How bad a shape is Illinois in?

The looming bankruptcy red flags continue to mount for Illinois as individuals and companies exit the state in search of good jobs, lower taxes, and to escape the entrenched cronyism, corruption and dysfunctionality of its politicians and unions.

Financial Management Cash Management What anti-check fraud procedures are in place?  Do we have systems in place to detect money laundering?  Are all bank accounts reconciled each month? What minimum cash balance is appropriate for the company?  Is the company using every available technique to minimize transfer time for collecting cash balances? (a) rapid billing; (b) lock boxes; (c) discount policy; (d) collection efforts  Who is authorized to make payments of company funds and what amounts are they authorized to disburse?  Are authorized persons bonded at the appropriate amounts?  What is the company's plan for optimizing the balance between maintaining the liquidity of excess cash vs. generating maximum short-term and long-term interest income? What proactive measures are taken within the company to prevent embezzlement? cash flow: What are the long-term cash needs for the company for the purchase of property and equipment?  What effect does the variation in key assumptions (sensitivity analysis) have on the financial projections? | cash flow statement: direct vs indirect | check fraud: anti-check fraud procedures | Forecasting Cash Flow sp | money laundering: detect money laundering bankruptcy: Has the company ever filed, or considered filing, for bankruptcy?  Are any of the company’s vendors in bankruptcy or near bankruptcy? | American Bankruptcy Institute: | appraisal of asset values: | banks: bank run |checklist: IRS | IR Internet Bankruptcy Library: | liquidation services: investment policies: What is the minimum acceptable investment return on capital items?  How are lease vs. purchase decisions evaluated?  What is the company's investment policy with respect to excess cash?  How much is kept in short-term marketable securities?  What is the record of gains (losses) from sales of securities in the company's portfolio?  Does the company perform background checks on either the firms or individuals that handle the company's trading in securities? Checklists | Cities | Identity Management | Personal Finances


DAVOS: World Economic Forum

Economic Theory and Systems Economic Theory: index of economic freedom Economic Systems Historical development of economic systems Capitalism Centrally-planned systems Appraising economic systems The Consumer and the Market Scarcity, utility, and value: behavioral economics: | Valuation Consumer behavior: Buying Decisions | inelasticity Markets: markets hate uncertainty | Randomness Price system in capitalist economies Organization of Production and Distribution Organization of the production of goods Marketing and Merchandising Inputs of the productive process Institutions that facilitate business formation, production, output Money Currency & Exchange Banks International: Bank for International Settlements BIS economic statistics business organization stock markets Agricultural economics International trade Government’s role in production & distribution Methods of business organization Advertising & Promotion Distribution of risk Consumer credit For a disciplined credit card user, the interest rate is essentially irrelevant because a credit-smart consumer pays off the most recent transactions with each monthly bill; i.e., you never carry an outstanding balance which is the most powerful way to build a solid credit rating.  If you want a rewards program with your card, then that generally requires an interest rate greater than 0% and the higher the interest rate, the better the rewards since interest income is what covers the cost of the rewards program for card issuers.  But as previously stated, if you are paying off the transactions each month and not carrying an outstanding balance, the high interest rate is irrelevant.  BOTTOM LINE: use a credit card for convenience, security (don’t have to carry alot of cash around), and to create a detailed transaction record,  but not as a loan! Distribution of Income and Wealth the rich get richer and the poor get poorer Matthew Effect Distribution by categories of the population: Forbes 400 | gini coefficient How government affects the distribution Capitalism Taxation Laffer Curve postulates that no tax revenue will be raised at the extreme tax rates of 0% and 100% and that there must be at least one rate where tax revenue would be a non-zero maximum. Poverty Macroeconomics National income and employment theory: misery index Intl. equilibrium and disequilibrium Business cycles Inflation and deflation Economic Growth and Planning Nature and causes of economic growth Planning for economic growth and stability Government Finance Growth books, forums, journals Stealth of Nations by Robert Neuwirth The Mystery of Capital by Hernando De Soto big ideas The Wealth of Nations by Adam Smith Wall Street Journal World Economic Forum Davos Globalization | Buying | Acquisitions | Economics | Human Rights | Issues |

Debt in retirement

We’ve chosen to keep our mortgage in retirement.  We refinanced to take advantage of the historically low rates and that  has dropped our monthly payment amount which is good during retirement mode.  And we get to keep the deduction for mortgage interest which helps at tax time.  If something comes up where we will need some cash (emergency; health issues; remodeling), we can easily open a Home Equity Line of Credit (HELOC) and also get a deduction for the interest on that loan.  With bank, CD, and mutual fund rates so low, for our house in our neighborhood in our town, it is the most reliable performing asset we have, having consistently appreciated over the long term (30 years).