Feature

What the experts say

Wall Street’s short memory; Take stock of CEO perks; Trading in your old CDs

Wall Street’s short memory
Bad habits from the run-up to the financial crisis “appear to be slowly creeping back,” said Nin-Hai Tseng in Fortune.com. Risky borrowers are beginning to get loan offers again from large lenders: More than 1 million people with damaged credit were issued credit cards in December, up 12 percent from 2010. And AIG, which had to be bailed out after making bad bets on U.S. housing and real-estate markets, plans to dip its toe back into property investment this year. There are fears that “banks are taking excessive risks” with their own funds again, fueled by reports that a JPMorgan Chase banker has been dubbed the “London whale” for his massive position in credit-default swaps. It even appears that once-toxic mortgage bonds are making a comeback. Prices of some bonds backed by subprime home loans have experienced double-digit percentage gains this year. It makes you “wonder if the crisis ever happened.”

Take stock of CEO perks
It’s time for investors “to get in touch with their inner Robin Leach” and scrutinize the lives of the wealthy, said Kathy Kristof in Kiplinger.com. Spring is when most publicly traded companies send out proxy statements, which contain details about executives’ “eye-popping pay and perks.” Why do these figures matter? Because CEO pay can be an “early warning sign that something is amiss.” Watch out for red flags like pay disparity. If the CEO earns vastly more than the rest of the C-suite, it may mean the company has “a weak bench.” Egregiously high pay packages should also give pause. And check the “other” column, which details what a firm doles out for perks like country club memberships and chauffeurs. It will tell you whether the boss is putting too much on the company tab.

Trading in your old CDs
Amazon wants to buy the CDs gathering dust at the back of your closet, said Nancy Blair in USA Today. The online retailer’s trade-in program already swaps Amazon credit for used books, video games, DVDs, and electronics like old iPods, but last week, it added music CDs to the mix. At the site, just type in an artist or album name to see the offer price; last week The Hunger Games soundtrack was fetching $2.65 and Bruce Springsteen’s Wrecking Ball up to $4.30. Once you accept the offer, Amazon provides a free UPS mailing label and deposits credit in your account when it receives the goods.

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