Poison Annuities on Your Retirement Fund Menu?
The Executive Office of the President’s Council of Economic Advisers wants you to buy annuities in your retirement account. The proposal, released this month, “Supporting Retirement for American Families,” should be titled “American Families Supporting Insurance Companies.” At the heart of... Read the full story
Outliving Your Money
In this 0%-interest-rate environment, public pensions like Rhode Island’s are using an assumed rate of return of 7.5%. If and when that estimate goes unmet, it’s up to taxpayers to make up the difference. It’s preposterous that public pensions are assuming a 7.5% rate of return. The only way they’ll... Read the full story
We Are All Subprime Now
Over the last 10 years (since year-end 2002), profligate spending in Washington has resulted in a staggering $6.9-trillion increase in debt held by the public. That’s $22,000 for every man, woman, and child in America. A family of four is looking at an $88,000 increase in their debt burden. How generous... Read the full story
Who’s Custodian for Your Money?
You can see the hubris. As the bankruptcy of MF Global unfolds, customers are still looking for their money. That money should have been segregated and not part of the bets the firm was making with its own money. So far, $1.2 billion in client funds is missing. Where did it go? From Vanity Fair’s... Read the full story
The Dollar Game Is Rigged
You’re getting less than $0.20 on a 1971 dollar. You can see the decline in my chart. And based on the Fed’s rock-bottom interest-rate policy, there’s no reason to believe it’s getting any better. That’s why you want to study the Wall Street Journal op-ed by David Malpass. He writes: Wednesday’s... Read the full story
Don’t Let This Mutual Fund Mistake Cost You Thousands
What mutual fund mistake am I talking about? This mistake is so common, chances are you have committed it yourself—before you became a savvy, successful investor, of course. If you have ever purchased a mutual fund solely on the basis of past performance, you have made this mistake. Buying yesterday’s... Read the full story
Future Dividends, Coupons, and Principal
Your purchasing power is your lifeblood in retirement. On my office credenza is The Theory of Investment Value by John Burr Williams, first published in 1937. Chapter five is titled “Evaluation by the Rule of Present Worth, Section I. Future Dividends, Coupons, and Principal.” Burr writes: [D]ividends,... Read the full story
A Recovery in Housing
Has the long anticipated recovery in housing finally arrived? The latest round of economic data on the housing market points toward improvement. On Wednesday, the National Association of Home Builders (NAHB) released their monthly home builder confidence index. The NAHB/Wells Fargo Housing Market Index... Read the full story
Owning the Best Performers
In its quarterly funds report printed on January 9, The Wall Street Journal lists the 45 largest stock and balanced funds by assets. The best performers of this group for 2011 were a gold ETF, SPDR Gold (GLD), up 11.2%, and a balanced fund, the Vanguard Wellesley Admiral shares (VWIAX), up 9.7%. The... Read the full story
Random Short-Term Markets
There’s no shortage of financial soothsayers out there selling their wares. Some of their sales tactics are relentless. I know because my customers tell me. I also read until my eyes feel like they’re about to fall out of my head. The sheer magnitude of news and financial data to dig through daily... Read the full story
