Financial crisis: role model for way forward – USAA

Thursday, November 20th, 2008

Disclosure: been member since 1972. Advantage is that USAA can only sell to members with military affiliation. Knows who it is and completely committed to its membership. If you’ve had any connection to the military through your own service or that of a family member, I recommend that you research your eligibility.

“Standard & Poor’s has affirmed its Insurer Financial Strength Ratings of AAA (Extremely Strong, highest of 21 possible ratings) on United Services Automobile Association and its Property & Casualty Companies (USAA P&C Group) and Life Insurance Companies. USAA is one of a small, elite group of companies to retain the highest ratings from one of the world’s largest and well-respected rating agencies.”

The affirmed Standard & Poor’s AAA rating is recognition of USAA P&C Group’s high capitalization and financial strength, which is built on profitability, steady recent increases in net worth (more than doubled since 2000), minimal debt, and access to strong liquidity sources.

“We work very hard to keep a strong balance sheet and to meet our financial commitments to our members, and we’re gratified that Standard & Poor’s continues to recognize us for our performance, especially in today’s rugged financial environment,” said Kristi Matus, USAA’s chief financial officer. “For 86 years, through good times and bad, we’ve never wavered from that commitment. We’re extremely proud of that track record and remain squarely focused on doing all that we can to facilitate the financial security of our members and their families.”

According to Standard & Poor’s, USAA P&C Group has a conservative investment strategy and better-than-industry-average liquidity and operating results; additionally, Standard and Poor’s noted that overall USAA has demonstrated an excellent enterprise risk management framework, which is embedded into its corporate culture.

Standard and Poor’s also commented on USAA’s Life Insurance Companies, noting its industry-leading persistency, which reflects its superior customer service and military affinity, conservative investment portfolio, and strong earnings.

Hysteria is uniform; is the financial crisis?

Friday, November 14th, 2008

I know that we’re all affected. At a customer meeting this week, the president of a large financial firm commented that his 401k has devolved into a 201k. Clever and accurate for many of us.

I visited 2 shopping malls in my area over the past 2 weeks where parking spots were difficult to locate. Clearly individual spending has frozen and I have this notion that the economic impact of the mortgage-induced crisis is not as uniformly spread has we may be led to believe. Meaning to me that the way back will be a climb, but not one requiring lots of oxygen bottles. America and Americans must modify many of our business and personal management habits – get back into fighting shape sort of program – and we should not abandon in self-pity who we are and what we’re capable of. I guess that I am confessing that after a one year hiatus, I resumed my 401k contributions this month. After the 500 point bounce yesterday, my portfolio may now be a 250k.

Let’s not waste time and energy bailing-out institutions and individuals who have foolishly wasted their opportunities to prosper in our country and its economic system.