdict of: Celebrity.

What do YOU think? Do you agree? Disagree? Let me know, prove me wrong!

Interview Sources: (read transcripts for further laughs)
Palin Sets The Record Straight
Exclusive: Sarah Palin
Exclusive: Sarah Palin Part II
Sarah Palin Speaks Out

Have a wonderful day and hopefully you had a happy Thanksgiving!
Timothy Hawley

“For I know the plans I have for you,” says the Lord. “They are plans for good and not for disaster, to give you a future and a hope.”
Jeramiah 29:11

Love her or hate her, there is no denying that Sarah Palin has a way with words. Here are just a few examples of Sarah Palin’s brilliance. After reading these, can someone please explain to me how Sarah Palin is even mildly ready to lead this country? I’m not out to promote our current president, because there are many things he has both done and said that I strongly disagree with, I’m simply saying that Sarah Palin would hardly be a suitable replacement in 2012 if she chooses to run for office.

“As Putin rears his head and comes into the air space of the United States of America, where– where do they go? It’s Alaska. It’s just right over the border.” –Sarah Palin, explaining why Alaska’s proximity to Russia gives her foreign policy experience, interview with CBS’s Katie Couric, Sept. 24, 2008

“The America I know and love is not one in which my parents or my baby with Down Syndrome will have to stand in front of Obama’s ‘death panel’ so his bureaucrats can decide, based on a subjective judgment of their ‘level of productivity in society,’ whether they are worthy of health care. Such a system is downright evil.” –-Sarah Palin, in a message posted on Facebook about Obama’s health care plan, Aug. 7, 2009

“Who calls a shot like that? Who makes a decision like that? It’s a disturbing trend.” –Sarah Palin, pushing a conspiracy theory that “In God We Trust” had been moved to the edge of coins because of the Obama administration (the change was made by the Bush administration in 2007 and was later reversed by Congress, before Obama took office), West Allis, Wisconsin, Nov. 6, 2009

“We believe that the best of America is not all in Washington, D.C. … We believe that the best of America is in these small towns that we get to visit, and in these wonderful little pockets of what I call the real America, being here with all of you hard working very patriotic, um, very, um, pro-America areas of this great nation.” –Sarah Palin, speaking at a fundraiser in Greensoboro, N.C., Oct. 16, 2008

“Ohh, good, thank you, yes.” –Sarah Palin, after a notorious Canadian prank caller complimented her on the documentary about her life, Hustler’s “Nailin Paylin,” Nov. 1, 2008

“Well, let’s see. There’s ― of course in the great history of America there have been rulings that there’s never going to be absolute consensus by every American, and there are those issues, again, like Roe v. Wade, where I believe are best held on a state level and addressed there. So, you know, going through the history of America, there would be others but ―” –Sarah Palin, unable to name a Supreme Court decision she disagreed with other than Roe vs. Wade, interview with Katie Couric, CBS News, Oct. 1, 2008

“All of ‘em, any of ‘em that have been in front of me over all these years.” –Sarah Palin, unable to name a single newspaper or magazine she reads, interview with Katie Couric, CBS News, Oct. 1, 2008

“[T]hey’re in charge of the U.S. Senate so if they want to they can really get in there with the senators and make a lot of good policy changes that will make life better for Brandon and his family and his classroom.” –Sarah Palin, getting the vice president’s constitutional role wrong after being asked by a third grader what the vice president does, interview with NBC affiliate KUSA in Colorado, Oct. 21, 2008

“They are also building schools for the Afghan children so that there is hope and opportunity in our neighboring country of Afghanistan.” –Sarah Palin, speaking at a fundraiser in San Francisco, Oct. 5, 2008

“I think on a national level your Department of Law there in the White House would look at some of the things that we’ve been charged with and automatically throw them out.” –Sarah Palin, referring to a department that does not exist while attempting to explain why as president she wouldn’t be subjected to the same ethics investigations that compelled her to resign as governor of Alaska, ABC News interview, July 7, 2009

If I am correct in assuming that a public option, if included in the bill, is not an option that is meant to last forever — only to stimulate competition with private insurance and cause them to restructure their greedy ways — then what is the problem that everyone has with the public option? I fail to see how stimulating competition is such a bad thing if it means that in the long run it will cause private insurance companies to lower their costs and thus save us money.

“PolitiFact”

If I am wrong, please provide sources and correct me. But I want to know — What do YOU think?

I am sick and tired of hearing the typical Conservative tirade “Obama has so many Czars! Oh, no! What are we going to do?!” Blah, blah, blah.

Please, for the love of God, read this article and be informed. Stop spewing Glenn Beck without double-checking what he is saying. I’m not saying that everything he has said about Czars is false, I’m simply saying MAKE UP YOUR OWN MIND, do not let ANY media control your thoughts — conservative OR liberal!

“The Truth About Czars”

“FactCheck”

“President Bush vs. President Obama”

Feel free to leave your thoughts and opinions regarding Czars. However, make up your OWN mind!

Have a wonderful Thanksgiving,
Timothy Hawley

In one of our many end-of-the-day school discussions, my friends and I broke into discussion about a topic that seemed, at first, to hold quite a bit of merit. The topic is one becoming more and more talked about as popular media sources such as the Washington Post have begun offering their stamp of approval. It is known as Peer-to-Peer Banking (P2P Banking), and this new form of banking may very well determine the future of finance and how we go about managing our finances.

But what exactly is “peer-to-peer banking”? P2P Banking, also known by its more common title, P2P Lending, is “an online system that allows individual members to complete financial transactions with one another by using an auction style process that lets members offer loans for a specific amount and at a specific rate. Buyers have the option to look for an amount and rate of interest that meets their needs.” What is neat about these systems is that they can organize borrowers and lenders by any number of varying descriptions such as risk, demographic information, etc.

Other key facts include:

“Since P2P banking does not use third party banking institution intermediaries the rates and terms are often much more favourable for the members.”
AND
“Unlike conventional banking where the spread between deposit rates and lending rates are consumed to finance the bank’s administrative and logistic expenses, both lenders and borrowers get to save such costs, while paying certain commission to the P2P portal provider and/or the credit rating agency.”

Let me set up an example, using two individuals: Bob (borrower) and Larry (lender).

Bob’s old car has finally died on him. He needs a car to get to and from work, but does not want to take out a loan from the bank because the interest rates will be too high for him to afford. He creates an account on one of the various P2P Banking websites and completes all the necessary forms about his income, past credit history, etc. Now, Bob is ready to make his first post. He enters into a borrower form that he is looking for $5,000 to purchase a car to use for work. He is looking for an interest rate between 7-8%, though this is usually not shown to potential lenders. He now must wait for individuals to begin lending him money.

Larry has recently received a bonus at work in the amount of $10,000. He’s not real familiar with the stock market, and is looking for safer methods of investing the money. He sets up an account with the same P2P Banking service as Bob, and fills out all the necessary forms. He begins scrolling through the list of individuals seeking loans and catches his eye on Bob’s post. After much consideration he decides he will offer Bob $1,000 at 9%, which is higher than what Bob was hoping to pay out.

Here is where the beauty of it all comes together. Let’s say, for example, another lender notices Bob’s post, observes that Larry has already contributed $1,000, and decides to contribute $4,000 more at a rate of 7% to complete the loan. This loan now has two contributors at two different interest rates, one Bob favors and one he dislikes. These interest rates will not be averaged together to form the final rate of 8%, which is a rate Bob favors. This means that Bob will get his $5,000 for the car and will have to repay the loan at a rate of 8%, which is good for the lender of $4,000 but slightly negative for Larry. As you can see, P2P banking can be used as more than a bank; it can be used as an investment opportunity as well.

While this may seem like a potentially great way to do banking or minimal-risk investing, there are still a few problems that need to be taken into account for which we struggled to come with counter-arguments. There must be a “minimum requirement” system in place which you must reach in order to create an account. Examples include: yearly salary, job security, household income, credit score, etc. This would prevent having random “Joe Schmo’s” sign up for the sole purpose of taking people’s money. In addition to this system, there would also need to be a method of verifying that all data provided is factual and not falsified.

The question we struggled most with was how to prevent an individual, one that is able to pass all necessary requirement tests and create an account, from taking the lenders’ money. If you have a perfect credit rating, an ample income, and no reason that can be found in the numbers for duping someone out of their money — how do we stop YOU from taking someone’s money?

Primary Source: “Lending Club”

Feel free to share your ideas and questions regarding this new system. Let me know what YOU think!

Remember, always make up your OWN mind!
Have a wonderful Thanksgiving,
Tim H.

As of my first watch of this interview, I’m not sure what to think. Maybe it’s just me but doesn’t it seem like the majority of the people standing in line are only there to meet the “celebrity” and have their books signed — not because they’re actually interested in her political ideas? Maybe I’m wrong, and if so, I apologize to those who were waiting in line.

Personally, I do not feel as though Jackie was “attacked” by the so called “liberal media bias” as she phrases it. If you are going to advertise yourself as an educated conservative (which she has very well proved, at least to me, in her various blog posts at http://redwhiteandconservative.wordpress.com), then I think it should have been relatively easy for her to not only offer a rebuttal to Norah’s statements about Palin’s support of the bailout, but also offer a better reason for liking Palin other then the typical Constitution response: “Uh, she upholds the Constitution, the document that made this country so great. And that’s what we need to go back to. We have gone so far from the Constitution that we are reaping the benefits- the consequences of that right now.” Then, when asked for a specific example she rattled off the typical Conservative viewpoint of smaller government and putting more control in the hands of the people. While these are all great and dandy beliefs for the Conservatives, I would have hoped that she could have come up with a better reason for liking and supporting Sarah Palin other than, “She believes the same things I do.”

Jackie, you seem like a very intelligent girl, and I was just as nervous as you the first time I did a live interview on television. However, please do not let ANY media control your thoughts and opinions. I like that you dedicate yourself to the research required to formulate your own opinion, but a word of advice would be to distance yourself from the media as a whole. While Fox may be the only “Republican” station, always be sure to pay attention to the other news organizations as well, even if you do not like what they are saying. It’s always good to have information from BOTH sides of an argument before forming your final opinion. Do not always stop with the side you tend to favor.

Best wishes,
Timothy Hawley