I think I do a pretty good job of keeping politics out of my posts here at Personal Finance Analyst.  Occasionally, I slip a bit and provide some clues regarding my personal outlook, but I really do try to keep my posts out of the nasty and generally ineffectual back-and-forths that too often pass for blog-based political debate.

I’m going to try to maintain that with this post, although the subject matter makes it tough to remain “above the fray” or non-partisan.

Here’s the deal.  President Obama and a Democratically-controlled Congress ran, at least in part, on the idea that it was time to pump some bucks into the economy in hopes of staving off a deeper and nastier recession.  Since his election, Presiden Obama has signed into law provisions creating more spending than anyone can truly comprehend as means of turning the economy around.

The economy isn’t turning around.  The stimulus doesn’t appear to be stimulating.  After reading a recent Associated Press article about the White House’s approach to the not-so-stimulating stimulus, I thought people might be interested in trying to figure out why it isn’t doing the trick.

Instead of giving you my personal take on why this is happening, I thought it might be nice to share a few possibilities.

It needs more time. Only a fraction of the money planned for stimulus spending has been pumped into the economy at this point and some supporters of the stimulus package will tell you that it will start working once the circulation of the cash begins to grow.  More of that money is supposed to be in action this summer, so if you take this position, you’re probably expecting progress soon.

It could be worse. You don’t hear this a lot, but I think that it might be fairly persuasive.  It’s possible that the stimulus hasn’t pulled us out of recession but that things would be a heckuva lot worse if we hadn’t done anything at all.  The President sort of hinted at that when he recently stated:

“Now, I know that there’s some who, despite all evidence to the contrary, still don’t believe in the necessity and promise of this recovery act.”

“And I would suggest to them that they talk to the companies who, because of this plan, scrapped the idea of laying off employees and, in fact, decided to hire employees. Tell that to the Americans who received that unexpected call saying, ‘Come back to work.’”

Rose-colored glasses have limited the stimulation. This seems to be a developing theme among those who are speaking on behalf of the stimulus package and the White House.  Basically, they’re telling us that the original plan was created based on estimates that were later shown to be a little too optimistic.  That’s why we’re not back down to 8% unemployment and it’s why the economic graphs aren’t yet showing an up-tick.  The apparent solution to this error in estimation would be a little patience and/or more stimulus spending.

It’s not going to work.  Period. While the other explanations assume that the core thinking behind the stimulus package is sound, maniy will argue that it was doomed from square one and that the programs and spending aren’t going to do solve any economic problems but will instead exacerbate them.  As you’d probably expect, most of these arguments seem to be coming from free marketeers and the loyal GOP opposition.  The fact that they’re biased doesn’t mean they’re not potentially right (that holds true for the previously mentioned takes, too).

So, if you’re trying to figure out why you’re wallet isn’t being stimulated and are questioning the whole shebang, you can take your pick from those explanations.  Regardless of which one(s) you choose, the fact of the matter is that things aren’t yet looking up.  Until they do, it behooves all of us to do our part to back the approaches we feel offer the greatest chance for success and to do our best to keep our own financial houses in order throughout this downturn.

I know I promised to try to keep my politics out of this, but I don’t want to be accused of surreptitiously spinning the issues here.  So, I’ll come right out with it.  While my vote is always in play, I vote with the Democrats more often than with the Republicans.  I voted for Barack Obama and would do so again against the same competition.  That being said, I am not convinced of the stimulus package’s wisdom and an unimpressed with the unwillingness of Americans to accept the temporary pain of market adjustments.  I’m hoping I’m wrong, though.  I’m hoping that we’ll start to see and feel that stimulus package kicking in soon.  Misplaced or not, I always hope for the best after something’s been done, even if it’s not what I would’ve done.

Keep your fingers crossed.

Zecco, which is a phonetic representation of the acrononym ZCO (zero commission cost), is an online trading platform that’s been around since 2006.  The company has managed to weather a nasty economy and the related drop in small investor market participation by making a few adjustments to its approach.

Here’s a brief overview of Zecco and what it’s all about.  If you’re looking for a place to buy and sell without broker assistance or huge costs, it might be a good option for you.

Zecco’s Legitimacy

Before you start signing up to invest your money with anyone, you should ascertain their legitimacy.  Zecco appears to be a legitimate, legal entity.  In addition to the their 3-year track record and a large number of happy customers, Zecco is a subsidiary of Equinox Securities.  According to Bargaineering:

Equinox Securities (CRD# 135398, SEC# 8-66916) registered as a corporation in California on 01/21/2005 and is located in Ontario, CA. It’s currently not suspended by any regulator and has not yet had any Arbitration Awards, Disciplinary and/or Regulatory Events. I downloaded the full Equinox Securities Report and you can see Zecco Trading listed on page 4.

CashMoneyLife gives us some additional reasons to feel confident about Zecco:

Zecco is a member of Financial Industry Regulatory Authority (FINRA), which is the largest non-governmental regulator for all securities firms doing business in the United States. Zecco is covered by the Securities Investor Protection Corporation (SIPC), which is an organization that acts as insurance against your broker filing for bankruptcy or otherwise going under.

Basic Structure

Finding that we should doubt the premise that Zecco might be a phony scheme operated out of low-rent motels by recent parolees is great, but being legit is only part of what makes an investment platform attractive.  The actual structure and standards for participation are pretty darn important, too.

Accounts at Zecco are free and there isn’t a minimum deposit requirement.  It takes just a few minutes to get things set up.

Right now, Zecco is charging $4.50 per trade.  If you maintain a balance in excess of $25,000 and make at least 25 trades per month, you qualify for ten free trades.  Options contracts cost an addition fifty cents.

$4.50 trades aren’t a horrific deal, but for Zecco veterans they may seem a little expensive.  That’s because the company was offering freebies to folks with balances of only $2,500 and it doesn’t appear as if there was a 25-trade requirement at that time.  The changing nature of the economy and overall decreases in stock market participation led Zecco to change their policy.  Keep that in mind when reading Zecco reviews–many of them were written before this policy change.

Overall, though, $4.50 per trade is a decent deal and the right combination of extras could make Zecco one of the best trading options available.  So, let’s look for some nice extras…

Zecco Extras

Let’s start with the Zecco Zirens.  Zecco went out and hired a handful of spokesmodels/actresses to record a series of trading instruction videos.  They named this crew the Zecco Zirens.  The videos themselves do contain some valuable information and can be really handy for newbie investors.

The cheese factor, however, is high.  I really can’t imagine that this approach is doing much to increase Zecco’s perceived legitimacy or seriousness.  If you need an attractive teacher in a little black dress to teach you about an option call, however, Zecco has that covered.   The photo accompanying this post features one of the ZZ’s.

Zecco also has a very active member community.  If you want your investment with a heavy dose of Web 2.0 interaction, it’s a pretty good choice.  The forums are hopping and Zecco makes it easy for folks to make contact and to discuss matters amongst themselves.

If you’re looking a place to manage your trades, Zecco seems like a pretty reasonable option.  They’re legit, they have a solid basic structure and at least some of their added options have real value.

Fidelity Investments surveyed over 1,000 millionaires to see how those perched toward the top of the economic ladder are feeling these days.  Nearly half of them said they didn’t feel wealthy.

It’s true, the millionaire crowd has taken a massive whipping in the marketplace.  The stock market nosedive and all of the associated bad economic news has taken a toll on their investment holdings.  It’s never fun to lose money, even when you have some of it.  It’s probably more than a little frustrating to see your portfolio shrink faster than a 400-pounder on The Biggest Loser.

And while some of the dissatisfaction expressed by 46% of the millionaires may have been an attempt not to rub others’ noses in their cash heaps when times are tough, the resounding message coming out of the Fidelity survey could be expressed like this:  46% of millionaires have absolutely no sense of perspective.

Unemployment is around 9%.  Although we’ve slowed the slide toward economic armeggedon and will undoubtedly survive this downturn, things aren’t going to get better tomorrow.  Life is tough out there for many, many people.  It was tough before the downturn for many, many others, too.  While the millionaires are bummed about losing money, they should try to remember that they were fairly lucky to have some money to lose in the first place.

People have lost their homes.  There are over 100,000 people in chronic homeless nationwide–and that’s just “chronic” status, who knows how many people are temporarily in trouble right now?

While millionaires lament the status of their portfolio and the drop in their home’s value over a slightly smaller cut of Kobe beef, someone out there is sucking ketchup packages in the rain.  While the millionaires don’t “feel” wealthy, some kid is not feeling well because of malnutrition.  Who do you think is better-positioned to come out of this downturn in good shape?  I’m thinking the millionaires are.

Forgive me if I don’t weep a crocodile tear for the dissatisfied millionaires of America.

Don’t get me wrong. This isn’t some kind of crazed “eat the rich” populist rant.  I don’t dislike the rich because they have things.  I understand the role those with greater wealth play in the well-being of the overall economy.  I know that they’re people, too, and I want them to be happy.

HOWEVER…  Anyone who can look out over the economic landscape right now with a net worth in the millions and feel anything less than wealthy just doesn’t get it.  Hey, 46%ers, it’s time to recalibrate your perspective!  Maybe you shouldn’t “feel rich”.  Perhaps, instead, you should feel “wildly rich and much, much better off than so many other people that I thank my lucky stars fifty times per day”.

According to Fidelity’s survey:

Asked what made them feel wealthy, most said to “live within means with little or no debt and with spending under control.”

Here’s a solution, based on that response, for the sad millionaires among us.  Spend less and adjust your idea of what “living within means” really means.  That’s what everyone else has been doing for the last year or two.  Welcome to the party.

Let’s get things moving.  A better economy.  Let’s eradicate poverty to the extent possible.  If we can do that in a way that allows millionaires a little more breathing room, so be it.  I’m not just on the side of the poor.  I’m on everyone’s side–even the Thurston Howells of the world.

In the meantime, if you’re toting a net worth of a million dollars or more, develop some perspective.  You might not feel wealthy but you are.  If you’re not sure, ask someone who’s gone from a working class home to a homeless shelter.  Ask a few of the half million people who lost their jobs last month how you’re doing.  I’m sure they’ll let you know.

So, we’re in a recession.  We’ve been in recessions before.  We know what a recession is, definitionally, but that doesn’t really give us any idea of why we have them.  What are the causes of economic recession?

Quite frankly, the answer to that question will depend upon who you ask!

David Cornish blames unrestrained capitalism and exessive greed.

Gaynor Borade sees a link between oil price spikes and the onset of recession.

Tejvan Pettinger argues that tight fiscal policy and fast, unsustainable growth have both led to recession in the past.

Stormy Brain explains why so many people are happy to blame the Fed for recessions.

A Washington University news article maintains that experts blame excessive consumer debt for our current economic downturn.

Love a Recession has three lists of potential causes.  The “mainstream” outlook, the authors personal opinion and other potential causes.  The range from speculation to underwhelming consumer confidence to Satan.  Take your pick, right?

Love to Know has an article with the title, “Causes of Economic Recession” that doesn’t even bother to list a single potential cause of recession.  Instead, it maintains that it’s “difficult to predict the causes of economic recession”. 

Another vote for high oil prices in this video.

How about government spending overseas, inflation and the fear of a recession.  Maybe FDR was onto something with that “the only thing we have to fear…” thing, huh?

Those crazy kids who don’t mind being associated with Lew Rockwell blame excessive government regulation.  No.  Really.

Are you getting the gist of this yet?  NO ONE REALLY KNOWS WHAT CAUSES A RECESSION.

That doesn’t stop them, however, from pretending as if they do have an answer.  Not so coincidentally, the causes they uncover are often linked to specific governmental programs of which they don’t approve on other grounds, too.  

In other words, if someone tells you that George Bush caused the recession, that someone probably doesn’t have a “W” bumper sticker.  

If someone tells you that the recession is a direct results of government policies designed to promote minority home ownership via subprime lending, you can probably guess how they’d feel about that policy even if we weren’t in a recession.

For every so many people who blame deregulation for the recession, there is at least one person out there who will take the contrarian view that regulation caused it.  

As far as I’m concerned, you can spin the wheel and embrace whichever pet “cause” it stops on, because your causal analysis isn’t going to amount to a hill of beans anyway.  

The more important consideration at the moment is the fact that we’re in a recession and we might wanna think about how to get out of it before too many more people end up losing their jobs and/or homes.

Which is why I’m proposing the Big Omnibus Recession Elimination Solution (BORES).  Basically, it boils down to developing alternate energy sources to reduce the price of foreign oil and our exposure to price spikes while we engage in less restrictive monetary policy and encourage increased consumer spending (but not debt).  We do this while cutting foreign aid to our allies and banning speculative stock trading.  We’ll deregulate all business by drafting better regulations that will make us more recession-resistant, even though we’ll recognize the inevitability of recessions as part of the business cycle.  Oh, we also need to find a way to defeat Satan.

That’s BORES.  And that’s what you end up with if you start believing the various single (or even “one or two”) issue explanations of the underlying causes of economic recession.

Most of us aren’t particularly keen on recessions.  We tend to thing of them as negative events, the kinds of things with which we’d rather not deal.  Sure, the repo men are loving the downturn, but everyone else seems to be suffering–or at the risk of suffering.  

The idea of examining the benefits of a recession seems a lot like marveling at the great clown performances John Waye Gacy turned in at various children’s parties, in a way.  No matter how many kids he made giggle, it couldn’t possibly make up for the corpses in the crawlspace.  So it is with a recession.  On-balance, it’s such bad news for so many people that it feels a little unsavory to talk about the upside.  There is, however, a real potential set of advantages to be gleaned from this current economic mess and we should recognize them before we become completely convinced that the we’re approaching some kind of Apocolypse.  

First, if you’re relatively insulated from the economic downturn and have sufficient security to make purchases and/or investments with some element of risk, there are real bargains to be had out there.  The stock market features a slew of undervalued issues (no, I’m not going to provide specific stock tips here) and houses are cheap at the moment.  If you’ve got a little room in your finances or have a great credit score, you might want to go shopping.

Second, the Fed’s efforts at staving off a recession have largely consisted of pushing down interest rates.  So, if you fall into the aforementioned group, you’re going to see lower price tags on major purchases and lower price tags on the money you’ll borrow to make them.  Between these two factors, you can get a whole lotta house on the cheap these days.  Just in case, though, buy something you plan on living in, okay?

Third, there’s a big picture reason to at least partially embrace the recession.  It’s going to clean house.  It will force businesses to become more efficient and will reward creativity and quality while punishing the fat and lazy.  In the U.S., everyone claims to love a free market until they see this part of the cycle.  It’s necessary, though.  It prunes out those who made poor decisions and creates openings for smarter, leaner businesses.

Fourth, sticking with the big picture theme, a recession creates an impetus to evaluate the way we’ve been doing things as a nation.  Sometimes, you can actually learn a lesson or two from the consequences of your bad behavior and this could be such a situation.  Maybe it’s not bad for us to come to grips with the fact that credit overuse/overextension and a pollyannish belief in perpetual growth weren’t the best ways to run our financial houses.  

Fifth, if you take it down to the personal level, this economic downturn can be viewed as an opportunity for a little personal development.  Even if that isn’t really part of the benefits of a recession, it is an opportunity to do something worthwhile.  Look at these lists.  Some of the alleged “benefits” aren’t too impressive, but others do offer some potetial to come out of this mess a better and smarter person than the one who entered it.

I’m sure there will be those who disagree, but I happen to think that periodic contractions of the economy are natural parts of a cycle of growth and correction.  I think that they’re inevitable when you are talking about an economy that retains at least some traits of a true market system.  When things go up, we overshoot and come back to the “right” place.  When things go down, we overshoot in the opposite direction before bouncing back.  

This recession isn’t a good thing by any stretch, but there is some good in it.  You just have to look carefully to find it.

We’re going to be discussing the recession and what it means to us as individuals and a society over the next several days.  It seemed like the best way to kick off this conversation was by positing the titular question and getting a grip on what this whole economic downturn thing really means in terms of actual impacts.

Here we are, stuck right in the midst of a recession.  Now what?  What happens during a recession, really?  Understanding the various definitions of the term “recession” (and I think we’re meeting all of them these days) let’s us know where we are, but it doesn’t really help to explain what’s going to happen to us on a real level.  The link between reductions in the GDP and what’s happening in your neck of the woods (or on TV for that matter) isn’t allows easy to spot.

Here’s a quick rundown of some of the things that happen during recessions.  

First, unemployment increases.  This is probably the most obvious impact of a prolonged economic downturn.  In recessions, we’re producing less.  That reduced output requires less labor.  Recessions also tend to put people into a “savings mode” where they spend less, reducing demand for products, which further decreases the need for workers.  Companies struggling to stay profitable and/or afloat will also look at payroll cuts in the form of layoffs or firings as one way to decrease their expenditures.  It’s a nasty little circle, with which negative consequence feeding another.  

Second, the stock market takes a dive.  It’s not hard to figure out why that happens, is it?  Companies are selling less and making less money.  That doesn’t make their stock an attractive investment.  Worries about job and income stability encourage people to become more conservative with their money.  They save instead of purchasing stock or making other, higher-risk investments.  It’s another ugly loop.  People invest less, which drives the market down.  People see the market going down and become even less likely to invest.  

Third, interest rates sink.  The Fed tries to abbreviate the downturn by making capital more readily available to those who could use it to make purchases and longer-term investments.  The hope is that the lower rates will encourage the kind of spending that might begin to right the lilting economic ship.

Fourth, people go absolutely nuts.  During a recession, one may wonder if the doors to a million asylums were kicked open or if some enemy of the state dumped some mind-altering substance into the drinking water.  

Politicians seem to manifest the symptoms of recession looniness first.  They use the downturn as an excuse to pont the finger at rivals for power.  They leverage fear and concern to support their own agendas.  They take bizarre positions on the farthest ends of both political poles.  

The craziness extends to the rest of the population.  Encouraged by media personalities and the above-referenced politicos who have a twisted need to whip people into a frenzy, millions begin to quickly smell conspiracy and develop a thirst for the blood of anyone they can even link remotely to the overall state of the economy.

 Throughout the whirlwind of rants, polemics and fabrications, no one seems to take even a modicum of personal responsibility for the situation.

Okay, the last one is my take on the situation.  The first three, on the other hand are accepted widely as results common to most recessions.

According to the folks at CNN/Money, today’s tough times call for a new take on the “rules” of financial security. Number one on the list: It’s time to re-think risk.

That’s a good hook. The recent turmoil in the markets has scared people to the point of stocking up on canned goods, so anyone who’s ready to offer a new outlook on this seemingly extinct notion of security is undoubtedly going to be playing to a full house.

Security? Now? Tell me, please!

Well, that’s what CNN/Money promises to do. They have the new recipe–with 7 secret herbs and spices–that will produce some finger lickin’ good investment results. Or do they?

I’m beginning if this new formula is anything more than a repackaging of the old one, framed within a discussion of current events to make it seem timely.

Case in point: Rule #1. Basically, they’re telling us that the days of acting like a riverboat gambler are gone, reserved solely for re-runs of Maverick on the Encore western channel. Instead, we should be approaching risk with a more conservative perspective. Here it is:

“Old thinking: If you can stomach the ups and downs that come with risk, you’ll be rewarded.
New rule: Risk isn’t about your stomach. It’s about making or missing an important goal. “

In other words, you shouldn’t risk so much that you put your future needs and goals at risk. That doesn’t sound like horrible advice at all, does it? Nope.

It also doesn’t sound much like a new rule. It sounds suspiciously like the same rule every reasonable person who has invested in the market or walked into an Atlantic City casino has always used. If you can’t lose it, don’t risk it.

You see, this isn’t a new rule. It just sounds that way because it’s set against the backdrop of a DOW that doesn’t seem hellbent on reaching the five-figure mark again any time soon.

The fact of the matter is that the risk/reward factor has always been with it and will always be with us. If you want to win big, you’re going to carry more risk than if you’re happy grinding out a lower rate of return.

The people who are reading CNN/Money aren’t staring at crushed 401(k) updates because they decided to play the market equivalent of baccarat like a drunk millionaire tourist. They were on safe side of risk/reward in the first place.

There wasn’t anything widely regarded as high-risk about having some of your money in GE or GMC. Those mutual funds were assembled carefully to mitigate massive risk. Very few of those average Janes and Joes who are now wondering what it’s going to be like sleeping on their kid’s basement futon in five years lost massive chunks of their retirement investments because they were being wild.

This “new rule” isn’t new at all. Period. The article says:

“This bear market’s lesson is that how much risk you can take is a matter of how much you can lose and still meet your basic goals.”

I’m wondering when that hasn’t been the lesson? As far as I can remember, it’s always been one of the first things everyone in the whole wide world learns about investment. Risk pays more when things work out, but you shouldn’t take on too much risk if the higher likelihood of disappointment is going to cripple you.

That’s the way it’s always been. It’s the way it will always be.

They conclude the article by recommending that readers take it a little easier on stock buys due to risk, even if that costs them a little bit. That may or may not be good advice. We’ll see. But that’s market projection; it’s not an investment rule.

I have no doubt that crazed risk-taking backfired on some regular folk. Over extension by those higher up on the financial ladder was also a problem. However, pretending that the lesson of the last several months is that people need to stop doing “insane” things like buying into middle-of-the-road mutual funds packed with consistent Fortune 500 performers is make-believe.

The new rule is the old rule. People aren’t sick to their stomachs because they behaved wildly. They played by this rule all along and still ended up on the short end of the stick. There’s something sort of ugly about implying that retirement funds were smashed because of the greed of reasonable people behaving in accordance with professional recommendations (including those of CNN/Money, I might add).

Figure this one out.

The experts keep telling us that we have to get credit thawed to everyday consumers like you and me if we’re going to pull out of this economic tailspin. We’re not going to reverse nasty trends including high unemployment rates unless we’re spending. Translation: Credit good.

Meanwhile, another team of gurus is instructing everyone to stop living on credit and to adopt a cash-based lifestyle. The best way to weather downturns is to confront them without a debt load. Translation: Credit bad.

With a lot of distinction-drawing and some headache-inducing mental gyrations, you can almost reconcile those two viewpoints. When you start thinking about the whole credit good/credit bad thing in terms of credit cards.

I think most people would agree that credit card companies aren’t the friendliest bunch. They like to smack people around with junk fees and they use “the fine print” like nobody’s business. They even have this little trick called “universal default”. If you fall behind on your Discover bill, the folks who issued your Visa might just decide to jack you around with a higher rate or a lower limit–even if you’ve paid that Visa bill religiously since the Carter Administration.

Anyway, it’s not surprising that the behavior of the credit card companies infuriated consumers. Enough people griped that it caught the ears of those in Washington. Regulation followed.

That happened in December. The Federal Reserve Board came up with a series of regs to govern the behavior of the credit card companies. The new policies put a stake in the heart of universal default, require more warning for rate changes and greater overall transparency. For better or for worse, a change is coming to the world of credit cards. It’s not coming quickly, though. The new regulations don’t kick in until 2010.

In the meantime, the credit card companies are working on making the “transition”. Depending on who you ask, that means they’re either trying to behave according to the upcoming policies or that they’re trying to wring every last penny they can from the card-carrying populace while they still have the chance.

We’re all in favor of regulation here, right? Well, maybe not.

Some might object on principle, believing that the 1996 deregulation of the industry was a good thing and that only an unfettered market can produce optimal results. Most, however, would probably agree that there’s some room for consumer protection in a business that operates from a foundation of tiny-print contracts and tricky rate alterations that even the smartest consumers can’t really track (or defend against).

Others may object to regulating the industry because it’s bound to hurt the credit card industry’s bottom line. If the creditors can’t continue to make a healthy chunk of change from junk fees and mystery rate increases, they’re going to need to do a few other things. Those options including slashing credit lines to provide greater protection, tightening standards for issuing cards in the first place and doing away with some of the super-low rate offers.

Why should that bother us? If it’s true that increased consumer spending and confidence are essential to come out of this recessionary funk, the prospect of reducing available credit doesn’t sound that good, does it?

Remember, we’re dumping billions/trillions into banks so that they can offer more credit in hopes that will get the economy cooking again. So why would we want to simultaneously give credit issuers a reason to cut back on credit lines?

Seems a little self-defeating, doesn’t it?

Not necessarily. Remember, that credit debate has two sides. The other argues that the very reason we’re in a mess right now is because of over-reliance on credit. Those folks say it’s time we stop spending money we don’t have. Only through more responsible behavior as individuals and as a nation can we hope to beat the recession. They say there’s a lesson to be learned here and that the lesson is not to worship at the altar of credit.

From this perspective, it makes perfect sense to protect people from getting kicked in the face by nefarious credit card companies even if the opportunity cost of that decision is an overall credit reduction. The value of that credit is minimal compared to the value of protecting people from nasty creditor behavior.

Federal regulations of the credit card industry might be good for consumers, but they might not be good for credit card companies.  Which means they might not turn out good for consumers.  Which means helping consumers might prolong the recession.  Then again, maybe it’s the opposite.  Getting dizzy?  Me, too.

I don’t have a horse in this race myself. I think both sides are right. I think we can probably spend our way out of this recession and turn things around for awhile. The question is whether we’ll learn a lesson from the process that allows us to eventually re-gear our economy in a sane fashion. Knowing how likely that is (read: ain’t gonna happen), I’m not going to lose any sleep over whether or not the credit card companies start slashing access to dough in the face of new regulation.

This whole freakish swirl of seeming self-defeat is exactly what happens when convenient shorter-term solutions are at odds with long-term sanity. Throw the always contentious matter of consumer protection and market sanctity into the picture and it gets even crazier.

All I can say is that, on the level of personal finance, there’s never been a better time to pay off your cards, chop them up into tiny plastic shards and walk away from them.  Credit rates aren’t headed south of potential gains from other investments any time soon and even if regs make the industry a little softer in a year, you can’t expect any favors before 2010.

All but the most sociopathic among us have been sickened by the tale of Bernie Madoff’s alleged massive Ponzi scheme since the first headlines appeared.  

Some, however, felt more ill than most.  That’s because, in large measure, Madoff’s boondoggle was affinity fraud.  He didn’t just target people, he targeted those with whom he shared the most in common, those who were the most likely to trust him.  Bernie Madoff made his money by taking advantage of those who shared his faith.

Ronald Cass of the Wall Street Journal wrote a great article explaining affinity scams, why they work, and why the Jewish population might be uniquely vulnerable to them.  Discussing such malfeasance in a general sense, he writes:

The sense of common heritage, of community, also makes it less seemly to ask hard questions. Pressing a fellow parishioner or club member for hard information is like demanding receipts from your aunt — it just doesn’t feel right. Hucksters know that, they play on it, and they count on our trust to make their confidence games work.

I think that most of us felt that Madoff’s crime was, in some way, worse because of the affinity angle.  Those of us who aren’t Jewish, however, probably didn’t feel the same sting as those Jews who saw Madoff as both a twisted scoundrel and one who was all too happy to “eat his own”.

The release of Madoff’s “customer list” or, if you prefer, “victim list”, might help at least a few of us understand a little better.  That’s because one of the over 13,000 names on the list is Sandy Koufax.

Sandy Koufax is Jewish, but his legend exceeds his faith.  His fan base includes virtually every American who’s ever taken an interest in our national pastime, baseball.  Koufax, a baseball Hall-of-Famer, is generally regarded as one of the best pitchers to ever take the mound.  He pitched for the Dodgers in Brooklyn and in Los Angeles, striking out befuddled batters en masse on both coasts and everywhere in between.

Bernie Madoff screwed Sandy Koufax and that fact hammers home just how despicable his string of unarmed robberies really was.

You could argue that the other famous names on that list, and there are many, would make that point even if Koufax wasn’t on the list.  You might be right.  There’s something special about Sandy, though, that really underlines the nastiness of the whole affair.

That’s because the name Sandy Koufax has a special meaning for Jews while being a hero to so many who’ve never stepped into a synagogue.  He is legend, he is baseball, he is talent and he is principle.  Whether the man lives up to the reputation is immaterial.  Sandy Koufax is mythology and stealing cash from a symbol of all that’s good about America is never a good idea.

Willie “Pops” Stargell could hit.  The big Pittsburgh slugger, however, was in awe of Koufax.  He compared trying to get a hit off of Sandy to trying to drink coffee with a fork.  Bob Costas said that Koufax “doesn’t defy anything, except the norm.”

He was that good.

And if you don’t believe Pops and Bob, you can ask anyone else who’s ever watched or followed the game.  People marvel at Koufax more than forty years after he experienced his greatest baseball successes.

And, you could say, he was just as Jewish as he was talented.  When his turn to pitch in the World Series fell on Yom Kippur, Koufax famously honored his faith over his profession.  He wouldn’t pitch on the holiday.  That wasn’t just an act of Judaism, it was an act of principle.  It resonated.  If there’s one thing Americans like more than a great high and tight fastball, it’s someone who’s willing to stand on principle.

Koufax has been immortalized in poetry.  An excerpt from “Sandy Koufax, Baseball’s Jewish Star” hints at his significance:

We scoured the sporting pages for the vagrant Jewish name 

that would assuage our sorrow, and we found our twinkling star. 

He was young, wild, unfettered, and he once attended the same 

Jewish community center in Brooklyn where our own children 

would spend sparkling summers during his years of gloved glory. 

Jews related to Koufax, a man who rose to glory in the very secular world of professional sports while retaining his identity.  It’s an idea that was echoed in “The Night Game” by former U.S. Poet Laureate Robert Pinsky:

Another time

I devised a left-hander

Even more gifted

Than Whitey Ford: a Dodger

People were amazed by him.

Once, when he was

young,

He refused to pitch on Yom Kippur.

In 2001, Israel’s new professional baseball league held its inaugural draft.  The first player chosen?  Sandy Koufax.  The league honored him with that ceremonial selection, reminding the senior citizen who left the game early due to arm injuries of just how important he was to the game and to Jews.

And today, we see his name again.  It’s not on a lineup card or a Hall of Fame bust, though.  It’s on a list with 13,000+ other names.  People robbed by Bernard Madoff.  He shares space with other celebrities, but for some reason knowing that Kevin Bacon or Steven Spielberg are victims doesn’t deliver the same gut punch.  Sandy Koufax has been different for decades.  He’s special to Jew and Goy alike.

A recent piece at Real Clear Politics defined this type of crime:  ”An ‘affinity fraud’ targets members of a specific group. The group can be ethnic, religious or social.”

Madoff may have targeted Jews, but the collateral damage of his attack has reached the social group of baseball fans.

And maybe, just maybe, that fact will help to extend a sense of the ugly burn accompanying affinity scams to the rest of us.

If you don’t live in Ohio, Indiana, Pennsylvania, Kentucky, West Virginia or Michigan, you might not be familiar with Huntington Bank.  

Huntington is a regional bank with more than 200 locations scattered over the above-mentioned states (and a few in neighboring areas).  Huntington does offer some services on a more national level, in addition to supplying national online retail services.  

When you add it all up, Huntington is near the 600 slot of the Fortune 1000 and is the 29th largest bank in the United States.

Huntington appears to have a strong commitment to small business lending.  A recent press release published at MarketWatch trumpets Huntington’s performance in the area of Small Business Administration lending.  According to the release:

Huntington ranked first in both loan dollar volume and number of loans among all SBA lenders in Ohio with 791 loans for a total of $73.7 million. In Indiana and Kentucky, Huntington ranked first in loan dollar volume with a total of $23.6 and $6.6 million, respectively. Huntington also ranked No. 1 for the number of SBA loans in the state of West Virginia with a total of 44 loans.

Huntington moved up from its 2007 ranking to now become 11th in the nation for number of SBA loans and 15th in the nation for total 7(a) loans, the most common type of loan used by small businesses.

Huntington’s National Director of SBA Lending, Craigh Street, noted that the bank is “committed to helping helping business owners identify solutions so they can achieve their goals.”

That interest in small business lending is evident in some of Huntington’s outreach, too.  For instance, the bank recently issued a series of tips and recommendations to assist small business owners in dealing with medical coverage costs.

Huntington might be doing well with its business lending practices, but it’s had a little trouble with respect to mortgage lending.  Like so many U.S. banks, Huntington Bank suffered some serious blowback from the sub-prime mortgage market collapse.  

When Franklin Credit Management was getting smacked around in the meltdown, Huntington was watching carefully.  That’s because Franklin owed Huntington over a billion dollars.  During the darkest days of subprime chaos, Huntington saw its stock value drop considerably–down 13% in a single day on one occasion.

The aftermath is still being felt at Huntington today.  A Pittsburgh Tribune-Review article entitled “Stressed Banks Suspend Dividends” specifically mentioned HB as one of the institutions who are still feeling some pain in the wake of the subprime ugliness.  

According to Columnist Thomas Olson, “For instance, the parent of Huntington Bank, which has 41 branches in this region, cut its quarterly dividend in half to about 13 cents a share, on April 15.”

There’s no reason to think that this large bank is in any real trouble.  It’s one of the biggest in the country and appears to be solid and solvent.  Even so, it was unable to escape taking a few punches during tough national economic times.

In terms of Huntington’s services, they do offer a full range of banking options.  They’re part of a large bank company that’s running a series of “neighborhood” banks, as those who live in the area serviced by HB undoubtedly know.  Initial research indicates that they offer a full slate of products to their clients and that they operate a robust Internet banking system.