March, 2008

Worthless Diplomas

          Human resources directors who complain about the lower intellectual caliber of today’s job candidates may have a point, at least according to one widely used measure of job applicant learning speed.  In a recent study of Wonderlic Personal Test results from over 200 employers, 2000 jobs and 100,000 applicants over a span of 35 years, a steady decline in cognitive ability scores was found.
          In other words, the value of a high school diploma from a graduate of 1970 equals an employee today with two or more years of college training.
          This means that students have to stay in school longer just to stand still academically which drives up costs with no net gain in economic value.  Law Firm Inc. January/February 2008

NY is #1 in Union Membership

          The U.S. Labor Department reported that the percentage of unionized workers jumped 3 points to 25.2% in New York, the highest in the nation.  Labor union membership in New York rose last year as union leaders stepped up organizing efforts.
          In 2007 2.1 million workers in the state belonged to unions, up from 2 million the year before.  The rise follows a period between 2005 and 2006 where membership in the state fell 5%. 
          Nationally, union membership rose by 311,000 to 15.7 million, comprising 12.1% of the workforce.  Membership declined in 27 states, including New Jersey and Massachusetts.
          New York has 4X as many union members as Texas despite having 1,700,000 fewer workers! Crains New York.com 3/12/00

Say it Ain’t So

          The recent push by the Financial Industry Regulatory Authority (FINRA) to return money to harmed mutual fund investors was part of what should be a never-ending effort by the financial services industry to find ways to maintain consumer faith in the marketplace.  FINRA recently settled cases against Merrill Lynch & Co., Inc., Prudential Financial, Inc., UBS Financial Services and Wells Fargo Co.. that could result in the return of more than $25,000,000 to fund investors who did not receive the benefit of NAV transfer charge waivers to which they were entitled.
          “Firms have an obligation to consider all relevant factors when recommending mutual fund investments to ensure that they recommend the share class that is most advantageous to the customer.  Investment News.com 3/10/08

Beware your local Tax Preparer I

          The New York State Department of Taxation and Finance Commissioner announced that two owners and operators of a Queens tax preparation business were assessed $606,000 in fraud penalties for preparing and filing 585 bogus tax returns for tax years 2002 to 2004.  Both women pled guilty to felony charges.
          To generate false refunds, the preparers inflated their clients itemized deductions and reported false business and rental property losses.
          NYS reminds taxpayers they are responsible for filing accurate returns and paying the correct amount of tax on time.  If your tax preparer led you to believe that your return does not have to be accurate, they are wrong and their advice can lead to civil and criminal penalties against both the tax preparer and the taxpayer.  NYS Department of Taxation and Finance 3/19/08

          If you have any questions about the foregoing or any other financial matters, please call us.  If you want to read more, visit the AOHL Newsletter Archives at www.lisch.com.

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