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Showing posts with label Personal Finance. Show all posts
Showing posts with label Personal Finance. Show all posts
New Trend In Finance With Credit Friend
The most recent financial crisis, caused by low-quality sub-prime loans, has left people with no income, no jobs and no assets. Microfinance founder and founding member of Ashoka’s Global Academy Muhammad Yunus has strongly protested against the way microfinance has evolved—many microfinance institutions have become the same money sharks that Yunus initially sought to put out of business.
People are tired of paying high interest rates for credit cards, banks and payday loans. They’re tired of being classified with credit scores that do not necessarily represent their real credit capacity.
Enter Puddle
Puddle gives everyday people the opportunity to own a small virtual “bank” with their friends—no fees and no applications. Users decide on interest rates, who can be members, and who can borrow money. The best part: profits made from the interest rates paid by borrowers are distributed among group members.
Puddle is a response from three of social entrepreneurs that have challenged traditional microfinance and suspect lending practices for more than a decade: Ashoka Fellows Solomon Raydán, Jean Claude Rodriguez-Ferrera and Matt Flannery (Kiva co-founder and CEO).
Raydán, Rodriguez-Ferrera and Flannery are supporting the “self-financed movement,” inspired by ancient lending practices generically known as Rotating Savings and Credit Associations (ROSCAS). Community groups around the world, though very poor, have proven their capacity to organize and sustain their own savings and credit system without having to go through the formal banking system.
Puddle is bringing simplicity, convenience and transparency to a financial model that needs to be changed. It is not intended to replace formal banking. Puddle launched late last year and is expanding rapidly.
In Europe, much of the move offshore has been backed by the European Bank for Reconstruction and Development (EDRD). The International Finance Corporation (IFC) has a billion dollars invested in the wind sector, Sawyer said.
And the InterAmerican Development Bank has invested heavily in Central and South America, he added, especially in some of the smaller markets like Uruguay, Peru, Costa Rica, Nicaragua, Honduras and Panama.
“South Africa should be a big market,” Sawyer said. “It is a growing economy. They need the power. They need the jobs. And they want the investments.” The initial auction rounds account for about 3.5 gigawatts, and “if the industry starts to move, they will end up with a lot more than 10 gigawatts because they really need the power and they are actively encouraging investment from any and all quarters.”
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Investing George Soros' In Herbalife
The Soros investment means that in continuing his massive bet against Herbalife’s stock, Ackman’s Pershing Square hedge fund is on the opposite side of arguably the two greatest traders in the history of Wall Street. The other legend Ackman is up against in his Herbalife trade is the only guy on Wall Street who is richer than Soros. Carl Icahn, whose net worth is $20 billion, invented the investment strategy that Ackman now practices, now known as activist investing. Icahn owns 16.5% of Herbalife and has two representatives on the company’s board.
According to CNBC, Soros’ position in Herbalife is large enough to be one of his top three positions. Soros is involved in the managing of his money but the chief investment officer at Soros Fund Management is Scott Bessent, who handles the day-to-day operations. The forces of Ackman claim that the man responsible for Soros’ Herbalife investment is Paul Sohn. Nevertheless, Ackman is shorting 20 million shares of Herbalife, a $1 billion bet, because he thinks the company is a pyramid scheme that will collapse once people realize the fraud and regulators shut it down. The optics of the Soros investment in Herbalife get even worse for Ackman because his short investment thesis includes a strong moral component. Ackman has said he has a “moral obligation” to fight Herbalife, claiming the company takes advantage of low-income people and minority groups, and will give his personal profits from the short trade to charity.
Ackman’s lawyers have reportedly asked the Securities & Exchange Commission to investigate how Soros’ position in Herbalife was leaked to CNBC’s Scott Wapner, the star reporter who orchestrated Ackman’s televised verbal brawl with nemesis Carl Icahn in January by getting Icahn to make a surprise call during Ackman’s interview with Wapner. Ackman’s surrogates are suggesting that the leaking of Soros’ position potentially constituted improper market manipulation designed to create a short squeeze. Herbalife’s stock is now up by 100% in 2013 and continued to rise in Thursday morning trading. That means that the Pershing Square hedge fund’s Herbalife position has suffered estimated paper losses of some $650 million in 2013, given that Ackman has said he shorted 20 million shares and told CNBC on Wednesday that he has not covered a share.
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Ex-Goldmanite 'Hebat Fab' Tourre
Amid a broader crackdown on the securities industries, the Securities and Exchange Commission secured one of their most high profile victories on Thursday, as a jury in New York found former Goldman Sachs trader Fabrice Tourre liable of civil-fraud. Tourre is one of the most visible faces of Wall Streethubris during the financial crisis, having been found to mislead investors in a mortgage-backed securities deal that netted billionaire John Paulson’s hedge fund $1 billion just as the housing bubble was bursting.
The jury’s decision puts the focus on Tourre’s defense team, bankrolled by Goldman Sachs, which days ago chose not to call any witnesses to the stand in an apparent show of confidence.
The case was centered on Abacus 2007 AC1, a mortgage-backed security (MBS) that Goldman helped to build and Tourre sold, and hits at the core of what major Wall Street banks were doing in the buildup to the financial crisis.
Goldman Sachs then brought in financial firm ACA to work with Paulson in selecting the mortgages that made up the MBS.
Tourre then turned around and offered the security to clients, using language the jury found to be purposefully misleading, masking Paulson’s intention to short the security, and in some cases masking his involvement in the deal. Andrew Ceresney, co-director of the SEC’s enforcement division, said: “we are gratified by the jury’s verdict finding Mr. Tourre liable for fraud. Goldman Sachs had settled the case with the SEC for half a billion dollars in 2010, while Tourre chose to fight the charges.
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LinkedIn income climbed $ 363.7 M
SAN FRANCISCO (Reuters) - LinkedIn Corp (LNKD) reported revenue of $363.7 million in second quarter, a 59 per hundred jump, after its members numbers proceeded to soar after some quarters of slowing down development.
The San Francisco business, one of the few social newspapers stocks that have fulfilled its hype since going public, now brags 238 million users, a 37 per hundred boost from a year before.
LinkedIn shares, which shut at an all-time high of $213 on Thursday before the newest results, have roughly increase two-fold in the past year.
LinkedIn posted earnings per share of $0.38 on revenue of $363.7 million. Analysts expected 31 cents per share on revenue of $354 million. In the year-ago period, LinkedIn posted earnings per share of 16 cents on revenue of $228 million.
Premium subscriptions generated $73.0 million in the quarter, up 68% from the year-ago period and represented 20% of total revenue, up from 19% a year ago.
U.S. business was 62% of total revenue, while international was 38%.
Total LinkedIn users were 238 million, up 37% from the year-ago period, and the first sequential acceleration of growth since LinkedIn’s 2011 IPO. Monthly unique visitors were 189 million, including LinkedIn’s SlideShare unit. LinkedIn has beaten analysts’ expectations in every quarter as a public company since pricing its IPO at $45 per share in 2011.
(Reporting by Gerry Shih; revising by Bernard Orr)
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Young African Millionaire
It’s 1:15 pm on a blistering hot Wednesday afternoon in Dar Es Salaam. For a 28 year-old Tanzanian who has built an $8 million (revenues) solar energy company, Ngowi certainly looks the part. Ngowi has a remarkable story. He is the CEO ofHelvetic Solar Contractors – a Tanzanian company that supplies, installs and maintains solar systems throughout the northern circuit of Tanzania. The company sells everything solar from photovoltaic (a.k.a. “solar”) panels and water heaters to battery banks, generators and back-up units.
But what’s even more interesting is the fact that Ngowi has had success at such a young age. Ngowi got his first taste of business at 15 when as a high school student he started selling top-up vouchers. Mobile phone companies like Vodacom, Tigo and other had only just established operations in the country and the only place to find recharge vouchers were in the shopping malls and exclusive phone shops. There were very few distributors or super dealers in Arusha, a mid-sized commercial city that serves as the gateway to the northern circuit where Ngowi lives. Ngowi noticed that most people in his neighborhood who wanted to top-up their phones had to travel significant distances to buy airtime. Spotting opportunity, Ngowi raised Tsh 50,000 (about $50) from his mother and bought top-up vouchers from the big dealers. The mobile phone revolution was in its infant stages, and phones were still relatively expensive. It was during his frequent trips to Hong Kong and China that he discovered solar panels and learned about renewable energy for the first time.
Tanzania has critical energy infrastructural challenges. At the time of Ngowi’s frequent Asian trips, the national power grid coverage in Tanzania was only about 10%. Most companies, government agencies and wealthy families depended heavily on generators.
There was opportunity, and Ngowi wanted to delve right in, but his parents insisted that he completed his education. Ngowi comes from a family of academics. “Right from the time I started the Recharge voucher business, my mother told me that I had to complete my education. At 19, Ngowi had to abandon his business and carry on with his studies. He had already become fascinated with China and solar energy. With some of the money he had accumulated from his business, he enrolled at the Denzhou University in China where he studied renewable energy. While at Denzhou, Ngowi started an informal exporting business. At that time, there weren’t as many people making frequent trips to China as there are today, and as the word spread, many builders and traders in Arusha would send Ngowi money to purchase materials and other goods for them. By the time he had finished with his studies, Ngowi had built up enough capital. We marketed ourselves aggressively- marketing our products to schools, governments, hospitals and just about everyone else- convincing them to use our solar panels,” Ngowi explains.
Solar was a relatively new energy source to the vast majority of Tanzanians and so business was not moving as rapidly as he had hoped.
Ngowi kept marketing his business, sending proposals to everyone he could think of. With time, and as the media championed the cause for alternative energy sources, business began to pick up for Ngowi.
His company, Helvetic Solar was the only company based in Arusha offering solar products. “Whoever needed solar in Arusha had to come to us. Business picked up tremendously for Ngowi from 2007. As his company installed solar panels and related products for smaller clients, the word spread across to contacts everywhere. Soon, government agencies, Non-Governmental Organizations and multinational corporations started asking Helvetic Solar to provide them with solar products.
Ngowi is expanding outside Tanzania. Helvetic now supplies solar to a number of government institutions in Rwanda. So it’s easy for us to get awarded contracts,” Ngowi explains.
While Ngowi has made a small fortune in renewable energy contracting –an estimated $5 million, he is reinvesting his fortune in real estate and tourism. KPMG East Africa named Helvetic Solar Contractors the Fastest Growing and Number One Company in a survey of the Top 100 Mid Sized Companies in Tanzania for the year 2012 – 2013. Ngowi was recently nominated for Africa’s Young Person of the Year award by The Future Awards – a popular annual award that has been referred to as the ‘Nobel prize for young Africans’.
Ngowi laments the difficulty in accessing funding as the biggest challenge in doing business in Tanzania.
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Is Investment Management
For most people who invest through 401k accounts at work, investment management takes the form of mutual funds. Behind any active mutual fund there is a lead investment manager and, often, a team of support managers. They pick the stocks or bonds that make up the fund.
Balancing risk
Since the combination of funds is crucial, many 401k plans try to offer their members a “set it and forget it” option for investment management, often in the form of target-date funds or pre-cut portfolios. In the latter, the measure of stock vs. bond funds is designed to match your age and ability to accept risk.
The idea is to completely automate the investment management process.
Each underlying investment fund has its own fees, in order to pay the managers doing the trading. Target-date funds have costs, too. Fund fees cost you real money, and that affects your performance dramatically over time.
Pension plan ideal
The ideal investment management plan would combine very low costs with an appropriate portfolio mix for the age and time horizon of each investor. Increasingly, the major brokerages offer exchange-traded funds (ETFs) with minimal fees and, often, no commission charges. If you don’t have access to a pension manager but do have the ability to pick your own investments, then the challenge is building that mix of investment types yourself while keeping costs low.
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