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France Is Headed Toward An Undivided Leftist Government

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Francois Hollande

President François Hollande and the French left took Round 1 yesterday of parliamentary elections that are being closely watched as harbingers of Europe’s political direction at a time of economic crisis.

Most of the individual seats still need to be won in a June 17 runoff. But leftist parties enter those contests with the overall best showing, taking 46 percent of French voters, and setting up Mr. Hollande and his Socialists – who won 36 percent – for a majority needed for a free hand and an undivided government. 

“It’s a very, very good result for the Socialists and François Hollande,” says Arun Kapil of Catholic University in Paris. “But we will see on June 17. I think the Socialists are on track to get a majority on their own.”

Six of Hollande’s 24 declared cabinet ministers, including Prime Minister Jean-Marc Ayrault and Foreign Minister Laurent Fabius, were elected outright yesterday. But as of this morning’s tally, only about 60 seats of the 577-seat body were decided after the lowest voter turnout (57 percent) since Charles de Gaulle took office in the 1960s.

Under the election rules, a candidate must receive an outright majority of votes to win in Round 1. Otherwise, all candidates who garner more than 12.5 percent of the vote advance to a runoff.

Winning a clear majority on June 17 would enable Hollande to consolidate power and give heft to programs expected to combine growth with the tough and increasingly controversial austerity-only policies that have dominated Europe’s remedy for its economic crisis and that are favored by German Chancellor Angela Merkel.

While characterized by some foreign media as a “tax and spend” liberal, Hollande is in fact a pragmatist who pledges a balanced budget by 2017 and a 3 percent budget deficit next year. The French right is skeptical he can do so.

Like most European politicians in an age of austerity, Hollande's hand is severely constrained. So far, he has implemented symbolic measures such as cutting his and his ministers' salaries by 30 percent. He has tinkered with social fairness policies: He did not change the pension reforms of Mr. Sarkozy that moved France's generous retirement age from 60 to 62; but he added a caveat allowing those beginning work at age 18 to retire at 60, and to allow females to count part of their pregnancy months. 

But while French voters gave Hollande a boost, he has not yet delivered a knockout blow to the political right.  The main right party of former president Nicolas Sarkozy took 27 percent to bring the conservative majority to a 34 percent total.

“There was no ‘pink landslide,’” said former Prime Minister François Fillon, referring to the vote on the left.

“Without a majority, no laws will be passed,” warned Prime Minister Ayrault after last night’s tally.

The elections appear set to give the French far right party of Marine Le Pen, which is anti-Europe and anti-Islam, its first seats in decades. Ms. Le Pen’s National Front, which is now the No. 3 party in France, got 13.6 percent.  But in a clear blow to Le Pen, the main French right party headed until May by Nicolas Sarkozy has not been willing to align itself with her, dashing her hopes for a historic realignment.

However, Le Pen trounced far-left figure Jean-Luc Mélenchon in Henin-Beaumont, a distressed former mining region, in what Mr. Melenchon had hoped would be a comeuppance for her. Melenchon had made waves this spring as a dynamic new voice on the far nationalist left. But after carpetbagging up in the French north, his nose was bloodied by Le Pen, who scored 42 percent to his 21 percent.

Le Pen’s party may score three seats. In Paris today, speculation has it that one of those seats would be from the Le Pen clan: Marion Marechal-Le Pen, Ms. Le Pen’s niece and granddaughter of Jean-Marie Le Pen, the party founder.

In an unexpected development, Ségolène Royal, the Socialist Party nominee in 2007 and the former partner of Hollande, could well lose her seat after deciding to run in a region that has other popular long-time Socialists. Le Parisian today commented on a campaign of “Saving Private Royal,” after party officials have tried to ban other candidates from that seat.

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BUSTED: Half Of These Companies' Twitter Followers Are Bots

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twitter ipad web app main image

Up to 46 percent of Twitter followers of companies with active profiles could be generated by robots, or bots, a study by Marco Camisani Calzolari, a corporate communication and digital languages professor in Milan, showed on Friday.

The academic analyzed feeds of 39 international and Italian brands, including @DellOutlet, @BlackBerry, @CocaCola, @IKEAITALIA and @VodafoneIT, trying to distinguish fake followers from real ones based on their behavior.

"The number of followers is no longer a valid indicator of the popularity of a Twitter user, and can no longer by analyzed separately from qualitative information," Calzolari said.

Calzolari said companies could not be blamed necessarily for the presence of fake followers because they often delegate their PR activities on social networks to third parties.

"In some cases, the web agency or media centre executives have chosen to take short cuts in order to demonstrate to companies, who are oblivious, that their activities have been successful by generating lots of new users," he said.

A sample of 10,000 followers was analyzed for each company. A software used a random algorithm to extract a sample selection of followers and two classed of parameters established whether the user's behaviors is most likely to be human or carried out by a bot.

A user who logged into Twitter through different clients, a profile containing a name, an image or a physical address, or which uses punctuation in posts was associated among other things with characteristics that are probably human.

Vodafone Italia said it never evaluated its social media activities by simply counting the number of its fans but instead it had chosen metrics that give value to interaction.

About 39 percent of @VodafoneIT followers are probably bots, according to the study.

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REPORT: The EU Is Considering Limiting ATM Withdrawals And Imposing Border Checks If Greece Leaves The Euro

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greece riot police

European finance officials have discussed as a worst-case scenario limiting the size of withdrawals from ATM machines, imposing border checks and introducing capital controls in at least Greece should Athens decide to leave the euro.

EU officials have told Reuters the ideas are part of a range of contingency plans. They emphasized that the discussions were merely about being prepared for any eventuality rather than planning for something they expect to happen - no one Reuters has spoken to expects Greece to leave the single currency area.

Belgium's finance minister, Steve Vanackere, said at the end of May that it was a basic function of each euro zone member state to be prepared for problems. These discussions appear to be in that vein.

But with increased political uncertainty in Greece following the inconclusive election on May 6 and ahead of a second election on June 17, there is now an increased need to have contingencies in place, the EU sources said.

The discussions have taken place in conference calls over the past six weeks, as concerns have grown that a radical-left coalition, SYRIZA, may win the second election, increasing the risk that Greece could renege on its EU/IMF bailout and therefore move closer to abandoning the currency.

No decisions have been taken on the calls, but members of the Eurogroup Working Group, which consists of euro zone deputy finance ministers and heads of treasury departments, have discussed the options in some detail, the sources said.

As well as limiting cash withdrawals and imposing capital controls, they have discussed the possibility of suspending the Schengen agreement, which allows for visa-free travel among 26 countries, including most of the European Union.

"Contingency planning is underway for a scenario under which Greece leaves," one of the sources, who has been involved in the conference calls, said. "Limited cash withdrawals from ATMs and limited movement of capital have been considered and analyzed."

Another source confirmed the discussions, including that the suspension of Schengen was among the options raised.

"These are not political discussions, these are discussions among finance experts who need to be prepared for any eventuality," the second source said. "It is sensible planning, that is all, planning for the worst-case scenario."

The first official said it was still being examined whether there was a legal basis for such extreme measures.

"The Bank of Greece is not aware of any such plans," a central bank spokesman in Athens told Reuters when asked about the sources' comments.

The vast majority of Greeks - some surveys have indicated 75 to 80 percent - like the euro and want to retain the currency, something Greek politicians are aware of and which may dissuade them from pushing the country too close to the brink.

However, SYRIZA is expected to win or come a strong second on June 17. Alexis Tsipras, the party's 37-year-old leader, has said he plans to tear up or heavily renegotiate the 130-billion-euro bailout agreed with the EU and IMF. The EU and IMF have said they are not prepared to renegotiate.

If those differences cannot be resolved, the threat of the country leaving or being forced out of the euro will remain, and hence the need for contingencies to be in place.

Switzerland said last month it was considering introducing capital controls if the euro falls apart.

In a conference call on May 21, the Eurogroup Working Group told euro zone member states that they should each have a plan in place if Greece were to leave the currency.

Belgium's Vanackere said two days after that call that it was a basic function of each euro zone member state to be prepared for any eventuality.

"All the contingency plans (for Greece) come back to the same thing: to be responsible as a government is to foresee even what you hope to avoid," he told reporters.

"We must insist on efforts to avoid an exit scenario but that doesn't mean we are not preparing for eventualities.

(Additional reporting Martin Santa and George Georgiopoulos. Writing by Luke Baker. Editing by Jeremy Gaunt.)

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4 Risks Every Investor Must Come To Grips With

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whale shark scuba

No investment is without risk. You may feel safe even when you do what financial advisers consider the “right thing” — invest in a broad stock market index fund with a long-term view — but there is risk there as well. Unfortunately, to build wealth over time, investors need to accept a significant amount of risk. Leaving money in risk-free investments such as high-yield savings accounts isn’t investing at all. By taking on very little risk, keeping the bulk of your wealth in a savings account practically guarantees you’ll lose purchasing power over the long term due to the rising costs of goods that you might buy with that money.

If you’re interested in growing your wealth over long periods of time — and most middle class investors will need to grow wealth rather than just preserve it if financial independence is an appealing goal — you’ll need to consider riskier investments than savings accounts. There is a dizzying selection of investment types ranging across the entire risk spectrum, from money market funds — low-risk investments similar to savings accounts — to complex financial derivatives — risky financial moves often best left to professional investors.

Anyone who has ever invested in a 401(k) plan has had the opportunity to be familiar with risk profiling. To help you design your retirement portfolio, most 401(k) managers allow you to select your investments based on your appetite for risk. By asking the investor several questions about how they would react to different levels of investment performance, these 401(k) tools will categorize the investor based on risk tolerance: usually low, medium, and high.

Measuring and evaluating the risk involved in any investment is a little more complex. While an investor’s risk tolerance can be categorized or marked on a scale, an investment’s risk should be plotted using several dimensions. To evaluate an investment, you should consider the different types of risk that could affect its performance in order to determine whether the investment is appropriate for you.

Market risk

Market risk considers a broader picture. If you are invested in stocks, particularly if you choose the less expensive (but not necessarily safer) route of investing in a broad stock-based index fund, you have to accept that the overall economic condition of the country — or even the world — will cause your investment’s value to fluctuate. Market risk is relevant also for investments in single companies, bonds, or other products.

A market crash or decline could crush this investment’s performance, even if the quality of your investment remains the same. Investments also follow trends. For several decades, real estate could appear to be a “good” investment, encouraging more people to buy real estate, driving up prices for everyone else. Once the overall sentiment of investors switches to the belief that real estate is overpriced, your property could lose potential value even though the structure hasn’t changed.

Default risk

Default risk is related to the quality of the underlying investment, and it is more apparent when investing in a single company, through stocks or bonds. If you invest in a company’s bond or a municipality’s, you generally expect a guaranteed return. The promised return is usually higher than what a savings account would provide, but you face the risk of default. If the company files for bankruptcy of if the municipality is mismanaged, it’s possible you won’t receive the return you were promised.

Pensions, thought to be stable investments for retirements, are also exposed to default risk. Today, your company may be promising all retirees access to free health care, but if your company later restructures, that promised benefit might disappear. The government offers a type of insurance for companies that offer pensions, but sometimes that insurance isn’t enough to ensure all pensioners receive exactly what had been promised.

Inflation risk

Financial planners like to assume that inflation runs about 3 or 4 percent a year over long periods of time. This allows planners and investors to calculate expected “real” returns for an investment. If you assume inflation is 3 percent and your savings account earns 1 percent APY, your real return is a loss of 2 percent a year. This real return takes the effect of inflation into account.

There is a chance, however, that during any particular time, the measure of inflation — or for a more accurate description in this case, the increase of the cost of goods — is significantly more than 3 percent. If the country were to enter a period of hyperinflation, investments in your savings account until banks offer more appropriate interest rates would result in devastating losses when compared to consumer prices. When a gallon of milk costs $25, a gallon of gasoline costs $30, and a movie ticket costs $75, it will be much harder to get by on the same income you had with today’s prices.

Mortality risk

Consider mortality risk when you have or are considering investments in pensions, insurance contracts, annuities, or any investment with a long-term horizon. Annuities are the best examples. If your annuity payments or distributions to you continue only as long as you’re alive, you run the risk of dying before you receive enough of your benefit to make the premium payments and fees worthwhile. If your investment strategy focuses solely on the long-term, there is a chance that you will never live to enjoy the benefits.

Life is short. It’s almost always shorter than you would want it to be. But mortality risk runs in the opposite direction as well. If you live longer than expected, and you have tried to plan your financial life so you fully expend your wealth during retirement, you run the risk of running out of money.

Spend some time to think about the risks of your investments. You may discover that your tolerance for risk is lower than you expected or that you’ll need to adjust to accepting more risk in order to meet your financial goals.

DON'T MISS: How To Stop Investing Like A Muppet And Start Investing Like A Billionaire >

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Should Renters Get The Same Rights As Homeowners?

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blight, Detroit, homeowner, foreclosure

If Americans took away one lesson from the housing crash, it’s that a house is not always a Treasury bond. In the latest Fannie Mae survey on attitudes toward housing, only 56 percent of respondents say they consider a home a safe investment—that’s down from 83 percent in 2003.

RELATED: 12 Markets Where It’s Better to Rent

As thousands of foreclosed homeowners have transitioned to apartment living, renting has acquired a certain cool. The number of renters has jumped 16 percent since 2004 to almost 106 million, according to Census figures. Apartment communities catering to millennials that resemble destination living are popping up in cities like Dallas, offering swimming pools, chain restaurants, volleyball courts, and other amenities. The number of permits for construction of multifamily housing units (the majority of which are rental apartments) soared 61 percent between the first-quarter of 2011 and first-quarter of 2012.

Though renters’ numbers have surged, their political clout hasn’t. Homeowners receive numerous tax benefits unavailable to renters, including the mortgage interest deduction, home sale deductions, property tax deductions, and tax-free capital gains.

Of the federal housing subsidies in 2009, 79 percent went to homeowners and 21 percent to renters, according to the National Multi-Housing Council. In Washington, the major players on national housing policy are groups like the National Association of Realtors, the National Association of Homebuilders, and the Mortgage Bankers Association, which go to bat for homeowners, not renters.

Sixty-year-old Bill Deegan says he’s out to change that. A two-time town councilman and former host of the radio show “Renter Nation” on Phoenix station KFNX, Deegan launched a free-membership organization last month, also called Renter Nation, that aims to advocate for renters.

The group’s motto is “by, for, and about America’s residential renters,” and so far, Deegan and his team have been busy mobilizing renters through social media, and reaching out to media in an effort to break down stereotypes of anyone who sends checks to a landlord.

For example, on June 1 they issued a news release criticizing the upcoming Spike TV series World’s Worst Tenants and urged advertisers to reconsider their support. The Fiscal Times recently talked with Deegan on the changing landscape of renting.

The Fiscal Times (TFT): How did Renter Nation start?
Bill Deegan (BD): I was in my car one day in early 2009 listening to a story about proposed bailouts for existing homeowners and tax credits for new owners. And I’d been reading about people who stay in their homes literally for years without making a mortgage payment before foreclosure. Being a renter, I know that if you don’t pay, you’re often out in a month. I thought this isn’t right, this isn’t fair, so I decided that I was going to call whoever advocates for renters nationally and give them my two cents. Lo and behold, I discovered that there was no such group. So I decided to start one myself.

TFT: What do you want to accomplish?
BD: We want to empower renters. Our website gives practical information like how you get your security deposit back and what to do about noisy neighbors. You can shop for an apartment and download coupons. We have a blog where people can keep up on issues that affect renters. And there’s Rentertainment, where we and our users post videos, photos, and other entertaining stuff related to renting. It’s a for-profit site, but we also plan to use a portion of the revenues to organize for changes in housing policy.

RELATED: The 5 Worst Rental Scams to Watch Out For

TFT: You have a kind of manifesto on your site called “I’m proud to rent.” What are you getting at there?
BD: I think it’s ingrained in our culture that renters are second-class citizens. And that’s reflected in our national policies, especially the mortgage interest tax deduction. The National Multi-Housing Council notes that of the federal housing subsidies in 2009, 79 percent went to homeowners and 21 percent to renters. So I think we’re being shortchanged—we’re about 38 percent now of the population but getting only 21 percent of the resources. I think renters have been silent too long, and it’s time we spoke up.

TFT: What’s wrong with promoting homeownership?
BD: We’ve got nothing against homeownership. It’s fine for some people. Just don't ask me as a renter to subsidize it. I think a home should just be viewed as a place to live, and if it happens to appreciate in value, good for you.

I’m a total advocate for renters and multifamily housing. With more multifamily housing and denser development, there’s less of a footprint on the environment. You don’t have tract houses encroaching on farms and fields and wildlife habitat. It means fewer roads and less need for capital expenditure for sewer lines and other infrastructure—and less reliance on imported oil.

TFT: But those who support homeownership cite studies indicating that neighborhoods with more homeowners have less crime and better citizen involvement, for example.
BD: I’d point you to research last year by Grace Bucchianeri of the Wharton School of Business called The American Dream or The American Delusion—she notes that if you look at studies that have controlled for income, housing quality, and other factors, homeowners are no happier than renters, and she doesn’t see evidence that homeowners are better citizens. Just look at New York City, where something like 70 percent of the population are renters. You want to tell me New York doesn’t have citizen participation? They sure do. And as for crime, I don’t think that’s true, especially now. Here in Arizona, you have subdivisions where half the homes on the block are in foreclosure and there’s all sorts of stuff going on in those houses. That’s not a place I want to live.

TFT: The National Association of Realtors just had 10,000 of their members come to
Washington to promote homeownership. Other than fiscal watchdog groups, there doesn’t seem to be a lot of vocal support for your side of the housing debate. What’s your political strategy?
BD: Having been a politician, I know that leaders respond to a constituency that votes. That’s why we’ve affiliated with MTV’s Rock the Vote, so [renters] can register. We want to make renters aware that if they want something in their community that is beneficial to renters, they have to vote.
We also want to mobilize by working with what we estimate are 30,000-plus local, state, and regional tenants associations. We’d love to join with them to organize a million-renter march, for example. We would like to be sitting at the housing policy discussion tables in Washington and our state capitals.

TFT: What else needs changing?
BD: There are thirteen cities here in Arizona alone that have renter’s taxes, which to me is a discriminatory tax. There are communities in this country like Madison, Mississippi and West St. Paul, Minnesota that put caps on the number of renters who can live there. I view this almost as a civil rights issue. You substitute black or Hispanic for renter and it’s just purely discriminatory. These are the kind of things that we're going to be working on.

We want to change the culture—not only how society views renting, but how renters feel about themselves. There’s nothing wrong with renting—it’s a good thing. It gives you flexibility, which is especially important when unemployment is high like right now. I know homeowners who got job offers in other cities but can’t move because they’re stuck in underwater mortgages.

TFT: One of the problems with being a renter is the lack of control—you can’t paint without permission, you can’t change the kitchen, and you could lose your home whenever the landlord sells. Could there be a new model of renting? 
BD: It’s a good point. Landlords could make accommodations, say, longer-term leases—so that instead of signing a one-year lease, maybe you go with a five-year lease and then you as the renter have some latitude in terms of design. But local laws would have to be changed to allow that model.

SEE ALSO: The hottest NYC neighborhoods to invest in right now > 

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Stories About India's Slowdown Are Way Overblown

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indian flagTo hear some people tell it, the bloom is off the Indian economic rose.

Hailed until recently as the next big success story, the country has lately been assailed by bad news.

Tales abound of investor flight (mainly owing to a retrospective tax law enacted this year to collect taxes from Indian companies’ foreign transactions); mounting inflation, as food and fuel prices rise; and political infighting, which has delayed a new policy to permit foreign direct investment in India’s retail-trade sector. Some have even declared that the “India story” is over.

But today’s pessimism is as exaggerated as yesterday’s optimism was overblown. Even as the world has faced an unprecedented global economic crisis and recession, with most countries suffering negative growth rates in at least one quarter in the last four years, India remains the world’s second-fastest-growing major economy, after China.

Many reasons have been cited for this success. India’s banks and financial institutions were not tempted to buy mortgage-backed securities and engage in the fancy derivatives trading that ruined several Western financial institutions. And, though India’s merchandise exports registered declines of about 30%, services exports continued to do well. Moreover, remittances from overseas Indians remain robust, rising from $46.4 billion in 2008-2009 to $57.8 billion in 2010-2011, with the bulk coming from the blue-collar Indian expatriate community in the Gulf.

Finally, the external sector accounts for only about 20% of India’s GDP. Most of the economy is a domestic affair: Indians producing goods and services for other Indians to consume in India.

The Indian private sector is efficient and entrepreneurial, and is compensating for the state’s inadequacies. (An old joke suggests that the Indian economy grows at night, when the government is asleep.) India is good at channeling domestic savings into productive investments, which is why it has relied so much less on foreign direct investment, and is even exporting capital to OECD countries, where it is well able to control and manage assets in sophisticated financial markets. Indeed, India, home of Asia’s oldest stock market and a thriving democracy, has the basic systems that it needs to operate a twenty-first-century economy in an open and globalizing world.

There are other reasons for confidence that India will weather the storm. Not only does India have considerable resources of its own to put towards investment; as the persistence of global recession drives down returns in the West, foreign investors will look anew at India.

Still, many are inclined to compare India unfavorably with China, so a few macroeconomic numbers are worth considering. Half of India’s growth has come from private consumption, and less than 10% from external demand; by contrast, 65% of China’s real GDP growth comes from exports, and only 25% from private consumption. China is thus far more vulnerable to external shocks.

Moreover, India has the highest household savings rate in Asia, at 32% of disposable income. In fact, households account for 65% of India’s national annual savings, compared to under 40% in China. Bad loans account for only 2% of Indian banks’ credit portfolios, versus 20% in China. And India’s workforce has been growing at nearly 2% annually in the last decade, while China’s grew at less than 1%.

Putting China aside, India’s economy grew by 6.5% in 2011-2012, with services up by 9% and accounting for 58% of India’s GDP growth – a stabilizing factor when a world in recession cannot afford to buy more manufactured goods.

McKinsey & Company estimates that the Indian middle class will grow to 525 million by 2025, 1.5 times the projected size of the US middle class. According to last year’s census, the country’s 247 million households, two-thirds of them rural, reported a rise in the literacy rate to 74%, from 65% in 2001. In just the last two years, 51,000 schools were opened and 680,000 teachers appointed.

An impressive 63% of Indians now have phones, up from just 9% a decade ago; 100 million new phone connections were established last year, including 40 million in rural areas; and India now has 943.5 million telephone connections. Nearly 60% of Indians have a bank account (indeed, more than 50 million new bank accounts have been opened in the last three years, mainly in rural India).

Some 20,000 MW in additional power-generation capacity was added last year, with 3.5 million new electricity connections in rural India. As a result, 8,000 villages got power for the first time last year, and 93% of Indians in towns and cities now have at least some access to electricity.

These trends all augur well for India’s economic future. And they aren’t slowing: India is looking for $1 trillion in infrastructure development over the next five years, most of it in the form of public-private partnerships. This offers hugely exciting opportunities to investors.

The real picture of dogged progress is far removed from the perception of a government beset by inaction and policy paralysis. As Prime Minister Manmohan Singh modestly put it: “I will be the first to say we need to do better. But let no one doubt that we have achieved much.”

Read more from our "Will India's Boom Go Bust?" Focal Point.

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You've Got To See This Guy's Extreme 150 Credit Card Collection

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In response to my earlier post about one of our credit cards being closed due to inactivity, long-time reader and regular commenter BG mentioned that he and his wife have upwards of 150 credit cards. They’ve apparently been collecting these cards in an attempt to illustrate the poor management of mega-banks like Citi.

He went on to say that none of this seems to have adversely impacted them, as theircredit scores are well over 760 and they’ve just recently closed on a mortgage refinance. In other words, their credit is just fine, thank you.

Intrigued, I followed up with him and he offered to send me a photo for publication on FCN. And so, without further ado, I present to you BG’s credit card collection…

stack of credit cards

Pretty impressive, huh?

Apparently half of these are his and half are his wife’s, so tey don’t all trace back to a unique account. But still. Wow. That’s a lot of credit cards.

The stack of black cards near the bottom are all the same type of Citi card. Apparently their approval system is such that they’re willing to approve him for a new card every month.

As for his total credit limit, he hasn’t added it up (yet — if he does, I’ll update to let you know) but he thinks it’s “probably enough to buy a pretty nice house, if that were possible to do with credit cards.”

He says that he typically uses each card enough to get the associated signup bonus (like this onethis one, or this one) and then sticks it in a box never to be used again — other than for photo opps like this, I guess! 

Honestly, I’d be more interested in hearing about the sum total of his bonuses than his credit limits, but both would be interesting tidbits.

So, dear readers, can any of your credit card collections compete with BG’s? Let us know in the comments.

More generally, if you have any amusing, entertaining, or informative finance-related pictures, please don’t hesitate to get in touch. Hit me up with a brief description using the contact form and I’ll get back to you ASAP.

DON'T MISS: These are the 25 most badass credit cards out there right now >

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Director Peter Berg Admits He Wasn't Passionate About Making 'Battleship'

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weapons of battleship

"Battleship," the high-concept but underperforming action film released by Universal earlier this year, made a surprise appearance in discussions about risky movies and passion projects at the Produced By Conference on Sunday morning.

Peter Berg, the director of that film, was taking part in a discussion entitled "Passion Projects: Making Films Everyone Says Will Never Get Made" when he addressed the elephant in the room: that his last film, based on the board game, was the kind of movie generally seen as the antithesis of a passion project.

"I have a movie in theaters right now which has obviously underperformed in many ways," he said. "When [a movie] doesn't work, it's an … interesting opportunity to look at what went wrong and how it went wrong."

Also read: Christopher Nolan Says Digital Is All About Money, Not Quality

With "Battleship," he said, the scale of the movie simply overwhelmed everything else. "It was a movie that I tried as hard as I could to get inside of. But the concept is so big and powerful, and the money is so big and so powerful, that the movie is going to run away with itself."

In the end, he said, he failed to find a personal connection that would make him passionate about the movie. "I want to get inside the movie's world and feel like I know it better than anyone, and I couldn't do that … It was an interesting eye-opener." 

His comments about "Battleship" came on a morning when a couple of the biggest panels at the Producers Guild's Produced By Conference dealt with the problems of getting risky movies made in an increasingly conservative studio system.

Also read: Lionsgate Vice Chairman Michael Burns: 'We Don't Want to Be The New Major'

Grazer shared his story about launching "Splash" in the face of a competing mermaid movie that would have starred Warren Beatty and Jessica Lange, and about reviving "American Gangster," which Universal killed after already spending $28 million.

"It was a movie that I tried as hard as I could to get inside of. But the concept is so big and powerful, and the money is so big and so powerful, that the movie is going to run away with itself," — Peter Berg, "Battleship" Director

The studio told him to never mention the words "American Gangster" again, he said – but he ignored them and immediately repackaged the Denzel Washington film with a new director, Ridley Scott, and co-star, Russell Crowe, in place of original players Antoine Fuqua and Benicio del Toro.

Also read: Shonda Rhimes, Bill Lawrence, Nigel Lythgoe: Our Worst Pitches Led to Hit Shows

Grazer and Berg also talked about their experiences together making "Friday Night Lights," and about the night Berg tried to get the studio excited about making the film by flying a batch of executives to Odessa, Texas for a Friday night high-school football game.

None of them wanted to go, he said – but they reluctantly agreed while stipulating that they'd leave at halftime. Instead, they stayed until the end and fell in love with the world of high-school football. Then, on the way home, the engines failed and the power went out on their airplane.

"I was like, 'Fuck!'" said Berg.

"I knew I had the green light, and instead we were going to crash." But the power came back on, they made it home "and by the time we got off that plane, we had had the communal experience that ignited the particular passion necessary to get that movie made."

Earlier on the same soundstage on the Sony lot, another group of producers spent an hour talking about their own passion projects, and about the future of film production in an era where, as moderator Michael Shamberg pointed out, the annual chart of top-grossers is dominated by sequels and nearly 70 percent of box-office revenue comes from international.

"The audience is causing the change," said Ceán Chaffin, director David Fincher's producing partner. "The audience that we want [for serious dramas] is harder and harder to find."

"We have to be more inventive and resourceful than we ever had to in the past," added Mark Johnson, who began his career with "Diner" 30 years ago.

battleship The session was titled "Game Changers: Where Movies Should Be Going," but most of the producers admitted that they don't really know where movies should be going – they just know that it's difficult to make quality films and difficult to find an audience.

"The most elusive thing is always good," said Doug Wick, producer of "Gladiator" and the upcoming Baz Luhrmann version of "The Great Gatsby." "Making something that turns out good is the hardest part."

The panel, which also included "Moneyball" producer Michael DeLuca, talked about dream projects that took years to get off the ground. For DeLuca, it was "Moneyball": "It took eight years," he said of the film, which would have died if Sony's Amy Pascal hadn't been a big supporter. "I've sworn off dream projects since then."

Johnson, though, admitted he has a dream project he's currently hoping to get off the ground: a script from "Breaking Bad" creator Vince Gilligan called "Two Face."

"I still think it's the best script I've ever come across," said Johnson, one of the producers on "Breaking Bad." "It's a comedy about racism, and it’s a very hard sell, but I'm convinced it's going to get made."

In a discussion of future projects, Chaffin said that she and Fincher (who was watching from the back of the soundstage) are considering a movie that would partially be shot in 3D.

"We think 3D should be applied very specifically," she said. "We're actually thinking of mixing 3D and 2D in one film."

Again and again, the conversation circled back to dealing with studios in an uncertain era in which even the old standbys are no longer safe bets. "If you just get a mediocre director and a superhero, it's not a particularly good equation for a studio anymore," said Wick.

"I want to get inside the movie's world and feel like I know it better than anyone, and I couldn't do that … It was an interesting eye-opener." — Peter Berg, Director

And when a film doesn't work, the producers agreed that the results can be devastating. Johnson talked about going into a months-long depression after the commercial failure of Alfonso Cuaron's "A Little Princess," which he said was "the closest thing to a perfect movie I've ever made."

And Chaffin said she and Fincher were badly shaken by the commercial failure of "Fight Club," which Fox executives hated and which couldn't find its market until it was released on home video.

"'Fight Club' was devastating," Chaffin said. "All of us who worked on the film thought we had something great."

Throughout the session, Sony's Pascal received so much praise from the panelists that eventually Shamberg stepped in.

"Everybody here loves Amy," he said, "but we also like the others."

"All except one," said Chaffin, who declined to specify the one. 

SEE ALSO: Five things we learned from "Prometheus" >

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6 Tips To Avoid Crying During An Interview

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My friend recently cried in an interview, and she sorely regretted it. She was thrown off by a question, because it reminded her of a sick relative. Once she started talking about it, she couldn't control the waterworks.

It's said that crying at work is a big no-no, simply because your colleagues or boss may think poorly of you. And when it comes to interviewing, crying is an even bigger taboo.

That's because you only have a handful of minutes to impress a stranger who is judging you based on first impressions. She may come to the conclusion that you're not emotionally stable and don't do well under pressure.

That is probably not the case at all, and you don't want to risk giving her the wrong impression. Here are some ways to prevent the tears from falling:

1. Practice interviews: Go on as many interviews as you can, even for the jobs you don't want. Interviews are high-pressure situations in which you'll be put on the spot. Doing more of them will help you get used to it and master better interviewing skills.

2. Don't touch sensitive topics: Do your best not to talk about topics that will emotionally upset you. Come up with a different answer that won't touch upon a sensitive subject.

3. Rehearse your response: If you know you tend to be emotional about a certain topic, then keep rehearsing your answer. Talk it out to yourself and to your friends. Repeat it over and over until you can talk about it without getting upset. But remember to follow the point above, and always try to avoid the topic if you can. And if you do talk about it, then try to come up with a way to deftly switch the topic.

4. Get good sleep and exercise: A good mental state is dependent on how you're treating yourself. This means getting plenty of sleep, eating well, and exercising.

5. Breathe: Deep breathing can be extremely calming, because it relaxes your whole body. Try your best to discreetly take deep breaths throughout the interview so you'll be in a calmer state. If you have to talk about a sensitive topic, then take a deep breath before doing so.

6. Take some time off: If there is something extremely emotional going on in your life, then you should consider taking some time off the interview rounds if you can afford it. Sometimes you just need to give yourself a break.

Have you ever cried during an interview?

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California's $350-A-Year Auto Insurance Plan Could Be A Massive Flop

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The 405

As California goes, so goes the nation.

From auto-emissions standards to bike-helmet laws, it's the innovative legislators in California who often set the tone for the country. Now, insurance experts are looking west for a way to reduce the number of uninsured drivers on the country's roads.

In some states, more than 25 percent of drivers are tooling around without so much as liability coverage.

While most states require drivers to prove financial responsibility in one form or another, the threat of a fine or suspended license can't squeeze blood from a turnip. Younger people pay more but can afford coverage least. (See "This is as cheap as insurance gets."). Many weigh the risks and spend the money on other essentials.

[Let CarInsurance.com help you find affordable auto insurance now.]

So what's California's insurance innovation? Its Low Cost Automobile Insurance Program allows low-income residents with good driving records to buy reduced coverage at a reduced price: $350 or less per year. Drivers also get the option to buy uninsured motorist coverage.

Yet only a fraction of those who might qualify for the program use it.

A unique experiment

The Low Cost Automobile Insurance Program is managed by the state of California, but it uses no taxpayer money.

Insurance companies volunteer to sell the coverage directly, just as with other policies. In return, companies get to add customers to their rolls - - customers likely to either purchase upgrades or stick with the company when they're able to afford full coverage later.

Most participants in California's low-cost plan stay only temporarily, migrating to standard coverage when their financial situation improves. An estimated 66,000 drivers have used the low-cost program since it launched in the test cities of San Francisco and Los Angeles and expanded statewide in 2007.

"The program provides a lifeline for lower-income folks who really want to do the right thing but are facing the choice of putting food on the table or buying auto insurance," says Pat McConahay, spokesperson for the state's Department of Insurance. "It's a program that people don't stay on for life. It's to help them through a difficult time, hopefully."

California may be the only state with such a program. Nevada tried, and failed, to pass similar legislation last year. And while several states offer publicly funded options that help Medicaid or Medicare recipients with accident-related medical bills under no-fault laws, none of the options covers liability.

Yet Californians have either been unaware of the program or unable to navigate its administrative complexities. While an estimated 15 percent of California drivers, or about 4 million people, are believed to now operate without auto insurance, only 11,000 drivers currently are enrolled in the low-cost program.

A bargain, but not for everybody

Why hasn't the program taken off? Clearly, the billions spent in advertising standard auto insurance helps drown out any marketing of the California plan, says Pete Moraga, spokesperson for the Insurance Information Network of California (IINC). "All you have to do is turn on the TV and … you're going to see a commercial for the Good Neighbor, the Good Hands People, the Good Lizard or the Good Flo," he says. "That's a lot of competition for the same eyeballs."

Drivers who do investigate may find rates are not much cheaper in the low-cost program. The low-cost program accepts only good drivers with relatively inexpensive cars -- the same people who would find the best rates on the open market.

To qualify, drivers must:

  • Not have annual income exceeding $27,925 for a single person, on up to $57,626 for a family of four.
  • Drive a car valued at less than $20,000.
  • Have no more than one point on their driving record.
  • Be at least 19 years old and have three years of driving experience.

The program guarantees rates under $350 per year, and in many areas the cost is less than $300 annually. (The IINC offers this county-by-county look at rates.) For example, a driver in Los Angeles would pay $347.

But someone who shopped and compared insurance quotes might find similarly cheap coverage among standard policies. Even in California's priciest ZIP code for auto insurance, basic liability policies from major insurance carriers for a 40-year-old with a clean record range from $369 to $1,845.

A driver in the low-cost program gets less protection when compared to drivers with standard insurance. The low-cost program offers $10,000 in bodily injury liability per person, $20,000 per accident and $3,000 in property damage liability -- less than California's minimum standard liability limits of $15,000/$30,000/$5,000.

But for many, the program will be the cheapest way to stay on the road legally.

Getting the message out

To boost enrollment, California has launched a kind of auto-insurance publicity tour, rolling out billboards, television and radio ads, newspaper editorials and posters on buses. The state passed legislation to allow consumers to buy coverage directly online, and the premium prices have dropped even further.

This spring, the program got an unexpected nod - and subsequent jolt - from the Consumer Federation of America. The organization issued a report that highlighted the California program as one of few bright spots in an otherwise inhospitable marketplace for low-income drivers, who depend on their cars as surely as they depend on their jobs. (See "Car insurers overcharge poor, watchdog says.")

The National Association of Insurance Commissioners subsequently formed a group to study exactly what, if anything, states and insurance companies are doing to ensure that auto insurance is affordable to everyone on the road.

"As government, we have an obligation that if we're requiring people to buy a certain coverage, that they have access, and a component of access is affordability," says Massachusetts Insurance Commissioner Joseph Murphy, who serves as vice chair of the NAIC task force.

Massachusetts has the lowest rate of uninsured drivers, about 2 percent, due in part to strict enforcement.

Yet no program can reach everyone, Moraga says. "Even if you gave auto insurance away, you would still have people that for whatever reason - lifelong scofflaws, felons or just too lazy - would not take advantage of the program," he says.

See more on CarInsurance.com: 

What will make drivers stop texting?

Valets gone wild: Who pays?

Proof of insurance: Paper or plastic?

SEE ALSO: What couples should know before buying a car > 

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Yes, You Can Make Millions By Hosting Garage Sales

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garage-sale-vinyl-rummage

Aaron LaPedis threw his first garage sale at age seven and has been buying and selling items ever since. In fact, he made his first million dollars by "flipping" garage-sale finds and used that money to open an art gallery in Denver.

This "garage sale millionaire" writes a monthly column for The Denver Post and hosted a PBS TV show on collectibles. Wiley releases the second edition of LaPedis' book, The Garage Sale Millionaire: Make Money with Hidden Finds from Garage Sales to Storage Unit Auctions and Everything in Between, in June.

[See 10 Ways to Give Your Money a Makeover.]

With yard-sale season upon us, U.S. News chatted with LaPedis about his strategies for pricing items, spotting money-making opportunities, and more. Excerpts:

How did you get into garage sales?

All I really knew when I was seven was comic books and baseball cards, and that's what I started with. When we had our first garage sale with my mother, my mom said "we've got to go through all your toys and whatever toys you don't want anymore, we're going to sell them, and I'm going to sell some stuff in the house that we don't need and whatever money we make is the only money that you can use for new toys."

The sale did so well that around noon, we had nothing else to sell. So when my mother went to make lunch, she told me I was in control and to make sure we keep on selling. I went to the house and went to the living room and took some lamps, end tables, and some other stuff I could lift and brought onto the front lawn and sold that stuff. It wasn't until the next day that she realized I sold half of her stuff in the living room.

Instead of paying full-price for items, we'd go to other garage sales and I started seeing all these comic books and baseball cards and other toys, and from there I went to coins. I started buying and selling silver dollars and stuff like that. Between age seven to 25, I made my first million from garage sales, estate sales, and second-hand stores, buying and flipping stuff. I took all the money I made and flipped that into starting an art gallery.

[See How to Save Money on Toys for Your Kids.]

What are your strategies for pricing items?

I believe getting the other person talking starts to bring down the barriers. So anything under $15, I don't believe in pricing it. If there's no price, they're going to ask, "How much is this item?" and your follow-up would be, "What are you willing to pay for it?" They will come back to you with an amount of money and that's where you can start negotiating.

A lot times when you don't price items, you may get more than what you were hoping for, but this way, guaranteed, it will trigger a conversation between you and the buyer. Most of everybody's yard-sale stuff is under $15, so it's usually time-consuming to price all those little things. Now, if you have items above $15 to $20, you want to price it because people will offer you a lot less than what you're going to want.

What would you say to people who still think a garage sale is too time-consuming, so it's better to just donate the items to charity and take the tax deduction?

You do a garage sale for several reasons. First, I believe it is a great way of not only meeting your neighbors, but making money. You go through your house, and not only are you cleaning out your house, you're going to make money. So you have this garage sale and if you do it right, you can make anywhere from $500 to $1,500. And then you take that money and flip it into going to second-hand stores and estate sales and finding collectibles or items that can be instantly flipped into more money. I encourage people to do a garage sale, but at the end of the garage sale, you bag up everything that didn't sell and then give it to a Salvation Army or a local charity that you think could use it.

What tips would you offer readers who might be planning garage sales this summer?

Signs. The No. 1 thing that people screw up is they don't put out enough signs, or else they're the cheap ones. You need big three-by-three signs that are bright at intersections, and you need 15 to 20 of them. The other tip is using your Facebook. You need to let people know on Facebook that you're having a garage sale. There's also an app called TagSellIt.com where you can add your garage sale for free or you can look up garage sales in your area for free.

[See How to Stop Feeling Broke.]

What about people who are going to garage sales in the hopes of flipping items? What are the hot collectibles they could be making money on?

First, you need to make sure you bring your smartphone, because this is the way you figure out if you're getting a good deal. I believe in antiques, tin toys, old comic books, old fishing gear, old tools, stuff like that. Really high-grade stereo equipment that is in perfect condition or if it has the box it came with, you can easily flip that on eBay and Craigslist.

If your expertise is old records, then you should become fluent in old records, for the Beatles or Led Zeppelin or jazz because a lot of those vinyl records are worth a lot of money, but then there are a lot of them that are worth nothing. Being an expert in two or three things would really help you be a weapon at garage sales.

Usually when we talk about flipping a house, there's a lot of "sweat equity" involved. When you talk about flipping furniture or other items, are you restoring or repairing it?

If it's antique furniture, you do nothing except for dusting it off to maybe tightening things. Restorations on antique furniture could be very, very costly, meaning that you would take away value of that item, so you more just want to clean it off and make it look as good as you can without changing the overall look.

With newer items like maybe a bike, say, you buy a bike for $20 and you know it's worth $120, you could fix the flat tire, put a chain on, or tighten things. That's all fine. But you don't want to put in too much money, or else you're cutting into your profits.

With consignment stores, yard sales, eBay, and Craigslist, people have a lot of different options for reselling items nowadays. Which avenue should you choose?

Big furniture is really, really hard to sell on eBay because everybody wants it shipped and that's a nightmare, so that could be really perfect on craigslist, which is free. eBay does charge you, so between when you sell an item, you're paying anywhere from 6 to 9 percent of that item in PayPal fees.

You do not have an antique store or another consignment shop sell your stuff. They take too much of a percentage and then they're only getting people that come into their shop or their closest clients. You need to eliminate the middleman, and you'll make more money if you go and sell it yourself.

DON'T MISS: These collectible crazes cost us a ton >

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Why You Should Hate Credit Card Rewards Points

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When you think about it, credit card rewards points are kind of like middle-class crack. The card companies get us hooked with a huge initial dose and then charge us an insane premium when we come back for more. And the sad part is that we always come back for more.

Many times, card issuers only allow you to redeem your points at certain checkpoints, and when you do, it’s not uncommon to find that you haven’t really earned enough to buy any of those cool prizes they advertise. And that’s not even the worst part. Here are four reasons why we sometimes hate the way credit card rewards points work.

1)    The accumulation rates stink. That first 40,000-point “signing bonus” may seem impressive, but after that, your card’s rewards points will multiply more slowly than the guests at a Bank Appreciation Day event. At most, you’ll earn five points for every dollar you spend, but that’s only if you have a card that features one of those variable categories schemes and if you happen to be buying something from said categories. Otherwise, you’ll likely earn about one point for every dollar spent. So if you ever want to rack up another 40 grand in points, you’ll have to charge $40,000 to your card.

2)    A point isn’t necessarily worth a dollar. Though a rewards point costs a dollar to earn, in some cases it’s worth less than a dollar when you try to spend it. For instance, Citi’s ThankYou Rewards program charges cardholders 28,500 points for a new 160 GB iPod Classic. That translates to $285. Walk into any Wal-Mart in the country and you can have that same iPod for only $229.

Citi isn’t even the worst offender. You know those 50,000 bonus points you earned from your new Chase Sapphire card? Yeah, those are only good for $625 in travel expenses. That puts the monetary value of a bonus point at about 1.2 cents. But hey, they’re free right? Well, not exactly, because…

3)    Rewards make you spend more than you would otherwise. Though card companies don’t charge you for your bonus points, the opportunity cost of racking up rewards can’t be ignored. It’s not just that you have to spend with your card to earn points. It’s that you have to spend a lot, even to get those signing bonus points.

According to a recent Nilson report, people with standard cards spent an average of $465 a month. People with the same credit rating and a rewards card spent $890. Why? Because most schemes make cardholders spend between $1,000 and $2,000 within the first three months to get that large signing bonus. After that, point values depreciate so much that the consumer habitually overspends to earn more points.

4)    There’s always a catchAirline credit cards might not subject their points to expiration and blackout dates like they used to, but that doesn’t mean there isn’t a catch to earning rewards. If you have a cash rewards card, your card issuer will only cut you a check after you earn $25 in points, or sometimes only at the end of the year. If you use Citi’s ThankYou program, you can only redeem your points for one of Citi’s overpriced prizes. And if you want to choose your rewards with the American Express Zync card, you’ll have to pay up to $25 to add a categorical “package” to your scheme.

Credit card rewards work a lot like those carnival game ticket schemes you always fell for when you were little. You spend all day and all of your savings earning 10,000 tickets only to find out that a set of those cheap neon plastic vampire teeth costs 11,000. So while credit card rewards aren’t a bad thing – as long as you’re not one of those people who overspend to earn more points – you probably shouldn’t structure your life around them.

DON'T MISS: 10 essential carry-on items that will save you time and money >

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The Federal Reserve's Policies Ruined Any Chance We Had Of Cleansing The Economy

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Printing Money Printing Press Money Quantitative Easing

Since the lousy jobs report, there has been a veritable orgy of Fed Speak with juicy morsels and contradictions, interspersed with leaks and rumors, that climaxed with Chairman Ben Bernanke’s words of wisdom before the Congressional Joint Economic Committee.

It whipped markets into a frenzy, drove the Dow up 500 points, knocked yields into historic basements, and caused gold, the safe-haven investment, to bounce up and down like a rubber ball. All this was peppered with the impending collapse and bailout of Spanish banks and an endless litany of other problems in the Eurozone whose miasma is drifting across the Atlantic and might infect the presidential campaign.

Yet Bernanke wasn’t totally gung-ho about more Quantitative Easing. The “economy must be monitored closely,” he said instead of promising the immediate restart of the printing press.

On Tuesday, it was Richard Fisher, President of the Dallas Fed, who came out swinging against more quantitative easing despite the “hue and cry of financial markets.” He blamed the federal government for lack of direction in its tax and spending policies that leave businesses mired in uncertainty.

The same day, James Bullard, President of the St. Louis Fed, didn’t think the jobs situation and the broader economy was bad enough for the Fed to pile into another round of ineffectual QE—maybe they were trying to stay out of a political minefield. Read.... Squeezing the Fed from both Sides.

On Wednesday, Vice Chair Janet Yellen took the opposite tack. Citing the still dismal job and housing markets, she pushed for more QE and more interest rate manipulation for an even longer period, probably for all times to come—ironically because the job and housing markets are precisely the markets that have not recovered since the Fed started its QE programs and zero-interest-rate policy (ZIRP) in December 2008, along with its massive corporate and bank bailouts.

The effect of the Fed’s policies on the job market can best be seen through the Employment-Population ratio, which measures the percentage of people age 16 and older who have jobs. It’s not perfect. But it’s the least corrupted employment number out there: it’s not seasonally adjusted, manipulated by the infamous “Birth Death Adjustment,” or mucked up in other ways. After peaking in April 2000 at 64.7%, it now hovers near its 30-year low—despite, or because of, the Fed’s policies:

 

The beneficial impact of QE and ZIRP on the housing market can best be seen through the Case-Shiller 20-City Composite home price index. Note the new multi-year low at the end of the line—despite the Fed’s gyrations and manipulations, and despite record low 30-year mortgage rates:

 

So, how can anyone still couch the justification for QE and ZIRP in the fatuous language of job creation and housing market recovery? The Fed employs an army of number-crunchers who know all this. Yellen and Bernanke also know that the impact of QE and ZIRP on jobs and housing has been nil, or even a negative.

However, QE and ZIRP have had a colossal impact, and not just on the financial markets and the status-quo banking system that caused the financial crisis, and on capitalism and free markets as a whole, which no longer exist, but also on the real economy.

A friend of mine is a partner at a restructuring firm. Their specialty was to take companies that were cratering and restructure them back to health. Typically, they were paid by creditors that had ended up with these companies. But a couple of years ago, his firm had to reinvent itself. With boundless amounts of money floating through the system, and with yields being so low, creditors had become enamored with “extend and pretend” where, instead of recognizing losses on these defunct loans, they would simply offer forbearance agreements, issue new loans, and pretend everything was fine.

These companies are still out there, un-restructured, burdened with even more debt. The rejuvenation and cleansing process that debt-fueled capitalism needs from time to time to get rid of management deadwood, too much debt, and other problems, and that wipes out equity holders and makes creditors come to grips with reality, has not taken place—though millions of workers have been axed. The energy and job growth that would normally sprout from the ashes have mostly faltered. And my friend, to stay relevant, became an expert in performance improvement to help entrenched management stay in place.

While preventing the economy from going through its necessary cleansing process—and the heavy losses associated with it—the Fed’s policies have in spectacular fashion enabled Congress to run up gargantuan deficits year after year that make the Eurozone, now ravaged by a debt crisis, look virtuous. Sen. Jim DeMint, a South Carolina Republican, tried to politely nudge Chairman Bernanke on that, but he shrugged it off. And Congress will once again shrug off Bernanke’s suggestion that it needs to come up, as he said, with a “sustainable” deficit—a term that has replaced the concept of “balanced budget.”

And here is a hilarious cartoon Ben Garrison about what happened to Ron Paul when he hit one out of the  ballpark.... “Ron Paul Hits A Home Run.”

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CEOs Are The Only People Who Care About Corporate Logos

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New Twitter Logo

There are three things the CEO’s running Corporate America truly care about. The size of their pay package, which usually enjoys an inverse relationship to their company’s revenues, profits and stock performance.

How many golf tournaments they can convince their handpicked boards of directors to sponsor that will reward them with a personal one-on-one round with Tiger… And the company logo.

Why the company logo? Because unlike the general public, these Captains of Industry see the damn thing all the time. It’s on their stationary; it’s on the napkins their drinks are served on aboard their corporate jet; it’s embossed on their golf bag, it’s even on the Annual Report.

To the CEO, the logo is a big deal. That’s why they fuss over it, and that’s why lots of “Corporate Design Gurus” make dumpster loads of money by noodling barely discernible graphic changes to something that looked just fine a few million dollars ago.

This last week, we have been treated to the re-designed Twitter logo. Which looks exactly like the old logo, except they’ve shaved off its forelock and made it a slightly darker shade of blue. However, in the words of Twitter’s Creative Director

Our new bird grows out of love for ornithology, design within creative constraints, and simple geometry. This bird is crafted purely from three sets of overlapping circles — similar to how your networks, interests and ideas connect and intersect with peers and friends. Whether soaring high above the earth to take in a broad view, or flocking with other birds to achieve a common purpose, a bird in flight is the ultimate representation of freedom, hope and limitless possibility.”

Oh yes indeed! Now you know what a Creative Director does at Twitter to earn his forthcoming IPO millions.

The whole preciousness of this kind of thinking is best summed up in a wonderful Goodby Silverstein + Partners video of their first experience with Twitter. In the prescient words of Rich Silverstein… “Lose the bird… Just lose the bird!”

Meantime, over at Pepsi, further proof that Corporate America does not learn from the lessons of history with the news that they have just appointed Mauro Porcini as their “Chief Design Officer.” We are told that “his reach will extend from package design to advertising, industrial design and digital experiences.” Obviously, this will include the logo, and stupid me naively thought that Mr. Porcini’s primary expertise was in mushroom farming!

It just goes to show how little I know! And yet, it only seems like yesterday since the implosion of ace design guru, Peter Arnell with his multi-million dollar redesign of both Pepsi and Tropicana packaging, which, after it was discovered that the entire universe hated it, cost the company millions more to revert back to the original design.

This in spite of Arnell’s notorious 27 page memo (titled BREATHTAKING Design Strategy)  justifying the new Pepsi logo by equating it with such diverse influences as Feng shui, the Renaissance, the Earth’s magnetic fields and the sun’s radiation. All this for what Steve Jobs once described as fizzy sugared water for kids, when he was persuading John Sculley to jump ship from Pepsi to Apple.

Many years ago, while freelancing on the Xerox account at Y&R, I attended a meeting at Xerox corporate headquarters for the unveiling of their new corporate design and logo. This had taken several months and several million dollars sunk into the bottomless pit of a world famous design company, and was intended to finally put the nail in the coffin lid of the commonly held perception that all Xerox did was make copiers.

Something which, even today, after expending billions of marketing dollars, the vast majority of people still think is their primary business. On the day, a hundred or so people assembled for the presentation. As usual, this required a “set-up” involving many Power Point slides, lots of graphics and the mind numbing presentation of “insights” that were blindingly obvious. But finally, the big moment came.            

The world famous Design Company’s recommendation was that from this time forward everything should be signed as… “The Document Company – Xerox.” There was moment of stunned silence, and then someone grabbed a hand mike and shouted… “But that’s what we’ve always called ourselves.” “No,” replied the world famous design guru. “You’ve always said you are, “Xerox – The Document Company.” We’ve changed the emphasis.”

And that’s worth five million dollars of any CEO’s money. Particularly as in reality, it’s not his or hers, it’s the shareholders. So it won’t affect their next “Performance” bonus.

And always remember… If in doubt… Make the logo bigger.

George Parker has spent more than 40 years on Madison Avenue. He’s won Lions, CLIOs, EFFIES, and the David Ogilvy Award. His blog is adscam.typepad.com, which he describes as, “required reading for those looking for a piss & vinegar view of the world’s second oldest profession.” His latest book, "Confessions of a Mad Man," makes the TV show “Mad Men” look like “Sesame Street.”

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Now Even The Fake ID Business Has Been Outsourced

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Fake ID traffic sign

Overseas forgers from as far away as China are shipping fake driver's license and other IDs to the United States that can bypass even the newest electronic digital security systems, according to document security experts.

The new IDs are "an affront to the very sovereignty and dignity of the states that issue them," says David Huff, a senior special agent in enforcement for Virginia's Department of Alcohol and Beverage Control, which has investigated some of the frauds.

Most troubling to authorities is the sophistication of the forgeries: Digital holograms are replicated, PVC plastic identical to that found in credit cards is used, and ink appearing only under ultraviolet light is stamped onto the cards.

Each of those manufacturing methods helps the IDs defeat security measures aimed at identifying forged documents.

The overseas forgers are bold enough to sell their wares on websites, USA TODAY research finds. Anyone with an Internet connection and $75 to $200 can order their personalized ID card online from such companies as "ID Chief." Buyers pick the state, address, name and send in a scanned photo and signature to complete their profile.

ID Chief, whose website is based in China, responds personally to each buyer with a money-order request.

Brian Zimmer, president of the Coalition for a Secure Driver's License, said the ease with which people can get fake documents is alarming. "If the ID buyers are terrorists, the list of protected targets they can now access is a Homeland Security nightmare," he said.

In August of 2011, federal prosecutors uncovered a counterfeit ring of Chinese foreign nationals in Albuquerque forging New Mexico IDs for illegal Chinese immigrants. They ran advertisements in Chinese-language newspapers in New York offering false identification for $1,500.

The website "Link-i-d" is another popular source of identification registered in Panama. According to its website, the company sells ID cards that will pass security scans and have accurate holograms and ultraviolet-sensitive ink. Customers can send a money order of $100 for two cards. The website launched this year.

ID Chief in particular is a major source of concern because the IDs are cheap, easy to obtain and entirely legal -- until buyers use it to lie about their age. The risks go beyond easier underage drinking.

The security risks include immigration, employment verification and, most important, aviation security, said Andrew Meehan, a policy analyst for the Coalition for a Secure Driver's License. He said the most concerning threat is that the U.S. government can do very little about it.

"Short of filing a complaint to the World Trade Organization, the request has to be made to the Chinese government," he said.

According to Huff of the Virginia agency, it has always been easy for the untrained eye to be fooled by fake IDs. The difference is, Huff said, that the new generation of forged IDs is "good enough to fool the trained eye."

For buyers from ID Chief and other companies, the easy-to-use online form does not come without risk. Buyers have reported identity theft and hundreds of thousands of dollars of debt in their names after buying from the Chinese forgers, authorities say.

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Warner Bros. TV Is Buying Alloy Entertainment

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warner brothers logo

Warner Bros. Television Group is buying Alloy Entertainment, with which it already collaborates on shows including "Gossip Girl," "The Vampire Diaries" and the upcoming "666 Park Avenue."

WBTVG has signed a deal to acquire Alloy from an investor group led by ZelnickMedia. Leslie Morgenstein, who has served as president of Alloy Entertainment and its predecessor, 17th Street Productions, Inc., since 1999, will stay on to run the company within WBTVG.

The closing of the transaction is expected in the third quarter of the year. Terms were not disclosed. 

Five of Alloy Entertainment’s properties are produced and distributed by WBTVG: CW's “Gossip Girl” and “The Vampire Diaries,” ABC Family's “Pretty Little Liars” and “The Lying Game,” and ABC's upcoming “666 Park Avenue.” All started as book franchises aimed at teen girls and young women.

Alloy Entertainment film properties included two “Sisterhood of the Traveling Pants” films for Warner Bros. Pictures and “The Clique” for Warner Premiere.

About 50 Alloy Entertainment properties have hit New York Times bestseller status, including "The Sisterhood of the Traveling Pants," "Gossip Girl," "The Clique," "The Luxe" and "Pretty Little Liars."

SEE ALSO: Movie scenes recreated by Legos > 

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TMNT: The Complete History Of Everyone's Favorite Pizza-Loving, Radioactive Turtles

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If you were a kid in the 1980s or 90s, you probably spent some time reading, watching, or playing with four adolescent reptilian martial arts experts with irregular DNA.

To make sure I got the scoop on everyone’s favorite heroes in a half-shell, I went straight to the source—co-creator Peter Laird—who was kind enough to answer our burning questions about the franchise. If you’re looking for a thorough history of the Teenage Mutant Ninja Turtles, this is a pretty good place to start. 

Check out the complete history of the Teenage Mutant Ninja Turtles >

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Artists Kevin Eastman and Peter Laird created TMNT in 1983.

Struggling artists Kevin Eastman and Peter Laird were living in Northampton, Massachusetts, when they came up with the Turtles in November 1983.

As a joke, Eastman drew a turtle standing on its hind legs, wearing a mask, with nunchucks strapped to its arms. Eastman wrote “Ninja Turtle” on the top of the page. Laird laughed and then drew a more refined version of the turtle.

Not to be outdone, Eastman drew four turtles, each armed with a ninja-style weapon. Laird outlined the group shot in ink and added “Teenage Mutant” to the “Ninja Turtles” title.

As Eastman and Laird began fleshing out the Turtles to create a comic book, they had to give the Turtles names. At first they tried Japanese names, but it just wasn’t working. So they tried great Renaissance artists instead – Leonardo, Raphael, Donatello, and Michelangelo. Laird told me, “It felt just quirky enough to fit the concept.”

In May 2012, that original drawing of the Turtles sold at auction for $71,700.

 

Check out 18 Fabulous Photos of Famous Flappers at mental_floss.



The first comic book sold 3,000 copies within a few weeks, making it an instant success.

In March 1984, Eastman and Laird created a new company, Mirage Studios, so named because there was no actual studio other than Laird’s living room. Then, Eastman used his $500 tax return, Laird emptied his bank account of $200, and they borrowed $1300 from Eastman’s uncle to print 3,000 copies of their first comic book, Teenage Mutant Ninja Turtles. After printing costs, they had just enough money left to run an ad in Comics Buyer’s Guide Magazine, an industry publication.

Thanks to that one ad, comic distributors across the country started calling, and Mirage sold all 3,000 copies within a few weeks. With more orders coming in, they printed another 6,000 copies and easily sold through those, too. By May, they’d made enough money to pay back Eastman’s uncle and split a roughly $200 profit.

Although the comic was meant to be a “one-shot,” a single issue, self-contained story, they realized they might be on to something. So, in January 1985, they completed issue #2 and quickly received orders for 15,000 copies, which was so successful that distributors demanded 30,000 reprints of #1, and even more of a second print of #2. #3 fetched orders totaling 50,000 copies, and sales continued to climb, peaking at issue #8, which sold 135,000 copies thanks to a guest appearance by Dave Sim’s character Cerebus, a barbarian aardvark.

The first issue of the comic originally sold for $1.50. But if you’re looking for a first-print copy of TMNT #1 today, it’ll cost you in the neighborhood of $2,500—$4,000.



The Teenage Mutuant Ninja Turtle brand started to expand in the late '80s.

  • TMNT ran under the Mirage Studios banner from 1984-1995 for 75 regular issues, as well as dozens of mini-series, one-shots, and limited series spin-off titles.
  • Archie Comics used the cartoon Turtles for 72 issues of Teenage Mutant Ninja Turtles Adventures, which ran from 1988—1995.
  • The Mirage Turtles moved to Image Comics in 1996 for 13 issues and a mini-series, before being canceled in 1999. While at Image, the series took some odd turns: Splinter became a bat, Donatello changed into a cyborg, Leonardo lost a hand, and Raph became the new Shredder.
  • When Peter Laird brought the Turtles back to Mirage in 2001, he completely ignored the Image years and they are no longer considered part of the TMNT canon. His new series ran until 2010 with 30 issues in print, and #31 available only online. Although the series was not officially concluded, Laird has no immediate plans to publish more.
  • Since August 2011, publisher IDW has been running a new TMNTcomic, featuring artwork from co-creator Kevin Eastman.

Check out Test-Tube-to-Table: 11 Up-and-Coming Genetically Engineered Animals at mental_floss.



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How Did Broadway Tickets Get So Expensive?

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Broadway Statsitcs

The most basic thing to say* about why theater tickets are expensive to buy is that theater is expensive to make.

Economist William Baumol famously observed that it's really hard to make a string quartet more efficient, because it's not feasible to replace the live violinist with a robot or with a cheaper Chinese violinist Skyping in from Shanghai.

Similarly, you can't perform "A Long Day's Journey Into Night" with fewer than four principal actors. You also can't make it without a director, or a costume team, or a set designer, and so on. Prices are people, and theater is labor-intensive work, and that makes a night at the theater necessarily an expensive thing to consume.

But it doesn't explain why average paid admission has increased by a fifth since before the recession to $93, according to new statistics from the Broadway League -- nor why non-musical ticket prices grew by about 30%. Here the answer comes from the demand side. Broadway plays and special events are limited-time-only star-studded events that draw lots of rich people. And producers have gotten wise to the idea that rich people are extremely price insensitive when it comes to seeing celebrities on the Great White Way, especially if there's only a short window. The message rich people appear to be sending is: If you charge it, we will pay it.

In 2001, "The Producers" taught real-life producers that theater-goers were willing to pay $500 for a two-plus-hour musical. Since then, more shows have started using dynamic pricing to charge the most when they expect demand to be strongest. Last year, "Hugh Jackman: Back on Broadway" (a one-man show, which is as labor-efficient as you can get) made $1,468,189 for eight performances, a record for its theater.

The limited-engagement star-studded show, which can push $600 a pop, is a perfect storm for high prices. Covering the celebrity's pay check and the cost of the space requires producers to charge high prices to cover the costs in a short period. The short run itself creates scarcity, concentrating audience interest in a small window where they're less price sensitive.

But perhaps the key factor is that prices rise as long as people will pay them, and if the 1% is willing to pay $400, $500, and $600 for one night's entertainment, average prices will continue to rise as producers experiment with ways to price dynamically and take advantage of rich folks' love of the theater. Throw in the rise of tourism to New York is -- up 8% since 2008 -- and you're a long way toward understanding why Broadway ticket prices are going to keep going up as long as the rich keep getting rich. If rich people want to pay $600 for one night at the theater, who are producers to try and stop them?

_____
*I've just moved to New York, and so to make myself feel at home in this strange and hyper-kinetic city, I decided to make my first city post about the most obvious of New York topics: complaining about how expensive things are. And compound the cliche, I'm going to talk about Broadway. Sorry. This won't be a habit.

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A Woman Asked Her Doorman To Break Up With Her Boyfriend For Her

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DoormanOur latest anonymous interviewee, 34, has seen it all from where he stands guard over a high-end Midtown West co-op.

From husbands hiring private detectives to spy on their wives to potentially threatening situations, there is nothing this doorman hasn’t experienced.  

Here’s what he had to tell us about dealing with dangerous characters, being named in a resident's will, and what makes the difference between a good and great tip.  

What drew you to becoming a doorman?
My father was a doorman and my brother works in the building so they were able to get me in.

What’s the hardest thing a resident ever asked you to do?
A tenant asked me to tell her long term boyfriend that she didn’t want to see him anymore. I had to relay the message and tell the man he couldn’t come in, because he came over every day. I felt like I had no choice.

It was really tough doing that. You kind of form a companionship with these people -- you see them every day. 

Also, one of the other tenants had moved in a couple of years ago with his wife -- they had just gotten married. And one day she opened an envelope in the lobby and there were divorce papers in it.  She started crying and she was talking to me about that.  

And then I had to come between both of them. He hired a detective to spy on her and told me not to tell her about it. I didn’t say anything to her. I didn't want to get any more involved in the situation.

What’s the best tip you’ve ever gotten?
Five-hundred dollars for Christmas. A guy that works in Hollywood who doesn’t live here anymore was generous that year. He didn’t always do that.

Also, one of the older ladies in the building died and left me and a couple of the guys some money in her will. She gave me $3,000. She was a very nice lady, a sweetheart. She was a very lonely woman. She used to talk a lot and a lot of people used to get annoyed but she was very lonely so you have to put that aside.   

She would write nice things to us in our cards during Christmas. Some people just throw money in but she’d remember what you said to her about what was going on in your life.  

If you had to work a holiday what would it be?
I work a lot of them and I don’t really like [it].  But I never worked on New Year’s Eve. That might be cool. You could look down Seventh Avenue and see the ball drop if you’re on the roof of this building.  

I worked Thanksgiving the past three years and people were almost falling through our doors to see the balloons, since the building was on the parade route.

But then it gets out of hand.  People start stepping on our plants. We have our handymen and porters standing three, four feet outside the door, kind of as a barricade so people don’t fall through the door. 

What’s your favorite thing about your job?
I like interacting with people – it’s cool.  It makes the day go a little faster.  Being a doorman can be a little boring, but you see and meet so many different types of people. Plus I get to look outside unlike a handyman or porter -- all they do is stare at pipes or floors. That’s not for me. 

The tips are also great as opposed to what a handyman or porter gets.

Did anything dangerous ever happen?
You do run into some crazy people. I’ve run into so many rude people. Some tenants might have a wild friend or two. Or maybe they buy or sell drugs or something – you never know.

I’ve had one guy come in and he was totally rude and nasty. He wanted to go up to a tenant’s apartment and they didn’t want to let him in and he got in my face and was screaming at me and then he started spitting at the window.  You don’t want to fight the guy because you could lose your job by hitting someone. The mailman had to get in between me and that guy. He was really animated and making a scene and cursing. I basically opened the door and waited for him to get out.  

You never want it to lead to any physical contact.

Best thing about neighborhood: It’s relatively safe and kind of quiet. It’s near Carnegie Hall.  Pretty much anything you need is right around the area. You can get any means of transportation  -- the N, R, Q and W is right around corner and a block away is Columbus Circle, where you can get the A,C,1, and  9 trains. 

Worst thing about neighborhood: It’s a tourist attraction area and that gets a little frustrating. You have some tourists who want to look inside the building--it has a very old Italian deco lobby--and that gets annoying. People argue with you when you tell them that they can’t come in. But it comes with the territory and you get used to it. 

Has the neighborhood changed a lot over the years?
It’s pretty much been the same except that there are a lot less homeless people than there used to be.

Best dry cleaner: A lot of people in the building use Grace Cleaners (on Seventh avenue between 57th and 58th Streets).  A lot of people have problems with the expense but it’s convenient.  

Best restaurants: You have an Italian restaurant, Trattoria Dell'Arte (Seventh Avenue between 56th and 57th Streets). Their food is really good but a little pricey. They have great lasagna and Italian dishes.

You also have Red Eye Grill (Seventh Avenue between 57th and 58th Streets), which is pricey, and Brooklyn Diner (57th Street between Seventh and 8th Avenues), which is also pricey and a tourist attraction.  All of them have pretty good food though. There’s also a little café, La Parisienne (Seventh Avenue between 57th and 58th Streets) – it’s good for a little breakfast.

I like Carnegie Deli (Seventh Avenue between 54th and 55th Streets) – it’s expensive but I love the food there. Their tuna fish and pastrami sandwiches are my favorite. They make stuff that’s like, sized for a family – they’ll give you a sandwich and it’ll take you three days to eat it. 

Best quick bite: Hale and Hearty (on 56th street between Fifth and Sixth Avenues). Morton Williams Supermarket (on 57th Street between Seventh and Eighth Avenues) as well -- their chicken salad is good. 

Would you live in this building if you could? 
To be honest with you, not really. This type of building is not for me. Don’t get me wrong – the building itself is beautiful, but I can’t say I’d fit in over here.  It’s very private and quiet.  

The funny part about this building is that I bet there are tenants who have lived here for 30, 40 years and don’t know who some of their neighbors are. Everybody does their thing, it’s strange. A lot of people don’t like to come to board meetings or gatherings.

Everybody always comes up and asks me, how do you know every face? And I say, it’s part of my job.  I’m security -- I have to know who comes in and out and where they plan on going.  

What’s the worst part of your job?
I’d like there to be signs outside the building telling people it’s a private residence -- that would make my job a little easier. A lot of people don’t want to take my word for it so they’ll argue with me.  I don’t really have problems with tenants in the building as opposed to random people on the street who kind of look down on you and want to walk past you. That gets aggravating.  

Or even a simple thing -- a lot of messengers don’t want to go into our service entrance and so they argue with you because you don’t want to accept the package. Everything has to be put in the computer system over here but they don’t understand that and I don’t want to sit there and tell them about it. That’s a little frustrating.

Some of the tenants don’t know what you go through and some people just don’t care – but that’s the way it goes. That’s how a lot of jobs are and I’ve learned that.


Tips from a Doorman features interviews with assorted New York City doormen, in an effort to get the inside scoop on the best (sometimes hidden) gems in their work neighborhoods. 'Cuz who knows a neighborhood better than its doormen(women)?

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BEST IN SHOW: The 12 Most Expensive Dog Breeds In The World

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They are lovable, loyal and are considered man's best friend. But would you fork thousands or millions to buy one?

For billionaires, any dog will not do. It’s not only the pooch that matters but its lineage as well.

Here's our list of the priciest puppies up for grabs for the elite dog lover.

Check out the 12 most expensive dog breeds in the world >

Tibetan Mastiff

Price: $2,200—$7,000.

The most expensive dog in the world was a Tibetan Mastiff called Big Splash. He was sold for $1.5 million to a Chinese coal baron. The massive build of a Tibetan Mastiff hides a loyal, calm and good-natured pet. The breed loves open spaces—a farmhouse or a sprawling bungalow is perfect for this big ball of fur (they are known to weigh as much as a 100 kgs).



French Mastiff

Price: $3,000

A breed slightly easier to procure than the Tibetan variety, the French Mastiff grows up to be a strong and imposing dog. Pure brawn and high maintenance, the French Mastiff is often considered as status symbols by the elite. Salman Khan popularly named his two French Mastiffs "Myson and Myjaan."



Pembroke Welsh Corgi

Price: $1,000

The Welsh Corgi has a folklore attached to its breed; according to legend, it served as a steed for fairies (hence the saddle-like pattern on it coat). Most famous for being the favorite breed of Queen Elizabeth II, the Corgi has been the most preferred pet of British royalty for more than seven decades. Its price matches its elite status—the pint sized pooch costs at least $1,000, but may increase depending on breed and pure blood line.



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