How Do Islamic Banks Make Money?

A young man makes his career choice and decides to become a successful banker, just like his father. He wants to prepare for the role and asks his father “What must I do to become a successful banker, just like you?” “Son,” says the father, “You must follow these three simple rules: first, don’t lend money to those who don’t have any; second, don’t lend money to those who need it badly; and third, the most important, don’t lend your own money.” Sound advice in these troubled times. It is a shame that many of today’s bankers either never received this sound advice, or ignored it!

In a previous article I presented the argument that Islamic banking institutions were weathering the present financial crisis comparatively well as they were, or certainly should be, insulated from the disasters in the interbank market and the mess in the derivatives markets. A number of readers raised the logical question of how Islamic banks manage to stay in business without charging interest.

To recap, one of the basic principles of Islamic banking is the prohibition of riba (usury or interest). Up until the 1980s riba was generally interpreted to only apply to usury but it is now accepted practice to refer to all interest. Other principles are based on simple morality and common sense, which are by no means unique to Islam. For example, usury was also prohibited by the Old as well as the New Testament. Even literary heavyweights such as Shakespeare weighed in against the practice.

Islamic banking is also by no means a recent phenomenon. The basic practices can be traced back to the early parts of the seventh century. Some experts even claim that many of the concepts and techniques so familiar to us today were later adopted by European bankers. Its fairly recent reemergence coincided with rising oil prices in the mid 1970s thus providing parts of the Muslim world with significant financial resources. The other crucial element was the accompanying search for ethical values in managing their financial affairs, something many of the traditionally western financial organisations could not provide. As this is a trend not only applicable to the Muslim world, the emerging Islamic banks are increasingly being accepted by non-Muslims who do not wish to invest in, or even deposit their savings with companies engaged in unethical and socially harmful activities, such as dealing in alcohol, gambling, pornography and tobacco.

The Islamic economic system is concerned with social justice to ensure that none of the parties involved in a transaction is being exploited without at the same time inhibiting individual enterprise. Extended to the Islamic financial system, this means that the funds individuals and/or companies put at risk share the profits or losses resulting from the enterprise. This concept of sharing the delights or pain of the outcome of business is a progressive one. To paraphrase Charles Darwin “It is not the strongest financial system that survives, nor the most intelligent. It is the one that is most adaptable to change.” Islamic banking encourages better resources management, in particular as outright speculation is not permitted by Shariah, ie Islamic law. The participants are keeping pace with sophisticated techniques and have developed products that are not only ethically motivated but also profitable.

Islamic financial solutions generally have Arabic names thus intimidating many potential buyers into saying it is all too complicated. At their core, most of these products are essentially the same as their conventional equivalents. The main differences are the absence of interest and often complicated procedures to ensure compliance with Shariah law.

For example, in Islamic housing finance the risks involved are shared between the bank and the borrower, rather than transferring all the risk to the latter. The most commonly used contract is the diminishing musharaka (partnership) contract. In this case the bank and the borrower form a partnership, with the bank providing up to 95 percent of the purchase price, and the borrower 5 percent.

The borrower buys out the ownership share of the bank which makes its profit from the rent paid by the client for the share the bank owns. This happens over a period of, usually, 15 to 30 years.

Should the borrower default on a rental or principal repayment, the bank may advance the borrower an interest-free loan to enable him to continue their payments in anticipation that he will pay in full when he is able to. The good news is that during this period of distress, the borrower retains his home rather than face eviction.

Having said this, Islamic banks still appraise credit risk, and indeed are more cautious about who they finance than conventional banks.

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What Is The Truth About Trends in Binary Options Trading?

Binary Options Trends are made easy by knowing how and where the financial marketplace will lead. Trends are what all binary and forex traders look for and try to decipher.

I gave you a little insight on how Binary Options Made Easy works in my first article, now I will dive a little deeper into the aspects of this exciting trading Platform.

One Hour Options, as they are called, can be viewed as a financial market instrument while traders have a versatile approach without the problems involved while executing regular “vanilla options” as they are referred as.

Whether or not you are looking for a short term projection of your binary options trend or hedging your trades, trending can help you obtain higher payouts in a shorter trading period. This way of forecasting trend movement is achieving recognition with traders worldwide. Forex binary traders are being drawn in by the simple to use binary platform and they can be in and out of a trade in less than 30 minutes.

These All or Nothing Options are available in a wide range of underlying assets such as Indices, Commodities, Currencies (Forex market) and Stocks. No matter if the trader has taken a call (rise in price) or put (a decline in price), the contract has a time period in which the trader has to be correct with regards to the vision in direction of the underlying resource cost, then they will be in the money.

But on the other side of the coin if the trader has picked the underlying asset incorrectly then the trade will stop out of the money. Many binary options companies are starting to use what is called a “roll over”. That is when if you think your binary options trade will finish out of the money you can roll your wager over to the next hour and pay a fee in order to continue the trade.

Being able to easily pick out the trends in Binary Options Trading is what it is all about. Since many times you only have one hour to make your decisions you need to better understand what trending is all about. Since we are making Binary Option trading easy to see the direction in which any commodity can move you need to focus on the short term strategies. Binary Options made easy can give you a better understanding of why the Options markets move as they do.

There is a reason, now all you have to do is learn the principles of good money management, the ease of the binary platform and strict control of your emotions and you are on your way to making some great money. But be forewarned if you are looking to do this full time treat this as a business and not gambling.

Cyberethics (Information System Ethics)

In order to examine ethical issues, it is first necessary to define ethics. Today, we regard ethics as a “rational process founded on certain principles.” However, I believe a definition that is more applicable to this project is the ethical theory that existed in ancient Greece. There, ethics was the study of what was good for both the individual and society. We will look at some online issues and how they may be good and/or bad for society. Cyberethics is quite simply the study of ethics on the Internet.

“Ethics begins when elements within a moral system conflict.”

Cyberethics is often called as Information System Ethics. Information System ethics can be defined as “The study of moral, legal, ethical issues involving the use of information and communication technologies”

There are many unique challenges we face in this age of information. They stem from the nature of information itself. Information is the means through which the mind expands and increases its capacity to achieve its goals, often as the result of an input from another mind. Thus, information forms the intellectual capital from which human beings craft their lives and secure dignity.

However, the building of intellectual capital is vulnerable in many ways. For example, people’s intellectual capital is impaired whenever they lose their personal information without being compensated for it, when they are precluded access to information which is of value to them, when they have revealed information they hold intimate, or when they find out that the information upon which their living depends is in error. The social contract among people in the information age must deal with these threats to human dignity. The ethical issues involved are many and varied in Information System Ethics.

Ethics is required in information Systems to overcome the following ethical issues.

Privacy: What information about one’s self or one’s associations must a person reveal to others, under what conditions and with what safeguards? What things can people keep to themselves and not be forced to reveal to others?

Accuracy: Who is responsible for the authenticity, fidelity and accuracy of information? Similarly, who is to be held accountable for errors in information and how is the injured party to be made whole?

Property: Who owns information? What are the just and fair prices for its exchange? Who owns the channels, especially the airways, through which information is transmitted? How should access to this scarce resource be allocated?

Accessibility: What information does a person or an organization have a right or a privilege to obtain, under what conditions and with what safeguards?

Information System ethics explores and evaluates:

o the development of moral values in the information field,

o the creation of new power structures in the information field, information myths,

o hidden contradictions and intentionality’s in information theories and practices,

o the development of ethical conflicts in the information field. etc

Now let us take a look at privacy by the following examples. A few years ago, Florida lawmakers gave the go ahead to have monitors stationed in bathrooms at Tallahassee Community College to determine if the facilities were being underutilized. Students and faculty vehemently protested that the monitors violated their privacy. State officials said that the value of the information gained through the study was more important than the threat to privacy. Other issues like collection of private data of the users using internet by monitoring the traffic is strongly related to one’s policy as that information can be further used for illegal purposes. These types of privacy issues are needed to be addressed properly so that they should not exploit one’s freedom. One issue that I kept thinking about when I was constructing my Web page was whether it was ethical to lift an image from someone’s home page and use it on my Web page without crediting the source. Such ethical issues come under property.

One reason that topics such as online gambling and pornography have become such firestorms of controversy in cyberspace is the simple fact that so many people have access to the Web sites. Simply put, if no one had access to online pornography no one would care. With this another issue “Censorship” comes which should be deal in efficient way as it is not easy to implement. Ethical issues can also be religious, moral or any other.These type of issues are not easy to deal with.

Similarly, let us take China into consideration on the issue of “Censorship”. China has implemented the methods of censoring the internet that are somewhat harder to bypass for people generally unfamiliar with the way internet works. There is ,for example internet censorship as implemented in China–using a list of banned words that are censored on the fly. As users in china request a webpage , the incoming page is first inspected by government servers n blocked if a banned term such as “Democracy” is present. Human censors are also actively looking at what people browse on the internet, and block websites as they see fit.

Crimes on internet are also increasing in a continuous manner.Computer crime is a general term that embraces such crimes as phishing, credit card frauds, bank robbery, Industrial espionage, child porn, kidnapping children via chat rooms, scams, cyber terrorism, viruses, spam and so on. All such crimes are computer related and facilitated crimes. Many recent cases seen like Microsoft’s website was brought down for a little time resulting in a huge loss to Microsoft. Similarly, NUST, one of the best considered university in Pakistan got Hacked and redirected to another domain. Credit card fraud have grown in an increasingly manner. Leakage of Military information from internet is another internet crime. Software known as Google earth, which shows information about different places including military land or can lead to robbery planning, is becoming an ethical issue around the world. Many people protest against this leakage of information but still one can’t deny that it is one of the major enhancements in Information Technology.

The question about how to police these crimes has already been constructed, but this task is turning out to be an uphill battle. Since the first computer crime law, the Counterfeit Access Device and Computer Fraud and Abuse Act of 1984, the governments have been trying to track down and stop online criminals. The FBI of different countries have tried many programs and investigations in order to deter Internet crime, like creating an online crime registry for employers .The reality is that Internet criminals are rarely caught. One reason is that hackers will use one computer in one country to hack another computer in another country. And that criminal isn’t working alone. Loosely organized groups–which security experts call “Web gangs”–conduct much of the illegal activity online. The structure of Web gangs may be patterned on that of traditional organized crime, in which the members of the group may never come into contact with one another and may never be aware of who they are working for.

Conclusion:

We live in an exciting time in history. The widespread availability of computers and Internet connections provides unprecedented opportunities to communicate and learn. Unfortunately, although most people use the Internet as a powerful and beneficial tool for communication and education, some individuals exploit the power of the Internet for criminal or terrorist purposes.

We can minimize the harm that such individuals do by learning ourselves, and teaching young people, how to use the Internet safely and responsibly. The term “cyberethics” refers to a code of safe and responsible behavior for the Internet community. Practicing good cyberethics involves understanding the risks of harmful and illegal behavior online and learning how to protect ourselves, and other Internet users, from such behavior. It also involves teaching young people, who may not realize the potential for harm to themselves and others, how to use the Internet safely and responsibly.

How to Trade DITM Options and Buy Stock at Half the Price

Trading DITM options (Deep-in-the-Money) is one of the best swing trading strategies around. By exploiting the high Delta of an option contract, you can effectively trade stocks for only half the risk that you would incur with normal swing trading.  If you can buy the rights to the same amount of stock for half the price, but still make the same profit, you effectively double your return on investment.

This a great strategy for those who are still a bit scared of buying options, but love the challenge of swing trading stocks, and want to gain some leverage on a trade as well as reducing overall risk and cost of investment.  The reason that it can be such a rewarding strategy is that it not only doubles the leverage on a stock trade, but the effect of time decay on the value of the option is minimised.  Swing trades usually have a duration of three to ten days, and if you trade a DITM option for this short period, time decay will not significantly affect the price of the option.

How do you trade DITM Options?

First: Pick your Stock.  You can either use one of your favourite stocks, or you can run a scan for “ready-to-roll” stocks that are perfect for DITM options.  I find that Stockfetcher is the best free resource for finding these stocks, and I have some scans set up for this purpose.

Second: Technical Analysis.  You will need to perform the following steps in order to identify a good swing trade that is suitable for a DITM Option trade:

  • Trend analysis. Establish the trend of both the Market and your stock. Don’t try and buy calls in a falling market!
  • Swing Analysis. Find stocks that have dipped to the bottom of the trend band. These are stocks that are trading between the 10ma and 30ema.
  • Swing Confirmation. Confirm the swing with Candlestick Patterns. Check the RSI and VIX to make sure that a swing reversal is not imminent.

Third: Choose your Option and buy it!

  • Pull up an options table which shows the DELTA of the option. Your broker software should have this feature. Either that or use an Options Calculator, for which you will need to know the volatility of the options. Pick an option that has a DELTA that is at or close to 100.
  • Option Value. Don’t buy overvalued options! You will watch your trade value bleed away. You will need to use software for this – I strongly recommend Volcone Analyser Pro for this (the only bit of this method that is not free!).

Fourth: Set your Stop Loss and Profit Target IMMEDIATELY!

Remember, this is not gambling! Your swing analysis, and confirmed by a look at support and resistance levels, will help you do this.

  • Stop Loss – If you normally set a stop loss of 4% for your stock, then set a stop loss of about 8-10% for your option.
  • Profit Target – set a profit target based on the swing of the underlying stock. Either simply add the dollar value of your anticipated profit to the option price, or use the Option Calculator to work it out. Or use a trailing stop – whatever is your favourite method. Sell the option as soon as you hit your profit target – don’t wait until expiration, otherwise you will lose 100% of your investment! Plan to exit the trade within 10 days or so – if it hasn’t moved by then, the swing analysis dynamics would have changed, and your trade is at risk.

Everything About Life Insurance!

I want to start off this 2010 with an article regarding Life Insurance. Many people find this topic morbid but believe me when I say this contract is as important as a Will and should be taken just as seriously as health insurance. Due to the length in details of this article I have provided chapters for easy reading. I hope this will educate you on Life Insurance and the importance of its necessity. (Note: For better understanding “You” is the policy owner and the insured)

Chapters:

1= Introduction

2=When/If you have Life Insurance already

3= Difference between a Insurance Agent and Broker

4= Types of Policies

5= What are Riders and popular types of Riders

6= The medical exam

1) About general Life Insurance:

This is a contract between you and an insurance company to pay a certain amount (the premium) to a company in exchange for a benefit (called the Death Benefit, face amount, or policy amount) to the beneficiary (the person you want to get paid in the time of your death). This can range based on the type of policy (which will be discussed momentarily), your health, your hobbies, the Insurance company, how much you can afford in premiums, AND the amount of the benefit. It sounds overwhelming but it is not if you have the right agent or broker.

Now many people can say that Life Insurance is like gambling. You are betting that you will die in a specific time and the insurance company bets you won’t. If the insurer wins, they keep the premiums, if you win…well you die and the death benefit goes to the beneficiary. This is a very morbid way of looking at it and if that is the case you can say the same for health insurance, auto insurance, and rental insurance. The truth is, you need life insurance in order to ease the burden of your death. Example 1: A married couple, both professionals that earn very well for a living have a child and like any other family has monthly expenses and 1 of the couple has a death. The odds of the spouse going back to work the next day is very slim. Odds are in fact that your ability to function in your career will lower which RISK the cause of not being able to pay expenses or having to use one’s savings or investments in order to pay for these expenses NOT INCLUDING the death tax and funeral expenses. This can be financially devastating. Example 2: lower middle income family, a death occurs to 1 of the income earners. How will the family be capable of maintaining their current financial lifestyle?

Life insurance is about the ability of lowering the risk of financial burden. This can be in the form of simple cash or taxes via estate planning.

KEY Definitions:

The Insured: The person that is covered by the insurance company (He/She does NOT have to the policy owner)

The (policy) Owner: The one that pays the premium, controls the beneficiary, and basically owns the contract (Does NOT have to the insured…hope you understand it can be either/or).

Face Amount: Also known as the death benefit. The amount to be paid to the beneficiary.

The Beneficiary: Is the person/persons/organization who will receive the face amount (death benefit)

2) When/If you have Life Insurance:

First, you should review your beneficiaries once a year and your policy approximately once every 2-3 years. This is free! You need to make sure the beneficiaries are the people/person you want to get paid! Divorce, death, a disagreement, or anything of the sort can make you change your mind about a particular person to receive the benefit so make sure you have the right people, estate/trust, AND/OR organization (non-profit preferably) to receive the benefit. Furthermore, you need to review every 2-3 years because many companies can offer a lower premium OR raise the benefit if you renew your policy or if you find a competitor that sees you have been paying the premiums may compete for your business. Either way, this is something you should consider to either save money or raise the policy amount! This is a win-win for you so there should be no reason not to do this.

3) Life Insurance Agent or Broker, what is the difference?:

The major difference is an Agent is usually an independent sales man that usually works with different insurance companies in order to give the client the best possible policy while the Broker works for a particular company. My personal advice: always choose an Agent. Not because I am one myself BUT because an agent can look out for your benefit by providing different quotes, types, riders that are available (explained later), AND pros/cons regarding each insurance company. If you don’t like a particular insurance company, tell the agent and he should move on to the next carrier (if he persist for some odd reason, fire him). Buyers BEWARE: The Agent should get paid by the carrier that is chosen, not by you specifically. If an Agent asks for money upfront for anything, RUN! There are also Insurance consultants that you pay but to keep things simple, see an Agent. Consultants and Agents are also great in reviewing current policies in order to lower premiums or increase benefits.

4) Types of Policies:

There are 2 main categories: Term and Permanent Insurance. Within each of the 2 categories have sub-categories. I will explain them at a glance in order for you to make the best possible choice for you and your loved ones. Remember, you can have estate/trust or a organization as the beneficiary. (Note: There are even more sub-sub-categories within these sub-categories but the difference are so small and self explanatory that I have not included it in this article. Once you speak to an agent you will have enough knowledge by this article that you will know what questions to ask and know if you agent is right for you).

Term Insurance: A temporary policy in which the beneficiary is paid only upon death of the insured (you) within a specific time period (hence the word “Term”). Term Insurance is usually less expensive with a smaller death benefit. Some do not require medical exams BUT expect to pay a higher premium since the risk of the insurance company is unknown. Also, term insurance normally does not accumulate cash value (explained in permanent insurance) but can be purchased on top of your permanent policy (for those that may have coverage already):

Convertible Term: Ability to convert policy to permanent. There are some REALLY GOOD policies that require no medical exam, driver history, or hazardous avocations at a certain point in order to convert to permanent coverage guaranteed with all the benefits that permanent insurance policies has to offer.

Renewable Term: Able to renew a term policy without evidence of insurability.

Level Term: Fixed premiums over a certain time period than increases (great for those that are young adults and expect within 10 years to have a increase in pay).

Increasing/Decreasing Term: Coverage increases or decreases throughout the term while the premium remains the same.

Group Term: Usually used for employers or associations. This covers several people in order to reduce premiums. (Great for small business owners)

Permanent Insurance: Just as the name states, this provides coverage throughout the lifetime of the insured. This also builds cash value which is fantastic for tax purposes because if you loan out money to yourself using this cash value there are no tax implications. Few policies may have in general withdrawal tax-free. However in most cases, If you withdraw the cash value you pay the only the taxes on the premiums (the amount that grew) which is fantastic. Just make sure your agent knows not to have the cash value grow larger than the death benefit otherwise it is subject to 10% taxes! Surrender charges may also apply when you withdrawal so PLEASE consult with an agent who can assist you with these details. You should consider Permanent Insurance if you have a family and don’t mind an increase in premiums (amount you pay) by a few dollars compared to term.

Traditional Whole Life: Pay a fixed amount of premium in order to be covered for the insured’s entire life which includes accumulating cash value.

Single-Premium Whole Life Insurance: Whole life insurance for 1 lump sum premium (usually that 1 lump sum is very large in order to get a great death benefit).

Participating Whole Life Insurance: Just like Traditional Whole life except it pays you dividends which can be used as cash OR pay your dividends for you! There is no guarantee that you will be paid the dividends, this is based on performance within the insurance company.

Limited Payment Whole Life Insurance: Limited payments for whole life but requires a higher premium since you are in fact paying for a shorter amount of time. This can be based on payment amounts (10, 20, 30, etc payments) or a particular age (whole life is paid up at age 65, 75, 85, etc).

Universal Life Insurance: Flexible premiums with flexible face amounts (the death benefit) with a unbundled pricing factors. Ex: If you pay X amount, you are covered for X amount.

Indexed Universal Life: Flexible premium/benefit with the cash value is tied to the performance of a particular financial index. Most insurance companies crediting rate (% of growth) will not go below zero.

Variable Life Insurance: Death Benefit and cash value fluctuates according to the investment performance from a separate account of investment options. Usually insurance policies guarantee the benefit will not fall below a specified minimum.

Variable Universal Life Insurance (also called Flexible Premium Variable Life Insurance & Universal Life II/2): A combination of Variable and Universal which has premium/death benefit flexibility as well as investment flexibility.

Last Survivor Universal Life Insurance (also called Survivorship or “Second to die” Insurance): Covers 2 people and the death benefit is only paid when both insurers have died. This is FANTASTIC and somewhat a necessity for families that pay estate taxes (usually High-Net-worth individuals).

5) Life Insurance Riders, what is it and why is it very important:

Rider is the name of a benefit that is added to your policy. This provides special additions to the policy which can be blended and put together. There are SO MANY types of riders that I would have to write a different article regarding Riders (and insurance companies add new types of riders often) but I want to at least name the most popular (and in my opinion, the most important) that you should highly consider when choosing a policy. Riders add to the cost of the premium but don’t take riders lightly; it can be a life saver!

Accidental Death Benefit Rider (AD&D): Additional death benefit will be paid to the beneficiary if you die from a result of an accident (ie: Car accidents, a fall down the stairs). This is especially important if the insurer travels often, relatively young, and has a family. Please note: You can buy AD&D Insurance separately.

Accidental Death & Dismemberment Rider: Same as above BUT if you lose 2 limbs or sight will pay the death benefit. Some policies may offer smaller amounts if losing 1 eye or 1 limb. This is great for those that work with their hands.

Disability Income Rider: You will receive a monthly income if you are totally and permanently disabled. You are guaranteed a specific level of income. Pay attention to this detail, depending on the policy it will either pay you depending on how long the disability lasts OR time frame of the rider.

Guaranteed Insurability Rider: Ability to purchase additional coverage in intervals based on age or policy years without having to check insurance eligibility.

Level Term Rider: Gives you a fixed amount of term insurance added to your permanent policy. This rider can add 3-5 times the death benefit or your policy. Not a bad deal!

Waiver of Premium Rider: If you become disabled which results to the inability to work/earn income, the waiver will exempt you from paying the premiums while your policy is still in force! There is a huge gap between policies and insurance companies so the devils in the details with this rider.

Family Income Benefit Rider: In case of death of the insurer, this rider will provide income for a specific time period for your family.

Accelerated Death Benefit Rider: An insurer that is diagnosed with a terminal illness will receive 25-40% of the death benefit of the base policy (The decision is made between the insurer and the insurance company). This will lower the death benefit however depending on your finances or living lifestyle, this rider should not be taken lightly and should seriously be considered.

Long-Term Care Rider: If the insurer’s health compels to stay in a nursing home or receive care at home, this rider will provide monthly payments. Please Note: Long Term Care insurance can be bought separately for more benefit.

6) The Medical Exam:

This section is not to scary you away but to mentally (and possibly physically) prepare you for the medical exam so this way you know what to expect and can get the lowest possible premiums while receiving the highest possible death benefit. This really shouldn’t be a concern if you work out regularly and maintain a healthy eating habit (notice I said habit and not diet. Diets don’t work for long term).

The exam is mandatory for most insurance policies. Many term insurance do not require one but expect a low death benefit and/or higher premium. The idea of the exam is not just to see if you’re insurable but to also see how much they will charge the insurer/policy owner. The exam is done by a “paramedical” professional that are independent contractors hired by the insurance company who either come to your home or has an office where you/the insurer visit. They are licensed health professionals so they know what to look for! In very few cases the insurance company may ask for an “Attending Physician Statement (APS)” from your doctor. This must be provided by your doctor and NOT copies by you. TIP: The “paramedical” job is to give the insurance company a reason to increase your premiums so don’t give any details that are not asked.

First part (either called Part 1 or Part A) is complete by the Agent or by you. Part 2/B is the paramedical or physician portion. The best bet is to have your agent contact a paramedical that specializes in mobile exams for an easier exam for you. Paramedical will contact you to schedule an appointment. The exam is not optional so it’s not a matter of yes or no but when and where. This entire exam will cost you nothing except time so make the time, life insurance is important!

The paramedical/physician will take your medical history (questions), physical measurements of height and weight, blood pressure, pulse, blood, and urine. Additional tests will vary based on age and policy amount (yes, the higher the death benefit = the more tests that must be provided). Now if the policy is substantial, the insurance company may not send a paramedical but require an actual Medical Doctor to exam you. Of course, this is chosen by the insurance company so remember my tip earlier! This exam may even include a treadmill test and additional crazy exams in order to see if you qualify for that substantial amount and low premium. On the flip side, if you choose a low insurance policy, you will just have a paramedical doing simple tests that mentioned earlier with no additional exams.

What they are looking for: Paramedical/Physicians are looking for health conditions that may shorten your life. Remember, insurance companies are here to make a business and if you’re a liability then it might be a risk they do not want to take or raise the premium to make the risk tolerable. Blood and urine is taken to see the following:

– your antibodies or antigens to HIV

– Cholesterol and related lipids

– Antibodies to hepatitis

– Liver/kidney disorders

– Diabetes

– Immunity disorders

– Prostate specific antigen (PSA)

– Drug tests such as cocaine

The Results: They are sent directly to the insurance company’s home office underwriters for review. Many times you can request (must be written request) to receive a copy of the results however many insurance companies will automatically do this. Many times they will find abnormalities but it’s usually not a concern and just speak to your medical professional for a follow up (remember: the insurance company will look at these exams with a “fine tooth cone” in order to see what the risk are). The underwriters will look at the exam results and the application (remember part 1/a? well, now they want to see if your also lying) and determine the premium amount. Smokers pay more; any nicotine in your system will consider you a smoker, even if it is just socially.

The premium is determined by a category that you fit in. This really depends on the insurance company on how they factor but the general rule is if you are a higher risk, you pay higher premium. If you are standard risk, you will pay a standard premium, and if you are a preferred risk, you will pay a low premium.

You can decline the policy after you receive the final quote after the exam but do remember this: All results will become part of the MIB group’s database (Medical information Bureau). This is a clearinghouse of medical information that insurance companies use to store information after you apply for Life/Health/Disability Income/Long Term care/Critical Illness insurance. So for seven years it will be on database. You can receive a free report annually (like a credit check) at their website which I included at the bottom of this article.

Now that you know practically everything there is to know about life insurance. I hope you realize how important it is. It may seem like a lot but the hardest part is simply choosing what type of policy is right for you. This can be done with the help of your Agent. In the end, everyone is different and everyone should analyze their own situation and need for the beneficiaries. If you have even the slightest concern for a loved one regarding what will happen if you was no longer with us then you should consider life insurance. There truly is a feeling a relief once you know you and your loved ones are covered regardless of how much you or that person makes. For many that feel that their loved ones don’t need the death benefit due to whatever the case may be (“they earn enough money to survive” is the biggest reason I hear against life insurance), this can be a simple last gesture of “I love you” or appreciation for them being part of your life.

I hope I was able to educate you in Life Insurance and if you have any additional questions please feel free to email me.

MIB website: http://www.mib.com/html/request_your_record.html

The Wild West Crypto Show Continues

Here is a question that comes up often: How do I choose which crypto currency to invest in – aren’t they all the same?

There is no doubt that Bitcoin has captured the lion’s share of the crypto currency (CC) market, and that is largely due to its FAME. This phenomenon is much like what is happening in national politics around the world, where a candidate captures the majority of votes based on FAME, rather than any proven abilities or qualifications to govern a nation. Bitcoin is the pioneer in this market space and continues to garner almost all of the market headlines. This FAME does not mean that it is perfect for the job, and it is fairly well known that Bitcoin has limitations and problems that need to be resolved, however, there is disagreement in the Bitcoin world on how best to resolve the problems. As the problems fester, there is ongoing opportunity for developers to initiate new coins that address particular situations, and thus distinguish themselves from the approximately 1300 other coins in this market space. Let’s look at two Bitcoin rivals and explore how they differ from Bitcoin, and from each other:

Ethereum (ETH) – The Ethereum coin is known as ETHER. The main difference from Bitcoin is that Ethereum uses “smart contracts” which are account holding objects on the Ethereum blockchain. Smart Contracts are defined by their creators and they can interact with other contracts, make decisions, store data, and send ETHER to others. The execution and services they offer are provided by the Ethereum network, all of which is beyond what the Bitcoin or any other blockchain network can do. Smart Contracts can act as your autonomous agent, obeying your instructions and rules for spending currency and initiating other transactions on the Ethereum network.

Ripple (XRP) – This coin and the Ripple network also have unique features that make it much more than just a digital currency like Bitcoin. Ripple has developed the Ripple Transaction Protocol (RTXP), a powerful financial tool that allows exchanges on the Ripple network to transfer funds quickly and efficiently. The basic idea is to place money in “gateways” where only those who know the password can unlock the funds. For financial institutions this opens up huge possibilities, as it simplifies cross-border payments, reduces costs, and provides transparency and security. This is all done with creative and intelligent use of blockchain technology.

The mainstream media is covering this market with breaking news stories almost every day, however, there is little depth to their stories… they are mostly just dramatic headlines.

The Wild West show continues…

The 5 stocks crypto/blockchain picks are up an average of 109% since December 11/17. The wild swings continue with daily gyrations. Yesterday we had South Korea and China the latest to try to shoot down the boom in cryptocurrencies.

On Thursday, South Korea’s justice minister, Park Sang-ki, sent global bitcoin prices temporarily plummeting and virtual coin markets into turmoil when he reportedly said regulators were preparing legislation to ban cryptocurrency trading. Later that same day, the South Korea Ministry of Strategy and Finance, one of the main member agencies of the South Korean government’s cryptocurrency regulation task force, came out and said that their department does not agree with the premature statement of the Ministry of Justice about a potential cryptocurrency trading ban.

While the South Korean government says cryptocurrency trading is nothing more than gambling, and they are worried that the industry will leave many citizens in the poor house, their real concern is a loss of tax revenue. This is the same concern every government has.

China has grown into one of the world’s biggest sources of cryptocurrency mining, but now the government is rumoured to be looking into regulating the electric power used by the mining computers. Over 80% of the electrical power to mine Bitcoin today comes from China. By shutting down miners, the government would make it harder for Bitcoin users to verify transactions. Mining operations will move to other places, but China is particularly attractive due to very low electricity and land costs. If China follows through with this threat, there will be a temporary loss of mining capacity, which would result in Bitcoin users seeing longer timers and higher costs for transaction verification.

This wild ride will continue, and much like the internet boom, we will see some big winners, and eventually, some big losers. Also, similar to the internet boom, or the uranium boom, it is those who get in early who will prosper, while the mass investors always show up at the end, buying in at the top.

Stay Tuned!

The Riskiest Option Trading Strategy Known to Man

Today, I wanted to discuss the riskiest Option Trading Strategy known to man. I am going to go through the strategy and then I am going to give you the names of two other strategies that you will want to stay away from because each one of them is using the risky trade within the strategy. So, let’s get started.

The Option Trading Strategy with the highest risk to an investor is known as selling naked calls or short a call. How this strategy works is as follows:

1. You find a stock you think will not have much upside nor volatility, aka SPECULATING. This should be your first indication that this strategy should not be used.

2. You sell a call naked (this means you do not own the stock, but, you are obligating yourself to selling this specific stock sometime in the future at a predetermined price.)

3. You receive a premium (meaning someone is paying you to have the right to buy the underlying stock, that you do not presently own, from you sometime in the future.)

4. Now, this is where this strategy can get UGLY!! READ BELOW

Selling naked calls (short a call) is gambling. You receive a premium from an investor that gives him the right to buy either from the market or from you, whomever is cheaper. Consider the example below.

You sell one (1) naked call on ABC stock at a strike price of $20. The buyer of your naked call pays you $3. (Alright, you just made $3 per contract, or $300.00)*

The current market price of the stock is $15.

Sounds good so far huh? You have $300 and the stock would have to move from $15 to above $23 ($20 strike price plus the $3 premium) before the person holding the call option would come to you and have you buy the stock at the market price and sell it to him for $20. Well, just to let you know, because there is no ceiling on how high the price of the stock can climb, your risk is UNLIMITED!!

Let say you wake up one morning three weeks into the future and find out the stock that was trading at $15 back when you sold the naked call just spiked up $50 per share. Well, guess what, the person that bought the call from you is doing? He is outside banging down your door to get you to sell him the stock at $20, so he can sell it in the market at $65. What an ugly predicament you are in now. You have to buy the stock at $65 and turn around and relinquish it at $20 leaving you with a loss of $42. (Your cost of $65 minus what you sold it for $20 equals $45. But remember, you were already paid $3, so your loss is $43 per share or $4300.00) OUCH!!

Now granted, this is an extreme example, but it is better to just stay away from selling naked calls so you don’t end up on the wrong side of a run away stock while you were sleeping. Get my drift.

Well, hopefully you understand the risk involved in selling naked calls now, here are two other option trading strategies to avoid like the plague:

short straddle: short a call and short a put

short combination: short a call and short a put (combination will have different strike prices, i.e. sell a 20 call and sell a 30 put)

* One (1) contract equals 100 shares of stock, therefore if you receive $3 per contract, you will receive as a premium $300.00.

New Novel Set in Afghanistan Is Full of Action and Internal Conflict

A. E. Coussens’ new novel Failed State offers an inside look at what the soldiers who fight in Afghanistan, and really around the world, face on a daily basis.

First, we are introduced to Damien Collins, a contract worker who serves the United States military in Afghanistan. Damien is returning home from his service overseas and looking forward to seeing his wife and little girl. He and his wife have been having some problems, including his wife drinking too much, but Damien has no idea of the full extent of those problems until he arrives home to a shocking scene.

We are then taken back to Damien’s recent experiences in Afghanistan. Coussens writes with great knowledge and deftness in his depiction of the Americans who serve in Afghanistan and try to maintain order in the country. Between locals who side with the Taliban and some terrorists, these men rarely have an easy day. Coussens takes us right into a gunfire scene in the city streets and the excruciating pain that follows when Damien and his comrades realize that Loki, one of their men, has been arrested by the Afghanis and is being treated like a criminal for his actions during the conflict.

What follows for Damien is some red tape and some seeming disgrace in being told by his boss that he can no longer serve in Afghanistan. Damien and his comrade Cam are sent to Dubai to rest and recover from their experiences before they return to the United States. In Dubai, more conflict arises, though it’s more internal as we see how Damien struggles with all the stresses in his life both from his work and his home life-or his inability to have a home life.

Meanwhile, the scene changes to show the latest plottings by other terrorists.

To say much more would be to give too much of the plot away. What I can say here is that Coussens’ writing is searingly realistic. I felt like I was patrolling down the streets of Kabul with the characters, seeing every building and waiting every moment for the unexpected to happen. Here’s just a couple of paragraphs from the novel to give you a feeling of Coussens’ knack for making a scene come to life:

“The Kabul-Jalalabad highway east of the city looked apocalyptic. The team’s late model Land Cruiser began to accelerate on the road as they left Kabul behind them, the long VHF antennae mounted on the back, wagging in the head wind. Cam checked the Blue Force Tracker, the only way for anyone to locate them in distress, and initiated a communications check with the compound. Leo nodded his head, pleased with the routine and his team. They had driven through most of Kabul over the last several months, but never this far out where medieval urban sprawl gave way to industrial compounds, gaping sand, and rock mining pits. Ahead of them, the foothills loomed in the distance, and beyond, the still snow-capped peaks of Laghman Kabul. Somewhere in the defilade was Faisal Rahman, a critical asset who had gone dark on them in the last sixteen days.

“Dog fighting had seen a resurgence in popularity after the Taliban were driven from Kabul by the Americans and Northern Alliance in 2002. Since then, the gambling networks, dog trainers, and fighting cabals had grown on a massive scale. Fights were held monthly on the city outskirts where crowds could gather unencumbered by outside influences like the Afghan National Police or Taliban decrees on the sin of gambling. Although women weren’t permitted unless they served to care for the men or loose children, the attendance and fight numbers swelled like a bloated carcass. The team followed a procession of private vehicles and several Jingha trucks packed with men down the highway past crumbling compound walls half-buried in shifting dunes. Beyond, as the highway rose to crest the first wave of foothills, the landscape became more barren and the wind swirled red sand columns across the asphalt.”

Talk about feeling like you’re really there! The endorsements on the book’s back cover, many by those in the military, testify to how accurate Coussens’ descriptions are both to the setting and to the processes the military uses. In fact, it wouldn’t be going too far to say Coussens writes like Tom Clancy, given his attention to detail as well as his ability to create suspense.

Personally, as strong as the scenes in Afghanistan are, what I most appreciated was the internal conflict Damien feels. This is a man who deeply loves his daughter and wants what is best for her, but he feels torn between his love for his family and his work-the need to protect his country and those who cannot protect themselves. Coussens hits a power-punch to the reader’s stomach when it comes to portraying the pain and angst felt by those who serve.

Consequently, the novel is hard-hitting on many levels.

Ultimately, I was left wanting more, and fortunately, I won’t be disappointed. A sequel, Relapse, is in the works and readers can get a sneak peek at it in the back pages of Failed State. This excerpt shows that the excitement for readers and the agonies for the characters are not over yet.

The History of Bookmakers

The origins of bookmaking have vanished into the past, but betting, especially on horse racing, has been ingrained in the character of England for centuries. Originally betting would have been between individuals, with the largest sums of money wagered on the Classic races, such as the Derby and the St Leger. Betting was the domain of the wealthy, but betting contracts, where no money changed hands, often led to large debts and animosity. The Gaming Act of 1845 banned this practice and bookmakers began to insist on cash up front.

Betting shops started being set up around the country but were outlawed by the 1853 Betting Act, and were not legalised until 1 May 1961, after which 10,000 were set up within 6 months, with some of the illegal bookies making it through the new vetting procedures, established by the 1960 Betting and Gaming Act. However a lot of them found that entering into the business world was outside of their capability, being unable to set up premises, pay staff and ‘go straight.’ As well as this, betting tax was increased and the Government imposed a 33 per cent tax on the fixed-odds coupons issued by bookmakers. The number of High Street shops began to decline, and now there are just over 8,000.

Punters could listen only to an audio commentary on races in the betting shops, provided by the Exchange Telegraph Company, with each region having a ‘local’ commentator with a ‘local’ accent. In 1986 the regulation relaxed and television screens were permitted which would bring live racing via satellite to the majority of shops. Bookmakers were permitted to open in the evenings and on Sundays, but duty at 10 per cent was driving punters to illegal bookmakers, who, operating in pubs, clubs and factories, accounted for a 10 per cent of betting turnover.

Another two events have had a massive impact on bookmakers – the first when Frankie Dettori rode all seven winners at Ascot in 1996, which resulted in massive payouts. The second was the introduction of the National Lottery and particularly scratchcards in 1995, with the betting shops being denied the right to sell tickets. A Government survey on gambling revealed that 57% of gamblers use the lottery, 20% buy scratchcards and 17% bet on horseracing.

However in the past decade, measures have been taken to rebalance the nation’s gambling impulses. Tax on betting-shop wagers was cut from 10% to 9% and abolished in 2002, in favour of a tax on the bookies’ gross profits. Rules regarding betting on football were relaxed, allowing bets on single matches, and betting shops have been allowed to install fixed-odds betting terminals and fruit machines.

Online gambling is today’s worry on bookmakers but the figures suggest that the world of internet gambling and betting shops could live side by side -the four biggest betting shop companies still seem strongly committed to betting shops. William Hill currently runs more than 2,250 shops; Ladbrokes has 2,350; Coral owns 1,600; and totesport manages 540. Paddy Power, which has 58 British shops, mostly in and around London, announced profits of £55.2m for 2007, half of this coming from online operations. But its UK shops also made money and it plans to have twice as many by 2011.

Ryan Watts Emini Trading Program Review

Ryan Watts E-mini Trading

I started trading index futures back in 2004. My first year trading the ES (S&P E-mini) contracts was a long year for me as I was essentially gambling and I am a terrible gambler.

Fortunately, in 2005 I stumbled upon Ryan Watts and his Scalping the E-mini Futures & Forex learning program. I can not begin to tell you what an eye-opening experience it was for me. If only this program was known to me in 2004 it would have saved $1,000’s of my hard-earned dollars.

Having personally traded using Ryan Watts’ day trading system I think I can give a fairly non-biased review. Mr. Watts is a trader first and a teacher second and he uses these techniques everyday to scalp the ES (e-mini S&P), the YM (e-mini Dow) and he also trades the foreign exchange market (Forex). What you get with the Watts Trading consists of three parts, first being the e-book with charts examples and setups, second being the progressive flow exercises, and last but definitely not least you get lifetime access to the live trading room.

* The e-book gives you a detailed look at the mechanics of his process, the steps used to prepare for each trading day, and an outline that will help you stay focused in the work of your trading. All of the tools that Ryan makes use of are shown in the e-book with detailed information on each.

* What you get with the progressive flow exercises is a detailed step by step process that you will use to progress as a trader. Traders ought to gradually progress as their skills improve and that is what these exercises are all about. You can move along at your own pace and build the confidence you require to succeed.

There’s also lots of other useful pages on the Watts Trading Group page on yahoo groups. Chart templates are provided there as well which makes things much faster when you go to setup your charts. There’s also some.pdfs that helped me tweak my charts and make minor adjustments in my order entry. There are also suggestions from fellow traders from the trading room who like to share their knowledge as well and will lend a hand, too. One document that I found particularly useful was Mr. Watts’ explanation of the stages of cost action. It was great to see the way that he views the market and what cost action is all about.

I highly recommend Watts Trading for someone who desires a nice scalping strategy whether it be for Forex or index futures.

When I first bought and starting it, I found the live trading room the very useful. Mr. Watts is trading this exact process everyday so you can see his live charts as well, which is helpful to see some real example trades. In the event you need any assistance or have questions he has always provided it and will show you what criteria to use to take trades or pass on them.

Mr. Watts will also answer any questions you have about his trading process if he is in the trading room or always by e-mail. This is what helped me recover from a funk and make serious strides as a trader. Do not expect Mr. Watts to give calls because it is not a calling room, but will go over his trades after the fact. Trading the same market as Mr. Watts and when I took the same trade as him it helped boost my confidence.

Once you learn to trust yourself and the indicators (signals), you will find trading profitably and consistently a reality.

You can get more information by going to Watts Trading.

May your next trade be profitable.