“A thing long expected takes the form of the unexpected when at last it comes.”- Mark Twain. Hardly a day goes by when I don’t pick up a paper or watch the news and hear another journalist or economic prognosticator ratcheting on about the looming threat of inflation. I half expect to see people lined up outside the local Home Depot, clamoring for their wheelbarrows to carry their unwanted cash to the bank, much like the days of the Weimar Republic in Germany in the 1920s.

But as we are reminded by Mark Twain, the expected does not always occur. So let me offer a possible alternative in the form of inflation’s ugly cousin – deflation – and how that might affect commercial real estate in the not-so-distant future.

As those who followed the late economist Milton Friedman will attest, inflation is and always will be a monetary phenomenon: Too much money chasing too few goods, causing a general rise in the level of prices of goods and services.

The key word here is chasing. In real estate this means higher cost for material and labor which translates into higher building costs and ultimately higher rents. To combat inflation, central banks fight back with higher interest rates equating to higher borrowing cost to builders and owners.

The most frequent cause of inflation is the soaring deficit our government is running and the resulting massive expansion of the money supply. Under normal times this certainly would sound the inflation alarm, but in a period of de-leveraging like the one we are in today, the velocity of money is much more important than the amount of money. Too much money is just too much money when it is not moving through the system.

Consider the Japanese economy, where the mounting debt is equal to 170 percent of GDP, the largest among developed nations and almost twice that of the United States. They have been battling deflation for decades with interest rates near zero. Their stimulus efforts went to prop up “zombie banks” and did not allow the market to establish a clearing price for the collateralized assets. The net effect has been a prolonged period of reduced demand and lower prices for most assets – including real estate.

Back in the States, where our stimulus is not getting outside the banks to allow for new loans that fuel demand, it is unlikely that the velocity of domestic funds will increase anytime soon.

Changed spending habits fuel deflation

Consider the current U.S. economy where consumer spending accounts for nearly two-thirds of our economic output. With real wages in decline, excess capacity in the labor market, a contraction of available credit to consumers and a potential secular shift in spending habits among consumers – the savings rate for U.S. households has risen from nothing to more than 5 percent of income in a short period of time – it is doubtful that we will be able to rely on the Jones’ consumption patterns to stoke the economic engine sufficiently to produce inflation. When a cyclical recovery does occur, it is likely to be sluggish for quite some time.

This leads us to another assumption that foreign borrowers will no longer be willing to finance our deficits and will begin to diversify their foreign exchange reserves driving down the value of the dollar creating higher prices in commodities (most commodities are priced in US dollars) and other goods. The largest foreign holder of US Treasuries is China, where the economy is heavily dependent on exports to the US (less than 8% of the Chinese population has any discretionary income). It is improbable to assume that the Central Bank of China will not continue to support its own economy by continuing to purchase US dollars and thus make their goods more affordable to the US shopper.

So before we slip into a boring narrative on macro economics lets bring this back to the topic on hand and how deflation, rather than inflation, might be the peril we need to be watchful of and how that will affect commercial real estate in the near future. How will that affect commercial real estate in the near future? We have already seen a general decline in rents across all commercial property types by as much as 50 percent in some sectors. The cost of building continues to decline, although at a much more subdued rate, but without available credit, it is improbable that there will be enough demand to spur new development. Although the economy is stabilizing, there is unlikely to be a sustainable force of consumption to maintain historical growth rates.

With adversity comes opportunity. Investors who have over-leveraged will discover that risk does not pay during deflationary periods and cash becomes king. Opportunities will continue to arise as the calamity unravels and a new generation of capital flows into the market. This, of course, will take years to play out and good sound counsel will again be at a premium.

Mike Eyer is an advisor with Sperry Van Ness / The Group Commercial in Fort Collins, CO. He can be reached at mike.eyer@svn.com or follow his blog at http://mikeeyer.blogspot.com

If you are thinking of buying your own home, you will hear the words title insurance somewhere along the process. Many consumers are not exactly sure what this is.

For the most part, title insurance is almost always required by the lender. This insurance is used to protect the lender against loss resulting from legal claims by others against your new home. In some states, lawyers will offer title insurance as a portion of their services in examining the home’s title and providing a title opinion as to whether it is clear or not. The attorney’s fee may include the title insurance premium or in some cases it may not. In other states, a title insurance company or title agent directly provides the title insurance.

It is important for consumers to understand that the lender’s title insurance policy does not protect the consumer. The same is true with the prior owner’s policy; it does not protect you. When you need to protect yourself against claims by others against your new home, you will need what it is called an owner’s policy. The truth is should a claim occur, it can be financially devastating to the homeowner who is uninsured.

It is good to keep in mind that if you buy an owner’s policy, it is much less expensive if you buy it at the same time and with the same insurer as the lender’s policy.

Consumers should also know that the home seller may not require, as a condition of the sale, for you to purchase title insurance from any particular title company. The mortgage lender will, however, require that the title insurance is from a company that is acceptable and reliable. As the homebuyer, you can choose a company that meets the lender’s standards.

Generally speaking, a few weeks before the closing of the escrow, the title insurance company will issue what is called a “Commitment to Insure” or preliminary report or “binder” containing a summary of any defects in the title which have been identified during the title search. There may also be listed any exceptions from the title insurance policy’s coverage. The commitment to insure is sent to the mortgage lender for use until the title insurance policy is issued at or after the closing.

If you wish, you may have a copy sent to you or to your lawyer, so that you can examine it and object if need be to the contents.

Consumers should compare rates between different title insurance companies. This can result in big savings. Make sure you ask about the services and limitations under each policy so that you can decide whether coverage purchased at a higher rate may be better for your needs.

In many states, title insurance premium rates are dictated by the state and those rates may not be negotiable. If you are buying a home which has changed hands within the last several years, ask your title company about a “reissue rate.” This can be much less expensive.

When purchasing a brand new home, make sure that your title insurance covers claims by contractors. These claims are known as “mechanics’ liens”.

Mortgage lenders or title insurance companies will very often want a survey done in order to mark the boundaries of the property. A survey is simply a drawing of the property that details the perimeter boundaries and marks the location of the home and any other improvements that might be on the land.

You might be able to save some money if a past survey is available and no changes have been made to the property in the interim. You should check with your lender or title insurance company on whether an updated survey will be acceptable.

Bearing in mind, that risk itself is similar to taking a journey towards a target you are not sure to reach safely, it is fair to assume that the less knowledge we have about a particular thing we wish to engage in, the greater the uncertainty we will face.

To get the odds in our favour to reach our goal successfully, we need to study the following four points first.

1.What could be a possible cause of derailment of our proposed investment.

2.What are the things that could stand in the way of reaching a successful outcome.

3.What are the valid arguments for, and against, the probability of success or failure.

4.What is the extent of our awareness of the risk we are taking, or are we making a decision under partial ignorance.

Applying these tests before making a decision is important. Since it not easy to know the answers to all the questions, many people do not bother and tend to be guided by their intuition.

To play the forex market by intuition, to back horses by intuition, to play in casinos by intuition, all this of course, is a formula for disaster.

If the more information we have about what we need to know provides a greater chance of success, then we must make it our business to get it. Knowledge and information are the odds you need in your favour. Whatever the investment, it is not prudent to make a decision under ignorance. If you cannot accumulate enough information about the investment you want to make, stay away from that deal and wait for another.

Of course, there are different types of investments, and therefore information and knowledge has to be pertinent to the particular investment.

If we are talking about horses racing, we would need to know about the state of the going, meaning does the horse like soft ground, or hard ground, does it run better on a left hand turn track or a right hand turn track, what distance is it best at, what draw has it got, who is the jockey, what opposition is it running against etc.

When we are talking about a football game, there are equally a series of questions that have to be answered. Are all the star players in the team, are they playing at home,against whom are they playing, and so forth.

Playing the markets is a game based on a great deal of skill, but sometimes there are certain conditions which demand extreme caution, because any amount of skill can be derailed by events not always available for consideration in good time.

Currency markets are vulnerable to a large number of factors which must be taken into account, especially when volatile conditions are present.

One can either study the particular field, or be guided by experts and consultants who like some doctors, can be good, or extra good, but it is still better to take their advice than to do it alone. Of course if you only have a small cold, there is probably no need for a doctor. In the case of a major illness, you turn to the doctor. By the same ruling, if you invest very small money, you tend to use your own brains, but when playing in hundreds of thousands, it is prudent to seek the best help one can get, or certainly gather a great deal of knowledge and information before making a move.

By careful process in gathering as many odds in your favour before firing, you will find that things will turn out more profitable, and certainly less risky.

Precaution is an enemy of risk. Everybody knows that it is wise to take precaution, but not all take it. The few that do all they can, are wealthier and healthier, than the many who tend not to bother.

Professional indemnity is a kind of insurance policy that provides an essential financial protection cover to a wide variety of professionals and advisors, working in different industries. The insurance cover is effective when a client suffers any kind of financial loss as a result of an error, omission or negligence during the course of the services offered by a professional. No professional can eliminate risks or damages from his/her professional life. Therefore, it is important to seek an effective protection that can protect your interests in those uncertain times. Also, if you ever have to face any claim by a discontented client, you can get adequate compensation for the same.

No wonder, having a good professional indemnity is a must have insurance policy for every practicing professional. Anyone from accountants, brokers, computer professionals, architects, engineers, solicitors, bankers, copywriters, contractors, managers, social workers to forensic consultants should have professional indemnity to avoid any embarrassing situation that may come into their professional career. Without having a good insurance policies, professionals live with a fear of being exposed to situations that may prove a catastrophe for their careers.

Anyone making a living by selling his/her knowledge, skill or offering some other kind of services professionally is considered as an expert by the clients. Therefore, any specific opinion or an advice is viewed as valuable in the concerned industries. However, with the increasing transparency and consumer awareness, people do not feel hesitant to file a lawsuit against a professional if anything goes wrong. If they don’t find services at the desired level, they can always sue you and ask for the compensation for the loss caused to them. Therefore, it is better to seek an effective insurance cover that saves you when you are in serious financial trouble. Besides offering you the adequate compensation, you will also get legal fees as well.

With the growing importance and the impact of mobile phones in our lives, it has also become important to safeguard them. Due to their compact size and portability, they are very vulnerable to theft or loss due to misplacement. It is also very expensive to replace a lost or damaged handset which could go up to £ 500, particularly if  one is using a smart-phone or a high-end product. The only logical thing that can possibly replace a lost phone is mobile phone insurance which is gradually becoming very popular in the UK. There are a number of insurance providers who have come out with many comprehensive  phone insurance packages that ensure fast claims and easy replacement for a lost handset.  

Insuring your phone is particularly important if one is using a phone on contract. This is because the phone that were made available at very affordable prices are infact very expensive devices and replacing them can cost a lot. More over there is a possibility that many fraudulent calls are likely to be made from your contract phone which can really be a huge headache. Nevertheless, it is also important to insure one’s Pay as you go phones as many people save a lot of hard-earned money to buy an expensive phone and losing one can really be heart-breaking. Most insurers have policies that cover all types of handsets from the various manufacturers. Some network providers like O2, Vodafone etc. also offer their own mobile phone insurance for phones on contract.

Insuring  a phone can cost as less as £ 2 per month for most low and medium cost phones and around £ 8-£10 for advanced handsets like an iPhone. However, it is very important to find out more about the types of policies available and compare different deals. If you are indeed interested in a mobile phone insurance for your handset, then it would be important to look about the following aspects-

- All policies generally cover for the replacement of your valuable handset in the event of theft or loss. But to get the maximum out of it, look for one which will also cover for the loss due to damage by water or due to malicious and accidental damage.

- Also check out if you will be getting a temporary replacement handset during the processing time for the claims.

- Many insurers also provide policies with free cover for a few months and it can really save a bit of extra money for your premiums.

- Find out if the policy covers against loss or damage of phone while you are overseas.

- If you are using a contract phone than it will be diligent to choose a phone insurance that will take care of the bill due to fraudulent calls made from your stolen phone.

Mobile phone insurances can really rid you of unnecessary worries and anxieties by covering the replacement of your phones. For more information and comparisons one can go through different on-line sites that feature such deals. Wait no more and insure your phones today.

Without delving into the complexity of arguments for and against the President Barack Obama’s inclination to introduce the public health insurance plan or rather an alternative to the exclusively privately run health insurance in the country, the reality at hand is that without an iota of doubt Americans are passionate and hungry for an alternative that will be affordable and does not sacrifice quality.

Why are there so many opposition to this plan, which in my opinion should be given a chance since it survival will be sequel to its successes? Those who argue against the plan just purely on a sentimental and ideological bases are missing the most essential part of the argument, namely if Americans feel confident about the plan, then allow it to play out, since the same Americans will turn their back on the plan if it fail to meet their expectation.

Much has been said about how America is a free society and where choices are based on personal inclinations, and the same is applicable even in our investment choices among others. While it may be true that proposing such a health insurance plan may be something unthinkable for those who are extremely opposed to it and further very difficult to sell the idea to them, without doubt, it should be noted as true that proponent did understand the necessity of giving the American people the kind of choices that are evident in our telephone services, postal services and so many other services that forces healthy competition.

It should be a choice for me to make as to whether I want to mail my document for instance using the United States Postal Services or rather DHL or UPS among others. What are the fact ors that may have prompted me to make up my mind in such given scenario? As a matter of fact I would want to make sure that the quality of the service is not compromise, the delivery gets to its destination and importantly too I am able to afford it! Consequently the ultimate goal would be to ensure that with affordability essentially taken care of one should be able to have his or her mail delivered.

This simple analogy may be an over exaggeration of the health insurance plan and what it may hope to achieve, nevertheless it is also true that many choices could create the opportunity for healthy competition without necessarily compromising the quality of services.

As a Medical doctor, Pharmacist, Nurse, Physical Therapist, Dentist, Medical Laboratory Scientist or Medical Technologist among others in the medical and allied healthcare field, our principal obligation was and remains the same; essentially to serve humanity by helping to participate in the healing ministry of mankind and holistically protecting the sanctity of life at every given opportunity. However the prevailing scenarios have bastardized this inclination as a sequel to legal litigation, among other contemporary demands that make the practice of medicine too difficult for comfort.

Furthermore special interest, egocentrism, selfishness and unquantifiable greediness have infected so many of us in this country that as long as we are deny the opportunity to make money or get credit even for legitimate reason or the sake of humanity, we are ready to go hell-wire in order to protect our comfort zone. The same scenario is applicable to drug dealers who may be aware of the damaging effect of their business but are still hell bent on perpetuating the trade that have useless many of our lives and deprive humanity of the true meaning and beauty of life.

My convictions going by what the president has been saying are that he wants to focus more attention on preventive rather than just curative inclinations in medical and healthcare practices, and if am correct there is no professional out there that does not fundamentally appreciate and agree with such dogmatism. The practice of medicine hinges on three cardinal elements; diagnosis, treatment and prevention, and while these three are very crucial in elucidating and providing the best possible care for our patients, without doubt many have rely too heavily on treatment as opposed to prevention. This is our time to make prevention a focal point and help save the next generation of mankind.

Summarily, while it is not going to be easy for President Barack Obama to effectively introduce the public health plan, I am also confident that with the help of the American people and those in authority hopefully Americans will soon have an alternative to the currently run plan which will be typically Americanize in such a fashion that the argument that healthcare is being nationalize will became a lame excuse for those who are not supportive of this history making venture.

I will careless about how much I am making at my job place if by the time we have the public health insurance plan, majority of Americans will be position to get quality and affordable healthcare, since by implications tax payers money may not necessarily go into funds that carter for those who cannot afford health insurance, in addition to having a healthy nation.

Finally the maxim will then be true; “a healthy nation is indeed a healthy nation” and I do believe this is the fundamental aim and objective of the 44th president of the United States of America.

When it comes to getting the best deal on UK mortgage insurance then there is only one way to go and that is by doing your homework, shopping around and going with a standalone payment protection provider. A standalone provider will in most cases be able to offer you the cheapest quote on your mortgage insurance along with providing a quality product that is suited to your particular needs.

UK mortgage insurance – or mortgage payment protection insurance (MPPI) as it is also known – is taken out in case you should find yourself out of work through an accident, sickness or unemployment and the majority of policies will pay out for a period of up to 12-24 months once you have been out of work for a set period of time. While the payment protection insurance sector has recently been in the spotlight for all the wrong reasons with the emphasis being on the mis-selling of products along with extortionate premiums, it is a financial lifeline.

Your mortgage repayments are probably the largest outgoing you have each month and while the majority of us don’t like to think of the worst happening, it can and does. Protecting yourself with cheap but good quality UK mortgage insurance policy should be given some serious consideration and by shopping around and going with a standalone provider, is by far your best option for the cover.

Never be conned into taking out the insurance alongside your mortgage with the high street lender – you are free to buy it elsewhere – and remember that you don’t have to buy the cover from the lender who offers you the mortgage no matter how persuasive they can be. If you want the safety net that UK mortgage insurance can provide then go independently for the cover, you will not only make huge savings on the premium quoted but also get expert advice. When it comes to your finances and peace of mind nothing else will do.

Always make sure you read the small print of a policy and understand what you are and are not covered for, there can be many exclusions within a policy so do check before you sign on the dotted line.

One question that’s asked by nearly everyone eventually is “should I get a life insurance policy?”.

Life insurance pays out a benefit when the person insured dies during the time that the policy is in force. It can provide the cash needed to pay for burial, pay off mortgages and loans and give your family a financial cushion while they get back on their feet. When you’re young or have little discretionary income, it’s easy to tell yourself that life insurance is just for the well-off, but the truth is that life insurance is far more necessary for those who have no monetary cushion against life’s rougher times.

You should consider life insurance if:

- you have dependents

The moment you are responsible for another person in your life, you need life insurance. Whether it’s your children, a spouse or employees, if someone counts on your ability to earn an income, then life insurance is a necessity.

- you have a mortgage or other detbs

If you have a mortgage, you need life insurance to pay off the remainder of the mortgage if you should die before the mortgage is paid off. If you don’t have some sort of insurance to pay off your mortgage when you die, your heirs will have to deal with the debt.

- you own a business or are a key employee in a business

If you own a business, are partners in a business or are a key employee in a business, a life insurance policy can keep your business afloat while your employees or partners make arrangements to replace you or dissolve the business according to your wishes. If this is your reason for investing in life insurance, it could possibly be charged off as a business expense.

There are several types of life insurance available to you, and the type that’s best for you will depend on a number of factors. If your main concern is to ensure that your family is not saddled with a capital and interest mortgage in case of your death, then decreasing term life may be your most economical option. With decreasing term life, you pay for just the amount of coverage that you need. For example, if you take out a £150,000 capital and interest mortgage on your home, you can protect it with a decreasing term life policy that starts out with a payout of £150,000. That payout will decrease over the years as you pay off the mortgage loan.

Level term life insurance is the next tier of life insurance policy. Like decreasing term life, it pays out a benefit if you die under the terms of the policy – but rather than decreasing as your mortgage is paid off, it remains level. Generally, term life insurance is available in terms from one to forty years, and often comes with a range of options which can extend the policy at an additional cost.

Whichever type of life cover you need, it’s important to know exactly what’s right for your needs and what the various different companies and policies provide. If you are in any doubt about this you should consult an independent financial adviser who can look at your circumstances and match the best policy to your needs.

Insurance providers have a policy to overcome the most common consumer objection to purchasing term life insurance: what If I live? For those consumers who think term life insurance is a waste of money because they may not die, here is something to consider. If you can work a little extra premium into your budget here is a way to avoid the gamble and still protect your loved ones “the real purpose for life insurance” and recieve a cash benefit for staying alive.

What is ROP Return of Premium Insurance?

Return of Premium Insurance (ROP) is just as it sounds. The ROP is a rider attached to a basic term insurance policy that provides a living benefit to the insured. This means that should you outlive your policy term and keep it in force to the end of the level term period, you can receive all of your premiums back in a tax-free lump sum. The policy is similar to term in that it protects your family for a specified time period you select from 10 to 30 years. The ROP premiums are bit more costly than straight term in that the extra 30-40% you pay in premium is reinvested by the carrier and returned to the insured if they outlive the policy.

Why should you consider Return of Premium Insurance?

While insurance protection can be vital to protecting your family, many can find which type to purchase confusing. Let’s review the whole insurance picture for a moment: Term life insurance is the choice of many consumers because it fits the budget and simply protects young healthy expanding families during times of highest risk of loss should the income earner of the family die unexpectedly.

Traditional term provides a benefit for the length of the term period selected 10, 20, or 30 years after that the policy coverage ends. If the insured had passed on during the term of coverage the beneficiaries would have received a lump sum payout, but if the insured is still living at the end of the term or had cancelled the policy early, the beneficiaries receive nothing. Unfortunately after 20-30 years you may be uninsurable for more term because of health deterioration or age and may need to seek out a whole life or permanent insurance policy to protect your spouse or assets from risk during the retirement years. This form of insurance contain an investment feature which builds cash value and may require higher premiums and make the policy simply unaffordable for some. Return of premium can provide a suitable solution if it fits comfortably within the budget because it provides for a benefit for both events: A death benefit and a living benefit!  

What are some of the features of return of premium ROP insurance?

As we have already mentioned if you outlive the term you will receive all of your premiums back in a tax free lump sum and it is guaranteed. In addition should you need to borrow from these funds many carriers have loan provisions allowing you to borrow your own money at reasonable rates of interest and keep the coverage in place during the term period.  Many consumers are concerned that they may  cancel prior to the term ending and will lose the ROP feature they paid extra for, however carriers have already considered this as well and if you surrender the policy during the term you will receive back a prorated portion of the premium which are pre-calculated at policy inception. Another handy feature can help you keep your protection if you lost your job well into the policy term the ROP cash accumulation could be applied to provide for paid up reduced term period coverage, so if you had a 30 year term and in year 15 were injured or loss you job and were unable to pay premiums you may end up with a paid up policy for a remainder of 5 years.

Example

Male 32 years old with the highest health rating of Preferred Plus, $500,000 of coverage on a 30 year return of premium insurance term.

Monthly premium $54.98 Annual $659.76 the return of premium after 30 years would be $19,792.80

The premium for the same insured with straight term would be $38.06 per month

*If you are older or have a few minor health conditions the policy premium may be considerably higher as the carrier grades your mortality risks.

For most the Return of Premium can be a good option that can protect the family’s assets and large liabilities like the home in the event of an unexpected death. Additionally the lump sum return of premium can be used to pay down a considerable portion of those very liabilities , imagine paying $30,000 down on your mortgage balance in the 20th year or investing the tax free lump sum into an interest bearing annuity to create a retirement income stream for later years.