Weak economy, lots of debt, high unemployment. Up next: fewer universities!
Read the original to see students handing books to riot police in Rome:
BBC News, 12/22/10: Italian students demonstrate against education reforms
Apparently they fund one of your competitors and DESTROY YOU.
(Back story: Google offered to buy wildly successful Internet coupon company Groupon for $6 billion. Groupon said, “meh.”)
Read the original:
BBC News, 12/21/20: Google eyes smaller players after Groupon: report
Ever wonder how enormous old financial firms suddenly bite the dust? Well, the answer (according to the man suing Ernst & Young for civil fraud) is that they do stupid things with the help of accountants.
According to New York Attorney General Andrew Cuomo, giant accounting firm Ernst & Young helped their client Lehman Brothers hide billions of dollars in debt so that it would look like a healthier company than it really was. For seven years. Until (surprise!) Lehman went bankrupt in 2008.
Lehman owed a lot of people a lot of money (like, billions of dollars). But they didn’t want to go around telling people about it.
credit: kf6gpe
So (according to the lawsuit) Ernst & Young helped them hide their little debt problem with a ninja accounting tactic called “Repo 105.” Basically, Lehman would sell off a bunch of their assets and use the money to pay off some debt. That day was a good day, because when they had to show their financial reports to the world, it looked like they didn’t owe billions of dollars.
But – here’s the genius part – the next day, they would buy back the assets they sold at an even higher price, taking on more debt than they had before.
In exchange for its creative accounting services, Ernst & Young received $150 million in fees from Lehman between 2001 and 2008. Ernst says it was just using “generally accepted accounting principles,” which makes you wonder what other firms have been drinking. Cuomo says it will be paying those fees back to the State of New York by the time he’s done with them.
It’s holiday giving time! People who – oops – forgot to donate to charity all throughout 2010 are now scrambling to give away enough money to score some sweet tax breaks before the end of the year. But according to some lady at the Wall Street Journal, there are a lot of stupid things you can do when you engage in last-minute philanthropy.
credit: howard dickens
Let us count the things you should not do, according to Ms. Shelly Banjo:
1. Give impulsively. Newsflash: Charities are falling over themselves trying to get your attention. Good for them, but don’t be a philanthropic sucker. Think about what’s really most important to you, decide how much you want to donate, and engage in some thoughtful charity.
2. Donate stock you’ve held for less than a year. Did you know you can donate stock to some organizations? Did you also know that you can only get a tax deduction for doing it if you’ve owned the stock for more than a year? Now you know.
3. Donate stock that’s lost a lot of value. You can actually claim the money you lost on that stock as a tax deduction, which might lower the taxes you have to pay on the investments that did make you money. If you hold onto the stock and donate cash instead, you get double the deductions!
4. Think you can claim the cost of a fundraiser ticket as a charitable donation. Okay, actually you can do this. But you can only claim the cost above what the ticket is actually worth. (So if you bought $1,000 Knicks tickets to benefit a charity, but the tickets are actually worth $200, you only get to claim the $800 as a donation.)
5. Donate stuff (instead of money) to an organization that won’t use it. This is something only your accountant understands. Basically, the amount you can write off on stuff donations depends on the mission of the organization you’re donating it to.
6. Donate something called a “gift annuity” when interest rates are really low (i.e. right now). Gift annuities are basically donations to charities that earn you a little money on the side. The charity keeps the money you’ve given them, but they pay you interest every year on the amount you donated. So low interest rates mean your payments will also be low.
7. Obsessively stick to charity ratings. Rating sites like CharityNavigator.org and GuideStar.org are helpful when it comes to sorting through the jillions of charities out there. But they can basically only give you numbers. (And numbers liiiiie!) It’s up to you to get the full picture before you shell out for a particular organization.
8. Give to a charity that rents or sells your personal information. (duh)
9. Donate to the wrong donor-advised fund. Donor-advised funds are a complicated way of pooling your money with other investors so that you all save big on taxes while your money or investments go to organizations you all believe in. You don’t have much control over where the money goes after you put it in the fund, so make sure you’re a believer before you join a specific donor-advised fund.
10. Don’t get insurance if you’re on the board of an organization. Congratulations! You’re on the board of an organization. Now you’re partially responsible if that organization does something stupid. Directors and officers insurance exist for a reason.
Now that you’re paying attention, here’s a picture of two Christmas cats hugging to get you in the philanthropic mood:
credit: tuija2005
Aww.
Credit card companies are freaking out as they try to entice shoppers to pay for gifts with credit. But those 5% cash back offers aren’t exactly worth taking on thousands of dollars in debt.
“With the interest rates, it just seemed like I never paid it off.” – Liz Gonzalez, talking about her credit card debt
By cracking down harshly on government reformers, China is drawing international attention to the very activists it’s trying to silence.
“[As a world power, China] should become used to being debated and criticized.” – Thorbjoern Jagland, Chairman of the Norwegian Nobel Committee
Why wait until you’re dead to make your mark on the world?
“Wealth is an advantage, but it also is frankly a responsibility.” – Nicolas Berggruen, Investor, recently signed on to The Giving Pledge
Apple CEO Steve Jobs is allegedly a nightmare boss, but that hasn’t stopped him from changing (or taking over) the consumer world.
“He is not somebody [who] any one of us would want watching our kids, but, in terms of running the company, he’s excellent.” – Rob Enderle, President, Enderle Group
“The resurrection of Apple is just the most astounding story that’s probably happened in business in at least a decade — you might be able to go further and say it’s a half-century. It’s on par with Thomas Edison and Alexander Graham Bell in terms of its total impact.” – Roger Kay, President of Endpoint Technologies