Kingsize mortgage

DEFAULT PROBABILITIES

admin — Mon, 29 Mar 2010 13:39:04 +0000

There is a dearth of useful public information about delinquency and recovery rates of loans made by banks in most countries. The lack of such information in the public domain makes life difficult for analysts. There are a number of potential sources for data on historic credit default rates: credit rating agencies, central banks, other external information providers and banking associations. The availability and usefulness of such data vary considerably between countries.

Joint Tenancy

admin — Tue, 23 Jun 2009 20:37:51 +0000

Joint tenancy has been a popular way to own property primarily because it is a way to transfer property. It is one way in which two or more people can own real property together. Perhaps the popularity has been due to a large extent to a lack of knowledge of the disadvantages.
The outstanding characteristic of joint tenancy is that when one joint tenant dies, ownership passes to the surviving joint tenant or tenants. Usually it is a husband and wife who are joint tenants, but unrelated persons may be joint tenants. It is sometimes desirable for married couples to own checking accounts and motor vehicles as joint tenants in order for the surviving spouse to have prompt access to those items during settlement of the estate.
Advantages
• Fewer court proceedings are needed to clear up the survivor’s rights. Usually less time and costs are involved in proceedings to terminate a joint tenancy than in a probate. The proceedings to terminate joint tenancy between spouses have been reduced even further. The surviving spouse may obtain a merchantable title to real property in joint tenancy with rights of survivorship by filing the following documents with the County Clerk, as provided by Title 58 O.S., Section 912.
1. A certified copy of the death certificate.
2. An affidavit by the surviving joint tenant stating that the decedent named in such certificate is one and the same person as the joint tenant named in a previously recorded document by book and page where recorded.
The document itself satisfies this requirement as to recording information.
3. If property is held in joint tenancy other than only with the spouse, a waiver or release by the Oklahoma Tax
Commission of their estate tax lien must also be filed.
• It is easy to create a joint tenancy. Usually executing a deed naming all the parties is necessary, but the courts have been strict in requiring language to show that the grantor intended a joint tenancy and not tenancy-in-common. Use of the words “and/or” alone is insufficient to create a joint tenancy.
Disadvantages
• Very few farmers own all property in joint tenancy; therefore, if probate proceedings are required for part of the estate, much of the advantage of simplified legal proceedings is gone.
• Gift and estate taxes may be higher when property is held in joint tenancy than when property is held in one person’s name. For example, if a widowed mother puts her farm in joint tenancy with her son, a gift tax may have to be paid if the value of the child’s half interest is great enough. Then, when one joint tenant dies, the entire value of the farm may be subject to both federal and state estate taxes. However, the value may be reduced by the amount that the executor can prove was furnished by the surviving joint tenant in acquiring the property but contribution to the purchase price is sometimes difficult to prove. This may be costly. The marital deduction avoids this problem in cases where the joint tenants are married to each other. Once parents transfer property to a child in joint tenancy, they cannot change their minds. An individual may change his will at anytime.
• The child could sell his interest to the farm if he so desired.
• The joint tenancy can be severed by a judgment creditor proceeding against the land belonging to the joint tenant against whom he has had judgment.
• A parent holding title to property in joint tenancy with several children might have difficulty in mortgaging the property.
• The right of survivorship may create unfair distributional results. For example, if a widow or widower remarries,
places inherited property in joint tenancy with the new spouse, and dies before the new spouse, children may be disinherited. The property would belong to the surviving joint tenant and will eventually go to the surviving joint tenant’s heirs unless the survivor’s will designates otherwise.
• Conflicts may arise between the joint tenants concerning management of the property.
• Large estates held jointly may increase estate taxes compared to most alternatives.

Ways of Owning Real Property

admin — Wed, 27 May 2009 08:49:15 +0000

Real property may be owned by one or more persons. Ownership may be classified by 1) type of estate and 2) if one or more people are co-owners, by type of co-ownership. Estates are a means of measuring ownership in terms of duration or a specific length of time. Leasehold estates involve a right to possession and use of property for a designated limited time period. Freehold estates are of potentially infinite duration or last for an unpredictable length of time. Types of freehold estates include fee simple ownership, life estate, fee simple determinable, and fee simple estates subject to condition subsequent.
•    Fee    Simple     Ownership. Ownership of real estate in fee simple gives an unrestricted right to sell, mortgage, or dispose of the property during life or at death. It is the most complete estate that can be owned in land and includes all of the privileges of land ownership. All other types of freehold estate involve a subdivision of a fee simple estate into two estates: a present interest and a future interest.
•    Life    Estate. A person with a life estate in a farm who has the use of the farm during his or her lifetime is called a life tenant. Although the life tenant can sell the life estate, the buyer would have ownership rights only as long as the original life tenant lived. These rights do not become part of the life tenant’s estate. At the death of a party holding a life estate, the person or persons owning the reversion or remainder interest (all rights not held by the life tenant) would come into possession of the property. If the original owner of the property retains the right to possess the property after the death of the life tenant, this interest is known as a reversion. If the original owner gives the future ownership right to someone else, the future interest is called a remainder and the holder is the remainderman. The owner of a reversion or remainder interest can sell or mortgage his or her interest prior to the death of the life tenant, but the buyer could not obtain present possession of the property until after the death of the life tenant.
In the case of homestead property, rights similar to those under a life estate are given to a surviving spouse.
The surviving spouse may continue to occupy the homestead and receive the income from the property to the exclusion of all adult heirs. The surviving spouse’s interest is similar to a life estate in the homestead, and it would endure so long as the surviving spouse occupied the homestead as his or her home. However, in the case of homestead property, the surviving spouse’s interest is personal and may not be sold or transferred to anyone else.
Conflicts sometimes arise between the life tenant and the remaindermen. The life tenant does have some legal responsibilities that help protect the interests of the remaindermen. The life tenant must avoid waste, which is the unreasonable use of the land that results in injury to the land. The injury must be permanent and affect the future possession and condition of the land. The life tenant must also pay ad valorem taxes and interest on mortgages on the property. The life tenant cannot force remaindermen to contribute to the cost of improving the property unless they consent to do so, even though the remaindermen may benefit from the improvements.
The value of the property in which the owner has reserved a life estate must be included in the estate of the life tenant. However, if the life estate is acquired by gift, inheritance, or will the value of that property would not be included in the life tenant’s estate.
• Fee    Simple    Determinable. This type of estate arises when property is conditionally transferred for a specific use but will revert back to the original owner or will go to the designatee if it ceases to be used for that purpose. For example, property might be given for use as a church but the grant might specify that if the property ceases to be used as a church, the property will once again belong to the original owner. In such a case, the church owners would have a fee simple determinable estate and the original owner would have a possibility of reverter.
• Fee    Simple    Estates    Subject    to    Condition    Subsequent. These estates are very similar to fee simple determinable estates. The chief difference is that in the case of a fee simple determinable estate, the property ownership automatically goes to the future interest holder if the condition is broken, whereas in this type of estate, the future interest holder must take some action to gain title to the property after the condition is broken. If the interest holder fails to take any action, the holder of the Fee Simple Estate Subject to Condition Subsequent will continue to own the property. In this type of estate, the future interest holder has a right of reentry if the original owner retained the future interest or a power of termination if the right was given to someone else. Great care must be taken in creating either a fee simple determinable estate or a fee simple estate subject to condition subsequent to ensure that the wishes of the grantor are fulfilled.

Kinds of Property

admin — Fri, 22 May 2009 08:48:48 +0000

There are two general kinds of property, called “real property” and “personal property.” Real property consists of land and the permanent improvements on it. Personal property includes movable items. Personal property may include tangible objects such as livestock, machinery, and household goods or intangibles such as bank accounts, bonds, stocks, and negotiable notes. The law makes a distinction between real and personal property in matters of inheritance, sale, and mortgage. Also, tax laws and assessments are applied differently to each of these two kinds of property.

Estate Planning Objectives

admin — Sun, 17 May 2009 08:48:29 +0000

Objectives in estate planning will vary from family to family, due to differences in resources, number of children, and value judgments. Clarifying the objectives is one of the first steps in logical, systematic estate planning. Objectives often listed by families may include one or more of the following:
• To provide sufficient income to the parents for the rest of their lives.
• To reduce state and federal estate and gift taxes.
• To reduce lawyers’ fees, probate costs, and other fees.
• To reduce income taxes.
• To minimize disruption during estate settlement.
• To treat all children equitably, not necessarily equally.
• To keep the farm in the family.
• To help one or more of the children to start farming.
• To maintain and continue an efficient operating unit.
• To reward certain children for specific contributions they have made to the parents or to the estate.
• To provide for special needs of some heirs.
• To inform heirs what to expect, so they can make plans accordingly.
The fact that two or more objectives conflict should not deter families from making plans. It is in such cases that planning is most needed. Usually some compromises among the conflicting or competing objectives will have to be made, and it may be impossible to develop fully satisfactory plans. But the results of good planning will be far superior to unplanned property transfers.

Trend Calculations

admin — Mon, 20 Apr 2009 19:30:53 +0000

The purpose of all trend identification methods is to see past the underlying noise in the market, those erratic moves that seem to be meaningless, and find the current direction of prices. Because there may be more than one trend at any one time, caused by short-term events and long-term policy, it is possible to search for th e strongest, or most dominant trend, or a minor trend that corresponds to your expected time frame. The technique that is used to uncover the right trend depends upon whether any of the trend characteristics are known. Does it have a seasonal or cyclic component. is it based on long-term monetary policy, or is it an overnight effect? The more you know about the reasons why prices trend, the better you will be able to find the most reliable calculation for separating the price direction from market noise.
Once you know that there is a fundamental relationship between data, based on measuring the properties of dependence and correlation. a formula can be found that expresses one price movement in terms of the other prices and data. The predictive qualities of these methods are best when applied to data that has been seen before. that is, prices that are within the range of historic data. Forecasting reliability decreases sharply when values are based on extrapolation outside the previous occurrences. This phenomenon will also be true of other trending methods. Because of the way we test and define the final trend calculation, it is based on the movement of historical data: when prices move to new levels, the results of the model will often deteriorate.

LINEAR REGRESSION MODEL

admin — Fri, 17 Apr 2009 19:29:47 +0000

A linear regression, or straight-line fit, could be the basis for a simple trading strategy similar to a moving average. For example, an n-day linear regression, applied to the closing prices, could be used with the following rules:

1. Buy when the closing price moves above the forecasted value of today’s close.

2. Sell when the closing price moves below the forecasted value of today’s close.`

There is an important difference between a model based on linear regression and one founded on a moving average. There is no lag in a regression strategy. If prices continue higher at the same rate, a moving average system will initially lag behind, then increase at the same rate. The lag creates a safety zone to absorb some changes in the direction of prices, without getting stopped out. A regression model, on the other hand, identifies a change of direction sooner by measuring future movement against a straight-line projection in which the current price value has little influence. A steady price move, however, will place the fitted line right in the center of market movement, subject to frequent whipsaws. The area at which a uniform trend changes from one direction to another is a difficult case for a linear regression system and points out the need for using bands. Even with bands, the turning point of an orderly trend will appear to have much greater variance than during the direction period over the same calculation interval.

Regression Analysis

admin — Mon, 13 Apr 2009 19:22:44 +0000

Regression analysis is a way of measuring the relationship between two or more sets of data. An economist might want to know how the supply of wheat affects wheat prices, or the relationship among gold, inflation, and the value of the U.S. dollar. A hedger or arbitrageur could use the relationship between two related products. such as palm oil and soybean oil, to select the cheaper product or to profit from the difference. or you can find the pattern that binds the Producer Price Index to interest rates. Regression analysis involves statistical measurements that determine the type of relationship that exists between the data studied. Many of the concepts are important in technical analysis and should be understood by all technicians, even if they are not used frequently.
Regression analysis is often applied separately to the basic components of a time series, that is, the trend, seasonal (or secular trend), and cyclic elements- These three factors are present in all price data. The part of the data that cannot be explained by these three elements is considered random, or unaccountable.
Trends are the basis of many trading systems. Long-term trends can be related to economic factors, such as inflation or shifts in the value of the U.S. dollar due to the balance of trade or changing interest rates. The reasons for the existence of short-term trends are not always clear. A sharp decline in oil supply would quickly send prices soaring, and a Soviet wheat embargo would force grain prices into a decline; however, trends that exist over periods of a few days cannot always be related to economic factors but may be strictly behavioral.
Major fluctuations about the long-term trend are attributed to cycles. Both business and industrial cycles respond slowly to changes in supply and demand. The decision to close a factory or shift to a new crop cannot be made immediately, nor can the decision be easily changed once it is made. Stimulating economic growth by lowering interest rates is not a cure that works overnight. Opening a new mine, finding crude oil deposits. or building an additional soybean processing plant makes the response to increased demand slower than the act of cutting back on production. Moreover, once the investment has been made. business is not inclined to stop production, even at returns below production costs.
The random element of price movement is a composite of everything unexplainable. In later sections ARIMA, or Box-Jenkins methods, will be used to find shorter trends and cycles that may exist in these leftover data.

Foreign exchanges part 5

admin — Fri, 10 Apr 2009 10:14:39 +0000

None other than James Tobin (who died in 2002) recommended in 2001 that banks be taxed not on each distinct operation, but rather over a week to allow for these market adjustments. That would have left 80 percent of the transactions outside the Tobin Tax. For a number of years, advocates of the latter led many people to believe that it was normal for speculators to have their speculative gains subjected to taxation. Nobody ever stated that this was a tax not on gains but on movement. Nobody ever openly recognized that speculative gains were in fact taxed in most countries in any case.
Such issues give rise to strong feelings. An article in French daily Le Monde on October 23, 2001 commented:
According to the organizers, from the 19th through the 21st of October there were 4,000 people assembled in the classrooms and amphitheaters of Berlin Tech. The police were not present and provided no figures. It is nonetheless clear that participants at the founding congress of the German branch of the Attac protest movement were quite numerous. Of French origin, the ‘‘Association for the taxation of financial transactions and for aid to citizens’’ is growing rapidly in Europe, publicizing the acronym and concerns that made it famous … Less abrupt in their formulations but just as categorical, others denounced the war, asserting that the tragic events in New York and Washington corroborated their theories according to which it was the world market that fed the flames of terrorism. Each speaker denied being anti-American and proclaimed his horror of terrorism, but the long and unremitting reminders of the interventions of the US Army in many areas these past 50 years limited the scope of the affirmation and at the same time clearly assessed responsibilities: the United States and the wholesale globalization imposed by America bear exclusive responsibility for what happened there.
The ATTAC (Action for a Tobin Tax for the Assistance of Citizens) was created in France in 1998 by Le Monde Diplomatique, a subsidiary of the French newspaper. It would seem that the chickens had come home to roost. Once again, people were hoodwinked by a dollop of intellectual terrorism. Once again, people succumbed to the temptation to subscribe to simplistic recipes at a time when problem resolution is highly complex, necessitates a great deal of time and presupposes basic minimal humility.

Foreign exchanges part 4

admin — Thu, 09 Apr 2009 12:13:14 +0000

Some economists, many of them European, are against the foreign exchange market. They see it as an ongoing illustration of the untold evils of capitalism. Price fluctuation, globalization of trade and more precisely the pronounced imbalance between the volume of transactions on the foreign exchange market and the much lower volume on the international goods market are thought to show that the exchange market is an evil nuisance that needs to be mastered. At the turn of the millennium, these economists impelled some governments, especially those in Europe, to implement the Tobin tax as a means of regulating foreign exchange markets. Conceived at the outset of the 1970s, the taxation proposed by James Tobin (who won the 1981 Nobel Prize in economics) was meant to equip the mechanisms of currency exchange markets with a grain or two of sand. It was a matter of levying small-scale customs duties any time that capital was converted from one currency into another. Capital would be submitted to customs charges, just as drivers pay a toll when using a motorway or turnpike. It was assumed that even minimal tax rates would paralyze speculation in so far as the latter feeds on infinitesimal fluctuations. The benefits derived from this operation would contribute favorably to the World Bank.
Our economists viewed this as a question of stemming the flow of the speculative capital that was supposedly causing financial and monetary crises. If speculators’ dealings were brought to an end, it was thought that currency fluctuations would diminish and monetary crises be avoided. In fact, even a small degree of taxation does have a significant impact on a speculative market; speculators do often bet on perhaps minimal price fluctuations. And yet those economists have forgotten that a transaction on the foreign exchange market involving two currencies is often the result of transactions between many other currencies. To use the same example as before, when a Turkish firm purchases Polish goods, it must sell the Turkish pounds in its possession for zlotys. But there is quite probably nobody who, at precisely the same time, needs to sell exactly the same quantity of zlotys for Turkish pounds. In order to perform this transaction, banks are compelled to purchase Turkish pounds from the firm and go on to sell them for a given quantity of euros; these will be sold for dollars; the dollars may perhaps be sold for yen; then the yen could be sold for roubles, which would be sold for the aforementioned zlotys. By levying even a token tax on each transaction, our economists render exchanges between the zloty and the Turkish pound unaffordable.
They have perhaps conveniently forgotten that the proposition formulated by James Tobin stems from a time (before 1971) when foreign exchange was fixed under the Bretton Woods agreement. His idea consisted in preserving some national monetary autonomy. Arbitrage tends to keep interest rates on the monetary market at the same level in all the currencies of the world once risk factors are taken into account. This prevents central banks from carrying out independent monetary policies. If a slight taxation of speculative movements has a negligible effect on an isolated transaction, it amputates an annual yield by 2.5 percent if there is only one movement per week. This taxation would leave a ‘‘margin’’ for central bankers to intervene on their interest rates. In a fixed-rate system within the framework of the Bretton Woods agreements, each member of the IMF pegged the value of its currency to that of gold, which meant in practice that it was pegged to the dollar at a time when the latter still respected the gold standard. In this system arbitrage transactions were numerous, but the present-day floating exchange rate system renders them exponentially greater. Parities result from transactions between two currencies, amid hundreds of others; in a ‘‘floating’’ rate system, adjustments are multiple and manifold. That is why intercurrency transactions are of much higher volume than that of the underlying, related transactions in goods. That is also why, according to the figures issued by the IMF, 80 percent of FX transactions are reversed in a week or less.