Monthly Archives - November 2018

You can't rely on Social Security

Relying on Social Security Is Like Playing Russian Roulette

For nearly 80 years the Social Security system in the United States has been paying benefits to retirees. Generations of Americans have grown up and gone to work in the expectation that the Social Security taxes they paid throughout their careers will be repaid with interest once they retire. But as demographic changes alter the makeup of American society and the American workforce, what was once seen as a guarantee by the government is now slowly fading away. Anyone [...]

Will the Fed cut short its interest rate hikes?

President Trump Continues to Attack the Fed: Will Powell Fold?

One of the more disappointing aspects of President Trump’s tenure is the evolution of his criticism of the Federal Reserve System. While candidate Trump rightfully criticized the Fed for artificially depressing interest rates, President Trump has morphed into attacking the Fed for raising its target federal funds rate. While he correctly identified the Fed’s political motivations for keeping interest rates low in the past, he now desires to benefit politically from the continuation of low interest rates. The big [...]

Bank of Japan

The Central Banking Bubble – Bank of Japan Assets Exceed GDP

When central banks first began to engage in quantitative easing (QE) policies during the financial crisis, those policies were harshly criticized by sound economists. The idea that printing money out of thin air to purchase worthless assets could somehow strengthen the economy and bring it back from the brink of destruction was an absurd one. All it could do was delay the inevitable day of reckoning, which as we see is just about to occur now that the stock [...]

6 things for investors to be thankful for

6 Things to Be Thankful About This Thanksgiving

It’s that time of the year again, time to get together with family, eat turkey, watch football, and think of all the things to be thankful for. As Americans, we often don’t realize how fortunate we are to live in such a prosperous country. We often complain about “First World problems” that people in less developed problems would kill to have, such as having our names misspelled on our cups of coffee at Starbucks. But at the end of [...]

Are doves at war with hawks within the Fed?

Is There a Rebellion Within the Fed?

One of the hallmarks of the Federal Reserve System in the modern era is the near unanimity with which it normally makes decisions. With the direction of policy being guided by the Fed’s chairman, the Federal Open Market Committee (FOMC) has rarely had members dissent from its decisions. When dissent does occur, especially when a number of members dissent, it makes headlines. And the leadership of the Fed almost always provides a united public face. But that may be [...]

How much money will you need to save for retirement?

How Much Do You Need to Save Each Year to Be Able to Retire Comfortably?

While every American dreams of retirement, the big question most people face is how much money they will need to save up in order to retire comfortably. Many financial planners advise at least a million dollars worth of assets which, thanks to the recent stock market boom, is not outside the reach of many Americans anymore. But others recommend even more money, $3 million, $5 million, even $10 million, in order to ride out any possible twists and turns [...]

Why do markets want easy money?

Why Do Markets Want the Fed to Continue Easing?

Read financial media today and you’ll find instance after instance of business executives and financial industry professionals worried about the Federal Reserve’s tightening of monetary policy. Mind you, this comes at a time when the target federal funds rate remains a hair over two percent, which is historically still very low. The Fed’s balance sheet, too, remains incredibly large, at over $4 trillion. So why is there such hand-wringing over the Fed getting monetary policy back to normal? The reason [...]

What will the new Congress hold for investors?

What Can Investors Expect From the New Congress?

With a new Democratic majority in the House of Representatives and Republicans maintaining the majority in the Senate, what can investors expect to see from the new Congress and how might new legislation affect them? This is the first time in nearly a decade that Democrats have held power in Congress, and it’s an unusual split that sees the House (and therefore the power of the purse) in the hands of the President’s opponents. One thing is almost guaranteed, and [...]

Protect your assets before it's too late

Now Is the Time to Protect Your Retirement Assets: Here’s Why

Thanks to the stock market’s performance since 2016 there are now more 401(k) millionaires than ever. It’s pretty heady stuff to think that you’re a millionaire, but many of these newly-minted paper millionaires don’t realize just how fragile their wealth can be. All it takes is a severe stock market crash and all that hard-earned savings and investment can disappear. Investors who know that take the necessary steps to protect their assets before a crisis hits. They see the signs [...]

Why are central banks buying so much gold?

Central Banks Buying More Gold Now Than in Years: What Do They Know?

Gold has been almost universally derided by governments in recent decades. Finally freed from the strictures of the gold standard, central banks and governments around the world have done their best to propagandize their people that gold is nothing more than a “barbarous relic.” For a while it seemed to be working, with gold prices trading in a narrow range for years. Many central banks even began to believe their own propaganda, selling off significant amounts of their holdings [...]