An increasing number of older people are looking to reverse mortgages to boost their cash flow in retirement, according to new figures from a trade group.
The creation of these types of mortgages increased by 4.2 percent during the fiscal year, figures from the National Reverse Mortgage Lenders Association reveal.
Reverse mortgages are available to homeowners over 61 who want to convert some of the equity in their property into cash without selling, giving up the title or remortgaging. Their income from this transaction is tax-free.
The interest in reverse mortgages has been growing over the past several years, with this year’s total of 112,100 setting a new record for loan volume.
Peter Bell, president of the NRMLA, said that the group expects the number of these home loans to grow even higher in the coming years.
"Reverse mortgages are really one of the only positive stories in financial services this year, because they provide a safe, proven solution to many Americans’ retirement funding needs," he explained.
Effective from November 1st, the Department of Housing and Urban Development states that federally insured reverse mortgages have a single national loan limit of $417,000, Reuters reports.
A new poll reveals a shifting attitude about the role of big government in helping the U.S. out of the credit crunch.
The Bloomberg/Los Angeles Times survey, conducted on October 10-13, found that a larger number of people support the $700 billion bailout than oppose it.
This finding contrasts with the results of a similar poll conducted by Bloomberg/Times last month, which revealed that the majority of respondents were against the scheme.
Meanwhile, the majority of Americans seem to welcome some help from big government with their own financial problems.
The data indicates that a two-to-one proportion of respondents think the government should help homeowners who are facing foreclosure.
According to Bloomberg, some of this increased confidence in government action may be a result of positive activity in the stock market, which occurred just after details of the bailout were made public.
"They have to do something to spur the economy – otherwise, we’ll be further in the hole than we already were," independent voter Mike Hackenberg told the news agency.
The news comes after a recent survey by Reuters and the University of Michigan found that slightly more than half of Americans have lost confidence in the Federal Reserve in the past five years.
Just a few years ago, men and women on the cusp of retirement may have been feeling very good about their nest egg.
However, the economic turmoil of the past year has already done significant damage, according to reports. The Congressional Budget Office has estimated that retirement accounts lost a total of around $2 trillion over the past 15 months.
An article in U.S. News and World Report describes how baby boomers have been looking at different options for ensuring they have enough money to fund them throughout retirement.
Maurice Soto, a research associate at the Urban Institute, told the news provider that a potential retiree should make sure they have a portfolio that "reflects the time horizon and taste for risk" of their situation.
"The common advice is for households to reduce their exposure to stocks as they approach retirement," he explained.
Meanwhile, some workers who were hoping to get a different job after retirement or start a new business may want to think again in light of the effects of the credit crunch, the article suggested.
Richard Johnson of the Urban Institute said that new job opportunities – particularly part-time positions and flexible working – are likely to become scarce in the next few years.
Some studies have suggested that the chemical bisphenol A (BPA) could be linked to a number of different health problems, ranging from heart disease to cancer, even in low doses.
So why has the FDA not issued a stronger statement on its use to manufacture baby bottles? That is what the attorney generals from three states would like to know.
These individuals – from Connecticut, New Jersey and Delaware – wrote letters to 11 companies that that make containers used to feed babies, requesting that they discontinue their use of BPA.
Connecticut attorney general Richard Blumenthal said that the action was necessary because the FDA "has been asleep at the switch" regarding the regulation of BPA and is "resistant to respecting the scientific evidence" about the chemical’s risks.
Earlier this year, Laura Tarantino of the FDA said that "our tentative conclusion is that [BPA] is safe, so we’re not recommending any change in habits." Scientists estimate that more than 90 percent of Americans have trace amounts of BPA in their bodies.
The FDA has said it is preparing a new statement on the chemical that will be delivered later this month.
President Bush has described the government’s bailout plan – decried by some as meddling in the free market – as an "essential short-term measure" to free up credit and unfreeze the economy.
Some $250 billion of taxpayer money is set to be invested in some of the nation’s largest banks, in an effort to encourage lending and restore confidence in financial institutions.
In a speech, Bush said that the "limited and temporary" actions taken by the government were necessary to avoid a larger recession.
"These measures are not intended to take over the free market, but to preserve it," he explained.
Treasury secretary Henry Paulson also fleshed out further details of the government’s economic plan, including a scheme to guarantee new debt issued by banks for three years and an unlimited FDIC guarantee on bank deposits in non-interest accounts.
Banks that receive investment money will have to agree to limits on executive compensation during the period they are receiving funds, Paulson said.
A recent survey conducted by Reuters and the University of Michigan revealed that 29 percent of Americans said they have "a lot less" confidence in the Federal Reserve than they did five years ago.
New Hampshire hospitals that are guilty of serious errors may soon be required to report these missteps to the public, under a new law that is under consideration in the state.
The legislation centers on so-called "never events," which are defined by the National Quality Forum as medical care errors that are "clearly identifiable, preventable and serious in the consequences for patients – and that indicate a real problem in the safety and credibility of a healthcare facility," the Union Leader reports.
A 1999 study by the Institute of Medicine estimated that between 44,000 and 98,000 people die as a result of never events in U.S. hospitals each year.
However, New Hampshire is one of the states that does not keep track of such events, which the institute said may include problems such as adverse drug events, improper transfusions, surgical injuries and mistaken identities of patients – among others.
Lori Nerbonne of NH Patient Voices told the publication that it is in the public’s interest to know about hospital errors.
"We pay for this care, and as consumers, have a basic right to know if we or our family has been harmed or died as a result of it," she explained.
Privacy and civil liberty concerns have been raised about the way that the city of Santa Rosa, California manages the data it collects about residents.
More specifically, privacy advocates have been calling for stricter controls and clear policies to limit who can access information, the Press Democrat reports.
One of the initiatives that is under scrutiny is a scheme currently being carried out by city-hired contractors to photograph every street in the city.
The idea is to create a digital photo database of city-owned property so that future trips to the sites can be avoided, thus increasing efficiency.
However, Pam Dixon of the World Privacy Forum has said that Santa Rosa’s implementation of this plan has so far been "irresponsible."
"Information held by the government can be used to influence your world in very profound ways," she told the news provider.
In response, the city’s chief technology officer Eric McHenry said that his team had decided to cut back on the number of city employees who have access the street-level photos.
However, legal questions remain about how the information would be shared under California’s open access laws, the publication stated.
Republican presidential candidate John McCain may propose some tax cuts that could inject life into the listless economy, one of his advisors has suggested.
Senator Lindsey Graham told CBS program Face the Nation that McCain has been considering "a host of different courses of action" aimed at freeing up credit for the country’s financial health.
"Now is the time to lower tax rates for investors – capital gains tax, dividend tax rates – to make sure that we can get the economy jump-started," he told the program.
Over the past several weeks, politicians and policymakers have been debating the best method for restarting economic growth in America.
The government has already taken a variety of steps to calm the public’s fears, including the announcement of a $700 billion bailout for banks, but few signs of recovery have been noted.
Graham told Face the Nation that November’s vote may determine the path the country takes in the next four years.
"Senator Obama, who’s masquerading as a centrist, is anything but a centrist when it comes to taxing, spending and social policy," he explained.
On Monday, McCain delivered a stump speech in Virginia during which he attempted to differentiate his economic policies from those of the past eight years and called the country to "change direction."
It seems that the current credit crisis has eroded many Americans’ confidence in financial institutions and the government’s ability to set monetary policy.
A new poll conducted by Reuters and the University of Michigan found that more than half of U.S. consumers say they have less confidence in the Federal Reserve than they did five years ago.
And 29 percent of respondents reported having "a lot less" confidence in the Fed.
Survey director Richard Curtin said that these findings could indicate that "a longer and deeper recession" is on the horizon.
"This loss in confidence will cause consumers to accelerate their spending cutbacks and those reductions are likely to persist through most of 2009," he wrote in the report.
In contrast, following the 1987 stock market crash, less than one in five consumers (19 percent) said they had less confidence in the Fed, with seven percent reporting a lot less confidence.
On Friday, President Bush made a statement about the government’s efforts to combat a more serious economic downturn, saying that it was instigating an "aggressive" plan to restore equilibrium. He also urged Americans to have confidence in the government’s ability to solve the problem.
The National Security Administration is currently under investigation for charges that it listened in on personal phone calls made by military personnel and other Americans living overseas, it has emerged.
Two former employees of the NSA say that staff monitored and shared access to these communications, even though the callers were not suspected of terrorist activities.
In fact, former U.S. Navy Arab linguist David Murfee Faulk told ABC News that staff often listened to intimate conversations between military officers and their spouses or partners in the U.S., sharing the contents of some of the racier calls with colleagues.
Senate intelligence committee chairman John D. Rockefeller IV, who is investigating the allegations, said that the accusations were "extremely disturbing."
"Any time there is an allegation regarding abuse of the privacy and civil liberties of Americans, it is a very serious matter," he explained.
In September 2007, the New York Times reported that the NSA said that it had stopped the practice of using wiretaps on Americans’ phones without first obtaining a warrant – a measure that had been introduced shortly after the September 11, 2001 terrorist attacks.
It seems that each day brings new headlines about financial turmoil and a tumultuous stock market, with the result that the average investor may be uncertain about how to protect their wealth.
According to a report in the Wall Street Journal, some financial advisors are attempting to keep their clients’ money safe by increasing their cash holdings and exposure to cash and cash-equivalent investments.
Pran Tiku, a wealth manager for Peak Financial Management, told the news provider that he has been selling off lower-quality bonds with a higher yield in order to raise cash.
"If the credit crunch is as ominous as it seems and does not have a resolution, then cash becomes a very important investment to hold," he said.
In a more even-keeled market, Tiku said that he holds at least five percent of someone’s portfolio in cash and cash-equivalent short-term investments.
However, the current climate has prompted him to raise this proportion to 30 percent, while decreasing the amount held in bonds from 30 to seven percent.
Last week, Fortune magazine writer Eugenia Levinson suggested that people consider purchasing tax-exempt money market funds, which currently offer an unusually high average yield.
When a child’s health is at stake, parents may expect complete candor from doctors and pediatricians – but in reality, is this always the case?
A new study published in the Archives of Pediatrics & Adolescent Medicine reveals that children’s doctors differ in their approach to disclosing a medical error.
Researchers led by Dr. David J. Loren of the University of Washington School of Medicine polled more than 200 pediatricians about their responses to scenarios in which a child was hospitalized due to an error on their part.
In one of the examples, parents were more likely to be aware of the mistake, while in the other it was more easily concealed.
The survey results revealed a tendency to be more likely to acknowledge an error when it would already be obvious to the family involved.
"This study demonstrated marked variation in when and how pediatricians might disclose medical errors and found that they may be less likely to disclose an error that was less apparent to the family," the researchers wrote.
According to the Agency for Healthcare Research and Quality, medication errors result in around 770,000 injuries and deaths each year in the U.S.
U.S. government agencies should be obligated to assess the impact of counterterrorism initiatives on people’s privacy before they begin, a new report claims.
The National Research Council looked at the methodology, effectiveness and privacy implications of a variety of surveillance techniques used by the government.
In the report, the council noted that data on members of the public is regularly recorded in a number of ways – for example, through telephone calls, credit card usage and taxes – and that the government has access to a great deal of this information.
Former U.S. secretary of defense William Perry, co-chair of the committee that wrote the report, said that although technology should be used to prevent potential terrorist attacks, there should be a structure in place to protect privacy.
"The threat [of terrorism] does not justify government activities that violate the law, or fundamental changes in the level of privacy protection to which Americans are entitled," he commented.
In addition to preliminary evaluation of privacy concerns, a framework for regular oversight should be established, the report said.
The National Research Council has a mission to inform and improve the policies and actions of the U.S. government, according to its website.
Steve Forbes, publisher and editor-in-chief of Forbes magazine, has spoken out against policies that raise taxes in times of financial crisis, claiming that they stifle the economy.
"It was the Roosevelt-Hoover policies that were a disaster in the 30s [and] inflationary, pro-tax policies in the 70s, that turned that decade into a decade of stagnation – and Reagan reversed it," he told CNBC, according to Newsmax.
Forbes has been constantly vocal about the need for tax reform, particularly during his two bids for the presidency in 1996 and 2000.
He has suggested that the U.S. government dispose of the current tax code completely and replace it with a flat tax of 17 percent. He also opposes taxes on social security, pensions, personal savings and capital gains.
In the CNBC interview, Forbes also called for an end to market-to-market accounting rules, which he blamed for the downfall of firms such as AIG and Lehman Brothers.
"This thing is now 14 months old, when it should have been 14 weeks," he added, referring to the credit crisis.
A lawsuit has been filed against pharmaceutical firm Pfizer, alleging that the company attempted to suppress negative research about its epilepsy drug, Neurontin.
Documents submitted by the plaintiffs allege that the drug company delayed publication of certain studies regarding the medication’s success for conditions other than epilepsy.
They also claim that Pfizer used spin techniques to make results seem more positive and combined both favorable and negative findings together, which distorted research.
The pharmaceutical giant has denied it is at fault, releasing a statement saying it is "committed to the communication of medically or scientifically significant results of all studies, regardless of outcome."
According to the New York Times, some of the studies in question raised doubts about how effectively Neurontin was at treating bipolar disorder, some types of pain and migraines.
In 2004, the drug company paid hundreds of millions of dollars to settle a lawsuit claiming Neurontin was promoted to treat unapproved conditions by Warner-Lambert, a firm which was purchased by Pfizer in 2000.
Pfizer stopped marketing Neurontin in 2004, when it lost its patent protection. The company’s 2007 revenue was $48.4 billion.
The credit crunch has sent Americans of all ages scrambling to reassess their personal economic situation – including baby boomers who may have assumed they were on the cusp of enjoying their golden years in relative wealth.
Around one-third of middle-aged workers have considered putting off their retirement due to financial concerns, according to research from AARP.
The survey findings, reported in the Wall Street Journal, also reveal that 20 percent have stopped contributing to their retirement plans during the past year.
More than a quarter of respondents said they were struggling to pay rent or their mortgage, while 13 percent admitted they had prematurely withdrawn funds from their retirement savings, despite the fact that this decision carries a tax penalty.
Commenting on the findings, Jean Setzfand of the AARP said that many people have been sacrificing longer-term financial goals to cover more pressing "basic expenses like food, gas and utilities."
"People are trying to get through the day, and worry about the future later," she explained, according to the news provider.
There are around 78 million baby boomers in the U.S., according to census statistics.
President Franklin D. Roosevelt’s "misguided policies" led to the Great Depression lasting far longer than it should have, according to two UCLA economists.
Harold L. Cole and Lee E. Ohanian analyzed the economic recovery of the U.S. following the depression and concluded that New Deal measures interfered with the market’s ability to self-correct, Newsmax reports.
Roosevelt was wrong to blame "excessive competition" for economic problems, Cole explained. He said that this mistake led to the president allowing workers to demand inflated wages and businesses to collude to inflate prices.
"The economy was poised for a beautiful recovery, but that recovery was stalled by these misguided policies," Cole told the news provider.
He suggested that a central assumption many economists have held since the end of the Great Depression – that government intervention is necessary to heal wounds created by capitalism run amok – is thrown into question by this research.
A recent CNN Money poll revealed that 60 percent of Americans believe the current credit crunch will lead to an economic depression.
Some people are not convinced that new guidelines introduced by the FBI in the final weeks of the Bush administration will adequately protect American’s civil liberties.
The standards set out what agents can and cannot do when starting an investigation, including rules about conducting surveillance, utilizing informants and including race or ethnicity as a factor for suspicion.
"These guidelines support the FBI’s mission, emphasizing early detection, prevention and interagency cooperation," an FBI press release stated. The new rules consolidate and replace five previous sets of guidelines for issues such as criminal investigations and foreign intelligence.
According to the American Civil Liberties Union, the new guidelines are overly broad and leave too much room for abuse by authorities.
"The FBI has shown time and time again that it is incapable of policing itself and there is good reason to believe that these guidelines will lead to more abuse," ACLU executive director Anthony D. Romero said in a statement.
And some lawmakers raised concerns about the FBI’s ability to access the private information of average citizens as part of an investigation.
The government now has the green light to begin a limited version of a satellite surveillance program that provides imagery of the U.S. to federal, state and local authorities.
Known as the National Applications Office, the initiative is aimed at helping officials with emergency response and domestic security, according to a report in the Wall Street Journal.
However, some have raised concerns about the civil liberties and privacy issues at stake.
For example, an unpublished Government Accountability Office report suggested that the Department of Homeland Security has not provided adequate assurance that it will be able to oversee procedures and prevent information from being misused.
In response to these concerns, Congress placed some temporary funding restrictions on the program, but an initial phase has already begun.
California representative Jane Harman told the publication that she will fight the expansion of the scheme, having taken on board lessons learned from previous government surveillance initiatives.
"I don’t want to go there again until the legal framework for the entire program is entirely spelled out," she said.
In other civil liberties news, lawmakers recently proposed legislation to limit how border officials monitor and copy electronic and paper documents carried by travelers.
Congress’ approval of a $700 billion rescue package for financial institutions will not prevent more banks from failing in the coming year, analysts have suggested.
An Associated Press report suggests that the coming months could bring the most uncertainty that banks have seen since the savings and loan crisis of the 1990s.
Stanford Financial analyst Jeret Seiberg told the news agency that many banks are carrying construction loans and other deteriorating assets that will not be relieved by the bailout.
In addition, the AP points out that banks have grown larger in the past couple of decades, which could mean that even if fewer banks fail, the financial consequences could be just as great.
Joseph Mason, an economist who teaches at Louisiana State University, said that lenders are set to pay for their risky behavior.
"We just had a big party where people and businesses overborrowed," he commented. "We had a bubble and now we want to get back to normal. Is it going to be painless? No."
Last month, Washington Mutual was seized by the FDIC in what has been described as the largest bank failure in U.S. history. It seems that more casualties could be on the way.
Despite a health scare in which tens of thousands of Chinese babies have fallen ill due to melamine in their formula, the Food and Drug Administration has said that products containing small amounts of the chemical are not dangerous for adults.
The FDA explained that its safety experts believe that people who consume a very low amount of melamine, calculated as 2.5 parts per million, would not suffer health problems.
However, the agency concluded that no amount of the chemical could be considered safe in infant formula, because there is not enough information on how children are affected by exposure.
According to the FDA, its safety assessment is aimed at situations in which melamine is accidentally incorporated into food, rather than deliberate attempts to add it.
"If products are adulterated because they contain melamine, (authorities) will take appropriate actions to prevent the products from entering commerce," the agency stated.
In September, a worldwide health alert broke out after it emerged that Chinese children were getting sick from melamine that had been deliberately added to dairy products to boost protein levels.
We expect hospitals to use disinfectants and other cleaning products to kill germs and protect us, but new researchers suggest this practice – if administered incorrectly – could have dangerous consequences.
Published in the journal Microbiology, the study looked at biocides, chemicals that are used by hospitals to sterilize equipment and clean surfaces.
It found that if used at optimum levels, biocides can effectively destroy bacteria. However, if the dosages used for cleaning are too low, the microbes can survive and grow even stronger.
According to the research, conducted at the Department of Veterans Affairs Medical Center, bacteria have protein pumps that eliminate various toxic substances, such as antibiotics, making them resistant to drugs.
When weak biocides allow some bugs to survive, the number of these protein pumps increased.
"We found that exposure to low concentrations of a variety of biocides and dyes resulted in the appearance of resistant mutants," explained study leader Dr. Glenn Kaatz.
MRSA is one notorious "superbug" that has become resistant to antibiotics. This type of infection may result in serious illness and even death.
Those who are seriously ill may want to think twice about entering a hospital in the southern U.S., following the results of a new study.
Palliative care is a holistic approach to advanced progressive illness that focuses on managing symptoms and providing support as part of an effort to improve quality of life.
Patients suffering from chronic diseases such as heart disease, liver and kidney failure and Alzheimer’s may benefit from this type of healthcare.
The National Palliative Care Research Center and the Center to Advance Palliative Care evaluated the access to these types of services at hospitals across the U.S.
As a whole, the nation’s access was graded a C, with three southern states – Oklahoma, Alabama and Mississippi – receiving an F.
In contrast, only three states received the top grade: Vermont, Montana and New Hampshire.
Around 41 percent of southern hospitals offered palliative care, compared with 53 percent across the country as a whole.
"Without palliative care, people with serious illnesses like cancer often suffer unnecessarily from severe fatigue, pain, shortness of breath, nausea and other symptoms," commented co-author of the report Dr. Diane E. Meier.