Savings Rate Lowest In A Decade, Credit Card Balances Soar
Over the last several months, I have written often about how the US economy has strengthened significantly since the disappointing 1Q of last year. This time last year, most forecasters felt the economy would do well to grow by 2% in 2017.
Stocks Definitely Overvalued - Government Shutdown Looms
I don’t make market predictions very often. Normally, I leave those decisions to the professional money managers we recommend at Halbert Wealth Management. However, some recent developments have made me very concerned that the US equity markets are at high risk for a serious downward correction just ahead.
Will Our Strong Economy Spike Inflation in 2018?
As you know, a lot of predictions are made this time of year – about the economy, the markets, interest rates, inflation, etc. Some forecasters are predicting that 2018 will finally be the year when inflation takes off and returns to higher levels. However, some of these same prognosticators have been saying the same thing for the last several years.
China Not To Overtake US Economy Until 2032
Our stable of investment strategies at HWM has never been more diversified than it is today. In the last few years, we have significantly expanded the scope of the investments we recommend, including several successful strategies that do not involve stocks or bonds.
The Economy: Holiday Spending Strongest in Years
There’s so much to talk about in this week before Christmas it’s hard to know where to start. The economy continues to gain momentum. Last week, the Atlanta Fed revised its GDPNow forecast from 2.9% to 3.2% for the 4Q.
Lots of Good News in the November Jobs Report
The Fed Open Market Committee (FOMC), which sets interest rate policy, is meeting today and tomorrow. It is widely expected that the FOMC will hike its Fed Funds rate by another quarter-point when it releases its policy statement. In fact, the only surprise will be if it doesn’t.
Thoughts on GOP Tax Cuts & China's Faltering Economy
I veer from our usual roster of topics this week to bring you an update on China and its prospects for continued hot economic growth, or lack thereof. China is the second largest economy on the planet, behind the US, and many (if not most) Americans believe that it won’t be too long before China overtakes the US as the largest economy in the world.
Household Debt Rises to New Record of $13 Trillion
A new report from the Federal Reserve Bank of New York last week found that US household debt hit another record high in the 3Q of almost $13 trillion. The largest increases came in student loans, auto debt and credit cards. I’ll share the details with you just below.
Can the US Economy Sustain 3% Growth? The Answer is Yes
The US economy just turned in its second consecutive quarter of 3% growth in Gross Domestic Product, to the surprise of most forecasters and the mainstream media. This despite the negative effects of two major hurricanes hitting the southern US late this summer.
Why We Need New Leadership at the Federal Reserve
President Trump is finalizing his decision on who will head-up the Federal Reserve when current Fed Chair Janet Yellen’s term is up in February. He also needs to appoint another person to fill the now vacant Fed Vice Chairman spot due to the resignation of Stanley Fischer earlier this month.
Trump Packing Federal Courts With Conservative Judges
While the mainstream media remains obsessed with President Trump’s tweets and other controversial statements, the Commander-in-Chief is quietly packing the federal courts with conservative, originalist judges who are not only very smart but also relatively young.
War With North Korea Could Spark New Bear Market
The United States is increasingly being provoked toward a war with North Korea by its seemingly insane young leader Kim Jong-un. Not only has Jong-un acquired nuclear bomb capabilities much faster than US intelligence sources had estimated for years, he has also recently developed intercontinental ballistic missiles (ICBMs) capable of reaching US soil.
America's Middle Class is Making a Strong Comeback
For most of this year, I’ve had a sense that the American middle class is increasingly growing, and that wages/incomes are increasing more than the Labor Department reports. I have been saving articles upon articles on this subject and was planning to extract the highlights and summarize them for you in the next week or two in these pages.
Fed in a Real Quandary - No Good Policy Options Now
The Fed remains committed to raising short-term interest rates at least one more time this year, most likely at the September policy meeting as I will discuss below. The Fed also wants to start reducing its massive $4.5 trillion balance sheet this year, but doing so in the past has almost always led to a recession.
Imagine A World Without Cash - A "Cashless Society"
On July 12, credit card giant VISA announced that it will soon offer selected retailers $10,000 to stop accepting cash. No one seemed to pay much attention. The announcement received relatively little coverage in the press. Should it have? Yes!
More & More Americans Having to Work Past Age 70
Nearly one-fifth (19%) of Americans age 70 to 74 were still in the workforce as of the end of June, according to the latest jobs report from the Labor Department on July 7. Some are working because they are healthy and enjoy their work. Most, however, are still working because they haven’t saved nearly enough for retirement.
Federal Spending to Top a Record $4 Trillion in FY2017
Both the Congressional Budget Office and the White House Office of Management and Budget announced last week that federal spending will top $4 trillion for the first time ever in fiscal 2017, which began on October 1, 2016 and ends on September 30.
Record Six Million Unfilled Jobs in US-What's the Problem?
The US Department of Labor told us in June that there were apprx. 6.0 million open (unfilled) jobs in America, a record high. The Labor Department also told us that there are apprx. 6.8 million unemployed Americans who are actively looking for work.
One-Third of Millennials Are Living With Parents
As the father of two Millennials (ages 27 and 25), I pay a great deal of attention to articles and studies on this largest generation of 75.4 million Americans. Given the sheer size of this generation and its vast effect on the economy for decades to come, we should all be paying attention to trends within this massive group.
Fed Plans To Trim Its Massive $4.5 Trillion Balance Sheet
Most investors understand the implications of the Fed raising (or lowering) interest rates. After lowering short-term interest rates to near zero in late 2008, and keeping them there for eight years, the Fed is now committed to “normalizing” short-term rates by raising the key Fed Funds rate multiple times over the next couple of years.
Odds Rise For "Inverted Yield Curve" & New Recession
The Fed policy committee will almost certainly raise the key Fed Funds rate by another 0.25% tomorrow. Minutes from the early May Fed meeting indicate that the Fed sees the 1Q economic weakness as temporary, and the odds for a rate hike tomorrow are above 90%.
Household Debt Hits New Record High, Stocks Stumble
The Federal Reserve Bank of New York reported last week that US household debt reached a new all-time high in the 1Q of this year. The new report also included some troubling internal metrics, not only on the overall household debt levels but also with regard to the level of delinquencies.
The Fed/Central Banks' $13 Trillion Gorilla in the Room
The US Federal Reserve, the European Central Bank and the Bank of Japan alone have over $13 trillion in quantitative easing assets on their balance sheets. The Fed recently hinted that it would like to start reducing its QE assets this year if possible.
44% of US Households Don't Pay Any Federal Income Tax
Income Tax Day came and went last week without a great deal of fanfare. Most Americans who owed income tax to the government for 2016 either filed their tax returns and paid their bill to Uncle Sam last week, or filed for an extension and paid their estimated tax, as many do each year. Nothing new there.
Big Retailers Closing Stores At Record Pace In 2017 - Why?
Big Box retailers and many other popular chain stores – including Sears, JC Penney, Macy’s, Payless, Sports Authority, American Eagle, Radio Shack and many others – are closing their stores at a record pace so far this year.
Government Shutdown Looming? Not Anytime Soon
Over the next couple of weeks, the mainstream media is likely to deluge us with warnings that the government could shut down at the end of this month. According to the Treasury Department, that’s just not true.
Private Sector Productivity Fell In 2016 - Worst Since 2009
One key measure of US economic productivity actually declined in 2016 for the first time since the depths of the Great Recession in 2009. The amount of goods and services produced, versus the total inputs of labor and capital to produce them, declined slightly last year for the first time in seven years.
The Fate Of The Federal Reserve Is Now Up For Grabs
The mainstream media is intently focused on the fate of President Trump’s Supreme Court nominee Neil Gorsuch. Judge Gorsuch is imminently qualified to serve on the Supreme Court and, if confirmed, he would fill the seat of the late conservative Justice Antonin Scalia.
Decades-Long "Income Gap" Is Finally Reversing
The mainstream media loves to talk about the so-called “income gap” – the fact that incomes have been rising faster for the rich than the poor in America for decades. Yet new independent reports find that this trend has reversed in recent years.
America Continues To Lead the World in Wealth by a Longshot
Today, we’ll take a look at some very interesting data released by the World Bank last month, which shows that the United States still dominates the global economy by a wide margin. The US produces almost one-fourth of all global GDP, and has been at that level or higher for over two generations. This is remarkable.
Can Trump's Economic Plan Jump-Start GDP Growth?
President Trump promises that his economic plan, if enacted, will result in 3-4% annual GDP growth. Yet I get the feeling most Americans don’t understand Trump’s economic plan. Maybe that’s because the mainstream media has criticized it at every turn, even though similar plans have jump-started the economy in the past – think Ronald Reagan.
US Economic Freedom Index Plunged Over Last Eight Years
We touch on several bases today. We begin with the Heritage Foundation’s annual Economic Freedom Index, which plunged during the eight years of the Obama presidency. From there, we look at some recent economic data which is quite encouraging overall.
CBO: Jobless Rate To Fall & Wages To Rise Through 2018
A new report from the Congressional Budget Office (CBO) predicts that the US unemployment rate will continue to fall through 2018. The same study predicts that growth in hourly wages will increase significantly this year and next. I’ll give you the details on this uplifting report as we go along today.
Emerging Nations Facing a Looming US Dollar Crisis
Over the last eight years, with US interest rates at rock bottom thanks to the Fed, the rest of the world has borrowed a huge amount of dollars – about $4 trillion according to the Bank for International Settlements. During that same time, the US dollar has soared against a basket of foreign currencies.
Small Business Optimism Soars to Highest Level Since 2004
Small businesses and entrepreneurs have had a rough time of it for these past eight years. New startups and entrepreneurial activity have pretty much been stagnant, weighed down by heavy regulation, high taxes and an economy that’s just been stumbling along.
Economy Ends 2016 Strongly, Liberals Gaining On Conservatives
When the Commerce Department reported on December 22 that 3Q Gross Domestic Product increased at an annual rate of 3.5%, many of us in the forecasting business wondered if that figure might be too optimistic. We also wondered whether the economy could sustain a 3+% growth rate in the 4Q.
Most Americans Retire Too Early Despite Low Savings
We all know that there is a savings crisis in America. According to the National Institute on Retirement Security (NIRS), the median savings balance of near-retirement households is only around $12,000, while the median saving balance for all working-age households is only around $3,000.
Worker Productivity Growth Hits New Low - What Can Be Done?
President Obama is spending his last days in office trying to shore-up his “legacy.” He emphasizes that he inherited the worst economy since the Great Depression and most analysts would agree that is true for the most part.
Consumer Confidence Highest Since Before Great Recession
To coin an old phrase, the country has “gone ape” in the wake of Donald Trump’s surprise election as the 45th President of the United States. The stock markets have skyrocketed to new record highs day after day. Consumer confidence has soared to the highest level since 2008.
End Of TPP Brings New Opportunities For China & U.S.
President-elect Donald Trump promises that one of his very first actions when in office will be to withdraw the United States from the controversial Trans-Pacific Partnership (TPP), which was finalized earlier this year but must still be ratified by all of the participating nations.
Economy Is Weaker Than It Seems & Scary Facts On National Debt
Before I get into today’s topics, I think I speak for most Americans when I say that we are relieved that this election will finally be over late tonight or early tomorrow. This has been the ugliest and most embarrassing election in most of our lifetimes.
The Economy: Growth Has Been Weak But Long-Lasting
Forecasters who were predicting a surge in the economy in the second half of this year have revised those estimates much lower in recent weeks. It now looks like the economy may not achieve even 2% growth this year.