Fenorris Pearson: What Matters at the Top of the Corporate Ladder?

by Fenorris Pearson – CEO Global Consumer Innovation, Inc

Despite a growing number of women and minorities in the workplace, the directors of corporate boards remain mostly white and male, according to a new report on Fortune 100 companies. Women and minorities together account for less than a third of the directors on more than 60 percent of the boards examined, according to the report. African Americans represent 7% of all corporate board members.

In spite of these grim statistics, there is a great deal of hope for the possibility of women and minorities sitting in positions of authority. The more you perform and the higher you go up the corporate ladder, the less color matters. The truth is that corporations are seeking individuals who can enhance the bottom line. A good corporate manager doesn’t care if you are black or white, as long as you deliver the green.

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African American Money: CEO Lawrence Watkins with George Kilpatrick

Lawrence Watkins and George Kilpatrick Break down the secrets to success.  Click the image to listen!

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President Barack Obama Seeks to Stop Foreclosures for All Americans

His massive stimulus plan now signed into law, President Barack Obama is turning to attack the home foreclosure crisis at the heart of the nation's deepening economic woes.

His goal is to prevent millions of American families from losing their houses because they can't make mortgage payments.

"We must stem the spread of foreclosures and falling home values for all Americans, and do everything we can to help responsible homeowners stay in their homes," Obama said Tuesday as he signed his tax cut and spending package into law.

The ambitious plan he was announcing at a Phoenix high school Wednesday was expected to offer government cash to mortgage companies that reduce interest rates — and therefore monthly payments — for homeowners in danger of default, according to several people briefed on the plan. What remained unclear was how the government will decide who qualifies for relief.

One Democratic official familiar with the plan said it also would allow homeowners to refinance their mortgages if they owed more than their homes were valued. Still another section would give bankruptcy judges more authority to change mortgages. That last provision has been opposed by lenders, who said it would add risk and lead to higher interest rates.

 

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Credit Card Companies are Changing the Game On You

By Dr. Boyce Watkins

www.DrBoyceMoney.com

In case you weren’t sure, credit card companies are not out to help you. If you are financially illiterate and uninformed, they are going to exploit you. If you are worried about the financial crisis, they are going to prey on your fear to get money out of you. They are also doing exactly what the rest of us are doing: trying to remain protected in a fragile economy.

The stimulus is stymied. The bailout is a failout. The stock market has consistently given a “thumbs down” to every piece of legislation passed in response to this crisis. Our economy is like the sick man who won’t respond to antibiotics. While the results of the latest package are yet to be seen, the truth is that no one is sure what will work. Every company is out to protect their assets and hold on to their cash, which means they no longer have much interest in loaning money to you.

Yes, this is true even if you have a good credit score, which is the ironic part.

Customers are opening their monthly statements to find that credit card companies have started to either ration credit (give less of it) or raise the interest rate being paid on outstanding debt. This doesn’t even count all the dirty tactics used, like using your payments to pay off low interest debt first, quietly getting rid of the grace period or charging interest on your balance from the prior two months vs. the current one. Even when you’ve been making payments on time for years, banks keep raising the bar to maximize shareholder wealth. When liquidity is scarce, those giving out water demand a higher cost per bottle. Additionally, higher default rates have justified the increase in interest rates, but higher interest rates increase the likelihood of default. It’s a nasty cycle, really.

Lawmakers are trying to intervene. Congressional hearings have taken place. Banks are being scolded by senators who keep telling them that this form of business practice is unethical and that they are gouging the American consumer. All this might be true, but what is also true is that you can’t force banks to loan you money. Also, it is very difficult, if not impossible, to legislate a strong economy.

If you have a less than stellar financial history, there is an even greater opportunity for your credit card company to raise your interest rates. If you have defaulted on other loans or are a slow payer in other areas, then they have no problem telling you to pay up or ship out. The days of easy money are long behind us, and companies are dramatically shifting their business practices.

The bottom line is that THEY’VE GOT YOU. They know that you’ve become addicted to the debt they so readily offered in the past, and this debt has become the lifeblood for the lifestyle to which you’ve chosen to become accustomed. They know that they can charge you a higher interest rate because you can’t do anything about it. Like a drug addict who is angry about paying more for his product, you really don’t have any other choice.

Well, maybe you do.

Here is one solution: tighten your economic belt. That means putting together a financial fitness plan today that consists of getting rid of as much debt as possible. I’ve mentioned in prior articles and on our website that paying off debt can be one of the best investments you make with your money. This is especially true if you have a stable job and are paying a high rate of interest to your credit card company.

So, the Dr. Boyce Challenge for this month is simple: Create a budget which includes the steady elimination of credit card debt. That means you should list every single expense you have for the entire month on one piece of paper or a spreadsheet. Don’t leave anything out. Count the money you want to use for getting your hair done, your nails, paying your mortgage, car note, whatever. Count everything. That will be your first step toward obtaining financial fitness.

As you create the budget, allocate at least 10% of your monthly after tax income toward reducing credit card debt. So, if you earn $3,000 per month after taxes,$300 per month should be allocated toward removing credit card debt, not including interest. So, if you owe $5,000 in credit card debt, you can remove this debt in roughly a year and a half. While $300 may seem like a lot of money to find in your budget, it’s there if you look hard enough. In fact, if you spend $10 per day on lunch and/or coffee, you can find the bulk of the money by taking your lunch to work. Make this one of the first bills you pay, not the last. The last bill is the one that only gets paid half the time. It’s easier to negotiate with creditors if you don’t need them so much. Take small steps toward finding your financial freedom.

Next month, we will move to step 2 of the Dr. Boyce Financial Challenge. While I confess that this change won’t be easy, I can promise that it will be worth it in the end. Be strong and remain focused, this is your opportunity to shine.

Dr Boyce Watkins is a Finance Professor at Syracuse University and author of “Financial Lipo 101: From financial fat to fitness”, to be released in April, 2009. For more information, please visit www.DrBoyceMoney.com.

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Black Financial Scholar Boyce Watkins Tips on Consumer Confidence

Keeping Your Cool During A Financial Meltdown

by Dr. Boyce Watkins
http://www.boycewatkins.com/

If you listen carefully to the words of Treasury Secretary Henry “Hank” Paulson and Ben “Big Ben” Bernanke (chairman of the Federal Reserve) you might notice a trend in their language. The word “confidence” is used a lot when they speak. Many of their monetary proposals are not necessarily valuable for their financial power, but also for their psychological power.

Some of you may wonder what confidence has to do with anything. After all, if you’re broke, confidence doesn’t exactly put money in your pocket. If you’re 100 pounds overweight, confidence won’t help you win the Olympic 100 meter dash. When you are flying on a crashing plane, confidence doesn’t keep the plane from slamming into the ground. But confidence is important to an economy, and one of the most significant drivers of economic growth. In fact, over confidence has driven US economic growth for the past 10 years. Here are some reasons that confidence matters in the minds of Hank and Big Ben:

1) Confident consumers spend money
If you think you might lose your job next year, are you going to max out your credit cards? I certainly hope not. If you are worried about being able to make ends meet, are you going to buy that big screen TV? Not unless you want your wife to leave you. So, even if it doesn’t hold any truth, the mere forecast of a weak economy is enough to make many Americans hold off on consumer spending, one of the great driving forces of the American financial system.

2) Confident companies invest money and hire workers
Investments involve risk. Your hunch may work out, and it may not. If you don’t believe the economy is getting better, you are not going to consider taking that risk. No one plans to go to the beach if the weather man says that it’s going to rain. When economic rain is in the forecast, companies pull out their umbrellas and hold off on new projects. This reduces the number of jobs in the economy, because nearly every job created in America is the result of someone making an investment.

3) Confident Americans do not take their money out of banks
In case you didn’t know, your bank does not have your money. Your money is part of a large base of financial capital that is loaned out to individuals and consumers seeking to get a good return on their investment. So, without investing, your bank would have no interest in paying you any interest at all. So if, say, 30% of all customers of the same bank decide to get their money out at the same time, the bank would have serious financial problems. It is a lack of confidence that could cause customers to “run” on their bank and take out their money.

4) Confident investors keep their money in the stock market
The stock market is a place where fortunes are made and lost. Some part of that fortune is psychological, given that no asset can have a value which exceeds that which someone is willing to pay for it. When investors lose confidence, they take their money out of the stock market, and reductions in demand for stocks lead to massive paper losses in the market. Additionally, most Americans are “momentum traders”, meaning that when the market goes up, they tend to buy more, and when it goes down, they tend to sell. History shows that it is actually the opposite approach that tends to work best.

5) Confident banks make loans
Banks have to keep a certain portion of their funds on hand at all times to meet federal requirements. If they are fearful that their customers might come and demand their cash, they hold onto their capital to ensure that it is available. If they are afraid that their borrowing customers will not be able to repay loans due to a weak economy, they also hold back on issuing new loans. The truth is that when economic forecasts are grim, conservative bankers become even more fearful than the rest of us.

The bottom line of this article is that confidence matters. So, the next time you hear Ben Bernanke give a speech, you can be confident that he is going to use language that makes you feel more secure. Whether you choose to believe those words is up to you.

Dr. Boyce Watkins is a Finance Professor at Syracuse University and author of “Financial Lovemaking 101: Merging Assets with Your Partner in Ways that Feel Good”. For more information, please visit http://boycewatikns.com/

Black Money, Black News, Black Finance: The Crisis Breakdown

The Financial Crisis: A Finance Professor's perspective

by Dr. Boyce Watkins
www.BoyceWatkins.com

1) FDR had it partially right when he said that "We have nothing to fear but fear itself." While we have other worries as well, the greatest obstacle to economic progress is the HUGE psychological impact of Americans watching the stock market plummet right in front of their faces. This is going to cause consumer spending, lending, borrowing and investing to freeze like a deer in stadium lights. When people stop spending, economies start dying.

2) This crisis was a long time coming. De-regulation pushes down on the economic gas, but increases the chances of an economic crash. The dramatic growth of the past 8 years was a result of the same policies that are leading to the huge challenges we are faced with today.

3) Much of the impact of this crisis is a financial illusion. A large percentage of the devaluation in stock and home prices is driven by the fact that the original value was incorrect in the first place. When prices are out of whack, they must correct themselves. While a crisis may also be a correction, a correction is not necessarily a crisis.

4) Prepare for a period of "Financial McCarthyism" in America. Many baby boomers are closing in on retirement, and scared to death. To boot, many of these individuals have not properly prepared for retirement. When Americans get scared, politicians get nasty. We will likely see some of the most Draconian legislation in history.

5) What makes this crisis such a concern is that even before the meltdown, the economy was already quite fragile. With soaring gas and food prices, the economy was the #1 issue on the minds of most Americans. The decline of many financial services firms was, for the most part, a logical continuation of the fact that many homeowners were defaulting at the start of the year. This crisis is most certainly going to shift the political landscape and might give us our first Black president.
Dr. Boyce Watkins is a Finance Professor at Syracuse University and author of the forthcoming book "Black American Money". He does regular work in national media, including CNN, ESPN, BET and CBS. For more information, please visit www.BoyceWatkins.com

Black Money: Fed Cracks down on Predatory Lenders

WASHINGTON - To prevent a repeat of the current mortgage mess, U.S. Federal Reserve Chairman Ben Bernanke said Tuesday that the central bank will issue new rules next week aimed at protecting future homebuyers from dubious lending practices.

The new rules will crack down on a range of shady lending practices that has burned many of the nation’s riskiest “subprime” borrowers — those with spotty credit or low incomes — who were hardest hit by the housing and credit debacles.

The housing, credit and financial crises have bruised the economy. Growth has slowed and employers have cut jobs every month so far this year.

In prepared remarks to a mortgage-lending forum in Arlington, Va., Bernanke said that “it is unrealistic to hope” that financial crises can be entirely eliminated, while maintaining an innovative financial system. “Nonetheless, recent experience has illustrated once again that financial instability can have serious economic costs,” he said.

Meanwhile, the Federal Reserve is also considering giving squeezed Wall Street firms more time to draw emergency loans directly from the central bank to help them overcome credit problems, Bernanke said.

In an extraordinary action, the Fed in March agreed to let investment houses go to the Fed — on a temporary basis — for a quick, overnight source of cash. Those loan privileges, which are supposed to last through mid-September, are similar to those permanently afforded to commercial banks for years.

“We are currently monitoring developments in financial markets closely and considering several options, including extending the duration of our facilities for primary dealers beyond year-end should the current unusual and exigent circumstances continue to prevail in dealer funding markets,” Bernanke said.

Black Money: Michael Vick the Millionaire is Now Broke

Michael Vick declares bankruptcy.

Vick filed Chapter 11 papers in U.S. Bankruptcy Court in Newport News on Monday. The seven largest creditors listed in the court papers are owed a total of about $12.8 million.

The suspended Atlanta Falcons quarterback hopes he "can, after the conclusion of the bankruptcy case, rebuild his life on a personal and spiritual level, resurrect his image as a public figure, and resolve matters with the NFL such that he can resume his career," according to the filings.

Vick is serving a 23-month prison sentence at the U.S. Penitentiary in Leavenworth, Kan., after pleading guilty last year to bankrolling a dogfighting ring. He was subsequently suspended indefinitely without pay and lost all his major sponsors, including Nike. He also faces state charges related to dogfighting.

The debt includes part of a signing bonus that the Falcons are seeking to recover.

After the plea on dogfighting charges, the Falcons tried to recover about $20 million in bonuses Vick earned from 2004 to 2007. But a federal judge held that Vick is entitled to keep all but $3.75 million of the money paid to him for playing football through the 2014 season.

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Black Money Tips: Ways to Get Rich

 

The smart way to get rich - MSN Money

Feel like taking a risk in hopes of hitting the jackpot on a rocket stock? #mediaarticle #articleBody #segment {HEIGHT: 1100px!Important}

Before you make the leap, you might want to get a grip on risk

Prices go up, prices go down, and you never know which way they're headed next. A lot of folks would say, well, that's risk. But really that's only half the picture. The other half is what you do in response.

After all, there's nothing wrong with risk itself. What's important is how you handle it. To know how to manage the risk-reward equation, you're first going to have to get a grip on what you're playing with -- and how much you can afford to lose.

It's pretty hard to talk about investment risk without falling into a lot of clichés about roller coasters and bungee jumping and being able to sleep at night. That imagery is entertaining but maybe not terribly helpful. Instead, let's start with the basics. We don't want to lose money, right?

"Obviously, negative return is risk," says Lee Schultheis, the CEO and chief investment strategist at AIP Mutual Funds in White Plains, N.Y.

Pros such as Schultheis use some pretty powerful computer-driven tools in their analysis of risk. Here are just a few of the concepts that are important to them:

• Standard deviation, much beloved of finance professors, measures how much the results of a process tend to vary. The higher the standard deviation, the more unpredictable the results.
• Correlation, used by those managing diversified portfolios, tells you how much two assets move together to reinforce -- or offset -- performance.
• Value at risk, often used by hedge funds, measures the likelihood that you will lose all of your money in any time period.

All three are mathematical concepts and require some comfort with statistics to calculate -- but not to understand. Each translates the uncertainties of risk into mathematical estimates of likelihood that offer a good basis for planning.

If you have an investment with a high standard deviation, close correlation to other investments or a high value at risk, you're taking on significantly more risk. If more than one of those factors is involved, watch out.

Let's say you're thinking about doubling up an investment in technology stocks. Results in that sector are going to be erratic to begin with.

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Black Money Tip: It is not Always Best to Buy a Home

 

This is an article explaining some reasons why you might not feel it necessary to purchase a home.  I agree.  What is also true is that there are convenience reasons that an individual may not want to buy: if you are only living in a city for a short period of time, don't want the hastle and expense (not to mention taxes) of home ownership, you have a business that is already giving you a good return or you have a great tax write-off elsewhere.  Owning a home is great, but it is more important to remember the importance of eventually owning SOMETHING.  It doesn't have to be a house. 

Real-estate agents have been pushing the virtues of homeownership since homes were invented. Or since real-estate agents were invented, anyway. Paying a mortgage, they insist, is a can't-miss investment (the tax breaks, the appreciation, the thrill of fixing your own roof!). Renting is for simpletons who don't like keeping their own money.

But does owning a home really trump renting? With the economy stumbling, house prices falling, and credit tightening, many housing experts are questioning the conventional wisdom. "Over the last decade, it may have been true," says W. Van Harlow, an economist at the Fidelity Research Institute. "Clearly, there are periods where [the housing market] will dominate. But give this market correction another 18 months, and it may not be true anymore."

Not so hot. The housing boom produced endless stories of homeowners getting twice what they paid for their homes. But "prices don't always go up," says Jay Butler, director of realty studies at Arizona State University. Even a boomtown like Phoenix has seen median rates of appreciation climb only 4.6 percent a year since 1981. According to a Fidelity study published this year, the return on a dollar invested in real estate in 1963 barely beat that of a low-risk treasury bill.

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Long Term Financial Consequences of Divorce

s you may already know, June is the most popular month in this country for weddings. So now that the marrying month is almost over, I thought it might be a good idea to turn the focus to - what else? - divorce!

I don't mean to be a downer about it, but the reality is, the divorce rate in America has hovered pretty close to the 50% mark for years now. And while there are lots of financial (not to mention emotional) complexities related to divorce, financial planners say one of the most common mistakes people make after getting un-hitched is simply failing to update the beneficiary forms on their retirement accounts.

And that can lead to all kinds of unintended financial consequences years, or even decades, down the road.

Here's why: if you get divorced, you'll probably make a point of updating your will to exclude your ex-spouse. But what you may not realize is that your will has no bearing whatsoever on who inherits any money sitting in your qualified retirement accounts - including an IRA, 401(k), 403(b) or traditional company pension plan - at the time of your death.

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black money,african american money,black love,black relationships

Black Money, Black Wealth: The Dangers of Debt Consolidation

Fred Harteis News Articles - Debts and debt consolidation strategies go together in the economy like peanut butter and jelly. You don't need a financial planner to comprehend the basic logic: Combining multiple payments into a single monthly check lowers interest rates and can positively impact your FICO score.

"It's easier to take on the 1,000-pound gorilla who comes to the front door as opposed to 20, 50-pound gorillas pouring in through separate doors and windows," says Boyce Watkins, author of "Financial Love-Making 101: Merge Assets With Your Partner in Ways That Feel Good," and a professor who teaches personal finance planning. "Psychologically, consolidation is very comforting."

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Higher Credit Card Limits: The Danger of it all

There was an article I saw on the dangers of higher credit card limits. During the housing boom, banks began increasing credit card limits in response to higher home equity values. Many people took the bait, as Americans dramatically increased their borrowing, using their homes as ATM machines.



Ed McMahon was no exception. Recently appearing on Larry King Live to ask for financial help, he discussed how his high income expectations led him to continuously borrow against the value of his home through the years and he eventually ended up in foreclosure.



Call me evil, but I didn't feel sorry for McMahon. There are millions of hard-working Americans with real jobs who had to fight through foreclosure without the luxury of begging for a bailout on Larry King Live. This is not to be insensitive to Ed's situation, but I think that his irresponsibility was reflective of not just many extravagant people in Hollywood, but also of many Americans who think that the financial sunshine will always be bright.



The lesson to learn from the article above is simple: set budgets, don't use extra credit card capacity to have things that you don't really need, be financially cautious. When thinking about money, keeping the worst case scenario in mind is a good financial policy to live by. Most of us can't go on Larry King's show to get a bailout.

Black Love, Black Money, Black Relationships: When It's "Cheaper to Keep Her" in Your Black Marriage

Black love can be a wonderful thing, except for when it goes wrong. I am sure some of you have seen the typical “unhappy couple”. You know who they are: they may pretend that their marriage is wonderful on the outside, but there are a pile of scandalous secrets behind closed doors. The secrets may involve hidden bank accounts, secret gay lovers, or perhaps even some nasty abuse. Some even think they represent the best that black love has to offer, but every now and then, you get to witness tiny hints of an unfulfilled existence. You then realize that if there ever was a couple that needed to be divorced, it’s this one. So, you continue to witness their agony, wondering deep down why they don’t just call Dr. Kervorkian and have him put their marriage out of its misery. Actually, ending their marriage might end your own misery as well.

When you finally muster up the courage to ask your buddy why he doesn’t go ahead and pull out the marital machete, he gives you the words you’ve heard in so many bar room jokes, “it’s cheaper to keep her”. While these statements are stereotypically from men, you hear more and more women saying the same thing these days. You may also hear your friend tell you that he/she can’t afford to lose the financial support provided by their spouse. Either way, you feel sorry for the couple, because they’ve made one clear admission: “Whatever I have in my bank account is worth far more than my personal happiness.” That is what I would call bad Financial Lovemaking.

If our emotional fulfillment was suddenly converted into money, many of us would be bankrupt. However, there are many people in third world countries who are filthy rich with life satisfaction. This doesn’t understate the significance of their financial hurdles, but it does remind us that money, if not used as a tool to pursue happiness, can ultimately become a barrier to personal joy.

One of the trappings of a capitalist society is that we are taught that money is the ends, rather than the means. Money is a tool to enhance your life and your relationships, it should not be the reason you are in the relationship in the first place. That’s like buying a new car just so you can get the radio.

If I were given a choice between being dirt poor and happy vs. filthy rich and miserable, I would surely choose the dirt. You see, a person who endures unhappiness in order to protect his wealth is missing the point. The goal of money is to make you happy. So, using money as an excuse to not pursue happiness in your life is like saying “I am going to starve to death because I really want to stay in this restaurant.” If the restaurant isn’t feeding you, you might want to consider eating someplace else. That might be an example of good Financial Lovemaking, since part of the Financial Lovemaking process is getting comfortable with your own relationship with money.

I am not an advocate of divorce in black marriage, nor do I judge those who’ve made the decision to split. But I can say that if you have no ideological problems with divorce, and money is your only reason for not going through with it, it might make sense to reconsider your priorities. If happiness and money were put on a scale next to one another, love would be the 3,000 pound elephant and money would be the 2 ounce cricket. All choices in the black love and money balance should lead to short or long-term satisfaction, there really is no other way to say it.

Dr. Boyce Watkins is a Finance Professor at Syracuse University and author of “Financial Lovemaking 101: Merging assets with Your Partner in Ways that Feel Good.” For more information, please visit www.financiallovemaking.net.

What I learned from Bill O'Reilly about Money

by Dr. Boyce Watkins
www.BoyceWatkins.com

I learned something about the power of money last night. I received an email from one of our readers on Your Black World, who simply said, “Bill O’Reilly is coming after you again.” I took it in and got back to what I was doing. I expected O’Reilly to make another smear attack this week, since a good terrorist always hits the target multiple times.

O’Reilly Bin Laden’s latest target was my poor chancellor, Nancy Cantor. Sending one of his goons (some call them correspondents) to the campus, Dr. Cantor was asked why she is allowing “the good name of Syracuse University to be ruined by a ‘racist’ like Boyce Watkins.” Translation: to some, a “racist” is any black person who speaks up for black people. I accept that.

O’Reilly never really came at me directly, as I and some other black scholars have refused to appear on his show. I don’t fault the ones who choose to appear, but I don’t consider a platform legitimate just because it has a few viewers. Instead, he felt that going after my chancellor and the alumni of Syracuse University would be a more reliable tactic.

I couldn’t agree with O’Reilly more, perhaps the chimp is smarter than I thought.

Our campus is in the middle of a billion dollar fund raising campaign, and I am sure there are those who are sickened by the fact that one of the most visible faculty members on campus is the subject of racial controversy. Financial theory teaches us that risk management and minimization are critical to maximizing popularity and profitability. Controversy is risk, and too much risk hurts your ability to raise money. Oprah knows this all too well, as her political moves have diminished her show’s brand and base during the past year.

As Barack Obama’s experience reminds us, race is not a comfortable conversation, even when presented in the most diplomatic fashion possible. The backlash is far greater when you are direct and honest. What’s interesting is that O’Reilly couldn’t exactly cite why he was so obsessed with me, nor could he point to any strong evidence to support his “race baiter” assertions. The mere fact that he labeled me a “race monger” was enough to get his disciples up in arms. Bill O’Reilly should change his name to Bill Oprah-Reilly, as he has an amazing ability to manipulate his minions and their small, impressionable minds.

According to Bill O’Reilly, I am using the Presidential campaign to engage in “villainous pursuits” to promote a radical agenda. Being the good and noble American that he is, his goal is to ensure that “race hustlers” like myself don’t use their “hate-filled speech” to manipulate the results of the 2008 Presidential Election. Bill O’Reilly has become Martin Luther King Jr in his fight for truth, justice and political purity. God bless him.

My finance lesson this week came from watching Bill O’Reilly squirm. He was boiling mad at me, and even his fellow conservatives couldn’t quite figure out why (note the confusion on the face of the silly conservative radio show host, Laura Ingraham). The reason O’Reilly had become obsessed with me and my words is because of the dirty secret exposed by MSNBC host Keith Olbermann: A group with which I am affiliated, The Your Black World Coalition, has mobilized an intense email, phone and letter writing campaign to O’Reilly’s corporate sponsors, the FCC and the producers of the show. The ultimate objective is to hold O’Reilly’s corporate sponsors accountable for supporting a man who has consistently engaged in dirty tactics to defame Jeremiah Wright, Barack Obama and other respected individuals in the black community. While O’Reilly is certainly entitled to Freedom of Speech, I won’t have him unfairly assaulting and defaming my respected colleagues, and using my money to do it. While I give O’Reilly credit for being a good financial student, he must remember that I am ultimately the professor.

In reference to my many “lies” to smear O’Reilly, Keith Olbermann asked Bill one simple question: “If that’s what Watkins said, where are the lies?” In naming Bill O’Reilly “The Worst Person in the World” for his attacks on me and the chancellor, Olbermann quoted my reference to O’Reilly’s statement about wanting to have a “lynching party” on Michelle Obama. O’Reilly speaks of lynching the potential First Lady of the United States, and then has the nerve to call others racist and unpatriotic.

Given my training in finance, I learned one thing about living in a capitalist democracy: money makes people move. O’Reilly also understands this. Money makes good people do bad things and gives bad people an excuse to do good things. Money is the reason Fox News exists, and why this form of “capitalism gone wild” has destroyed the integrity of American journalism. Money is the reason that Barack Obama went from being a non-factor to becoming a target of The O’Reilly Factor and the reason that President Bush is sweating over the price of gas.

It is the ability to acquire resources, mobilize resources and take away resources that will change this election. This election will, in turn, change the world. Race matters, there’s no question about that. But money matters much more.

Dr. Boyce Watkins is a Finance Professor at Syracuse University and author of “Financial Lovemaking 101: Merging Assets with Your Partner in Ways that Feel Good.” This book is one of the definitive guides to Love, Money and Relationships, cited in Essence Magazine, Black Enterprise and other outlets. For more information, please visit www.BoyceWatkins.com.

Black Money, Black Wealth, Black Liberation: What black people should do right now

I spoke this weekend at an Entrepreneurship boot camp for The Urban Philly Professional Network. The head of the organization created something I consider to be profound and promising. He regularly gathers the black entrepreneurs of Philadelphia for networking events, training and motivation for their endeavors. I am proud of him because he has shown a consistent commitment to two issues of critical importance in the black community: black people working together and black people engaging in the ownership of capital.

Black entrepreneurship is not just about money. It’s about LIBERATION. The easiest way for me to control another man is for him to know that I am the reason his kids get to eat every day. That man will do exactly what I tell him to do, when I tell him to do it, and how I tell him to do it. Historically, African-Americans have been consumers of products and sources of labor. We have rarely been in a position to own or control capital. This country’s empire of wealth was built without black participation, as our ancestors were unable to transfer assets to their children. We all know that. Slaves were a form of human capital from which our country’s foundation was created. Theft from the black community is in the trillions.

As a result of this legacy, nearly every inch of the financial capital base of American institutions is controlled by someone else: The media, corporate America, academic institutions, you name it. Fox News freely spouts racism because Rupert Murdock and others like him control media infrastructure. Universities earn over 1 billion dollars per year from the families of black athletes because HBCUs don’t have the capital base to compete for these players. Jeremiah Wright and Barack Obama end up with distorted images because they’ve attempted to repair their reputations by appealing to the same institutions that destroyed their images in the first place. There are few black alternatives to media and corporate America, so our messages, leadership, outcomes and incentives are typically beyond our control. The controller of capital is the controller of destiny, so the social implications of capital ownership are vast.

The legacy of disproportionate capital acquisition also breeds a mentality in those who are controlled by capital. Some might call it the slave mentality. It affects all of us, from truck drivers to college professors. The slave mentality says your sole objective for obtaining education or skill is to work for someone else. We seek to find a job, rather than create one. Even most black doctors, lawyers and college professors fall victim to this mentality, as this is the tradition for many people of color. Risk aversion in the black community is strong enough to choke a horse, and any dreams of “going at it on your own” are squashed by relatives who encourage you to take the high paying, “prestigious” position at IBM or Stanford University.

The problem with the slave/laborer mentality is that there is a huge social price being paid when one spends his/her entire life drinking from someone else’s fountain: You are not free to pursue social justice and the platform on which you stand can be taken out from under you at a second’s notice. When injustice occurs around you, you are trained to sit silently and hope for the best. You don’t dare rely on ideas like “academic freedom”, because capitalism usually trumps idealistic concepts like democracy and freedom of speech. You can speak freely as long as it is financially convenient for the organization that controls you.

When I met with the black entrepreneurs and business owners of Philadelphia, I reminded them of the significance of their contribution to Black America. Owning a business is not about making a dollar, it’s about providing a critical supplement to the work of Dr. Martin Luther King, Jr. Black Entrepreneurs aren’t just finding a source of income, they are building black institutions. I reminded them that General Motors wasn’t built in a year, and that they should be proud of the trees they’ve planted, even if they are smaller than the strong, sturdy oaks around them.
There was a time when a high ranking position in the British Empire paid a lot better than joining the American Revolution. Black Entrepreneurs are the financial Harriet Tubmans of the black community: liberating people in mind, spirit and resources.

Many of us are so “blinded by the bling” that we take our eyes off the prize. Even those with high incomes remain as vulnerable as Katrina victims, as one unfortunate event can lead you to financial ruin. High income without an understanding of wealth building, diversity of resources and long-term financial stability is a recipe for financial disaster.

An understanding of the strengths and weaknesses of capitalism is critical to any social movement in America. Socially responsible financial machinery can serve to empower and sustain movements toward justice and equality. Models of entrepreneurship should be taught to every black child in America. Children should understand the nature of revenue generation, cost minimization and how business models work. The path to liberation in a capitalist democracy goes straight through Financialville. Controlling capital means controlling lives, and it’s tough to be free without it.

Dr. Boyce Watkins is a Finance Professor at Syracuse University and founder of YourBlackWorld.com. He is also the author of Financial Lovemaking 101, the definitive guide on black love, black money and black relationships. For more information, please visit www.BoyceWatkins.com.

Bad Financial Leadership in a Really Bad Recession

by Dr. Boyce Watkins - BoyceWatkins.com

The United States is respected throughout the world for its powerful economy. We are also, unfortunately, known for our arrogance. U.S. Monetary policy, headed by Federal Reserve Chairman Ben Bernanke, is both art and science, and the success of Alan Greenspan has forced any subsequent Fed Chairman to become a Financial Da Vinci.

The 2008 recession provides just the right landscape for an allegedly great monetary artist to strut his stuff. The US economy saw its financial chickens coming home to roost, and the recession was a long time coming. These financial chickens included excessive spending by American consumers, mixed with irresponsible borrowing and lending on the part of both individuals and banks. Personal responsibility is thrown out the window when discussing wealthy and middle class Americans, as financial leaders are called upon to bail out the banks, the consumers and everyone else.

Two great weapons in the arsenal of the Federal Reserve are government spending and interest rate cuts. Higher government spending increases consumer demand for the goods and services we continue to buy but almost never need. Interest rate cuts reduce the cost of borrowing for everyone in the economy. This marginal decline in rates serves to stimulate investment by all Americans, since the cost of borrowed money is lowered.

The government bailout package for 2008 included a massive spending bill, one that featured tax refunds and support to help consumers keep their homes, even if they were the causes of their own demise. Another financial steroid being employed has been the strong and consistent cuts of the Federal Funds rate by Federal Reserve Chairman Ben Bernanke. Bernanke has become known as “Bold Ben” by the media, who are consistently stunned by the Chairman’s massive and powerful attempts to control the economic downturn.

The strong and bold financial leadership by our government has been applauded by some, and demonized by others.

Republicans, known for being fiscally responsible, have created budget deficits our country has never seen. Between the Iraq War and the 2008 recession, spending continues to go up, even when tax revenues are expected to go down. The ready availability of additional lending to support our massive spending bills has our financial leaders behaving like teenagers holding a “really awesome” American Express card.

Continuously cutting interest rates may provide additional stimulation to the economy, but the problem is that cutting interest rates, allowing the value of the dollar to slide and frivolous government spending is a recipe for serious, horrific and uncontrollable inflation. Inflation is like a Pandora’s Box: Once it’s out, it’s extremely difficult to reign it back in. It’s hard not to feel that “Bold Ben” and “Big Bad Bush” aren’t gambling with our children’s futures and current taxpayer resources.

Sometimes, when you party too hard, you are forced to deal with the hangover. Americans have been blessed with a financial celebration that has lasted over a decade. We danced with lamp shades on our heads: not saving effectively, spending like crazy and borrowing to cover our financial insanity. But rather than simply allowing the party to end and letting everyone sober up, our financial leadership has taken on the irresponsible behavioral norms of American consumers. Their excessive rate cuts and spending increases have kept us pumped up on Financial Dope in order to avoid the impending crash.

This is not solid financial leadership, and something has GOT to give.

Dr. Boyce Watkins is a Finance Professor at Syracuse University. He is also the author of "Financial Lovemaking 101", the definitive guide to black love, black money and black relationships. For more information, please visit www.BoyceWatkins.com

Dealing with Bill Collector Harrassment

By Dr. Boyce Watkins - Syracuse University


Bill Collectors really want their money, like the rest of us. Some of them seem to feel that it is O.K. to resort to flat out thuggish intimidation to get their money back. That might work on The Sopranos, but it shouldn't work in real life.

Part of the reason abusive bill collectors can have their way with the public is because many citizens do not know their rights. Bill collectors prey on the uninformed in a terrible way: they threaten to have them arrested, they harass their relatives, call all hours of the night, the list goes on and on.

One woman successfully sued a rogue bill collector after he called her repeatedly with threatening language. The woman, a senior citizen, was told by the man to "Stop with the sob stories and pay your god damn bill!"

The Federal Trace Commission states that complaints against bill collectors are rising, reaching the highest level they've seen in the past 3 years. Most of the complaints focus on vulgar language, trying to collect more than the amount of the true debt, and extra fees, such as court costs.

There are rights that can protect you from bad and malicious bill collectors. You want to keep these in mind as you work yourself out of debt:

1) There is something called "The Fair Debt Collection Practices Act". If you are not familiar with this document, get familiar with it. You can read it by clicking here.


2) A bill collector cannot contact you at work if your employer does not approve of the contact. Let the bill collector know that this is the case and they must legally stop contacting you at your job.

3) Bill collectors cannot call you before 8 am or after 9 pm. The only exception is if you give them permission to do so.

4) A bill collector can only contact your friends and family if they are trying to find a way to get in touch with you. However, some of them may do this in order to harass or embarrass you. If that is the case, you may want to tell your friends to tell the bill collector, "She does not live here and I do not know how to get in touch with her. Please don't call here anymore." Then, get the bill collector's information from your friend and reach out to them when you can.

5) You can get them to stop contacting you altogether by sending them a letter telling them to stop. You still must pay the debt, but they won't be calling you during dinner.

6) The bill collector can not curse at you or use foul language and they must tell the truth about how much you owe. They cannot threaten to sue unless they are serious about it, and they can't touch your 401k or IRA.

7) If they call you, you can demand that they send you a written notice of the amount you owe and who you owe the money to. If you do not believe that the debt is yours, you can write a letter to them stating that this is not your debt. They must then send you proof that the debt is actually yours.

If you feel that a debt collector has violated any of these rules, you can contact the Federal Trade Commission at www.ftc.gov. Remember that you are not powerless in this situation.

Dr. Boyce Watkins is a Finance Professor at Syracuse University and author of "Financial Lovemaking 101", the definitive guide to love, money and relationships. For more information, please visit www.financiallovemaking.net.

Dealing with the Recession the Right Way: How to be Great in 2008

By Dr. Boyce Watkins
www.BoyceWatkins.com

You may have heard from the “financial experts” on TV that the recession is coming. For lack of a better phrase, many of us might be tempted to say “no duh”. Hearing a rich person on TV tell you that hard times are on the way is like being knee deep in water and getting a rain alert from the weather man.

Most Americans knew the recession was here when they started losing their homes in the subprime lending crisis. Many others learned about the recession when they could not afford heat for their homes, health care for their families, or college tuition for their children. According to a recent Gallup poll, 50% of all Americans expect their standard of living to decline. We don’t need a Suzie Orman, Larry King or some random journalist to tell us that.

As a financial researcher, I saw the recession coming 2 years ago during my fellowship with the Center for European Economic Research. The data showed, quite clearly, that Americans were managing their money like a pack of drunken sailors. We were over spending, over borrowing, under saving and under investing. That combination is never good in the long-term. Financial chickens always come home to roost.

We weren’t exactly seeing a good example from the Federal government, who has taken the word “conservative” out of the term “Conservative Republican”. Spending on a war that cost entirely too much, we were borrowing in a manner that even scared people who don’t care about politics. If our government were a college student, he would be getting an angry phone call from his mother.

It is not my belief that we should worry about the government when it comes to getting through the recession. The highly publicized “stimulus package” is only designed to stimulate you to do more of what got you in this mess in the first place. Giving Americans money back in hopes that they will spend it is like getting the drug addict high again to avoid the hangover.

“Personally responsibility” is a phrase often used by conservatives toward the poor. But it is also the key phrase here, as many have demanded that the government bail out those of us who bought homes we could not afford, stopped saving for retirement, or took extra hits from the “credit card crack pipe”. All of us make mistakes, but it is important to learn from the mistakes to move forward in prosperity.

Here are some quick lessons we can learn from the current economic downturn. The recession “out there” in the broader economy has little to do what is going on in your own home. In fact, my grandmother used to say that growing up “The Great Depression was business as usual for black folk. We didn’t know there even was a depression in the first place and we never really saw it come to an end.”

1) Budget Budget Budget – Most Americans don’t keep a budget and it leaves us in a financial mess. Spending money without a budget is like driving your car without a map. At the end of the day, you don’t really get anywhere meaningful and just end up running out of gas.

2) Use government help as a stepping stone, never as a crutch – if the government sends you a tax refund, save it. They are also making it easier for those with more expensive homes to get 3% mortgages, subsidized by tax payer money. Subsidized mortgages are a much better use of tax payer resources than blowing it on Iraq. Look into these options and learn what opportunities are available for you.

3) Take stock of your financial life – Calculate your net worth, which is the market value of all your assets, minus the debt you owe. Being in debt is not a terrible thing, but not trying to get out of debt can be a problem. If you are a professional, take account of the amount in your retirement savings and find out if your company has options for retirement investing.

4) Kill a Credit Card Today – Find a credit card and slice that son of a bitch in half. Most of us have 4 or 5 of them, so just pick one and see if you can go on a cash budget. In fact, you may want to give yourself a cash allowance in order to control your frivolous spending. Credit cards really do seem like free money, which impacts the perception of our spending.

5) Declare a One Month Spending Freeze – For four straight weeks, try to only pay necessary bills. Don’t go to the mall, don’t go out to eat, don’t buy any new clothes, shoes, hair, or fur coats for your puppy. Take the extra income you will get from the freeze (calculated in your budget) and put that money into your retirement plan or brokerage account. If you don’t have one, get one right now.
Habits are created by a series of seemingly insignificant actions, all headed in the same direction. The depths of despair serve as incubators for our greatest achievements. Let’s be wealthy and great in 2008.