Top Ten US 2007 Insurance News Stories

As selected by Insurance Journal

1. Climate Change
In February, the Intergovernmental Panel on Climate Change issued the first of three reports. It confirmed: 1) the temperature in the atmosphere and the oceans has grown warmer and can be expected to continue to do so. 2) The amount of greenhouse gasses, mainly CO2 and some methane, has increased markedly since 1750. 3) These gasses are the most significant cause for the temperature increase. 4) Human activity is primarily responsible for their production.

Al Gore helped the cause, but in reality, currently there is little being done because people want to be green on one hand, but won’t do what it takes to ‘be green’ like stop driving their SUV’s.

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Too Much Flexible Spending – What to Do With Your Income

flexible spending

Hi and Lois Nov 25, 2003.

There are 3 types of people in life: The spender, the lender, and the investor.

“Poor people spend and buy stuff, the middle class buy liabilities, and the wealthy buy assets.”

Let’s take a look at these truisms.

The spender will buy stuff, putting off achieving their financial goals until they have more money. In fact habits become harder to break over time. The day they plan for their financial future may never arrive. The spender needs to realize that almost every wage earner is capable of both meeting their every day expenses and investing for their long term goals.

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US Won’t Block Climate talks in Bali

Turns out somebody in the US wants to talk climate change. US delegates to a UN climate conference suggested they will not be a roadblock to a new international agreement aimed at reducing potentially catastrophic greenhouse gases, but refuse to endorse mandatory emissions cuts. Many governmental delegations at the meeting in Bali see mandatory cuts as crucial for reining in rising temperatures.

Faced with melting polar ice and worsening droughts, delegates from nearly 190 nations opened the two-week conference with pleas for a new climate pact to replace the Kyoto Protocol, which expires in 2012. That deal required the 36 signatories to cut emissions by 5 percent.

A key goal of the conference will be to draw in a skeptical United States, now the sole industrial power that has refused to rafity the Kyoto Protocol, citing fears it would hurt the U.S. economy because cuts aren’t required of rising economies like those in China and India.

The US repeatedly defended their refusal to embrace emission caps after Australia’s new prime minister signed papers Monday to ratify the 1997 Kyoto agreement – reversing the decision of his nation’s previous, conservative government. We for one side with the US (a bit). Actually no, we side with Canada. The impact Kyoto will have on the overall environment will be nil (from a Canadian contribution standpoint) because the major producers like India, China, and US won’t participate.

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Sub Prime Scare Made Your House Worthless? Burn it Down!

Falling on hard times? Turns out the way to get out of your massive house payments you agreed to cause you don’t know how to deal with money and live beyond you means is to burn your house down!

Insurance fraud investigators are actually preparing for more arsons by cash-strapped homeowners trying to avoid foreclosures and ballooning monthly payments as the subprime mortgage crisis deepens. Read more »

GM Dumps Pants and Cuts 1200 Jobs in Canada

When you make crappy cars and you primarily rely on a weak Canadian dollar to compete with your world rivals you’re bound to hit some snags along the way. Case in point GM, they just can’t make ends meet so what happened?

General Motors of Canada will cut 1,200 jobs at an Ontario truck plant in January, a move the Canadian Auto Workers Union says shows the effect of slumping U.S. housing and credit markets on the already struggling auto industry (sure, that’s the only reason why…..) Read more »

Holding Off From Selling Off After Sub Prime Scares

This is the story of Ernest and Serenity J. Ernest is a project manager at Dubblebubble Space Corporation. His wife is a teacher. They have 2 children, Cordelia 14 and Brent 11. Since the family came back from vacation in Halifax, Ernest has been working a few late nights and weekends as his company is expanding their information systems. As a result he and his wife have had to postpone their usual Saturday night dinner date. However, this gave Mrs. J and the children the opportunity to go to West Edmonton Mall for some back to school shopping. She is planning to surprise Mr. J with a 60 inch plasma TV for his upcoming birthday.

With her babysitting money Cordelia buys the latest trends from TuTutemon. Brent has already put in a request for a Playstation 3 for Christmas. He is too young to work but makes a few dollars from walking the neighbor’s dog when they are away.

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Encana Trying to Screw Albertans Through Royalties

EnCana has conducted their own biased evaluation of recommendations contained in the Alberta Royalty Review Panel Report. Of course, EnCana is worried about their investors and without surprise noted how negatively the proposed changes will have on EnCana’s billions of dollars in revenue. They are now threatening to pull significant investment out of Alberta. Without knowing much about their oil investments worldwide I say good riddance. Let them go, someone will happily take their place and turn a few billions rather than multiple billions on the oilsands that exist in Alberta.

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Canadian Dollars hit Par with USD

First time in 30 Years

Importers are thrilled, exporters are finding new ways to adjust. Tourists are reaping the benefits, domestic consumers still can’t catch a break. The new economy is hot, perhaps to hot in Canada, as for the first time since the 70’s the CDN dollar has hit par with the USD. In fact, considering the cash back rate one would actually LOSE money cashing in American dollars. Here are some articles collected from around the finance world on the day of the historic event. Post your thoughts below about how this change has affected your life and business.

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US Consumer Credit Increases Yet Again

Originally posted in our forum and moved here:

Forget about the fact you can’t afford the new car or couch, that hasn’t stopped Americans from spending way more than they earn. US consumer credit rose by a bigger-than-expected $10.27 billion in June on a surge in credit card debt, said a Federal Reserve Report.

Consumer credit outstanding rose to $2.186 trillion in June, rising at a 5.66 percent annual rate from $2.176 trillion the prior month. Revolving credit, which includes credit and charge cards, rose by an annual 9.80 percent rate in June to $820.65 billion after a 11.04 percent surge a month earlier.

Non-revolving credit — closed-end loans for cars, boats, education expenses and holidays — rose 3.19 percent to $1.366 trillion in June after slipping 1.35 percent the prior month.

This just in, take control of your finances and stop using bad credit to your spending splurges, it will help you in the long run!

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Canadian Trust Funds Explained – Trust Funds 101

Here are tidbits on trust funds:

What is a trust?: A company with a special legal structure that allows it to pass profits on to the people who own it without having to pay corporate taxes.

It’s a kind of corporate security similar to a share in a company.

A share of an income trust is called a “unit” and investors can buy and sell them like stocks — via a broker or discount brokerage.

Advantage: By paying little or no corporate taxes, the company can pass on more cash to its owners. Companies pay most of this cash to investors in monthly distributions.

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