Scott Conlon

Today the House passes a new bill that will bring reform to the credit card industry. The new Credit Card Reform bill, set to be signed into law by President Obama before Memorial Day, will have a huge impact on the credit industry. The bill, written by Banking Committee Chairman Christoper Dodd (D-Conn.), was passed by the Senate on Tuesday.

Senator Dodd stated, “Many Americans depend on credit cards to get by in this economy, and today they have won a giant victory that ensures they are protected from practices that would drive them further into debt, while also making our economy stronger.”

The new Credit Card Reform Bill will prohibit credit card companies from increasing rates on existing balances unless the borrow is at least 60 days delinquent. Then if the borrow pays ontime for the next 6 months, the interest rate will be restored to its original rate. On cards with more than one interest rate, such as interest on new purchases and a different interest rate on balance transfers, payments will apply to the debts with higher rates.

Treasury Secretary Timothy Geithner on Tuesday said the bill “will help create a more fair, transparent and simple consumer credit market.”

However, Credit Card executives said it will have an immense impact on how credit card companies do business and will force them to charge higher interest rates and annual fees to both delinquent customers and those in good standing.

“This bill fundamentally changes the entire business model of credit cards by restricting the ability to price credit for risk,” said Edward L. Yingling, the chief executive of the American Bankers Association. He stated that it would make lending even more risky and that, “It is a fundamental rule of lending that an increase in risk means that less credit will be available and that the credit that is available will often have a higher interest rate.

When credit cards were introduced about 50 years ago, there was a one-size-fits-all approach where interest rates and fees were roughly the same rate for everyone. The common rate was about 18%. The industry became deregulated in the 1980s which was around the time the credit score system was introduced. Now credit card issuers were capable of determining which customers were a higher risk and which were not so risky.

One of the major revenue sources for the credit card industry is that of interest and fees associated with customers that do not pay their bills off in full each month. With this loss of revenue, credit card companies will have to turn to the lower risk customers who once benefited from lower interest credit and rewards programs. Annual fees will likely return to rewards programs such as frequent flyer miles and cash back rewards. Interest rates will likely rise across the board for all credit card customers and 0% transfers will likely be non-existant. The new legislation still allows issuers to increase interest rates for future purchases as long as they give a 45 day notice.

This morning when I checked my mail, I received a letter from CapitalOne. At first I tought it was another offer for low balance transfers or to join one of their affiliates, but to my suprise it was a statement of change of Terms of Use. The interest rate on my credit card had been increased. I had heard discussions in the news that Obama’s administration has been pushing for Credit Card Reform, but it was not until today that I really began to understand what this means for us.

As someone who has experience with both paying off credit cards in full each month and also making minimum payments while carrying over balances, I am very skeptic of this new Credit Card Reform bill that will soon be passed by President Obama. I think it is imperative for credit card companies to be able to determine which borrowers are higher risk and charge higher interests on those that are of more risk. Higher interest rates help discourage borrowers from spending money on products they do not need or cannot afford. So as someone begins to carry higher balances and more debt, credit card companies will increase those rates. Not necessarily to discourage those from spending more but also to help secure their credit. It is just like auto insurance. If someone has more tickets or more accidents on their record, they are a higher risk to the insurance company that is insuring them. If someone has an accident, then their rates should be increased on that auto policy. Otherwise the auto insurance industry will have to raise rates on all of their policy holders in order to still be profitable.

Government regulations on businesses such as this Credit Card Reform have many negative impacts. Businesses want to succeed and be profitable. Companies also need to be competitive and therefore will offer such programs as cash back rewards or increase wages for their employees. By regulating businesses and causing them to change business rules and practices, you will ultimately have negative impacts on the economy as well. Obama wants to free up the credit market and help small businesses gain more access to credit; however, he forces credit card companies to raise interest rates across the board to “stabilize” the economy. Lower profits for credit card companies may also turn into job losses in the near future. I sure hope this new reform bill turns out better than I am picturing i will.

What do you think?

HTC recently announced their plans for the Smart Phones of 2009.  which will include atleast 3 smart phones with Android operating system.  In February the HTC Magic was the 2nd Google phone to hit the market which some are referring it to the G2 Phone.  The handset is currently being sold in Europe by Vodafone.

Will the new HTC Magic be the T-Mobile G2 phone available here in the United States? Nothing has been announced yet regarding plans to release this phone to US carriers but many speculate that T-Mobile is picking this phone up as their successor to the T-Mobile G1. In October 2008 T-Mobile starting selling the first phone to run on the Android operating system, the HTC Dream, which T-Mobile branded as the G1.

Although not all the details have been released about the new HTC Magic but the phone has some similarities but many differences to the G1 phone. Like the G1, the Magic will run with the open source Android Operating System and use Bluetooth, WiFi and GPS technologies. Instead of a keyboard like the G1 has, the Magic will only have an onscreen touch keyboard. The phone will include a video functionality where the G1 only had a still camera capability. The new HTC Magic will also have a sleeker design with a glossy finish rather than the matte finish. A new useful feature will be in the Gmail application that provides multi selecting of emails similar to how Gmail on a web browser operates. The G1 Phone or HTC Dream only allows for deleting or selecting options one email at a time.

The next several months will be exciting for the smart phone industry. Will the new HTC Magic be the next T-Mobile G2? When will HTC release their new smart phones to the US market? As the leader in phones also carrying the Microsoft Windows Mobile OS, HTC is taking charge of the Android market as well.

Remember watching on TV and seeing these huge funky phones? Not only were they huge and heavy, they were extremely expensive. In the early 1990s only about 1 % of the population had a “cellular phone”, remember they were not called cell phones at that time. Well in 2005 about 51% of Americans were carrying a cell phone.

Without suprise a new study about cell phones has hit the news. This time it is not about how many people are using cell phones, it is about how many people are not using home land line phones. It appears that having Cell-Phone only households is becoming the norm in today’s society. But this does not come to us as a surprise.

If you still own a home phone line, how often do you use it? Do you notice yourself always putting down your cell phone number now whenever filling out forms requiring a contact number? With all the unlimited plans, the high minute usage plans, the family plans and Add-a-Line plans available, who would need a land line?

Since it does not suprise you that the number of cell phone only households is on the rise, do you know which state has the highest cell phone only population? Do you think that a state which had more people on the go, a younger population or the most single living people would be on the top of that list? According to a recent study, Oklahoma and Utah have the highest percentage of Cell Phone Only Households. Oklahome has a whopping 26.2% with Utah closely trailing at 25.5%. That is 1 out of 4 people in these states have only a cell phone line and do not have a home land line. As we see more unlimited plans and more people switching to include data plans, I think this number will continue to grow. Out of the 3 other people that have home lines, I wonder how many of those still have long distance charges or if they use services such as Skype or Vonage VOIP phone service.

To see where your state ranks in the list of Cell Phone Only Households check it out on FoxNews.com.

The rate of foreclosures decreased by about 10% in January 2009 from the prior month, December 2008. The rate of foreclosures is still up almost 18% from January 2007. So what is President Obama and Congress doing to recover the housing market and slow down the foreclosures? The recently passed legislatures is supposed to do just that.

President Barack Obama announced a $75 billion plan to lower monthly mortgage payments and keep up to four million distressed homeowners in their homes. How exactly will this plan help in the housing recovery? Is this new legislature just another bailout plan? Who will be affected by a foreclosure bailout? How do I benefit from Obama’s Stimulus Plan if I do not yet own a home?

There are two main focuses on the recovery of the real estate market. The Homeowner Affordability and Stability Plan, also known as the Making Home Affordable program, is aimed to assist more than 9 million people with nearly 6 million homes that are either in or at-risk for foreclosure, a record high. The stability plan will allot $75 Billion to aid homeowners that are in distress with paying their mortgages. The money is being used to renegotiated mortgages (Home Affordable Modification Program) to help lower payments and keep residents in their homes as well as help refinance homeowners’ mortgages (Home Affordable Refinance Program) to a lower interest rate who have not been able to do so due to the value of their homes decreasing dramatically. The idea is that homeowners should not have a mortgage note that costs more than 31% of their income. Through the Home Affordable Refinance Program, refinancing aid is available for four to five million homeowners who receive their mortgages through Fannie Mae or Freddie Mac and who have a solid payment history. The Home Affordable Modification Program aimed at helping those that have been struggling to pay their mortgage through no fault of their own. This includes homeowners that have recently had a change in circumstances that causes financial hardship or is facing a recent or imminent increase in the payment that will burden financial hardship. To learn more about the “Making Home Affordable” Program visit FinancialStability.gov.

So what if you have been paying your mortgage and are not at risk of foreclosure? Many people have raised concerns that this plan is bailing out people that have made bad decisions in buying a home and feel that it is not fair to help those that are unable to pay for their homes. Obama has made statements that this plan is to help everyone in this struggling economy. If you own a home and your neighbors home is foreclosed, that lowers the value of your home. As Obama stated, neighborhoods are struggling as home values have been dropping due to the number of foreclosures. This stability plan will help reduce the number of foreclosures thus saving the value of many Americans’ homes.

For those that have been thinking about buying their first home but have been hesitant due to the current state of the economy, the American Recovery and Reinvestment Act of 2009 has provided a great incentive to do so. Under the new tax provisions recently signed into law, a new home buyer that purchases their home after January 1, 2009 and before December 1, 2009 will benefit from the new tax break. Under this new Refundable First-time Home Buyer Credit, if you purchase a home during this period you may be eligible for a credit of $8,000. Previously the First-time Home Buyer Credit of up to $7,500 was a no interest loan that needed to be paid back over the course of 15 years, but now the credit does not require the funds to be paid back and acts solely as a one time credit on either your 2008 or 2009 tax returns. If you are looking to purchase your first home during this time you can learn more about the Refundable First-time Home Buyer Credit on the irs.gov website.

So no matter what your circumstance is regarding the housing market, it is important to know that it affects us all and if needed, there may be help or benefits out there for you. Whether these new legislatures will indeed impact the real estate crisis or not, only time will tell.

Since the American Recovery and Reinvestment Act of 2009 was passed into law on February 17, 2009, much speculation has risen about whether or not the 2009 stimulus package will work on recovering the US economy. Since Barack Obama began putting together plans to stimulate the economy and create more jobs, critics have been taking sides. Those that have not shown support have been calling his stimulus package a Spendulus Package or have been joking about how much $13 a week would really help struggling Americans.

Where did the talk about $13 a week come from? The recent new American Recovery and Reinvestment Act of 2009, that was signed into law, includes new tax provisions. The “Making Work Pay Tax Credit” of this new bill will provide a refundable tax credit of up to $400 for working individuals and $800 for married taxpayers filing joint returns. Starting no later than April 1, 2009 you should begin to see a credit of $13 a week in your paycheck. This will last until 2010 when it will be changed to $8 a week until the $400 is reached.

Will this “Making Work Pay Tax Credit” really help stimulate the economy. Many people have been mocking the bill saying ‘What is someone going to do with an extra $13 a week?’ There is much speculation that this will have very little stimulation on the economy and that it will take too long to make a difference in the job market.

The Making Work Pay tax credit is only part of the American Recovery and Reinvestment Act of 2009. Other tax provisions such as the Refundable First-time Home Buyer Credit, Money Back for New Vehicle Purchases and the Economic Recovery Payment are all part of the new bill.

For More Details on the American Recovery and Reinvestment Act of 2009:
Recovery.gov
Tax Provisions
First-Time Home Buyer Tax Credit

So I was a little late to getting on board with the Tmobile G1 phone with Google’s Android operating system. But I finally ended up getting it. Was I disappointed? Was it worth buying the Tmobile G1 phone?

In case you are not familiar with what the G1 and Android are, I figured I would tell you a little about it. Google was one of the founding members of the Open Handset Alliance, which is a group of companies including mobile handset makers, application developers, some mobile carriers and chip makers. The role of the Open Handset Alliance (OHA) is to develop the standards for mobile devices. One of the standards already developed by the OHA is Android, the open source operating system for mobile phones.

Android is open source which allows developers to tap into the software to customize the operating system and to develop applications that make use of the operating system functions. There are many features of Android that really make it a powerful piece of software. Google provides an Android Software Development Kit which provides the necessary tools and standard APIs to develop applications for the Android operating system. One of the most powerful features of Android is the complete multitasking environment it possesses. This means the operating system can run multiple applications in parrallel and any applications in the background an draw attention to itself by producing notifications. Applications on Android can also embed web content. HTML, javascript and style sheets can be embedded through the WebView on Android. Many other features help make Android one of the most powerful operating systems on the mobile devices.

So what does this have to do with the T-Mobile G1 phone? Well the G1 was the first and currently the only phone with the Android operating system on the market. Was buying the Tmobile G1 phone worth it?

The phone has a touch screen similar to that of the iPhone and many other smart phones currently available. It does not have multi-touch like the iPhone but it does have a built in QWERTY keyboard that can be used simply by sliding the screen open. There are not as many applications available as the iPhone but since the Android phone will eventually be on more phones with more carriers, Android apps will eventually out score the availabilty of iPhone apps. I would say the largest problem with the T-Mobile G1 phone is the battery life. The phone for me sometimes does not even last the whole day. This is overcourse with use of applications, talk time and texting. Since you can charge the phone with a wall jack, USB port or car charger, you usually can keep it charged. There are applications you can also install that help you with power management so that you do not drain the battery really fast.

Other than the poor batter life on the phone, I would have to say the Tmobile G1 was worth the buy. Since I was able to renew my contract with Tmobile when buying the phone I saved $200. It only cost me $179. I mostly wanted to get the phone so I can begin learning the development process in building applications for the Android operating system. So I will write blog entries in the future to let you know what I think about developing for Android and how those applications work with my T-Mobile G1 phone.

If you also have the G1 phone or have used it, then let us know what you think about it and what applications you find useful or fun.

Despite the opposition from the majority of Senate Republicans, the Democrats and the Bush White House have pushed for a $14 Billion bailout of the big 3 auto makers in the US. The emergency loan program will require the auto makers to restructure their businesses and become viable in the auto industry. One of the big concerns by many that are opposing the bill feel that the restructuring plans should be in place before the loan is given rather than quickly providing the loan and allowing several months before a restructure plan must be presented.

The government is on a spending spree and the Bush administration continues to drift further from the conservative ideals he once held. I understand the repercussions that could occur from not bailing out the auto industry but our country will not gain strength in the global economy if we continue to produce products that are not competitive on the global market. We need to focus on production that will increase our export goods. Investing more money on alternative energy sources, medicine, technology, machinery and innovation will be more beneficial than attempting to keep afloat businesses that have not been successful in the global economy.

I have mixed feelings about whether we should bail out the auto makers. I really do not think we should be bailing out businesses especially those that will take a long time to be viable and will require much more than the initial investment. On the other hand our economy does need a break to have a chance to recover before taking another big hit. Maybe putting the inevitable on hold will give our economy time to prepare for an end to our nations auto manufacturing.

The auto maker bailout has not yet been passed through the Senate. I do not think it will pass this time around but in the end will make it into legislature. Only time will tell. I am just thankful to be a young investor during these times of hardship.

Barack Obama elected the next President of the United States. An election to remember and history in the making. Both Barack Obama and John McCain fought a hard campaign and now that the election is finally over, we all as Americans, need to come together in support of our new President of the United States. Although Obama is mixed with a white mother and a black father. Although he was raised by white grandparents. Obama will still be our first black president. It represents how great America is and how honored we as citizens of the greatest country on Earth should be.

The road ahead brings tough times with many challenges. What direction Obama takes the country is unknown and will begin to unfold in the coming weeks and months. With a Senate and House dominated by the Democratic party we can certainly expect changes to come.

Although my candidate of choice did not prevail in the Presidential Election 2008, I will stand behind the new Commander in Chief and President of the United States. I do not share the same idealogy as Obama and in fact have very different views, but we both belong to the greatest association, The United States of America.

If you did not get a chance to hear John McCain’s speech tonight be sure to find it on Youtube!

It is videos like the one below that really matter. This video will be seen more and have more of an impact than Obama’s 30 minute paid commercial. With the 2008 election coming down to the final days, many people might question, “Do I really know who Obama is?”, “Can Obama be a Commander in Chief of a military that does not have his support and who does not have his support?”.

Check out the “Dear Mr. Obama” Video:

Have you been thnking about starting a blog but do not know really what to do? Starting a blog is very easy, but once you start your blog, you will need to keep writing new content and constantly do work to get people to read your blog. I am going to go over several steps to create a blog and give you a few pointers on how to get your blog to stand out from all the rest.  First you should answer a few questions before you get started.

1. Why do you want to start a Blog?
2. Do you have a specific topic you are interested in writing about (i.e. Sports, Politics, Business)?
3. Can you make time to write at least a couple posts a week?
4. Are you interested in making money with your Blog or are you doing it just for entertainment?  (I will share more about this at another time)
5. Do you want to write with other like minded individuals or do you want to be the sole author of this blog?

Once you have an idea of what you want to do with your Blog the next step would be to get one setup.  You can use sites like http://www.blogspot.com or http://www.wordpress.com to setup a blog through their website.  However you have more flexibility to host your own blog and you can have your own domain name like my scottconlon.com domain. 

If you go the route of hosting your own domain, then you need to register a domain name.  I usually use http://www.startlogic.com to register my domains but you can use http://www.godaddy.com, http://www.name.com or any of the other options out there.  Since you will also need web hosting (space on the internet for your blog), you may want to consider using one of the hosting companies since they somtimes register the domain for free with your plan. 

After setting up your web hosting you will need to install the blogging software.  I use and highly recommend, WordPress as the software to use.  It is simple to setup and has many additional functionalities you can add to your blog, called PlugIns.  Many web hosting companies have a simple installation process built into your webspace already for you. 

You then get to have the fun on choosing a theme or layout for your blog.  WordPress has thousands of free themes out there that you can download.  They are very easy to install and you can always change your theme whenever you want.

After setting up your blog you are ready to begin posting! I recommed making some changes in your settings so that the URLs in your blog or what is called search engine friendly, rather than the standard URLs that contain things such as http://www.yourblog.com/p?23 which does not look as clean and is not well optimized for search engines. I will write more in the future on Search Engine Optimization that will further explain the reasoning for this method.

Once you begin creating posts to your blog be sure to submit it to the major search engines, tell your friends and family, post links on your social networking websites such as Facebook and MySpace, and start commenting on other people’s blog. You can start by commenting on this post! Check back for future tips on how to maintain your blog, make money with your blog and much more!