what-type-of-cd-should-you-buy2

This is for my American friends. The ones who got scared into keeping money in cash and out of the market 🙂
(In Canada, we have things like GICs and Term Deposits, none of this CD stuff.)

It used to be that when you bought a certificate of deposit (CD), you didn’t have a lot of choices. It was a simple decision. Nowadays, even with a basic CD you have to do some homework. It’s still a pretty conservative investing technique, if it can be called that…

Regular CD

To start with, there is the regular CD that has been around for many years. Even so, there is a lot to learn about plain vanilla traditional CD’s. First, you need to shop around for rates. Then, figure out if flexibility is important to you. With a shorter term, for example, 6 months, you can access your funds sooner, but a 3-year CD is likely to give you a higher yield. Though not always! I’ve seen shorter term products offered at better rates. My guess is that happens when a particular bank is strapped for cash, or they’re just trying to drum up some new business.

You need to also consider whether the interest rates are going up or down in the future. If they go down, then a long-term CD is more advantageous, while if they go up you want to be able to get your money back quickly to take advantage of the rise. There are techniques you can use to balance off short-term versus long-term investment, such as laddering and barbells. (I’ve done Ladders and Bullets with term deposits. It’s ok. Makes you feel busy and smart, doesn’t necessarily produce great results.)

Brokered CD

If you are looking to have access to your money at any time and are still looking for the security a CD offers, then you may want to consider a brokered CD. This is a CD that you can sell at any time on the open market provided there are buyers – just like you would sell a stock or bond. The way these work is that the broker buys a large CD from a bank, and then breaks it up into a number of smaller brokered CDs which it sells to its clients. The interest rate is typically lower than you would get on a regular CD, but this is offset by the flexibility it provides.

Market-Linked CD

Finally, you may want to consider buying a market-linked CD, which gives you a fixed return like a traditional CD, but also gives additional returns linked to stock market growth. You can’t lose money if the stock market goes down, so in some ways this is a win-only proposition. However, before you invest in this type of CD, you really need to get professional advice from an unbiased expert, since there can be significant issues around tax treatment, and the FDIC protection may only apply to the capital you invest initially, not to any gains you may make.

In my nearly 15 years in Toronto I had never visited Buffalo, NY. Yesterday I took a friend to the airport and stayed there for the day to shop. I was always very skeptical about outlet malls because the ones I’ve been to in Missouri and Ontario weren’t worth it. But Fashion Outlet Malls in Buffalo had me “oh-my-godding” every 10 seconds. I was ‘operating’ on 3 hours of sleep and even in this handicapped condition I was able to find a few amazing things at a huge discount. If this were a girly blog, I’d take pictures of the deals I got 🙂

Another mall, Walden Galleria was fine but it’s not exactly an outlet mall. Their brands are nearly identical to what I can find in Toronto with only a few exceptions. Prices overall weren’t much lower, but I think many people go to Walden for The Cheesecake Factory. Their cakes were good.

I’ve read somewhere that Coach ((COH: 48.74 +1.37%)) makes more money at their outlet stores than full-price stores. Can’t find the source but I believe it – their place was a sh*t-show, a horde of people were running around the store with a mad look in their eyes, and that’s on Thursday. Can’t imagine what it’s like on a weekend.

All in all, I thought it was worth the trip, and will probably do it again at some point.

geckoThis will be old new for some…

I’m selling my unlocked cell phone on eBay where I came across this warning:

Due to a recent change in US law, eBay sellers can no longer sell unlocked cell phones unless they were unlocked by the manufacturer or unlocked prior to January 26, 2013. There are also restrictions on unlocked phones sold before the carrier contract expires.

Turns out, it is now illegal to unlock carrier phones in the US. A bunch of corporations lobbied their interests and made this into a LAW, can you believe it? Unlocking a phone will be considered a violation of copyright law – specifically, subsections concerning circumventing DRM (digital rights management).

I always felt that unlocking phones had a somewhat borderline criminal vibe about it, but then it was MY phone I was hacking, wasn’t it? When it comes down to it, when buying anything with software, we agree to the Terms and Conditions that are never read, and it may turn out that we don’t even own the phone.

Wonder if Canada will pass the same law. And will Craigslist follow Ebay’s example?

Today’s chainmail, no idea how reliable it is, obviously, but I’m going to copy/paste it in its entirety.

I don’t know what you guys are paying for gasoline…. but here in California we are paying up to $3.75 to $4.10 per gallon. My line of work is in petroleum for about 31 years now, so here are some tricks to get more of your money’s worth for every gallon:

Here at the Kinder Morgan Pipeline where I work in San Jose , CA we deliver about 4 million gallons in a 24-hour period thru the pipeline. One day is diesel the next day is jet fuel, and gasoline, regular and premium grades. We have 34-storage tanks here with a total capacity of 16,800,000 gallons.

Only buy or fill up your car or truck in the early morning when the ground temperature is still cold. Remember that all service stations have their storage tanks buried below ground. The colder the ground the more dense the gasoline, when it gets warmer gasoline expands, so buying in the afternoon or in the evening… your gallon is not exactly a gallon. In the petroleum business, the specific gravity and the temperature of the gasoline, diesel and jet fuel, ethanol and other petroleum products plays an important role.

A 1-degree rise in temperature is a big deal for this business. But the service stations do not have temperature compensation at the pumps.

When you’re filling up do not squeeze the trigger of the nozzle to a fast mode. If you look you will see that the trigger has three (3) stages: low, middle, and high.You should be pumping on low mode, thereby minimizing the vapors that are created while you are pumping. All hoses at the pump have a vapor return. If you are pumping on the fast rate, some of the liquid that goes to your tank becomes vapor. Those vapors are being sucked up and back into the underground storage tank so you’re getting less worth for your money.

One of the most important tips is to fill up when your gas tank is HALF FULL. The reason for this is the more gas you have in your tank the less air occupying its empty space. Gasoline evaporates faster than you can imagine. Gasoline storage tanks have an internal floating roof. This roof serves as zero clearance between the gas and the atmosphere, so it minimizes the evaporation. Unlike service stations, here where I work, every truck that we load is temperature compensated so that every gallon is actually the exact amount.

Another reminder, if there is a gasoline truck pumping into the storage tanks when you stop to buy gas, DO NOT fill up; most likely the gasoline is being stirred up as the gas is being delivered, and you might pick up some of the dirt that normally settles on the bottom.

For those of you who want to, subscribe to the National Post for 3 months, for free: link.

I can’t deal with the newspaper sales people after the trial runs out. They’re the most annoying and persistent bunch. Good luck if you decide to take this free cheese.