Recession-resistant tech stocks
Many technology companies were profitable last year, even as corporate earnings on the whole tanked, said Pat Dorsey in Money. Mostly, that’s because they entered the recession carrying only “modest debt,” rather than being leveraged to the hilt. This year, however, may not be so rosy. Tech firms could be “hurt by corporate America’s reluctance to lay out cash for big-ticket upgrades in such an uncertain economy.” One still-reliable bet will be Cisco Systems—which not only “dominates” the data-networking industry but is “using its heft” to move into such markets as security and videoconferencing. “True, Cisco will never see the blistering growth of the late 1990s.” But its annual revenue growth could be as high as 8.5 percent over the next five years. Another good choice is information-management giant EMC. While companies might put off discretionary technology purchases, “they can’t function without fire walls and places to store vital data.”
New rules for remodeling
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When it comes to home-renovation trends, wasted space and energy-hogging appliances are out, said Brad Reagan in SmartMoney. Likewise, “tacking on square footage with imposing entry halls and drafty great rooms no longer adds instant value.” Conspicuously large living spaces are hard to maintain, and right now they’re proving hard to sell. Home buyers today want functional living space and energy-saving upgrades. “It’s like we’ve flipped over 180 degrees,” says Kermit Baker of the Harvard Joint Center for Housing Studies. If you’re planning to remodel, “spend a few hundred dollars” for an energy audit. When adding or revamping rooms, design them to serve multiple purposes. What’s a home office now could be an in-law suite for the next buyer.
Debt is so not cool
The “deepest recession in decades” seems to be influencing how young adults manage their money, said Courtenay Edelhart in The Bakersfield Californian. “I pay cash for everything,” says Luz Leal, an 18-year-old studying bookkeeping at Bakersfield College. “It’s better that way.” Leal’s peers share her debt-averse attitude, according to a poll sponsored by the Northwestern Mutual Foundation and the National Council on Economic Education. When asked what they’d do if they found “a great item at the mall” that they couldn’t afford, 54 percent of respondents ages 29 and younger said they would save up for the item before they bought it. Only 42 percent of adults 30 and older said they’d do the same.
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