Master Financial Education

Financial and Economic Daily Commentary 2018
The  most intensive and extensive on the Web

E. F. Moody Jr.

click above for bio


USA Today- "This is a high-powered personal bookmark list that spans the spectrum of the truly useful."

FORBES- "You'll find some great information."

BUSINESS WEEK: "For an Expert, Click here"  

World Statistical data
Market Quotes by TradingView


From an adviser: It is a daily read for me. Clearly biased towards the client. Great perspectives and links to thought provoking material. Greatly appreciated.

Investor/Investing Risk of Loss: Identify, Manage and Limit Investment
Risk of Loss on Mutual Funds and ETFs

Four Phase Process that will change the investment dichotomy for 75% of Middle and Lower Income investors overall and up to 90% for 401k Investors 

Losses limited to about 12% for recessions

Patent Pending

Morality, Sexism, Ethics, Corrupt Equilibrium

Critical reference to the limited fiduciary capabilities in the planning industry (and more) and why they may/will remain as such given sophomoric DOL rules and flaccid organizational enforcement. Specific commentary to sexism and ethical and moral lapses of society impacting women. Not the standard drivel

 Target Date and Bond Funds

 Retirement Fiduciary Breach

Analysis for investors and advisers. The economic changes from the Great Recession caused major adjustments in investing. One of the major issues is the flip flop of the correlations in bond funds versus equities  coupled with a truly lower return and an increased overall risk. It will take a lot more effort to provide adequate return for those in need and the discussion will address pros and cons particularly for retirement purpose Emphasis on risk, Click for full article.

“It’s not the Fed’s job to stop people from losing money.”

Jay Powell- head of the Federal Reserve

3/21: Financial Report of the United States Government

Guide to Understanding the Annual Financial Report of the United States Government

3/21: Caregiver Manifesto

  1. I will fearlessly assess my personal strengths and weaknesses, work diligently to bolster my weaknesses and to graciously recognize my strengths.
  2. I will fearlessly make my voice be heard with regard to my loved ones care and be a strong ally to those professional caregivers committed to caring for my loved one and a fearless shield against those not committed to caring for my loved one.
  3. I will fearlessly not sign or approve anything I do not understand, and will steadfastedly request the information I need until I am satisfied with the explanations.
  4. I will fearlessly ensure that all of the necessary documents are in place in order for my wishes and my loved ones wishes to be met in case of a medical emergency. These will include Durable Medical Powers of Attorney, Wills, Trusts and Living Wills.
  5. I will fearlessly learn all I can about my loved one’s healthcare needs and become an integral member of his or her medical care team.
  6. I will fearlessly seek out other caregivers or care organizations and join an appropriate support group; I realize that there is strength in numbers and will not isolate myself from those who are also caring for their loved ones.
  7. I will fearlessly care for my physical and emotional health as well as I care for my loved one’s, I will recognize the signs of my own exhaustion and depression, and I will allow myself to take respite breaks and to care for myself on a regular basis.
  8. I will fearlessly develop a personal support system of friends and family and remember that others also love my loved one and are willing to help if I let them know what they can do to support my caregiving.
  9. I will fearlessly honor my loved one’s wishes, as I know them to be, unless these wishes endanger their health or mine.
  10. I will fearlessly acknowledge when providing appropriate care for my loved one becomes impossible either because of his or her condition or my own and seek other solutions for my loved one’s caregiving needs.


“Do People with Dementia Get Help Managing Their Money?”

By Anek Belbase, Geoffrey T. Sanzenbacher, and Abigail Walters

The brief’s key findings are:

  • Dementia severely erodes people’s capacity to manage their finances.
  • But this analysis finds that most with dementia get help – typically from spouses and children – with everyday activities such as writing checks and making deposits.
  • Those who receive help are much less likely to experience severe financial hardship, such as a lack of funds for food or rent.
  • While encouraging, more than 10 percent of those with dementia lack help, and this share could grow because aging boomers have fewer children.

This brief is available here.

3/21:EXCLUSIVE: Notes, emails reveal Trump appointees' war to end federal teen pregnancy program

The sudden cancellation of a program designed to prevent teen pregnancies was directed by political appointees with strict pro-abstinence beliefs, over the objections of experts at the Department of Health and Human Services, internal notes and emails obtained by NBC News show.

Career staffers were told to "get in line" after objecting to the move. The story behind the program's demise is part of a broader narrative about programs benefiting women and children becoming political targets in the Trump administration.

EFM- I cannot believe anyone would want that program to end. Pure abstinence may be fine in theory but theory and hormones seem to be at oddds with teenagers (and many others actually)

Will this Never End???


College Advice for Deaf and Hard of Hearing Students -

Scholarships and Resources for Deaf and Hard of Hearing Students - 

Disability Resources For College Students -

3/21: India’s anti-corruption battle will take decades to win

The point here is not so much about India but a combination of countries with all sorts of corruption, violence, drugs, disease and on and on. South America is a big cesspool that will never get cleaned up. Asian.countries have their graft- but one that tends to leap out is the Philippines. . Duterte has 'allowed' killing of drug kingpins all the way down to the local hustlers. Think that will get straightened out in a decade? Two? Iran, Afghanistan    and the associated have internal problems of tribal issues that have gone on for generations. So has Africa. Will these  problems become better with time? No. We are going to ad another 1/5 billion people by 2050. Water shortage, lack of food, pestilence, pandemics, regular war and racial unrest, and more will hit all nations.  Lots of external AND internal violence will quickly roil society. One item could change all that. Runaway Artificial Intelligence. Our civilization will be declining toward 2050 and the resulting carnage worldwide  should make our civilization just end up like some of our movies. I do not believe we can stop AI.

3/21: More debt coming up

Economists and analysts warn that, as the economy has improved — unemployment is low, wages are rising — the government’s need for more money is likely to push interest rates higher. That will make it more expensive for companies and consumers to get loans and potentially will hurt the economy.

3/21 P&C implications from Moody's climate change report

Costs for future natural disasters are only likely to rise, which means a higher number of claims and losses for the property & casualty insurance and reinsurance sectors. Risks arise primarily from weather-related catastrophe, potential claims on liability policies and investments. To a lesser degree, climate change also presents opportunities for firms to introduce new products and expand existing products.



"Financial Contagion: A New Perspective (and a New Test)" Free Download
European Stability Mechanism Working Paper No. 12; ISBN 978-92-95085-19-0

MATTEO COMINETTA, European Stability Mechanism

Contagion has mostly been interpreted and tested as a break from a stable linear correlation of financial markets caused by an extraordinary shock. This paper argues that quantile regression can provide a tool to investigate alterations in other features of financial returns’ distribution caused by extraordinary shocks, thus providing additional understanding of the mechanism of financial shock propagation and its instability. Applying the technique to stock market returns, we find evidence that jumps in uncertainty have powerful contagious effects of a form different from an increase in markets’ correlation. These effects would not be detectable in standard contagion tests that search for increases in market correlation.

3/20: United We Learn has been promoting several helpful guides supporting deaf and hard-of-hearing students in school, including in college

3/20. TRUMP ‘DOESN’T NEED’ THE ADULTS IN THE ROOM: The Times reports that Trump now believes he doesn’t need to rely on people such as chief of staff John F. Kelly, economic adviser Gary Cohn or former Secretary of State Rex Tillerson any longer:

His closest aides … say Mr. Trump now feels he doesn’t need the expertise of Mr. Kelly, Mr. Cohn or … Tillerson … If he once suspected they were smarter or better equipped to lead the country and protect his presidency, he doesn’t believe that now.

EFM- I feel so much better now.

This Northern Light is called STEVE (really)

3/20: IUL abuses- Roccy DeFrancesco

Comparing New IUL Products Post AG49 - What Changed?


                Let me remind you what AG-49 is and why it was passed. AG-49 are illustration regulations put in place to curb the abuses that were occurring with IULs (indexed universal life). There were agents giving out IUL illustrations showing an average rate of return in excess of 8%with lending rates as low as 5% for policy loans. These types of illustrations were from a fantasy world. Agents shouldn't have been using them.

                                 AG-49 changed the illustration guidelines so that most companies couldn't illustrate more than a 7% rate of return and limited the borrowing rate to no more than a 1% positive loan arbitrage.


                Non-Guaranteed Bonuses-most companies have added bonuses in their IULs. Doing so increases the illustrated rate above what AG-49 allows. So, if AG-49 allows a company to illustrate at a maximum rate of 7%, if the company throws in a 1% annual bonus on the cash inside the policy, you are effectively illustrating an 8% rate.

                                 The problem is that most of the companies are NOT guaranteeing the bonus. Most agents don't understand this and they are NOT communicating this to clients. One new IUL that recently hit the market DOES guarantees the bonus from day one. My position is that such a policy MUST be discussed with clients when also presenting a policy that has a non-guaranteed bonus.

Yes, IUL are that hard to understand. Harder to compare

3/19: More women get degrees

"Early Gender Gaps Among University Graduates" Fee Download
CEPR Discussion Paper No. DP12754

MARCO FRANCESCONI, University of Essex, Centre for Economic Policy Research (CEPR), Institute for the Study of Labor (IZA)
University of Essex - Department of Economics

We use data from six cohorts of university graduates in Germany to assess the extent of gender gaps in college and labor market performance twelve to eighteen months after graduation. Men and women enter college in roughly equal numbers, but more women than men complete their degrees. Women enter college with slightly better high school grades, but women leave university with slightly lower marks. Immediately following university completion, male and female full-timers work very similar number of hours per week, but men earn more than women across the pay distribution, with an unadjusted gender gap in full-time monthly earnings of about 20 log points on average. Including a large set of controls reduces the gap to 5-10 log points. The single most important proximate factor that explains the gap is field of study at university.

3/19: 401k Fiduciaries: Is It Time to Hone Your Processes?

Abstract: Three key areas of vulnerability arise from last year's ERISA litigation. This article discusses these vulnerabilities in detail and suggest ways plan fiduciaries can defend against them and reduce their exposure to liability.

3/19: European Equity funds 

Over the one-year period ending December 2017, 74% of euro-denominated European equity funds underperformed the broader S&P Eurozone BMI, while 47% lagged the S&P Europe 350®. The number of active managers who underperformed grew to 88% and 85%, respectively, over the 10-year investment horizon.

SPIVA® Europe Scorecard S&P Dow Jones Indices has been the de facto scorekeeper of the ongoing active versus passive debate since the first publication of the S&P Indices Versus Active Funds (SPIVA) U.S. Scorecard in 2002. The SPIVA Europe Scorecard measures the performance of actively managed European equity funds denominated in euro (EUR), British pound sterling (GBP), and other European local currencies against the performance of their respective S&P DJI benchmark indices over 1-, 3-, 5-, and 10-year investment horizons.

-END 2017 HIGHLIGHTS  European equity markets achieved strong, above-average gains in 2017. The S&P Europe 350 ended the year 10.75% higher, as historically low levels of volatility in the markets indicated investors’ confidence in the strength of the continent’s economy and stability of its pro-EU leadership. 

Continued global expansion throughout the year supported strong bull rallies across international markets. Despite robust global growth, the weakening of the U.S. dollar throughout the year reduced returns for European investors holding global and U.S. equities. The S&P Global 1200 and the S&P 500® finished the year up 8.57% and 7.01%, respectively, in euro terms. Meanwhile, the broad emerging equity benchmark recorded an impressive one-year return of 21.12% in euro terms, as measured by the S&P/IFCI. 

The majority of active fund categories in Europe underperformed over the past 10 years. Nine out of 23 active fund categories across the European-domiciled equity funds analyzed were able to provide average asset-weighted returns above their corresponding benchmarks over a 10-year period. Furthermore, in those nine outperforming categories, less than one-third of the funds beat the benchmark. This indicates that a minority of funds were responsible for each group’s success. 

U.S. and Emerging Market Equity funds domiciled in Europe remained among the region’s worst-performing active fund categories. Euro- and pound sterling-denominated funds investing solely in U.S. equities provided average returns that were below their local currency S&P 500 benchmark for all periods analyzed. Less than one-third of these funds outperformed in 2017 and less than one-tenth outperformed since 2008. Experience the Active vs. Passive Debate on a Global Scale on INDEXOLOGY®. SPIVA Europe Scorecard Year-End 2017 RESEARCH | SPIVA 2 

Likewise, European funds managing global emerging equities failed to deliver average returns above the benchmark over any period analyzed. Interestingly, this finding is in stark contrast to the widely held belief that inefficient markets provide the best opportunities for stock pickers to outperform. 

One-year performance of active pan-European equity funds (euro-denominated) relative to the S&P Europe 350 was fairly evenly split. In 2017, 53% of funds in the category outperformed the benchmark. Over the 10-year period, 15% of funds in the same category beat the S&P Europe 350. Of the funds that were in existence in the category at the start of 2008, 45% survived to the end of 2017. The average asset-weighted performance for the fund category was 11.97% for the year, compared with a return of 10.75% for the benchmark. Over the 10–year period, the equivalent average return figure was lower than that of the benchmark, at 3.37% and 4.08%, respectively. 

In contrast to pan-European equities, only 26% of actively managed funds investing solely in Eurozone equities beat the S&P Eurozone BMI in 2017, dropping to 12% over the 10–year period. The average asset-weighted performance for the group was consistently lower than the S&P Eurozone BMI by one percentage point on an annualized basis over all periods analyzed. 

Single-country fund categories across Europe had mixed results in 2017. A majority of funds in Italy, Swtizerland, Germany, the UK, and Sweden outperformed over the one-year period. The same categories also provided average asset-weighted returns above their corresponding benchmarks. However, the majority of funds investing in equities in Denmark, Poland, The Netherlands, Spain, or France were beaten by their corresponding benchmarks in 2017. Only Italy maintained a majority of active funds outperforming over the one-, three-, and five- year periods. In no fund category did a majority of funds outperform over the 10-year period. 

asUK Small-Cap Equity funds performed markedly better than their UK Large-/Mid-Cap counterparts in 2017. Of actively managed UK Small-Cap Equity funds, 80% outperformed their benchmark for the year, compared with 46% for the UK Large-/Mid-Cap Equity fund category. Average asset-weighted returns for these UK small-cap funds exceeded the S&P United Kingdom Small-Cap by nine percentage points for the year. The recent success of these small-cap funds over large-cap funds in the UK was in contrast to the long-term picture; the reverse was true over the 10-year period. In both categories, however, 10- year outperformance was achieved by less than one-quarter of the funds.


PSCA Study Finds Roth Usage Doubled in Past Decade

Abstract: Roth availability doubled in the last decade according to the Plan Sponsor Council of America's 60th Annual Survey of Profit Sharing and 401k Plans. PSCA, part of the American Retirement Association, found Roth was offered in 63.1 percent of plans in 2016 compared to 30.3 percent in 2007.


  1. Be close to me and I will be honest: How social distance influences honesty




Hermann, Daniel ; Ostermaier, Andreas

We conducted a laboratory experiment to examine how honesty depends on social distance. Participants cast dice and reported the outcomes to allocate money between themselves and fellow students or the socially distant experimenter. They could lie about outcomes to earn more money. We found that dishonesty increases with social distance. However, responsiveness to social distance depends on personal preferences about inequity and honesty as a moral value. We observed selfish "black lies" but not altruistic "white lies" (outcomes were not understated to reduce inequality). Our results suggest that the reduction of social distance can promote honesty in social interactions.

Sure seems fair to the elderly, doesn't it??


  1. The effects of physical activity on social interactions: The case of trust and trustworthiness




Di Bartolomeo Giovanni ; Stefano Papa

There is no doubt that physical activity improves health conditions; however, does it also affect the way people interact? Beyond the obvious effects related to team games or sharing common activities such as attending a gym, we wonder whether physical activity has in itself some effect on social behavior. Our research focuses on the potential effects of physical activity on trust and trustworthiness. Specifically, we compare the choices of subjects playing an investment game who were previously exposed to short-time physical activity to others who are not exposed to it, but involved in different simple tasks. On average, we find that subjects exposed to physical activity exhibit more trust and pro-social behaviors than those who are not exposed. These effects are not temporary.


  1. Are equity market anomalies disappearing? Evidence from the U.K.




John Cotter (University College Dublin) ; Niall McGeever (University College Dublin)

We study the persistence over time of nine well-known equity market anomalies in the cross-section of U.K. stocks. We find strong evidence of diminished statistical significance for most of these anomalies including the return reversal and momentum effects. Two anomalies – firm profitability and stock turnover – remain quite robust throughout our sample period. These results hold for both portfolio sorts and Fama-MacBeth regression analyses and are robust to the use of alternative methods of risk adjustment. Our findings are consistent with improvements in market efficiency overtime with respect to well-known anomaly variables.


Anomalies, Asset Pricing, Market Efficiency


G10 G12


3/18:Report: People with fewest assets wish they were saving more

A Hearts & Wallets report found that the number of households with less than $50,000 in investable assets dropped 2.1 million over the past four years to 49.4 million. Of those households, 33 million say they wish they were saving more money, according to the report.

3/18: Bad management is the main reason people leave their jobs, 50% of U.S adults have left a job “to get away from their manager”

3/18: Far too high

3/18: The four best S&P 500 funds

Vanguard, Fidelity, Schwab, TRowe Price.

EFM- Something is wrong though. The volatility of Vanguard and Schwab is 10.07%, yet the 15 year volatility of TRowe Price is 13.56%. Same inconsistency with Sharpe ratio. I am not going to .research this but it speaks volumes about statistics.

3/18: OIL

Oil prices jumped on Friday despite an increase in the rig count, rising U.S. production and a subdued decline in oil inventories.


3/18: Opiods

Recent data from the Centers for Disease Control and Prevention (CDC) tells us that the number of overdoses is increasing. Law enforcement agencies across the country have reported that fentanyl and carfentanil (which can be 100 to 10,000 times more potent than morphine) are much more prevalent.

3/18 Cold war

With North Korea and Russia, the trade war, assassins in Britain, the world has now entered in another long period of instability. We even lied to Canada

3/18: Hey, you wanted kids..................

Report estimates future cost of sending children to college

A report from calculates that the total cost of sending someone to a four-year college 18 years from now will be about $355,000 for a private school and about $157,000 for a public college. The report suggests it may be more realistic for families to plan on saving enough to pay between 25% and 33% of the cost, rather than the full amount.

3/18:Commentary: Flattening US yield curve causes concern

Disappointing economic data have caused the US yield curve to flatten, ending brief hope of a bond-market rally and causing consternation among market watchers, writes Ben Eisen. He quotes a research note by the Federal Reserve Bank of San Francisco: "Periods with an inverted yield curve are reliably followed by economic slowdowns and almost always by a recession."

The Wall Street Journal (tiered subscription model) (3/15) 


3/18: A quiz

3/18: A fiduciary duty??

An Institute survey released on March 8 revealed that just 15% of CFPs are fee-only. A full 85% reported full or partial commissions or no methods. This is fairly consistent in different parts of the country.

evidence argues that brokers already believe they are fiduciaries. A survey cited by the CFP Board showed that, among investment professionals, just 16% would “expect their advice might be different” under a fiduciary standard. This speaks volumes.

the question is whether there’s a reasonable basis to believe the proposed standards will result in fiduciary advice. How can that be when there is no rebuttable presumption that the CFP mark means fiduciary conduct, no urging CFPs to avoid conflicts over disclosing them, no guidance on avoiding or mitigating conflicts, no required written disclosures, client consents, and no clues on enforcement?

EFM- As many long time readers are aware, I have a serious disagreement with the legality and ethics of the CFP Board overall going back 25 years ago. Mostly it is the 'allowed' failure of CFPs to be legal nor ethical. The Borrd stated that it would not enforce an ethical violation unless preceded by a legal one. lI have reams of documentation on the aforementioned  and maintain the position that a CFP designation might be a good start to become a planner, it is a long way from the necessary competence.  As to an example, what has been a 100% indicator of a recession?? If that is not taught- and it isn't- then the level of knowledge is way too low.

3/18: Women Who Are in Shape Are 90% Less Likely to Develop Dementia

In the study, which involved nearly 1,500 women in Sweden who provided information on their physical activity levels and took cognitive tests for up to 44 years, scientists found that women with higher fitness levels were 88% less likely to develop dementia compared to women with average fitness. Women with lower fitness had a 41% higher risk of developing dementia than women with average fitness.

While the study focused on cardiovascular fitness, Horder says that as people get older, strength training and building muscle are also important. More research is needed to pinpoint when during midlife the fitness benefits start accruing to reduce dementia risk — in the current study, the women ranged in age from 38 to 60 when they began the trial — and also whether improving fitness can actually slow or prevent dementia.

3/18: The greed-fear cycle is alive and kicking
Markets are back in fairyland again. For many investors, the regret of missing out on what may well be a once-in-a-generation bull market overshadows any anxiety about the next crash. Animal spirits are all too evident. Nothing seems to deter investors: the Brexit vote, fears of trade wars after the latest wave of tariffs on steel and aluminium by President Donald Trump, two North Korean missiles flying over the Japanese land mass, the debt python constricting the global economy, the rollercoaster ride of the cryptocurrencies, covenant-lite loans, IPOs with no voting rights — the list goes on. For all we know, risk is being stacked up like a wedding cake.

EFM- when this next recession hits, it could be as bad as 2008.

3/18: The Choking Game

Erik Robinson was 12 years old in April 2010 when he accidentally strangled himself. He had just returned home from a Boy Scouts weekend retreat, where he earned an award for leadership, when he wrapped a rope around his neck and hung it from the pull-up bar in the kitchen of his family’s two-bedroom apartment in Santa Monica, Calif. He was seeking the moment of lightheadedness and euphoria that comes from breathing again after temporarily cutting off the flow of blood and oxygen to the brain. Instead, he died. The cause listed by police: the “Choking Game.”

3/18: JPMorgan has calculated the likelihood of recession. The firm's model found an 18% chance of a recession over the next year, with chances increasing to 52% over two years and to 72% over three,

The percentages may be OK save for a Trade war and a bad meeting with North Korea. You could also add in another cold war with Russia. And certainly a cold reception with anything with Canada. And quite frankly is the new budget which will cause untold misery as time goes on. Huge deficit forthcoming

Real photo of crocodile eating a shark it had just caught

3/18: Millennials Foresee No Such Thing as a Comfortable Retirement

Millennials don’t share the confidence of Baby Boomers and Gen Xers that they will be financially better off than their parents, Prudential Financial learned in a survey. Eighty-eight percent of Millennials say that people in their 20s and 30s will need to work much longer than previous generations to retire with the same level of financial security. Even if they do work longer, 79% believe that by the age of 80, a comfortable retirement will be a thing of the past. Seventy percent say that is because they are unable to save as much as retirement planning tools recommend. Read more >

EFM- sounds about right

3/16: Trump lying to Trudeau??

It's one thing to lie. It's another thing to boast and broadcast about it. When Trump fired Comey it left a lot of people guessing what was the reason. But to boast about it to the Russians in the Oval Office  was just plain stupid. You do  not need management courses for that. Worse yet was the lies to Trudeau and then BROADCASTING as brilliant is extraordinarily stupid. How many heads of counties are going to feel comfortable in exchanging contracts et al with no idea if Trump might not turn around and say, :just kidding" ?

3/16: Commentary on IUL products

It wasn’t long ago that an advisor could look at two illustrations and decide which product would be better for the client. Unfortunately, those days are behind us now thanks to AG49. (AG 49 was developed by National Association of Insurance Commissioners (NAIC) to help standardize illustrations, provide insurance carriers a more uniform method for calculating maximum illustrated rates on IUL products and to help consumers better understand index life insurance product illustrations.) There are so many variables when it comes to evaluating IUL that it has now become almost impossible to do without a complete understanding of the actuary’s goal when creating the product. Now more than ever carriers are tweaking their policies behind the scenes and making it more difficult for us to know what’s going on under the hood. As a producer, you can no longer compare products apples to apples.


Pre AG-49, it seems liked we were all on the same page, We all knew the illustrations were guaranteed to be one thing, WRONG! Now that illustrated rates have been standardized based on the S&P index, we see advisors falling back into the trap of selling based purely on an illustration. Unfortunately, with AG 49, now all the magic is happening behind closed doors. We frequently see the best-looking illustrations being fueled by some of these phantom, unexplainable bonuses that arose out of AG49. Now more than ever as an agent you need to make sure you are working with an IMO/marketer that understands the interworking’s and hidden mechanisms of these products. Too many clients are buying policies that look great on paper, but are being fueled by non-guaranteed, impossible to understand bonuses. It is imperative you understand where the policy performance is coming from in the policies you sell. If you don’t understand it, your current IMO isn’t doing their job and your client most certainly doesn’t understand it. The crediting rate used to drive most of the policy performance. At least that was out in the open for everyone to see. Long gone are the days of simply running each company at a set rate and then comparing the numbers, and if that’s all your current IMO is doing for you, it’s time to find a new one.


The other huge area of change, that we can all agree needed to was the 1% max loan arbitrage. Gone are the days of showing illustration at 7.25% with a 4.25% loan rate and 15% cash flow….. That was absolutely criminal! Unfortunately, a lot of these types of illustrations were going out and agents were selling pie in the sky to consumers

So where are we now? AG49 brought up 4 major issues that needed to be addressed:



*Max loan arbitrage

*Guaranteed bonus

*Max illustrated rate


It is important to now explore these four points and how they affect how you and your IMO now design policy’s. We will delve further into each of these issues to make sure you have a better understanding of how they will further shape the way you continue to do business in an ever-evolving marketplace.


The most important questions you as a financial professional need to ask yourself is are you working with an IMO that understands what these changes mean and how to design cases that fit your client’s retirement and financial goals? If there is any question in your mind, then you need to join this webinar…

EFM- these are tricky and everchanging. I do not deal with them. But the issue is do I understand them and can they work in the real world. So I will attend............  

3/16: Caregiving- Handling Guilt

There are many stresses and strains in the relationship between adult children and their aging parents, but one of the greatest of these stresses is the daily responsibility of caregiving. Providing hands-on care, food, shelter, clothing, transportation and companionship, as well as serving as financial manager and counsel has become commonplace for many adult children.

Most also have a number of other responsibilities as well: to their spouses or significant other and to their own children, to their place of employment, to their social or church affiliated groups and to their friends. Individuals in this situation are seen as the “juggler,” trying to give equal time and consideration to all who want their time and attention, with little time and consideration left for their own health and welfare. As you can guess, this is not possible to do on a sustained basis before something starts to erode. In most cases, this “something” is the caregiver’s patience and own ability to cope with daily life.

Is it any wonder that people in this “Sandwich Generation” cry out “What’s left for me?” and “How can I satisfy everybody?” The answer is - YOU CAN’T! Superman and Superwoman only live in the comics!

There are many feelings and emotions that stem from this constant stress and strain of serving as the main caregiver. These include: frustration, anger, resentment, inadequacy and guilt. Why are adult children full of these feelings, particularly guilt? They often ask the following questions:

  • What else can I do to keep Mom or Dad comfortable?
  • Am I doing the right thing - have I explored all the options available?
  • They took care of me, why can’t I take care of them now when they need me the most?
  • Am I weak/incompetent/selfish?
  • If I don’t devote all my time and energy to Mom or Dad, will I be a bad “child”?

Adult children who feel guilt manifest this feeling by being complaining, offensive or accusatory, overprotective and either visit too often, or not often enough. They often also feel that unless they can return total care to their aging parent, they are not doing enough. This is especially true if there is only one adult child who has the full burden placed on them, or the one of the “bunch,” most often a daughter or the child who lives the closest geographically to the parent, who assumes the burden of care.

What can you do, then, to relieve the guilt that arises when you have all this demand on your time? When you realize that things are reaching a breaking point, arrange for a family meeting, which includes your aging parents, any siblings, your spouse or significant other and your children. You may want a professional involved to facilitate. Letting everyone know your feelings and that you are not able to juggle all the responsibilities anymore may help others to begin to share the load. It is important here to recognize that there are many instances where the main caregiver refuses to acknowledge that they can’t handle the load— they are too caught up in the daily grind that they don’t recognize the warning signals (extreme fatigue, lack of rest, irritability, frustration over lack of time, among others). A professional, outside perspective in this case would be beneficial to objectively point out the potential dangers of trying to do everything for everyone without a break.

Another tip is to negotiate from the start just exactly what the roles will be in terms of providing care for an older relative. Ask for and involve outside agency help in order to get occasional respite. If your parent is resistant in accepting outside help, demanding that you do the job, be FIRM in expressing that you have to look out for your own needs. If you don’t, you will eventually wear yourself down to the point where you are no longer effective as the main caregiver. You should not feel guilt in insisting that you take time out for yourself. Remember to follow through on your plan for getting respite relief—you deserve it! Also remember that the help you receive is competent and is able to handle emergency situations if they arise.

With older people living longer, many adult children are faced with the prospect of being a caregiver for a significant number of years. It is important for adult children to recognize that, in many cases, they will never satisfy or completely fulfill their obligations to their parents, no matter how hard they try. Many try to seek parental approval by giving up all their other needs and responsibilities to care for that parent before that parent dies.

For many, there are unresolved issues between the two generations that adult children feel can be cured by becoming the main caregiver, to make up for the past. These unresolved issues will, eventually, get in the way of the adequate provision of care on a long-term basis. Recognize that fact, with the help of a professional or through a support group, and come to terms with this issue with your parent.

Letting others provide care for an older relative without feeling guilty can be a starting point in the new relationship between the two of you and can be the saving grace in keeping your own life in balance.

3/16: The closed world of policy and research: Roula Khalaf says there is a feminist drive among think tanks, which are discovering the value of including women. The project-based business model of such institutions is still a challenge, however, meaning they lack resources to prioritise issues that can be important to woman.  

The rise of index funds is a boon for CEOs looking for support for rational longer-term plans. Passive fund managers are not competing to outperform an index on short-term timescales. As a consequence, the corporate governance teams at companies such as BlackRock, Vanguard and State Street are able to consider longer-term positive implications of your proposed strategy. Don’t neglect these people when you visit the offices of these investment behemoths; the active managers may be more vocal but the corporate governance teams — speaking for many multiples of votes relative to the active managers — have much more power to support your plans. The activist hedge funds learnt this a long time ago; they habitually solicit support from the big passive managers as a precursor to launching their initiatives and bids.

Quintin Price

3/16: Russia:“The trouble is that Russia probably doesn’t much worry about diplomatic expulsions, and British sanctions would add little to the broad range of Western sanctions already in place over the annexation of Crimea,” a New York Times editorial noted this week. “Yet if Russia’s message is that no 'traitor' is safe anywhere, it should be in the interest of every nation to send an indelible message to Mr. Putin that he cannot deploy his weapons of war anywhere he wants.”

EFM- so far, Putin is the winner in all this mess. And that includes Syria

3/16: Pelvic Floor Muscles

Some conditions may feel too embarrassing to discuss with your doctor. Weak pelvic floor muscles can cause such conditions.

You may have trouble with bladder or bowel control. Urine can leak out when you cough, sneeze, laugh, or exert yourself in any way. You might need to urinate often or urgently.

Weak muscles can also affect the vagina and uterus. You may feel discomfort inside your vagina. Telling your doctor about these conditions can help you get the right treatment.

Your bladder, bowel, vagina, and uterus are held in place by a hammock of muscles called the pelvic floor. Weak muscles can’t hold up these organs. That can cause your bladder to leak and other embarrassing conditions called pelvic floor disorders.

Pelvic floor disorders affect women of all ages. Experts estimate that 1 of every 3 women in the United States has a pelvic floor condition. But because so many women don’t tell their doctor, they’re probably much more common.

Many factors—including family history, pregnancy, menopause, weight, and smoking history—can affect your risk for developing a pelvic floor disorder. Dr. Donna Mazloomdoost, a pelvic floor specialist at NIH, says, “Some women are just going to be very prone to these sort of conditions, and others are not.”

Depending on the condition, treatment options may include dietary changes, physical therapy, medications, medical devices, or surgery. NIH is funding studies to develop new and improved treatments.

“Most of the game-changing recommendations have come from studies that the Pelvic Floor Disorders Network has done,” says Mazloomdoost, who is the director of this NIH program. It funds some of the largest, multicenter pelvic health studies across the country.

A recent study from the network showed that women who urinate too often or leak urine may be treated successfully with Botox (botulinum toxin) injections. Another treatment that helps with bladder control uses a surgical implant to electrically stimulate the pelvic muscle nerves. Stimulating the nerves appears to help the bladder relax more.

“My first advice to all women with symptoms would be to see a pelvic floor specialist,” Mazloomdoost says. “Often times, physical therapy is the first treatment recommended because just about every pelvic floor condition will benefit from it. Some conditions, however, may need more than just physical therapy to get better.”

Pelvic floor physical therapy often begins with simple pelvic floor exercises. Some of these are known as Kegel exercises. They make the pelvic muscles stronger. Any woman can benefit from these exercises. Ask your health care provider how to do them correctly.

Mazloomdoost explains that Kegels performed at home may not work for some women with a pelvic floor condition. This may be because women don’t hold the exercises long enough, and they don’t do enough of them during the day.

“Physical therapy involves monitoring and measuring the amount of strength that the muscles are using and making sure that the correct muscles are being used—and for often enough and long enough,” she says.

Women who have a pelvic floor condition don’t have to suffer. Treatments are available. “If you have any problem with your bladder function or what your vagina feels like, then I think it’s absolutely important to speak with your doctor about it,” Mazloomdoost advises.

Lower Your Risk of Pelvic Floor Issues

  • Maintain a healthy weight.
  • Avoid constipation and straining by getting enough fiber and fluids in your diet.
  • Avoid tobacco smoke and triggers of a long-term cough, which weaken the pelvic floor.
  • Do Kegel exercises regularly to keep pelvic floor muscles toned. Ask your health care provider how to do them correctly.

Gay Pride

3/16: Do lies really spread faster than truth?

researchers found, “It took the truth about six times as long as falsehood to reach 1,500 people.”

Why are lies so much more powerful than the truth? The authors suggest “novelty” may be one answer: Fake news stories offer more of it than does real news.

I am frequently berated by people who don’t try to argue either the facts or my conclusion,

but indignantly demand to know how I would dare to say a true thing that might hurt some left-wing cause.

In 2011, I would never have imagined having to defend the act of telling the truth.

Megan McArdle

perhaps the real reason fake news spreads so far and so fast is not that we don’t know better; it is that we know exactly what we’re doing and, more and more, we feel free to do it. If you care more about winning a political argument than making true claims . . . well, the truth will do in a pinch, but a purpose-built lie is likely to work better. In that world, lies will get first-class tickets on the fastest transport available, while the truth will find itself slowed to a crawl — and becoming persona non grata whenever it strays into unfriendly territory.

EFM- she is right.

3/16:  the market for existing income management tools for new retirees is 3.5 million households.

Of 49.4 million working Americans with less than $50,000 in investable assets, 33 million “wish they were doing a better job saving.” Of these nearly 21 million have little or no debt and are poised to accumulate assets.

suggests there are fewer American households in the lowest asset group of less than $50,000 in investable assets. This group declined by 2.1 million, the only asset group to decrease in number of households during the past four years, even as the total number of households nationally increased by 3.5 million.

But then we have this

19% of Working Americans Are Not Saving Anything

Nearly 20% of working Americans are not saving any money, according to a survey. The number one reason they gave for not saving was having too many expenses, cited by 39%. Sixteen percent said their job isn’t good enough, 16% said they haven’t gotten around to it, and 13% said debt was preventing them from saving. Read more >

3/16:Global Property Investment Hits Record High Thanks To Asian Spending Spree

Global investment in real estate reached a new record high of $1.62 trillion (£1.17 trillion) in 2017, with Asian money making up more than half of all the capital spent. Read More

Should be interesting to see what happens as interest rates rise

3/16: Katy Perry Gave an American Idol Contestant His First Kiss. He Has Mixed Feelings About It

I review a lot of articles on a number of issues. But the above article was placed under "Important News". It will get a lot of reads. But news one 'needs to know?' Gimme a break- but it is what the average citizen will find more rewarding than another article about Syria.

3/16: Alzheimers

If you are providing care for a loved one living with Alzheimer’s, it might seem that the word “no” has become a natural response to any question. “Ready for your shower?” “No.” “Are you hungry?” “No.” “Would you like to play a game?” “No.” If you feel like you are living the “no”, here are a few approaches that just might help you turn a “no” into a “yes”.

First, let me say that the “no” is not your fault. While it can have something to do with approach, which we’re going to address, I’ve found that a “no” response is pretty common when caring for someone living with Alzheimer’s. You’ll need an arsenal of approaches. If one doesn’t work, pull out another. So be open to learning and being flexible, and don’t take the “no” personally. You’ll also need to respect the “no”. Time may be short, but giving your loved one a little space may give them the chance to relax, and a calm environment is much more conducive to a “yes” response.

According to, there are several ways to define the word approach, but a couple of them don’t really seem like good approaches for caregiving.

Approach - v.

  1. To make advances to; address
  2. To begin work on; set about
  3. To present, offer, or make a proposal or request

To “make advances to” sounds a bit like your heading in to battle. You never want providing care to feel like war. To “begin work on; set about” seems to imply you’re in charge, which can force your loved one into a “stand your ground” mode. If you start your caregiving tasks off following either of these two approaches, I would almost guarantee, you’ll get the “No”.

But let’s look at option 3. To “present, offer, or make a proposal or request”. Now, I believe we’re laying out the groundwork for a more successful outcome. Present the task, “It’s almost lunch time.” Offer choices, “Would you like your favorite soup today, or a chicken salad sandwich?” Propose or request, “Do you mind helping me in the kitchen?”

Tip #1

Offering choices whenever possible gives your loved one back a little of the control they may feel they have lost. Asking for help, offers them the opportunity to feel needed and sets them up for success.

Tip #2

How you “present, offer, or make a proposal or request” is also important. Five elements that I have found helpful include; smiling, greeting warmly, communicating thoroughly, remaining positive, and being patient. Here is a step by step example you might try if preparing to give a bath.

  1. Have a routine. Offer tasks like bathing at the same time/day of the week when possible.
  2. When you approach, smile and make good eye contact as you explain the task.
  3. Offer choices as you can. (Would you like a shower or a bath today? Would you like your bath now, or after the news? Do you want to try the new lavender soap, or your favorite rose scented soap?) Always give plenty of time for response and if too many questions seem to overwhelm your loved one, stick to those that require a simple yes/no response.
  4. If they respond “no”, respect that. Step back and try to redirect them away from the task at hand. Engage them in conversation about a favorite memory and give them time to relax. Then try again.
  5. Offer a favorite game, TV show, or snack once the task is complete. (“Mom, today is bath day. I bought some of your favorite Chocolate Ice Cream, would you like to have some after we’re finished with your bath?”)

Tip #3

We convey a whole lot more through our non-verbal communications, than our verbal. This quote is right on and a great tip for caregivers.

From - “Nonverbal communication is made up of tone of voice, body language, gestures, eye contact, facial expression and proximity. These elements give deeper meaning and intention to your words. Tone includes the pitch, volume and inflection of your voice. Eye contact suggests interest.”

Always be sure that your verbal and non-verbal communication are sending the same message of positivity. Respect your loved one’s personal space, and allow them the dignity of providing as much of their own care as possible. Making and holding good eye contact will help you know your loved one is tracking with you.

Tip #4

Now, we’ve looked at some of the approaches that I know do work. What about those that don’t? I have, unfortunately, witnessed examples of these too. Respect and dignity of others, should always be most important in caregiving. Negative approaches like those listed below can cause fear, anger, anxiety, frustration and a feeling that life is out of control, which leads to negative caregiving outcomes.

Approaches that won’t help overcome the “no”:

  1. Arguing
  2. Intimidating
  3. Demanding
  4. Physical force
  5. Threats/guilt

Instead try redirection. Change the subject or direction to draw your loved one from a negative to a positive. Using information that you know about your loved one, you can offer a favorite candy, start a conversation about a cherished memory, play a game they love, or break out in dance to their favorite music. Redirection is 1-part knowledge of your loved one, 1-part creativity, and 1-part common sense. Okay, redirection is bribery at its finest. I’m not ashamed to say that I’ve used it, I’ve loved it and I’ve gotten good results with it!



3/16: The fiduciary rule is all over the place

Trump wants the DOL rule terminated

“Look up at the stars and not down at your feet. Be curious, and however difficult life may seem, there is always something you can do.”

Steven Hawking


3/15 I stay away from a lot of politics unless there is something really annoys me. The idea of firing Tillerson via Twitter should go against anything in management. You do not do this to a a member of a cabinet. It is not only extremely bad judgement but unethical and just plain wrong.

Tillerson said that he “really hopes” that Donald Trump finds out that he is being impeached on Twitter.

“I mean, the way I see it playing out, he’s up at 3 a.m., starting a new feud with Oprah or someone, and that’s when he finds out,” Tillerson said. “My only regret is that I won’t be there to see it.”

Tillerson started laughing in what some witnesses described as a demonic manner as he imagined Trump learning of his impeachment on Twitter.

“I mean, you have to picture him with his BlackBerry in his itty-bitty hands, and that’s how he finds out,” Tillerson cackled. “It would serve the bastard right.”

EFM- I am to implying that everything that Tillerson did was outstanding. But a member of a selected team deserves better.

Further, if Trump  will do such to a member of his cabinet, why should other countries feel that they would be treated better. They won't. So there goes part of the trust that is needed with global entities. Second rate at best

3/15: Trump is still pussyfooting with Russia. Not so with Great Britain

Britain to expel 23 Russian diplomats in nerve agent case and will block all high-level contacts with Moscow

3/15: Just two stocks — Boeing and Goldman — have been responsible for keeping the Dow afloat this year

Goldman Sachs and Boeing have been responsible for all but a few points in the Dow gains this year.

  • All of the other 28 teams have been in aggregate flat for the year when taking into account the method by which the Dow is computed.
  • Lack of breadth is but one weak spot in the current bull market, says David Rosenberg, economist and strategist at Gluskin Sheff.

EFM- It is not that unusual to find but a few stocks in the SP 500 that are responsible for the bulk of the gains. It's just that you do not know which ones that will be

3/15: I was wondering if the S&P 100 beat the S&P 500. Ended up that it wasn't worth the effort

S&P 500                                                                                                                            S&P 100


3/14 Life insurance companies and variable life guarantees

 Offering variable annuity living benefits guarantees is not a traditional insurance company activity.

Life insurance agents may think trying to help retirement planning clients earn a decent return, while protecting the clients’ assets against a stock market crash, is a commonsense extension of letting variable annuity users control the investments used inside the annuities.

Leitner says the problem is that life insurers use their own assets, or “general account assets,” to back the minimum living benefits guarantees.

“These guarantees may kick in during an economic downturn, as when equity prices drop, adding stress to an already-stressed economy,” Leitner writes.

3/14: Arithmetic versus geometric returns

The proper way to calculate average investment returns is with a geometric mean that takes into account the compounding effects of a series of volatile returns over time. But crucially, the assumption of volatility always produces some level of drag on projected returns. This can make it difficult — though no less crucial — for advisors to be cognizant of whether they are unwittingly entering lower-than-intended return assumptions in their retirement projections.

The most common version of an average, taught to children in their early school days, is the arithmetic average or arithmetic mean — calculated by adding up all the individual items and dividing by how many there are.

This is effective in situations where the items being measured are independent of one another. The height of one student does not have any impact on the heights of the other students, and the exam score of one test taker doesn’t have any relationship to the others.

By contrast, in the world of investment returns, the results of one year are related to the results of the next, because both are being compounded on a dollar amount that grows in Year No. 1 before being reinvested or continuing to be held for investment in Year No. 2. As a result, a simple arithmetic return fails to capture the compounding effects that occur from a sequence of investment returns.

Example 1. From 2007 to 2016, the S&P 500 has posted the following annual total returns: 5.49%, -37.00%, 26.46%, 15.06%, 2.11%, 16.00%, 32.39%, 13.69%, 1.38% and 11.96%. The cumulative sum total of these returns is 87.54%, which would produce an average annual return of 8.75% over the 10-year time period. This means that a $10,000 investment would have grown to $23,144.74 over that decade.

And yet, an actual $10,000 investment in the S&P 500 over this time would have grown to only $19,568.08. The fact that the first year’s return was 5.49% meant that by Year No. 2, there wasn’t $10,000 invested to experience the -37% decline; rather, there was $10,549. And by the third year, there wasn’t $10,000 invested to experience the 26.46% recovery, as the portfolio would have been down to $6,645.87. And by the fourth year, the 15.06% return would have been experienced on only the $8,404.37 balance from the end of the prior year. And, so forth.

We all have a personal history. This backstory of your life not only impacts your identity, your life situation, and your relationships, but it also plays a major role when applying for life insurance. In our introductory article about sexual issues and life insurance, we discussed how backstory helps people who have had to overcome personal issues gain favorable treatment when they apply for coverage. It can be painful to dig up the past, but it is in your benefit to share your story.

Why Backstory Matters

The backstory narrative gives proper perspective to the physical, psychological, emotional, and lifestyle challenges that may become factors in your life insurance application. The truth is that many people have these challenges due to sexually-related experiences. If you feel comfortable and confident talking about them, then you can serve as your own best advocate during the prequalification and underwriting processes. Your broker, general manager, underwriter, and case manager can then approach the situation with more sensitivity and understanding and the ideal underwriting assessment available can be provided.3/14: Battery ships Shipbuilders in Norway are building some of the first ferries to be powered entirely by batteries. The country wants two-thirds of all boats carrying both passengers and cars along its Atlantic coastline to be electrified by 2030 (Bloomberg)

EFM- this really ramps up the viability of large batteries.  I think we may all thank Elon Musk. His trucks are already working in Arizona and got another contract for Alabama. And he got a large contract over in Europe.

3/14: Sample annuity rates.Rates for five years have crept up a little. But going long for 10 years is a little risky- not so much from the company but in viewing interest rates rising for awhile where rates should go higher.

3/14: Tillerson and the moron. OK, Trump and Tillerson did not see eye to eye. But, apparently, Tillerson found out he was fired via looking at one of Trump's tweets in the morning. That is moronic.

3/14: Interesting:

Kentucky's Answer To Abusive Hedge Fund, Private Equity Managers

A new bill proposed in Kentucky, House Bill 551, would subject hedge fund and private equity managers retained by the two major state pensions, as well as trustees, to possible criminal prosecution for not complying with ethical and fiduciary duties. Read More

Based upon ....forensic experience in Kentucky and with public pensions nationally, laws like this - with teeth in them - could be a positive step. However, strong laws require strong Attorney Generals to enforce them. As I noted in my last article, sadly, there's hardly an AG in the nation willing to take on Wall Street.

EFM: It is a lot easier to talk about your ethics than it is to live up to them. Very very few people I have known in the 40 years of this business are willing to stand up to bad characters.


Your Money Adviser

Interest on Home Equity Loans Is Still Deductible, but With a Big Caveat


The I.R.S. says that if the loan is used for home improvements, you can still claim the deduction. But if you’re paying off credit card debt, you can’t.

3/13: Where in the world is ................... North Korea. Of 1746 random people, only 36% got it right

Another disgrace of American intelligence/literacy

3/13: Algorithms

Algorithms are processes or sequences of instructions used to analyze data, solve problems and perform tasks. For example, when a consumer makes an online purchase, algorithms will commonly record the purchase and develop recommendations for other things the customer may want to buy from the online retailer.

The rise of advanced data analytics and cognitive technologies has led to an explosion in the use of algorithms across a range of purposes, industries and business functions. Decisions that have a profound impact on individuals are being influenced by these algorithms—including what information individuals are exposed to, what jobs they’re offered, whether their loan applications are approved, what medical treatment their doctors recommend, and even their treatment in the judicial system.

Algorithms can increase performance in an enterprise in many ways, by automating some existing processes and tackling new activities previously not feasible using manual processes. However, algorithms can, and do, go wrong and can have serious adverse effects when they do. In the online purchase example—in which an online purchase generates algorithmic recommendations for additional purchases—a wrong or offensive recommendation could cause the customer to avoid the retailer in the future. Multiply that across a class of customers and there is the potential for a business meltdown.

3/13: Volatility

More than three-fourths (83%) of RIAs and fee-based advisors said that their clients are concerned about a correction.

The vast majority (87%) have prepared clients’ portfolios for a correction—with top three solutions including holding more cash (53%), buying more international stocks (24%), and using more liquid alternatives (24%).

While focused on the importance of a long-term plan, RIAs and fee-based advisors say they will remain nimble in response to a market correction:
– 45% would manage portfolios more actively versus passively
– 45% would invest portfolios more aggressively versus conservatively
– 59% would increase equity exposure

Market corrections can be a healthy part of a continued bull market

Likewise, more than two-thirds (67%) say that now is a good time to invest in the market—with more than half (51%) saying stocks are appropriately valued, while more than one-third (36%) believe stocks are still overvalued.

3/13:as Prices Are Heading Back Toward $3 a Gallon Prices could get there again soon, according to Oil Price Information Service.

Rising oil prices are the clearest culprit: Brent crude prices have averaged $67.55 a barrel this year so far—the highest since 2014 when Brent averaged $107.88 a barrel through Feb. 26.

Demand is also rising both in the U.S. and abroad. U.S. refineries have become a fuel lifeline to much of the world, particularly in Mexico and South America which have been hobbled by operational issues.

And U.S. refiners that put off maintenance projects during Hurricane Harvey will likely have to get to that work now, with heavier maintenance planned for this year than normal, OPIS says.

3/13: Foreclosures


3/13: More than 40% of Americans may be at risk of going broke in retirement

The number of people who expect to retire “broke”, meaning they have less than $10,000 saved for retirement fell, to 42% from 55% last year, according to a survey by GoBankingRates. This also means that more than half of Americans have more than $10,000 saved for retirement. Now, knowing that estimates for out-of-pocket health care in costs in retirement are around $275,000 and climbing, having $10,000 saved up isn’t exactly comforting, but assuming the savers have awhile to go before retirement, it’s a start. (Look, we said it was good news, not great news.)

For older folks, low retirement balances are more dire. Adults 65 and older spend almost $46,000 a year, on average, according to the Bureau of Labor Statistics, so $10,000 in savings isn’t going to last very long.

Question: By your best estimate, how much money do you have saved for retirement?

Ages $0 Less than $10,000 $10,000-$49,999 $50,000-$99,999 $100,000-$199,999 $200,000-$299,999 $300,000 or more
18-34 18.18% 39.16% 6.69% 11.59% 8.69% 6.69% 8.99%
35-54 12.46% 24.43% 7.38% 15.35% 12.76% 10.67% 16.95%
55+ 10.56% 22.21% 5.98% 10.86% 14.64% 12.35%

3/13:Looking good

Close to 80% of executives said they were upbeat about the prospects for the U.S. economy, up from 74% who said so in the fourth quarter of 2017. Chief executives, chief financial officers and other certified public accountants are also more optimistic about the outlook for their own company, with 71% sharing that sentiment this quarter, up from 70% in the fourth quarter of 2017.

Executives — on average — expect revenue to grow by 5% in the coming 12 months, while profit is forecast to accelerate by 4.4%, the AICPA said in a statement. The share of executives that plan to expand their business ticked up to 72% in February, when the survey was conducted, from 71% in the fourth quarter.

The positive sentiment in part comes from the changes brought by the U.S. corporate tax overhaul that went into effect in January. Half of the respondents expect the new tax law to have a positive impact on their 2018 earnings, while 36% said they anticipate it will not make a difference.

3/12: Brookings Papers on Economic Activity

3/12: Mortgage risk

early ten years ago, the collapse of the sub-prime mortgage market sent the U.S. economy into a tailspin. As housing prices dropped and unemployment climbed, vulnerable households  found themselves unable to refinance  the  mortgages  they borrowed under better economic circumstances.  Struggling to meet  ever-increasing  monthly payments,  more and more  homeowners  defaulted on their  mortgages.

After the crisis, Congress and financial regulators increased regulation of  the credit risk associated with mortgage lending, including  the enforcement of stronger  underwriting standards. But according to new research published in the Spring 2018 edition of the Brookings Papers on Economic Activity, a boom in nonbank mortgage lending  means the mortgage market is still exposed to liquidity risk that very few people are talking about.


New tax law has implications for college-savings plans

Advisers are looking at ways the new tax law may affect families' college-savings plans. Key among them is the fact that parents will be able to use 529 plans to pay for private elementary and high school tuition, leading one adviser to note that discussing investment time horizons with clients who hold these accounts is essential.

3/12: Indexes

3/11:More annuity owners hanging on to contracts with GLIB riders

In 2007, more than 50% of the owners of fixed-indexed annuities with guaranteed lifetime income benefit riders surrendered their contracts within a year after the surrender charge period ended, but in recent quarters, that figure has fallen to 15%-25%, according to a study by the consulting firm Ruark. "From a financial adviser's standpoint, the data is emerging that folks are using the products in large measure for the purposes they were built for -- to provide an increased level of income in retirement,"

EFM- there are better ways of saving and using assets during retirement

3/11: Boy Syria stepped over our line in the sand and then kick sand in our face as wellNews Desk

A Surging Death Toll in Syria

Civilians in eastern Ghouta suffer through bombs, gas attacks, and fears of starvation in the latest assault by Russia and the Assad regime.

Assad and the Russians have won- at least so far.

3/10 Learn about Alzheiners

Every 66 seconds someone in the United States develops Alzheimer’s disease.

Nearly 50% of patients when diagnosed with Alzheimer's disease are already in the moderate to severe stage.

3/10:OIL- Good overview. I usually check the number of rigs going up or down. The overall concern I have is still about fracking and the amount of contaminants found in ground water and the issue. of earthquakes.

Oil prices jumped on Friday following a drop in U.S. oil rigs, a strong jobs report, and news that the Trump tariffs would be selectively implemented. 

Important Note for Energy Investors: The World Economic Forum, the Institute of Electrical and Electronics Engineers, the MIT Technology Review, prestigious national laboratories, and a slew of other experts are buzzing about this new element that will transform the energy industry. Early investors are already reaping the benefits. Are you in? 


National Council on Seniors Drug & Alcohol Rehab:


Across the globe

  • A magnitude- 7.5 earthquake struck Papua New Guinea on Feb. 26, killing at least 75 people and injuring more than 500 others.
  • Two winter storms led to widespread travel disruption in the U.S.
  • South America recorded multiple big flood events in February, with parts of Brazil, Bolivia and Argentina affected. Total economic damage exceeded $200 million (USD) to property, infrastructure and agriculture.
  •  Cyclone Gita impacted several island nations in the South Pacific Ocean, causing significant damage in parts of Tonga, Fiji, Samoa, American Samoa, New Caledonia, and New Zealand. Damage to infrastructure and public structures alone was estimated as being up to $50 million (USD).


U.S. economy adds 313,000 jobs in February, beating expectations

The U.S. economy gained a whopping 313,000 jobs in the month of February, blowing economists' expectations of 205,000 out of the water.

Monthly data released Friday morning by the Bureau of Labor Statistics showed that for the fifth straight month, unemployment held at a steady rate of 4.1 percent — still the lowest level in 17 years. The only black cloud was wage growth, which was up just 0.1 percent.

3/8; Best rate I have seen currently. However I do not know the AM Best rating. Must be at least A- and corroborated by S&P and more

3.5% FOR 5 YEARS

  • Available in most states
  • $2500 minimum deposit
Issues to age 90

3/8:Remodeling Retirement for the 21st Century

“That’s the crux of the problem,” he said. “The current system dictates that we all work longer and are less of a burden on society, and the current reality is that it’s getting increasingly hard to remain relevant in the workforce over time.”

Raising awareness among employees on the psychology of retirement can start when employees are in their 40s or 50s rather than when they’re close to 65,

Some employees may feel that after retiring they won’t be relevant anymore, he said. Employers could help by offering resources including articles, books, videos and workshops that educate people on the changes they’ll experience during retirement. Former employees may struggle staying connected with other people, and losing that social component of what work provides can make them feel disconnected.

EFM- - I don't think employees will read the stuff. People simply do not read. And they have a real tough time in putting any insights to use. Retirement will go from problematic to chaos as the years go by. 

“The long-term risk companies could face if their employees come up short later in their careers is that many of these individuals will hang around beyond when they want and beyond when their employer wants, too,” he said. “More of these individuals hanging on tend to be less healthy, feel stuck, disengaged and ultimately that means they are less productive.”

Not only are employees financially unable to take the brunt of the financial risk, but they’re not going to be able to make better decisions than an expert investor. And although employers should educate their employees, they should also understand that they can only do so much, he said.

“You can’t teach employees to be great investors,” said Sher. “You want them to work at their jobs. You don’t want them to be worried about and focusing on what I’m going to do with this money in my 401(k) plan. You want to engage employees in a discussion, but you don’t want to overwhelm them.”

EFM- If ANY company uses an educator who does not know or understand the inverted yield curve- you got a schmuck. Since 1955. it has been a 100% indicator of a recession. But in recent discussion on the subject with some heavy hitters at Advisors ,.......... they were clueless. 10,000 Monte Carlos and more computations than one can imagine or comprehend, not a one used the Inverted Yield Curve. That is simply a breach of a fiduciary duty

3/8:Emerging Market Debt

“The premise on which lenders keep lending to borrowers as they become more indebted is that the backdrop will stay benign,” says Sonja Gibbs, senior director for global capital markets at the Washington-based Institute of International Finance, an industry association. With political uncertainty on the rise around the world, she says, “it feels more like there is the potential for events to trigger volatility in emerging markets than it has done for some time”.

The reason for the growing concern is clear. Among a group of 21 developed markets monitored by the IIF, the combined outstanding debt of households, governments, corporations and financial institutions rose from the equivalent of about 290 per cent of their combined gross domestic product at the end of the 1990s, to 380 per cent at the end of 2008. Since then, it is broadly unchanged. But, since the crisis, debt in emerging markets has surged. In China, it rose from 171 per cent of GDP at the end of 2008 to 295 per cent at the end of last September. The combined debts of a group of 26 large emerging markets monitored by the IIF rose from 148 per cent of GDP at the end of 2008 to 211 per cent last September.

3/8: Oil.

In today’s newsletter, we will take a quick look at some of the critical figures and data in the energy markets this week. 

We will then look at some of the key market movers early this week before providing you with the latest analysis of the top news events taking place in the global energy complex over the past few days. We hope you enjoy.

Important Note for Energy Investors: The World Economic Forum, the Institute of Electrical and Electronics Engineers, the MIT Technology Review, prestigious national laboratories, and a slew of other experts are buzzing about this new element that will transform the energy industry. Early investors are already reaping the benefits. Are you in? 

Chart of the Week

The IEA warned that the oil industry was not investing enough in new supply, a problem that could become clear in the 2020s. 
-    Spending on conventional oil fields jumped by 57 percent in 2017 to $112 billion, targeting 11 billion barrels of oil.
-    But the figures are a small fraction of the pre-2014 investment levels, and could create problems beginning in the early 2020s.

3/7:"'Since You're so Rich, You Must Be Really Smart': Talent and the Finance Wage Premium" Fee Download
CEPR Discussion Paper No. DP12711

MICHAEL J. BÖHM, University of Bonn
Stockholm School of Economics - Department of Finance, London School of Economics & Political Science (LSE) - Financial Markets Group, Swedish House of Finance
Swedish House of Finance

Wages in the financial sector have experienced an extraordinary increase over the last few decades. A proposed explanation for this trend has been that the demand for skill has risen more in finance compared to other sectors. We use Swedish administrative data, which include detailed cognitive and non-cognitive test scores as well as educational performance, to examine the implications of this hypothesis for talent allocation and relative wages in the financial sector. We find no evidence that the selection of talent into finance has improved, neither on average nor at the top of the talent and wage distributions. A changing composition of talent or their returns cannot account for the surge in the finance wage premium. While these findings alleviate concerns about a "brain drain" into finance at the expense of other sectors, they also suggest that finance workers are capturing substantial rents that have increased over time.

3/7: To your health

A new report from the nonpartisan Employee Benefit Research Institute (EBRI) notes that move toward consumer-driven health plans (CDHPs) and high-deductible health plans (HDHPs) may be causing financial stress for the same workers that employers are targeting with financial wellness programs.

The report explains that there is evidence that higher health care costs cause many workers to report signs of financial struggles. Of the workers reporting cost increases in their health care plans in the past year, a quarter (26%) state that they have decreased their contributions to retirement plans, and more than 4 in 10 (43%) have decreased their contributions to other savings. Moreover, 27% have delayed retirement, and 15% have taken a loan or withdrawal from a retirement plan.

Additionally, according to the report:

28% have had difficulty paying for basic necessities such as food, heat and housing
36% have had difficulty paying other bills
30% have used up all or most of their savings
34% have increased their credit card debt
22% have borrowed money
27% have delayed retirement
19% have dropped other insurance benefits
15% have taken a loan or withdrawal from a 401(k) or IRA
13% have purchased additional insurance to help with expenses

EFM- those are not pretty numbers when close to retirement

3/7: Just plain sad

"The Price of Gold: Dowry and Death in India" Fee Download
CEPR Discussion Paper No. DP12712

SONIA BHALOTRA, University of Essex
University of Manchester
Bocconi University - Department of Economics

We provide evidence that dowry costs motivate son-preferring behaviors in India. Since gold is an integral part of dowry, we study parental responses to shocks in the world gold price. Exploiting monthly variation in gold prices across 35 years, as well as an event study around a massive gold price hike in December 1979, we find that monthly changes in gold prices lead to an increase in girl relative to boy neonatal mortality and that the surviving girls are shorter. After the introduction of prenatal sex determination technology, we find that gold price shocks increase female foeticide

3/7: Correction and advisors

More than three-fourths (83%) of RIAs and fee-based advisors said that their clients are concerned about a correction.

The vast majority (87%) have prepared clients’ portfolios for a correction—with top three solutions including holding more cash (53%), buying more international stocks (24%), and using more liquid alternatives (24%).

While focused on the importance of a long-term plan, RIAs and fee-based advisors say they will remain nimble in response to a market correction:
– 45% would manage portfolios more actively versus passively
– 45% would invest portfolios more aggressively versus conservatively
– 59% would increase equity exposure

Market corrections can be a healthy part of a continued bull market

Likewise, more than two-thirds (67%) say that now is a good time to invest in the market—with more than half (51%) saying stocks are appropriately valued, while more than one-third (36%) believe stocks are still overvalued.

3/7: Here is a few numbers totally unrelated to financial drivel

Today’s number: 1,610 That’s the number of people in the U.S. who were killed in encounters with animals from 2008 to 2015. (Not a lot for 7 years)

Of that number, 478 were killed by hornets, wasps and bees, and 272 by dogs. (thought that there would be more dogs involved)

3/7:Only One In Four Women Expect Life To Be Better In Retirement

Social Security provides critical income for many American women. In fact, 62 percent of women say Social Security will be their primary source of retirement income. So it's no wonder women are increasingly concerned about its viability and their happiness in retirement.

3/7:Affordable Colleges Online -

3/7: Gotta fix this

People would not have to work in retirement if they saved enough during their career, but that brings up another concern. A third of U.S. workers aren’t offered a pension or 401(k) plan by their employers, according to the Pew Charitable Trusts. That percentage is higher for certain groups of people. Fifty-six percent of part-timers, 55 percent of Hispanics and 45 percent of millennials don’t have access to a retirement plan.

3/7: Medical Insurance Board

3/7: Down syndrome is front-and-center in the states' latest abortion battles. Utah’s legislature is debating a bill making it illegal for a woman to seek an abortion “solely” because the fetus has Down syndrome. The bill’s supporters argue it will prevent discrimination against those who have the condition, while opponents (including the ACLU and Planned Parenthood) say such bills are unconstitutional.

This type of legislation is simply a 'bridge too far'.

3/7: Is this a new 'line in the sand?' Yes it is. And the comment to 'continue monitoring the situation' while Syria is allowed to keep up chemical warfare is a slap in the face to our military and citizens.

Trump requested options last week for punishing the Syrian government following reports of chlorine gas attacks — raising the prospect of a second U.S. strike on the Assad regime in less than a year. Karen DeYoung, Missy Ryan, Josh Dawsey and Carol Leonnig report: “The president discussed potential actions early last week at a White House meeting that included [John Kelly, H.R. McMaster and Jim Mattis]. One official … said the president did not endorse any military action and that officials decided to continue monitoring the situation. One senior administration official said that Mattis was ‘adamantly’ against acting militarily … and that McMaster ‘was for it.’ The prospect of renewed military action, even if tabled for now, underscores the explosiveness of a conflict that has become a battlefield for rivalries between Russia and Iran on one side and the United States and its allies on the other.”


“How Medicaid Helps Older Americans”

By Steven A. Sass

The brief’s key findings are:

  • Medicaid provides low-income retirees with critical health benefits by offering insurance directly, covering Medicare costs, or paying for long-term care. 
  • Recently, the Medicaid expansion has also helped reduce the uninsured rate among workers nearing retirement.
  • The need for this array of benefits will grow as the population ages and medical costs continue to rise faster than household incomes.
  • But older Americans are only a small part of Medicaid, so their future depends on the outcome of the broader debate over the program’s size and scope.

Medicaid is generally not the first program that comes to mind when discussing government health care for older Americans. Its counterpart, Medicare, is the primary health insurance program for seniors of all income levels, while Medicaid’s beneficiaries span a broad age range and typically have low incomes. However, Medicaid does offer critical benefits to many retirees and those approaching retirement. For eligible retirees, Medicaid provides insurance directly or pays their Medicare premiums and co-pays. It is also the single largest source of long-term care support for the elderly, covering about half of total spending on these services. Finally, in states that adopted the Medicaid expansion under the Affordable Care Act, the program insures about one out of six Americans approaching retirement.1 This brief offers a primer on the role of Medicaid for retirees and near-retirees. The discussion proceeds as follows. The first section reviews Medicaid benefits for the elderly, ages 65 and over. The second section reviews benefits for those approaching retirement, ages 50-64. The third section discusses how these groups, particularly those 65 and over, fit within the context of the larger Medicaid program. The final section concludes that the need for Medicaid benefits by older Americans will rise as the population ages and medical costs continue to increase faster than household incomes. Whether Medicaid meets this need depends on the outcome of the ongoing policy debate over the size and scope of the program

3/7: Incontinence

3/7: Medical Insurance Board

MIB Actuarial and Statistical Group

The MIB Life Index is the life insurance industry's timeliest measure of application activity across the U.S. Released to the media in the second week of each month, the Index is based on the number of searches member company underwriters perform on the MIB Checking Service database. Since the vast majority of individually underwritten life premium dollars in the U.S. include an MIB Check as a routine underwriting requirement, the MIB Life Index provides a reasonable means for estimating new business activity.


  1. Honesty in the digital age




Alain Cohn ; Tobias Gesche ; Michel Maréchal

Modern communication technologies enable efficient exchange of information, but often sacrifice direct human interaction inherent in more traditional forms of communication. This raises the question of whether the lack of personal interaction induces individuals to exploit informational asymmetries. We conducted two experiments with 866 subjects to examine how human versus machine interaction influences cheating for financial gain. We find that individuals cheat significantly more when they interact with a machine rather than a person, regardless of whether the machine is equipped with human features. When interacting with a human, individuals are particularly reluctant to report unlikely favorable outcomes, which is consistent with social image concerns. The second experiment shows that dishonest individuals prefer to interact with a machine when facing an opportunity to cheat. Our results suggest that human interaction is key to mitigating dishonest behavior and that self-selection into communication channels can be used to screen for dishonest people.


Cheating, honesty, private information, communication, digitization, lying costs


C99 D82 D83


"We are what we repeatedly do. Excellence, then, is not an act but a habit."


3/6:Currency markets send a warning on the US economy

If Larry Summers talks, you have to listen. (As with all things, you do not have to agree but you do have read.) In this comment, I do agree

Dropping dollar: Lawrence Summers argues that the combination of rising US interest rates and the decline of dollar against many major currencies reflects deepening investor skepticism about the direction of US policy. Pointing to the newly announced steel tariffs as well as to increases in the federal deficit despite a healthy economy, he warns that “currency markets are sending a signal that the US is not on a healthy path”.

It is instructive to consider what the combination of interest rates and current exchange rates says about market expectations of future currency values. US 10-year interest rates are about 230 basis points above German rates and about 280bp above Japanese rates. This implies that markets expect depreciation of the dollar by more than 25 per cent against its major competitors over the next decade. If dollar depreciation of this magnitude was not expected, investors would prefer dollar assets to foreign assets, given the interest rate differentials. Some but probably less than half of the dollar’s weakness can be explained by higher than expected inflation in the US. Real interest rates imply an expectation of continuing real depreciation.

The pattern of higher interest rates and a weakening currency suggests that on multiple dimensions US assets now have to be put on sale to convince foreigners to hold them or induce Americans not to diversify into overseas assets. This pattern is relatively uncommon in the US though it happened in the Carter administration before Paul Volcker’s appointment as chair of the Federal Reserve and in the Clinton administration before Treasury secretary Robert Rubin’s invocation of the “strong dollar” policy. It is fairly ubiquitous in emerging markets where it reflects anxiety over a country’s policy framework. I fear such anxiety may be emerging in the US. Mr Trump and Treasury secretary Steven Mnuchin show their ambivalence about a strong currency. Washington consciously takes budget deficits way up in a full-employment economy. Questions arise with respect to the Fed’s independence, America’s traditional receptivity to foreign investment and its willingness to lash out at holders of dollar assets.

The confidence of global markets is much easier to maintain than to regain. Currency markets are sending a signal that the US is not on a healthy path. Its time for the US to strengthen the strong fundamentals on which a strong dollar and healthy economy depends

a growing number of people in their 50s and 60s who desperately want or need to work to pay for retirement and who are starting to worry that they may be discarded from the work force — forever.

Of the 14.9 million unemployed, more than 2.2 million are 55 or older. Nearly half of them have been unemployed six months or longer, according to the Labor Department. The unemployment rate in the group — 7.3 percent — is at a record, more than double what it was at the beginning of the latest recession.

After other recent downturns, older people who lost jobs fretted about how long it would take to return to the work force and worried that they might never recover their former incomes. But today, because it will take years to absorb the giant pool of unemployed at the economy’s recent pace, many of these older people may simply age out of the labor force before their luck changes.

The most recent recession has increased the need to extend working life. Home values, often a family’s most important asset, have been battered. Stock portfolios are only now starting to recover. According to a Gallup poll in April, more than a third of people not yet retired plan to work beyond age 65, compared with just 12 percent in 1995

Forced early retirement imposes an intense financial strain, particularly for those at lower incomes. The recession and its aftermath have already pushed down some older workers. In figures released last week by the Census Bureau, the poverty rate among those 55 to 64 increased to 9.4 percent in 2009, from 8.6 percent in 2007.

Older people who lose their jobs take longer to find work. In August, the average time unemployed for those 55 and older was slightly more than 39 weeks, according to the Labor Department, the longest of any age group. That is much worse than in August 1983, also after a deep recession, when someone unemployed in that age group spent an average of 27.5 weeks finding work.

At this year’s pace of an average of 82,000 new jobs a month, it will take at least eight more years to create the 8 million positions lost during the recession. And that does not even allow for population growth.

3/.6: A tip for homeowners, mechanics and more,

If you have a can of raid, paint, oven cleaner, etc., that has been around for awhile and there is hardly any pressure left, do this: step on the can hard so you make a dent. If necessary do it again and maybe again. The smaller can has therefore compressed the gases into a smaller space and you should get at least a little more spray.

Please send a gift


  1. What is the Sharpe Ratio, and how can everyone get it wrong?




Igor Rivin

The Sharpe ratio is the most widely used risk metric in the quantitative finance community - amazingly, essentially everyone gets it wrong. In this note, we will make a quixotic effort to rectify the situation.


3/5: Essays in the Economics of Corruption: Experimental and empirical evidence




Nastassia Leszczynska

The advent of experimental methodologies have led to decisive progress in the study of corrupt behaviour in the last two decades. Since they can complement survey data and perception indexes with controlled experimental data, scholars and policy makers have reached a better understanding of decision-making in bribery situations and are able to design innovative anticorruption policies.In this thesis, I use experimental and empirical data to contribute to the field of the economics of corruption. The first two chapters of this PhD dissertation use experimental methodologies to study decision-making in a bribery scenario. The first chapter tests an anti-corruption strategy with a lab in the field experiment in Burundi. The second chapter studies the fairness concerns that might arise when dealing with redistribution in a bribery situation. The third chapter uses an empirical analysis to explore the controversial issue of political moonlighting, i.e. having outside activities while holding public office. It investigates "double-hat politicians", who combine mayor and parliamentary positions in Wallonia.In a first chapter, written with Jean-Benoit Falisse, we explore the effect of anti- corruption messages on corrupt behavior and public service delivery. In a novel lab-in-the-field experiment, 527 public servants from Burundi were asked to allocate rationed vouchers between anonymous citizens; some of these citizens attempted to bribe the public servants to obtain more vouchers than they were entitled to. Two groups of public servants were randomly exposed to short messages about good governance or professional identity reminders. Participants in these two groups behaved in a fairer manner than those of a third group who were not exposed to any message. The result is more robust in the case of the group exposed to the professional identity reminder. The underlying mechanisms seem to be that when a public servant reflects upon governance values and her professional identity, the moral cost increases, prompting more equal service delivery. Bribe-taking was not impacted by the messages. The experiment provides new insights into the design of anti-corruption strategies.The second chapter, written with Lena Epp, investigates the impact of a public officials’ fairness considerations towards citizens in a petty corruption situation. Other-regarding preferences, and, more particularly, fairness concerns are widely acknowledged as crucial elements of individual economic decision-making. In petty corruption contexts, public officials are to a large extent aware of differences between citizens. Here, we experimentally investigate how fairness considerations may impact on corrupt behaviour. Our novel bribery game reveals that bribes are less frequently accepted when bribers are unequal in terms of endowments. These results suggest that fairness considerations can influence corrupt behaviour.In the last chapter, I focus on political moonlighting in Wallonia. Activities outside of public office or combining specific public offices simultaneously is a topic of ongoing heated debates. An element crucial to these discussions is whether moonlighting is detrimental for politicians’ performance. In Belgium, the combination of local executive and regional legislative offices, i.e. double hat politicians, is a frequent habit for a majority of politicians. This accumulation of activities might lead to (un-)desirable outcomes in terms of political achievements. This chapter investigates the impact of holding several remunerated and honorary positions on regional MPs parliamentary activities and mayor’s municipality performance in Wallonia. I use a database of all public and private positions held by Belgian politicians in Wallonia since the disclosure of positions became compulsory for those holding at least one public position, i.e. from 2004 to 2016. For members of Parliament, wearing a double hat reduces global parliamentary activity. For mayors, it seems that holding more remunerated positions is associated with less efficient municipality management.


corruption; experimental economics; behavioural games; public service delivery; fairness; political moonlighting; bribery game; messages; rank reversal aversion

3/6: A problem????

Posting its largest drop in more than six years, China's manufacturing PMI fell to 50.3 this month, down a point from January. It also marks the gauge's nearest brush with the 50-point mark that separates growth from contraction since August 2016. China's statistics bureau attributed the slowdown to the Lunar New Year, when output typically dips.

3/6: Zero sum game????

Antifragility, Path Dependency and Value Investing (Part 1)

by Vitaliy Katsenelson, Mar 2

Acquisitions have the elements of a zero sum game. Both buyer and seller need to feel that they are getting a good deal. The seller has to convince his board and shareholders that they are selling at high (unfairly good) price. The buyer needs to convince his constituents that they are getting a bargain. Remember, both are talking about the same asset.

EFM- not necessarily a zero sum game. When you sell mutual funds out as a recession starts, you are eliminating risk. You are not attempting .some special buy/sell when you read these other articles- and he presents some good stuff since I have read him for some time-don't look at it that somebody thins you are wrong because they think it will go up and YOU are the one that may be wrong. Stop right there. Very few people in teh market act unemotionally. But when you get to phase three of my Process, it is all mechanical. 

3/6: Trump’s tariffs 'could not have come at a worse time' for anyone planning to buy a home. "Given that homebuilders are already grappling with 20% tariffs on Canadian softwood lumber and that the price of lumber and other key building materials are near record highs, this announcement by the president could not have come at a worse time,"

EFM- there was no game plan for these tariffs. Trump just got teed off last week when too many things were going wrong and just decided without conference with officials to do it. This will be very messy.

3/5:Capital Asset Pricing Model

Assumptions of Capital Market Theory, Markowitz-Style

The following assumptions apply to the base theory:

  • All investors are risk averse by nature.
  • Investors have the same time period to evaluate information.
  • There is unlimited capital to borrow at the risk-free rate of return.
  • Investments can be divided into unlimited pieces and sizes.
  • There are no taxes, inflation or transactions costs.

Due to these premises, investors choose mean-variant efficient portfolios, which by name seek to minimize risk and maximize return for any given level of risk.

Copyright © 2009

The initial reaction to these assumptions was that they seem unrealistic; how could the outcome from this theory hold any weight using these assumptions? While the assumptions themselves can easily be the cause of failed results, implementing the model has proved difficult as well.


While CAPM still leads the pack as one of the most widely studied and accepted pricing models, it is not without its critics. Its assumptions have been criticized from the start as being too unrealistic for investors in the real world. Time and time again empirical studies successfully dissect the model.

Factors like size, various ratios and price momentum provide clear cases of diversion from the model's premise. This ignores too many other asset classes to be considered a viable option.

3/5: Limited Liability Partnerships (LLP) (Investopedia)

The basics described

LLPs are a flexible legal and tax entity that allows partners to benefit from economies of scale by working together while also reducing their liability for the actions of other partners. As with any legal entity, it is important that you check the laws in your nation (and your state) before getting too excited. In short, check with your lawyer first.

And we allow people like this to breed

3/5: Smaller, cheaper hospitals???

As treatment costs in traditional hospital settings continue to escalate, health care providers are increasingly shifting to smaller facilities for both inpatient and outpatient care — including “hospital-at-home” care. Meanwhile, many traditional hospital facilities are being repurposed for specialized care.

For all types of facilities, health care providers are increasingly using telemedicine, as well as data analytics to improve their delivery of care, as well as enhance preventative medicine.

In many locales including rural markets, providers are building free-standing emergency rooms and “microhospitals,” or neighborhood hospitals that typically include emergency rooms and beds for short-stay recovery. Nearly all (92 percent) of patients who come to the microhospitals are treated and sent home in an average of 90 minutes, and 8 percent are admitted overnight for care such as intravenous-medication administration

3/5: Another Syria???? It;s Venezuela

The massive scale of the exodus is being compared to the flow of Syrians into Western Europe in 2015. And, just as in that crisis, countries overwhelmed by the flood of new arrivals are beginning to bar their doors, seeking to contain an influx of Venezuelans fleeing a collapsing economy and an increasingly repressive socialist regime.

3/5: And Ethiopia- isn't any better

Ethiopia appears to be on the brink of the biggest political crisis since the communist regime was overthrown in 1991.

“There is a huge change in this country, especially the region we live in, the Oromia state,” said Gerba, from his home city of Adama, where people kept stopping him to pose for selfies. “We feel that some kind of air of freedom is here, but this is regarded by the federal government as a threat.”

On Friday, Parliament ratified the state of emergency. Although the ruling coalition controls all 547 seats, an unprecedented 88 deputies voted against the measure.

Eto crossing a line in the sand. FM- most of the news focuses on Russia and Russia. But a lot of other countries are in a mess. I do find that the loss of Syria is due to the inaction of the U.S. Other element tend to appear on news stations- and that is solely regarding the latest tweet.

3/5: homes
bank repossessions across the U.S. fell to an 11-year low in 2017


3/4 Index Monthly Performance Report (as of 2/28/18)

3/4: I note this below

One of the financial industry’s most astute crisis callers has just told Barron’s that she thinks we are in for another financial crisis. Sheila Bair, former head of the FDIC, has successfully called the Enron scandal and the subprime crisis, and now she sees another one looming. The context is that Trump and the White House are leading the charge for less bank regulation, which Bair sees as crazy given this point in the cycle. According to her, “To loosen capital now is just crazy. When we get to a downturn, banks won’t have the cushion to absorb the losses. Without a cushion, we will have 2008 and 2009 again.”.

3/4: Recessionary babies

3/4:Steel Producers

EFM- I thought Japan exported a lot more than this shows. And I sure did not know that Canada exported that much.

3/4: When something goes right, few people make compliments. It it is bad, many may tend to make a complaint. Same with voting

The “feeling thermometer scale” asks voters to rank candidates and institutions on a scale of 0 to 100, in which 100 is very warm or favorable, zero is very cold or unfavorable and 50 is neutral or no feeling.

The accompanying graphic shows that both Democrats and Republicans had favorable views of their own candidates from 1968 to 2012, ranging from 76.5 percent in 1968 to 78.5 percent in 2012. In 2016, however, with Trump and Clinton as the nominees, the thermometer rating dropped sharply to 60.9 percent.

3/4: Quantum computers

Unlike classic computers, in which information is represented in 0’s and 1’s, quantum computers rely on particles called quantum bits, or qubits. These can hold a value of 0 or 1 or both values at the same time — a superposition denoted as “0+1.”  They solve problems by laying out all of the possibilities simultaneously and measuring the results. It’s equivalent to opening a combination lock by trying every possible number and sequence simultaneously.

in May 2016, IBM surprised the world with an announcement that it was making available a 5-qubit quantum computer on which researchers could run algorithms and experiments. It envisioned that quantum processors of 50 to 100 qubits would be possible in the next decade. The simultaneous computing capacity of a quantum computer increases exponentially with the number of qubits available to it, so a 50-qubit computer would exceed the  capability of the top supercomputers in the world, giving it what researchers call “quantum supremacy.”

3/4:Telling clients not to panic may be a wrong move, expert says

While stock market corrections occur regularly, the latest one seems to have caused undue concern as it follows an unusually long period of stability, writes adviser Dan Moisand, CFP®. He argues that advising clients not to panic may seem like a sound strategy but it could actually increase their unease, and adds: "A better approach is first to be crystal clear that no one truly knows if this will get worse but historically the unknowability of the future has not been a problem if a good plan is in place."

EFM- And this is where the rubber meets the road. What s a good plan? Is it from a package that has a 'high' rating (by whom or what)? What did the adviser do in 2000 or 2008? What currently is her/his comment on the inverted yield curve? What is the risk of loss on the funds projected to be used?.

3/4: Financial satisfactionf

As people get older, they tend to become more at peace with their finances, survey research shows. But not the current crop of middle-aged Americans.

Let’s call them the Grumpy Middle.

They are unhappier than previous generations. And they’ve been this way for years.

The comment about the unknowability of the future is not valid on its face. One knows there will be a recession, possibly one each decade. The plan/advisor must already have certain ducks in order.

3/4: Standard deviations

3/4:The new Fed chairman just dropped a huge hint that controversial emergency measures will again be needed in the next recession. During his testimony in front of the Senate Banking Committee Thursday, Fed Chairman Jerome Powell dismissed calls to tweak the central bank's 2% inflation target and brushed aside a new paper downplaying the effectiveness of quantitative easing. Taken together, the two suggest the Fed could use QE as a tool during the next recession. 

EFM- but should anything  happen now, we are going to be for a big hurt. Interest rates are so low a reduction in rates may not jump start the economy again. And we would definitely see negative rates. And the deficit would be SO LARGE...................


3/4: Cost of Insurance

For the holder of a universal life policy, the COI charge is the amount paid to support the value of the underlying death benefit, and the value of any riders or other supplemental benefits. Life insurance buyers once thought of the COI charge as a number that rarely, if ever, changed, but many life insurers have increased UL policy COI charges in recent years.

Sheridan has developed a mathematical model that suggests that life insurers are especially likely to impose COI increases on older, underpriced policies.

Sheridan said his model implies that life settlement investors may have to think more about COI increase risk when buying life insurance policies

3/4: This is wrong Employer retirement plans are getting more bells and whistles

Companies are beefing up their retirement offerings by increasing employer contributions, adding Roth 401(k) options, offering target-date funds and making other changes, according to a Willis Towers Watson survey

EFM-The point being that target date funds have merged into managed funds that can hold pretty much whatever they want and when the want. That's tough enough but the use of bonds as the FED is raising rates is bound to cause some significant loss of value

3/4: Unbelievable gains- just the wrong kind

3/2: “The cost of care, MRIs, hospital visits and prescription drugs all drive the rise in healthcare spending,” ......... frequently hear from large employers that a small percentage – estimated 13% – of the employee population is driving 82% of spending.”

3/2: Rubbish              scientists estimated that 8.3 billion metric tons of plastic had been produced since the 1950s.

EFM-And most of it is still around

3/2: FDIC guarantee

Bank customers have enjoyed the security and protection provided by the Federal Deposit Insurance Corporation (FDIC) knowing their savings deposits are backed by the full faith and credit of the U.S. government for up to $250,000 per account.

3/2: India dethrones China as the fastest-growing major economy. India's economy grew by 7.2% in the December quarter, overtaking China's, which grew by 6.8%.

3/2: So, is Russia also going to push us around?? Actually it has for a long period and is now costing us millions in depositions and thousands of hours of time.

Russia has developed a new cruise missile that is invincible, according to Russian President Vladimir Putin. He made the announcement in his annual state of the nation address in Moscow, adding that the weapon could reach anywhere in the world. (BBC)

3/2: Syria is far over our 'line in the sand'-
With the support of Russia and Iran, warplanes have been pounding the suburban Damascus area known as Eastern Ghouta, targeting hospitals, apartment buildings and other civilian sites. In the week that ended last Sunday, relief organizations reported at least 541 people killed and 1,500 wounded. On Sunday, hours after the U.N. Security Council passed a resolution mandating a 30-day cease-fire, the offensive intensified: Ground forces launched an assault on five fronts, and opposition sources reported that chlorine gas had been used in at least one area. Putin is doing his best to bluff and intimidate President Trump into ordering a withdrawal.

EFM- we lose another fight/war if we withdraw. But if we stay, the reults may be no more different. We drew a line in the sand through Obama and everybody has crossed it with no repercussions.


"Market Discipline and Systemic Risk" Fee Download
CEPR Discussion Paper No. DP12689

ALAN D. MORRISON, University of Oxford - Said Business School, University of Oxford - Merton College
University of Warwick - Warwick Business School

We analyze a general equilibrium model in which financial institutions generate endogenous systemic risk, even in the absence of any government support. Banks optimally select correlated investments and thereby expose themselves 1.

“The bitterness of poor quality remains long after the sweetness of low price is forgotten”

Benjamin Franklin

3/2: Dalbar

While the inability to participate in the financial markets is certainly a major issue, the biggest reason for underperformance by investors who do participate in the financial markets over time is psychology. Behavioral biases that lead to poor investment decision-making is the single largest contributor to underperformance over time. Dalbar defined nine of the irrational investment behavior biases specifically:

  • Loss Aversion – The fear of loss leads to a withdrawal of capital at the worst possible time. Also known as “panic selling.”
  • Narrow Framing – Making decisions about on part of the portfolio without considering the effects on the total.
  • Anchoring – The process of remaining focused on what happened previously and not adapting to a changing market.
  • Mental Accounting – Separating performance of investments mentally to justify success and failure.
  • Lack of Diversification – Believing a portfolio is diversified when in fact it is a highly correlated pool of assets.
  • Herding– Following what everyone else is doing. Leads to “buy high/sell low.”
  • Regret – Not performing a necessary action due to the regret of a previous failure.
  • Media Response – The media has a bias to optimism to sell products from advertisers and attract view/readership.
  • Optimism – Overly optimistic assumptions tend to lead to rather dramatic reversions when met with reality.

The biggest of these problems for individuals is the “herding effect” and “loss aversion.”

These two behaviors tend to function together compounding the issues of investor mistakes over time. As markets are rising, individuals are lead to believe that the current price trend will continue to last for an indefinite period. The longer the rising trend last, the more ingrained the belief becomes until the last of “holdouts” finally “buys in” as the financial markets evolve into a “euphoric state.”

As the markets decline, there is a slow realization that “this decline” is something more than a “buy the dip” opportunity. As losses mount, the anxiety of loss begins to mount until individuals seek to“avert further loss” by selling.

As shown in the chart below, this behavioral trend runs counter-intuitive to the “buy low/sell high”investment rule.

In the end, we are just human. Despite the best of our intentions, it is nearly impossible for an individual to be devoid of the emotional biases that inevitably lead to poor investment decision-making over time.

EFM- This has a lot of food for thought. Part of it is true of the emotional biases. On the other hand, the buy and hold scenario creates huge losses and a emotional frustration that there is 'no way the market is for them.' However it is possible to keep losses at roughly 12% in recessionary periods and get back in and reset to a better economy. This is my graph

There is no emotion involved.

This is the phases 3 and 4 of the Process identified above. It is now being shopped/marketed to see who would like to buy. 

Investor/Investing Risk of Loss: Identify, Manage and Limit Investment Risk of Loss on Mutual Funds and ETFs

3/2: Rutgers Guide to Financial Link

Worth Bookmarking

3/2"Forecasting Methods in Finance" Fee Download
CEPR Discussion Paper No. DP12692

ALLAN G. TIMMERMANN, University of California, San Diego (UCSD) - Department of Economics, Centre for Economic Policy Research (CEPR)

Our review highlights some of the key challenges in financial forecasting problems along with opportunities arising from the unique features of financiall data. We analyze the difficulty of establishing predictability in an environment with a low signal-to-noise ratio, persistent predictors, and instability in predictive relations arising from competitive pressures and investors' learning. We discuss approaches for forecasting the mean, variance, and probability distribution of asset returns. Finally, we cover how to evaluate financial forecasts while accounting for the possibility that numerous forecasting models may have been considered, leading to concerns of data mining.


3/2: Verry interesting

Investors seeking access to companies that stand to benefit from a potential uptick in American infrastructure activity may want to consider the Global X U.S. Infrastructure Development ETF (Ticker: PAVE). PAVE offers equity exposure across multiple phases of infrastructure development, including production of raw materials, heavy equipment, engineering, and construction.

3/2: China

“We in the U.S. foreign policy community have remained deeply invested in expectations about China . . . even as evidence against them has accumulated,

Trump’s approach to China, a weird mix of open pleading for help with North Korea, fawning praise for Xi and threatened punitive tariffs on Chinese goods, hardly seems calculated to lay the basis for a more sustainable policy. The United States needs a long, sober policy rethink.

China has been gaining leverage over the political and economic leaders of the United States, and has learned how to make them defer to its norms.

China continues to rise, the United States will face a choice: We can try to beat China at its own games — raw geopolitics and mercantilist economics — as Trump seems to prefer. Or we can play to our historic strengths, shoring up our domestic democratic and capitalist institutions, and re-investing in traditional alliances with democratic nations in the Asia-Pacific region.

If there’s one clear lesson from the past 50 years of U.S. policy toward China, it’s that nothing is inevitable in international politics, or irreversible. From now on, the United States must act accordingly.

Frozen fish

Real photo

3/2"Risk Everywhere: Modeling and Managing Volatility" Fee Download
CEPR Discussion Paper No. DP12687

TIM BOLLERSLEV, Duke University - Finance, Duke University - Department of Economics, National Bureau of Economic Research (NBER)
AQR Capital Management, LLC
AQR Capital Management, LLC
AQR Capital Management, LLC, Copenhagen Business School - Department of Finance, New York University (NYU), Centre for Economic Policy Research (CEPR)

Based on a unique high-frequency dataset for more than fifty commodities, currencies, equity indices, and fixed income instruments spanning more than two decades, we document strong similarities in realized volatilities patterns across assets and asset classes. Exploiting these similarities within and across asset classes in panel-based estimation of new realized volatility models results in superior out-of-sample risk forecasts, compared to forecasts from existing models and more conventional procedures that do not incorporate the information in the high-frequency intraday data and/or the similarities in the volatilities. A utility-based framework designed to evaluate the economic gains from risk modeling highlights the interplay between parsimony of model specification, transaction costs, and speed of trading in the practical implementation of the different risk models.

3/2: Most states do not require financial liteeracy classes

The 2017 Financial Report Card from Champlain College’s Center for Financial Literacy gave just five states — Alabama, Missouri, Tennessee, Utah and Virginia — an A grade for their efforts. The five require high school students to take at least a half-year personal finance course, or the equivalent, as a graduation requirement. The courses cover topics like using credit safely, saving for retirement, investing and navigating the financial decisions that typically occur in a person’s lifetime.

While there has been debate over whether mandating personal finance education is an effective way to make young people more savvy about money, the report cites studies suggesting that instruction is helpful if teachers receive “robust” training and use a well-designed curriculum.

 EFM- However I do remember this- the student instruction was almost useless unless they used it. Which the didn't right then so they just reverted to "if you don't use it, you'll lose it.' They lost it. The head of the program just  said it wasn't worth the effort


3/2: The gaping hole in global economic governance
Despite solid growth and buoyant equity markets, the annual gathering of policymakers and business people in Davos, Switzerland, was overshadowed by fear that clashes between the great trading powers could derail the expansion.

EFM- This was from FT in January. Right now, the U.S. is doing well but Europe is still doing quantitative easing. It's like their are two universes and too much stress means trouble.


"Betting Against Correlation: Testing Theories of the Low-Risk Effect" Fee Download
CEPR Discussion Paper No. DP12686

CLIFFORD S. ASNESS, AQR Capital Management, LLC
AQR Capital Management, LLC
Copenhagen Business School - Department of Finance, Students
AQR Capital Management, LLC, Copenhagen Business School - Department of Finance, New York University (NYU), Centre for Economic Policy Research (CEPR)

We test whether the low-risk effect is driven by (a) leverage constraints and thus risk should be measured using beta vs. (b) behavioral effects and thus risk should be measured by idiosyncratic risk. Beta depends on volatility and correlation, where only volatility is related to idiosyncratic risk. Hence, the new factor betting against correlation (BAC) is particularly suited to differentiating between leverage constraints vs. lottery explanations. BAC produces strong performance in the US and internationally, supporting leverage constraint theories. Similarly, we construct the new factor SMAX to isolate lottery demand, which also produces positive returns. Consistent with both leverage and lottery theories contributing to the low-risk effect, we find that BAC is related to margin debt while idiosyncratic risk factors are related to sentiment and casino profits.

3/2:"Deep Value" Fee Download
CEPR Discussion Paper No. DP12685

CLIFFORD S. ASNESS, AQR Capital Management, LLC
AQR Capital Management, LLC
AQR Capital Management, LLC, Copenhagen Business School - Department of Finance, New York University (NYU), Centre for Economic Policy Research (CEPR)
AQR Capital Management, LLC

We define "deep value" as episodes where the valuation spread between cheap and expensive securities is wide relative to its history. Examining deep value across global individual equities, equity index futures, currencies, and global bonds provides new evidence on competing theories for the value premium. Following these episodes, the value strategy has (1) high average returns; (2) low market betas, but high betas to a global value factor; (3) deteriorating fundamentals; (4) negative news sentiment; (5) selling pressure; (6) increased limits to arbitrage; and (7) increased arbitrage activity. Lastly, we find that deep value episodes tend to cluster and a deep value trading strategy generates excess returns not explained by traditional risk factors.


"The New Fama Puzzle" Fee Download
NBER Working Paper No. w24342

University of Wisconsin, Madison - Robert M. La Follette School of Public Affairs and Department of Economics, National Bureau of Economic Research (NBER)
Banque de France, Université Paris Ouest - Nanterre, La Défense - EconomiX
Paris School of Economics (PSE)

We re-examine the Fama (1984) puzzle – the finding that ex post depreciation and interest differentials are negatively correlated, contrary to what theory suggests – for eight advanced country exchange rates against the US dollar, over the period up to February 2016. The rejection of the joint hypothesis of uncovered interest parity (UIP) and rational expectations – sometimes called the unbiasedness hypothesis – still occurs, but with much less frequency. Strikingly, in contrast to earlier findings, the Fama regression coefficient is positive and large in the period after the global financial crisis. However, using survey based measures of exchange rate expectations, we find much greater evidence in favor of UIP. Hence, the main story for the switch in Fama coefficients in the wake of the global financial crisis is mostly a change in how expectations errors and interest differentials co-move, though the risk premium also plays a critical role for safe haven currencies (Japanese yen and Swiss franc).


3/1:Fed's Quarles sees US growth on verge of accelerating

Federal Reserve Governor Randal Quarles says US growth might be poised to accelerate faster than expected, which would necessitate a rise in interest rates to maintain stability

EFM- Thems fightin words. Higher rates are necessary but push too far and the economy will break. And if we break, so will the world

3/1:Boomers flock to robo-advisers

Millennials would seem to be the natural audience for robotic-driven investment advice, but a new report from T. Rowe Price shows baby boomers may be the fastest-growing demographic. Low fees and low maintenance are some of the draws of robo-advice that boomers cite.

EFM- they can't work that well since they cannot interpret real world risk.  So I don't know how they will fare under fiduciary magnifying glass.

3/1:Commentary: Telling clients not to panic may be a wrong move

While stock market corrections occur regularly, the latest one seems to have caused undue concern as it follows an unusually long period of stability, writes adviser Dan Moisand. He argues that advising clients not to panic may seem like a sound strategy but it could actually increase their unease, and adds: "A better approach is first to be crystal clear that no one truly knows if this will get worse but historically the unknowability of the future has not been a problem if a good plan is in place."

EFM- So what was the plan in 2000? Suck it up? And you shouldn't have bought so much tech??

What about 2008? If you stayed in the market your retirement, your kid's college, your health care and more took a bath. What can you do? Understand real world risk and reduce as necessary.

3/1: Global warming

North Pole surges above freezing in the dead of winter, stunning scientists

Arctic temperatures are warmer than ever recorded in February.

extreme warm intrusions in the Arctic, once rare, are becoming more routine, research has shown. A study published last July found that since 1980, these events are becoming more frequent, longer-lasting and more intense.

“Previously this was not common,” . “It happened in four years between 1980-2010, but has now occurred in four out of the last five winters.”

Scientists were shocked in recent days to discover open water north of Greenland, an area normally covered by old, very thick ice. “This has me more worried than the warm temps in the Arctic right now."

 weather station Cape Morris Jesup has logged a record-crushing 61 hours above freezing so far this calendar year. The previous record, dating to 1980, was 16 hours through the end of April in 2011.

EFM-  So how does that impact the world? We are screwed. With global warming occurring 10 times faster than anticipated, the icebergs will melt much faster and the rise of the oceans will be many times faster and will cover the small island countries within 10 years instead of 20; the new costs in the U.S. with the likes of New Orleans, New York, New Jersey, Florida etc. must be addressed NOW- but cannot be due to the huge budget deficit. The effort by the world to reduce harmful gasses will be considered moot since the nations were hoping to stave off this mess by 'slowly' ramping up rules. Too late. Our entire world will now be in a turmoil as most of the truly bad catastrophes will regularly continue within the lifetime of our children. I figured that the world would collapse perhaps by 50%  by 2050 and then into total chaos by 2100. Now I push the percentage of overall decimation at 65% to 70% by 2050.


3/4: Rehab 4 Alcoholism is a free and impartial helpline for people troubled with drug and alcohol issues.  Rehab 4 Alcoholism aims to save lives by stopping addiction before it becomes too late. Tel: 0800 111 4108 Web

3/1: Mechanisms Behind Retirement Saving Behavior: Evidence From Administrative and Survey Data
"People who tend to procrastinate are more likely to stay at the default contribution rate under automatic enrollment. Low financial understanding increases the likelihood of remaining at the effective 0% default contribution rate in an opt-in plan. Non-procrastinators on average save more than other employees and are more likely to maximize their employer match. Tools and advice designed to help participants make saving decisions may need to account for the plan's default participation status."


Value Added

Plan sponsors often fail to comprehend or value their advisers’ fiduciary services,). Asked if they think plan sponsors understand what it means to have their adviser serve as a fiduciary, 43% of attendees polled said, “No.” And, asked if they thought plan sponsors value their adviser serving as a fiduciary, 54% responded, “Yes, some do.Read more >


More Than Half of Americans Not Contributing to a 401(k) Furthermore, only 37% are contributing to an IRA, and 18% to a HSA, Edward Jones learned in a survey Read more >

Generally they are the poor- but not always. In any case, always contribute up to the amount that they employer offers. It is free money- but that is apparently not getting through in the investment classes

3/1/ I thought Ben Carson had his act together. Certainly nothing like other Trump selections. And now thisBen Carson’s HUD, Planning Cuts, Spends $31,000 on Dining Set for His Office

I simply cannot  fathom the idiocy of man when they get power.

2/28: Five Decades of Middle-Class Wages


2/28: Yes we have no bananas "History suggests that if the Fed waits too long to remove accommodation at this stage in the economic cycle, excesses and imbalances begin to build, and the Fed ultimately has to play catch-up." 

The most ironic warning, however, came when Kaplan predicted the US fiscal future beyond 2 years: he said that while the corporate tax cuts and other reforms may boost productivity and lift economic potential, most of the stimulative effects will fade in 2019 and 2020, leaving behind an economy with a higher debt burden than before.

"This projected increase in government debt to GDP comes at a point in the economic cycle when it would be preferable to be moderating the rate of debt growth at the government level," Kaplan said.

He was referring, indirectly, to the following chart from Goldman which we showed previously, and which suggests the US will become a banana republic in just a few years.


2/28: It's happening in Florida. We have 85 degree weather starting in mid February- about 10 degrees above normal. If it stays 10 degrees higher in summer- Oy Vey!!!!

Spring is running 20 days early. It’s exactly what we expect, but it’s not good.

Climate change is truncating winter and extending the growing season. That sounds great, especially given the dire warnings of food shortages. But a longer growing season is not always a good thing.

2/28:Well, this sucks


2/28: Simply too high as regards the market.