Archive for November, 2009

Book Review: Understanding Wall Street

November 12, 2009

[Front Cover of Understanding Wall Street]

I was surprised to learn that this book by Jeffrey Little and Lucien Rhodes was first published over 30 years ago, is now in its fifth edition and has sold over one million copies. I say surprised because I hadn’t even heard of the book in all these years of writing the blog and reading (or at least being aware of) pretty much every popular book on personal finance and investing out there. After reading the book, I don’t find its popularity and longevity surprising at all — it is an excellent primer on stocks, bonds, options, exchange-traded funds, precious metals etc.

The authors have packed a vast range of topics ranging from financial manias to the history of Wall Street to its many colourful personalities in the book’s 350 odd pages. The result is a valuable reference book that you can turn to whenever you want a quick explanation for an investment concept. The book is filled with delightful sidebars, photographs, newspaper clippings, charts and graphics. For instance, a sidebar on the profitability of selected industries shows that Broadcasting ranks among the most profitable (almost as much as drugs) and, unsurprisingly, Airlines rank among the least profitable.

The paperback book is published by McGraw Hill and is available from Amazon for $17.50. Amazon’s Look Inside feature allows you to browse through some of the content. In the interest of full disclosure, I should point out that a review copy was provided by the publisher.

TD Canada Trust offers up to $250 cash

November 10, 2009

[Remembrance Day 2009]

TD Canada Trust, which used to attract new customers by offering iPods, is now offering hard, cold cash of up to $250 to customers opening a new bank account. The promotion was initially limited to a few locations but TD Bank has now extended it to all its branches. There are three tiers of cash bonuses on offer:

  1. $100 for opening any chequing account and signing up for direct deposit plus two pre-authorized debits or signing up for TD Bank’s Simply Save.
  2. $150 for opening up an Infinity Account or Select Service Account and fulfilling the above conditions.
  3. $250 for opening up an Infinity or Select Service Account, fulfilling the conditions in (1) and signing up for an approved TD Visa credit card and making ten purchases with it.

It may not make much sense to jump through hoops just to snag the cash offer but if you’ve considered switching to TD Canada Trust for their all-you-can-eat Select Service account, this may be the chance you were waiting for. The Select Service Account comes with unlimited transactions, personal cheques, a small safe deposit box, free US dollar chequing account and annual fees waived for many TD Visa cards. One of these cards, the TD Gold Elite Visa, offers emergency roadside assistance for the card holder and her family. The monthly fee on the Select Service Account is $24.95 which is waived with a monthly balance of $5,000. TD Bank’s offer is tempting because the Select Service Account features that I’m interested in (but don’t currently get for free elsewhere) are worth around $200 per year. Still, I’m inclined to stick to our current banking arrangements as I’m don’t want to constantly watch for the balance dipping below $5,000.

The Sad Story of Nortel LTD Beneficiaries

November 10, 2009


Among the many injustices surrounding Nortel’s bankruptcy — and there are many — the one that is the most heart-wrenching is the uncertainty faced by former employees who are currently disabled and are receiving benefits from the company’s long-term disability (LTD) plan. These unfortunate people made regular contributions to Nortel’s LTD plan — in fact, some employees even made optional contributions to top up their benefits — to secure their financial future in the unlikely event that were to become disabled. Now, they are finding that instead of insuring the LTD plan through a third-party, Nortel decided to “self-insure” and fund the liability through its general revenues. With the company in bankruptcy proceedings, Nortel’s disabled former employees face the prospect of being left with nothing.

It is too easy to simply blame Nortel’s past management for cutting corners with disability benefits. The fact remains that regulations do not require private companies to either set aside funds to meet their LTD plan obligations or pay a third-party to assume these liabilities. It is also shocking to read that governments have been asleep at the wheel despite the same situation playing out at Eaton’s in the 1990s and Massey Combines in the 1980s. Instead of displaying indifference to the fate of Nortel’s disabled employees, our governments have a moral obligation to (a) introduce legislation to protect employees who are members of current LTD plans and (b) ensure that the financial benefits due to disabled employees are paid in full. It is simply the right thing to do.

PS: Check your LTD plan to see if the coverage is provided by a third-party insurance provider. If you can’t find this information, ask your HR department how the plan liabilities are met.

Later: Check out “Are your employee benefits in jeopardy?” for Thicken My Wallet’s take on this issue.