Archive for September 23rd, 2010

Ending the Bush Tax Cuts will hurt small businesses … so, outboard them.

September 23, 2010

This week, a series of ‘angles’ on the debate to kill or keep the Bush Tax Cuts …

Again, I’m for extending all of the Bush Tax Cuts, and I don’t like helping the Dems with their messaging.  But …

The GOP’s constant sound bite is that that letting any of the Bush Tax Cuts expire would hurt investors and small businesses.

The Dems say that only 3% of all small businesses report Schedule C business income on their 1040s.

The GOP counters that the 3% accounts for 43% all small business income.

 The Tax Policy Center estimates that higher business taxes would affect 725,000 returns with about $400 billion of business income. Some of these are partnerships of doctors, lawyers and accountants. Others are contractors, restaurant owners, florists and plumbers.

http://www.realclearpolitics.com/articles/2010/09/20/the_economic_blame_game_107220.html

Score the point for the GOP.

So, why don’t the Obamatrons just cap Schedule C  income at, say, 25%.

That would take that issue off the table.

And, before you say ‘would be too complicated’ … remember that typical 1040s treat ordinary income, dividends, and capital gains at different rates already.

Posted in Taxes | 2 Comments »

Jersey Boys pulls professor out of Five-O funk …

September 23, 2010

I’ve been slowed all week by my lingering disappointment over the Hawaii Five-O premiere — which, incidentally, drew almost 14 million viewers.

I’m pleased to report a bounceback.  Trekked into NYC yesterday to finally see Jersey Boys.  Man, was it good — nice storyline and great oldies.  The 2-1/2 hours flew by.

If you haven’t seen it, you should — even if you’re too young to know who the Four Seasons are.

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Predictive analysis: the way of the future

September 23, 2010

TakeAway: The tools available to marketers to help determine the best course of action for specific customers are becoming more powerful. 

While the Excel spreadsheet is the typical tool of choice to help make decisions, IBM has a comprehensive suite of tools that focuses on predictive analysis. 

By better understanding individual customer’s needs, these tools can help deliver more targeted promotions that result in an increased ROI.

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Excerpted from Brandchannel, “How Marketers Use Predictive Analysis to Target Their Branding Efforts,” by Barry Silverstein, August 5, 2010

Brand marketers know they must leverage the power of social media, but they face a dilemma: How do they truly measure social media’s effectiveness? This leads to an even larger issue: Given the use of multiple media in an integrated way, how do marketers understand what media combination is really working?

To answer those questions, more brand marketers are turning to predictive analysis …

Brandchannel had the … opportunity to discuss the topic with Dr. Michael Haydock, global analytics leader for IBM’s Business Analytics & Optimization Practice. …

Interestingly … even chief marketing officers responsible for budgets of $1 billion or more typically use only spreadsheets to analyze their expenditures. That’s fine for looking at past programs and what’s happening now – but it gets far more difficult when these executives must make smarter decisions; specifically, determining how to make their marketing investment work harder going forward.

That takes analysis, and a lot of it. Haydock’s … approach is to break a client’s customer file into clusters based on what he calls “feature vectors” … These … are used to describe customer behavior and predict what customers might do next. … each customer is scored for his or her propensity to buy …

When it comes to social media … most brand marketing organizations still view social media and traditional media separately, … predictive analysis can draw a connection between the two. For example, if a customer sees a television ad and then uses a smartphone to visit a website, it’s important to look at that customer contact cycle and understand the ROI of the total program.

A particularly intriguing application of predictive analysis is something IBM calls the “Next Best Action Program.” Haydock says the program offers marketers the ability to analyze the customer touches made through any channel and then establish a relevant “conversation” …

In essence, the program literally determines the next best action to take with every customer on an individualized basis. …

Ultimately, the value of predictive analysis to marketers is getting an intimate understanding of each customer’s needs, and delivering more relevant promotions that are better targeted. The end result: a superior ROI on the company’s marketing investment.

 

 

 

Edit by DMG

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Full Article
http://www.brandchannel.com/features_effect.asp?pf_id=510

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For the next cocktail party: Some (sad) housing factoids …

September 23, 2010

According to the WSJ …

  • New home sales, pending home sales, and mortgage applications are down to a 13-year low
  • New home prices have fallen by an average of 30%, reducing home occupancy cost to 15% of family incomes, down from the conventional 25%.
  • About 11 million residential properties have mortgage balances that exceed the home’s value.
  • The total inventory of homes and the shadow inventory of 3.7 million empty (foreclosed) homes.
  • Eight million home loans are in some state of delinquency, default or foreclosure.
  • Another eight million homeowners are estimated to have mortgages representing 95% or more of the value of their homes, leaving them with 5% or less equity in their homes and thus vulnerable to further price declines.
  • If prices fall another 5% to 10%, an estimated 40% of American homeowners with mortgages in excess of the value of their homes.
  • Under the Home Affordable Modification Program, half of the borrowers have been redefaulting within 12 months, even after monthly payments were cut by as much as 50%.
  • A well-balanced housing market has a supply of about five to six months. These days the inventory backlog has surged to about a 12½ months’ supply. This explains why average sale prices have been declining for so many months. The high end of the market, in particular, is under great pressure.
  • Household formation (marriages) is also shrinking now, down to an annual rate of about 600,000, compared to net household formation in excess of a million annually during the bubble years.
  • $6 trillion of home equity value has disappeared, a loss that has had a devastating effect on consumer confidence, retirement savings and current spending.
  • Every 1% decline in home prices today lowers household wealth by approximately $170 billion …  and, each dollar lost in housing wealth lowers consumption by 5 cents.
  • A million-plus fewer homes are being built on on an annual basis from the peak years of the housing boom … with five people or more working on each home, we have permanently lost over five million jobs in residential construction.

Source: WSJ: The Recession and the Housing Drag, Sept 21, 2010 
http://online.wsj.com/article/SB10001424052748703989304575503752698078816.html?mod=WSJ_Opinion_LEADTop

Posted in Housing - Mortgages | Leave a Comment »