Tuesday, October 4, 2011

Edition #631

Today's Highlights:

Weekly Spotlight:

Visit GCF's Community Calendar page for a list of upcoming local events and fundraisers. Do you have a community event or fundraiser that you would like to advertise on our website? Send an e-mail to webmaster@gcfbank.com.

Our Current Rates:

For a listing of our current deposit and loan rates, click here.

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1st Flash

Face Off!

Social network giant Facebook ruffled a lot of feathers this past month by instituting changes that have frustrated a lot of users.

The changes spurred a new wave of hoax emails warning the site would no longer be free, accompanied by a peak at a tiered fee structure. Despite Facebook CEO Mark Zuckerberg's continued assurance that the site will always remain free, any structural changes provide fertile ground for such speculation. And probably some free publicity for the site as well.

If the design change alone has users upset, the next month or so will really have them in an uproar. Most of the impending "upgrades" will be phased in over time.

Perhaps the most misunderstood and controversial feature is the Timeline. What is now known as the user profile is getting a major overhaul along with its new name. A large, customizable horizontal photo will grace the top of the person's Timeline with basic information listed just below. This would be the location, current employment, marital status, etc. that already appears.

The left sidebar will display posts, photos and other events from the person's past. This is the part that has privacy nuts enraged. I use the term "nuts" because nothing new is being revealed. The information already exists on Facebook, it's merely uploaded photos and posts the user made over time, all bundled into one location. It's information they have already freely shared. The very action of doing so violates all aspects of privacy.

Yet Facebook is not blind to this issue. They've made it easy to customize privacy settings for every post to allow users to decide which information they want to share and with whom.

Timeline will be a bit complicated to configure initially. But when you do, it's possible this app may prove revolutionary. Personal photos, posts and events depicting your life will scroll right before your eyes. You'll be able to add events at any point - photos and video as well.

Timeline can serve as your personal biography. It can trace your career history, achievements, and personal interests. Add photos, videos or text of loved ones you have lost to create a memorial accessible to others who care.

Companies can display their growth history, acquisitions and earnings to potential clients. Politicians will have a hard time hiding their skeletons in this closet.

Timeline is expected to rollout within the next two to four weeks. Those of you who want to play with it now can enable it by following these directions. This will give you a chance to clean up anything you don't want viewed before it goes public.

Timeline is just one feature of Facebook's new Open Graph addition. Some of you may never leave Facebook again.

Your Likes will now pop up in a real-time ticker stream, viewable to those you've allowed access, where they'll be able to seamlessly examine those items they find of interest. It's planned to be a lightweight feed that won't annoy your friends.

Facebook wants to be your favorite video arcade. They claim to offer more games than anyone. And your friends will be alerted when you're playing so they can join the fun.

Music, movies and TV shows will stream from within the site. Create an outside services app to read your favorite news content without leaving Facebook. The Wall Street Journal was one of their first media partners on board.

You might be wondering why Facebook would institute such a major overhaul. Look no further than Google for the answer.

Google+ debuted in late June, the tech giant's entry into the social media foray. It combines the best of Facebook, FriendFeed and Twitter into one package.

Your friends are assigned to a particular Circle, each granted access to whatever content you choose. Separate friends from family or professional Circles. Rather than having to exclude those you don't want viewing your posts or photos, rights are granted to a designated Circle. You have to choose any outsiders you want to share the data. Google seamlessly addresses the privacy concerns Facebook users have been expressing from its debut.

As with Twitter, you can follow somebody that hasn't accepted you into their Circle. Learn a bit about them before deciding how much you want to share.

Google+ offers a video chat that has gotten rave reviews. They call it Hangout, and rivals even Skype. Huddle allows for group video chats.

Photos upload easier than they do to Facebook via an Android interface. Your Picassa albums are automatically integrated. And they offer enough games to keep even serious players occupied.

Sparks allows you to designate topics of interest. One click compiles all the recent new articles published on your favorite subject.

The biggest problem Google+ faces now is that it's relatively unknown. In typical Google fashion, invites to join the site were distributed sparingly at first to allow sufficient time for user feedback. The numbers quickly grew to 18 million users within the first month.

It's more popular in the tech community than with the teen set. Circles are still small, post threads pretty bare. Once Google has the product tweaked to its satisfaction, it will be declared ready for the mainstream. Then watch the punches begin to fly. It will be the heavyweight matchup of the century when Google and Facebook finally get together in the ring. Who do you think will score the TKO?

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2nd Flash

Fall Cleanup Guide

Is your computer running sluggish? Does it lack that zip it had when it was new?

One should first suspect malware. With email scams becoming commonplace, cyber crooks have gotten pretty savvy in finding new ways to lure their prey. It can be impossible for even the most security-minded individuals to avoid malware downloads.

Run a complete scan on your system to detect and eliminate any malicious programs you may have picked up.

After that, it might be a good time for a little fall cleanup. In fact, it's a good idea to perform these steps routinely, whether or not you're having issues. Spring clean your home and yard - fall clean your computer systems.

Your PC has a lot of data you will never use. Much is included as trial software when you bought your machine. You may not have even known it was there, nor do you ever intend to use it. Open your Control Panel and select Add or Remove Programs. It will take a few seconds for the list to populate. Once it does, you'll have the option to Remove any unnecessary software from your system.

Use this utility anytime you want to remove an entire program. If you merely delete it from your Programs directory, you will leave fragments of files that can possibly be used by other programs regardless if you use the alternate program or not. You'll also leave registry keys fragmented that will bog your computer down when trying to implement.

Updating programs will often leave registry fragments as well. The jury is out on whether or not cleaning your registry is beneficial. There are cases where existing entries can stall your computer or prevent a program from launching or installing. Yet, delete the wrong key and your system can be rendered useless. Tinkering with this file is best left to a professional.

Should you decide to venture on your own, use a registry cleaner from a known, legitimate source. This is prime real estate for malware downloads. Even reputable sources can have a hard time distinguishing those files you need and those you don't. Always backup your computer before cleaning your registry, and create a system restore point in case something essential gets accidentally zapped.

Each time you surf the Internet, your browser stores copies of the pages you visit in a cache along with images to load quicker the next time you visit. These files steal resources Windows could be using otherwise. Your Internet history, temporary files and cookies add more clutter to your system

Every browser offers a tool to cleanup your browsing history and cache. Look for it under the Tools menu.

Pay attention to those little boxes during software installation. They'll often ask you to install other software along with it. Software you don't really want or need. Skip the ancillary stuff.

Defragment your hard drive monthly. As you use your files, they get spread out over your hard drive to grab the first available space. Putting them back together into a single contiguous file makes it easier to access, making it quicker to load the next time you use it.

The Check Disk tool checks and repairs hard disk errors such as bad sectors, lost clusters and directory errors.

Both the Defrag and Check Disk tools can be accessed by opening Windows Explorer, right click the drive you want to check and choose Properties. Select the Tools tab to check or defrag now. Use the Scheduled Tasks utility in Control Panel to schedule a monthly test.

Once a year, shut down your system for a thorough cleaning. Remove all cables. Open the box and clean all of the dust out of there. A can of compressed air will do the trick without harming any essential elements.

Shake all of the crumbs out of your keyboard. Use a small brush to capture the pieces that hide under your keys. I'm sure I'm not the only person who eats lunch with one hand while typing with the other.

Never spray solvent directly on your computer screen. LCD and flat panel monitors are extremely fragile, be very gentle to avoid damage. While disconnected from the rest of your system, use an anti-static cloth to gently wipe away any surface dust. Next, moisten a cloth with a solution of equal parts white vinegar and distilled water. Tap water can leave white marks on your screen. Gently move the wet cloth in just one direction, top to bottom is preferred.

For a laptop, set the background to black and hide all the desktop icons. Minimize any open windows. This helps you more easily see the dirty areas to target.

Technology is great when it works, a real stress inducer when it doesn't. These easy steps should help keep your system running at peak levels. And give you one less thing to stress about.

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Financial News

The Fed is Doing "The Twist"

If you have visions of Ben Bernanke on the dance floor performing unnatural muscular body movements, you will be disappointed. I am referring to neither a dance, nor song, nor party game. "The Twist," when discussed in current economic circles, refers to an intentional restructuring of the Federal Reserve's Balance sheet. Specifically, the Fed would like to lower long term interest rates in hopes it will have some positive effect on the absolutely dismal U.S. housing market. Although U.S. mortgage rates are already near historic lows, there are those at the Fed who believe that even lower rates will help stimulate demand for housing. Fed Chairman Ben Bernanke is one of them, and has implemented a little used Fed policy tool known as "The Twist." The last time this policy tool was employed, President Kennedy was in office. It was his administration who dubbed the action by that name.

So what exactly is The Twist? First a little background. The Fed's normal modus of operandi is to control the money supply, and hence short term interest rates, by buying and selling short term securities. This has the effect of increasing or decreasing the money supply. Banks directly, and the rest of the marketplace indirectly, are generally "stuck" with the rate environment dictated by the Fed. Why does the Fed want to manipulate interest rates? It is in keeping with its Congressionally legislated dual mandate: Promote maximum employment while maintaining price stability. Tall order, and sometimes not in congruence.

Back to The Twist: So while the Fed controls, to a large extent, short term interest rates, long term rates are allowed to float as a function of the market. Currently, long term rates, despite their very low "nominal" level, contain a fairly large duration premium. Stated differently, long term rates are abnormally high when compared to the overall level of interest rates. This creates what economists refer to as a "steep yield curve." So despite historically low mortgage rates, if the yield curve were less steep (flatter), mortgage rates would be lower. And this, Bernanke and his colleagues believe, would help the housing market. Functionally, in order to execute The Twist, the Fed must begin selling a portion of its massive store of short term securities and replace them by buying long term securities. The extra demand (created by the Fed) for long term securities should cause the price to rise, thus lowering yields (remember, bond prices and yields are inversely correlated).

Will it work? Maybe. Maybe not. The assumption is that there is a lot of pent up mortgage demand that is price sensitive. Some dispute that contention. There are also other risks, such as the selling of the short term securities by the Fed could cause those prices to fall and short term yields to rise. This could raise the cost of other non-housing related short term credit, hence dampening the economy further. Even if the Twist is successful, the maneuver will pinch bank margins and negatively impact bank earnings at a time when the banking system continues to absorb HUGE mortgage related losses. More banks could fail. My opinion is the Fed faces strong headwinds in this endeavor, having already taken monetary accommodation to unprecedented heights. All this while fighting against incredibly inept fiscal policy, of which may be impossible to entirely offset.

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PURPOSE:

GCFlash is a weekly e-mail sent only to its listed customers and associates free of charge. GCFlash informs customers of special product offerings which may be of interest, current interest rates on both deposit and loan products, selected financial news and other financial tidbits. GCFlash is intended to supplement the more comprehensive information listed on the GCF Web site at http://www.gcfbank.com.

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