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Weekly Roundup #4 – Janet L. Yellen Confirmed as First Chairwoman

Financial Market Updates Source: mlive.com Although nobody was surprised by the news, Janet L. Yellen was confirmed as the first Fed chairwoman. She will be taking office on Feb. 1st, three days after the FOMC meeting ends. Guess we're stuck with Bernanke for one more session. Despite all of the recent talk about more Fed tapering (ever since the Fed started tapering in December), the unemployment report on Friday probably put a stop to further cuts in the near-term. Although the unemployment rate went down to 6.7%, the economy only added 74,000 jobs. This will certainly give Bernanke [...]

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Average Student Debt: How to Reduce It

Source: Huffington Post What is the average student debt? The average student debt is $35,200 for the class of 2013 according to a Fidelity survey. Most student debt comes from private and state loans, while about 30% comes from credit card and personal loans. What debt to pay first Beyond required monthly payments, paying down debt should be a priority. To make sure debt is being paid down in the most cost effective way, pay down the debt with the highest interest rate first. This will likely mean paying down credit card debt first, then private loans, and [...]

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Funding Strategies for Retirement

While it may seem inconsequential, the order in which you fund your investment accounts does indeed matter! Generally, accounts should be funded in the following order: 401(k) or Qualified Employer Sponsored Retirement Plan Traditional IRA and/or Roth IRA 529 Plan (if applicable) Individual/Joint Accounts When saving for retirement tax advantaged accounts should always be funded first, as your money is able to grow tax deferred until withdrawal. If your employer will match a percentage of contributions to your 401(k), invest at least the minimum amount to receive the full contribution. This is FREE MONEY people! Once you have qualified for the full match, you can decide [...]

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Is the unemployment rate still a reputable indicator for the health of the labor market?

The US employment situation was surprisingly weak. Nonfarm payrolls rose only 74,000 in December while economists were expecting 200,000. But, the unemployment rate fell from 7.0% to 6.7%. So, what's going on? Source: Jimaging The Unemployment Rate Is Not A Good Indicator Anymore The problem with taking the unemployment rate at face value is that it doesn't take into account those who have stopped looking for work or left the labor force. In fact, in December, nearly 350,000 people walked away from the labor force. Another problem with the unemployment rate is that it does not discriminate by [...]

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Fast Cash Fridays: Churning Credit Card Bonuses

Fast Cash Fridays is a weekly series aimed at providing you tips on how to make money fast (not necessarily easily). Please tune in every Friday for your newest making money fast tip. How to Make Money Fast by Signing Up for Credit Cards In an attempt to lure you into their snares, many credit card companies offer a sign-up bonus for getting a new rewards credit card. Depending on the type of card you sign up for the bonus may be in miles, cash back, points,  or some other form of compensation. Often these rewards can be cash equivalents of [...]

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Markets Flat Ahead of Employment Situation

The market remained flat despite strong US job numbers released this morning - jobless claims fell 15,000 to 330,000. Still, the big test of the week will be tomorrow's Employment Situation. It is widely expected unemployment will stay at 7.0%. It is unclear how the market will react to the unemployment number. As unemployment falls, the greater likelihood of faster tapering of asset purchases by the Federal Reserve. This means interest rates will be more likely to rise, potentially slowing consumer demand and capital investment. This is why the market is skeptical of positive economic indicators. Rising Interest Rates Slow [...]

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Forecast for USD in 2014

As you consider your finances for 2014, you are probably concentrating on the market in your local area. However, we are living in the day of a global economy. If you live in the United States, you might not ever travel to Asia in your lifetime. However, the economic conditions in Asia undoubtedly have an affect on the US economy. As each year closes, financial analysts attempt to make predictions about what will happen in the upcoming year. If you perform an online search, you can quickly find a wide variety of financial predictions. However, it is important to remember [...]

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Fear of Fed Tapering Keeps Markets At Bay

Positive economic indicators are keeping the market at bay as investors weigh the potential for additional Fed tapering in coming months. Economic Indicators ADP employment came in much higher than consensus at 238K. ADP employment acts as an indicator for the Employment Situation report which comes out this Friday. Unemployment is expected to stay at 7.0% in that report. Overall, the ADP report is a positive indicator that points to an improving US labor market and a positive Employment Situation report on Friday. The FOMC minutes were also released today and show there was debate during the Dec. 17-18 meeting [...]

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Janet Yellen Confirmed, First Fed Chairwoman

Janet Yellen will be the first woman to lead the Federal Reserve starting February 1st. She will be inheriting a massive $4 trillion balance sheet and will be in charge of winding down the largest asset purchase experiment in the history central banking. Yellen's Stance Yellen has been supportive of quantitative easing efforts. In fact, markets celebrated when Yellen was nominated over Larry Summers for the Fed chair position. This is because Yellen is more likely to continue easing for a longer period of time than Summers. Wall Street dubs Yellen a "dove" - she is more concerned with unemployment [...]

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The Quantitative Easing Behavioral Life Cycle

The Quantitative Easing Behavioral Life Cycle I found this chart on Pragmatic Capitalism and think it is very amusing. The ideas and theories surrounding quantitative easing  have evolved almost constantly over the past few years. The chart does great in summarizing these ideas and theories. If you want to know more about quantitative easing, click here.

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“Price is what you pay. Value is what you get.”

Warren Buffet