Do not use Safety Deposit Boxes

I have not fully vetted this story but I believe it’s true. If so we should all be emptying our safe deposit boxes pronto.-Lou



According to in-house memos now circulating, the DHS has issued orders to banks across America which announce to them that “under the Patriot Act” the DHS has the absolute right to seize, without any warrant whatsoever, any and all customer bank accounts, to make “periodic and unannounced” visits to any bank to open and inspect the contents of “selected safe deposit boxes.”

Further, the DHS “shall, at the discretion of the agent supervising the search, remove, photograph or seize as evidence” any of the following items “bar gold, gold coins, firearms of any kind unless manufactured prior to 1878, documents such as passports or foreign bank account records, pornography or any material that, in the opinion of the agent, shall be deemed of to be of a contraband nature.”

DHS memos also state that banks are informed that any bank employee, on any level, that releases “improper” “classified DHS Security information” to any member of the public, to include the customers whose boxes have been clandestinely opened and inspected and “any other party, to include members of the media” and further “that the posting of any such information on the internet will be grounds for the immediate termination of the said employee or employees and their prosecution under the Patriot Act.” Safety deposit box holders and depositors are not given advanced notice when failed banks shut their doors.

If people have their emergency money in a safe deposit box or an account in a bank that closes, they will not be allowed into the bank to get it out. They can knock on the door and beg to get in but the sheriff’s department or whoever is handling the closure will simply say “no” because they are just following orders.

Deposit box and account holders are not warned of the hazards of banking when they sign up. It is not until they need to get their cash or valuables out in a hurry that they find themselves in trouble.

Rules governing access to safe deposit boxes and money held in accounts are written into the charter of each bank. The charter is the statement of policy under which the bank is allowed by the government to do business. These rules are subject to change at any time by faceless bureaucrats who are answerable to no one. They can be changed without notice, without the agreement of the people, and against their will. People can complain but no one will care because this is small potatoes compared to the complaints that will be voiced when the executive order that governs national emergencies is enforced.

That order allows the suspension of habeas corpus and all rights guaranteed under the Bill of Rights.

A look at the fine print of the contract signed when a safety deposit box is opened reveals that in essence the signer has given to the bank whatever property he has put into that deposit box. When times are good people will be allowed open access to their safe deposit box and the property that is in it. This also applies to their bank accounts.

But when times get really bad, many may find that the funds they have placed on deposit and the property they thought was secured in the safe deposit box now belong to the bank, not to them. Although this was probably not explained to them when they signed their signature card, this is what they were agreeing to.


Five Banks Under Cyber Attack

I would not keep any significant money in large banks. Why not keep your money in local community banks or credit union? If you do have money in any of these five banks change your password immediately.-Lou

Watch Video HERE

JPMorgan Chase & Co is investigating a possible cyber attack and working with law enforcement authorities to determine the scope, a company spokeswoman said on Thursday morning. The bank was taking additional steps to safeguard sensitive or confidential information, though it did not see unusual fraud activity at this time, company spokeswoman Trish Wexler said. JPMorgan disclosed the investigation after the FBI said Wednesday evening it was investigating media reports earlier in the day that several U.S. financial companies have been victims of recent cyber attacks. “We are working with the United States Secret Service to determine the scope of recently reported cyber attacks against several American financial institutions,” FBI spokesman Joshua Campbell said in a statement late Wednesday. Campbell did not name any companies or give more details, although media reports had named JPMorgan as one victim of the attacks. Other potential victims have yet to be named. Officials with the Secret Service could not be reached for comment.

Your Financial Psychology Determines Your Financial Success

Here is today’s article at Physicians Money Digest.-Lou



Your Financial Psychology Determines Your Financial Success

Louis G. Scatigna | Wednesday, August 27, 2014
Nothing makes people crazier than money: not love, politics, sex, or religion. The smartest, most levelheaded people can suddenly become totally irrational when money is involved. For example, when it comes time to pay the check, the wealthiest, most extravagant people may calculate their shares down to the last penny.Our financial psychology determines how we deal with money. It’s important to understand this about ourselves because it will provide greater insights into why we handle our money as we do. People tend to make more financial mistakes as a result of their feelings about money than they do because of the financial realities involved.Diagnosis
Essentially, we all fall into one of 2 basic financial psychologies. We may be mild or extreme cases, but we all tend to fit in one of the following categories. They are:

Attitude of abundance
Believing that we have or will always get whatever we need to live a good life and to support our families and ourselves. Those who have an attitude of abundance feel that the world is filled with opportunities and possibilities.I have clients who have little money and don’t seem concerned. They never complain about finances, live comfortable lives, take frequent vacations and are generous. They seem to feel that everything will be fine and that somehow they’ll get whatever they need.Attitude of lack
Believing that you may not have or be able to get whatever you need. I also have clients who are millionaires and have an attitude of lack. They’re always concerned that they won’t have enough.

Many of them are tightwads, compulsive savers who are always worried that they may lose what they have. Most of these people grew up in difficult financial conditions that left a lasting impression they can’t shake.

The way we relate to money has more to do with our attitude about life in general than how much money we have. Our feelings of abundance or lack do not correlate to how much we actually have, but our financial state of mind.

So what are the symptoms of each financial psychology?

Those in the abundance camp tend to invest rather than save. They are not always looking for guaranteed or safe investments and are more prone to taking risks. They feel that if they lose money, they can always make it back. People with an attitude of abundance usually live better lifestyles and fuller lives. They are not averse to spending their money to buy the good things life has to offer and don’t waste much time worrying about the stock market, their mortgages and money in general.

Conversely, people with an attitude of lack are always worried that they won’t have enough. Deep down, they’re afraid that they might have to struggle so they sock money away to make it through those difficult times. People with an attitude of lack tend to be savers rather than investors. They would be devastated if they lost any money since they only have a finite amount. They like to stockpile their money and avoid risk, so they put their money in the lowest yielding, but safest vehicles.

The groundwork for our attitudes toward money is laid in childhood. We are strongly influenced by our parents’ attitudes and their fears, as well as our family’s financial status. “Depression Era” children, whose parents struggled to put food on the table, naturally have different attitudes toward money than children who grew up in affluent environments.

Many of us have also been influenced by how we saw our friends, family, and neighbors deal with money. We wanted what they had and wanted to live like they did, so we adopted their attitudes and tried to copy their behavior. They became our role models.

Unfortunately, many people sabotage their financial futures. Spendaholics, who get a rush from spending money, feel better when they do so. In some extreme cases, the only time certain people feel good is when they’re spending. -


Food Prices Rising Dramatically.

I went to buy a frozen 2 lb bag of shrimp and was startled to find it cost $39 ($17.00 lb). Want a steak and you will have to tap that line of credit.-Lou

Listen To This Week’s Radio Show (8/22/14)

This week’s radio show is now available.-Lou Listen Here 120809_radio_mic_istock_photo_328

Website Tracks Social Security Benefits

Website Tracks Social Security Benefits


A lot of Americans are counting on Social Security benefits when they retire, but many don’t know how much they can expect to receive.

U.S Treasury Facility Prints Social Security Checks
William Thomas Cain, Getty Images

But that’s no longer the case thanks to a new online tool by the Social Security Administration that allows people to find out how much they can expect in Social Security benefits when it’s time to say goodbye to the working world.

People can track their future retirement benefits by creating an account at account. Once there, the website will prompt you to create a personal account with a secure username and password.

“So far we have about 13.5 million people currently using ‘my Social Security’ accounts, and we’re getting a new sign up every six seconds,” said Mark Hinkle, deputy press officer for the Social Security Administration.

Once an account is open, people can review and verify their lifetime earnings for accuracy.

“It’s good to get that information as early on as possible, as young as possible, because they can actually plan and have a comfortable retirement with the knowledge of what they are going to get from Social Security,” Hinkle said.

The website also allows users to manage their benefits once they start to receive them.

On average, Social Security replaces about 40 percent of their pre-retirement earnings.  “It’s obviously one part of a solid retirement and having an estimate is a good starting point for what you need to do to supplement Social Security and plan for your retirement.


Smart Planning For Retirement

Smart Retirement Planning – Part 2

Bank Of America Settles With Uncle Sam Over Mortgages For Nearly $17B

This is how Wall Street gets away with crimes. Obviously, if Bank of America settles with government for $17 BILLION the crimes must have been really huge. So the bank settles (with shareholder money) and nobody goes to jail or loses their cushy job. And of course the stock goes UP as this issue is now safely behind them. There are different rules and outcomes for Wall Street crimes compared to everyone else.-Lou

The logo of the Bank of America is pictured atop the Bank of America building in downtown Los Angeles

Bank Of America Settles With Uncle Sam Over Mortgages For Nearly $17B


Bank of America BAC +1.61% is the latest bank to agree to cough up billions for mortgage misdeeds committed before the 2008 financial crisis, reaching a settlement that includes $9.65 billion in cash and totals nearly $17 billion.

“We believe this settlement, which resolves significant remaining mortgage-related exposures, is in the best interests of our shareholders, and allows us to continue to focus on the future,” Bank of America Chief Executive Brian Moynihan said in the announcement of the pact.

The settlement includes a $5.02 billion civil monetary penalty and $4.63 billion in compensatory payments, as well as$7 billion earmarked for “consumer relief. The charge will result in Bank of America taking a $5.3 billion pre-tax hit to third-quarter earnings, but just $4.5 billion — 43 cents per share — after tax thanks to a portion of the settlement being tax deductible.

Some of the malfeasance targeted in the settlement came on the part of Countrywide and Merrill Lynch. BofA bought the first in 2007, as the housing bubble was bursting, and has already spent billions settling claims over the quality of the mortgages Countrywide underwrote as the bubble inflated. The deal was one of the most disastrous in recent memory, and for a time it seemed as if BofA’s late 2008 takeover of Merrill Lynch could be more of the same.

Fortunately for the bank, and for Moynihan, Merrill’s wealth management prowess has become a key fulcrum for the company’s future growth, and looks even better as it works through its legacy mortgage issues.

Thursday’s deal resolves existing and future claims from the Justice Department, SEC, a group of state attorneys general (California, Delaware, Illinois, Kentucky, Maryland and New York), the Federal Housing Administration and Ginnie Mae. It also resolves pending claims from the FDIC.



Unless Your Wealthy, Never Buy A New Car

Todays column for Physician’s Money Digest.-Lou


Unless Your Wealthy, Never Buy A New Car

Louis G. Scatigna | Wednesday, August 20, 2014

After our homes, cars are the costliest items that most people buy. In the course of our lives, we will buy as many as 10 to 15 cars. So how we buy and finance our cars can make a huge difference in our financial health.

Years ago, most families had one car, which they kept until it died of old age. Today, families tend to have more than one and will buy a new one every 4 or 5 years.

Cars are de-investments, which is my term for assets that are guaranteed to decline in value. When you invest, you hope that the value of your investment will increase, but when you buy a car, you know that its value will steadily drop. Since the main purpose of a car is to provide transportation, to get you from point A to point B, it may be time to rethink how you purchase one.

Cars are depreciating assets. Let’s say that you just bought a car for $22,000. The salesman congratulated you for making such a great deal and as you drive home, you feel like a million bucks. Actually you should be crying because you lost $4,400 the moment you left the lot.

New cars lose about 20% of their value as soon as you take ownership. Then, they depreciate anywhere from 6% to 13%, annually. So in the first year you could lose $5,720 to $7,260. Ouch! The money you lost could have been saved or invested in assets that usually appreciate over time.

If you buy 10 cars during your life at an average cost of $25,000 each, you will lose $65,000 to $82,000 in first year depreciation alone. Although the car manufacturers won’t like me, I’m going to make a bold, but true, statement: Unless you’re wealthy, never buy a new car. It will damage your financial health.

A new auto is more expensive than a used car as are the monthly payments, costs of insurance and registration. New cars immediately depreciate at an accelerated rate so if you have to sell soon after you bought it, then you’re going to take a bath.

Buying a used vehicle costs far less and makes much more financial sense.

Being financially healthy means accumulating wealth, and we accumulate wealth by saving and investing. So let’s take a look at how much we really lose over a lifetime of buying new cars.

Let’s assume that we buy 10 new cars during our lifetime — one every 5 years between ages 20 and 70. Let’s also say that the first-year depreciation is $6,500 on each car. Had we invested that $6,500 and received an annual 5% return, at age 75 we would have accumulated $437,535, which isn’t chump change — if fact, it could be a nice retirement fund.

Instead of purchasing a new car, buy a 2- or 3-year-old vehicle that has just come off a lease. Over the years, the quality and reliability of cars have improved dramatically. Today’s cars are built well and can be expected to run for at least 150,000 to 200,000 miles when they’re properly maintained.