The scope and coverage of bank loans vary from lender to lender. Most lenders have strict terms governing the loan proceeds. Depending on need, borrowers can consider the following dedicated loans:
Business Loans:
These loans may be long-term for funding asset procurement or short-term for financing working capital requirements. Startup entrepreneurs may be required to offer collateral. Moreover, borrowers are asked to present a business plan to become eligible for such loans.
Student Loans:
These loans are intended for funding higher education in the absence of scholarships and grants. Initially, student loans only covered tuition. Currently, education loans cover other expenses pertinent to a college education, including accommodation, books and supplies. Student loans in the US are offered by private financial institutions, as well as the US federal government. The latter accompanies lower interest rates and flexible repayment terms.
Home Loans:
These are long-term loans, with repayment periods as high as 30 years. The interest rate on such loans may be fixed or adjustable, varying according to the financial market. A borrower may also opt for balloon rate home loans, where interest rates are very low for 7-10 years of the loan duration, after which they have to repay the entire loan balance at once.
Car Loans:
These loans may be acquired to purchase new or used cars. The average payment duration on a car loan is usually five years. Most car loans are unsecured, since the vehicle itself is put up as collateral and may be repossessed should the borrower fail to meet loan payments.
Finally, one may consider applying for a cash loan, if they do not fit into the following categories. However, note that cash loans have extremely high interest rates and must only be used as a last resort to fund short-term credit needs.
Saturday, April 24, 2010
Asia Pacific Economy: Country Outlook
Australia:
Boosted with a fiscal stimulus, the Australian economy, especially the services sectors, are showing signs of recovery. While the nation’s economy is not facing any contraction, experts believe recovery may not be strong. Some key sectors such as housing, automobiles, and industrial equipment received boost from the fiscal stimulus. The real boost, however, is predicted to come from exports to China. With Australia’s key trading partners expected to grow strongly in 2010, rising investments in commodities and natural resource projects are expected to fuel Australia’s recovery. Australia’s public debt is 14% of its GDP. Although Australia’s economy is in good shape than before, businesses are still cautious and may remain so till 2Q 2010. A strengthening Australian Dollar and possibility of further hikes in rates by the Reserve Bank of Australia (RBA) shall also influence the overall economy.
China:
Growth in China accelerated during 2H 2009 and the nation’s economy is on the rise. Industrial production increased at 10.3% in 2009. 2010 promises to be a good year for China. The Purchasing Managers Index (PMI) increased to 56.6 in December 2009 from 55.2 in November 2009. The PMI surge covered all industries. The National Bureau of Statistics reported an improvement in the quarterly business climate index in China. The index grew to 130.6 in 4Q 2009 from 124.4 in 3Q 2009. The Chinese economy is likely to outperform other global economies riding on increasing domestic consumption and recovery in exports. However, to realize its 2010 vision, China must tackle credit expansion and industrial overcapacity.
Japan:
Japan’s economic outlook for 2010 is still plagued by high unemployment rate and deflation. Japan’s dependency on exports may well lead the nation into a sustainable growth from the fragile recovery it witnessed in 2Q 2009 and 3Q 2009. The PMI for December 2009 rose to 53.8 from 52.8 in November 2009, a decent recovery. Sustainable recovery, however, depends on the exchange rate as well. Yen has strengthened considerably against most major currencies. Japan also needs to control public debt, which is currently nearing 200% of its GDP.
Boosted with a fiscal stimulus, the Australian economy, especially the services sectors, are showing signs of recovery. While the nation’s economy is not facing any contraction, experts believe recovery may not be strong. Some key sectors such as housing, automobiles, and industrial equipment received boost from the fiscal stimulus. The real boost, however, is predicted to come from exports to China. With Australia’s key trading partners expected to grow strongly in 2010, rising investments in commodities and natural resource projects are expected to fuel Australia’s recovery. Australia’s public debt is 14% of its GDP. Although Australia’s economy is in good shape than before, businesses are still cautious and may remain so till 2Q 2010. A strengthening Australian Dollar and possibility of further hikes in rates by the Reserve Bank of Australia (RBA) shall also influence the overall economy.
China:
Growth in China accelerated during 2H 2009 and the nation’s economy is on the rise. Industrial production increased at 10.3% in 2009. 2010 promises to be a good year for China. The Purchasing Managers Index (PMI) increased to 56.6 in December 2009 from 55.2 in November 2009. The PMI surge covered all industries. The National Bureau of Statistics reported an improvement in the quarterly business climate index in China. The index grew to 130.6 in 4Q 2009 from 124.4 in 3Q 2009. The Chinese economy is likely to outperform other global economies riding on increasing domestic consumption and recovery in exports. However, to realize its 2010 vision, China must tackle credit expansion and industrial overcapacity.
Japan:
Japan’s economic outlook for 2010 is still plagued by high unemployment rate and deflation. Japan’s dependency on exports may well lead the nation into a sustainable growth from the fragile recovery it witnessed in 2Q 2009 and 3Q 2009. The PMI for December 2009 rose to 53.8 from 52.8 in November 2009, a decent recovery. Sustainable recovery, however, depends on the exchange rate as well. Yen has strengthened considerably against most major currencies. Japan also needs to control public debt, which is currently nearing 200% of its GDP.
Asia Pacific Economy
Asia Pacific or APAC region is situated near the western Pacific Ocean. The region includes East Asia, South East Asia, Australasia and Oceania. The Asia Pacific region consists of countries such as Australia, People’s Republic of China, Hong Kong, Macau, Indonesia, Japan, South Korea, Malaysia, New Zealand, Singapore, Thailand, Taiwan, Philippines and Vietnam. India and Russia are sometimes included in this region. The population in APAC is more than 3.6 billion.
The Asia Pacific economy is showing signs of recovery from the global recession with a surge in exports in India and China, and Thailand displaying improved resilience on the political and economic fronts.
The Asia Pacific economy is showing signs of recovery from the global recession with a surge in exports in India and China, and Thailand displaying improved resilience on the political and economic fronts.
Banking & The Banking Industry
Banking & The Banking Industry
The Banking Industry was once a simple and reliable business that took deposits from investors at a lower interest rate and loaned it out to borrowers at a higher rate.
However deregulation and technology led to a revolution in the Banking Industry that saw it transformed. Banks have become global industrial powerhouses that have created ever more complex products that use risk and securitisation in models that only PhD students can understand. Through technology development, banking services have become available 24 hours a day, 365 days a week, through ATMs, at online bankings, and in electronically enabled exchanges where everything from stocks to currency futures contracts can be traded .
The Banking Industry at its core provides access to credit. In the lenders case, this includes access to their own savings and investments, and interest payments on those amounts. In the case of borrowers, it includes access to loans for the creditworthy, at a competitive interest rate.
Banking services include transactional services, such as verification of account details, account balance details and the transfer of funds, as well as advisory services, that help individuals and institutions to properly plan and manage their finances. Online banking channels have become key in the last 10 years.
The collapse of the Banking Industry in the Financial Crisis, however, means that some of the more extreme risk-taking and complex securitisation activities that banks increasingly engaged in since 2000 will be limited and carefully watched, to ensure that there is not another banking system meltdown in the future.
The Banking Industry was once a simple and reliable business that took deposits from investors at a lower interest rate and loaned it out to borrowers at a higher rate.
However deregulation and technology led to a revolution in the Banking Industry that saw it transformed. Banks have become global industrial powerhouses that have created ever more complex products that use risk and securitisation in models that only PhD students can understand. Through technology development, banking services have become available 24 hours a day, 365 days a week, through ATMs, at online bankings, and in electronically enabled exchanges where everything from stocks to currency futures contracts can be traded .
The Banking Industry at its core provides access to credit. In the lenders case, this includes access to their own savings and investments, and interest payments on those amounts. In the case of borrowers, it includes access to loans for the creditworthy, at a competitive interest rate.
Banking services include transactional services, such as verification of account details, account balance details and the transfer of funds, as well as advisory services, that help individuals and institutions to properly plan and manage their finances. Online banking channels have become key in the last 10 years.
The collapse of the Banking Industry in the Financial Crisis, however, means that some of the more extreme risk-taking and complex securitisation activities that banks increasingly engaged in since 2000 will be limited and carefully watched, to ensure that there is not another banking system meltdown in the future.
How to Find Information about Bank Interest Rates
Here are some reliable websites where buyers can find the latest information on bank interest rates:
Bankrate.com is a website that provides comprehensive information on interest rates for various financial products like savings accounts, CDs, loans, mortgages and credit cards.
Bankaholic.com is another site that contains data and necessary information about interest rates in the US banks. It lets users search and compare interest rates for CDs, savings accounts and money market accounts spanning various financial institutions.
Another site called Moneyaisle.com enables participating financial institutions to bid and offer the best rates. As the live auction takes off, users can watch these bidding rounds and choose the institution that he/she wants to invest in.
Bankrate.com is a website that provides comprehensive information on interest rates for various financial products like savings accounts, CDs, loans, mortgages and credit cards.
Bankaholic.com is another site that contains data and necessary information about interest rates in the US banks. It lets users search and compare interest rates for CDs, savings accounts and money market accounts spanning various financial institutions.
Another site called Moneyaisle.com enables participating financial institutions to bid and offer the best rates. As the live auction takes off, users can watch these bidding rounds and choose the institution that he/she wants to invest in.
Sunday, October 11, 2009
Mapping the Trade Selection Process
The process of trading needs to start well before you focus in on the right side of a chart. Before you can take an overview, and focus on set-ups and signals, you need to have an ordered process where you are assured a market’s direction, and be able to quantify any directional shift which may have occurred since you were last on the screen. Something I heard a long time ago that I now know to be true, is the human brain is going to start to experience difficulty somewhere around the 5th or 6th simultaneous operation. Something else I’ve learned is that the brain can better serve us when we slow down and allow it to provide us with definition before we make an actionable decision.
Along with being able to project, the mind is an effective play-back device, which every now and again pauses in the now. As important as past price history is to the market and your own past is to you, and as influential as all the news events are, and your own expectations and aspirations, you have to have a process in place, where your decisions are based only on where the market is now. The chart below shows the flow of the decision making process which we will be teaching at trading-u.com.
The process of trade selection ends in one occurrence, a trigger, and one decision: yes, or no? Before it can come to that question though the trigger type needs to be categorized. For us it’s either trend, or a counter-trend. For “trend” let’s say there are 2 types of trend triggers, and for counter-trend triggers 4. Once the trigger is defined there is one last refinement before the trade is entered. There are 2 determinants based on a market’s stance, and momentum, where we would not take a signal. If the trade in consideration is not disqualified by one of those, the trade is entered.
In this process from “Overview” to “Enter Trade” we had 4 steps where the last two needed refinement. Keep in mind a step is not a decision, and a refinement is a definition. It’s interesting that for a “counter-trend trigger”, there are 4 definitions — no wonder 70% of counter-trend trades turn out to be losers when managed as trend trades.
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