What’s Really Propelling the Stock Market Higher

Posted on March 15, 2013 by MN Gordon

Consumers are back at it…doing what they do best.  They’re buying stuff and they’re consuming it.  Moreover, they’re doing so at an accelerating rate.

The Commerce Department reported on Wednesday that retail sales increased 1.1 percent in February, the largest rise since September, and well above January’s 0.2 percent gain.  This is in spite of the 2 percent increase in payroll taxes and the tax increase on the rich.  Apparently, so far, smaller paychecks are not inhibiting people’s desires to spend money.

This increase in consumer spending should help the first quarter GDP number, since consumer spending makes up about 70 percent of the U.S. economy.  But is an increase in GDP, propelled by an increase in consumer spending, really a good thing?

If the increase in consumer spending is funded by savings and capital investment it is.  Unfortunately, this increase in consumer spending is supported by an increase in consumer debt.  This will have a lasting impact on future economic growth.

In short, people are borrowing today to pay for things they haven’t yet earned. Continue reading →

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Who’s Living Large in Retirement?

Posted on March 12, 2013 by MN Gordon

Who’s Living Large in Retirement?
By Dennis Miller, Editor, Money Forever

Who fares better in retirement, pensioners or folks who saved up their own respective nest eggs?  If you look at the numbers, you might be surprised to learn who’s really “living large” after retirement.

Regardless of how you made your money, what determines if you’re rich when you retire?  Frankly, it isn’t how much money you made, but how much you accumulated that counts.  So who are the real rich people?

Retirees generally fall into one of four groups: folks who retired from the private sector with a 401(k), IRA or a lump sum payout in lieu of a private pension; those with a government pension; self-employed folks who saved their own respective nest eggs; and finally, those scraping by on Social Security alone.

The U.S. Census Bureau reports that in 2010 the top 10 percent had a median net worth of $1,864,000.  If you’re worth that much or more, 95 percent of the population thinks you’re rich.  But are you? Continue reading →

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On the Good and Proper Way to Celebrate the New Bull Market

Posted on March 8, 2013 by MN Gordon

Something magical happened Tuesday.  The Dow Jones Industrial average closed at a new all-time high of 14,253…eclipsing its previous closing high of 14,164 set nearly five and a half years ago.  What a feat.

Wall Street cheered.  Jim Cramer pumped his fist.  Then, right when it seemed the day couldn’t possibly go any more favorably, Venezuelan President Hugo Chavez up and croaked.  We had to pinch ourselves twice to make sure this had all just really happened.

Unquestionably, these sorts of disjointed combinations salt and pepper the world in ways we never could’ve imagined.  Would it have been possible to plan a better day upon rising in the morning?  Perhaps, yes.  Though, it wouldn’t have been nearly as random or satisfying.

Of course, we don’t like to celebrate the dead.  That’s rather uncouth.  But we’re not perfect…we do slipup every now and then.  There was this time and that time, to be exact. Continue reading →

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Dead Wrong

Posted on March 5, 2013 by MN Gordon

New evidence was revealed last week further confirming that not only is President Obama a doomsayer…he’s a liar too.  The first of the President’s deceits was amusing hyperbole.  The second was pure humbug.  Still, they were nothing compared to some other remarks out of Washington…

For while the President was busy prophesizing the apocalypse and Bob Woodward was busy calling him a liar, down the way, over on Capitol Hill, Federal Reserve Chairman Ben Bernanke let out what must be the biggest whopper we’ve heard since the President uttered, “If you’ve got a business—you didn’t build that.”

While responding to questions from Senator Bob Corker, Bernanke said “my inflation record is the best of any Federal Reserve chairman in the postwar period.”  We’re not kidding.  He really said this…take a look yourself.

Bernanke must think we’re all fools.  How else can one explain such a remark?  He either doesn’t know what he’s talking about or he’s two-faced.  Quite frankly, we think it’s the later. Continue reading →

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