In the United States an annuity contract is created when an insured party, usually an individual, pays a life insurance company a single premium that will later be distributed back to the insured party over time. Annuity contracts traditionally provide a guaranteed distribution of income over time, until the death of the person or persons named in the contract or until a final date, whichever comes first. However, the majority of modern annuity customers use annuities only to accumulate funds free of income and capital gains taxes and to later take lump-sum withdrawals without using the guaranteed-income-for-life feature.

Annuity contracts in the United States are defined by the Internal Revenue Code and regulated by the individual states. Variable annuities have features of both life insurance and investment products. In the U.S., annuity insurance may be issued only by life insurance companies, although private annuity contracts may be arranged between donors to non-profits to reduce taxes. Insurance companies are regulated by the states, so contracts or options that may be available in some states may not be available in others. Their federal tax treatment, however, is governed by the Internal Revenue Code. Variable annuities are regulated by the Securities and Exchange Commission and the sale of variable annuities is overseen by the Financial Industry Regulatory Authority (FINRA) (the largest non-governmental regulator for all securities firms doing business in the United States).
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There are two possible phases for an annuity, one phase in which the customer deposits and accumulates money into an account (the deferral phase), and another phase in which customers receive payments for some period of time (the annuity or income phase). During this latter phase, the insurance company makes income payments that may be set for a stated period of time, such as five years, or continue until the death of the customer(s) (the “annuitant(s)”) named in the contract. Annuitization over a lifetime can have a death benefit guarantee over a certain period of time, such as ten years. Annuity contracts with a deferral phase always have an annuity phase and are called deferred annuities. An annuity contract may also be structured so that it has only the annuity phase; such a contract is called an immediate annuity. Note this is not always the case.

Immediate annuity

The term “annuity,” as used in financial theory, is most closely related to what is today called an immediate annuity. This is an insurance policy which, in exchange for a sum of money, guarantees that the issuer will make a series of payments. These payments may be either level or increasing periodic payments for a fixed term of years or until the ending of a life or two lives, or even whichever is longer. It is also possible to structure the payments under an immediate annuity so that they vary with the performance of a specified set of investments, usually bond and equity mutual funds. Such a contract is called a variable immediate annuity. See also life annuity, below.

The overarching characteristic of the immediate annuity is that it is a vehicle for distributing savings with a tax-deferred growth factor. A common use for an immediate annuity might be to provide a pension income. In the U.S., the tax treatment of a non-qualified immediate annuity is that every payment is a combination of a return of principal (which part is not taxed) and income (which is taxed at ordinary income rates, not capital gain rates). Immediate annuities funded as an IRA do not have any tax advantages, but typically the distribution satisfies the IRS RMD requirement and may satisfy the RMD requirement for other IRA accounts of the owner (see IRS Sec 1.401(a)(9)-6.)

When a deferred annuity is annuitized, it works like an immediate annuity from that point on, but with a lower cost basis and thus more of the payment is taxed.

Annuity with period certain

This type of immediate annuity pays the annuitant for a designated number of years (i.e., a period certain) and is used to fund a need that will end when the period is up (for example, it might be used to fund the premiums for a term life insurance policy). Thus this option is not necessarily suitable for an individual’s retirement income, as the person may outlive the number of years the annuity will pay.

Life annuity

A life or lifetime immediate annuity is used to provide an income for the life of the annuitant similar to a defined benefit or pension plan.

A life annuity works somewhat like a loan that is made by the purchaser (contract owner) to the issuing (insurance) company, which pays back the original capital or principal (which isn’t taxed) with interest and/or gains (which is taxed as ordinary income) to the annuitant on whose life the annuity is based. The assumed period of the loan is based on the life expectancy of the annuitant. In order to guarantee that the income continues for life, the insurance company relies on a concept called cross-subsidy or the “law of large numbers”. Because an annuity population can be expected to have a distribution of lifespans around the population’s mean (average) age, those dying earlier will give up income to support those living longer whose money would otherwise run out. Thus it is a form of longevity insurance.

A life annuity, ideally, can reduce the “problem” faced by a person that he/she doesn’t know how long he/she will live, and so he/she doesn’t know the optimal speed at which to spend his/her savings. Life annuities with payments indexed to the Consumer Price Index might be an acceptable solution to this problem, but there is only a thin market for them in North America.

Life annuity variants

For an additional expense (either by way of an increase in payments (premium) or a decrease in benefits), an annuity or benefit rider can be purchased on another life such as a spouse, family member or friend for the duration of whose life the annuity is wholly or partly guaranteed. For example, it is common to buy an annuity which will continue to pay out to the spouse of the annuitant after death, for so long as the spouse survives. The annuity paid to the spouse is called a reversionary annuity or survivorship annuity. However, if the annuitant is in good health, it may be more advantageous to select the higher payout option on his or her life only and purchase a life insurance policy that would pay income to the survivor.

The pure life annuity can have harsh consequences for the annuitant who dies before recovering his or her investment in the contract. Such a situation, called a forfeiture, can be mitigated by the addition of a period-certain feature under which the annuity issuer is required to make annuity payments for at least a certain number of years; if the annuitant outlives the specified period certain, annuity payments continue until the annuitant’s death, and if the annuitant dies before the expiration of the period certain, the annuitant’s estate or beneficiary is entitled to the remaining payments certain. The tradeoff between the pure life annuity and the life-with-period-certain annuity is that the annuity payment for the latter is smaller. A viable alternative to the life-with-period-certain annuity is to purchase a single-premium life policy that would cover the lost premium in the annuity.

Impaired-life annuities for smokers or those with a particular illness are also available from some insurance companies. Since the life expectancy is reduced, the annual payment to the purchaser is raised.

Life annuities are priced based on the probability of the annuitant surviving to receive the payments. Longevity insurance is a form of annuity that defers commencement of the payments until very late in life. A common longevity contract would be purchased at or before retirement but would not commence payments until 20 years after retirement. If the nominee dies before payments commence there is no payable benefit. This drastically reduces the cost of the annuity while still providing protection against outliving one’s resources.

Deferred annuity

The second usage for the term annuity came into being during the 1970s. Such a contract is more properly referred to as a deferred annuity and is chiefly a vehicle for accumulating savings with a view to eventually distributing them either in the manner of an immediate annuity or as a lump-sum payment.

All varieties of deferred annuities owned by individuals have one thing in common: any increase in account values is not taxed until those gains are withdrawn. This is also known as tax-deferred growth.

A deferred annuity which grows by interest rate earnings alone is called a fixed deferred annuity (FA). A deferred annuity that permits allocations to stock or bond funds and for which the account value is not guaranteed to stay above the initial amount invested is called a variable annuity (VA).

A new category of deferred annuity, called the fixed indexed annuity (FIA) emerged in 1995 (originally called an Equity-Indexed Annuity). Fixed indexed annuities may have features of both fixed and variable deferred annuities. The insurance company typically guarantees a minimum return for EIA. An investor can still lose money if he or she cancels (or surrenders) the policy early, before a “break even” period. An oversimplified expression of a typical EIA’s rate of return might be that it is equal to a stated “participation rate” multiplied by a target stock market index’s performance excluding dividends. Interest rate caps or an administrative fee may be applicable.

Deferred annuities in the United States have the advantage that taxation of all capital gains and ordinary income is deferred until withdrawn. In theory, such tax-deferred compounding allows more money to be put to work while the savings are accumulating, leading to higher returns. A disadvantage, however, is that when amounts held under a deferred annuity are withdrawn or inherited, the interest/gains are immediately taxed as ordinary income.

Features

A variety of features and guarantees have been developed by insurance companies in order to make annuity products more attractive. These include death and living benefit options, extra credit options, account guarantees, spousal continuation benefits, reduced contingent deferred sales charges (or surrender charges), and various combinations thereof. Each feature or benefit added to a contract will typically be accompanied by an additional expense either directly (billed to client) or indirectly (inside product).

Deferred annuities are usually divided into two different kinds:

Fixed annuities offer some sort of guaranteed rate of return over the life of the contract. In general such contracts are often positioned to be somewhat like bank CDs and offer a rate of return competitive with those of CDs of similar time frames. Many fixed annuities, however, do not have a fixed rate of return over the life of the contract, offering instead a guaranteed minimum rate and a first year introductory rate. The rate after the first year is often an amount that may be set at the insurance company’s discretion subject, however, to the minimum amount (typically 3%). There are usually some provisions in the contract to allow a percentage of the interest and/or principal to be withdrawn early and without penalty (usually the interest earned in a 12-month period or 10%), unlike most CDs. Fixed annuities normally become fully liquid depending on the surrender schedule or upon the owner’s death. Most equity index annuities are properly categorized as fixed annuities and their performance is typically tied to a stock market index (usually the S&P 500 or the Dow Jones Industrial Average). These products are guaranteed but are not as easy to understand as standard fixed annuities as there are usually caps, spreads, margins, and crediting methods that can reduce returns. These products also don’t pay any of the participating market indices’ dividends; the trade-off is that contract holder can never earn less than 0% in a negative year.

Variable annuities allow money to be invested in insurance company “separate accounts” (which are sometimes referred to as “subaccounts” and in any case are functionally similar to mutual funds) in a tax-deferred manner. Their primary use is to allow an investor to engage in tax-deferred investing for retirement in amounts greater than permitted by individual retirement or 401(k) plans. In addition, many variable annuity contracts offer a guaranteed minimum rate of return (either for a future withdrawal and/or in the case of the owner’s death), even if the underlying separate account investments perform poorly. This can be attractive to people uncomfortable investing in the equity markets without the guarantees. Of course, an investor will pay for each benefit provided by a variable annuity, since insurance companies must charge a premium to cover the insurance guarantees of such benefits. Variable annuities are regulated both by the individual states (as insurance products) and by the Securities and Exchange Commission (as securities under the federal securities laws). The SEC requires that all of the charges under variable annuities be described in great detail in the prospectus that is offered to each variable annuity customer. Of course, potential customers should review these charges carefully, just as one would in purchasing mutual fund shares. People who sell variable annuities are usually regulated by FINRA, whose rules of conduct require a careful analysis of the suitability of variable annuities (and other securities products) to those to whom they recommend such products. These products are often criticized as being sold to the wrong persons, who could have done better investing in a more suitable alternative, since the commissions paid under this product are often high relative to other investment products.

There are several types of performance guarantees, and one may often choose them à la carte, with higher risk charges for guarantees that are riskier for the insurance companies. The first type is a guaranteed minimum death benefit (GMDB), which can be received only if the owner of the annuity contract, or the covered annuitant, dies.

GMDBs come in various flavors, in order of increasing risk to the insurance company:

Return of premium (a guarantee that you will not have a negative return)
Roll-up of premium at a particular rate (a guarantee that you will achieve a minimum rate of return, greater than 0)
Maximum anniversary value (looks back at account value on the anniversaries, and guarantees you will get at least as much as the highest values upon death)
Greater of maximum anniversary value or particular roll-up

Insurance companies provide even greater insurance coverage on guaranteed living benefits, which tend to be elective. Unlike death benefits, which the contractholder generally can’t time, living benefits pose significant risk for insurance companies as contractholders will likely exercise these benefits when they are worth the most. Annuities with guaranteed living benefits (GLBs) tend to have high fees commensurate with the additional risks underwritten by the issuing insurer.

Some GLB examples, in no particular order:

Guaranteed minimum income benefit (GMIB, a guarantee that one will get a minimum income stream upon annuitization at a particular point in the future)
Guaranteed minimum accumulation benefit (GMAB, a guarantee that the account value will be at a certain amount at a certain point in the future)
Guaranteed minimum withdrawal benefit (GMWB, a guarantee similar to the income benefit, but one that doesn’t require annuitizing)
Guaranteed-for-life income benefit (a guarantee similar to a withdrawal benefit, where withdrawals begin and continue until cash value becomes zero, withdrawals stop when cash value is zero and then annuitization occurs on the guaranteed benefit amount for a payment amount that is not determined until annuitization date.)

Recently, insurance companies developed asset-transfer programs that operate at the contract level or the fund level. In the former, a percentage of client’s account value will be transferred to a designated low-risk fund when the contract has poor investment performance. On the fund level, certain investment options have a target volatility built within the fund (usually about 10%) and will re-balance to maintain that target. In both cases, they are stated to help buffer poor investment performance until markets perform better (where they will transition back to normal allocations to catch an upswing). However, there are criticisms of these programs including, but not limited to, often mandating these programs on clients, restricting flexibility of investing, and not catching the upswing of markets fast enough due to the underlying design of such programs.

Be careful in regard to using GLB riders in non-qualified contracts as most of the products in the annuity marketplace today create a 100% taxable income benefit whereas income generated from an immediate annuity in a non-qualified contract would partially be a return of principal and therefore non-taxable.

Criticisms of deferred annuities

Deferred annuities are generally sold by financial professionals, some of whom may work directly for an insurance company. Most financial professionals, however, are independent agents of the insurance company, not employees. The financial professional who sells an annuity collects a commission from the insurance company. This commission will be a percentage of the total premium paid by the investor. This percentage can be as little as 1% and as high as 12%; the average is 6%. Since these commissions appear high and there are deferred sales charges on annuities, many financial gurus have criticized annuity products.

The investor will, generally, not pay any of this commission directly to the financial professional; the commission is paid by the insurance company to the financial professional up front. The insurance company will recapture the commission paid to the financial professional through the fees charged to the customer (in a variable or fixed indexed annuity) or the spread in the interest rate market (for a fixed annuity). There are also deferred back-end charges that will be applied if the investor closes out his or her contract before the agreed-upon time frame, usually 8 years. These charges can last for as little as 1 year or as many as 20 years, depending on the type of annuity and issuing company. These back-end charges concern many financial professionals and financial gurus.

Some annuities do not have any deferred surrender charges and do not pay the financial professional a commission, although the financial professional may charge a fee for his or her advice. These contracts are called “no-load” variable annuity products and are usually available from a fee-based financial planner or directly from a no-load mutual fund company. Of course various charges are still imposed on these contracts, but they are less than those sold by commissioned brokers. It is important that potential purchasers—of annuities, mutual funds, tax-exempt municipal bonds, commodities futures, interest rate swaps, in short, any financial instrument—understand the fees on the product and the fees a financial planner may charge.

Variable annuities are controversial because many believe the extra fees (i.e., the fees above and beyond those charged for similar retail mutual funds that offer no principal protection or guarantees of any kind) may reduce the rate of return compared to what the investor could make by investing directly in similar investments outside of the variable annuity. A big selling point for variable annuities is the guarantees many have, such as the guarantee that the customer will not lose his or her principal. Critics say that these guarantees are not necessary because over the long term the market has always been positive, while others say that with the uncertainty of the financial markets many investors simply will not invest without guarantees. Past returns are no guarantee of future performance, of course, and different investors have different risk tolerances, different investment horizons, different family situations, and so on. The sale of any security product should involve a careful analysis of the suitability of the product for a given individual.

A controversial practice of insurance sales is the selling of insurance contracts within an IRA or 401(k) plan. Since these investment vehicles are already tax deferred, investors do not receive additional tax shelters from the annuities. The benefit of the annuity contract is the guaranteed lifetime income that all annuity contracts must have by state law. Approximately 90% of annuitants, however, have not taken the life annuity upon retirement. If an investor does not intend to take the life income option from an annuity contract at retirement he or she may want to consider a low-cost deferred annuity.

If an investor needs to take lifetime income at retirement, on the other hand, he or she may want to try to buy an annuity upon retirement or might consider selecting a 401(k) plan account with an option to buy the annuity just before retirement.

Taxation

In the U.S. Internal Revenue Code, the growth of the annuity value during the accumulation phase is tax-deferred, that is, not subject to current income tax, for annuities owned by individuals. The tax deferred status of deferred annuities has led to their common usage in the United States. Under the U.S. tax code, the benefits from annuity contracts do not always have to be taken in the form of a fixed stream of payments (annuitization), and many of annuity contracts are bought primarily for the tax benefits rather than to receive a fixed stream of income. If an annuity is used in a qualified pension plan or an IRA funding vehicle, then 100% of the annuity payment is taxable as current income upon distribution (because the taxpayer has no tax basis in any of the money in the annuity). If the annuity contract is purchased with after-tax dollars, then the contract holder upon annuitization recovers his basis pro-rata in the ratio of basis divided by the expected value, according to the tax regulation Section 1.72-5. (This is commonly referred to as the exclusion ratio.) After the taxpayer has recovered all of his basis, then 100% of the payments thereafter are subject to ordinary income tax.

Since the Jobs and Growth Tax Relief Reconciliation Act of 2003, the use of variable annuities as a tax shelter has greatly diminished, because the growth of mutual funds and now most of the dividends of the fund are taxed at long term capital gains rates. This taxation, contrasted with the taxation of all the growth of variable annuities at income rates, means that in most cases, variable annuities shouldn’t be used for tax shelters unless very long holding periods apply (for example, more than 20 years).

Also, any withdrawals before an investor reaches the age of 59 are generally subject to a 10% tax penalty in addition to any gain being taxed as ordinary income.

In the October 2003 edition of Wealth Manager, an article titled “Photo Finish” by W. McAfee, Jr. examined the effects of taxation on annuities relative to other investment vehicles. The author found that annuities are generally not effective as a tax deferral vehicle and that there are significant flaws in the use of annuities for financial planning during the accumulation phase.
[edit] Insurance company default risk and state guaranty associations.

An investor should consider the financial strength of the insurance company that writes annuity contracts. Major insolvencies have occurred at least 62 times since the conspicuous collapse of the Executive Life Insurance Company in 1991.

Insurance company defaults are governed by state law. The laws are, however, broadly similar in most states. Annuity contracts are protected against insurance company insolvency up to a specific dollar limit, often $100,000, but as high as $500,000 in New York, New Jersey, and the state of Washington. This protection is not insurance and is not provided by a government agency. It is provided by an entity called the state Guaranty Association. When an insolvency occurs, the Guaranty Association steps in to protect annuity holders, and decides what to do on a case-by-case basis. Sometimes the contracts will be taken over and fulfilled by a solvent insurance company.

The state Guaranty Association is not a government agency, but states usually require insurance companies to belong to it as a condition of being licensed to do business. The Guaranty Associations of the fifty states are members of a national umbrella association, the National Organization of Life and Health Insurance Guaranty Associations (NOLHGA). The NOLHGA website provides a description of the organization, links to websites for the individual state organizations, and links to the actual text of the governing state laws.

A difference between guaranty association protection and the protection e.g. of bank accounts by FDIC, credit union accounts by NCUA, and brokerage accounts by SIPC, is that it is difficult for consumers to learn about this protection. Usually, state law prohibits insurance agents and companies from using the guaranty association in any advertising and agents are prohibited by statute from using this Web site or the existence of the guaranty association as an inducement to purchase insurance(e.g.). Presumably this is a response to concerns by stronger insurance companies about moral hazard.

U.S. taxpayers are still owed $132.9 billion by companies that benefited from the financial bailout and haven’t fully repaid. Some of that money will never be recovered, a government watchdog said.

Big companies like General Motors and AIG, which benefited from the bailout, still owe U.S. taxpayers $132.9 billion. Some of that money will never be recovered, a government watchdog said.

Christy Romero, the acting special inspector general for the $700 billion bailout, has said the bailout that began in September of 2008, could actually last for several more years. Romero told The Associated Press that some bailout programs such as the effort to reduce home foreclosures will last up to 2017 and such programs could cost an additional $50 billion or more.
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American International Group Inc., which is among the largest of the reported 458 bailed-out companies, owes approximately $50 billion. Other big names such as General Motors Co. and Ally Financial Inc. owe $25 billion and about $12 billion respectively.

Unemployment line in SpainSpain Unemployment: Jobless Numbers Pass 5-Million Mark

Cargo containers are seen at the Port of Long Beach, CaliforniaU.S. 4Q GDP Grew 2.8%, Fastest Pace in 2011 — Weaker Q1?

Following the 2008 financial crisis, Congress had authorized $700 billion for the bailout of financial companies and automakers. This is called Troubled Asset Relief Program, or TARP, and about $413 billion was lent out. The government has recovered approximately $318 billion, or about 77 percent of it so far, according to reports. The Treasury bailed out companies in the form of loans and converted its loans to some of the recipients into common shares in those companies.

Reports are that those shares are now trading below Treasury’s break-even prices.

“TARP is not over,” Romero noted in a statement to The AP.

A break down of some of what’s owed

Romero said 371 banks still owe money. Some of those banks are:

- Regions Financial Corp.: $3.5 billion;

- Zions Bancorporation: $1.4 billion;

- Synovus Financial Corp.: $967.9 million;

- Popular Inc.: $935 million;

- First Bancorp of San Juan, Puerto Rico: $400 million; and

- M&T Bank Corp.: $381.5 million.

The Star Tribune reported that Treasury spokesman Matt Anderson said that the department “has made substantial progress winding down TARP and has already recovered more than 77 percent of the funds disbursed for the program, through repayments and other income.”

He added that the department will “continue to balance the important goals of exiting our investments as soon as practicable and maximizing value for taxpayers.”

Businesses possess their own unique alchemy that results in a plethora of phenomena for researchers to explore. The employees and employers with whom they work also greatly benefit from the discoveries, as an enhanced understanding of the environment means an enhanced understanding of what needs to be done to smooth out any common issues. As one can probably assume, far, far more than 15 helpful studies exist shedding light on strategies both helping and hindering the health, safety, and efficiency of the office. But the following sure do make for an interesting, insightful start.


1. Forty percent of workers find their jobs “very or extremely stressful”:

A 1992 Northwestern National Life Insurance study still garnering attention today noted that 40% of American employees labeled their positions “very or extremely stressful.” It also revealed that one out of every four of these workers considered their careers the No. 1 source of stress in their lives. Suffice it to say, this makes job-related anxiety something of a public health issue.

2.Even nutritious diets can’t offset sedentary office lifestyles:

Meanwhile, back in the dark ages of 2010, a University of Rochester publication discovered that the ravages of workplace stress won’t dissipate in spite of a healthy diet. Of the 2,782 employees surveyed, between 72% and 75% qualified as overweight or obese regardless of whether or not they practiced proper nutrition. Researchers blame the largely sedentary lifestyle of the modern office drone, meaning exercise stands as pretty much the only viable solution to combating this less-than-healthy corporate lifestyle.

3. Sexual harassment hinders job performance:

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The anti-PC will just love hearing the results of a study published in Psychology of Women Quarterly, which — to nobody with one functioning neuron’s surprise — studied the correlation between workplace sexual harassment and compromised performance. No matter the gender of the victim or perpetrator, the dehumanizing practice creates a hostile work environment and its many anxieties deplete productivity and quality alike; it isn’t exactly “fun” or “cute” to constantly contend with objectification. Age, however, did play a role in how roughly sexual harassment hurt employees. Younger workers were more likely to suffer than their older contemporaries.

4. General bullying is actually more detrimental than sexual harassment:

The reason is probably because it’s more widespread, according to experts at University of Manitoba and Queen’s University. Their study pored over 110 reports published over the span of two decades in order to assess the damage’s true scope. Because legislation now protects against sexual harassment in the workplace, bullying through legal means such as intimidation, harsh and unwarranted criticism, denying information and resource access, and more continues unaddressed. Eighty-six out of 128 samples claimed some form of bullying occurs in their workplace, compared to 46 for sexual harassment and six for both dehumanizing behaviors.

5. Even workers passionate about their jobs suffer from severe burnout:

Université du Quebec à Montreal recognizes two different types of passion, identified by psychologist Robert J. Vallerand as “obsessive” and “harmonious.” Their studies focused on nurses in two different cultures (French and Quebecois) and identified that those harboring the former, more chaotic mindset were more at risk of burning out on the job than their counterparts enjoying the latter. In fact, nurses possessing harmonious passion actually reported higher rates of job satisfaction and fewer conflicts.

6.Telecommuting workers are happy workers:

Away from the confines of office politics, spontaneous scrutiny, interruptions, and work-life balance issues, telecommuters thrive. Professors Kathryn L. Fonner (University of Wisconsin-Milwaukee) and Michael E. Roloff (Northwestern University) peered into the differences between telecommuting employees and their office-based counterparts, noting some fascinating findings. Specifically, stepping out of a workplace setting and nestling into something more personal improves performance and overall job satisfaction. Many companies still express reticence over allowing remote employees, but technological improvements make it easier and easier for them to accept, which will hopefully result in a healthier, more productive work force.

7.Engineering still fails at engaging women:

Only 11% of the engineering industry is of the female persuasion, although they make up 20% of graduates, discovered Nadya Fouad and Dr. Romila Singh. Around 1/3 of women who never enter their respective fields say they do so because of their perceptions painting engineering as a complete boy’s club. Of those who worked and eventually left, around half cited “working conditions,” “too much travel,” “lack of advancement,” and “low salary” as their primary motivation. Most disconcertingly, one out of every three felt either their boss, office, or the engineering industry as a whole proved unsuitable to their career needs.

8. Jargon makes audiences suspicious:

Corporate types employing highly specialized (often meaningless) language sow despair more than they inspire. A general communications psychology study by University of Basel and New York University revealed that obscure, jargon-y words and passive voice arouse suspicion above all else. Effective workplace leaders know how to convey goals and instructions clearly to earn their employees’ loyalty and ensure success.
9. Once the economy improves, 1/3 of American workers will be seeking employment elsewhere:

According to the 2010 Deloitte LLP Ethics & Workplace Survey, 65% of Fortune 1000 executives believe trust to be the motivating factor in employees quitting en masse once the American economy stops slumping. They’re not far off the mark. One-third of workers hope to switch jobs after economic stabilization, and a staggering 48% state losing faith and trust in their employers exists as their primary reason. A further 46% say they plan to bolt because of opaque communication between higher-ups and the lower echelons of the hierarchy.

10. Smokers generally suffer from lessened productivity than non-smokers:

Exceptions exist, of course, because exceptions always exist. But a Free University of Amsterdam survey of more than 14,000 Swedish employees discovered that smokers, on average, end up taking 11 more sick days than their abstaining contemporaries and suffer from poorer health. In addition, their performance suffers from taking frequent smoke breaks, which aren’t usually supposed to last more than 15 minutes but still stretch out sometimes. Gallup conducted a poll in 2000 revealing that 95% of American workers supported either an across-the-board smoking-at-work ban or severely limited breaks confined to specially ventilated areas.

11. Social media is definitely a thing that happens a lot:

Not to the point companies need to ban it outright, though, says Adrian Ott’s analysis of People-OnTheGo founder and CEO Pierre Khawand’s findings. He realized that an average of four hours of the workday goes toward juggling “multiple inboxes” for both professional and personal reasons, although only 6.8% say they keep up with social media purely because of work obligations. Although 80% of Gen-Y American employees admit they Facebook it up while on the clock, LinkedIn reigns supreme among management (63.8%), marketing (73.9%), and sales (74.2%) types.

12. American workplaces are getting more and more hostile:

Eighty percent of Americans believe they experienced rudeness radiating from their coworkers, and their offices only seem to be getting worse and worse, according to a Florida International University and Indiana Wesleyan University joint study. Even more disconcerting is the fact that 90% of respondents admit they themselves perpetuated the hostility! The culprit shouldn’t exactly surprise anyone. Increased job-related stress and anxiety owing to the spectacularly terrible economy spill over into work relationships and allow the problem to continue festering.

13. “White collar” workers are most at risk of information overload:

A worldwide productivity survey conducted by LexisNexis in 2010 put numbers to the increasing issue of information overload and overstimulation. Chinese workers suffer the worst, with 62% saying they’re close to hitting “the breaking point,” compared to 56% of South Africans, 51% of Australians, and 56% of both Americans and British participants. On average, about 51% find the amount of data crammed into their brains daily overwhelming to the point of near-burnout and exhaustion.

14. Dogs enable a happier, healthier and more productive workplace:

Man’s oft-touted best friend apparently delights owners in the workplace just as much as it does back at home. Research conducted at Central Michigan University and presented at the International Society for Human Ethology hooked some office groups of four with a canine companion and recorded their reactions, tested against those without. The ones enjoying a doggie running around reported easier coordination with their peers when working on a group assignment than those sans canidae. When it came time for them to assess their peers’ performances, they scored one another far more positively “on measures of trust, team cohesion, and intimacy” as well.

15.Employees in happier workplaces live longer lives:

The results of a two-decade study conducted by Tel Aviv University peered into the lives of 820 employees between the ages of 25 and 65 who worked an average of 8.8 hours a day. Out of the 53 who died during the research’s course, the vast majority suffered from an inability to socially gel with their contemporaries or a hostile work environment. Correlation doesn’t always equal causation, of course, but the connection does make medical sense. It’s pretty common knowledge by this point that individuals capable of forging healthy, mutually beneficial, and supportive relationships with others typically enjoy an extended lifespan.

A company’s reputation is based on the satisfaction level of its customer, its financial performance, and its ability to tackle problems. Here is a list of the worst companies in U.S.
Charter Communications

Charter Communications has been ranked as the worst Internet Service Providers and its services as the worst among all the major national carriers. Charter redirected the error pages and the Windows Live Search results to the Charter’s page, without informing the customers. If any customer wanted to opt out of the option to be redirected, they had to click a link on Charter’s search page. The main problem was that while opting out, the link would install a cookie on the customer’s computers, and in order to delete the cookie, they would be required to opt out again.

In 2008, Charter reportedly deleted the email accounts of 14,000 customers during a routine sweep of the inactive accounts, which made the removed data irretrievable. Though it refused to pay any compensation to the customers, it finally decided to give a $50 account credit to each of the affected user. Its customers generally filed complaints regarding the improper billing practices and the poor customer service.

Four former Charter executives were framed for accounting frauds in 2005. In 2008, Charter announced its plans to monitor the websites visited by its high-speed Internet users via a partnership with NebuAd, but had to change its plan after many customers voiced their concerns. The company has been under financial pressure and filed for bankruptcy in March 2009, but emerged out of it in November 2009.

United Airlines

United Airlines has faced a lot of customer complaints regarding to extremely long delays of the flights, and the exorbitant baggage fees. In 2002, United Airways filed for bankruptcy, as it failed to keep its costs under control, which along with the rising oil prices made United loss $2.14 billion. It tried to cut down costs with its employees, suppliers and contractors. In 2005, it cancelled its pension plans, which was the largest such default in the U.S. corporate history. After implementing a restructuring in 2006, United finally returned to normal operations.

The merger with Continental Airlines had negative impacts on customer services. The Air Line Pilots Associations sued the company saying that the revised operating procedures were inadequate to maintain the levels of safety. The merger led to the check-in kiosks being inoperative, flight delays, and loss of baggage.

Comcast

The company has been in the loop of a lot of criticism for its stance on net neutrality, and poor levels of customer satis
faction. The common complaints included poor communication with the customers when it came to updates and changes in the billing systems, making the channels unavailable for customers who didn’t update to digital cable, long waiting time for technicians, and a very steep increase in prices. Comcast is also stated to having spent millions of dollars on lobbying relations with the government. Though Comcast is a largest cable company on the basis of its revenues, it is equally big when it came to providing the worst customer services.

Time Warner Cable

The company has been into a lot of controversies with regards to bandwidth metering, agreement to local stations, and cable and on-demand channels. The common complaints were centered around fraudulent business acts and bad services, capping the usage by customers, limited support for public access television, and a steep increase in the prices. In 2008, the company started capping the customer’s broadband usage. In 2010, Time Warner Cable’s transmission on the kids channels was interrupted by a programming by Playboy TV for around two hours.

Time Warner enjoyed a long period of monopoly, which enabled it to rule its customers with its own policies, but the increasing competition from the satellite companies, forced Time Warner to provide better services.

Delta Airlines

Delta has been ranked the worst U.S. airline for a long period and the usual complaints revolved around flight delays, exorbitant baggage fees, and service cutbacks. The other controversies the company has been involved related to its free upgrades and lining the pockets of policymakers, a lousy service, and their refusal to let people use their frequent flier miles. In 2005, Delta filed for bankruptcy, owing to increasing fuel prices, lot of competition and a declining inflow of cash. The sacrifices made by all, from the employees to the management, pulled Delta out of bankruptcy in 2007.

Delta acquired Northwest Airlines in 2008, to form the world’s largest airline in terms of schedules passengers carried, after which the level of customer satisfaction dropped further.

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Corporations are notorious for being formal and stuffy, but not all big businesses are created equal. Over the last decade, more big-name companies are ditching the standard suit and tie and allowing their employees to wear khakis, jeans, and even (gasp!) flip-flops. These trend-setting companies have gone above and beyond the business norms to provide a comfortable and fun working environment for their employees, while providing awesome amenities like free gym memberships, complimentary dry cleaning, and on-site chefs to meet their daily needs. Check out these 10 big businesses with incredibly casual offices.

1. Google. Google was one of the first companies to adopt the laid-back corporate culture that emphasized creativity and achievements on an individual basis that add to the team’s overall success. One of the company’s 10 principle philosophies is “you can be serious without a suit.” This philosophy speaks volumes for the casual culture of Google. Not only is the dress code casual, but the overall look and feel of the company’s headquarters in Mountain View, Calif., is also laid back and fun. Google employees can enjoy ping pong, snacks in the break rooms, video games, and “huddle” rooms for everyone to take a break. Some additional office amenities include massage chairs, foosball and ping pong tables, an onsite gym, haircuts, and complimentary car washes.
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2. Zappos. Zappos has put a lot of emphasis on its company culture and takes pride in being a casual yet successful business. Even though it was acquired by Amazon in 2009, Zappos has managed to hold on to the same values and company missions that it was founded on. Zappos’ casual work environment takes after the Internet marketing and e-commerce industries, which emphasize comfort over formality to help employees produce their very best work.

3.Facebook. Facebook also adopted a Google-like office culture that consists of casually-dressed, but hardworking youngsters. Facebook has offices in more than 15 countries, some of which have bean bag lounges, kegs, on-site chefs, and plenty of places to kick up your feet and relax. At the Facebook headquarters in Palo Alto, Calif., employees have several unique amenities that fit the laid-back online culture. Workers can break a sweat on the outdoor skate park, play some tunes on the office turn tables, and take care of their laundry or leather repairs without leaving work.

4.Electronic Arts. EA is one of the biggest companies in the video game industry, with an estimated 8,000 employees worldwide. Although most of the EA studios and subsidiaries have embraced a informal office culture, the EA campus in Vancouver is one of the most casual and decked-out facilities within the company. The campus has a state-of-the-art building featuring a theater, restaurants, coffee bars, a complete fitness room, and a full-size soccer field. EA Canada is also the company’s largest and oldest studio, so, naturally, it houses the world’s largest video game test operation and many employees take advantage of this cool feature.

5. Twitter. Twitter is an online social networking service that knows how to have fun. The Twitter offices are located in San Francisco, San Antonio, Boston and New York City, and are chock-full of awesome amenities to keep their employees relaxed and satisfied. Twitter employees get to enjoy everything from free gym memberships, complimentary yoga/Pilates and rock climbing classes, as well as on-site laundry and dry cleaning services.

6. Linkedin. LinkedIn is the world’s largest professional networking site and its Mountain View, Calif., headquarters has one of the most laid-back offices in the country. LinkedIn employees have many benefits and amenities in the office, such as a 24/7 gym with morning boot camp and afternoon yoga/pilates classes, chair massage,s and weekly lectures from entrepreneurs.

7. Quicken Loans. Quicken Loans’ corporate culture is uniquely different from other big-name companies. According to Quicken Loans, the keys to maintaining its competitiveness and great rapport with customers are the so-called ISMs that make up the company philosophy. The online mortgage lender puts more emphasis on the character and attitude of their employees rather than what they do. To enhance the company culture and give back to its employees, Quicken Loans offers some generous benefits and perks. Employees can enjoy 11 paid holidays per calendar year, free cappuccinos and slushies, concert giveaways, and ATM and dry-cleaning services.

8. AOL. AOL has also taken a casual approach to office culture and design. The Internet services and media company has adapted to changes in online culture by revamping their offices and turning them into inspiring and collaborative workspaces. To make this idea happen, AOL moved its West Coast headquarters to a new space in Palo Alto, Calif. Here, the company did away with private offices and designed open workstations and shared spaces, including a game room, an open kitchen and cafeteria, break rooms, and much more.

9. Genentech. Genentech has been regarded as one of the best and most desirable places to work, thanks to its unbeatable company culture. The biotech firm has garnered a lot of attention for its legendary perks, including doggie day care, weekly Friday night parties, an on-site farmers’ market, and rich stock options. But it’s not just the great perks that keep employees working for Genentech – they’re also attracted to the company’s emphasis on learning and having the freedom to experiment as they like.

10. Apple. Apple is no stranger to the casual corporate culture, so many companies have adopted over the past few years. Since its inception, Apple has fostered innovation and freedom of expression to make great things happen as a team. Apple’s casual corporate atmosphere started from the beginning when Steve Jobs reportedly walked around the office barefoot. Apple employees have some stellar benefits, including excellent health insurance and satisfactory military-leave pay, as well as awesome amenities like Apple product gifts and meals at Caffe Macs, where you might run into Apple’s top executives.

If you were to Google “Stock Market Volatility”, you would find a wide range of observations, conversations, reports, analyses, recipes, critiques, predictions, alarms, and causal confusion. Books have been written; indices and measuring tools have been created; rationales and conclusions have been proffered. Yet, the volatility remains.

Statisticians, economists, regulators, politicians, and Wall Street gurus have addressed the volatility issue in one manner or another. In fact, each day’s gyrations are explained, reported upon, recorded for later expert analysis, and head scratched about.

The only question I continue to have about all this comical hubbub is why don’t y’all just relax and enjoy it. Jon Methuen nailed it in his August 15, 2011 parody of the financial world’s ridiculous obsession with “volatility”. “A Reasonable Guide To Stock Market Volatility” is a must view — but only for mature adults with a semi-sick sense of humor.

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Decades ago, a nameless college Statistics professor brought me out of a semi-comatose state with an observation about statisticians, politicians, and economists. “In the real world”, he said, “there are liars, damn liars, and any member of the groups just mentioned”. An economist or a politician, armed with a battery of statistics, is an ominous force indeed.

Well, now all the economists and statisticians have high powered computers and the ability to analyze volatility with the same degree of certainty (or is it arrogance) that they have developed with regard to individual-stock risk analysis, economic and geographical sector correlation dynamics, and future prediction in general.

But the volatility (and the uncertainty it either causes or results from, depending upon the expert you listen to) persists.

Modern computers are so powerful, in fact, that economists and statisticians can now calculate the investment prospects of just about anything. So rich in statistics are these masters of probabilities, alphas, betas, correlation coefficients, and standard deviations that the financial world itself has become, mundane, boring, and easy to deal with. Right?

Since they can predict the future with such a high degree of probability, and hedge against any uncertainty with yet another high degree of probability, why then is the financial world in such a chronic state of upheaval? And why-o-why does the volatility, and the uncertainty, remain?

Why the Volatility and Uncertainty Remain

I expect that you are expecting an opinion — yet another opinion — on why the volatility is as pronounced as it seems to be compared with years past. I’ll do that next. But, first a sentence or two on “uncertainty” — the playing field of the NFL (National Financial League). An uncertain environment is the only “for real” certainty you will ever experience in investing. Every investment has some form of risk and uncertainty.

Volatility, on the other hand is simply a force of nature — one that you need to embrace and deal with constructively if you are to succeed as an investor.

But this new force of nature, this extreme volatility that we have been experiencing recently, has been magnified by the darkest forces of the Dismal Science and the changes that it has encouraged in the way financial professionals view the makeup of the modern investment portfolio.

On the bright side, enhanced market volatility enhances the power of the equity and income security trading disciplines and strategies within the Market Cycle Investment Management (MCIM) methodology — an approach to market reality that embraces market turbulence, and harnesses market volatility for results that leave most professionals either speechless or in denial.

But, with no statistical data necessary (or available) to support the following opinion, consider this simplistic rationale for the hyper-volatility of today’s stock market.

Volatility is a function of supply and demand for the common stock of a finite number of dirty, evil, greedy, polluting, congress corrupting, job creating, product and service providing, innovation and wealth developing, foundation supporting, gift giving, tax-collecting corporations to finance their growth and development.

“Tax collecting” raise an eyebrow? Look at a rental car statement or your next hotel bill. Those greedy corporations collect more money for state and local governments than the income tax collectors — but that is a whole ‘nother issue.

Those of us who trade common stocks in general, IGVSI stocks in particular, owe a debt of gratitude to the real volatility creators — the hundreds of thousands of derivative products that bring an entirely speculative kind of indirect supply and demand to the securities markets.

Generally speaking, the fundamental, emotional, political, economic, global, environmental, and psychological forces that impact stock market prices have not changed significantly.

Short term market movements are just as non-predictable as they have ever been — they continue to cause the uncertainty you need to deal with using proven risk minimization techniques like asset allocation diversification and trading.

The key change, the new kid on the block, is the impact of derivative betting mechanisms on the finite number of shares available for trading. Every day on the New York Stock Exchange, thousands of stocks are traded, a billion shares change hands. The average share is “held” for mere minutes.

On top of derivative trading in real things such as sectors, countries, companies, commodities, and industries, we have a myriad of index betting devices, short-long parlor games, option strategies, etc. What’s a simple common share of Exxon to do?

Market volatility is here to stay — at least until multi-level and multi-directional derivatives are relocated to the Las Vegas markets where they belong.

Social networking sites were originally created to connect people, but today’s sites do so much more. Everyone knows that successful careers are built on who you know. So, whether you’re looking for a new job or just wanting to move up in your field, these ten sites can help you move forward.

LinkedIn – The site for professional connections, leads, and jobs. These are all business people, and that’s what you’re looking for. Making connections is an essential part of any career, and, should you find yourself looking to change companies, start a new career, or simply move up in your field, you want a wide range of people to help you achieve your goal.
Facebook – The go-to site for everyone now, Facebook overtook MySpace as the most popular social networking site and caters to millions of users. The ability to make connections and renew acquaintances allows Facebook users to connect with current co-workers and potential employers they may never have come across in the real world. Be careful of what you post and who you friend though, employers will check you out. Join groups that show what kind of worker you are, and avoid things that could reflect negatively.
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Twitter – Tweeting what you are knowledgeable about just may get you noticed. You’d be surprised how many ‘lurkers’ there are on Twitter, and some of those people may be looking for the next big thing in your field. By following groups and individuals in the field you are in, or one you are interested in, you can garner all sorts of useful information. People can pack a lot in a tweet.
Classmates – Reunite with old friends and teachers, bond with classmates you never knew in school, and make new connections worldwide. After all, you never know where your friends have ended up. It could be that the class clown is now a CEO and in despite need of some trustworthy employees. You could be just what he’s looking for.
DeviantART – For those in more creative fields, this site may be the answer for you. Allowing users to post their artwork and original designs, DeviantART provides a medium for artists of all kinds to reach potential employers, gallery owners, and buyers.
MyLife – Similar to Classmates, MyLife helps to reunite former friends, relatives, and loved ones. The added benefit is that you can search for yourself and see what other people will see when they look for you. This will help you to control and edit your web presence, the contents of which could affect your future.
LiveJournal – Another ‘artsy’ site, LiveJournal appeals to the writer/blogger-type artist, which is great exposure for such a private field. Connecting to communities and showing off your skills could help move you forward. You never know who’ll be reading.
MySpace – Ah, the old version of Facebook. Sad to say, MySpace has lost its appeal for many, but it is still the tried and true for some companies. Keep it updated and pertinent; you might be surprised by who is still there.
Perfspot – The perfect spot for college grads and young professionals, Perfspot is poised to be the new ‘it’ thing in social networking. Connect with other young professionals and share tips, job offers, and info.
Ecademy – A membership organization for entrepreneurs and small business owners, this site is not free, but it offers help on how to effectively use social networking in your business. Use this site to grow your small business, or just learn how to use social networking to strengthen your ties to the community.

In this increasingly digital age, everyone has a web presence, whether they know it or not. Be aware of what you look like to others online and how that affects your marketability. Use social networking to your advantage, like it was intended to be. And whatever you do, don’t forget- what gets put online, stays online. Forever.

This won’t take long, but think about the message and act accordingly.

Never, ever, in the history of the investment world has a major correction in the stock market not been a major buying opportunity — particularly in Investment Grade Value Stocks (IGVS).

Always, every time and without exception, the general media has predicted the end of the financial world, financial experts have pointed out the remarkable differences from the last correction, and investors everywhere have been encouraged to take their losses and sit on cash or gold until the smoke clears.

Every time, the short sighted fear mongers have been wrong. Not just most of the time mind you — absolutely all of the time. Similarly, the investing public has always been mesmerized into a take-no-further-action coma by whomever and whatever they listen to.

At the same time, every time, without exception, while the financial markets plummet out of control down the most recent “Double Black Diamond” Wall Street favorite, the few investors who practice Market Cycle Investment Management are collecting IGVSs in their cash rich shopping carts, preparing for the next “Silver Bullet” up the mountain.

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Without exception, every time, like sheep being led to slaughter, most investors wait until the market rises within striking distance of old All Time Highs to hop back on the train. The higher it rumbles up the chart’s “mountain” formation, the more “all in” their mentality takes them until, once again, the train races back down the mountain to the valley below.

Never, ever, in the investment world has a major rally in the stock market not been a major selling opportunity — and, interestingly, Investment Grade Value Stocks always seem to lead the way back to the top of the next mountain. Every time except in 1999 – 2001, when there were no IGVSs on the big-rock-candy-mountain the train was climbing.

Always, every time and without exception, the general media has predicted new market highs, financial experts have freight trains full of evidence that this rally will be longer, higher, faster, and more self-sustaining than ever before. Investors everywhere are encouraged to get in the market right now for the ultimate new ride to secure their financial freedom.

And, every time, the media and the financial experts have been wrong. Not just most of the time mind you — absolutely all of the time. Similarly, the investing public (particularly 401(k) investors) always translates their “paper wealth” into non-refundable retirement entitlements. Always and forever they are “mesmatized” (sic) into a complacent “I’m ready to retire right now with this pile of money — my money, my entitlement.” What could possibly go wrong?

At the same time, every time, without exception, while the financial markets surge out of control in the cable car up to the new summit, the few investors who practice Market Cycle Investment Management are busily reaping reasonable profits, avoiding much-too-high-priced-speculations, growing income, and conserving cash, in preparation for the next giant slalom down the mountain. Schwoosh!

The most glaring recent examples are 1987 – 1988, 2000 – 2001, and 2007 – 2008. Is 2011 – 2012 next? Does it matter? Is this really the one time in the financial history of the planet that there will not be a recovery from a stock market correction? I doubt it, seriously.

… ya follow? Time to get busy.

The true enemy is not necessarily Wall Street and its counterparts, it is the Federal Reserve. Wall Street’s greed created the housing bubble and subsequent collapse but it was saved by both the US Treasury and FR. The FR secretly loaned $1.2 trillion in public money to Wall Street firms before the Treasury even stepped in. The FR is the safety net for the criminals of Wall Street and until that source is cut, Wall Street will remain backed by the most powerful corporation in the United States.

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Let us fight for a new world, a decent world that will give men a chance to work, that will give you the future and old age and security. By the promise of these things, brutes have risen to power, but they lie. They do not fulfil their promise, they never will. Dictators free themselves but they enslave the people Let us fight for a world of reason, a world where science and progress will lead to all men’s happiness. Let us all unite!”- Charlie Chaplin.