Small Business Owner’s Legal Guide to Debts and Bankruptcy. Know what can and cannot be done to you by your creditors.

June 23, 2010 by oscadmin · 12 Comments
Filed under: Entrepreneurship, Legal 

Because they are under pressure from two sides, small business owners must worry about the action of both business and personal creditors. People collecting for creditors will often threaten or seem to threaten all types of dire actions—some of which they cannot legally do. It is good to have an idea of what can, and more importantly, cannot be done to you by your creditors.

Steps the Creditor Cannot Take
Owing money you cannot pay is stressful partly because you feel guilty and maybe like a failure. The other source of stress is from bill collectors and their tactics. When you start receiving phone calls from collections people, they are often quite aggressive, if not abusive. We have been told many times that creditors threaten to have the debtor arrested and put in jail, or to have his or her salary or tax refund garnished. Creditors often tell people that it is fraud to not pay back the money they borrowed.




Jail
One cannot be arrested and put in jail for a civil debt owed to a credit card company or a bank. Normally, the only time you can be sent to jail is when you break a law or fail to obey an order of the court in a family matter. Owing money to a person is not a crime and is not something for which you can be jailed. The United States has done away with debtors’ prison. Nowhere in the United States can a creditor seize your paycheck or property without a lawsuit and the opportunity for you to have a trial.

Seizing Property
Creditors will sometimes say things such as, “We are going to take all of your property,” or if they are particularly sadistic, “We are going to take your kids’ furniture and pets.” People have visions of their things being taken from their homes and piled up in their front yards for everyone to see. This is almost certain to never happen, so try not to let this threat bother you. A creditor cannot just call a police officer and start hauling furniture out of your house. Even if a creditor wanted your furniture, he or she would have to get a court order before invading your home or office. This means that your creditor would have to go to the expense of a lawsuit.




Tax Refunds
A private company cannot have the government seize your tax refund. If you owe taxes or money on a government-guaranteed student loan, then you can have your tax refund seized by the government, but a private company does not have this authority. If someone who is not part of a government entity or collecting for a government entity threatens to seize your tax refund, take this threat with a very large grain of salt.




Wage Garnishment
It is quite common for creditors to threaten to have your wages garnished (money removed from your paycheck to send directly to the creditors). This is a powerful collection tool if you are earning a wage, but of limited use against a self-employed individual. Additionally, not every state allows wage garnishment.




Harassment
Given the limited range of what credit collectors can do without filing a lawsuit, they often start by pestering or harassing you to distraction. We have had reports of people getting calls from the same creditor several times a day. Calls start at seven o’clock in the morning and go to eleven o’clock at night. Collectors often call debtors at work after being asked not to, and many times the receptionist or other employees are told about the person’s financial problems. Family members are often called and told about the person’s debt problems. We have even had cases where collection people talked to
neighbors and told them the person was not paying his or her bills.
Books on debt management often advise readers who are having extensive financial problems to contact their creditors, explain the situation to them, and try to work out a reduced payment schedule. In our experience, this almost never works.
It may be possible to work out something with one creditor, but if there are several creditors, there are almost always some who will not work with you and insist on full payment. Some will insult you as you pour your heart out to them. Unless all creditors agree to a reduced payment, it is unlikely that setting up a system of reduced payments will work to solve your financial problems.
The other problem with this advice is that you often talk to a different person every time you call the creditor or the collection agency. You can make an agreement with one person at the agency, and then a few days later get an abusive collection call from someone else at the same company. When you try to explain to the new person that you have worked out a reduced payment plan with someone else at the company, he or she often will deny any knowledge of it and demand full payment at once. Often he or she will say, “I have never heard of that person,” or, “There is no such arrangement noted in the computer.” It is emotionally exhausting trying to explain the same thing over and over again every few days while being verbally abused.
We have heard this sequence of events told to us so often that we are convinced the collectors are using one or two techniques. One is good cop/bad cop, where one collector will be nice and understanding and the next will be hateful and try to break you down. The other is the wolf pack method. When wolves hunt a deer, one does not run up and kill the deer.
Rather, they will take turns running up to the animal and biting a bit of flesh away. No one bite kills the deer. The deer bleeds to death or just gives up in exhaustion.

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Technical Analysis Toolbox. 7 Checklist of Key Technical Tools. 3 Basic Goals of the Technical Analysis Tools

June 8, 2010 by oscadmin · 15 Comments
Filed under: Stock Trading 

There are five major categories of tools in a complete technical analysis toolbox, and novice chartists need only to have a basic understanding of what they do.

The Three Basic Goals of the Tools

1.    Find obvious patterns and trends
2.    Check an indicator or two
3.    Compare current condition to others




1.    Seeing where the stock is currently trading and figuring out how it got there
This is where we explore charting tools such as:
    stock trends,
    support levels (that point at which a stock is trading at which demand is thought to be strong enough to prevent the price from declining further), and
    resistance levels (that price at which selling is thought to be strong enough to prevent the price from rising further).
We’ll also try to find a pattern or a trend to help.

2.    Determining the power of a trend
This is also where we can find signs of an imminent end of a trend. For that, we will look at important technical concepts such as trading volume and momentum.

3.    Making comparisons of the stock to the market, its peers in its own industry and even to its own history
This is where we look at relative performance and moving averages. We have not covered relative performance of a stock to its industry group yet, but it is simple enough to cover directly here.
If we know how fast a stock is moving, how much power is behind it and how it stacks up to the market, then we’ll gain a huge advantage over other investors looking only at the fundamentals (such as price-to-earnings ratios, return on equity, or earnings growth).

In looking at a stock, here is a checklist of key technical tools. Any potential investment should meet most, but not necessarily all, of these criteria.




Price Structure
Trends and Trendlines
There is no secret to finding a trend. If prices are generally rising and making higher highs as well as higher lows, then we have a rising trend. Most charting web sites also offer the ability to draw trendlines on the chart to clearly define the trend more objectively. Alternatively, the old-fashioned way of printing the chart and using a ruler and pencil works just as well.
 We want stocks that are in rising trends.

Support and Resistance
These are terms that simply tell us what price levels are likely to bring out the buyers (demand) or the sellers (supply), respectively.
 What we want to see is a current price that has either just moved through resistance (demand overwhelmed supply) or one that is far from the next resistance level.




Moving Averages
Moving averages (or simply price averages) are just average prices over a user-defined period of time, usually 50 or 200 days. They help us determine if a trend is turning, as prices cross the averages. They also help us determine if an existing trend is progressing in an orderly manner, or if it is accelerating in a frenzy.
 Clearly, we are looking for prices to be above selected averages but not too far above them.

Relative Performance
Relative performance charts simply divide the price of a stock by a relevant market index or industry group. The theory is that we should buy strong stocks in strong sectors and this is how we find them. If the ratio is going up, then the stock is outperforming the market or industry and is thus a strong candidate for further gains. If the ratio is going down, then the stock is lagging and is often more vulnerable to bad news.
 We are looking for stocks whose relative performance is increasing.

Volume
The number of shares traded and when those shares trade—either on days when prices rise or when they fall—can confirm the health of a trend or warn of an impending change.
 We are looking to see if buying is spreading to other investors and for urgency for all to buy when prices start to rise.
Fear of missing a good thing causes these surges.

Momentum
Jargon alert! The next paragraph is summarized in one sentence at the end.
We also want to know if days when the stock rises outnumber those when it falls. Are the gains on these positive days greater than the losses on negative days? When the losing days are bigger and more frequent than the winning days we can surmise that the trend is weakening.
 We want to know if momentum is strong but not too euphoric.




Sentiment
We’ll just worry about obvious extremes in sentiment, as this portion of the analysis is tricky even for the pros. Is everybody thinking the same thing? That’s the time to go the other way. And as some traders will say, sometimes the best trades are the ones that make you sick as you leave the comfort of the crowd.
Note     Sometimes the best trades are the ones that make you sick as you leave the comfort of the crowd.
 We want to know if everyone is thinking the same thing.

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