Sarah Palin steps down as Alaska governor

Sarah Palin stepped down Sunday as Alaska governor to write a book and build a right-of-center coalition, but she left her long-term political plans unclear and refused to address speculation she would seek a 2012 presidential bid.

In a fiery campaign-style speech, Palin said she was stepping down to take her political battles to a larger if unspecified stage and avoid an unproductive, lame duck status.

"With this decision, now, I will be able to fight even harder for you, for what is right, and for truth. And I have never felt that you need a title to do that," Palin said to raucous applause from about 5,000 people gathered at Pioneer Park in Fairbanks.

Her first order of business as a private citizen is to speak Aug. 8 at the Ronald Reagan Presidential Library in California. She also wants to campaign for political candidates from coast to coast, and continue to speak her mind on the social networking site Twitter, one of her favorite venues to reach out to supporters.

Free speech was a theme of her farewell speech at a crowded picnic in Fairbanks, as the outgoing governor scolded "some seemingly hell bent on tearing down our nation" and warned Americans to "be wary of accepting government largess. It doesn't come free."

She also took aim at the media, saying her replacement, Lt. Gov. Sean Parnell, "has a very nice family too, so leave his kids alone!"

And she told the media: "How about, in honor of the American soldier, you quit makin' things up?"

She didn't elaborate, but Palin said when she announced her resignation July 3 that she was tired of the media focus on her family and felt she had been unfairly treated by reporters and bloggers.

Friend and foe alike have speculated that Palin may host a radio or TV show, launch a lucrative speaking career or seek higher office in Washington.

Palin hasn't ruled out any of those options, and her political action committee, SarahPAC, has raised more than $1 million, said Meghan Stapleton, a spokeswoman for the committee and the Palin family.

Stapleton said Palin is still deciding what her future will be.

"I cannot express enough there is no plan after July 26. There is absolutely no plan," she told The Associated Press.

Palin's surprise announcement she was stepping down 17 months before the end of her first term pushed her favorability rating down to 40 percent, according to a Washington Post-ABC poll. Fifty-three percent of those polled gave her an unfavorable rating.

Last summer, almost six in 10 Americans viewed her favorably. The latest poll was taken July 15-18.

Nearly 20 ethics complaints had been filed against Palin, and the outgoing governor cited the resulting investigation's financial toll — both on her and the state — for stepping down. An independent investigator looking into the complaints found evidence she may have violated ethics laws by trading on her position as she sought money for lawyer fees, according to a report obtained recently by The Associated Press.

Parnell, 46, of Anchorage, was sworn in Sunday as the state's new governor.

"I'm firmly convinced that Alaska's greatest days are ahead," Parnell said in pledging to continue Palin's policies, which he said "put Alaska first."

Palin received a warm welcome Sunday, both during her speech and as she served food at the annual Governor's Picnic.

Among those present was Donna Michaels, 57, of Fairbanks, who wore a red T-shirt that said: "Palintologist."

The T-shirt defined a Palintologist as "someone who studies Palin and shares her conservative values, Maverick attitude and American style."

Michaels also held a poster board sign showing the front page of the Fairbanks Daily News-Miner when Palin announced she would resign. Michaels altered the banner headline "Palin steps down," replacing the last word with "up."

"She's really not stepping down. She's stepping up to do something bigger and better," said Michaels, who attended the picnic with her daughter and two granddaughters, one of whom who wore Sarah Palin-style eyeglasses.

Larry Landry, 51, of Fairbanks held up a red, white and blue sign that that read, "Quitting: the new American value." The other side read: "Thanks for the laughs."

Landry, a registered independent, said he respected Palin when she ran for governor in 2006, but he felt she changed during last year's presidential campaign.

"She turned into a vicious vixen," he said. "She descended into ugly, divisive politics."

Alaska's first female governor arrived at the state Capitol in December 2006 on an ethics reform platform after defeating two former governors in the primary and general elections. Her prior political experience consisted of terms as Wasilla's mayor and councilwoman and a stint as head of the Alaska Oil and Gas Conservation Commission.

Unknown on the national stage until Republican John McCain tapped her as his running mate, Palin infused excitement into the Republican's presidential bid. But she also became the butt of talk-show jokes and Democratic criticism, especially after it was revealed that the Republican Party spent $150,000 or more on a designer wardrobe for Palin.

Former state House Speaker John Harris, a Republican with sometimes chilly relations with Palin, said he thinks Palin will run for president in 2012, although he has no inside information.

Stapleton said the answer will emerge in the coming weeks.

On Monday, "we'll sit down and say, 'OK, here are your options. How do you now want to effect that positive change for Alaska from outside the role as governor?'" Stapleton said.

Bernanke had to 'hold my nose' over bailouts

Federal Reserve Chairman Ben Bernanke said Sunday that he had to "hold my nose" over last year's taxpayer-financed bailouts of big financial companies but argued that the action had to be taken to avoid a major meltdown of the U.S. financial system and the broader economy.

Bernanke's comments came during a town-hall style meeting in Kansas City, Mo., where he was peppered with several questions about government decisions last year to rescue so-called "too big to fail companies" like insurance giant American International Group, whose collapse would have wreaked havoc on the global economy.

A small-business owner complained to Bernanke that such actions were "hard to swallow," saying he felt like small businesses -- also struggling to survive the recession and all the financial fallout -- were being shortchanged.

"Nothing made me more frustrated, more angry, than having to intervene" when companies were "taking wild bets," Bernanke said. But not acting would have had grave consequences for the economy, he added.

"I was not going to be the Federal Reserve chairman who presided over the second Great Depression," he said. "I had to hold my nose. ... I'm as disgusted as you are. ... I absolutely understand your frustration."

Public television's Jim Lehrer moderated the one-hour town hall meeting. It will air this week in three installments on PBS' "The NewsHour with Jim Lehrer."

At the height of the financial crisis last fall, Bernanke recalled spending nights on the sofa in his office. It was a "perfect storm," he said, where housing, credit and financial problems converged into a major crisis the likes of which haven't been seen since the 1930s. To deal with the crisis, Bernanke said he sometimes had to do things "outside the box."

The financial crisis underscores the need for Congress to enact legislation that will create a government mechanism for safely unwinding big financial companies, along the lines of the process used by the Federal Deposit Insurance Corp. to handle failing banks, Bernanke said.

When asked about the Fed's diligence in protecting consumers, Bernanke acknowledged that "we were late in addressing the subprime lending problem," referring to the risky mortgages and dubious lending practices that powered the housing boom and contributed to its crash. "We have to take some heat for that."

Still, Bernanke made the case -- as he did last week on Capitol Hill -- that consumer protection oversight should stay with the Fed. An Obama administration proposal would create a new consumer protection agency overseeing mortgage, credit cards and other financial products, stripping the Fed of some of its duties. Of setting up such a new agency, Bernanke seemed to soften his earlier stance, saying, "I'm neither opposed to it or in favor or it."

When Lehrer said some people think the Fed is the fourth branch of the government, Bernanke responded, "That's a tremendous exaggeration." He said the Fed's independence from political interference in setting interest rates to influence economic activity is crucial. "You get much better results" for the economy when this is the case, he said. "We're very, very sensitive to this issue."

Asked about President Obama's $787 billion stimulus package of tax cuts and increased government spending, Bernanke said most of the money will flow in 2010 so "it might be a little bit early" to judge its effectiveness. Although big budget deficits couldn't be avoided this year and next, given government efforts to help the economy, Bernanke urged Congress to develop a plan now to bring back "fiscal sanity."

On the economy, Bernanke repeated the Fed's forecast that unemployment will probably top 10 percent this year, even as the economy starts growing again in the second half of 2009. The jobless rate is now at a 26-year high of 9.5 percent. In a "few years" the economy will be back on track and "growing strong again," Bernanke said. "It will take some patience."

The Fed, he said, "has been putting the pedal to the metal" to turn the economy around.

Bernanke's appearance on the program is part of a broader campaign, unusual for a Fed chairman, to reach out to ordinary Americans. In March, Bernanke granted a rare TV interview, appearing on CBS' "60 Minutes."

His efforts to explain the Fed's actions to get the economy and financial markets back on firm footing comes as the clock ticks on Bernanke's term as Fed chief. His term expires early next year, and President Barack Obama has not said whether he will be reappointed.

The Fed chief, who took the helm on February 2006, has been on the front lines of efforts to battle the financial crisis and end the recession, the longest since World War II.

His aggressive and unconventional actions -- including supporting the bailout of AIG to the tune of more than $180 billion -- have been credited with averting a financial catastrophe last year but also have touched off anger from the public and lawmakers on Capitol Hill about helping financial companies that made reckless gambles.

PTC: A Total Cheat (Chapter 3: Scripts) | NEEDS TO KNOW

PTC: A Total Cheat (Chapter 3: Scripts) | NEEDS TO KNOW

Reverse mortgages can provide extra cash

Many people have seen TV ads featuring actor Robert Wagner encouraging senior citizens to consider reverse mortgages to provide extra dollars for their golden years.

In a regular mortgage, homeowners make payments to lenders. In a reverse mortgage, however, homeowners receive money from a lender and usually are not required to pay it back as long as they live in their homes, according to the Federal Trade Commission.

Reverse mortgage loans, based on home equity, are repaid when homeowners die, sell their homes or no longer live in the residences.

“Reverse mortgages can help homeowners who are house-rich but cash-poor stay in their homes and still meet their financial obligations,” a report from the FTC states.

SouthEast Arizona Governments Organization, headquartered in Bisbee, offers reverse mortgage counseling at no charge, said Julie Packer, the organization’s housing programs administrator. A SEAGO counselor will counsel homeowners at their residences. There is no need to travel to Bisbee for this service.

Packer said reverse mortgages are for senior citizens who have paid off or nearly paid off their regular mortgage.

“It’s not for everyone, though,” Packer said. “It’s kind of like home ownership. Home ownership is not for everyone.”

According to the FTC, reverse mortgage loan advances are not taxable and usually do not affect Social Security or Medicare benefits. Owners retain titles to their homes and are not required to make monthly repayments.

The loan must be repaid when the last surviving borrower dies, sells the home or no longer lives in the house as a principal residence.

There are three types of reverse mortgages: Single-purpose, which are offered by some state and local government agencies and nonprofit organizations; home equity conversion mortgages, known as HECM, which are federally insured, and proprietary reverse mortgages, which are private loans that are backed by the companies that develop them.

Single-purpose reverse mortgages generally have low costs, but they are not available everywhere, and they can be used for one purpose specified by the government or nonprofit lender.

Proprietary mortgages and HECMs tend to be more costly and are widely available — and carry higher upfront costs to homeowners.

In the HECM program, a borrower can live in a nursing home or other medical facility for up to 12 months before the loan becomes due and payable.

There are several features of a reverse mortgage to consider, including the following:

• Lenders generally charge origination fees and other closing costs for a reverse mortgage. Lenders may also charge servicing fees during the term of the mortgage. The lender generally sets these fees and costs.

• The amount owed on a reverse mortgage usually grows over time. Interest is charged on the outstanding balance each month and added to the amount owed.

• Reverse mortgages may have fixed or variable rates. Most have variable rates that will likely change.

• Reverse mortgages can use up all or some of the equity in your home, leaving fewer assets for you and your heirs. A “nonrecourse” clause in most reverse mortgages prevents either you or your estate from owing more than the value of your home when it is repaid.

• Owners retain titles to their homes and remain responsible for property taxes, insurance, utilities, fuel, maintenance and other expenses.

• Interest on reverse mortgages is not deductible on income tax returns until the loan is paid off in part or in full.

• For homeowners at least 62 years old, a reverse mortgage can be used to generate funds to prevent the foreclosure of a regular mortgage.

Packer said anyone considering a reverse mortgage should try to use a local lender or one of the larger, well-known banks, such as Bank of America or Wells Fargo.

She also said to make sure the appraiser is familiar with property values in Graham or Greenlee counties, and does the appraisal with local criteria in mind.

A Guide to Investing for College Students

Investing for beginners is easier than ever before. With access to the stock market as close as your keyboard, you're just clicks away from getting started. Just learn the basics and find the right online tools to help you, and you'll be on your way.

The first concept to get to know in beginner investing is compound interest. The same principles of interest that can keep you in debt when you're trying to manage your credit work to your advantage when you invest money. Simply put, it means that the interest you make on an investment is added to your original investment and then reinvested to make even more interest. It's not as complicated as it sounds.

Here's a simplified example. An original investment of $100 with a return rate of 10% that's compounded yearly would make $10 in interest in year one for a total balance of $110. In year two if that $110 achieves the same 10% yield, it would add an additional $11 to the total. Continue to let the money compound over the next 18 years at 10% annually and by the 20th year it would be $672.75. But let it continue to compound for 30 or 40 years and it would grow to $1,744.94 and $4,525.93 respectively. All that without adding any additional money. Wow!

If you've determined that investing is right for you, you should look for an online discount stock brokerage or other financial services company that allows you to open an account with a low minimum balance, or none at all. The company you choose should offer low maintenance and trade fees, while providing you with tracking and investment management tools so that you can easily keep an eye on your investments. But before you sign up, you should know some basic investment terms and products.

There are many other definitions and concepts that you should have a working knowledge of as a beginner investing for the first time. These include:

* 401K - A company-sponsored retirement plan that allows you to contribute pre-tax dollars. 401Ks shelter your interest earnings as you continue to work, so that you'll only be taxed when you retire and withdraw money. 401Ks help to reduce your taxable income each year, saving you money on federal, state and local income taxes
* Bond - When corporations and governments borrow money from investors they are given a bond. The borrower in this case agrees to pay the investor the price of the original 'loan' plus interest at a predetermined later date
* Capital gain/capital loss - The money made or lost from an investment
* Certificate of Deposit (CD) - Typically a bank-issued document that guarantees an investor a specific yield on an amount of money when 'lent' to the bank for a pre-determined period of time. CD terms range from a month to several years
* Diversification - Making investments in different types of funds to help distribute your risk. Some funds are diversified in themselves, and could for instance include stocks from biotech, telecommunications, banking, entertainment and food manufacturing companies
* Individual Retirement Account/IRA - A retirement account that provides tax-deferral or other tax benefits
* Interest - The amount paid by a borrowing party for use of a lender's money. With credit cards you are the borrower, with investments you are the lender
* Mutual fund - A financial product that is managed and marketed by an investment company and can be comprised of stocks, bonds, or other securities products. The investment company pools investor contributions to buy and sell stocks and bonds for the entire group
* SEC/Securities and Exchange Commission - The governmental regulation agency that was established to help protect investors and oversees participants and activities in the world of securities
* Securities - Any type of investment product like a stock, bond, note, etc.
* Stock - A certificate or share of ownership in a corporation
* Trader - One who buys and sells securities like bonds, stocks, etc.
* Yield - The return on an investment as a percentage

If you grasp these investing for beginners basics, you can be investing in no time. Sure growing your investments may take time, but the returns will be well worth the wait.

How to Save Money When You Have None

Learning how to save money when you have none may seem like an impossible task, but we Save is here to help.

Set Manageable Goals

The key to learning how to save money when you have none is to think small. If you're struggling to keep a roof over your head and food on the table, planning for retirement or saving for a child's college education probably seems like an impossible goal. Focus on finding more manageable ways to save money. For example:

* Set a goal of cutting $10 per week from your budget. This can be accomplished by taking the bus instead of driving to work, eliminating a trip to a fast food restaurant, clipping coupons, or checking out movies from the public library instead of going to the video store. Once a week, make a trip to the bank to deposit the $10 in your savings account.
* Empty the spare change from your pockets into a jar whenever you walk through the door. When the container is full, add it to your savings account.
* Have a garage sale, take old items into a consignment shop, or sell collectibles on eBay.
* Spend an afternoon collecting cans from the side of the road to return for the deposits.
* Look for ways to earn extra money to give yourself a bit of a financial cushion. Babysitting or doing yard work for people in your community is a great idea. LoveToKnow Business also has a number of suggestions in the article,Home Based Businesses for Under $ 100.

Ask for Help Learning How to Save Money When You Have None

If you're struggling, there's no shame in asking others for help. Don't let foolish pride keep you from making the most of a bad situation. You can always repay the favor after your financial situation improves.

If you're in need of food assistance, consider the following resources:

* Angel Food Ministry allows people in any income bracket to purchase boxes of deeply-discounted groceries once per month. The basic box contains enough food to feed a family of four for one week.
* Pregnant women in a low-income bracket and those with children under the age of five can get milk, juice, cereal, and other necessities through WIC. The program also offers nutrition advice, free dental screenings, and assistance with family planning needs.
* The Supplemental Nutrition Assistance Program allows people with low incomes to purchase the food they need. You do not need to be married or have a child to qualify.
* If you're really in a bind, community food pantries provide temporary assistance with groceries. In most cases, all you need to receive help is proof of your legal address.
* If you have children in school, they may be eligible for free or reduced-price meals. Some schools also have programs that allow kids to sign up for a bag of groceries to take home on the weekends.

Other forms of assistance for how to save money when you have none include:

* Medicaid provides medical insurance for low income individuals and families who fit into an eligibility group that is recognized by federal and state law.
* The State Children's Health Insurance Program (SCHIP)offers coverage for children in families that earn too much for Medicaid, but not enough for private insurance.
* The Find a Health Center site can help you locate a clinic with a sliding scale fee system if you are uninsured and don't qualify for Medicaid or SCHIP coverage.
* Wal-Mart's $4 prescription program can help you pay for some of the medications you need, regardless of your income. Many other stores also have similar programs.
* LIHEAP provides assistance with heating costs during the winter months.
* Toys for tots provides Christmas gifts for needy children.

Facebook seeks new finance chief as Yu leaves

Facebook said Tuesday that its finance chief has left and that it is seeking a successor with "public company experience," a move that will feed speculation that the social networking titan is preparing for an IPO.
Gideon Yu, who had served as chief financial officer since 2007, departed for undisclosed reasons.

Co-founder Mark Zuckerberg has repeatedly said that an IPO was possible for the privately held Palo Alto company in the future, but always cautioned that such a move was not imminent.

In any case, investor appetite for initial public offerings has evaporated because of the depressed economy. Only one U.S. company went through with an IPO in the first quarter, according to Renaissance Capital, while many more are waiting for the climate to improve.

Yu had previously served at Yahoo as treasurer and at YouTube, helping negotiate the sale of the video site to Google in 2006. He had also briefly worked at Sequoia Capital as a venture capitalist.

Facebook's recruitment of Yu was part of a broader effort to bring experienced hands into the company, including former Google executive Sheryl Sandberg as chief operating officer. Relative old-timers at the 5-year-old company have been leaving over the past year, including co-founder and lead engineer Dustin Moskovitz; Adam d'Agelo, the chief technology officer; and Matt Cohler, an early executive.

Facebook has continued its phenomenal growth and is approaching 200 million users globally. Although it has struggled at times to capitalize on its user base through online advertising, it has made significant progress, according to a person familiar with the matter.

Facebook has turned in five consecutive quarters of profits, under the accounting formula of EBITDA, or earnings before interest, taxes, depreciation and amortization, according to the source. Revenue is expected to increase at least 70 percent in 2009; the company is expected to be cash flow positive in 2010.

Venture capitalists have poured money into Facebook in several rounds of funding. In 2007, Microsoft bought a 1.6 percent stake for $240 million, which valued the site at $15 billion.

Many investors now call that valuation excessively high.

E-mail Verne Kopytoff at vkopytoff@sfchronicle.com.