Gary D. Halbert

  • Investment Scams Are Alive and Well

    Introduction During the 6+ years of the new millennium, we have experienced the end of one of the longest bull markets in history, a devastating bear market, a brief rally, and more recently a "sideways" period where the markets seem to be just...
    Posted to Forecasts & Trends by Gary D. Halbert on 09-05-2006
  • Obama On Course To Double National Debt

    Based on the Obama administration's own spending forecasts, the US national debt is projected to double over the next 10 years. Currently at over $11.4 trillion, the national debt is projected to balloon to at least $22.5 trillion over the next 10 years, according to the non-partisan Congressional Budget Office. The CBO now forecasts the fiscal 2009 budget deficit at a record $1.845 trillion alone, with another deficit of $1.4 trillion in fiscal 2010. If our national debt in fact doubles in the next 10 years (and it could more than double), this will be bad news for the US dollar and interest rates, which in turn is bad news for stocks. As you might expect, the liberal media is not talking about these new debt numbers, so I will lay it all out for you this week. Feel free to pass this week's E-Letter on to others - we need to get out the word!...
  • Will the US Dollar Lose "Reserve Currency" Status?

    The US dollar has been in a multi-year decline since peaking in 2001. While there was a temporary 'rush to safety' rebound in the dollar due to the global credit crisis in 2008, the dollar has resumed its long-term downtrend as of early March of this year. Now, more and more forecasters are suggesting that the dollar may lose its global "reserve currency" status if it continues to decline. Some are even calling for the establishment of an all-new global currency to replace the dollar entirely.

    This week, we will explore how the US dollar came to become the world's reserve currency and how difficult it would be to replace the dollar as the reserve currency, or replace it entirely with a new global currency. We will look at the major price trends in the dollar over the years and try to put the current decline into perspective. I will make the case that the US dollar will remain the global reserve currency for at least several more years. It should make for an interesting letter, so let's get started.

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  • Cap-and-Trade: Bad For The Economy & Us

    On June 26, the Democrat-controlled House narrowly passed sweeping legislation that calls for the government's first limits and taxes on carbon emissions, the so-called "Cap-and-Trade" bill that President Obama has insisted on. Experts on both sides of the issue, including President Obama, agree that Cap-and-Trade will result in higher energy prices, and that means higher prices for fuel, home heating and cooling and many other things we buy from food to cars to movie tickets, etc., etc. Cap-and-Trade will be a disaster for the economy. Hopefully, the Senate will not pass this bill, especially in light of news that the EPA has suppressed a major new study which argues that global warming in NOT happening, and recommends against Cap-and-Trade. This may be one of the most interesting and important E-Letters I have ever written... But it will likely make you angry!...
  • The Democrats' Plan To Highjack Your 401(k)

    Well, election day is upon us. While the mainstream media would have us believe that the results are a foregone conclusion in Obama's favor, recent polls have indicated a narrowing of his lead over McCain in some battleground states. Obviously, we'll all just have to wait and see how the votes turn out. In the meantime, I think it's important that we conservatives notice some of the trial balloons that are being floated by the Democratic leadership. One recent proposal that would eliminate the favorable tax treatment of 401(k) plans shows us that, no matter how the election turns out, we have plenty to fear from the liberals who are already in office....
  • Insurance Companies - The Next Shoe to Drop?

    Over the last year, the financial media has focused primarily on the major banks and their solvency issues. We have heard relatively little about the major insurance companies, which were not eligible to participate in federal bailout programs such as the TARP. As I will detail in the following pages, most of the major insurance companies are in financial trouble due to the recession and the credit crisis; some major insurers are large players in derivative instruments such as Credit Default Swaps and Collateralized Debt Obligations which have gone bad. In addition, many property and casualty insurers were dealt a blow by the natural disasters (hurricanes) that occurred last year. Some in the industry predict that if we have another bad hurricane season this year, a number of the nation's largest insurers will go out of business entirely.

    The publicly-traded insurers will be releasing their required 10-Q financial statements for the 1Q in the next few weeks, along with their 10-Ks for all of 2008. I am told that these reports are going to look very negative on balance, and this could be quite disturbing to the financial markets including stocks. As we go along, I will tell you specifically what to look for in these financial reports to judge the credit worthiness of your particular insurer. This may be one of the most important and timely E-Letters I have published....
  • The End of America's Financial Independence?

    President Barack Obama recently set the wheels in motion to render the ultimate control of our large financial institutions, large insurance companies, large hedge funds and quite possibly our financial markets as well, to a foreign entity. A new international regulatory agency was created at the recent G-20 Summit in London, and all G-20 countries signed onto it. Sadly, you probably have not heard a word about it until now. Prepare to be outraged as you read what follows....
  • Bernie Madoff - How To Avoid A Ponzi Scheme

    This week, I'm going to address the $50 billion "Ponzi Scheme" allegedly masterminded by Bernard Madoff. The question we receive most often is how a Wall Street icon like Madoff got away with such a huge fraud for a period of decades? As you'll see in this week's E-Letter, the answer lies in a structure that lends itself to conflicts of interest, plus a lack of regulatory scrutiny. The lesson to be learned by all investors is to be sure to conduct due diligence on any money manager, no matter how famous they may be. I'll also review the many steps we go through in our due diligence process before recommending a money manager....
  • Best Critique of Obama I’ve Ever Read

    The holidays sneaked up on me faster than usual this year, what with a couple of extra business projects that required a lot more time than I expected over the last few months. Given a number of year-end deadlines, I have elected to reprint an excellent article today by Peter Ferrara that is perhaps the best critique of President Obama that I have ever read. If you are an Obama fan, you probably don’t want to read this; on the other hand, maybe you should.

    Ferrara succinctly examines Obama’s upbringing, his early professional life, his liberal ideology, his ascendency into politics, his becoming President of the United States and his policies since occupying the White House. This is a very interesting and insightful read, especially in light of the challenging economic and financial times we find ourselves in.

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    Posted to Forecasts & Trends by Gary D. Halbert on 12-27-2011
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  • The Largest Tax Increase in US History

    Back in 1948, President Harry Truman nicknamed the 80th Congress the 'do-nothing Congress.' Today, we sometimes find ourselves wishing that we could return to the days when Congress was accused of inaction. Unfortunately, the stage may now be set for that wish to be granted, but the consequences will be far from favorable. By allowing the Bush tax cuts to expire, Congress could levy one of the largest tax increases ever, all by just doing nothing.

    While President Obama and the Democratic leadership claim that they want to keep all of the Bush tax cuts in place for everyone making under $250,000 per year, they also know that they are going to build up huge budget deficits unless they find ways of generating some tax revenues. With cap-and-trade legislation and its expected tax revenues all but dead, the Dems are going to have to figure out some other way to pay for their march toward socialism.

    The expiration, or 'sunset', of the Bush tax cuts could provide the necessary tax revenues they seek and all without having to cast a vote in favor of a tax increase. This week, I'll discuss the possible effects of a huge tax increase during a fragile economic recovery as well as the possibility that Congress may just sit on their hands and do nothing in order to fill their insatiable need for tax revenues.

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  • Obama's Tax Policy: None Dare Call It Welfare

    We have recently learned the details of President-elect Obama's massive income tax overhaul, and the plan is much worse than we had anticipated. Obama's liberal tax plan would give annual tax rebates to millions of Americans who already pay NO income taxes whatsoever. Giving government tax rebate checks to those who already pay zero income taxes is nothing short of expanding the welfare state (or socialism as I prefer to call it). Worst of all, if Obama gets his massive tax plan approved, it will mean that a majority of Americans will pay little or no income taxes, while the so-called "wealthy" will foot the rest of the bill. If we reach such a point, there will be little to no chance of true tax reform for the foreseeable future. Read what follows very carefully....
  • Impact of the 2010 Census

    IN THIS ISSUE:

    1.  The Results of the 2010 Population Count

    2.  The 2010 Census: Winners and Losers

    3.  Low Tax States Big Winners in Census

    Introduction

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    Posted to Forecasts & Trends by Gary D. Halbert on 12-28-2010
  • Will Baby Boomers Wreck the Market? (The Sequel)

    Almost six years ago, I wrote an article about whether the Baby Boomers would crash the stock market when they retired. That dated article is still among the most viewed by visitors on our website even though a lot has happened in the financial world since it was written.

    The premise is that as Baby Boomers retire, they will cash in stocks in favor of lower-risk investments, thus tanking the stock markets. In my earlier E-Letter, I analyzed this claim and concluded that retiring Baby Boomers were not likely to negatively affect the stock markets in a major way for a variety of reasons.

    However, since writing that article in August of 2006 we've experienced a global financial crisis and major bear market in stocks. Would my advice be the same today?

    Because of the popularity of this topic, I am going to revisit the idea that retiring Baby Boomers may crash the stock market. Now that the oldest Boomers are actually retiring, it will be interesting to see if the answer is any clearer now than in 2006.

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    Posted to Forecasts & Trends by Gary D. Halbert on 04-10-2012
  • Stratfor: Odds of War with Iran Spiking

    In just the last few weeks, we have learned several disturbing new things about Iran's nuclear capabilities. First, we discovered that Iran has a large secret uranium enrichment facility inside a mountain south of Tehran that we didn't previously know about. Second, shortly thereafter, the International Atomic Energy Agency (IAEA), the U.N. nuclear oversight group, said that Iran is much more advanced in its nuclear program than the IAEA had thought previously. According to the report, Iran now has all the data needed to design a nuclear weapon.

    Third, was a revelation in the first days of October by the Times of London which reported that Israeli Prime Minister Benjamin Netanyahu traveled to Moscow on September 7 to charge that Russian scientists and engineers are working directly with Iran on its nuclear weapons program. This intelligence suggests that Iran may be much further along in developing nuclear weapons than the international community previously believed.

    To give us insights on these latest revelations about Iran and its nuclear ambitions, we turn to our good friends at Stratfor.com this week. Please read what follows very carefully.

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  • Dalbar Update: Investors Still Lagging The Market

    The Dalbar organization recently completed the 15th update of their landmark Quantitative Analysis of Investor Behavior (QAIB) Study. As long-time readers know, I have often quoted statistics from these annual updates that show average investors receive inferior long-term returns when compared to gains posted by stock and bond mutual funds. The reason, by and large, is that investors switch from fund to fund chasing hot returns. In doing so, they often end up with low returns, and sometimes even losses. Most interesting, however, is that the 2009 Dalbar QAIB Study update finally comes to the realization that traditional buy-and-hold approaches do not work, and that investors continue to panic and trade out of stocks when losses run high. In other words, emotions often trump rational investor behavior. This week, I'll update you on the most recent Dalbar Study findings, and also discuss our solution to emotional trading that we discovered back in 1995.

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