May

19

That DOESN’T Make Me Stabby: Mandated Free Credit Scores

Filed Under Credit, Financial News, That Makes Me Stabby | Leave a Comment

Finally, the US consumer is close to winning one. The US Senate has just passed an amendment that would give consumers free access to their credit scores under certain circumstances, such as denial of a loan or a job due to your credit score. (This is currently the law for credit reports.) If passed by the House, it would go into law as part of the Wall Street reform package. As happy as I am about this progress, it doesn’t go far enough.

Why Should We Pay for Credit Scores?
Frankly, I don’t believe consumers should pay for access to credit reports or credit scores. Lenders already pay for the data, which they use to make business decisions. Meanwhile, consumers are also required to pay for credit scores and additional credit reports, even though they’re based on OUR DATA, and influence our financial lives. In some cases, they also affect our job prospects.

Free Credit Reports All the Time
I realize that this would put those “free credit report” sites out of business, but as far as I’m concerned, consumers should have free access to their credit reports all the time, not just once a year as the government requires. Can you imagine a bank only allowing access to your account statement once a year? Credit reports aren’t that different, given the frequency with which they can change.

Free Credit Scores All the Time
Credit scores are almost more important than credit reports this time. When we were applying for mortgages, the lenders pulled our credit reports and scores. Yes, they looked at the reports, but the most important factor in preapproval was our credit scores. The rest of the report didn’t come into play until we entered escrow and the full mortgage application process.

Credit Scores Should Be Included with Annual Credit Reports
When I log into annualcreditreport.com to download my report for a specific bureau, the FICO score for that report should also be displayed. Not the Vantage Score or whatever other fake scores the credit bureaus are trying to profit off of. The FICO score is the only score that matters, and that’s the one I want.

The free scores for denials of credit or employment are a good start. That’s where the free credit report system started. But it doesn’t go far enough. If you agree, write your Senators and your Representative and ask them to take it to the next step. They know what I’m saying is true, but until voter anger outweighs credit bureau lobbying money, it’s not going to happen. And that, folks, makes me a little bit stabby.

Jan

20

That Makes Me Stabby: Poorly Considered Taxes and Fees

Filed Under Financial News, That Makes Me Stabby | 1 Comment

I understand that states are strapped for cash, but I’ve heard two recent proposals from California and New York governors that strike me as going too far. It’s one thing to try to close the gap by increasing the sales tax, but another thing entirely to drive us into a total nanny state. These attempts to get more money out of taxpayers and non-taxpayers alike make me stabby.

California: Catch Speeders on Red Light Cameras
Governor Schwarzenegger’s proposal is to reconfigure red light cameras to catch speeders, too. For those going 1-15 miles an hour over the limit, the fine would be $225. For those going more than 15 miles an hour over the limit, the fine would be $325. Now I appreciate the goal of reducing speeding, but I have a problem with the fine kicking it at 1 mile an hour over the limit. Speedometers are not that exact. AAA even offers speedometer testing because they can be off! My car was routinely five miles per hour off until I got a new timing belt. I don’t think it’s fair to penalize people for speeding if they don’t even realize they’re speeding! Rules like this should start at least 5 miles per hour over the limit. It’s what most cops do, and the cameras should be the same.

New York: Taxes on Non-Diet Sodas
Today Governor Patterson announced a proposal to add another $1 tax to cigarettes and a 15 percent tax on non-diet sodas.  He says the second one is necessary to combat obesity. I don’t necessarily have a problem with taxing cigarettes because states do often bear the burden of smoking-related health costs once smokers enter the Medicare system. There is no such thing as safe smoking.

You can’t put non-diet sodas in the same category. Millions of people drink an occasional soda without getting fat. Should I have to pay extra for my one soda a month because I don’t like the taste of diet soda? Are we going to put a 15% tax on candy bars and fast food, too? What about potato chips? Pizza? Doughnuts? Sugary coffee-beverages? Heck, let’s just tax everything that isn’t a vegetable. The root of the problem is the way people in our country eat, not a specific food item, so taxing one food item will have no effect on obesity. Those people will just eat or drink something else to get their sugar fix.

States need to learn to balance their budgets without introducing poorly-considered fees in the name of the public good. Is a soda tax really going to close New York’s budget hole? How about those red light cameras? I doubt it.

If you live in California or New York and disagree with these proposals, make your voice heard. It’s the only thing that will stop the stupidity. Or suggest your own stupid tax. Here’s one: let’s reconfigure the red light cameras to catch people texting or talking on the phone while driving. I’m sure the Governor will love that one until he gets the bill for his wife’s tickets.

Dec

10

That Makes Me Stabby: TARP Redistribution

Filed Under Financial News, That Makes Me Stabby | Leave a Comment

Just when I thought we were finally making progress on that whole TARP debacle. Another bank paid back the money, and taxpayers were informed that we really hadn’t lost all the much money on the bailouts. I thought “Yay, we finally catch a break.”

Enter Congress, stage left. The audience heaves a great sigh. I get stabby again.

TARP Redistribution Is Not a Good Plan
Call me cynical, but I wonder how much of this plan is designed to shore up Democrats running for re-election in 2011. And I say that as a Democrat and a supporter of Barack Obama.

I don’t disagree that Main Street is ailing. I don’t disagree that small businesses are suffering. I don’t disagree that we need to create jobs.

I do disagree that redistributing excess or repaid TARP funds are the way to do that. Mostly because I never supported TARP in the first place. The only portion of the stimulus I supported was infrastructure improvements, which creates jobs, which enlarges the tax base. Even with the TARP redistribution only includes a puny portion for infrastructure.

Small businesses do need help. They need it in the form of the small business loans that banks still aren’t issuing. I don’t know how the government can force banks to start lending again, but loans are what businesses need. Loans and customers. Customers will come when they have jobs, but the businesses need the loans so they can hire people in order to produce the things that the customers will want. It’s a vicious cycle, and none of the current initiatives will fix it.

Let’s Pay Down the Debt
My first thought was that we should pay back the loans that the TARP money came from, but it turns out the money came from Treasury Bills. Those have a fixed maturity date, so we can’t just repay them now. We can, however, pay other debts. So why don’t we do that? No, it won’t affect Main Street, but it will be good for the economy and good for our grandchildren, who will be stuck paying the bill for our sins through their higher taxes.

So, rather than borrowing more money to pay this year’s interest on our debt, why don’t we use the TARP money? The interest on our debt is $383 billion. The TARP money is just over two years’ of interest. That’s $700 billion less that we have to borrow to cover our debt. The debt is currently $12 trillion. Not borrowing $700 billion wouldn’t make a huge dent, but it’s still 5%. I think many people would be happy to reduce their debt by 5% without doing anything.

Am I crazy for thinking this way? Am I not seeing something? I just don’t see how spending more money on tax credits is better than paying down debt that will saddle all of us with higher taxes down the road. We can’t just keep kicking this can down the road. It’s time to pick it up and put it in the trash.

Nov

13

The New Overdraft Fee Rules

Filed Under Bank, Financial News, Money Management | 3 Comments

As you may have heard on the news, the Federal Reserve released new rules restricting overdraft fees yesterday. Unfortunately, the rules aren’t quite as comprehensive as we would probably like. Congress is considering even stronger regulations, but there’s no telling when or if they will be passed. Here’s what you need to know about the current rules.

When Do the Overdraft Fee Rules Apply?
As with all Federal Reserve rules, there’s a lengthy waiting period for the new rules. They don’t take effect until July 1, so you can be sure the banks will be doing everything they can to maximize their overdraft fees in the meantime. Be extra vigilant and take steps to avoid overdraft protection in the first place.

Which Overdraft Fees Are Restricted?
Under the new rules, overdraft fees will still be fully permitted as an opt-out program for bounced checks and online bill pay. Overdraft fees will be made opt-in for ATM withdrawals and one-time debit card transactions/purchases.

What Does Opt-In Mean?
Currently, most banks automatically enroll their customers in overdraft protection. They claim it’s for your “convenience” so your purchases aren’t denied. Most customers say they’d prefer to have their purchases denied rather than pay an exorbitant fee so they can buy a pack of gum.

Under the new rules, all banks will have to ask their customers if they want overdraft protection for ATM and debit card transactions by July 1, 2010. If you don’t say yes, then they have to disenroll you from the protection. But watch your bank communications carefully – I’m sure they’ll try something squirrelly to get you to opt-in without you realizing what they’re doing.

What Should You Do?
Overdraft protection is a personal choice. My choice is not to have it – I’d rather manage my money myself. If you feel the same way, call your bank right now and ask to opt-out of all overdraft protection programs. Your payment will bounce or your purchase will be denied if you go over the limit, but it’s probably still cheaper than the overdraft fee. If they call or write to ask you if you want to opt-in to overdraft protection, say no and then also ask to opt-out of all other overdraft protection programs.

How Did This Problem Get So Bad?
In a word, profit. The banks rake in billions in overdraft fees every year, so they opted-in all their customers without their knowledge. In addition, they sort all of your deposits and payments in a manner that maximizes the bank’s potential for fees through bounced checks and overdrafts. As the economy slid and their other profit lines declined, they ramped up the fees.

Last month they attempted to head off the new rules by reducing their fees slightly, but it didn’t work. You’ve no doubt seen or experienced all the credit card shenanigans the banks have pulled ahead of the new credit card rules. Be just as vigilant when it comes to your bank accounts because the banks are not on your side.

Sep

15

Will the New Frugality Last?

Filed Under Financial News, Frugal | Leave a Comment

On the first anniversary of the “official” start of the financial crisis (even though it was creeping up on us well before then), several articles have argued that the crisis resulted in a “new frugality” that has permanently altered the spending behavior and attitudes of an entire generation, similar to what happened after the Great Depression. I call BS.

This Recession and a Great Depression Are Not the Same
So far the recession has lasted a year to a year and a half. That’s longer than most, but nowhere near as long as the dual recessions that made up the Great Depression. It’s also true that the impact on people’s wallets will be felt for longer, but I doubt we’ll see the same wreckage we saw in the Depression.

No Food Shortages
Remember, the Depression was also accompanied by a drought (the famous Dust Bowl) that saw many, many crops fail. Although we still have droughts, our farmers have learned the lesson and don’t farm that way anymore, so we’re not looking at the food shortages that caused people to stretch groceries and stand in bread lines.

Cheaper Products
During the 1930s, some products were imported, but most were built right here. They also cost a LOT more to replace. Even with the recession, a family in need of new socks can find cheap options rather than learn to darn a sock. I don’t think people will take to knitting (which would be expensive) to repair cheap items. In addition, our stuff is no longer designed to last a long time, like it was 80-100 years ago. This weekend our DVD player broke. It would cost as much to fix it (if we could even find a repairman) as it would to replace it. Regardless of how the economy fares, we will still be faced with products that aren’t designed to be fixed.

Smaller Job Losses
Yes, we have high unemployment, but it’s still half the level of the Great Depression and it appears to be slowing. We will likely continue to see lags for the next few years, but unless we have a serious double-dip, I don’t think we’ll get to 25%.

We’re Not Heading into Rationing
This is something I considered this weekend, which I think most commentators ignore. World War II is credited with ending the Great Depression. However, the scope of the war was so great that the US government was quickly forced to start a rationing program for many household goods, including food.

There was essentially a 15-year period where a generation had to learn to do without or make do with less. That indeed does have a lasting impression and will form the behavior of a generation. I don’t think the current recession will last long enough to make a real change in American consumer behavior.

It’s Not All Bad News
I do hope that some of the changes will be lasting, partially because they were already the trend and partially because it will only take a few years to make something into a habit.

Increases in the Savings Rate
I hope that people will continue to see the value in saving money after the recession is over. Because it looks likely that it will take a few years for the jobs market to completely recover and credit will be tighter for a while, people will have a few years to turn saving money into a habit. Hopefully it will stick.

Interest in Sustainability/Anti-Consumerism
Sustainability, simplicity, and reduced consumerism were buzzwords before the recession, so I think they’ll continue to be popular after the economy recovers. Hopefully that will encourage people to make better choices, but at the same time we’ll still have products that are designed to be disposable. We’d have to make major global production changes to return to the era of repairing rather than fixing.

Delayed Gratification
Parents are learning to say “no.” Again, this was happening before the recession. Parents were realizing that molly-coddling kids and giving them everything they want is bad for them in the long-run. The recession intensified that trend and I hope it sticks. Our instant gratification society is part of what got us into this mess and fixing it will help us avoid getting there again.

Has the recession permanently changed your attitudes and behavior? Do you think the changes in attitude will last or do you already see people itching to spend? What one societal change will stick?

Sep

10

Our Financial Status One Year after the Financial Collapse

Filed Under Financial News, Money Management, Personal Finance | 4 Comments

There has been a lot of talk about the anniversary of the financial collapse this week. Most of it has focused on either the reporters who covered the story or the financial systems that were in trouble. I’m going to get a little more personal and talk about how my life has changed in the last 12 months.

We Paid Off Debt
Shortly after the beginning of the global meltdown, we completed the last of our planned debt reduction. We’d been working on it for months, and the changed financial system didn’t deter us from our path.

We Bought a House
We took advantage of low interest rates, the foreclosure boom, and the first-time homebuyer tax credit to buy our first house. It took us six months of looking to finally have an offer accepted, but we also managed to amass 20% down and make a good deal on a foreclosure in great condition.

We Kept Our Jobs
This is key – we were able to do all of this because we kept our jobs. My husband received a raise a few days after the crash, but other than that, our income has remained flat. We’re not complaining (too much) about that, because we’re happy both of our employers have survived without cutbacks in salary or benefits. We know we’re much better off than most people in that regard. We have friends who haven’t worked in months, but we also have friends who are independent contractors and are busier than ever.

I Didn’t Lose Our Retirement Completely
I kept investing in my 401K at the same level as before the crash, so I eked out a 0.8% gain over the last 12 months. Of course, the bulk of that gain is from my contributions, but the stock market rally has improved my balance slightly in the last 3-4 months. I had a fairly aggressive portfolio because I’m young(ish) and have a long timeline. That means my balance crashed more than the S&P 500, but also received more benefit from the rally.

We Have Some Savings
Even after putting 20% down on a house, we still have a cash reserve as an emergency fund. It continues to grow, despite the higher mortgage, insurance, and property taxes, because the mortgage deductions and first-time homebuyer credit significantly reduced our tax burden. Rather than file an amended return for 2008, or wait until next year, we simply adjusted our withholding so that we won’t be withholding Federal taxes through the end of the year. We’ll still get a small refund in March when we file our taxes, but we’ll get most of the money through the rest of the year, just as we start buying furniture. We actually would have lost some of the credit if we filed an amended return for 2008 due to our taxable windfall income. This year that’s not a “problem.”

All told, I think we did pretty well for the biggest financial disaster since the Great Depression. We’re grateful that we haven’t suffered the way some of our friends have. How about you? Where do you stand a year later? It’s time to finally open those 401K statements and take stock of your current situation so you can move ahead to the future.

Aug

21

That Makes Me Stabby: AIG Again

Filed Under Financial News, That Makes Me Stabby | Leave a Comment

I think I just need to start covering my ears and closing my eyes anytime anything involving AIG is on the news. Yet again, they’ve managed to make me stabby. Unfortunately, their latest infraction is evidence that the very companies that brought down our economy STILL haven’t learned from their mistakes, and probably never will.

They’ll Pay Us Back – Someday
In a talk to employees, he said “When we get the fair value for those businesses, that’s when we’re going to sell them; it’s not going to be before.” And apparently, that’s when we, the taxpayers, will get our money back. He also reportedly said that he “had the luxury to say to the government, I’m not going to rush to do this. I’m appalled at how much pressure has been put on all of you to just sell it no matter what, because the Fed wants out, or the Treasury wants out. If they want out in a hurry, they shouldn’t have come in in the first place.”

Shouldn’t have come in in the first place. There’s a word for that type of comment, but it’s not appropriate on a family blog. I’ll be honest, I didn’t agree with the bailouts, but our government believed it was saving our economy from an even worse collapse than the one we experienced. Maybe it did save us. We can’t know for sure. Apparently this new CEO would have preferred that we just let AIG fail. Of course, if we’d done that he wouldn’t have a job, but his thinking didn’t go that far on the issue.

It’s Not Their Fault
And now we get to the part that nearly made my skull open and fire erupt from it. Do you know why AIG failed? Do you know why our economy was driven to the brink of collapse? You’re probably thinking, “because financial companies bought and sold imaginary products based on made-up numbers.” Yes, a reasonable person would blame the financial companies for taking bad risks and making poor decisions in the name of greed, however, the new AIG CEO has a different viewpoint. “It’s time the people in Congress stopped talking about you as the problem, because you’re the solution,” he said. “It’s not your fault, it’s their fault, it’s the regulators’ fault.”

It’s the regulators’ fault. Yes, to some extent that’s true. But he’s also abdicating corporate responsibility. If our government doesn’t explicitly ban a practice or explicitly regulate a practice, then corporations are just going to go hog wild. They’re not going to think about repercussions or responsibility. Money is money no matter how they get it or what the repercussions are.

At this point, I imagine AIG is a pack of unsupervised two-year-olds in a candy store. They’re just going to eat and eat and eat until they get sick because Mom isn’t there to make them stop, and then they’re going to blame Mom for not stopping them before they got sick.

I do realize this was an internal pep talk meant to motivate employees because AIG is losing staff, however, the CEO should have been wise enough to know that this speech would leak to the media. Everything leaks to the media, especially if it’s juicy.

I’m now sad to admit that I was once a shareholder in this company. Of course, that was 10 years ago when they were still honest and reliable. At this point, I don’t know that I would be willing to buy their stock again because I can’t trust them to be financially responsible. Comments like the above are only hurting their case.

As an aside, what do you want to bet that they have lobbyists in Washington actively campaigning against increased regulations, you know, because if the regulators are at fault for not regulating them, then the solution couldn’t possibly be to be regulate them. His comments are proof that we do need more regulation – effective regulation – because we can’t trust financial companies to do the right thing.

Sigh.

Aug

13

The Recession Is Over – So What Now?

Filed Under Financial News | Leave a Comment

Much has been made this week by the Fed’s announcement that the first signs of economic recovery are appearing. The news has left many people wondering – if the economy is getting better, why doesn’t it seem like it? There’s a simple reason – economists have a different metric than the rest of us.

Official Definition of Recession and Its End
Officially, a recession is two quarters of negative GDP growth. A depression has no formal definition. When a recession ends, it’s because we have had positive GDP growth again. However, GDP growth doesn’t mean everyone is out of the woods. It simply means that the nation is starting to produce more and government spending is having some effect. If you consider this one factor, the recession is probably over. Unfortunately, the economy is about more than GDP.

The Rest Are Lagging Economic Indicators
If you look at the rest of the factors that go into the American economy during various recessions during our history, you’ll see that incomes, consumer spending, and especially unemployment continue to drag well after the recession officially ends. This is because the producers – our employers – squeeze current employees to boost the bottom line. Incomes and employment don’t start to rise until current employees have become as productive as they can and employers are forced to bring on more people to continue growing. When that happens, incomes can start to rise again and people will feel more secure buying things. That’s why they call these items lagging indicators. They confirm once and truly that the current crisis is over.

What about Housing?
This particular recession is tricky because it was caused by a housing bubble. Unlike the tech bubble, this is taking longer to pop and we will continue to see declines until employment improves. However, the housing problem is more severe in some areas than others, and some areas will stop seeing declines earlier than others. Some that haven’t yet declined will start to. There have also been a range of predictions about how much values will decline. No one can predict who’s right, but we can all say with some confidence that it will continue to be a problem for the next couple of years.

What It Means for You
Basically it means that there’s some light at the end of the tunnel. If you’re out of work, you might start getting calls for interviews again. If you have a job, this doesn’t mean you’re in the clear, especially if you work in a troubled industry or for a failing company. Unemployment often continues to rise after the recovery has started.

It’s also too soon to tell if the recovery will stick or if this is a “dead cat bounce” and it will start to decline again. Being a cautious person, I would invest carefully, but invest indeed. I would try to keep expenses low, but not live like a miser. And I would make sure that I’m still saving money every month. It never hurts to be prepared.

Aug

11

How to Avoid Overdraft Protection Fees

Filed Under Bank, Budget, Financial News, Money Management, Saving Money | 2 Comments

Welcome readers of US News’ Alpha Consumer blog! If you want to know more about our budgeting system, I’ve linked to a few budgeting posts about halfway down this post. If you’d like to learn more about how we paid off $40,000 in debt in one year, I detailed it last September.

This morning I heard a story from the Financial Times, by way of NPR, that banks earn $38.5 billion a year from overdraft protection fees. First, this is highway robbery, since most people don’t opt-in to these programs. Second, can avoid paying these fees. If you’ve paid an overdraft protection fee even once, it’s time to take action to avoid paying one again.

Disenroll from Overdraft Protection
About a decade ago, I had an overdraft protection plan. Back then, it meant they pulled money from my savings account to avoid overdrawing my checking account. There was no fee for this, because it was all my money. At some point, the bank stopped offering that and instead switched to using my credit card, but that required a minimum $100 advance, a $20 cash advance fee, and a higher interest rate with no grace period. I opted out of that.

If you’re not sure whether you have overdraft protection, call the number on the back of your ATM card and ask. If they say yes, ask to have it turned off. Yes, your debit card will be declined if you overdraw, but you’ll know right away. You won’t get hit with fee after fee after fee.

If you tend to get hit with overlimit fees on your credit card, ask to have that turned off, too.

Create a Budget and Use It
If you know how much money you have at any given time, you’re less likely to overdraw your account. If you only have $80 until your paycheck hits on Monday, you won’t spend $100 over the weekend. Not sure how to create a budget? Why I have a few posts about different budgeting methods:

The monthly budget combined with the cash flow budget
The envelope budget
The irregular expense budget

Spend Only Cash
Some people aren’t good with plastic, and that’s fine. If you tend to overdraw when using your debit card or go over limit with your credit card, withdraw a fixed amount of cash from your account weekly and stop spending when the cash runs out for the week.

Keep Your Balance on a Post-It
If your account balance is low and you have errands to run, check your account balance and deduct any pending checks or purchases from it. Write the remaining amount on a Post-It and stick it to your debit card. Record each purchase as you make it, and then stop swiping the card when your balance gets low. I’d leave a $10 cushion in case any checks or payments post incorrectly. It’s better to leave a cushion than to fight the bank to credit you later.

Spend Less Money
If you frequently overdraw your account, then you’re spending more than you earn. It’s time to cut back. Start using grocery coupons, take your lunch to work, stop engaging in retail therapy, sell some stuff to raise funds, drive less, whatever it takes to bring your spending below your income.

The Financial Times article noted that 10% of the population pays 90% of the overdraft fees. If you’re in that 10%, it’s time to start managing your money. If overdraft protection kicks in just once per month at $35 each time, that’s a savings of $420 a year. I can think of a lot of things I could do with $420 besides give it to a bank.

Jul

13

That Makes Me Stabby: More AIG Bonuses for Poor Performance

Filed Under Financial News, That Makes Me Stabby | Leave a Comment

Once again it’s been a month since my last stabby post, but I’ve found something that REALLY gets my goat. Get ready for it: more AIG bonuses. As you’ve probably heard, AIG is asking for permission to award yet more bonuses to the division that is at the center of the global financial collapse. I’m beginning to wonder how AIG defines “performance.”

Bonuses in the Real World
In the real world occupied by those of us outside the financial system, a bonus for performance is generally assumed to mean good performance. In this economy, even employees who are providing excellent service to their employers are not getting bonuses.

In fact, some executives and employees are taking pay cuts to keep their company afloat, regardless of performance. They certainly aren’t getting bonuses after losing the company money.

Bonuses in the AIG World
I could sort of understand bonuses paid to high-performing employees in other sectors of AIG’s business. Their regular insurance business is still healthy. The only sector of their vast business that went bad is the financial products division that sold insurance policies on derivatives based on imaginary numbers. So fine, if they want to pay bonuses to employees who genuinely did a good job in other sectors, I don’t necessarily take issue with that. Especially if it enables AIG to keep good employees in profitable divisions.

However, AIG seems intent on issuing “retention” bonuses to the very people who created this mess in the first place. Why do they want to retain these people?

Their first argument is that they need to keep the people who understand what they created so they can help undo it. It’s a faulty argument because clearly these people don’t understand what they created. If they did, they wouldn’t have done it!

Their second argument is that these people will be hired away by other large companies. Again, who would want to hire them right now? Here’s how I imagine that interview going:
“You worked for AIG’s financial products division?”
“Yes.”
“How much money did you earn for AIG?”
“My deals cost the company $20 billion.”
“Get out of my office.”

I realize that these people will eventually be hired by other companies. We have only to look at Robert Nardelli to find proof of people failing upwards.

Are They Kidding?
Seriously. What are they thinking? These employees may have brought billions of dollars into AIG at some point, they have now cost the company over $100 billion. Billion. How can they possibly argue that paying them “retention bonuses” is a good use of money? I don’t care that it’s “only” $235 million. Part of that is my money. You want to give someone a bonus? Give it to me! Or how about using it to pay back what the government invested in you so we can start to pay down our massive federal debt, which is now more massive thanks to AIG?

There are lots of options besides paying “performance” bonuses to people who lost the company, and therefore taxpayers, gobs of money. Unless, of course, “performance” means “breathing.” In which case, woohoo! Bonuses for everyone!

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