The Trouble with Public Colleges and State Universities

At the 50,000-student University of Florida, only 50 or so undergrads major in geology.

Pretty key things in this era of climate change, especially in a coastal wetlands state like Florida. But Perfit's department may soon be unable to offer so many courses to non-majors. UF fears severe state budget cuts in May and has warned that it may have to lay off half the geology faculty.

Record applications. Soaring tuition. Tighter budgets. State U. may no longer be as great a deal or as easy a backup as it once was. Parents and kids, time to rethink your strategy.

Peter Laumann, a UF senior active in a student group protesting the cuts, says some of his instructors have asked students to stop submitting papers by e-mail.

But now, just when families most need low-cost, high-quality schools, State U. is under intense financial pressure. Arizona State University will be charging a temporary $510 annual surcharge over tuition to get it through the recession (see editor's note).The University of Washington is bracing for a 26% cut in state money, bringing funding back to where it was a decade ago. Meanwhile, families searching for a bargain have deluged some of the better public schools with applications, making them even more selective.

Their average resident tuition of $6,600, or even the $17,500 charged to nonresidents, still pales in comparison to the average $25,000 at the privates.

If you want to make sure your child gets into a great school, and that you can afford to pay the bill when she does, you're going to have to rethink your game plan.

 

Sources:

By Pat Regnier, Money Magazine assistant managing editor
CNNMoney

More on this article...

Senate Approves Measure to Reduce Home Foreclosures

The Senate on Wednesday approved a bill that would expand federal efforts to prevent mortgage foreclosures, shield mortgage service companies from lawsuits if they participate in federal loan modification programs, and give renters of foreclosed properties at least 90 days’ notice before eviction.

The bill’s other provisions would make it easier to modify loans and give renters at least 90 days’ notice before being evicted.

The Senate bill, however, did not include Democrats’ most ambitious proposal to aid troubled homeowners: a provision that would have allowed bankruptcy judges to modify the terms of primary mortgages.

The new Senate bill does not include additional money to aid mortgage borrowers, but it does draw $2.3 billion from the Treasury’s $700 billion financial bailout fund for various provisions. The bill also would increase the borrowing authority for the Federal Deposit Insurance Corporation to $100 billion from $30 billion, a move that will save banks billions of dollars by reducing the extra premiums that they would have had to pay to shore up the deposit insurance fund.

“The bill does other things, but certainly, a major target is to deal with peoples’ housing issues and try to stem the tide.” Senator Jack Reed, Democrat of Rhode Island, a main proponent of the bill, had a strong role in the homeless prevention provisions and others that would give the Treasury secretary more latitude in deciding when to use taxpayer money to buy stock in financial institutions receiving bailout assistance.

The Senate bill would provide $2.2 billion for homelessness assistance and up to $440 million for prevention.

 

Sources

By DAVID M. HERSZENHORN
NYT

Read detail

More on this article...

Money Management - Personal Finance Tips For All Ages

Young people get a bad reputation in society these days. Actually, the concept of blaming ills on younger adults is nothing new. Certainly the non-conformist generation of the 1960’s got their fair share of bashing in their day. Nowadays, young adults contend with many stereotypes, some imagined, others that are real and are completely unique to their generation. One of the preconceptions is that they are not responsible with money. In a lot of cases, that notion is true.

Most college graduates leave school with an average of $20,000 worth of school loans saddled to them. Couple that figure with several more thousand from the numerous credit cards they’ve accepted and possibly even a car loan, and some college graduates can feel as though they’ve lost before they’ve even begun. Irresponsibility and indebtedness is common within younger generations, yet that fact doesn’t make the challenges that debt presents easier to deal with. There are, however, some very real ways to manage debt and to prevent falling back into it.

If young adults are already in debt, then the ship has already sailed on preventing themselves from getting into that trap. It is never too late, however to right the ship. Even though a person may be starting in a harder position, they can always learn from their experiences and add those experiences to their money management-personal finance knowledge.

It’s important to note that debt is necessary for most people and that not all debt is bad. For instance, lenders look upon student loans and mortgages favorably as positive debt if the account is in good standing. Credit cards, though useful at times, are the things that get most young people into trouble. Many credit card companies approach people as young as eighteen with credit card offers, often times on college campuses. If a parent or another guardian hasn’t properly taught a young person of the pitfalls of credit card debt, ignorance and irresponsibility could very well be causes that makes a young person indebted. There is no such thing as a free anything!

To prevent young adults from falling into poor money management habits, it’s important to give them money management-personal finance responsibilities early. In addition, an overall financial education is vital to a responsible view of how money flows through our global economy and how it affects their bank account. For instance, opening a low balance checking account, requiring them to get a job and budget and save income can be key learning tools and a good foundation for young people. Fiscal responsibility is essential to understand how money functions as a tool in our society.

Once they’ve reached adulthood, encouraging young adults to continue to educate themselves about money management - personal finance becomes even more important. The doors that open to further indebtedness are just as vast as the doors that open to financial freedom. An understanding of money as a tool and a respect for it will help to make smarter, more financially savvy adults. It's also important to review that how you see money and wealth is a choice. What will happen is that financially savvy adults teach their children to be financially savvy, and it becomes a domino effect. Think of the doors that would open to so many more people if they chose financial freedom versus indebtedness.

Young adults can learn proper money management-personal finance techniques if they are taught early on in life and stay committed to those principles. Once a young person becomes independent, it’s easy for that newfound freedom to turn into irresponsible spending habits. Young people, with help and the proper money management strategies, can become responsible adult consumers and investors.

More on this article...

Bernanke Outlines the Future of Financial Regulation

Highlights from Fed chairman’s remarks to the Federal Reserve Bank of Chicago’s conference on bank structure and competition.

Ben S. Bernanke, the Federal Reserve chairman,  spoke today (via satellite) at the Federal Reserve Bank of Chicago’s 2009 Financial Structure Conference.

He primarily talked about the need for more than just supervisory “spot checks” — the need for private sector institutions, and the agencies that supervise them, to look at institutions as a whole, not just the individual branches of a given company; how companies interconnect with one another; the incentive structures for compensation; how companies would fare under various market conditions; and what the “possible unintended consequences” of “innovative” financial instruments (presumably things like credit-default swaps).

 

By Catherine Rampell
NYT
Read detail

More on this article...

Jobless At Lowest Level Since January

New applications for jobless benefits plunged to the lowest level in 14 weeks, a possible sign that the massive wave of layoffs has peaked.

The Labor Department reported Thursday that the number newly laid off workers applying for benefits dropped to 601,000 last week. That was far better than the rise to 635,000 claims that economists expected.

Decline of 34,000 in latest week a possible sign of easing job losses .

The four-week moving average of initial jobless claims, which smoothes out volatility, totaled 623,500 last week, a decrease of more than 30,000 from the high in early April.

In a separate report, the government said that productivity, the key ingredient to rising living standards, grew at a 0.8 percent annual rate in the January-March quarter, slightly better than the 0.6 percent increase that economists had expected. Wage pressures, as measured by unit labor costs, increased at a 3.3 percent rate, down from a 5.7 percent spike in the fourth quarter.

Regulators and economists are not worried about inflation since many workers are more concerned about keeping their jobs in the recession than demanding higher wages. Even with the big drop in new applications for jobless benefits last week, the claims remained at elevated levels. By comparison, weekly jobless claims totaled 372,00 a year ago.

They expect the jobless rate will keep rising through the rest of this year even if their forecasts for an end to the recession in the second half of 2009 are accurate.

Analysts expect the jobless rate will climb to 8.9 percent from the current 25-year high of 8.5 percent. Many analysts expect the jobless rate will hit 10 percent by the end of this year. The rise in continuing claims to 6.35 million was registered for the week ending April 25, the latest data available.

Among the states, Michigan saw the largest increase in claims with 9,998 more for the week ending April 25, which it attributed to more layoffs in the automobile industry, according to the Labor Department.

General Motors Corp. laid out a restructuring plan that includes cutting 21,000 U.S. factory jobs by next year. Microsoft Corp. said it was starting thousands of the 5,000 job cuts it announced in earlier this year and left the door open to even more layoffs. Chip maker Atmel Corp. last week said it would lay off 300 people, or 5 percent of its work force.

 

Sources:

MSNBC.com

More on this article...