Monthly Archives - September 2019

China’s Massive Money Creation Is a Threat to the World Economy

So much focus has been placed on China’s economic growth and its role as a major trade partner, but relatively little focus has been placed on how that has come about. China’s economic growth is in large part due to money creation, meaning that its enormous economic growth is ultimately unsustainable. Some of that monetary creation has been the result of importing inflation from the United States, while much of it has occurred in recent years as China tries [...]

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How Should Millennials Invest for Retirement?

There’s a lot of retirement advice out there that is just plain dated. Much of it is focused on those who are already in their 40s and 50s and have sizable nest eggs already. And even more of it is written from the perspective of those who came of age during the stock market heyday of the ‘80s and ‘90s, in which stock markets were seeing 15% average annualized gains and you would have had to actually work to [...]

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The Fed Is Doing Something It Hasn’t Done Since the Financial System Nearly Crashed in 2008

The Fed’s rate cut last week was supposed to operate like clockwork. Everyone expected the 25 basis point cut, it was merely the next step in what will likely be a continuing series of cuts, and there was no anticipation of anything unusual. Yet what ended up occurring has rattled markets and left many observers wondering how weak the economy really is. Unless you’re a hardcore observer of financial markets, you’ve probably never heard of overnight repo markets. Those are [...]

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401k plan by age

How Much Should I Have in My 401(k): Amounts by Age

The dream of a comfortable retirement is one that motivates many an American worker. But like many other things in life, the definition of comfortable retirement is one that varies from person to person. For some, retirement means sitting on the couch watching TV and drinking beer. For others, it means living an active life full of sports and travel. Each of those lifestyles brings with it the need for different levels of financing. Most Americans today rely on a [...]

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Fed Cuts Interest Rates as Expected, But Markets Go Nuts

There weren’t really any surprises last week when the Federal Open Market Committee decided to cut its target federal funds rate another 25 basis points, to a target of 1.75% to 2.00%. That had long been expected and even priced in by many investors. But there were two anomalies that bear mentioning. The first is that there were three dissenting votes to the FOMC’s policy announcement. Those dissenting votes this time around were St. Louis Fed President James Bullard, who [...]

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Insiders Are Fleeing Stock Markets: What Do They Know That You Should Too?

When investing in markets, it’s sometimes a good idea to look at what other people are doing. Sometimes that take the form of looking at what they’re doing and doing exactly the opposite, like taking a short position on a hot stock because it’s fundamentally undervalued. Other times that takes the form of watching closely as those in the know make moves in their own self interest. The latter is what we’re seeing today, as corporate insiders have been [...]

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Negative interest rates are coming

What Effect Will Negative Interest Rates Have on Your Retirement?

The past decade has seen interest rates at historically low levels for the longest period of time ever. The effect that has had on the economy has been enormous, with governments, corporations, and households all taking on massive amounts of debt in order to take advantage of low borrowing costs. But despite interest rates being so low, economic performance has been subpar. The economic recovery in both the United States and Europe has been one of the weakest in history. [...]

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401k text stacked on coins

How Much Should I Contribute to My 401(k)?

Saving and investing for retirement isn’t something that many people are familiar with until they’re thrust into the workplace and forced to make investment decisions for themselves. No one takes classes on retirement planning, it isn’t taught in high school, and even most parents don’t sit down with their children and go through the essential elements of saving and investing for retirement. That can make the actual decisions that go into retirement planning very daunting. Some of the most common [...]

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The US National Debt in Perspective

The United States government’s national debt stands today at an astronomical $22.6 trillion. Everyone knows that’s a huge amount of money, but the sum is so large that it just boggles the mind and can be difficult to conceptualize. So here are a few ways of thinking about the national debt that will put it into perspective to help you realize just how large it is. National Debt vs. GDP The national debt now exceeds the entire gross domestic product of [...]

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Bank of America Makes the Case for Buying Gold

There’s an increasingly compelling case that the gold market we’re seeing right now is in the very early stages of a break-out bull market that will rival the performance gold saw from 2008 to 2011. That bull market saw gold rise from under $1,000 to nearly $2,000 by its peak. And with gold starting its bull market run at nearly $1,300 this year, by the time this market reaches its peak we should see gold over $2,000, with $2,500 [...]

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