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Posts Tagged ‘loan’

Egypt’s Finance Minister: IMF Deal by this Weekend

Tuesday, November 13th, 2012

The Egyptian government will most likely sign a memorandum of understanding with the International Monetary Fund for a $4.5 billion loan before the weekend, Egypt’s Finance Minister Momtaz El-Said told reporters.

Al Ahram reports that Egypt’s government is planning to eliminate subsidies on gasoline, in line with IMF recommendations, in order to convince the IMF that it is serious about economic reform and to close the deal.

The Egyptian government needs the $4.5 billion loan to reduce its budget deficit, which stands at 11% of GDP, as well as manage a balance-of-payments deficit that has so far cost more than $20 billion in foreign reserves, since the toppling of Hosni Mubarak last year.

Government officials have proposed austerity measures, including cutting fuel subsidies, raising sales taxes on goods and services, taxing stock exchange IPOs, higher taxes on phone calls, cars, cigarettes, liquor, carbonated drinks, coffee beans and water-resistant cement.

Weatherman calling for food riots with a chance of mayhem.

Bank of Israel Restricts Mortgages Severely, Looking to Avert Future Real Estate Crises

Tuesday, October 30th, 2012

The Bank of Israel’s Supervisor of Banks David Zaken on Monday published a draft directive limiting the loan-to-value (LTV) ratio in housing loans, as of November 1, Globes reported.

The new directive stops banks from giving mortgages with an LTV of more than 70%, with an exception for first-time buyers, who are allowed mortgages of up to 75% of the value of the apartment.

Mortgage customers who buy an apartment for investment will be limited to 50% LTV. The directive will go into effect after a discussion in the Advisory Committee on Banking Matters.

The Bank of Israel announced:

“In recent years, we have seen negative developments in the housing market and the housing credit market. The draft directive has been published against the background of the marked increase in recent years in the balance of housing credit and the increase in home prices in Israel. Recent trends in the housing market indicate an increased number of transactions, an increase in the monthly level of mortgages granted and an increase in investors’ volume of activity, among other things against the background of the low interest rate environment in mortgages.

“These developments impact on the risk level inherent in the banks’ credit portfolio – the accelerated increase in the housing credit portfolio on banks’ balance sheets is liable to include risks to the stability of the banking system, primarily in light of the correlation between the housing credit portfolio and the construction and real estate credit portfolio. These represent, as of June 30, 2012, about 40 percent of total balance sheet credit risk.”

According to the Bank of Israel, many of the recent financial crises in foreign countries began with granting housing credit at terms that did not reflect the risks developing in that market.

The new directive is intended, says the Bank of Israel, to reduce the effects of a crisis in the real estate market by reducing the risk inherent in taking out a housing loan with a high loan-to-value ratio.

The Joy of Fulfilling A Mitzvah

Friday, October 5th, 2012

Rav Moshe Sofer (The Chasam Sofer), one of the greatest Gaonim in his generation, always preached and practiced charity and kindness towards his fellow man. His door was always open to the poor and to the needy for help and advice.

Once, on a cold wintry day, in the city of Pressburg, the Chasam Sofer was studying the Talmud with his two sons, when he heard an urgent knock on his door.

“It must be a poor man seeking alms,” he remarked as he opened the door. Imagine his surprise when he saw the leading member of his congregation standing at his door, looking like a beggar.

“Do not be surprised at my appearance, Rebbe,” he said, “I am in great trouble and I need your help. I would like to talk to you privately.”

Motioning to the man to enter, the Chasam Sofer told his children to leave the room while he made the merchant comfortable. “What happened to you? Why are you looking so sad?” he asked.

“A terrible misfortune has happened to me,” the man responded. “I was a very wealthy man and as you know I became a banker. But through a series of misfortunes, I lost all my money and now I am penniless. I have practically become a beggar.”

“Do not lose faith in G-d,” answered the Chasam Sofer, while pity welled up in his heart. “You still have your good name, people will remember all the charity you have given and they will surely give you a helping hand. G-d may have taken your money only temporarily to test you.

“It isn’t my money which I am worried about,” cried the banker, but about the money of others, the widows and orphans, who trusted me. It is also gone. I will have to sit in the debtor’s prison.”

“No! No!” cried the Chasam Sofer, “It will never happen that the most charitable man in the community, its leader and banker, will sit in prison.”

The Chasam Sofer began to think of ways and means to help this unfortunate man. Suddenly, his face brightened. He approached his closet, and removed a small bag of coins, which he had been saving for a dowry for his daughter.

“In this bag is a hundred gold coins,” he said. “I am giving this to you as a loan. Now, go immediately to the city of Leipzig, and the first piece of merchandise that you will see, purchase it with these gold coins. And may Hashem be with you and make you prosper.”

The banker was reluctant to accept the money. He knew that the Chasam Sofer was not a rich man and it must have taken him a long time to accumulate this money. “Rebbe,” he said, “I cannot take this money for I cannot promise to return it to you and if I lose this money too, then I will also cause you grief.”

“The help of G-d comes momentarily,” replied the Chasam Sofer, “Do you think I would give you this money if I was not certain that G-d will see to it that you make good and you will return it to me very soon. You must never lose faith and trust in G-d. Remember, go to Leipzig and the first merchandise you see be sure to purchase.”

Meets An Old Friend

The following morning the merchant banker traveled to Leipzig and entered the trading market. He wandered around until he suddenly heard a voice call him. It was a merchant friend whom he had not seen for many years.

“It must be a stroke of luck that made me meet you here,” the friend said. “Only today a boatload of coffee arrived and I haven’t the time to make arrangements to sell it. Will you take care of it for me? You can pay me in three months. Only give me a hundred coins as a binder. I know you for many years and I trust you. I’ll sell it to you for the amount it cost me as long as I don’t lose anything on the transaction.”

The banker remembered the admonition of the Chasam Sofer to enter into the first business deal he sees, so he agreed. He signed the necessary papers and have him the deposit.

For Love or Money – The Real Cost of a Wedding

Sunday, August 26th, 2012

When your child was a newborn baby, you probably thought that this moment would take forever to arrive. Think of all of the effort that you have put into your child over the years, with so many hopes and prayers that they would grow up to find a suitable spouse and one day you would proudly stand under the chuppah and watch the happy couple tie the knot.

Unfortunately, despite all of the hopes and dreams, many parents either don’t or can’t put so much effort into saving the money that goes into paying for the wedding. There could be many reasons for this. Maybe the parents didn’t think too much about it, and because the thought of a wedding always seemed so far away, they woke up too late and did not invest their money sensibly and in time. On the other hand, the parents may have tried their best to put money aside to pay for their children’s weddings, but try though they did, there was simply not enough. Perhaps their income was just not high enough, or maybe some other events happened within the family, like a sudden illness, that consumed all of their savings unexpectedly before they could be channeled into a wedding.

Unfortunately, another huge factor in this equation is peer pressure. Very often, families feel that they have to keep up with the Joneses in a big way. It becomes very important to them, for example, to hold the wedding in a certain, fancy hall. Even though the other hall down the road is large enough for their needs, “no one” gets married there because it is not quite as upmarket as the most popular hall in town, and therefore the parents feel the need to find the extra few thousand dollars that it costs to use the fancier place. And then of course, if you are using the fancy hall, then you can only take a fancy caterer, and so on and so forth.

Finding those extra dollars is not always so easy. And this is where the debt trap comes into play. As a financial adviser, I have often met families who are drowning in debt. To keep up appearances, they decide to borrow money from a loan fund. But when the time comes to pay off the debt, their financial situation has not suddenly improved. In fact, the additional expenses of the wedding have gobbled up most of their resources, and there is nothing left to pay back. So guess what happens? They go to another loan fund to obtain money to pay off the first debt … and so on and so forth until this unfortunate family falls even more deeply into a financial black hole.

Let’s go back to the beginning of this story. If the family had been content to make a more modest wedding, with fewer trimmings, they would not only have saved several thousand dollars, but they would have also saved themselves a lot of heartache.

Marriage is not meant to be a financial free for all, and using a topflight caterer will not guarantee anyone’s future happiness.

Before you decide to drown yourself in debts from banks, gemachim, and elsewhere, take a few steps back. Think about how much you really can afford to pay before taking on the bills, and where you are going to find the money. And once you know how much money you really have at your fingertips, decide which kind of wedding you are prepared to make.

For more information on how to plan a wedding wisely, read this article at the Profile Perspectives site.

Cosigning for the Devil

Tuesday, July 3rd, 2012

http://fresnozionism.org/2012/07/cosigning-for-the-devil/

News item:

Israel sought a $1 billion IMF bridging loan for the Palestinian Authority earlier this year, but was turned down, an Israeli newspaper said Monday in a report confirmed to AFP by a senior Israeli official.

Haaretz reported that Israel’s central bank chief Stanley Fischer approached the International Monetary Fund for the money after discussing the Palestinian Authority’s financial crisis with Palestinian prime minister Salam Fayyad.

Absurd, isn’t it: Israel should take a loan to support an organization that officially considers Jews the offspring of apes and pigs and which venerates ‘heroes’ like Samir Kuntar and Dalal Mughrabi whose heroism consisted of murdering Jewish children?

I suppose I can understand the reasoning of the Israeli government: if the Palestinian Authority (PA) were to collapse, it would be replaced by Hamas or worse. Israel would lose whatever leverage it has over corrupt PA officials, and there would be an end to ‘security cooperation’ (PA people arresting or helping Israel to arrest Hamas terrorists). In the short term there would be more terrorism.

But I am not sure propping up the PA is a good long-term policy for Israel. The PLO-run PA does not differ from Hamas and more extreme elements in its ultimate goal: the elimination of Jewish sovereignty and the replacement of Israel with an Arab state. Its strategy differs — it endeavors to present a ‘moderate’ image to external observers — and perhaps it is marginally more corrupt than Hamas, but that is not to say that it is less likely to achieve its objective.

What is dangerous about the PA is that while its existence reduces the chances of a military confrontation in the near term, it facilitates the longer-term diplomatic war against Israel.

The PA enables the US president to demand that Israel stop construction in Judea, Samaria and Jerusalem and withdraw to the indefensible 1949 armistice lines. The PA manipulates UN agencies like UNESCO, which it uses to deny Jewish history.

The existence of the PA is necessary to the myth of a ‘peace process’ — the idea that somehow there can be a negotiation between Israel and the Palestinians that will result in a partition of the land which will end the conflict and cause the Arabs to accept the existence of a Jewish state.

The myth has been refuted over and over by the words of Mahmoud Abbas and other PA leaders, who insist that they will not recognize Israel as the state of the Jewish people, regardless of borders.

The PA is ‘unnatural’. It exists only because it is supported by the US, the UN, and Israel. It was created by the failed Oslo process, which was based on the aforementioned myth.

Maybe the myth, and the PA, has outlived its utility. Maybe it is time for the Palestinian Arabs to stand on their own, without subsides, without special UN agencies, departments, “special rapporteurs,” etc. Maybe they should have to accept the consequences of their multiple refusals to compromise, to accept a sovereign state when offered, and rather to insist that only the elimination of Jewish sovereignty would be acceptable to them.

Would this make them more ‘realistic’? Probably not.

Perhaps they will choose Hamas or perhaps they will descend into civil strife. It is not Israel’s responsibility to protect them from themselves, only to defend herself against aggression if that is the path they take.

As I’ve argued before, Israel should unilaterally establish a defensible eastern border. It’s been 64 years since the War of Independence, and it should be clear by now that the Arabs in general, and the Palestinian Arabs in particular, are not prepared to agree to the permanent existence of a Jewish state.

Chicago Chabad House Files for Bankruptcy to Avoid Foreclosure

Friday, June 29th, 2012

The brownstone housing the Chabad Lubavitch of the Loop, Gold Coast and Lincoln Park was to have gone on the auction block Wednesday, but the bankruptcy filing this week gave Chabad additional time to repay a bank loan, the Chicago Tribune reported.

The group has found a way to pay its debts but needed more time, Rabbi Meir Chai Benhiyoun said, according to the Tribune.

Seven years ago, Chabad sought to build a new center at Chestnut and Clark streets, on Chicago’s so-called “Gold Coast,” and used its building on North Dearborn as collateral to the bank on the $4.9 million loan.

Following the economic downturn, donations for Chabad took a hit, the bank changed its rules and the organization was unable to finance its loan on the new property.

The Chabad House has served as a residence, classroom and a place to stop for Jewish travelers on visits to Chicago.

Teaching Our Community To Fish

Thursday, June 7th, 2012

Mr. Stein (not his real name) saw his career hit a dead end three years ago when the market went sour. As a commercial real estate broker, he and his wife, Devora, then a student studying toward her degree in social work, knew something had to change quickly if they were to survive financially. Friends and family members had suggested they open their own business, but the Steins had no money to invest in the project. They had no credit and the money they borrowed from relatives went directly to day-to-day living.

That’s when they contacted the Emergency Parnossa Initiative (EPI) and the OU Job Board and began the process of transforming their lives.

“This loan has enabled us to pick up a sinking ship,” said Mrs. Stein. “We are a beautiful family with a new direction and new energy to keep trying to build our lives.”

The OU Job Board and EPI collaborate to bring financial security to members of the Jewish community through job placement, interview training, and skill-enhancing seminars and webinars. Most notable is the EPI’s Business Gemach (free loan) program, which offers matching loans, up to $25,000, to individuals who propose a viable business plan and prove their know-how at a formal presentation. Once the proposal has been accepted, EPI provides mentors who are knowledgeable in that field to help with advice and business direction.

Like the Steins’s enterprise, many of these businesses are not just surviving, they’re thriving. The Steins opened a clinic to service people with mental health issues, and their largest client currently boasts eighty nursing homes. Other loan recipients have created businesses in industries including construction, vacuum cleaners, cash machines, publishing, wigs, Judaica, clothing, gluten-free products, pizzerias, school uniform manufacturers, gymnasia, and day care services.

An EPI loan enabled Mordechai and Elisheva Rosen of Far Rockaway, New York, to pursue their dreams of opening a women’s clothing store geared toward an Orthodox clientele. As a young couple they simply didn’t have the financial ability or support to launch a business.

With sufficient capital from an EPI loan to begin their venture, the Rosens opened Fame. Two years later, the Cedarhurst, New York store has become a popular outlet for women’s apparel. “We are now able to support ourselves in a dignified manner,” said the Rosens. “It’s an amazing feeling.”

More than simply finding jobs for those out of work, EPI works to build a robust financial infrastructure within the Jewish community.

“OU President Dr. Simcha Katz told me how enamored he is with this aspect of EPI,” said Rabbi Zisha Novoseller, executive director of EPI. “These loans result in parnassah (income) for the owner and the people they hire. They are building Jewish communities with the stability they bring.”

Rabbi Novoseller, a former business executive, knows all about giving. Descended from a long line of chassidic rebbes, he says acts of kindness are in his genes. “We’re in the business of helping Jews,” he said. So when some prominent businessmen offered to fund EPI, he immediately went to work.

Sometimes, loan applicants are directed to Rabbi Novoseller from the OU Job Board, where they’ve either looked for a suitable job or been coached for a career path. Often, Michael Srulie Rosner, international director of the OU Job Board, will connect these entrepreneurs with others in the industry to give them a leg up once EPI has granted them a loan. And with EPI offices housed in the OU’s headquarters in New York, an alliance of this kind can, and does, produce vast results.

“The networking we’ve gained from the OU Job Board and Srulie in particular has been invaluable to these people,” said Rabbi Novoseller.

But it’s not only young businesspeople who request loans. Many middle-aged and older members of the work force have been facing financial adversity and are motivated to start their own companies. And with many years of business experience and a more mature way of thinking, they are prime candidates for loans, said Rabbi Novoseller.

In the nearly three years since the gemach’s inception, EPI has awarded 77 loans, which are backed by guarantors. Only one beneficiary has defaulted on a loan, and in total they provide employment for more than 300 individuals. A few companies have already surpassed one million dollars in sales. Being associated with EPI has also opened doors for people who need to demonstrate that someone has faith in them and their business model. After a new company receives a gemach loan from EPI, family and friends are often more forthcoming with further loans needed to grow the business.

Printed from: http://www.jewishpress.com/sections/features/feautures-on-jewish-world/teaching-our-community-to-fish/2012/06/07/

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