President Bush has allowed mortgage holders to switch to FHA insured mortgages. in addition one will not have to pay income tax on mortgage principal that is forgiven.  Here is another example of understanding accounting and the tax code to be able to explain transactions to the public.

As the article says, suppose the lender drops your mortgage to $250 K from $300K. You do not have to pay $50 K of the mortgage, it has been forgiven. This would normally require you to report $50K of income on your Form 1040 annual tax return.  You would pay your highest marginal tax rate times the $50K. If your rate was say 28% you would owe 50 x .28 or $14,000.  Now you will not owe it.

No doubt this will ‘brake’ some of the fear about an imploding market.  How successful borrowers will be at actually getting this done remains to be seen.

Now read Maria Bartoromo’s interviw the the CFC CEO.  ANgelo Mozilo says he didn’t realize values would be going down, maybe he should have been reading this blog!

Go to the Archive and click on 5/22/07 to see the list of certifications that the Tx St Board of Accountancy recognizes.

From the Helpful Website list I would direct you to

http://www.iia.org Cert Internal Auditor
http://www.imanet.org Cert Managerial Accountant

Both of the above are well recognized certifications and  bit easier than the CPA exam. I have material on reserve in the library that extensively explains the ritual of obtaining those certs.

And I have two of the four books in the Gleim series to study for the CPA exam on reserve.

I am also investigating another certification though it is certainly of less consequence at

http://www.acatcredentials.org

My point is that many of you had the goal of becoming a CPA, which is a good thing and an admirable goal. It would be a good idea to work up to the CPAexam by studying for a lesser exam and seeing how well you do there first. And one can never have too many certifications.  Gaining confidence on the CIA or CMA exams would certainly make it easier to take the CPA, and the study material is the same.

By the way, while you are resting, have you surfed some of the sites on Helpful Websites?

Check out my post on 8/9/07 about explaining your company in thirty seconds, there is a link to the article in INC magazine. This will help you with making an extemp speech about yourself!

For some ideas on your book reveiws you can go to

http://www.amazon.com and use the drop down box to pick books, on that page you can pick business and then you can even pick accounting

http://www.barnesandnoble.com allows the same thing, drill down to the business category

I will  also post some suggestions under handouts

dle

An article in The Economist  explains how former KGB operatives have come to run the country once again.  but they are tacticians,not problem solvers.  It used to be Us versus them in the Cold War with Western Europe conveniently hiding under our nuclear umbrella. Today the players in globalism might include

USA and Britain and Austrailia
Far East Korea Singapore Phillipines Japan Taiwan
Western Europe, the  Euro currency
Saudi Arabia and member states, OPEC
Iran Syria Pakistan and allies like
Russia
and India
and then there is China
And finally everyone else including Africa and South America

Gee this sure got a lot more complicate, no wonder the UN can’t get anything done.

I don’t understand how  this fellow is an enlisted man rather than an officer but he makes an interesting case for a WW II style draft.   

Force Protection  makes the kind of vehicles he is describing.

Dr. Elam,

I meant to tell you that what I have found in my limited experience of
going on business calls with executives and potential loan prospects is
this.
I’ve found the most important thing to these meeting is keeping up with
your current events. I’d venture to say that the majority, say 80% of
the conversation, is all current events-be it Michael Vick,
Mortgage/sub-prime dilemma, the DOW Jones, Dell, Longhorns, Aggies,
Baseball, Enron, etc. Most of any article in WSJ, BW, is normally the
topic of these meetings. I’d say the another 5% is talking typical
family business, trips, etc. Another 5% is talking/criticizing mutual
friends, and the last 10% is actual business that pertains to the loan
and the financials. This is the main reason why I visit your blog and
to show you that your style plays very much into the business roles
students will get in to. The business weekly is helping me
tremendously, not to mention, having a few books under my belt, is
never a bad thing.

Well thats just an observation I’ve made, but it seems to be right on
point. I might add that it feels great to know what you’re talking
about in these meetings when you’re opinion is asked for. I was
recently in a meeting with a Jr. Lender and his $2M customer. I was
present for meer support, should the lender have any concerns with the
statements, the customer presented. The customer made a comment about
the business of sub-prime loans and how “bad” a business it is to grant
such loans. I noticed the lender just nodded and said “yeah” in a not
so interested matter. Looking for some reply the customer turned to me
for some reaction. I looked at the lender and I saw that he knew
nothing of it. He basically said, “save me with his eyes.” I gathered
my thoughts and borrowed from BW by saying, “Well Sub-prime lending
isn’t necessarily bad business if the lender had done their homework on
the customer. It’s when the lender has recklessly abused their sub-
prime lending power, that they get in trouble.” I added some examples
of companies that abused their power and tied ethics into the whole
conversation. I could see the lender wanting me to change the subject
and prompt him back in where he was more comfortable with talking
ethics and he resumed the conversation.

Click here to learn about the Five Minute University!   In this day and age of on line learning, this idea could catch on…

Now, the reason I will be spending a lot of time in class connecting to that real world is to bridge just what Guido is talking about, hopefully you will remember more if we can connect the study to a reality.

We will be discussing ethics in all our classes this semester. This cloumn argues that you don’t help your friends be losers.   And that was Mike Vick’s failure.

Click here to learn about several previous Panics .  The history of financial panics did not begin wtih this generation and will occur again after wer are all gone. This is a good article that recounts the Panic of 1837 as well as J P Morgan  saving the day in 1907.  As you will see the lack of a Central Bank in 1907 made his
intervention necessary. And note that it was the re assurance of an accountant, Strong, who swung his decision to intervene.  Anyway this led to the creation of the third Central Bank for the US, now known as the FED.  The FED or course failed to avert 1929, 1957, 1973-74, 1987, 1998, or the current sub prime mess. So why does everyone count on the FED?  They are poor students of history!

Read and learn.

Here is an update on the latest FED effort to help out.   Hmm bending the rules, is anyone surprised?  Interestingly J P Morgan’s namesake bank is still in the thick of things…..

Come to think of it, click here to read how the FED was created in 1913.    Andrews Jackson dismantled wth first Central Bank in 1836 leading to the Panic of 1837.  We then operated under a Banking System after the Civil War but its lack of power led to three Panics during the Period.  The Panic of 1907 resulted ina  move to recreate a Central Bank now known as the FED.