ShoreBank Blog
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Archive for June, 2009
Tuesday, June 30th, 2009
With all the time we spend online it is nice to have the Fourth of July to look forward to. It is a big day for good old in-person cookouts and picnics with friends and family. And there is no better place to get the food you’ll need than your local farmers market. ShoreBank is lucky enough to host a farmers market every Wednesday during the summer in the parking lot of our branch at 71st and Jeffery in Chicago. I stopped by last Wednesday expecting a little dose of food – and while I got that, I also ended up getting a big dose of family.
I had heard of San Diego and San Francisco but…SanJustins? How did I miss them on my last swing through the west coast? SanJustins is a small bakery stand at the farmers market. It is run by Sandy with a lot of baking done by her son Justin (get it? SanJustin). Even her sister was helping her out. Sandy is building her business in Chicago and has her business plan – for now she is three weeks into her first season at a farmers market. She already has loyal customers (one stopped by for her sweet potato nut bread) and she is testing ideas and responding to market feedback (she added banana nut bread without sugar for customers who might be diabetic).
While Sandy may be in her first season, Andy of Blankenship Farms essentially grew up at farmers markets – this one included. Although Andy has had a stand at our farmers market for 6 years, his parents were previously there for over a decade. And as a little boy he came with them so some of Andy’s customers have known him since he was a kid. And this week – cherries should be coming in!
The “all-in-the-family” trend continued at Mark Farm but in a way that surprised me. This farm is in Indiana but the first person I talked to surprisingly lived across the street from the market, on Chicago’s South Side. Gregory was working the stand after his one minute walking “commute.” But he isn’t the first one in his family to make that short walk to work. His father was a Mark Farm customer who later started working there and Gregory has followed, literally, in his footsteps.
So if your local farmers market is full of great family stories too – and I bet it is – there is actually a way you can leverage your digital expertise to help. The site Care2.com is running an online voting campaign on farmers markets. Vote for your favorite and the market with the most votes will get $5,000. Three cheers for the family of farmers markets!
Tags: community development, farmers market, green banking, ShoreBank, social media, triple bottom line
Posted in Community | No Comments »
Tuesday, June 23rd, 2009
President Obama’s recent televised fly swatting impacted more than just the fly. It sparked both PETA to send Obama a device that traps flies for subsequent outdoor release and an online debate across social media sites as to whether or not PETA overreacted. The result may influence whether or not Obama swats again. It is clear that Eco-Activism 2.0 is in full swing but it begs the question ‘can online eco-activism actually make a difference?’
For those people who are unfamiliar with the term ‘Eco-Activism,’ it is used to describe a person, such as Van Jones or Al Gore, who is involved in heightening consciousness and promoting potential behavioral solutions to environmental issues. There are many types of Eco-Activists. The type to which I am referring is rooted in good old fashioned person to person conversations. The more people to whom you speak, the more likely you are to reach the ‘tipping point.’ As the need to ‘go green’ intensifies, so too does our need to spread the world quickly. And what spreads the word more quickly than social media? The problem is to make sure that the word does not just spread online, but that corrective solutions are taken offline.
Two social media websites, 2people.org and changents.com, are designed to enable eco-activists to connect and to form online communities focused on solving environmental problems. 2people.org’s goal is to create a critical mass of activists who will create enough buzz about global warming that it will cause people to do something about it. Its basic social networking features allow people to form activism teams, to create a virtual workspace, and to monitor events, people, and actions in the world. Changents.com then enables Change Agents (Changents) to team-up with a receptive audience of Backers who can respond to, spread, support and consumer their innovations and ideas. They have offline abilities to back a Change agent through Action Requests.
Although still in Beta, in its first year, changents.com has already received 235 action requests for 157 Change Agents. One such Change Agent is the Big Green Bus team – a group of 15 Dartmouth students who are driving a huge green solar paneled veggie-oil powered bus cross-country to bring awareness to how we can all change the reliance on energy. The requested action: that their 122 Backers forward their schedule and message to their friends. Eco-Activism 2.0 is working. The team met with Senator Jeanne Shaheen and House Representative Dave Reichert last Friday.
For those people who are unable to make the time and effort to “change the world,” supporting an online eco-activist site makes it incredibly fun and easy. All it takes is just getting online and enabling social media to spread the word.
We really can move a nation—if each of us moves two people. And going out and changing the world is really as simple as clicking a mouse.
Tags: community development, Eco-Activism, green banking, green transportation, ShoreBank, social media, triple bottom line
Posted in Outreach | 3 Comments »
Tuesday, June 16th, 2009
Increasing numbers of homeowners are having a difficult time maintaining a good payment history with their mortgage lenders due to rising unemployment and to sharp increases occurring in their monthly payments as a result of adjustable rate, interest-only, and “option ARM” mortgages. With nearly a quarter of the nation’s mortgages scheduled to reset in 2009, according to the Center for Responsible Lending, thousands of Chicago homeowners will be at risk of falling behind on their mortgages and perhaps even losing their homes due to job loss and high-cost mortgages.
Whether you are a homeowner with an adjustable rate mortgage or just know someone with one, the following is a list of action steps that can help you get control of your finances and save your home.
1. Create a budget. Identify and list expected income and expenses for the next several months to determine what costs can be reduced to set aside more money for making the house payment.
2. Contact your Servicer to inquire about a modification of your current loan, which can lower your payment and fix the rate of interest going forward.
3. Check your refinance options. If the original lender is not responsive, you may be eligible to qualify for a 15- or 30-year fixed-rate, Energy Conservation or Rescue Loan from ShoreBank. Successful ownership is still the best way to build equity. To learn more about your refinancing options or the Rescue Loan program, contact a ShoreBank mortgage lending specialist at (773) 420-HOME (4663). Consultations with a ShoreBank lender are free and there is no obligation.
4. Get help. Contact nonprofit organizations such as Neighborhood Housing Services in Chicago that has counselors available at no charge to help you to evaluate all your options. For assistance in Cleveland, Detroit, and other areas, contact The Housing and Urban Development Department at (800) 827-1000 to receive a referral to a financial counselor in your area.
And, do not forget, you can also provide help to those who are struggling to keep up with their mortgage. For example, a significant number of our refinance mortgage customers have told us that they discovered the Rescue Loan and Prevention Program because someone at work or a neighbor, usually someone without mortgage payment difficulties, encouraged them to seek help.
With the number of foreclosed, empty homes not just in our urban neighborhoods but in suburban ones too continuing to increase, it is vital that if we wish to get the struggling market back on its feet and stabilize our community, we need to do whatever we can to assist homeowners at risk.
Tags: community development, foreclosed home, green banking, mortgage payment assistance, refinacing, ShoreBank, triple bottom line
Posted in Mortgage Lending | 1 Comment »
Tuesday, June 9th, 2009
As an ordinary American, wondering if you can keep your job or make your mortgage payment, you may be surprised to learn that the recession is almost over. But, this is what the economists are telling us. All the indicators, they say, now point to recovery. One on the key data series showing better days ahead is Personal Income and Outlays, released monthly by the Bureau of Economic Analysis. Earlier this week, the BEA reported that American’s disposable personal income rose 1.1% in April to $10.91 trillion on an annualized basis. That’s a big jump, but let’s look at the details to see if it really is a harbinger of spring.
Collectively, personal income has five components, shown below as percentages for April:
As you can see, the biggest contributor by far is employee’s compensation, but that’s not the source of April’s increase. Rather it can all be found in higher government transfer payments and lower taxes.
According to the BEA, “Provisions of the Federal Additional Compensation Program of the American Recovery and Reinvestment Act of 2009 boosted the level of personal current transfer receipts by $11.8 billion at an annual rate in April.” What a mouthful, but, hey, $11.8 billion is a lot of money! Except what it actually translates to is an extra $25 a week if you are collecting unemployment insurance.
Much bigger contributions came from tax reductions. The Making Work Pay Credit provision of the Act reduced personal current taxes by $49.8 billion at an annual rate in May. This provision allows a refundable tax credit of up to $400 for individuals and $800 for working couples. Reductions in payroll taxes added $63.6 billion (again, annualized) to May income.
What did we do with this bounty? Answer: We saved it; that is, we didn’t spend it. The BEA calculates the savings rate by subtracting personal outlays from disposable personal income. Putting $100 in the bank counts as saving, but so does paying off your credit card bill. Using this definition, the rate of US savings as a percentage of disposable income rose to 5.7%, the highest since 1995. Spending actually decreased 0.1% from March, and spending, not saving, drives the economy. Also, a little suspicion about the permanence of tax reductions might be warranted, with the Federal budget deficit spiraling into the trillions and only a handful of states able to balance their budgets.
Still, there are powerful signs that a recovery has begun. The Dow Jones Industrial Average has gained more than 2100 points or 33% since hitting its low early in March. Globally, commodity prices are soaring as is industrial production in China. In the US, long-term interest rates are rising because bond traders have started worrying about inflation, which can accompany strong economic growth. As result, the average rate for new 30-year mortgages jumped to 5.29% last week, from a low of 4.78% a month ago. I’m feeling better already. Aren’t you?
Tags: community development, economic predictors, financial crisis, green banking, ShoreBank, triple bottom line
Posted in Banking Industry | No Comments »
Tuesday, June 2nd, 2009
Last week, I attended an invite-only discussion coordinated by the Department of Energy’s Energy Efficiency and Renewable Energy (EERE) group about the business models needed to exponentially expand energy efficiency within the residential sector. This sector is clearly a priority for the Department of Energy and President Obama. Given how inefficient most homes are and the potential for a residential energy efficiency initiative to drive significant job creation, the government will be directing billions in the coming months on this sector.
The discussion covered the usual issues such as the lack of uniform standards; inadequate processes for verification of savings; problems in the credit markets; and ineffective marketing approaches and messages. A more interesting facet of the discussion related to the philosophical differences among the attendees. One critical question centered on the marketing messages needed to catalyze consumer behavior. One school of thought focused on the need to improve how we communicate the financial benefits of energy efficiency to homeowners. A second approach suggested that emphasizing other types of benefits, such as safety, comfort, etc., may be more effective than sticking to the usual economic rationale. While I can see merits in both, I find myself siding with the latter approach. In particular, I look with envy at the way the organic food sector has just exploded – and this is a product that typically costs more than the alternatives, not less.
The second philosophical question reflects whether the large governmental influx of funds will help catalyze the marketplace or stymie its development. In particular, there is some question about whether the government will let the marketplace lead the way or will overly direct how it develops. Personally, I am fearful that in their haste to get stimulus funds into the community quickly, DOE will rely heavily on old models and existing programs. While many, such as the ENERGY STAR brand, have proven quite effective, we need to create and deploy new models, most of which don’t exist today. Moreover, due to the public ire about waste and fraud, officials are rightly concerned about demonstrating success. Yet, experimentation, and, indeed, failure, are critical for market development and expansion. Neither is likely to be seen by DOE as a measure of success, nor a milestone to be touted to the public.
Tags: community development, energy conservation loans, energy efficiency, green banking, green building, ShoreBank, triple bottom line
Posted in Green Collar | 1 Comment »
