Lesson #1 and #2

Lesson #1 - Why the U.S. was downgraded:


• U.S. Tax revenue: $2,170,000,000,000

• Fed budget: $3,820,000,000,000

• New debt: $ 1,650,000,000,000

• National debt: $14,271,000,000,000

• Recent budget cuts: $ 38,500,000,000



Let's now remove 8 zeros and pretend it's a household budget:

• Annual family income: $21,700

• Money the family spent: $38,200

• New debt on the credit card: $16,500

• Outstanding balance on the credit card: $142,710

• Total budget cuts: $385

Got it?



Lesson #2 - Here's another way to look at the Debt Ceiling:



Let's say, You come home from work and find there has been a

sewer backup in your neighborhood....and your home has

sewage all the way up to your ceilings.


What do you think you should do?

1. Raise the Ceilings, or

2. Pump out the sewage

Think about it....

Library of Congress to receive entire Twitter archive

Wednesday - 12/7/2011, 12:34am ET

Bill Lefurgy, digital initiatives program manager, Library of Congress

The Library of Congress and Twitter have signed an agreement that will see an archive of every public Tweet ever sent handed over to the library's repository of historical documents.

"We have an agreement with Twitter where they have a bunch of servers with their historic archive of tweets, everything that was sent out and declared to be public," said Bill Lefurgy, the digital initiatives program manager at the library's national digital information infrastructure and preservation program. The archives don't contain tweets that users have protected, but everything else — billions and billions of tweets — are there.

Lefurgy joined the Federal Drive with Tom Temin and Amy Morris Tuesday morning to talk about the library's digital mission.

Using new technical processes it has developed, Twitter is moving a large quantity of electronic data from one electronic source to another. "They've had to do some pretty nifty experimentation and invention to develop the tools and a process to be able to move all of that data over to us," Lefurgy said.

The Library of Congress has long been the repository of important, historical documents and the Twitter library, as a whole, is something historic in itself.

"We were excited to be involved with acquiring the Twitter archives because it's a unique record of our time," Lefurgy said. "It's also a unique way of communication. It's not so much that people are going to be interested in what you or I had for lunch, which some people like to say on Twitter."

Researchers will be able to look at the Twitter archive as a complete set of data, which they could then data-mine for interesting information.

"There have been studies involved with what are the moods of the public at various times of the day in reaction to certain kinds of news events," Lefurgy said. "There's all these interesting kinds of mixing and matching that can be done using the tweets as a big set of data."

One benefit for the Library of Congress in receiving this large data set is that it's been forced to stretch itself technologically.

"It's been difficult at times," Lefurgy said. "But we firmly believe that we have to do this kind of thing because we anticipate that we'll be bringing in large data sets again into the future. We don't know specifically what, but certainly there's no sign of data getting smaller or less complicated or less interesting."

The library's Twitter partnership comes amid a renewed push by the administration and the National Archives and Records Administration for federal agencies to better archive their own social media postings and emails as potential government records.

"We're basically in the same situation as the National Archives, only on a much larger scale," Lefurgy said. "We tend to have a much larger perspective in terms of what we collect."

Federal Radio

Borrowers set to receive money under RBS settlement will be notified

RBS Financial Products Inc., a subsidiary of the Royal Bank of Scotland formerly known as Greenwich Capital Financial Products Inc., will pay $52 million to settle allegations that it securitized "presumptively unfair" residential mortgages, state Attorney General Martha Coakley said today.

The settlement is part of an ongoing investigation into the financing, purchase and securitization of what Coakley calls "unfair" home loans.

Of the $52 million due from RBS, $40.2 million will be used for principal reduction for more than 700 Massachusetts subprime borrowers, Coakley's office said. The loans, primarily ARMs, were securitized by RBS in 2006 and 2007 and feature high debt-to-income and loan-to-value ratios.

Nearly $9 million will be paid to the commonwealth and more than $2.6 million will be used to compensate entities, including municipalities, that are "acutely affected by foreclosures of the RBS securitized loans," Coakley's office said.

Last year, Coakley won a $102 million settlement from Morgan Stanley. In 2009, Goldman Sachs paid $60 million in a similar case.

Borrowers set to receive money under the RBS settlement will be notified by Coakley's office.

By Matt Brown

Housing Wins Higher FHA Mortgage Limits

The U.S. housing industry has scored a victory with House and Senate votes to raise the size of mortgages backed by the Federal Housing Administration to $729,750.

The measure split Republicans, many of whom supported retaining the lower limit of $625,500. As a result, efforts to restore the higher limit fell short until the Senate attached an increase to a package of spending bills that were passed yesterday by both the House and Senate.

The higher FHA limit is expected to become law after the president signs the spending measures, which he must do by the end of today to avoid a government shutdown.

“Restoring the higher loan limits for the FHA will provide homeowners and homebuyers with safe and affordable financing, while providing a much-needed boost to housing markets all around the country,” James W. Tobin, chief lobbyist for the National Association of Home Builders, wrote in a Nov. 16 letter to Speaker John Boehner, an Ohio Republican.

Lawmakers who backed higher limits said withdrawing federal support could further undermine a housing market still struggling to recover from the 2008 credit crisis.

The final compromise, which dropped a similar increase to loans backed by mortgage firms Fannie Mae and Freddie Mac, represents a mixed victory for the housing industry.

While the increase to $729,750 is expected to spur some additional homebuying, it’s not clear by how much. FHA loans make up a smaller share of the market than those purchased by Fannie Mae and Freddie Mac.

5.3 Million Homes

Still, the measure was fully embraced by trade groups for homebuilders and realtors. The National Association of Homebuilders has estimated that 5.3 million homes lost their eligibility for conforming loans when the higher limits expired on Oct. 1. Nearly 670 counties saw their loan limits decline, according to the National Association of Realtors.

On the other side were a number of interest groups that push for free-market policies and against government support to the housing market. Those groups, which include the Club for Growth and Heritage Action for America, play a large role in the House Republican conference and can influence campaign funding for the next election.

Republicans backed by the groups thought efforts to increase the loan limits had been defeated earlier this year, particularly when the White House announced support for allowing them to go back down to pre-crisis levels.

‘Completely Bizarre’

“This is completely bizarre that the Congress would be to the left of this president on housing finance,” Representative Patrick McHenry, a North Carolina Republican on the House Financial Services Committee, said in an interview.

House Republicans who opposed the provision seized on the FHA’s annual actuarial report released earlier this week, which said the agency has a 50 percent chance of needing to seek taxpayer aid to bolster its insurance fund.

The FHA, which provides liquidity by protecting lenders against borrower defaults, has increased its share of the mortgage market in the wake of the credit crisis. The agency, created in 1934 during the Great Depression, now guarantees a third of U.S. mortgages, according to the report.

The House-passed legislation, approved in a 298-121 vote, was opposed by 101 members of the House’s Republican majority, some of whom said they opposed the measure primarily because of the loan-limit increase.

Representative John Campbell, a California Republican who pushed for the increase, called the compromise on the provision “just a bad deal.” Campbell said he would have preferred that lawmakers boost the limit for Fannie Mae and Freddie Mac over raising the FHA limit.

‘Short-Term Fix’

“I’m glad something got done, but because they got it backwards, this will be a much more short-term fix than I would have hoped,” Campbell said in an interview.

=The Senate followed the House’s lead a few hours later, voting 70-30 to clear the measure for Obama’s signature. The provision was once again cited by several Republicans as a reason for their opposition.

“Raising the loan limits at FHA only, an unprecedented move, will simply drive more business into Ginnie Mae securities and put the FHA at even greater risk of losses to taxpayers,” Senator Bob Corker, a Tennessee Republican, said yesterday. “If we cannot even take this simple step, we risk crowding out the private sector for years to come.”

To contact the reporter on this story: Phil Mattingly in Washington at pmattingly@bloomberg.net.



To contact the editor responsible for this story: Lawrence Roberts at lroberts13@bloomberg.net

15 Ways to Prepare Your Home for Winter

Convert to Gas

Nothing communicates home-loving coziness like a fire in the fireplace. Unfortunately, traditional woodburning fireplaces tend to lose more energy than they produce, pulling heated air out of the house and sending it up the chimney (and burning wood adds to air pollution). If you have natural gas or propane heating, consider having gas logs installed. A direct-vent system is best for new, air-tight homes; it pulls in air from outdoors, pushes it past the firebox, and sends the warmed air into the room. Vent-free systems require no chimney, flue, or outside exhaust. They're relatively inexpensive to operate, warm the room efficiently, and meet national standards for indoor air quality.

Call the Chimney Sweep

If gas logs aren't in your budget and you use your woodburning fireplace often during the winter, have it cleaned and inspected before winter. Burning wood releases volatile gases that cool and condense on the inside of the chimney, forming sticky, smelly, highly flammable creosote. Allow enough of it to build up, and you run a risk of a chimney fire. Also make sure the damper is working properly and that the chimney is capped with screening to keep out critters

Put the Ceiling Fan in Reverse

Check your ceiling fan for a switch that allows you to reverse the direction of blade movement to turn clockwise instead of counter-clockwise. Warm air rises, and the clockwise rotation of the blades forces the warm air down to where people benefit from it.

Wash the Windows

Yes, it's a tedious job, but washing the windows inside and out twice a year--spring and fall--rewards you with sparkling views, unobstructed light, and the opportunity to check for cracks and damaged caulking. Use a commercial window cleaner or make your own by mixing 1/4 cup of white vinegar with 1 gallon of water. Newspaper makes the best "cleaning rag" because it's absorbent and won't leave lint, but wear gloves to protect your hands from the newsprint.

Rearrange the Furniture

Changing the furniture arrangement is an easy way to give your rooms a new look and feel for the winter. Pull seating pieces close to the fireplace to create a cozier mood, and bring out soft chenille or fleece throws to ward off the chill. Set up a new display on the mantel to create a wintertime focal point--dark colors and layers of objects supply rich texture that adds increases the cozy factor. Some homeowners keep two sets of slipcovers, white for summer and a dark, warm color for winter.


Make Windows Airtight

According to the U.S. Department of Energy, 10 percent of the air that leaks out of a house exits through the windows. Caulk around window frames and apply weatherstripping between the sash and window frame to eliminate air leakage. Tension seal and magnetic types of weatherstripping are durable and effective for double-hung windows. For casement and sliding windows, apply self-adhesive V-strip weatherstripping to the side of a clean, dry sash or window jamb. Measure the length you need, cut the V-strip to fit, then peel off the paper backing while pressing the strip in place.


Put Up Storm Windows

Install storm windows to reduce air leakage year-round. You can find storm windows with vinyl, wood, or aluminum frames and glass or plastic panes. Glass is heavier but longer lasting and clearer than plastic, which scratches easily and yellows over time. Interior storm windows are generally mounted inside the window jambs or flush with the molding. They're easy to install but must be removed when you want to open the windows to let in fresh air. An exterior double-track or triple-track storm window is permanently installed on the outside of the window, and the lower half of the window moves in a separate track from the screen so you can lower or raise it to control air flow.


Clean the Gutters

Whether your gutters have become roofline planters like this one or have simply accumulated a season's worth of fallen leaves, get them cleaned out before winter rains and snows arrive. After scooping out leaves and debris, flush the gutters and downspouts with a strong stream of water from a hose. Make sure the gutters fit snugly against the house and repair any cracks or damage. Many companies offer leaf guards that claim to prevent leaves from collecting in the gutters, but most don't keep out dirt, debris, and seeds, so you'll still have to flush them out.


Check Smoke Alarms and Carbon Monoxide Detectors

Experts recommend replacing the batteries in smoke alarms twice a year, and if your smoke alarm is between 5 and 10 years old, replace it with a new one. There should be at least one smoke alarm on every level of your house and one in or near each bedroom. Safety experts recommend similar placement for carbon monoxide detectors--high on the wall, one on every level of the home, and near bedrooms. Where NOT to put them: within 15 feet of gas appliances, furnace, or fireplace because these give off small amounts of carbon monoxide when they're first turned on and would trigger false alarms.


An Easy Fix

Even though only 2 percent of air leakage is through electrical outlets and switchplates, every little bit counts, and insulating outlets is easy and inexpensive. Check a hardware store for outlet gaskets (also called insulation gaskets). To install them, turn off the electricity, remove the faceplate, pop out the perforated gasket, and press it over the outlet. Screw the faceplate back on, and you're ready to power back up. Look for UL-listed gaskets made from fire-retardant foam.

Have the Furnace Inspected

Call an HVAC professional to check the fan belt that runs the blower, vacuum out dust and debris, and oil the bearings if necessary. Buy enough filters to see you through the winter months and change them monthly--when filters become clogged with dust, the furnace doesn't operate efficiently and your energy bill goes up. Set the thermostat at 68 to save on energy costs, and consider replacing a manually controlled thermostat with a programmable one. This allows you to set the temperature at a comfortable level when you're in the house and cut it back to a cooler level when you're at work. Used properly, programmable thermostats can save up to $180 a year on heating and cooling costs.


Time to Go Tankless?

Conventional storage water heaters use energy to keep the tank full of hot water at all times; a tankless heater provides hot water only when you need it, which requires less energy thus saving you money. Whole-house tankless heaters are probably not cost effective for most homeowners--they cost more upfront than storage water heaters, and installation costs are also much higher and more complicated. Point-of-use heaters, however, are small and installed where you use them--at the kitchen sink or in the bathroom--and because they only need to furnish enough hot water for fixtures in that area, they can be efficient, cost-effective, and green. Gas-fired models deliver hot water at a faster rate than electrical models, which require upgraded wiring if they have to do much more than supply hot water to a bathroom sink.


Plug Hidden Leaks

About 30 percent of the cold air that leaks into your home comes through holes where pipes, vents, or electrical conduits run through the walls, ceiling, and floors. Check under sinks in the kitchen and bathroom and in the basement for gaps around pipes, and fill them in with an insulating foam sealant. Small gaps can be effectively sealed with caulk.

Protect Pipes from Freezing

To minimize the possibility of water freezing in your plumbing pipes causing them to burst, wrap each pipe in a blanket of foam insulation. Check hardware stores for these foam tubes, which have a slit on one side. Just cut the tube to the length you need, pull the slit open, and push the tube onto the pipe. If the slit doesn't have self-adhesive edges, use duct tape to secure it.


Add Insulation

Check the attic to see whether you need to add insulation -- experts recommend a depth of about 12 inches. Ultra Touch from Bonded Logic is an eco-friendly, formaldehyde-free insulation made from the scraps and waste left over from the manufacture of blue jeans. It's treated with a boron-based solution to prevent mold and mildew growth, discourage pests, and retard fire, and it won't irritate your skin during installation. Visit bondedlogic.com to find a retailer near you.

Better Homes  http://www.bhg.com/

Faulty Foreclosures Can Strip Property Rights From New Owners

The Massachusetts Supreme Judicial Court ruled today that if an original foreclosure was faulty, people who buy foreclosed property might not own what they think they do.

The case, Bevilacqua vs. Rodriguez, involved a Haverhill property which had been owned by Pablo Rodriguez, who took a mortgage on it in 2005 through a lender named Finance America. The mortgage was assigned to the Mortgage Electronic Registration System (MERS), and the note was subsequently sold into a securitized trust.

In 2006, U.S. Bank, acting as trustee, foreclosed on the property. But the mortgage, which had been entered into the land records as assigned to MERS had never been transferred over to U.S. Bank. This transfer occurred only after the foreclosure sale had already been completed.

Last year, the SJC ruled in its influential Ibanez decision that such post-foreclosure transfers were illegal - banks must be assigned the mortgage prior to foreclosure in order to foreclose.

In 2006, U.S. Bank sold the property to Francis J. Bevilacqua, granting him a "quitclaim deed" affirming U.S. Bank no longer had an interest in the property. But, given the court's Ibanez ruling, in 2010 Bevilacqua elected to file a "try title" action in order to clear up any potential problems with the title.

A "try title" action is a legal method of clearing disputes over who owns a piece of property by forcing the parties with a claim on the land to appear in court and present evidence. If a party with such a claim fails to appear and defend it, or loses the case on the evidence, their claim is wiped out, making it easier for the current owner to sell.

Judge Keith Long of the Land Court, however, ruled that Bevilacqua didn't have the right to attempt to "try title." Since U.S. Bank's original foreclosure was illegal, they didn't have the right to sell the property to Bevilacqua in the first place, and he was not its legal owner.

The SJC today affirmed that decision, saying that the fact that U.S. Bank had granted a deed to Bevilacqua wasn't enough to establish his ownership.

"Recording may be necessary to place the world on notice of certain transactions. Recording is not sufficient in and of itself, however, to render an invalid document legally significant," said the court. "In light of its defective title, the intention of U.S. Bank to transfer the property to Bevilacqua is irrelevant and he cannot have become the owner of the property pursuant to the quitclaim deed."

The court does state that it might be possible for property owners in Bevilacqua's position to establish ownership by, in effect, re-foreclosing on the property.

Bevilacqua might argue that the record shows that U.S. Bank intended to transfer its interest in the property to him, and that therefore he is entitled to foreclose on the property under the terms of the original mortgage, just as U.S. Bank would have been.

However, the court says that a try title action isn't the proper legal proceeding in which to attempt such a maneuver. But they explictly leave the door open for Bevilacqua to make another attempt to establish his ownership.

By Coleen Sullivan

North Shore Massachusetts Flood

Dealing with the Aftermath


If you have experienced a flood, you can file your flood insurance claim by following these three steps:

STEP ONE:

After experiencing a flood, contact your agent or insurance company to file a claim. An adjuster should contact you within a few days of filing your claim. If you do not hear from an adjuster, you can contact your insurance agent or company again. Make sure you have the following information handy:

•The name of your insurance company

•Your policy number

•A telephone and/or email address where you can be reached at all times

STEP TWO:

Separate damaged from undamaged property. Your adjuster will need evidence of the damage to your home and possessions to prepare your repair estimate.

•Take photographs of all of the damaged property, including discarded objects, structural damage, and standing floodwater levels.

•Make a list of damaged or lost items and include their date of purchase, value, and receipts, if possible.
•Officials may require disposal of damaged items so, if possible, place flooded items outside of the home.

STEP THREE:

Your adjuster will provide you a Proof of Loss form for your official claim for damages. You'll need to file this claim with your insurance company within 60 days of the flood. This document substantiates the insurance claim and is required before the National Flood Insurance Program (NFIP) or insurance company can make payment.

You'll receive your claim payment after you and the insurer agree on the amount of damages and the insurer has your complete, accurate, and signed Proof of Loss form. If major catastrophic flooding occurs, it may take longer to process claims and make payments because of the sheer number of claims submitted.

Disaster Assistance: (800) 621-FEMA, TTY (800) 462-7585


http://www.floodsmart.gov/floodsmart/