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The Best of What They Said and I Read week ending 4/9/2017

Short excerpts from articles I found interesting.

I may not agree with the author and the following material is not intended as investment advice.

Money Magazine – April 2017 A  Few More Words – Before I Go– by Diane Harris

  • “…At its core, this stuff isn’t that hard.  In fact, I can boil the keys to financial security down to just three steps…1.Have six months of living expenses stashed in safe, liquid account to help you through life’s inevitable bumps.  2. Automate your retirement savings, and boost your contributions by a percentage point every time you get a raise.  3. Spend mindfully, weighing each purchase against your goals.  And when you do part with cash, favor spending on experiences and people you love over stuff – science confirms the former makes you happier than the latter.”

Kiplinger’s Retirement Report – April, 2017

  • “Economy.  Inflation.  Expect overall inflation to rise to annual rate of 2.5% for 2017, up from 2.1 in 2016.  A rebound in energy prices will be the primary reason.  Core inflation, which excludes food and energy, will be 2.4% for the year – a bit higher than 2016’s 2.2%.  Services, including housing and medical care, will be the source of most of that rise.”

 U.S. Global Investors – Investor Alert – April 7, 2017 – by Frank Holmes

  • “It’s been an eventful week, to say the least. The U.S., for the first time, became directly involved militarily in Syria’s years-long civil war. Senate Republicans invoked the “nuclear option” to prevent a Democratic filibuster, allowing federal judge Neil Gorsuch to obtain Supreme Court confirmation. President Donald Trump met with Chinese leader Xi Jinping at Mar-a-Lago, the so-called “Winter White House,” to discuss trade and North Korea, among other issues.”
  • “It’s important that Trump put ample thought into improvements on international trade. I’m not convinced tariffs and border adjustment taxes (BATs) are the solution. Look at what happened in the 1930s with the Smoot-Hawley Tariff Act. In an effort to “protect American jobs,” the U.S. raised tariffs on more than 20,000 goods coming into the country, many of them as high as 59 percent. Once the act went into effect in June 1930, a trade war promptly ensued and global trade all but dried up. Today, historians almost unanimously agree that the policy, which President Franklin Roosevelt later overturned, only exacerbated the effects of the Great Depression.”
  • “The major market indices finished down this week.  The Dow Jones Industrial Average lost 0.03 percent. The S&P 500 Stock Index fell 0.30 percent, while the Nasdaq Composite fell 0.57 percent. The Russell 2000 small capitalization index lost 1.54 percent this week”.
  • “The unemployment rate dipped 0.2 percent to 4.5 percent, the lowest level since May 2007, while average hourly earnings rose 2.7 percent versus a year ago…Europe's economy had its best quarter in six years. The latest PMI surveys from IHS Markit showed March's composite reading of 56.4 was the best pace of expansion since the first quarter of 2011…Euro area unemployment hit an eight-year low. The region's unemployment rate fell to 9.5 percent in February, its lowest reading since May 2009, according to Eurostat data released Monday.”
  • “According to New York Fed President William Dudley, the rising burden of student debt is weighing on interest rates in the U.S. Dudley and many of his colleagues have argued that the economy doesn’t have the potential to grow as fast as it did before the 2007-2008 financial crisis due to factors such as an aging population, low productivity growth and a reduced willingness by households to spend. Dudley and his staff presented data showing significant disparities in home-ownership between those who graduated from college with debt and those who graduated without it. “


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