Saturday, September 6, 2008

Stopping the Economic Bloodsuckers

Stopping The Economic Bloodsuckers

Go ahead and hate your neighbor,
Go ahead and cheat a friend.

-Coven (theme from the movie Billy Jack)

Last week, I received a direct mail piece telling me how I could make “big dollars” screwing over my neighbors. The writers want to show me how to “take advantage” of hard economic times.

Apparently, there are “great opportunities” sticking it to people who are hurting. The more they hurt, the more you can stick it to them.

Business must be great right now.

The writers said those down on their luck were “business prospects.” For a fee, the authors can show me how to push them further down the economic ladder and make a few bucks myself.

I think I’ll pass.

My temptation is to re-print the letter. I won’t. How do I separate the authors from an economy filled with payday lenders, companies that buy structured settlements and a host of other “great opportunities” for people to stick it to their neighbors?

The letter is a symptom of a larger economic problem. We have made economic exploitation fashionable and profitable.

There may have been a time when companies and people worried about their reputations. That time is long gone.

Many huge, supposedly respectable, companies back payday lenders, offer high interest credit cards and hire abusive collectors.

Read the back pages of the Wall Street Journal and you will see big name companies getting rapped on the knuckles for doing stuff they know is wrong. They do it anyway.

I never see a company’s stock price fall after those disclosures. There is no shame in getting caught.

I don’t know how to change the nation’s culture to rise up against exploitation. It would require a change in attitude and focus.

I am not crying out for more government regulation. We have a ton of “consumer protection” agencies supposedly in place. I can’t figure-out what some of them do. We have set up a system of toothless watchdogs.

Adding more bureaucrats won’t solve problems. I’m not that impressed by the current crew.

The most worthless is the Federal Trade Commission. It sounds like an impressive place, with an impressive title, that is supposed to enforce laws against collectors and credit card companies.

Drop the Federal Trade Commission a letter sometime. See what happens. You will get a form letter back saying that they are going to look at the problem. They won’t.

I guess the FTC doesn’t think there are any abusive collectors out there.

Listen to Dave Ramsey’s radio show. You will hear caller after caller tell horror stories about abusive collectors. Many collectors don’t bother to follow the law. They know they will never get caught.

I never hear Dave telling callers to write the FTC. He knows it is a waste of time.

Thus, collections have become a great “business opportunity”. The harder times get, the more opportunities there are.

I want to create another “business opportunity”. A bounty system against exploiters.

You don’t see a lot of poor people suing exploiters. First of all, the people being exploited are poor. Groceries and gas money get in front of legal fees.

The laws are written to favor the exploiters. If you take an abusive collector or credit card company to court, you don’t get much in return.

Few lawyers take the creditor cases and few people bother to protect their rights. It is as futile as writing the FTC.

If a person got an automatic $100,000 every time they could prove a collector violated the law, you would have lots of whistle blowers interested in turning them in.

When they are losing $100,000 a pop, the wrong-doer population would reform or be quickly gone.

My solution wouldn’t require any new government agencies or tax dollars. Just tweak the laws and allow the legal system to take advantage of the “big opportunity.”

If a person is intent on cheating their neighbors, they would find their neighbor had a “big dollar, business opportunity” in getting them to do the right thing,

It would be alternative way to take advantage of hard times.

Don McNay is Chairman of the Board for McNay Settlement Group. You can write to him at or read his award winning column at McNay is Treasurer of the National Society of Newspaper Columnists.

Wednesday, September 3, 2008

Al Smith winning SPJ award

Tom Eblen at the Lexington Herald Leader did a terrific column this week about Al Smith. Al, along with Tim Russert and two others, will receive a huge award from the Society of Professional Journalists at their Atlanta convention this week.

I planned to be there before I banged up my knee. I am better now. I went to Dr. Phil Hoffman yesterday, who is best known as the father of "Babydaddy" in the Scissor Sisters. Dr. Phil had me jump around the office for a few minutes. He could have been auditioning me as a dancer for the group. Never know. I feel pretty good but it is too late to reschedule my trip.

I had dinner with Al & Martha Helen last week. They also invited Elizabeth Page, and her parents. Elizabeth is a fascinating MIT student from Lexington who I plan to feature in a future column. Elizabeth gives me hope for the future of America and the kind of talented student that Kentucky schools can produce.

Tom Eblen Column about Al Smith

Don McNay Column: Al Smith & War Against Addiction

Sunday, August 31, 2008

Business Books To Learn From

Business Books To Learn From

And feed them on your dreams
The one they pick
The one you'll know by.

-Crosby, Stills, Nash and Young

Charles Martin, entrepreneur and owner of Apollo’s Pizza in Richmond, has been quizzing me in his search for books about business and investments.

He made me aware that the average person doesn’t have a “ business reading list” they can get their hands on.

Many bookstores gear the business section to books promising quick riches or books by celebrities. You see a lot of easy money schemes sitting next to by Donald Trump.

If you ask 1000 business leaders about books that influenced their lives, none ever mention Donald Trump.

For my next column, I’m going to ask some great business leaders about the books that influence and inspire them.

This week, you're going to have to rely on me.

Top on my list is The Millionaire Next Door by Dr. Thomas Stanley. It’s easy to read and gives common sense advice. All of Stanley’s books, especially his early academic work, are good picks. Millionaire is an excellent read for small business owners like Charles.

Stanley’s research showed that people who own businesses are most likely to be millionaires.

The best way to learn is to watch somebody who’s doing it well. Since Warren Buffett is the richest man in the world, you can't go wrong by watching him.

There are over 60 books written about Buffett, with another highly anticipated biography being released later this month. I’ve read most of the Buffett biographies and the best is Buffett: Making of an American Capitalist by Roger Lowenstein.

My favorite personal finance books have been around for a long time. No matter how hard people try, there's are not new things to say about personal finance.

Thousands of personal finance books come to the same conclusion: spend less than you make, follow a budget, and invest for long periods of time.

It doesn’t get more complicated than that.

Three books I like are: The Challenges of Wealth by Amy Domini, Financial Peace by Dave Ramsey and The Only Investment Guide You Will Ever Need by Andrew Tobias.

I like Amy because she has a lot of deep research. I like Dave because he hates credit cards and learned from the school of hard knocks. I like Andy because he is insightful and funny.

Andy once said that I was insightful and funny. I want to return the favor. He the only finance writer I know of that makes you laugh out loud.

All the books are easy to read. None give you any magic bullets or get rich quick schemes.

If you feel like you have mastered the basics, it’s time to move up to Benjamin Graham. Dr. Graham is the academic who influenced on Warren Buffett and countless other investors.

Graham’ stuff is complex, but well worth the time. The classic Graham book is Security Analysis, and his best known book is The Intelligent Investor.
Another oldie but goodie is A Random Walk Down Wall Street. I would also grudgingly admit that Peter Lynch’s One Up On Wall Street has value.
I’ve written at 20 columns bashing Lynch but he wrote his book before his company started peddling crummy mutual funds to soldiers fighting in Iraq.
One of the reasons I remain mad at Lynch is that, from his book, I knew he knew better.
In business, like anything else, people need to know about history. I reviewed Joe Nocera’s, A Piece of the Action for the Lexington Herald in 1994 and said it was one of the greatest business books ever written. Nothing has caused me to change my mind.
A Piece of Action gives Joe’s perspective on the history of personal finance in America on how it enabled the average consumer.
People often fall off their investment plans or have their businesses fail because they don’t have a long term vision or goal.
The classic book on vision is The Magic of Thinking Big by Dr. David Schwartz. I re-read it every year.
I also like Mastering the Game, an obscure book by Dr. Kerry Johnson. Lately, I’ve been reading The Four Hour Work Week by Timothy Ferriss. I expected to hate the book but it has some great insights into using technology and outsourcing to balance life.
Don McNay is Chairman of the Board for McNay Settlement Group in Richmond. You can read his award winning column at or write to him at