On The New York Times' Upshot blog, Neil Irwin explains that Democrats' tax plans wouldn't affect just the uber-wealthy, but also many of the high-income professionals who populate the very states Democrats represent. He writes: Much of the Democratic primary race has focused on taxes aimed at the billionaire class — policies devised to reduce inequality and fund progressive goals on health care and education. But there’s also a less discussed tax increase in leading Democratic policy proposals that would affect not just a tiny sliver of the ultra-wealthy, but also millions of high-income … [Read more...]
Archives for November 2019
Trump Looking for “Big” Deal with China
President Trump is looking for deeper concessions from China before he rolls back existing tariffs and cancels scheduled new tariffs. David Lawder reports for Reuters: A “phase one” trade deal between the United States and China was supposed to be a limited agreement that would allow leaders from both countries to claim an easy victory while soothing financial markets. But it may morph into something bigger if U.S. President Donald Trump agrees to Beijing’s demands to roll back existing tariffs on Chinese goods, people familiar with the talks say. China’s commerce ministry said this … [Read more...]
Charging Stations in Public Places Could Be Loaded with Malware
Have you heard of Juice Jacking? The term is the name of a strategy used by hackers to load public USB charging stations with malware that can attack the devices of users trying to charge them. Allowing your electronic devices to be compromised by malware can be one of the most stressful and violating modern experiences. With more of your life than ever before attached to your phone, tablet or laptop, giving a criminal the ability to sift through your data and learn your most intimate details can be a nightmare. So how do you protect yourself? First, as Doreen Christensen reports in the … [Read more...]
Fed’s Rosengren Warns About Financial Stability
The loose monetary policy being pursued by the Federal Reserve has generated at least one internal critic, Federal Reserve Bank of Boston President Eric Rosengren. The Boston Fed chief is worried that measures taken to push the American economy toward 2% could risk distorting financial markets. Christopher Condon reports for Bloomberg: Federal Reserve Bank of Boston President Eric Rosengren warned his fellow monetary policy makers against putting financial stability at risk in pursuit of higher inflation. “I don’t think there’s a big cost to being a little below 2%,” Rosengren told … [Read more...]
Market Keeps Ripping Higher
You may have noticed it’s been a pretty good year for stocks. Good news, right? Well, it’s all good news until it’s not. With valuations this high, it’s important to gauge your future expectations. Case in point: “When valuations were this high in 2004 and 1997, the next decade delivered after-inflation gains of 4.5% both times, despite enormous market crashes along the way," writes James Mackintosh in the WSJ. The question is, to me at least, how many stock investors were able to stick around and patiently stay invested when things got nasty? What I want you to consider in the … [Read more...]
U.S. Consumer Shrugs Off Tariffs to Power Walmart to Five Year Growth Streak
Sarah Nassauer reports in The Wall Street Journal that American consumers are showing no signs of being held by tariffs, as they push Walmart sales to a five-year growth streak. She writes: American consumers showed no signs of belt-tightening in sales results from Walmart Inc., offering comfort to retailers worried about fallout from the trade war and the health of the global economy as the holiday shopping season nears. Walmart said its U.S. comparable sales, those from stores and websites operating for at least 12 months, rose 3.2% in the period ended Oct. 25, marking a five-year streak … [Read more...]
The Final Nail in the Coffin for Mutual Funds
The mutual fund industry has been facing headwinds for years. First, the industry became too big. So dominant were the biggest funds, they couldn’t invest without moving the market themselves. The next problem for mutual funds was the advent of the ETF. ETFs hollowed out the high-fee actively managed equity fund industry. I wrote about these problems here in November of 2006: I write often that the majority of mutual funds offer no compelling reason for investment. Here’s a double shocker for you. Of the top-ten largest equity mutual funds, seven come from one family. How could one … [Read more...]
The Truth Behind The Very Hungry Caterpillar by Eric Carle
You know the name Eric Carle if you have kids or grandkids. His books were a big part of our book collection when my kids were little. That’s why this article caught my eye. And how moving I found this quote from the article about a book I read out loud a thousand times: The Very Hungry Caterpillar. Jeffrey Trachtenberg reports on Carle's view of why The Very Hungry Caterpillar has been such a hit with kids for so many years. He writes: In a YouTube video released in January, Mr. Carle said it took him a long time to understand why the title has sold so well before he concluded that “children … [Read more...]
Why Bonds Always Matter to You
I want you to look at my chart above, Bonds vs. Stocks. What I’ve done for you is offer a look at the Fourth Quarter of last year. Of note, the Fed was coming off a series of rate increases and had begun lowering rates in August. Additionally, the Republicans lost the House to Democrats in November. Talk about uncertainty in the markets. The black bars show how bonds rallied. The blue bars show how stocks cratered. This micro example shows you the power of counterbalancing. You have seen time after time at this website how I want you to focus on your risk first and foremost. And this is … [Read more...]
Liz Warren’s 158% Tax Rate
Remember, your key takeaway here is that millionaires will become the new billionaires if Warren has her way. Here’s how her tax rates reach 158%. Richard Rubin reports in the WSJ: Potential tax rates over 100% could result from the combination of tax increases the Massachusetts senator proposes for the very top tier of investors. She wants to return the top income-tax rate to 39.6% from 37%, impose a new 14.8% tax for Social Security, add an annual tax of up to 6% on accumulated wealth and require rich investors to pay capital-gains taxes at the same rates as other income even if they don’t … [Read more...]