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Money

The www.FedPrimeRate.com Personal Finance Blog and Magazine

Thursday, September 24, 2009

I Spent $125 On A Pair of Sneakers, but I'm OK With It

Running SneakerI am currently without health insurance.

Very recently, I was experiencing some serious pain in my right Achilles tendon whenever I went out running. The pain started weeks ago, and gradually got worse over time. It got so bad that I had to stop running, and a developed a slight limp.

Being without insurance, I tried my best to see if I could fix this problem on my own. I visited webpage after webpage, from high profile sites like WebMD to small forums dedicated to running. I found all kinds of advice, but one recommendation stuck out as the best place for me to start. I found a forum where a doctor recommended to someone with the same symptoms (Achilles Tendonitis) to change his running shoes right away.

So, reluctantly, I went to my local mall to shop around for a pair of running shoes. This was not easy for me, as I go shopping for clothes and shoes once every 5 to 7 years. Moreover, I already had a perfectly fine pair of running sneaks at home.

I tried on countless shoes, but most were made for people who have an arch in their feet so they weren't any good for my extremely flat feet. Eventually, I found a pair of Nike MAXAIR running shoes that were perfect: light, comfy and not even a hint of an arch. They cost $125 plus tax, a price that actually made me sweat a little, but I bought them. The salesman assured me that I could return them if they did not work out.

So, after giving my tendon a few days rest, I was back to running in my new kicks. The pain subsided after a few runs and is now completely gone. I had no problem running with the diminishing pain, as, for me, it's even more painful to be without exercise. I simply don't function right without it. Keeps my body fit and strong and my mind sharp and resilient.

I used to tap into my "internal pharmacy" by biking a lot, but I had to give that up completely after I developed a pinched nerve in my neck. Though I love cycling, it doesn't suit my body type at all. And yes: I've tried lots of different bikes. Eventually, I'll give a recumbent bicycle another try, but for now, I'm sticking with the running.


Run Naturally: Don't Listen to Other People's Bad Advice

Many years ago, when I was a teenager in boarding school, my physical education teacher used to tell me that my running style is no good. When I run, I naturally lean forward, and with each step I land on the balls of my feet. For long distance runs, my gym teacher -- we'll call him Mr. WW -- used to try to get me (and others) to run more upright, which would cause me to land on my heels. I resisted his advise, because I never really trusted him, and his advise just didn't seem to make sense to me. He was from an era when runners would run very upright, and lifting the knees as high into the air as possible was considered good form.

Turns out I was right to trust my instincts.

A few months ago, I caught an excellent broadcast of Radio Times on NPR about running. Marty Moss-Coane interviewed Christopher McDougall, author of the book Born to Run. McDougall spent time with the Tarahumara Indians of Mexico’s treacherous Copper Canyons, a group with some astounding runners. These natural runners are able to do 100-mile ultramarathons barefoot by running exactly the way I run naturally: leaning forward and landing on the balls of their feet. Of course, these folks run at an easy pace, but I think most would agree that 100 miles is amazing at any pace.

For more on Born to Run, visit this link.

To listen to the Radio Times interview with Christopher McDougall, visit this link (mp3.) Highly recommended!

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Thursday, September 17, 2009

COBRA Subsidy Will Expire On December 31, 2009

COBRA Subsidy via The American Recovery and Reinvestment Act of 2009 (ARRA)If you've ever been laid off from a job, then you've probably heard of COBRA. COBRA is short for the Consolidated Omnibus Budget Reconciliation Act of 1985, a law that let's a recently unemployed worker extend the group health plan their employer provided for them for up to nine months.

COBRA was a good idea, but it practice it really doesn't help much. That's because the cost of using COBRA is just too high. I remember being asked to pay more than $400 to continue on my former employer's group plan back in 1999. I can only imagine what I'd be asked to pay if I wanted to use COBRA today.

The American Recovery and Reinvestment Act of 2009, or ARRA, which was signed into law by president Obama back in February of this year, includes help for those who want to use COBRA, in the form of a 65% premium reduction. 65% is a big deal. It can reduce a $400 COBRA premium down to a far more affordable $140.

Two important things to note about this subsidy:

  • Help comes in the form of a tax credit, so you'll still need to have enough cash available to pay for the full COBRA premium amount if and when you sign up for the program.

  • The subsidy ends on December 31, 2009.

For more info on the COBRA subsidy, visit this webpage.

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Friday, September 11, 2009

Poverty Rate Surged During 2008

povertyThe Commerce Department just released stats on poverty and health insurance coverage for 2008. As you might have guessed, the numbers for the wealthiest nation that has ever existed aren't pretty. Poverty rose last year, as did the number of Americans who don't have health insurance. Here's a clip from the U.S. Census Bureau report:

"...The U.S. Census Bureau announced today that real median household income in the United States fell 3.6 percent between 2007 and 2008, from $52,163 to $50,303. This breaks a string of three years of annual income increases and coincides with the recession that started in December 2007.

The nation’s official poverty rate in 2008 was 13.2 percent, up from 12.5 percent in 2007. There were 39.8 million people in poverty in 2008, up from 37.3 million in 2007.

Meanwhile, the number of people without health insurance coverage rose from 45.7 million in 2007 to 46.3 million in 2008, while the percentage remained unchanged at 15.4 percent..."

And how does the Commerce Department define poverty? Here you go:

"...As defined by the Office of Management and Budget and updated for inflation using the Consumer Price Index, the weighted average poverty threshold for a family of four in 2008 was $22,025; for a family of three, $17,163; for a family of two, $14,051; and for unrelated individuals, $10,991..."

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Monday, September 07, 2009

Money In Motion

The other night, I was both bored and restless, and feeling a bit burned out. So I decided to take a long walk with my camera and see if I could find interesting things and/or people to photograph.

Danny: Homeless but productive, cleaning drains keeping the bootyI was one block away from the Federal Reserve Bank of Philadelphia when I came across a group of homeless folks sitting on the sidewalk. One guy was very busy, working very hard scraping dirt from coins and other metallic objects. I stopped and asked him what he was doing. He introduced himself as Danny (pic to the left), and told me that he was recently homeless. He said that he made an arrangements with a friend of his who owns a local laundromat. Danny explained that his friend lets him stop by the laundromat every once in a while and collect whatever he can from the numerous washing machine drains, and Danny can keep whatever he finds. Danny told me that he finds tons of coins, from pennies to quarters, and often finds jewelry and other valuable items. He showed me a clutch of gold necklaces. He let me keep a very worn out penny.

Worn Out PennyAt this point, a small crowd formed around Danny, attracted by the bright flashes from my camera. One passerby asked Danny why he didn't simply wash all the items at once with water. Danny explained that he liked scrapping the coins on the ground. Kept him busy.

After chatting with Danny for a few minutes, I thanked him for his time and for letting me take a few pictures. I then walked over to the Philly Federal Reserve Bank. The bank was advertising a "Money in Motion" exhibit from a large banner at the corner of Arch and 7TH streets. Admission was free.

I was embarrassed for the Bank.

Here we have the most powerful central bank in the world, a bank that has been printing money out of thin air in an effort to "save the American economy," a bank that wants the world to believe that giving money away to people who have amassed much of their obscene wealth by figuring out ways to get very rich without providing useful goods or services, is the best way to extricate America from the Great Recession. I see "Money in Motion" and I think, "Hmmm, our central bank actually wants to show off how it helps the masters of greed who caused the financial crisis get even richer by sucking untold billions from taxpayers pockets. Hmmm...."

Many Americans know that the federal government spent hundreds of billions of dollars to bailout the insurance giant AIG. What many don't know -- because most mainstream media outlets don't want to go there -- is that the investment bank Goldman Sachs got about $12.9 billion from AIG's bailout bundle. Don't believe me? Read about it here. Just as sickening: foreign banks got billions of that bailout cash as well, including Barclays PLC, Societe Generale, and Deutsche Bank. Money in Motion, baby.

The AIG bailout was a crony capitalism, plain and simple. Goldman has never been a vital part of the American financial landscape. Without AIG's bailout money, Goldman would have taken a huge loss, but would have survived. Meanwhile, countless commercial banks, the ones that lend money to businesses and consumers and help keep Americans employed, are still failing at an alarming rate.

A laundromat owner -- someone who makes money by providing a useful service to her community -- lets a homeless guy clean out washing machine drains and keep whatever he finds: that's my idea of money in motion. It's honorable, civilized and far more American than any multi-billion dollar crony bailout.

Here's an idea: why doesn't the Philly Fed Bank open a small office that's open to the street where people like Danny can connect with business owners who are looking for simple services like cleaning laundromat drains or sweeping floors. They could call it the Informal Services Marketplace. Could help a lot of people who can't find work in the formal economy, or people with mental issues who aren't mentally fit enough to hold down a solid job. Criminal background checks would be mandatory, of course.

Homeless in Philadelphia
I'm glad I bumped into Danny that night. It's so easy to feel overwhelmed by an anemic and dwindling income, healthcare inflation and child support payments. It's good to get some real perspective every once in a while. Helps to rejuvenate the entrepreneurial spirit.

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