STUDENT LOAN CONSOLIDATION

Loan is a financial package offered to borrower from lender with a mutual or written agreement with specified terms and conditions for some fixed tenure with an expected repayment and is usually borne with an interest. We may say that loan refers to consuming or using future purchasing power in present. Student loan is a structured package meant for students to finance their educational expenses.

Even after flexible loan plans, several students fall in debt trap due to over expenses and unplanned spending. In this scenario it is often advisable to manage the loan by consolidating it in a judicial way. While maintaining numerable loan repayment liabilities

which accounts to maintaining that much interest repayment trouble, maintaining records of all at the same time, it is better to transfer them into one consolidated structure and start repaying them through one. Often this helps to negotiate interest rate changes in a good way and acts as buffer during hard pressed times of high interest rates.

Students who often take care of their finances during their educational period may find this extremely time consuming as well as deviator from their daily chores.

According to 2002 statistical data, students on an average left college with $17,000 in loan debt. With loan amount steadily increasing in the last few years, the US Department of Education and other higher-education institutions have entered into a contract with private collection agencies to collect overdue student loans.

It is always advisable to understand the loan regulations, clauses, interest rates, repayment possibilities before taking a loan and to counter any for-coming financial crisis

or any unforced errors certain steps are perennially advised:-

• Savings: Just $20 every month savings can create wonder, by the end of college, one will have almost $1,000 saved for student loans. Hence a small but regular savings can do wonder.
• Budgeting: Many college graduates exceed their cost of living; hence it is often suggested for developing a budget and sticking to it. Determine what bills and payments have to be paid (i.e. student loans, rent) and then calculate how much is left over for additional expenses and as savings.
• Ask for advice: One shouldn’t hesitate to ask student loan counselor or collector for a flexible payment plan. Many organizations are willing to develop a payment schedule that works for both the consumer and lender.

Student loan debt consolidation program can only work, if he / she introspects his / her financial standing and work out his / her repayment program accordingly.

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Pamela

SEZ — SPECIAL ECONOMIC ZONE

# What is SEZ???

SEZ is an abbreviation of Special Economic Zone and refers to a development of geo-economic condition of a country. SEZ is a dedicated geographical area enjoying more trade liberty and lesser or a few governance that otherwise would have been applicable under a country’s typical economic and trade laws.

Infact SEZ covers a broad range which can be sub categorized into more zones:-

i. FTZ -- FREE TRADE ZONE

ii. EPZ--- EXPORT PROCESSING ZONE

iii. FZ --- FREE ZONE

iv. IE --- INDUSTRIAL ESTATES

Apart from these, there are Free ports, Urban Enterprise Zones and other categories. Jordan, Pakistan, Philippines, Poland, Russia, and Ukraine Brazil, India, Iran, Kazakhstan are among many countries to adopt SEZ to facilitate their Economic growth.

SEZ has a concept to allow ventures often private or joint ventures of government and private collaboration to improve domestic production Increasing national output, creating favorable environment for FDI and to be more competitive in world market.

Infact the laws are liberalized inclined more to waiving off taxes and duties and more friendly towards production and development.

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Pamela

DEBT---------- Views & Ideas

Debt is invariably a financial term frequently used and is created when a Creditor agrees with a Debtor to lend some money/ assets for some fixed tenure with an expected repayment and is usually borne with Interest attached with it. In Other terms we may say that debt refers to consuming or using future purchasing power in present. Standard of Deferred Repayment denotes the process and agreement on basis of which repayment shall be done having consent of both the parties.

There can be various Types of Debt depending upon the nature and characteristics:-

1) Secured

2) Unsecured

3) Private

4) Public

5) Syndicated

6) Bilateral

Apart from these there are some debts that have mixed features of the above mentioned.

Debt is often sought after and required for business purpose, investment strategies, purchasing goods and services at present with debt having used future purchasing power. However Debt has a long term effect on any country. Over volume debt has long term effect on National output and economic growth, infact there remains an impact with inflation as well as deflationary situation of a country.

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Pamela

Concept and Charges of credit card.

CREDIT CARD is often refereed to as plastic money and invariably has come up as one of the modern day variant of hard cash. It has developed a lot of convenience though it’s service does not come for free. There are a lot of charges and fees attached with it.

Let us sum up some important ones out of them.

FEES mainly include Annual fees. Annual fees depicts the charge which comes as a service charge a person pays to the credit card company. It varies anything between $15 and $ 60. Again there are exceptions to this feature since a lot of credit card companies don’t charge annual fees. It has also been seen that even after availing chargeable card, the charges have been waived off.

COST may include total annual cost which is quite important to ponder on. This follows a mathematical rule of fees (annual) plus the interest charges accrued plus any other charges. For a better usage of cards it is often said to understand the facts and figures.

RATES include Introductory Rate which is a charge applicable when a card is issued though nominal, is often variable. Talking about Annual Percentage Rate, it is an interest rate charged on any carry forwarded balance. There are two variety of APR and usually we see that fixed APR remains a bit higher than variable APR. But there always remain a problem with variable rate since it’s floating in nature, we don’t know what the rate can be.

Other fees will apply on your credit card varies due to various reasons. Late payment regularly draws late fines and charges. One should always remember the credit limit. ATM withdrawal service does not come for free and such charges have a different interest rate than a charged purchase.

However it all depend how a person realizes his strength and weaknesses and judicial approach to deal with their credit card.

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Pamela

Credit Card Reality

With high ride in market, debt has increased in leaps and bounds which had real acceleration from credit card companies and now the situation is completely different. They realize that the hard pressed Americans will not be able to pay their bills as the economy deteriorates.

The scenario is such that lenders and collectors are pushing themselves an extra yard to collect what ever they can before situations runs out of their hand. They are even forgoing parts of their money and debts due from the clients end. They are even stretching their time to extract what ever remains viable for them to recover from the debt ridden clients.

It is visible that big settlements have dried up. Banks and credit card companies are trying to gather their liquidity as much as they can. Data shows that Bank of America has constantly been waiving of debts, lowering interest rates, reducing loan balances, and this may provide much needed oxygen to the bank clients. Like wise several others like American Express, Chase Card are taking care of their clients who are on the verge of falling behind their bills and dues. It has been seen that several people are benefited with 20 to 70 percent waive off from their credit card bills. Thousands and billions of dollars are forgone with this ease out process. In past it has been seen that people are dishing out money from home equity, fetching money from retirement benefit funds / savings or by taking loans, going for help from known persons or from debt consolidation consultancy. While mortgage loans which are often big and complex, credit card issues are handled on individual basis. Also we see that credit score of the clients shooting down sharply.

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Pamela

Water

Data : Death of 1.6 million children per year.

Cause : Global water crisis.

Various arguments, meetings held for economic loss compounded by misuse of natural resources affecting economic development and crisis of water is no less significant.Europe uses an average of 200 litres of water per person, States consumes around 400 litres while developing nations consume around 10-12 litres of water though of inferior quality mostly contaminated water.

According to the Stockholm International Water Institute the degree of the crisis is at its peak. Statistics reveal that over 20 percent of global population faces acute shortage of water supply, hygiene and proper sanitation remains a day dream. In fact it acts as a accelerator for human degradation.

Passing through the phase of food crisis, economic slow down, environmental degradation sustainability of livelihood has become a real hardship for many. In fact global water consumption is doubly co-related with rise in population. With no substitute and rising cost, avoiding the burning matter shall aggravate the problem.According various apex bodies like Asian Development Bank, World Health Organization, UNO the task is quite uphill one with Sub Saharan Africa, various poor Asian countries will not witness the development in coming half a century. Economic Loss, degradation of humanity, loss of real man power if computed will account to incurring Credit Liability of Global Accounts.

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Pamela

Car Dealer : Thinking to buy?????????????????????
Person : Well well need to think over it!!!
Car Dealer : (After a long pause) OK......................!!

Recession in car sales

American car dealers are in real rough patch in this economic down turn.Will this recession eat up even more??? Will this recession be averted?? History says it is quite difficult. in fact down turn has began and car sales have taken the early hit.

The graphical representation makes it quite clear the percentage change in sales of new cars with time horizon of 1 year with 12 months before.

Adjusting it with inflation it is not positive, rather it 2% down. The down fall continued with figure slipping down to around 2.5 % by July.

A little introspection in this can help a lot. If we go back to mid 90’s

American Economy saw no happy feet in fact on contrary there has been several recessions.Even with several other indicators we cannot deny the hit of new car market. According to census bureau officials, revenue has been halved, keeping aside sales of parts, repair and services. Soaring gas prices, oil prices, liquidity crunch are just adding fuel to fire.

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Pamela

BOND MARKET


The bond market which is popularly known as Debt market, Credit or Fixed Income market is a platform where there are market participants in the form of buyer and seller buying and selling debt securities which usually are in the form of bonds. Bond market is often used as reference with respect to Interest rate or the Yield Curve graph since there is an inverse relationship between interest rate and bond valuation. Bond market usually means Government bond market & Government backed ones because of its size, nature of liquidity, absence of credit risk and hence response to change of interest rate.

Data shows that international bond market size has been around $ 50 trillion in 2006/07, while the USA bond market debt outstanding amount around $26-$27 trillion. Estimated data as of early 2007 shows that daily trading volume in USA hovers around $900 billion, transactions largely occurs around among broker – Dealer and Institutional Participants which is otherwise termed over the counter (OTC) market.
Bond/ Debt markets are mainly decentralized and absences of certain exchanges like cash, future and commodity markets. This has occurred as no two bond issues are exactly alike, and the number of different outstanding securities is far larger.

Market Structure
Market participants are essentially either Buyers (debt issuer) of funds or sellers (institution) of funds or often both.
Categorizing Participants:-
• Institutional investors
• Governments
• Traders
• Individuals

Investment in Bond market
Financial Institutions or Investment companies allow individual investors to participate in the bond markets through bond funds, funds of closed-end variant and unit-investment trusts.
To brush through Bond market often we come across Primary market, secondary market.
The Primary market deals with the issuance of new securities. Companies, governments or public sector institutions can obtain funds through bond issuance. The Secondary market refers to the stage where previously issued financial tools like stocks, securities, bonds, futures and options transactions take place. Dealers out here in this market are often referred to as Satellite Dealers and here new investors can purchase from other investors in the secondary market or the aftermarket.


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Pamela

HEDGE FUNDS

While there can be numerous ways & tools of investment,let us take a snap shot of one financial product which has strong presence but not with too much fan following and it is hedge funds.
Hedge fund is an investment type of unique approach and can be said as financial tool with diversified activities quite different from any other fund type as well as it is accessed by limited number of investors as per regulation.
Considered as class investment taking into account shares, debt instruments, commodities, and various asset classes into its portfolio, hedge fund have its orientation quite different from each other visible from their objectives hence adheres to with different methodology in approaching investment.
Why Hedge??
These funds often seek to pacify potential losses in the markets they invest in by hedging their investments using a variety of methods, most notably short selling. Over the period of time, however, though said that hedging reduces risk but itself the process of hedging
actually increases risk with expectation of capital appreciation.
Hedge funds meant for certain elite society and provides them with an exemption in many jurisdictions from regulations over short selling, leverage, fee structures derivative contracts, and the liquidity of interests in the fund.
Structure of Hedge Fund
A hedge fund is a tool of investing where money is pooled. Other than fund asset portfolio and cash money there is no other asset holding for the fund investment while its investors are its clients.
Talking about the service providers they are:-
Broker: Service provided against prime brokerage includes money lending, standing as counter party for derivatives, transaction of securities for short selling, clearance and settlement. Brokers popularly termed prime brokers acted as prime functionary as that of bank.
Administrator: They function mainly as operational back bone of the fund by processing
Purchase, redemption requests, issuance of interest, computing NAV.
Distributor - They are responsible for marketing the fund to potential investors and mobilization of cash fund for investment. Frequently this role is taken by the hedge fund manager.