A woman, who I know casually, had no problem with taking on more debt because she saw herself able to handle extra payments. She reasoned, if everything remained same she could handle drain on her income. So she bought some expensive gift items on her cards and began making monthly payments.

However things never remain same and she found out rather quickly, she could not see into future very well. Her car gave out on her. The repairs exceeded value of car. She needed one for work, so she bought another one.

The new payment wiped out tiny cushion she had each month and also made it impossible to pay on her credit cards and store accounts. Today she finds herself hounded by her creditors and unable to pay them anything.

What she should have done, and what you should do, is pay off your debt while you can and not take on any more. Whatever extra you have each month should be applied towards getting out of debt in a systematic way. Until you are debt free you should order your life to make it a top priority.

Life’s pressures are more easily handled without money worries dogging you. Then when those big promotions, with those big raises come along, you will be trained to put some aside. And without debt to take care of, you can. The goods times then, truly will be good times.

Copyright 2004 www.debtattack.com

INVESTMENT STRATEGIES: In world markets, beta factors can have a major influence on investment strategies of investors. If analysis is to be believed then in times of a bull market (rising markets) investors should hold stocks with a high positive beta factor since they should outperform market. A practical example of this was in late 1990’s concerning dot com stocks. At this time bull market has reached its peak and those investors who held dot com companies (that had high positive beta factors) made excess returns and did far better than relative index performances.

However in times of bear markets (falling markets) then investors should target low beta stocks since they should outperform market. An example of this can be found in UK where two low beta FTSE stocks (Tesco and Centrica) outperformed market in a falling market.

USING BETA FACTORS IN THE PRESENT SITUATION: The current world political situation is probably worst it is for many years. World markets are falling at a rapid pace. What does beta factor analysis teach us about an investment strategy in this situation? Firstly, however good a company is it likely that in such circumstances most will encounter falls in their share prices.

However during this time a number of alternative investments that have negative beta factors have appreciated in value. The prime example of this is gold. Over past twenty years when there was a strong equity bull market, price of gold has fallen significantly. In addition to this shares in gold sector have performed badly when compared to equities. However in past few years it is noticeable that in political uncertainty that has arisen in world that price of gold has shown material gains at a time when equity markets have recorded sharp falls.

Another commodity that has done well is oil that has seen a significant increase in its price per barrel over past few months. In line with gold, oil price has suffered over most of past twenty years (at a time when equity prices were on an increase) and it is only in recent years that oil price has shown a recovery.

CONCLUSION: Beta factor analysis is a useful technique that has enabled many international investors to achieve satisfactory returns in past. If one looks at trends in world markets then one can see that in a bull market those investors that have followed a selective aggressive portfolio (i.e. including shares with beta factors of over 1 times) have generally outperformed market.

However wheel has changed. We are now in stage of a bear market. The current political uncertainty has made things extremely difficult for investors. Should they get out of world markets since a conflict will almost certainly mean falling equity prices. Or should investors move to alternative investments with negative beta factors such as gold and oil? After all in case of a conflict these commodities will almost certainly rise and will probably go against trend of equity prices. The answer will very much depend on how current political situation develops. However investors will do well if they include gold in their investment portfolios.

Disclaimer: No responsibility for loss can be accepted to any person acting or refraining from acting as a result of material in this article.

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Andy George is an accountant with years’ experience as a lecturer. Andy was financial correspondent for eight years at the Cyprus Financial Mirror where he wrote articles on business & accounting related issues to a non-technical audience.

He is the author of eBooks: How to write and Publish Your Own With a Shoestring Budget http://www.budgetebook.com New! Easy Way to Make Auto-Pilot Income http://www.budgetebook.com/cbmall