Steven Pham's Legal Blog

After the bells rang, the whistles blew, the confettis dropped, and the fan fair is over, what will happen to the economy?  The fact of the matter is, our country has been so stressed and the financial resources drained, that anything positive immediately after the election is over is propably not realistic.  What is realistic is that the mood of the country will change as we endorse the new president, whoever that may be, and trust that the newly elected president will be able to turn this country around. Moral and confidence around the world will also boost and international cooperations will increase.  I predict that within the immediate 6 months to one year after the new president takes over the ovel-office, the economy will turn, so will the financial and real estate market. 

The fact of the matter is, after the rain, there is always a rainbow.  In times like this, I have always tell myself that it had hit rock bottom, and there is no where else to go, but up!  So, this is the time to invest in the stocks, real estate, pt more money into your 401k, your IRA, and all you have to do is patiently wait to reap your returns.  At least, that is what I am doing. 

Now, I am no financial analyst and can only opine based on what I curently see in the real estate, financial market, and the banking industry.  With that being said, the state of economy today is largely as the result of the Fed’s failure to monitor, regulate, and properly manage the federal banking system and interest rates.  Leaving it to Ben Bernanke and George Bush to manage the nation’s economy had created the largest deficit since the cold war, an economy in shamble, the weak dollar, the real estate market in its bearest state, and the banking system that is on its knees.

The administration came up with the ingenious idea to providing a stimulous package, by giving back to the tax payers $175 billion earlier this year.  That money had gone to waste and did nothing to ease the state of the economy.  What it gave is false hope in which people spent more money that they actually recieved; and thus, going into more debts.  Now, Bernanke (promoting the democrats’ idea in Congress) wanted to provide a second stimulous package to boost the economy?  If Bernanke had any brilliant idea, he would have pull it out of his pocket by now.  Another balony stimulous boost will do nothing but put the country and its citizens into more debts.  Bernanke, it’s by you leave it to uncle Greenspan to teach you a lesson or two about the state of this country economy and how to resolve this financial crunch!

So you may ask, why does it matter if I were to get some money from Uncle Sam?  You should be worried about wasting money in which the government cannot afford, only later taxing the constituents (you) for the deficits.  Do the math, $80 billion on the war on terror, $175 billion on the first stimulous, $700 billion to bailout the financial industry and its fat cats; and now, how much more for a second stimulous?  Whose money is it that the feds are spending?  Who will be paying it back?  It is money from the sweats of millions of hard working middle-class Americans like you and I.

George W. Bush and Ben Bernanke, you can do the country some good and keep that boost in the fed’s account.  Stop providing false hope to the nation.  Your actions is a breach of your fiduciary duty to the people who elected you.

In Texas, the general consensus by the court is that a financial broker or investment advisor is a fiduciary.  Thus, a financial broker or adviser owe his or her client the fiduciary of care, the fiduciary of good faith and fair dealing (without conflict of interests), the duty to communicate with clients and keeping them informed, and most importantly, the duty of loyalty.

One method in which the court determines whether the financial advisor is a fiduciary is whether the client had a discretionary account with the advisor, whereby the advisor has some freedom in making the investment on the client’s behalf.  A discretionary account is when the customer has given the broker-dealer discretion buy and sell investments on the customer’s behalf.  It is usually easy to ascertain whether or not a customer’s account is a discretionary account, only because the rules of the NYSE and other stock exchanges require that the discretionary authorization be in writing.  NYSE Rule 408(a), NYSE Guide (CCH) P2408(a) (1990).  Thus, any document that authorizes the advisor to have discretion in managing the client’s account would create the fiduciary relationship.  In addition, it is not to say that a broker who holds a non-discretionary account does not owe clients fiduciary duties.  The duties, although less the standard of a “fiduciary” in a broad sense, are fiduciaries in nature.  They are as follow:    (1)       The duty to recommend a stock only after studying it sufficiently to become informed as to its nature, price and financial prognosis; (2)       The duty to carry out the customer’s orders promptly in a manner best suited to serve the customer’s interests;  (4)       The duty to inform the customer of the risks involved in purchasing or selling a particular security; (3)       The duty to refrain from self-dealing or refusing to disclose any personal interest the broker may have in a particular recommended security;  (5)       The duty not to misrepresent any fact material to the transaction, and; (6)       The duty to transact business only after receiving prior authorization from the customer.

It is fair to say that an investor takes extraordinary risk when invest in the current volatile market.  One can even say that in most cases in which a person’s portfolio falls is because of market conditions, despite the fact that the advisor made all necessary considerations to project the investor’s interests.  However, there are situations whereby an advisor or broker failed to act or acted in a negligent way that jeopardized and wasted clients’ investments.  Even worse, there are those that take advantage of unsophisticated investors and wasted the client’s investments for his or her personal gains. 

Because of the current economic recession and the financial crisis, many investors lost up to 1/3 of their investment over the last two months.  Ill-will inevitably will result among investors and brokers and blames will result from theses losses.  However, it is important to remember that most brokers and investors do perform their jobs diligently and with utmost care.  There are times, such as these that your investments may not yield results desired.  Nevertheless, if you are a broker or investor that is being sued, or if you are an investor who feels like your broker breached his or her fiduciary duty, please contact our Houston Security and Commercial Litigation Attorneys or our Long Beach Business Litigation Lawyers.

In this ever fluctuating economy, everyone has been anxious and worry about their investment and retirement accounts, especially those that watched their portfolio dropped as much as 30% last week, and rebound again at 10% this week.  Whether one should hold on to his/her investment depends on a variety of factors; of which, one’s age and income level are the essential question.  The fact of the matter is, if one waits long enough, the market will eventually rebound and investors would be able to recoup their losses; or make some serious money for those that are taking advantage of this once in a life time opportunity. 

The million dollar question, however, is whether the market has hit its bottom?  No one knows this question, and if I did, I would be rich.  Although I am not a financial advisor, and you should not rely on my blogs as such, this is the strategy in which I am sticking to.  Please use it as you see fit and to seek professional financial advice prior to taking a decision. 

The strategy, as many analysts suggested, is if you are at the age of retirement or in retirement, then you should be more conservative.  For example, if you are close to retirement, then you should just take out a sufficient amount for you to have a modest living over the next five years.  Your portfolio should be more conservative and a large percentage should go into CD’s and bonds.  The remainder should be placed in stocks and mutual funds. The opposite should be applied to those that are much younger and can afford time to rebuild asset, assuming the worse happens.  Younger investors should focus more on stocks and mutual funds and smaller portions in CD and bonds.   

Irrespective of your age, one important strategy would be to diversify your portfolios into different stocks, mutual funds, and different investment methods (CDs, 401K, IRA, Bonds, Stocks, and Mutual Funds).  Furthermore, if you were to invest in this volatile market, you need to be sure that this is a long term investment (5-10 years) to ensure that you have a better chance of coming out on top and the economy recovers from this current recession.  Lastly, you need to have patience in this market.  As stated above, no one knows whether the market had reached rock bottom after last week’s downfall.  Therefore, if the market dips below your current investment (or initial investment if you are jumping into the game at this time), then you should have patient to wait it out.  Again, long term investment is the key.  At some point, the market will rebound.  Like many things in life, what goes up must come down and vice versa. 

Again, I am not a financial analyst and you must seek professional advice prior to taking the next step.  If you feel that your broker or financial adviser had breached his or her contract, or breached his or her fiduciary duty, based on recent activities, please call our office at 281-210-0010 for our Houston office and at 562-590-7300 for our Long Beach office for assistance.  We will analyze the facts and determine whether you may have a meritorious action. 

About 2 weeks ago, I recieved in the mail something that gives most of us a shrug, a jury summon.  Trying not to think about it, avoiding it, I shoved it with all the bills, junk mails, and the like on my desk.  At 11:00pm last night, my wife had a wise idea that we need to pay our bills (brilliant!). Sorting through the bills that are dued, my wife said, “You have jury duty tomorrow.” So, begins my day in court as a juror. At 10:00am this morning, I arrived in court preparing to be selected out of jury summons, thinking that because I am a lawyer, no bright, experienced, respectable attorney would choose me to sit on the jury panel.  Along with 20+ other people, I sat around, reading the National Geographic Magazine and waiting for the judge to come out and assign us to a trial.  Around 11:30, the judge finally came out, giving us a long speech about how, as jurors, we help the system function efficiently.  At this point, I find it amusing simply because we have been sitting around for an hour and a half, nothing has been assigned to any of us; but yet, the system is “working efficiently.”  

After the speech, which took about 15 minutes, I decided to go out to the car, bringing in my lab-top to work.  I wanted to be more efficient than “the system” at its best efficiency.  When I arrived back to the jury room at 10 minutes untill 12:00pm, the clerk was dismissing the jurors for lunch and will reconvene at 1:05pm.  Currently, it is 12:34pm and I have 30 minutes to kill, after eating a quick, nasty lunch at the Houston Police Department’s cafeteria.  So, you are asking me, why am I writing this?  Well, first, I need to gribe about a day of my life in which I will not get back because I am doing my civic duty.  Second, this little exercise shows you the ineffectiveness of “the system” and why law suits are time consuming, seemingly endless, and most of all, why law suits are costly.  Although I would not say that all courts function in the same manor as the Houston Municipal Court, which is where I was summoned, it illustrates how inefficient the court system has become.   My philosophy has always been assisting my clients in resolving their business disputes, immigration issues, real estate disputes, contract disputes amicable and would only use litigation (the court system) if it is necessary.  Thus, if you have decided to file suit against a person, you must be sure that you have the patience, time, and resources to see it through.  If not, it would be a futile and expensive exercise that may not bring back positive outcome.  You must be resolute in your decision and move forward as discussed with our Houston Business Litigation Attorneys at Smith & Garg. 

The recent passage of the $700 Billion bailout by the U.S. government signals that this is a time of uncertainty.  While most people would agree that the bailout would help the financial industry from failing and going into bankruptcy, experts are not certain and disagree on how much it would help some of these failing banks.  Worse yet, many economist and political analysts do not think that the bailout would help home owners who are facing bankruptcies and foreclosures. 

The Act will allow the feds to buy up loans that are facing foreclosures, leaving banks with assets and revenue to make loans to more financially sound individuals and institutions.  In theory, this could work.  However, the Act will not buy up all bad investments, such as construction loans.  So, which banks are likely to fail while others are likely to be able to survivng this financial shake-ups?  Most likely, it would be local banks and mortgage companies who have limited assets and more likely to make riskier loans during the inflated, bull market in the real estate industry.

What does this mean to home owners and businesses?  If you are facing foreclosures, the recent passage of the $700 billion bailout will not help you.  If you are a general contractor, developer, and investors, the bill may help in the long turn, but many experts agree that the Act will not help in the immediate future.  Housing value will continue to decrease over the next year.  However, if you are one of the lucky investors who have a nest egg, or be able to get a loan, and ready to invest, this is the right time.  I suggest that regardless whether you are facing bankruptcy, foreclosures, or are those that are lucky enough to start investing, contact one of our Houston real estate attorneys, our Long Beach business and contract lawyers, our U.S. bankruptcy attorneys, or our U.S. credit repair attorneys for assistance during this time of uncertainty. 

For years, the right-winged conservatives have been screaming for the government to step-up enforcement of illegal immigration.  They attribute illegal immigration to the lack of jobs, claiming that jobs were taken by illegal immigrants who are willing to work for less by getting pay under the table.  To be fair, it is reasonable to assume that many undocumented aliens do accept jobs that pay less than the employer would have to pay for a U.S. residence or citizen.  However, whether that is a widely used phenomenon is yet to be determined.

What is clear, however, is that the number of illegal immigrants declined over the past few years.  The conclusion was based on a recent study, which was referred to in a recent Associated Press’s article.  While recent crack downs by ICE and removals may have caused fear in some illegal immigrants, the article attributed the decline due to the lack of low-skilled jobs, such as in the construction industry.  As the bearish economy slows down and enters into a recession, construction projects, especially in the residential construction industry, comes to almost a complete halt.  These low-skilled, low-paid jobs are often not desirable to many U.S. residence and citizens. 

The fact is whether the illegal immigrants take up “American jobs” are yet to be proven. One thing is clear.  As the illegal immigrant number increases, so is the U.S. economy.  Contrary, as the number of jobs decrease, and the economy slows down, so is the number of illegal immigrants.  Perhaps we all should stop worrying about who takes up “our jobs,” and concentrate on developing our own skills to be competitive.  Perhaps we should take into consolation that, when there is an increase in the number of illegal immigrants, it is an indication that our economy is vibrant and there are more jobs out there for everyone. 

Recently, I was asked to spear-head our firm’s marketing strategy and reassess our efforts to promote business.  This is a gargantuan endeavor because we have numerous websites, blogs, and hundreds of web pages, if not thousands, to review.  Although this would be a laborious task, and undoubtedly time consuming, it would not be as ambitious as my personal goals in this position.

You see, marketing is not just about looking for various ways to promote the firm’s images, branding, firm recognition, media ads., internet ads., and networking.  Marketing starts from within one’s organization.  To be able to convince the public, we must first be able to convince our employees and staffs that our firm is capable of providing quality legal services on behalf of the client, and that the firm cares for the overall welfare of its employees and clients alike.  Furthermore, employees also have the responsibilities to the firm and the employer and everyone must understand that a law firm, just as any other professional services organization, is a business; and because we are a business, we all share the responsibility to promote such business.

Thus, everyone has the responsibilities to market the firm, just as much as the firm has the responsibility to assist and to market the associates’ and the partners’ images. Until all of the above are accomplice, the media ads, branding, and internet marketing will not achieve the firm’s long-term goals and objectives.  On the other hand, if we do all of the above, do it well, and is consistent, the firm will be able to build trust, confidence, loyalty, and dedication from its partners, associates, staffs.  By working together, the firm will be recognized and appreciated by our clients, which will be reflected by the bottom line.  So, let us be brave, be bold, and be positive in moving forward with the changes and tasks in which we all equally bear.  God Speed! 

Not widely known, the USCIS implemented a new vaccination requirement starting last August 1, 2008 for female immigrant applicants outside the U.S. through Consular Processing and for those who seek Adjustment of Status in the U.S.  The new vaccination is part of the requirement based on the Illegal Immigrant Reform and Immigrant Responsibility Act (IIRIRA) which came into effect in 1996.  

Female immigrant applicants, ages 11-26, must now obtain cervical cancer vaccination, using a drug that was recommended by the Center For Disease Control & Prevention (CDC) last year, Gardasil.  IIRIRA required that any vaccination that is recommended by the CDC for U.S. citizens to vaccinate will be required by all immigrant applicants. The effect has wide-spread impact on the ability many immigrants to be able to file for an immigrant application and adjustment of status.  Gardasil is an expensive drug in which many immigrants simply cannot afford; mindful that there is already an extensive list of vaccinations, 14 to be exact, in which immigrant must show, such as measles, mumps, and meningitis. 

Of the 14 that are listed, 13 are communicable disease that could be spread through the respiratory system.  Cervical cancer, on the other hand, is a sexual transmitted disease.  At the cost of $360 for the 3 shots required for Gardasil, cervical cancer, vaccination, many immigrants simply cannot afford.  To put this into perspective, the average annual income for most developing countries is less than $300/year.  Where would an average immigrant find $360, just for Gardasil vaccination alone, to file their petition?  Has USCIS gone too far?  Are they just doing their job as required under IIRIRA?  Should IIRIRA be amended, as it inadvertently has negative affects for thousands of unintended “victims?” 

I am not a political person and usually do not meddle into politics.  However, recent Olympic events show the true characters of the Chinese government (Mainland Chinese government, that is).   With the reputation of the nation on the line, the Chinese government and their Olympic committee chose deceptions and frauds to host their first, and probably only, Olympics. 

Now, it does not take a genius to know and realized that many knockoff brand-names and boot-legged CDs and DVDs come from China.  In fact, one may even presume that these knockoffs and piracies are condoned by the Chinese government in the name of growths and profits.  However, it would be hard to imagine that the mainland Chinese government has the audacity and foolishness to fake many of the performances in their Olympics opening ceremony. 

    Anyone who watched the opening ceremony was stunned and marveled over the performances, using the masses, and spectacular fire-works.  However, the world soon realized that much of the performances and the televised broadcast was a series of deceptions.  First, the firework show on TV was partially computer generated, showing a large part of Beijing was lit up of fireworks.  In fact, much of the fanfare was generated by computers.  Second, we also realized that the former Olympian who gracefully pretended to “walk on air” around the bird-nest stadium was also a fake; and that in fact, much of it was also computer generated.  Now, it seems that the voice of the 9 year-old girl singing was also dubbed by another 7 year-old girl’s voice.  The reason, as explained by the General Music Designer, Chen Qigang, was “because we wanted to project the right image, we were thinking about what was best for the nation.”  That’s right!  The reason was because the Chinese committee wanted the world to see a girl that has a “perfect image” and a girl that has a “perfect voice.”  You see, the real singer, Yang Peiyi, is chubby and has crooked teeth; and so, they showed a cute little girl, Lin Miaoke, to “mimic” on stage.  In most parts of the world, it is called “lip-singing” and it would be considered as a deception, a lie, a fraud, a mockery of art, and an insult to the true artist, Yang Peiyi.    To add insult to injury, “Miaoke” is not a common Chinese sur name.  “Miao” (also known as Miao, Miao-tse, Miao-tsze, Meau, Meo, mo, miao-tseu) is a common sur name for a group of indigenous ethnic group of people that lives in Myanma, Thailand, Laos, Vietnam, and China.  So, nationality, she may or may not even be Chinese.  Ethnically, most likely cute little Lin Miaoke is not even Hans (the predominant and majority Chinese ethnic group.)  What does that say?

Does the Chinese’s explanation remind you of another group in the early 90’s?  That’s right; they are called “Milli Vanilli.”  Deceptions and frauds is what the performances were, games in which the Chinese government are so familiar with. “Girl, You Know It’s True!“  What is next?  The 208 drum performers were computer generated to look like there were 2008?  Nothing surprises me anymore!