February 2011 - Forecasts & Trends

Forecasts & Trends is much more than just investment blog posts. You need to know the "big picture;" you need to have a "world view," especially in the post-911 world; and you need more information than ever before to be successful in meeting your financial goals. Gary intends to help you do just that.

Forecasts & Trends

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    • Obama’s New Budget - He Just Doesn’t Get It!

      A Gallup poll taken the week before Obama announced his 10-year budget proposal found that 68% of Americans disapprove of Obama’s handling of federal deficits, the highest disapproval rating ever recorded on this particular question. Put differently, over two-thirds of Americans say they want federal spending cut, not increased.

      Yet on February 14, just days after the Gallup poll, President Obama unveiled a 10-year budget proposal that will add at least $9.4 trillion to our already $14.1 trillion national debt. It was the largest 10-year budget proposal on record. Obviously, Obama did NOT get the message that voters sent in the mid-term election or the latest Gallup poll noted above.

      The question is, what could have Obama been thinking? Why would he propose adding almost $10 trillion to our national debt at a time when over two-thirds of Americans want federal spending reduced? Does he want to be a one-term president? I have a theory as to why he did this, and it may surprise you. That’s why you’ll definitely want to read this week’s E-Letter.

    • On the Economy and Investment Dos and Don’ts

      There's an old riddle about how far you can walk into the woods. The answer is "half-way," since after that point you're walking out of the woods. Recent economic reports remind me of this riddle in that they seem to be indicating that we're walking out of the woods but there are still a lot of trees in our way. In this week's E-Letter, I'll discuss the positive signs that the economy may just be coming back to life. However, I'll also mention some of the not-so-good economic news that lets us know that we're definitely still in the woods, and may be there for some time.

      After that, I'm going to respond to some "instant advice" that I recently found in a financial publication. I always cringe when I see articles in financial magazines and on websites counseling readers to do this or that with their investments without knowing all of the underlying facts and circumstances that are unique to each person. I think you'll find it to be interesting reading, especially if you find yourself in one of the situations described.

    • More on the Financial Literacy Crisis

      The Financial Industry Regulatory Authority (FINRA) Foundation recently released a state-by-state study showing how financial literacy varies by geographical region. Unfortunately, even the states that have the best scores that are disappointingly low. If this sounds familiar, the results mirror the findings of a study that I highlighted last summer showing that financial illiteracy is rampant in America, especially among young people.

      This week, I'm going to update you on the state of financial literacy in the US and also supply some resources for those who are not learning about financial matters in school. If you have adult children, grandchildren or other family members who may be lacking in financial knowledge, I urge you to send this E-Letter on to them and encourage them to take the test. Their financial future just might depend on it.

    • On the Speech, the Economy & Runaway Debt

      This week, I will touch on several topics.  We begin with a few thoughts about President Obama's State of the Union address last week that you might have missed.  Most notably that he was roundly criticized by the Washington Post, one of the more left-wing papers in the country.  Following that discussion, I will analyze a new report which discusses why Obama's $800+ billion stimulus program did not work as expected.  Next, we will look at the Congressional Budget Office's latest forecast for the fiscal 2011 budget deficit.  Think $1.5 trillion!  And finally we will look at the new makeup of the Fed Open Market Committee, which changed at the first of this year, and what that might mean for monetary policy going forward.  Hopefully, all of this will make for an interesting letter this week.