Stocks That Are Better Than GoldIt's tough to beat gold. There's no better medal to win in the Olympics. For many people, there's no better component of jewelry. And when it comes to investing, quite a few folks think that other investments just aren't as safe or lucrative.
They're wrong.
You might think gold is safer because it's a tangible item that exists in limited quantities, and because piles of gold bars in a vault somewhere won't be worth nothing anytime soon. Think again.
After all, stocks are similarly tied to actual bricks-and-mortar companies. Alcoa (NYSE: AA) stock represents plants, employees, and technology that churn out aluminum and other products and services. Dell (Nasdaq: DELL) stock is tied to people, buildings, technology, and equipment to custom-assemble computers, among other things. It's not likely that those kinds of assets will suddenly become worthless, or that the demand for energy or medication will shrivel up. Great companies tend to hold their value.
Offers of easy credit are bad news for the poor | smh.com.au
It's "No credit check month" at Radio Rentals. If you go to its website, the first thing that greets you is a big sign assuring customers that they can apply for the lease of a plasma television, fitness equipment or "computers plus more" without having their credit record checked.
The company claims this isn't being irresponsible. What garbage.
Anybody who claims that this sort of behaviour is responsible or ethical is talking absolute twaddle. It is subprime greed writ small.
The irresponsibility of lending money without proper credit checks is underlined by the fact that other financial institutions have argued that the Federal Government should make more information on personal credit histories available to enable them to be more responsible lenders.
The sad thing is that "No credit check month" is not a one-off. It is a symptom of a wider problem, stretching beyond just one company. It represents a business model which is predicated on maximising profit by appealing to those doing it tough, that just a bit more debt might be the gateway to the good life.
A review by the Victorian Government estimated the total amount of credit lent by the small loans industry at between $50 million and $100 million a year in Victoria alone. Many small lenders and lease companies specifically design their products to fall outside existing credit regulations.
Organisations such as Radio Rentals claim that they run the risk of the loss if the client is not able to repay the loan or keep up payments on the lease. But the loss encountered by the company is small compared to the financial, emotional and social loss of those who enter an unsustainable debt spiral because of irresponsible lending practices by those who should know better.
Radio Rentals may bear a loss in the event of a default even though the business model of such firms means that they will have the original asset returned to them. But the executives of Radio Rentals won't have to explain to their children why debt collectors and sheriffs are at their door when the debt spirals out of control.
Yes, debtors need to show some personal responsibility. But corporate lenders need to show some responsibility as well. As an MP, I see the results of this sort of irresponsible lending. And the financial counsellors attached to churches and organisations such as Lifeline see it more acutely every day.
The Radio Rentals chief executive said it was important that people with poor credit histories have the ability to acquire things such as washing machines and refrigerators. This argument might hold a small amount of water. But it doesn't apply to fitness equipment, game consoles, plasma TVs and the other goods you are tempted with on the website.
Advertising like "No credit checks" specifically and deliberately appeals to the vulnerable in society, who would not be able to find credit from more responsible lenders. It is predatory lending.
The transfer of credit regulation to the Federal Government does provide an opportunity for a more consistent and rational approach to the laws governing lending in Australia including, for the first time, a national responsible lending obligation imposed on all lenders.
The Minister for Corporate Law, Nick Sherry, is basing his plans on world's best practice legislation. But we know that even the best legislation in the world will have its limits. Lenders determined to be irresponsible will find ways around restrictions.
We need stronger legislation. But we also need to condemn those businesses that go out of their way to prey on those on who can least afford it, who skirt around the law and seem not to care about the consequences of their actions.
These days, corporate responsibility is quite fashionable. The Corporate Responsibility Index says this is achieved "when a business adapts all of its practices to ensure that it operates in ways that meet, or exceed, the ethical, legal, commercial and public expectations that society has of business".
Businesses which gear their business model to lending more to people who already have too much debt will need to have a good long look in the mirror before they come anywhere near being regarded as good corporate citizens. (Chris Bowen)
Exposed: home brand deception - National - smh.com.au
COLES will overhaul its food branding and change its labelling claims in the face of mounting criticism from consumers and health experts over alleged misleading and unethical practices.
The giant supermarket chain has spent more than two years defending its SmartBuy and You'll Love Coles logos against allegations of piggy-backing off the Australian Heart Foundation's well-known heart tick symbol - and possibly duping consumers in the process.
Yesterday, the day after the Herald notified Coles it was planning to publish an analysis of the supermarket's generic brand food products and labelling practices, the company said it was gradually phasing out its trademark tick, an exercise that could cost the company tens of millions of dollars.
The company denied it was removing the tick as a response to customer complaints or public pressure.
"[The logo] never intended to imply that the products are endorsed by the Heart Foundation, and we don't believe it conveys that impression," a Coles spokesman, Jim Cooper, said.
"However, under the new Coles management team our house-brand imagery is being progressively redesigned, and the tick will not be part of the new packaging."
The Herald's analysis found that many of the budget-priced SmartBuy foods featuring the prominent red tick on a white circular background (as opposed to the foundation's white tick on a red circular background) had significantly higher levels of saturated fats, and in some cases higher levels of dangerous trans fatty acids, than their pricier You'll Love Coles shelfmates.
In the case of hamburger patties there were 20 per cent more saturated fats in the SmartBuy product, while in the two Coles home-branded peanut butters, the cheaper product had almost 70 per cent more saturated fat.
At Woolworths stores, where far fewer Home Brand products compete with the retailer's more upmarket Select brand, the difference in saturated fat content in the few products that were comparable was less marked. The exception was a canola-based margarine with double the saturated fat content.
Moreover, Coles brands of canola and vegetable oil which use a second logo (a red heart-shaped symbol similar to the Heart Foundation's logo) to promote the products' "cholesterol free" properties actually raise cholesterol levels when consumed, due to the exceptionally high level of trans fats in the products.
