i agree with you conceptually about only investing in thing you believe in, or rather in things you can stomach as most investments and industries have a downside if you look hard enough. eventually you get to exploited workers and poisoned rivers and solid waste. i personally struggled with the payday investment i made. the return was high, but i did not want to be associated with it. i said no for about 6 months. over that six months i learned how they (where my money is now) did business. after i understood it i had a hard time thinking of it any differently than a bank. they both loan money based on ones ability to earn money and pay it back. the only difference is the duration and the size of the loan. a bank allows me to spend money i don't have on a credit card and then charges me 13-18% until i pay them back while they themselves are leveraged 10 to 1 on those dollars loaned. the payday place will only loan me money that will be covered in my NEXT paycheck and charge me a flat fee of $5 or $10 while they themselves have a dollar for every dollar they loan out. when i look at it like that i really had no problem with the payday place, but started to have them with the banks. the payday places are not dragging the economy down because of their recklessness. they are also not enslaving an entire generation by offering them credit they cannot pay back. there are people who use them recklessly, and it is real easy to point them out because they are the fringe. it is a little harder to point out the middle class suburbanite who is a slave to their credit card and bank because they get up and go to work each day and keep a nice yard but are living on credit. both industries lend money and both are technically guilty of charging people who don't have money. they are in business to make money, not give it away. in the end neither is good nor bad just as fire is neither good nor bad. the good or bad all depends on who uses it and how they use it. the payday places service a far less afluent and unsophisticated clientele and therefore gives them very little wiggle room to abuse the system. if they want to stay one paycheck behind for the rest of their lives, that is about all they can do. the bank will let me get decades behind because they assume i am responsible and won't let it come to that but do little to stop me and recently have even encouraged me to do so. in my mind it is a match compared to the bonfire. both can be abused, but the potential abuse of a credit card is far greater. but there may be other payday places that have different policies than where i invested. mind you i don't have equity in the payday place�"they borrowed money from me to lend. in short my money is on deposit to be lent out just as if i put it in a savings account for the bank to lend out on a credit card loan. the main difference is my rate of return is almost 10 times higher but not FDIC insured. the only thing i do struggle with is the 10% they charge for cashing checks. this is outrageous in my opinion. i can't understand why anybody would do that unless they were unable to cash it elsewhere and i won't speculate as to why. but in the end they have their reason and are paying a premium for it. and with that i leave it. cigarettes are another issue and i am totally with you. i feel the same way about other products as well most are not as overtly damaging, but their products do carry liability and they push them with abandon to those who are hurt by them. not just talking guns and alcohol. a few minutes watching saturday morning cartoons was an eyeopener to the type of products marketed to kids. slap a mcdonald's logo on a bucket of mud and i think my kids would want to eat it. a friend of mine who is militant about his hate for phillip-morris and smoking in general (i think he lost a parent to lung cancer) holds half his portfolio in tobacco stocks. he justification was that it "those people" are going to annoy him with their smoke and take his taxes in healthcare, they are going to pay him for it. an interesting take on moral investing practices, but for him it makes sense. i respect your desire to not follow my practice of investing in payday lending. we not only have to undderstand our investments, but repect if not love them. i do not love payday lending, and to be honest would rather be elsewhere, but for the time being it is a good place and i am no so morally apposed to money lending as to not take the opportunity. i do however own no bank stocks for obvious reasons, i think their model is risky. i also think they are on the more unethical side of business. they have laws and loopholes that allow them to do things that are illegal to any other company. id it because we need their services and that is what it takes, or is it because they have power to influence if not make laws that favor them? i think recent events have shown us it is a little of both. before i sound too anti-establishment, let me say i think financial institutions are important and necessary�"ie. banks, insurance companies, the US government, the FED, and even payday lenders. BUT they are in busniness to make themselves rich, not us. if you do not understand what they are doing, how they make money, or worse, what you are doing, they will take advantage of you. thus education. it is through education that you can see the smoke and mirrors they use to make you feel good about making them rich at your expense. one of the most ubiquitous is the home mortgage. i am emphatic that the most expensive ways to buy a house are in this order; cash, paid off early mortgage, continually refinanced mortgage, a 15-year note, a 30-year note, ARM, variable rate, interest only, and deferred interest-AKA sub-prime being the cheapest. that said, i don't like differed interest as it assumes the risk in the real estate market and if used by the uneducated or irresponsible it can (and has) blown up in the borrowers face. what does the bank want you to do? they love you to take out a 30 year and refinance every few years or pay it off early. if you are going to take it to term, they prefer you take out a 15-year because it makes them more money and that is why they have a cheaper rate to take it�"they need to give you incentive to do what benefits them and think you are getting the better end of the deal�"if it makes them more money, how can it also save you money and show up in two places at once? this all sounds like hericy i know. but where do we get our financial education from? our bank? alan greenspan has a nice quote about the variable interest only mortgage being the best deal out there if people only knew how to use it and the 30 year not serving its customers as the think. i will see if i can find it. the mortgage subject was perhaps the most eye-opening and influential education i ever had in finance. it is the lesson that taught me to see the whole equation and not look at a financial strategy in a vacuum. it taught me to understand finance on a macro economic level to understand how to best use products on a micro economic level. it is painful and feels like you brain is removed and turned around and put back in. but i assure you it is all true and useful information, but it requires the user to be responsible for their financial life and some are not willing to do this and for them it is not wise to have control. just as fire in the hands a of one is destructive and to another the opposite. what i am talking about is basic business finance�"in short figuring out the lost opportunity cost and the taking the greatest margin. if done properly with understanding risk is minimized and growth is maximized. some will refuse to believe, but that does not prove those strategies wrong. i myself do not practice whole-heartedly all the strategies i know an believe because of issues regarding timing, my own laziness or whatever. this does not mean i don't acknowledge their strengths or potential. but it serves me to understand alternatives. there are many i have encountered on this forum and in other places who flat out throw up a wall and won't even try to understand that there are several strategies to use in every situation and they all have merits. my beef is with those who claim merits that are not truly there or ignore others. those who emotionally attach themselves to dogma that was sold to them without trying to understand. i have been guilty of this and still am at times and it only hurts myself. when i have a few hours to spend with a calculator, i will start a new thread and actually run the numbers on the most popular mortgage products side-by-side including paying cash. i will treat all as equals. it is amazing how different the outcome is from popular beliefs, but if you look at who is selling the mortgages and the information i guess it is not shocking. it won't prove anything other than which is the most expensive in terms of money and what risks are inherent in each scenario. the individual would have to choose which is best for them. the problem is that most choose the wrong thing for what they claim to want. if you know how they each work you can choose more appropriately for your goals whatever they may be.

When I worked as a personal financial advisor, I recommended that my clients have 3 - 6 months' worth of income available as an emergency fund, available in case of need. If they could survive for a year without any income ... so much the better. But ... I didn't have that, myself, and haven't for a number of years. And as my clients became more knowledgeable about how money works, I explained to some/most of them how I operate, with my reasons. For working people, they must continually be in sufficiently good physical, mental and emotionl health to go to their workplace and carry our their required tasks there ... or they don't qualify for that essential paycheque! Plus ... hope that their employer doesn't go broke, close the business, shift work offshore, or get amalgamated with another company, merging the employee's work into the other home office, etc. Now, as a senior, in receipt of two government pensions, one of them contributory, plus a private pension, plus a tax-deferred retirement account that requires an annual withdrawal amount of about 7% up to 10% or so, increasing with age to 20% at age 90), plus I can withdraw more, if I choose (but every dollar taxable) I do not have such a requirement. All that I need do to qualify to continue to receive my pensions ... ... is stay topside the grass! So - I have darn near a guaranteed income ... till the day of my death. Quite a comfortable position in which to operate, I figure. Sometimes I have some readily-available cash, sometimes not ... but that doesn't trouble me. I carry a credit card. If I have an emergency, I'll use the card to pay for whatever I need. I have a Line of Credit, fully secured by mutual fund and stock certificates, that sits unused, most of the time. There was no set-up fee, and there is no maintenance fee if I let it lie unused. Its main purpose is to use when it suits me to purchase investments, if I lack the cash at the time. If I were to use it for funds to be be used in an emergency, most of the uses being not deductible, I would set up a separate line of credit, having certificates issued as needed, to provide the security, so that I have one fund for deductible situations, one for non-deductible emergency use. When I receive my account next month from the credit card agency for the amount owing, I draw a sufficient amount from the non-deductible line of credit to pay that amount in full, thus avoiding interest cost re the credit card. Interest on the line of credit now is 5.25% ... and I'd try to pay it off from current income as quickly as possible. And leave the line of credit that I use for purchase of investments, making the interest cost deductible, uncontaminated by a loan used for non-deductible purposes. Also, I feel comfortable, as I approach age 80, at carrying 80% of my assets in equities. As you know, the stock markets are down, now. Suppose I have an emergency develop tomorrow that requires a substantial amount of expense. Would I sell some of my equities, probably at a lower price than they usually run? Sometimes some of the market is down and other parts are operating at approximately their usual levels. If there were some parts that I might consider to be not undervalued, I might liquidate some of them. But probably I would not. I might liquidate some mutual funds, as I have grown increasingly unhappy with them over recent years. If I sell some stocks, there's the commission to sell them. Then, if there's been a capital gain, I must pay the income tax people a portion of that gain, next year. Then, when I accumulate funds to purchase more stocks, there's commission to pay once more on my purchase. When one considers those costs, often its wiser just to initiate a temporary loan to deal with the emergency. Not only that ... it has been my experience that, after a period when stock markets were undervalued, when the recovery takes place, there is substantial increase in value within a year or two or three following that low market period. I would very likely make a loan, pay it off in part over the intervening period and liquidate some assets as needed after the recovery in order to discharge that loan. If I can make 25% more on an sale of an asset over a couple or three years ... I don't mind paying 5.25% annual interest. I don't have large worry over medical and hospital costs ... if I were a U.S. resident, with higher potential medical and hospital care costs, I might evaluate the situation differently: but possibly not much differently, even so. I hope that you've found this explanation understandable ... and interesting. I am interested to hear your comments. I hope that you are enjoying this beautiful spring weekend ... my multiple-trumpet daffodils are out! ole joyful P.S. If you use this idea and it earns you, say, $300. ... you owe me 10%, right? o j

You need an account with a stock brokerage firm who will buy and sell stocks for you. If you do not want advice from the firm, you can use a discount service, which charges less per transaction. You need an easy means of transferring money from where you have it into that account - and, of course, back! It's simplest if you can make that transfer electronically. Many people start with a "cash account", allowing the owner to buy and sell online, using pin numbers, of course. I won't do that, for I use an old computer and fear that it may be infected with a spy that may transmit information to its boss that I don't want him (surely not "her"!) to know. I can call the discount broker on the phone, my discount brokerage allowing me to make the transaction by keying numbers on the phone. Being an old fart, I pay some more per transaction to talk to a broker to make the orders. The financial institution where you hold your money may have a preferred broker with whom they connect, but usually they can relate to various brokers equally easily. My discount broker account is held with one that is owned by a bank where I have an account, so transferring money back and forth is very simply done. With a "cash account", usually the official documentation is held in the brokerage database and they send you a report regularly, usually monthly or quarterly, giving details of the cash and stocks that you have, with current value. You can buy stocks with the total cost, plus commission, being no more than the cash balance that yuu have in your account. Some investors want to have the shares that they own issued in certificate form, which usually costs $35 - 50. per transaction, in Canada. One reason for this may be that they wish to use the certificate as collateral for a loan at a financial institution. You can have a "margin account" with the stockbroker that allows you to borrow from them to buy more stocks, and in this area they usually charge about 1% more interest rate than borrowing from a bank. If you're not familiar with the operation of the stock market, it's likely a good idea to avoid borrowing until you become quite familiar with how that system works. Otherwise, if you borrow a little too much, and the market goes down, you don't have enough collateral to cover the amount of your loan. The lender will want either: 1. more share certificates, carrying enough value to more than cover the amount of the shortage, or 2. enough cash to make up the difference. If you have given them $10,000. worth of stock, most will lend about $5,000. If the value of the underlying stocks drops to, say, $8,000., they'll be willing to lend only $4,000. So they want more stocks carrying a minimum of $2,000. value to bring the collateral level back to $10,000. But they usually ask for some more, in order to have some cushion there, in case of some more reduction in value, which would require them to call you asking for more collateral. Or if you pay them $1,000. cash (probably more like $1,200. - 1,500.) that will satisfy the shortage ... and leave a little extra, in case of need. And - they want the extra collateral ... or cash ... by later today, tomorrow at the latest. I don't like getting margin calls ... and when I ran a personal financial advisory business, I sure as heck didn't want my clients getting any (unless they were fully familiar with the system and able to take care of any problems, immediately ... and don't go on vacation, in case the market drops 15% or so, as it has in the past week)! There may be variations in the way that the system works in the U.S., and I hope that folks from the U.S. will inform you of such differences. Good wishes for increasingly skillful investing. ole joyful

At age close to 80, living on less than my pensions, my assets are about 80% in stocks ... and I bought some more, a couple of weeks ago. I wasn't watching on Mon., but if I had would likely have bought something solid. Go to "Yahoo", click on "Finance", at top left there's a box labelled, "Get quotes", enter "BRK-B", then click on the box. You'll get a repoort of the open, high, low and close of the smaller Berkshire-Hathaway stock for the latest day, with current and average volume, and there's a chart of the price progression during the latest day on the right. Under the chart box, click on "6m" or "1 y" to find chart showing closing prices, daily or 3 days, for the recent 6 months or 1 year. If you'd like to see the price action during those days, above the chart there's a choice of "Bar" (which click on) or "Line" (or another for candlestick). Or try "JNJ" or "BAC" (Bank America). Or try "TD.TO" (Canadian bank, TD Canada Trust) or "ABX.TO" (Barrick Gold) or "ENB.TO" (Enbridge) or "TRP.TO" pipelines, "ECA.TO" (EnCana -natural gas), "NXY.TO" (Nexen - petroleum), "POT" (potash, a major fertilizer), all but the first are major resource providers, plus giving you some assets based in non-U.S. dollars. But - if the U.S. economy gets a cold, the Canadian one usually gets pneumonia. However, those resources are sought in many parts of the world. If you'd like to see a list of open, high, low and close, plus volume, and dividend rates (for some) click on "Historical prices" near top left. What's better than putting your money into the bank? Buying the bank! Let others' money work for you. Good wishes for wise use of your resources. ole joyful