How the high gas prices are helping me save money

May 26th, 2008 Dividend Pirate Posted in Economy, General, Saving Money 5 Comments »

Like the rest of the country, we are also being hit hard by the high gas prices. Gas has crossed 4 dollars a gallon(ouch!!! I remember filling a tank at 1.81 dollars a gallon three years back). We have 2 cars and my wife and I drive 40 miles each daily. On an average our gas expenses were coming to 250 dollars per month(plus other related expenses due to driving like maintenance, etc…). So due to the spiraling costs, we decided to start taking the bus to work.

In Seattle, we have the concept of a “Park and Ride“. You drive your car to the Park and Ride, park your car and take the bus from there(pretty cool concept right). The Park and Ride is at a 4 minute driving distance from my place. In general Seattle’s public transportation is so much better than Los Angeles. In Los Angeles the big automotive companies never allowed the public transportation to gain good ground. Seattle’s is way better. In Seattle downtown, during the day public transportation is completely free. Riding the public transportation for me is free anyways because my company provides me with a free bus pass. Having ridden the bus for a week, I prefer riding the bus than taking a car because

- it helps me save money. If I save 250 dollars a month and invest it at 10% a year then in 30 years I should have 565,121.98 $$ saved. :) Now that’s quite a lot of money. You see the power of compounding. :) Try my savings and other calculators at http://dividendpirate.com/financial-calculators/

- gives me time to read a book.

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Squanderville versus Thriftville

March 28th, 2008 Dividend Pirate Posted in Economy No Comments »

Warren Buffett’s excellent 2003 article in Fortune, Squanderville versus Thriftville http://www.tradereform.org/content/view/731/52/

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Popularity: 4% [?]

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US killing the dollar

February 2nd, 2008 Dividend Pirate Posted in Economy 2 Comments »

The Fed cut interest rates by 1.25% to save the economy from regression. By cutting rates they are again artificially generating money out of thin air and whenever they do that you are basically debasing the dollar. Below I am pasting excerpts from an article on “US killing the dollar” I read on rediff.com,

“What could surprise many is the fact that the US Fed’s prescription to reduce interest rates, ostensibly to tackle the prospect of a recession might well turn out to be its Waterloo. Put bluntly, the US faces as much of a risk of a recession after this rate cut as it did before.

Breather for (sub-prime) borrowers?

Ostensibly this cut is aimed at alleviating the worst housing recession in the US since 1991 and ease the pressure on the economy. The situation is so appalling that some US lawmakers had even called for cheaper borrowing costs for the benefit of the average Americans.

And this cut is aimed at providing succor to all those stakeholders — borrowers and lenders — who were party to this credit extravaganza for the past several years. It may be noted that it is this credit expansion in the US that acted as a de-facto compressor for the above mentioned engine of global economic growth.

And it is not a problem that pertains only to sub-prime borrowers, as is commonly believed. As many credit card, car and consumer loans too are beginning to turn bad, the US financial sector is facing a crisis of an unprecedented magnitude.

Consequently, with many banks and financial institutions facing prospects of going belly up, the Fed had no other option but to cut interest rates. For, if it hadn’t effected a rate-cut, it would have triggered a severe crisis within the US financial sector over the next few months and might have led to the collapse of many financial institutions.

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