tag:blogger.com,1999:blog-24571505927335244402024-03-13T16:16:08.716-04:00Fi$callyFitIn good times or bad, financial security begins with sound money management.
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Click on "Comments" to share your thoughts with us.Angela Carterhttp://www.blogger.com/profile/12819817372215002169noreply@blogger.comBlogger181125tag:blogger.com,1999:blog-2457150592733524440.post-47566600342786172252011-07-28T20:30:00.001-04:002011-07-28T20:38:15.177-04:00Fear of the Unknown Driving the Stock Market<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAnV3ZkJU0Np7RMzWQQh8TNCFJJep4wQ1xd9jQfqt8gcKdCrFPwVoL7QH3WV1qAaOBYmtuOJmDzXR_vKod6HMdyE_6NzHJ9vvNgprxNOEMrg70qBekXX5NMpAB_eaVB6JfbLLwOAaNdJc/s1600-h/PaulSchatz.jpg"><img alt="" border="0" id="BLOGGER_PHOTO_ID_5385080613162580258" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAnV3ZkJU0Np7RMzWQQh8TNCFJJep4wQ1xd9jQfqt8gcKdCrFPwVoL7QH3WV1qAaOBYmtuOJmDzXR_vKod6HMdyE_6NzHJ9vvNgprxNOEMrg70qBekXX5NMpAB_eaVB6JfbLLwOAaNdJc/s320/PaulSchatz.jpg" style="float: left; height: 320px; margin: 0px 10px 10px 0px; width: 258px;" /></a><em></em><br />
<em>(Editor's Note: Paul Schatz, President of Heritage Capital, LLC, in Woodbridge, will be contributing to Fi$callyFit every Friday. </em><a href="http://www.investfortomorrow.com/CallinShots.asp"><em>Read his biography here</em></a><em>)</em><br />
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The other day, Wed., July 27, was the first real day where I saw some very heavy and indiscriminate selling in the markets. More than 10 stocks were down for every one that advanced. The same mass exodus was seen in the volume of stocks going down versus up.<br />
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Every single U.S. sector I follow closed in the red. All countries outside the U.S. with the exception of Mexico closed lower. People were heading for the exits. <br />
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But action like this has been seen over and over and over. So far, there has been nothing atypical about the three day decline in stocks.<br />
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And given the selloff, more red is certainly possible over the coming days or so. Since mid June, the Dow has risen from 11,900 to 12,800 and back to 12,300. <br />
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It would not be shocking, worst case, for stocks to revisit 11,900 again before regaining their footing and heading to new highs. That forecast remains unchanged. I remain of the belief that the stock market will resolve itself for at least one more run to new highs that will be based on what is becoming a record corporate earnings quarter with the exception of Bank of America. As such, until proven otherwise, I believe pullbacks are buying opportunities.<br />
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This whole deadline reminds me of how the media played up the first Persian Gulf War when Iraq invaded Kuwait in the summer of 1990. And if we didn't learn from that, the same thing happened in 2003 when we invaded Iraq. Markets typically sell the rumor and by the news.<br />
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I recall recuperating from surgery on my parents' couch in January 1991. At that time, just three years in the business, my plan was to buy after war broke out and the market collapsed. But as the first missiles began to fly on January 17 (?), 1991, stocks around the globe surged and launched a new bull market. While I do not believe the exact same scenario will play out here, I think most rational people believe that the looming "crisis" will be resolved sooner than later and the markets will shift their attention back to Europe and Q2 earnings. <br />
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Frustration, anger and name calling aside, I still think that those idiots in government (sorry, I couldn't help myself) will find a way to compromise and meet somewhere in the middle before any real carnage is done.<br />
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Regarding our investment strategies, and you are always welcome to disagree, our models do not take into account geopolitical news of the moment. I believe that is a losers game and I don't know anyone who successfully manages money based on today's headlines. Our models are not infallible, but I think they have done a pretty good job over the years. I continue to rely on them to navigate us through the stormy seas we occasionally hit. Keep in mind that the S&P 500 currently sits just 4.5% off its multi-year hit! Yes, I know, that's for now. <br />
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Feel free to email me with any questions or comments at Paul@investfortomorrow.com.<br />
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Until next time…<br />
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Paul Schatz<br />
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Heritage Capital LLC<br />
<a href="http://www.investfortomorrow.com/">http://www.investfortomorrow.com/</a><br />
<a href="http://retirementplanningconnecticut.com/">http://RetirementPlanningConnecticut.com/</a><br />
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Follow us on Facebook at www.facebook.com/heritagecapital and on Twitter @Paul_SchatzAngela Carterhttp://www.blogger.com/profile/12819817372215002169noreply@blogger.com0tag:blogger.com,1999:blog-2457150592733524440.post-12883319404691311632011-07-22T09:28:00.001-04:002011-07-28T20:31:32.676-04:00Still Riding the Bullish Wave<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAnV3ZkJU0Np7RMzWQQh8TNCFJJep4wQ1xd9jQfqt8gcKdCrFPwVoL7QH3WV1qAaOBYmtuOJmDzXR_vKod6HMdyE_6NzHJ9vvNgprxNOEMrg70qBekXX5NMpAB_eaVB6JfbLLwOAaNdJc/s1600-h/PaulSchatz.jpg"><img alt="" border="0" id="BLOGGER_PHOTO_ID_5385080613162580258" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAnV3ZkJU0Np7RMzWQQh8TNCFJJep4wQ1xd9jQfqt8gcKdCrFPwVoL7QH3WV1qAaOBYmtuOJmDzXR_vKod6HMdyE_6NzHJ9vvNgprxNOEMrg70qBekXX5NMpAB_eaVB6JfbLLwOAaNdJc/s320/PaulSchatz.jpg" style="float: left; height: 320px; margin: 0px 10px 10px 0px; width: 258px;" /></a><em></em><br />
<em>(Editor's Note: Paul Schatz, President of Heritage Capital, LLC, in Woodbridge, will be contributing to Fi$callyFit every Friday. </em><a href="http://www.investfortomorrow.com/CallinShots.asp"><em>Read his biography here</em></a><em>)</em><br />
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<span style="color: #000099; font-family: "Verdana", "sans-serif";"><span style="color: black;">I am going to spend my time this week staying with the theme from the past few weeks, my bullish forecast for the stock market.<span style="mso-spacerun: yes;"> </span></span></span><br />
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<span style="color: #000099; font-family: "Verdana", "sans-serif";"><span style="color: black;">Although this phrase always applies, it’s certainly been an interesting few weeks, especially on the geopolitical front with the debt crisis deadline looming, Greece, Ireland, Spain and Italy along with the plethora of poor economic reports.<span style="mso-spacerun: yes;"> </span></span></span><br />
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<span style="color: #000099; font-family: "Verdana", "sans-serif";"><span style="color: black;">Yet with all this being shoved down our throats 24/7 by the media, the major stock market indices are one or two strong days away from multi year highs.<span style="mso-spacerun: yes;"> </span>It’s been the epitome of resilient.</span></span><br />
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<div style="text-align: left;"><span style="color: black;"></span><span style="color: #000099; font-family: "Verdana", "sans-serif";"><span style="color: black;">For the past month, I have leaned heavily on the bullish side of the argument for stocks.<span style="mso-spacerun: yes;"> </span>I won’t bore you with the facts, evidence and opinion, but my forecast flew in the face of conventional and generally accepted, just the place I am comfortable trafficking, in the minority.<span style="mso-spacerun: yes;"> </span></span></span><br />
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<span style="color: #000099; font-family: "Verdana", "sans-serif";"><span style="color: black;">But to be fair, if I was going to be wrong, I laid the case out last week from a technical perspective.</span></span></div><div style="text-align: left;"></div><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgLnD7F8E9kxi9G2bivIwAY3UbGDkboANYKyYfoqWJh64vVvW6kONQNDUxHolvFMzWUbhTx_kSgsxmr14dxsosXbPdU620pKbhbMAvRzCnCCbx_aPax3n6_5X23A8TJUB2NDtK8k4XwBG8/s1600/hs721.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="277" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgLnD7F8E9kxi9G2bivIwAY3UbGDkboANYKyYfoqWJh64vVvW6kONQNDUxHolvFMzWUbhTx_kSgsxmr14dxsosXbPdU620pKbhbMAvRzCnCCbx_aPax3n6_5X23A8TJUB2NDtK8k4XwBG8/s400/hs721.jpg" width="400" /></a></div><div style="text-align: left;"><br />
<span style="color: black; font-family: "Verdana", "sans-serif"; mso-themecolor: text1;">The chart above from last week has been updated and remains an open possible scenario for the bears if the S&P 500 is able to close a few days below the neckline.<span style="mso-spacerun: yes;"> </span>Given the strength this week, it would be a long drop just to get to the line in the sand, let along pierce it.<span style="mso-spacerun: yes;"> </span>If and when the S&P 500 closes above the area labeled “right shoulder”, the head and shoulder pattern for the bears will be null and void, something I continue to believe will occur this quarter.</span></div><div style="text-align: left;"><span style="color: black; font-family: Times New Roman;"> </span></div><div style="margin: 0in 0in 0pt;"><span style="color: black; font-family: "Verdana", "sans-serif"; mso-themecolor: text1;">The other negative technical chart pattern can be seen below, the island top.<span style="mso-spacerun: yes;"> </span>And like the head and shoulders chart, the island top is very close to breaching its own line in the sand, which would nullify the potential negativity of the pattern.</span></div><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhpyNijhreTVEC_Ukvp07CJtrw-AAO2vX8vFdvOG8V-VLgUGND8l_mqF8YMy2Os0VVHmSkmCzNHPHguvXjHfjYDei6AVWhCJxlegD2J0vQ9tsKkfkRJisPED4iTEl_CFUBL_laY4tTFMIM/s1600/islandtop721.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><span style="color: black;"><img border="0" height="277" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhpyNijhreTVEC_Ukvp07CJtrw-AAO2vX8vFdvOG8V-VLgUGND8l_mqF8YMy2Os0VVHmSkmCzNHPHguvXjHfjYDei6AVWhCJxlegD2J0vQ9tsKkfkRJisPED4iTEl_CFUBL_laY4tTFMIM/s400/islandtop721.jpg" width="400" /></span></a></div><div style="text-align: left;"><span style="color: black; font-family: Times New Roman;"> </span></div><div style="margin: 0in 0in 0pt;"><span style="color: black; font-family: "Verdana", "sans-serif"; mso-themecolor: text1;">As I have already mentioned over the past few weeks, the Russell 2000 (small caps), S&P 400 (mid caps), high yield bonds and the Dow Jones Transports scored all time highs at the April market peak along with the Advance/Decline line, a cumulative measure of the number of stocks going up and down each day.</span><br />
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<span style="color: black; font-family: "Verdana", "sans-serif"; mso-themecolor: text1;">On the fundamental front, something I am certainly no expert in, S&P 500 earnings are growing faster than the S&P 500 index. That means the market is getting cheaper even though it is still rising. We are actually seeing price/earnings multiple compression rather than the usual expansion. It is highly unusual for a bear market to begin with so many positives at a market peak. </span></div><div style="text-align: left;"><span style="color: black; font-family: Times New Roman;"></span></div><div style="margin: 0in 0in 0pt;"><span style="color: black; font-family: "Verdana", "sans-serif"; mso-themecolor: text1;">Taking a longer-term perspective, something I am not usually known for doing, the NASDAQ 100 continues to give off some very positive vibes.<span style="mso-spacerun: yes;"> </span>This index is made up of the 100 largest non-financial stocks on the NASDAQ and is dominated by tech giants Apple, Intel, Google, Microsoft , Oracle and Cisco.<span style="mso-spacerun: yes;"> </span>As you can see below, the index is quietly and without fanfare bumping up against fresh 10 year highs!<span style="mso-spacerun: yes;"> </span></span></div><div style="text-align: left;"><span style="color: black; font-family: Times New Roman;"> </span></div><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh0tmrGjmXCpyuUCNiLNog00WemT0_UVXUM7PVSLnsD8QqKAtnA4LwZRh3Jz3-1_rR_Gq4V5pbt__VY__bvQCXyLHgc0L9opfQAK8O-y_QVHoB4a-8aQpdt63_XZvtmFr47wAdC54TRvxI/s1600/10yrhigh.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="277" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh0tmrGjmXCpyuUCNiLNog00WemT0_UVXUM7PVSLnsD8QqKAtnA4LwZRh3Jz3-1_rR_Gq4V5pbt__VY__bvQCXyLHgc0L9opfQAK8O-y_QVHoB4a-8aQpdt63_XZvtmFr47wAdC54TRvxI/s400/10yrhigh.jpg" width="400" /></a></div><div style="text-align: left;"><br />
<span style="color: black; font-family: "Verdana", "sans-serif"; font-size: 11pt; line-height: 115%; mso-ansi-language: EN-US; mso-bidi-font-family: "Times New Roman"; mso-bidi-language: AR-SA; mso-fareast-font-family: Calibri; mso-fareast-language: EN-US; mso-themecolor: text1;">Looking out even further gives you a sense of how much upside room there is before all-time highs can be seen.<span style="mso-spacerun: yes;"> </span>In case you forgot, the Dotcom bubble high from 2000 is another 100% from here.<span style="mso-spacerun: yes;"> </span>I remember quipping on Bloomberg TV that whatever high the NASDAQ was putting in wouldn’t be seen again in my lifetime.<span style="mso-spacerun: yes;"> </span>I certainly hope I live a very long life and will be able to see that peak eclipsed sometime in the 2020s or 2030s.</span></div><div style="text-align: left;"></div><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgiso7DK9yfVIJNgB8u9sBX033HjuDwh9owt4RnNp2ml-GntHc0eA4FDgahIinViiW_vIiPVuyUXmtQAne9jxR6WXV72KoTnt2eawFYDr-bADZEQmmv1Zh0tC2RuGsxrv3RYOrGXzy9PyE/s1600/highmonthly.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="277" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgiso7DK9yfVIJNgB8u9sBX033HjuDwh9owt4RnNp2ml-GntHc0eA4FDgahIinViiW_vIiPVuyUXmtQAne9jxR6WXV72KoTnt2eawFYDr-bADZEQmmv1Zh0tC2RuGsxrv3RYOrGXzy9PyE/s400/highmonthly.jpg" width="400" /></a></div><div style="text-align: left;"><br />
<span style="color: black; font-family: "Verdana", "sans-serif"; mso-themecolor: text1;">Last week I closed with:</span></div><div style="text-align: left;"></div><div style="margin: 0in 0in 0pt;"><i style="mso-bidi-font-style: normal;"><span style="color: black; font-family: "Verdana", "sans-serif"; mso-themecolor: text1;">'Given all the positives listed earlier against the negatives from the charts, the easiest thing to do would be to move to a neutral stance. And maybe that means we are in for some sideways activity. "Play it safe", if you will, with all the negative news from the debt ceiling debacle to Italy and Ireland and Greece. But I have never been to one to seek the easy way out. I continue to believe that the major stock market indices are going to resolve themselves to the upside and score new high closes this quarter. And that's the way I plan to invest until proven otherwise.' </span></i></div><div style="text-align: left;"></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: black; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial; mso-themecolor: text1;">And I still feel the same way now. The stock market has had a nice run this week and while it certainly deserves a rest, I think any pullback is a buying opportunity until proven otherwise.<span style="mso-spacerun: yes;"> </span>The first thing that would concern me is if the major indices closed below the low we saw on Monday morning July 18.</span></div><div style="text-align: left;"></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: black; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial; mso-themecolor: text1;">I hope you stay cool in all this heat.<span style="mso-spacerun: yes;"> </span>Relief is on the way!</span></div><div style="text-align: left;"></div><div style="text-align: left;"></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: black; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial; mso-themecolor: text1;">Feel free to email me with any questions or comments at <a href="mailto:Paul@investfortomorrow.com"><span style="color: black; mso-themecolor: text1;">Paul@investfortomorrow.com</span></a>.</span></div><div style="text-align: left;"></div><div style="text-align: left;"></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: black; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial; mso-themecolor: text1;">Until next time…</span></div><div style="text-align: left;"></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: black; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial; mso-themecolor: text1;">Paul Schatz</span></div><div style="text-align: left;"></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: black; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial; mso-themecolor: text1;">Heritage Capital LLC</span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: black; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial; mso-themecolor: text1;"><a href="http://www.investfortomorrow.com/"><span style="color: black; mso-themecolor: text1;">http://www.InvestForTomorrow.com</span></a></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: black; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial; mso-themecolor: text1;"><a href="http://retirementplanningconnecticut.com/"><span style="color: black; mso-themecolor: text1;">http://RetirementPlanningConnecticut.com/</span></a></span></div><div style="text-align: left;"></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: black; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial; mso-themecolor: text1;">Follow us on Facebook at <a href="http://www.facebook.com/heritagecapital"><span style="color: black; mso-themecolor: text1;">www.facebook.com/heritagecapital</span></a> and on Twitter @Paul_Schatz</span></div>Angela Carterhttp://www.blogger.com/profile/12819817372215002169noreply@blogger.com0tag:blogger.com,1999:blog-2457150592733524440.post-69864551971434088112011-07-15T15:00:00.001-04:002011-07-22T09:17:34.165-04:00Regulators expand disclosure requierments when credit is denied or revokedThe Board of Governors of the Federal Reserve System is expanding the mandates of the Equal Credit Opportunity Act, which requires a creditor to notify an applicant when an extension of credit is denied, based in whole or in part on information in a consumer report.<br />
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Under the Dodd-Frank Wall Street Reform and Consumer Protection Act, consumers who are denied credit or whose existing credit arrangement becomes less favorable - or even worse - gets revoked, based on a credit score will be able to get free access to that score and other related information.<br />
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The creditor will have to provide a statement giving the reasons for taking an adverse action against the consumer and also a notice that discloses the applicant's right to a statement of reasons, right to a free credit report and right to dispute the accuracy or completeness of information in the consumer report used by the creditor to make a lending decision.<br />
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Under the Fair Credit Reporting Act, consumers also are entitled to know the numerical credit score used in making the credit decision; the range of possible scores under the model used to generate the score; up to four key factors that adversely affected the consumer's credit score; the date on which the score was generated; and the name of the person or entity that provided the score.<br />
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The changes take effect July 21.<br />
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The Equal Credit Opportunity Act makes it unlawful for creditors to discriminate on the basis of sex, race, color, religion, national origin, marital status, age or because all or part of an applicant's income derives from public assistance.Angela Carterhttp://www.blogger.com/profile/12819817372215002169noreply@blogger.com0tag:blogger.com,1999:blog-2457150592733524440.post-9771724656036288722011-07-15T11:58:00.002-04:002011-07-22T09:18:27.696-04:00Up? Down? Sideways?<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAnV3ZkJU0Np7RMzWQQh8TNCFJJep4wQ1xd9jQfqt8gcKdCrFPwVoL7QH3WV1qAaOBYmtuOJmDzXR_vKod6HMdyE_6NzHJ9vvNgprxNOEMrg70qBekXX5NMpAB_eaVB6JfbLLwOAaNdJc/s1600-h/PaulSchatz.jpg"><img alt="" border="0" id="BLOGGER_PHOTO_ID_5385080613162580258" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAnV3ZkJU0Np7RMzWQQh8TNCFJJep4wQ1xd9jQfqt8gcKdCrFPwVoL7QH3WV1qAaOBYmtuOJmDzXR_vKod6HMdyE_6NzHJ9vvNgprxNOEMrg70qBekXX5NMpAB_eaVB6JfbLLwOAaNdJc/s320/PaulSchatz.jpg" style="float: left; height: 320px; margin: 0px 10px 10px 0px; width: 258px;" /></a><em>(Editor's Note: Paul Schatz, President of Heritage Capital, LLC, in Woodbridge, will be contributing to Fi$callyFit every Friday. </em><a href="http://www.investfortomorrow.com/CallinShots.asp"><em>Read his biography here</em></a><em>)</em><br />
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In the past two <a href="http://www.investfortomorrow.com/news.asp">Street$marts</a> as well as on this blog, I have pounded the table that the odds heavily favored a market rally. I thought that we were just seeing the fourth 4-8% pullback since the major low on July 1, 2010 and the bulls were about to pounce. When so many people emailed, called and interviewed with the opposite forecast, I felt even stronger that higher prices were in order. And the market did not disappoint!<br />
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Longer-term, the Russell 2000 (small caps), S&P 400 (mid caps), high yield bonds and the Dow Jones Transports scored all-time highs at the April market peak along with the Advance/Decline line, a cumulative measure of the number of stocks going up and down each day. On the fundamental front, something I am certainly no expert in, S&P 500 earnings are growing faster than the S&P 500 index. That means the market is getting cheaper even though it is still rising. We are actually seeing price/earnings multiple compression rather than the usual expansion. It is highly unusual for a bear market to begin with so many positives at a market peak. In April 2010, we saw the same thing, but had to endure a 17% correction before more new highs were seen. <br />
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One possible scenario that worried me during the rally was that the market was going to make it difficult and stop short of new highs and begin to rollover. People who trade and invest by using charts would call that formation a Head and Shoulders Top. Only when the index breached the blue neckline and closed below it, would the pattern be confirmed and much lower prices would ensue.<br />
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<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgitM18gaxhBH9Eg28GfT_D2Ms0Yqm7LVCOfzHLMDqY5ePQapEMELNFthKePvK6jQO80BcHnI7psG76JvCj2By_BRXfisuYWswXRZxFnWguM3bYIJPY5MXwofAgR-4MqJknJUcxkJmjrPs/s1600/hs71511.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="277" m$="true" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgitM18gaxhBH9Eg28GfT_D2Ms0Yqm7LVCOfzHLMDqY5ePQapEMELNFthKePvK6jQO80BcHnI7psG76JvCj2By_BRXfisuYWswXRZxFnWguM3bYIJPY5MXwofAgR-4MqJknJUcxkJmjrPs/s400/hs71511.jpg" width="400" /></a></div><div class="separator" style="clear: both; text-align: center;"><br />
</div><div class="separator" style="clear: both; text-align: left;"><span style="color: black; font-family: Verdana;"><span style="font-family: Times, "Times New Roman", serif;">Additionally, as you can see below, chartists are also screaming about another negative pattern called an Island Top where there is a "lonely" day of trading isolated above the day before and after.</span></span></div><div align="justify" class="separator" style="clear: both; text-align: center;"><br />
</div><div align="justify" class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiDwk9GMheqNEjnOcF_x_uoncK07x0_iy7q849ghsfdgyWEP3fiXWp8fyIuvRe8a9zIDQajIF0dtYKxUx1EMW2ls0oeZncq3wDHPYkkqDDFUZExh6LIWmANymRrhX202sKtDkMe0wrzE-o/s1600/islandtop.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="277" m$="true" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiDwk9GMheqNEjnOcF_x_uoncK07x0_iy7q849ghsfdgyWEP3fiXWp8fyIuvRe8a9zIDQajIF0dtYKxUx1EMW2ls0oeZncq3wDHPYkkqDDFUZExh6LIWmANymRrhX202sKtDkMe0wrzE-o/s400/islandtop.jpg" width="400" /></a></div><div class="separator" style="clear: both; text-align: center;"><br />
</div><div class="separator" style="clear: both; text-align: left;">Given all the positives listed earlier against the negatives from the charts, the easiest thing to do would be to move to a neutral stance. And maybe that means we are in for some sideways activity. "Play it safe", if you will, with all the negative news from the debt ceiling debacle to Italy and Ireland and Greece. But I have never been to one to seek the easy way out. I continue to believe that the major stock market indices are going to resolve themselves to the upside and score new high closes this quarter. And that's the way I plan to invest until proven otherwise. </div><div style="text-align: left;"></div><div style="text-align: left;"><br />
</div>Feel free to email me with any questions or comments at Paul@investfortomorrow.com.<br />
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Until next time…<br />
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<br />
Paul Schatz<br />
<br />
Heritage Capital LLC<br />
<br />
<a href="http://www.investfortomorrow.com/">http://www.investfortomorrow.com/</a><br />
<a href="http://retirementplanningconnecticut.com/">http://RetirementPlanningConnecticut.com/</a><br />
<div style="text-align: justify;">Follow us on Facebook at www.facebook.com/heritagecapital and on Twitter @Paul_Schatz</div>Angela Carterhttp://www.blogger.com/profile/12819817372215002169noreply@blogger.com0tag:blogger.com,1999:blog-2457150592733524440.post-77748544523955779392011-07-08T07:48:00.001-04:002011-07-15T14:10:48.575-04:00No "Buts" Here...That Was Some Rally<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAnV3ZkJU0Np7RMzWQQh8TNCFJJep4wQ1xd9jQfqt8gcKdCrFPwVoL7QH3WV1qAaOBYmtuOJmDzXR_vKod6HMdyE_6NzHJ9vvNgprxNOEMrg70qBekXX5NMpAB_eaVB6JfbLLwOAaNdJc/s1600-h/PaulSchatz.jpg"><img alt="" border="0" id="BLOGGER_PHOTO_ID_5385080613162580258" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAnV3ZkJU0Np7RMzWQQh8TNCFJJep4wQ1xd9jQfqt8gcKdCrFPwVoL7QH3WV1qAaOBYmtuOJmDzXR_vKod6HMdyE_6NzHJ9vvNgprxNOEMrg70qBekXX5NMpAB_eaVB6JfbLLwOAaNdJc/s320/PaulSchatz.jpg" style="float: left; height: 320px; margin: 0px 10px 10px 0px; width: 258px;" /></a><em>(Editor's Note: Paul Schatz, President of Heritage Capital, LLC, in Woodbridge, will be contributing to Fi$callyFit every Friday. </em><a href="http://www.investfortomorrow.com/CallinShots.asp"><em>Read his biography here</em></a><em>)</em><br />
<br />
<div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: black; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-fareast-font-family: "Times New Roman"; mso-themecolor: text1;">The second quarter of 2011 was characterized by weakening economic data and the reemergence of the sovereign debt problems in Europe, especially Greece.</span><br />
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<span style="color: black; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-fareast-font-family: "Times New Roman"; mso-themecolor: text1;">For much of June in my weekly <a href="http://www.investfortomorrow.com/news.asp">Street$marts</a> newsletter and last week on this blog, I wrote about how bad the headlines have been with Greece, Europe, awful employment numbers, Case-Shiller home price index at fresh 9 year lows and the Fed's Quantitative Easing II was coming to an end on June 30.<span style="mso-spacerun: yes;"> </span>It certainly felt like the stock market should be down 10-15%, if not more.<span style="mso-spacerun: yes;"> </span>Yet when you look at the chart below, the market completed its fourth 4-8% normal and healthy pullback since the major low on July 1, 2010.</span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjztAYDYEeIG_Za2FJ8-HzX_PB6tJ9JXFcoEYisg7Tz9egegMMb72wq-39u1jAwDvDgmZ9416e68hqJvviVrMSW2Lal6rp1W7qOx7I05s2L_OztMjzRdIdZiBzmA23VuwgrkeS_9mbnGBQ/s1600/SP771.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="444" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjztAYDYEeIG_Za2FJ8-HzX_PB6tJ9JXFcoEYisg7Tz9egegMMb72wq-39u1jAwDvDgmZ9416e68hqJvviVrMSW2Lal6rp1W7qOx7I05s2L_OztMjzRdIdZiBzmA23VuwgrkeS_9mbnGBQ/s640/SP771.jpg" width="640" /></a></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><br />
<span style="color: black; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-fareast-font-family: "Times New Roman"; mso-themecolor: text1;"><span style="color: black; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-fareast-font-family: "Times New Roman"; mso-themecolor: text1;">You can also see from the chart that the S&P 500 touched the dark blue line, which represents the average price of the last 200 days.<span style="mso-spacerun: yes;"> </span>It is not uncommon for the market to visit this long-term trend gauge during periods of weakness.<span style="mso-spacerun: yes;"> </span>Interestingly, the 1250 area in pink on the chart was not breached during the decline.<span style="mso-spacerun: yes;"> </span>That's one thing that did surprise me.<span style="mso-spacerun: yes;"> </span>Typically, when the masses become so focused on a certain level, the market has a funny way of running through that number for a day or two, causing investors to take action and then reversing in the opposite direction leaving many people holding the bag.<span style="mso-spacerun: yes;"> </span>This is called a trap.</span></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="font-family: Times New Roman;"> </span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: black; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-fareast-font-family: "Times New Roman"; mso-themecolor: text1;">As I wrote about last month, the impending (and current) rally would be fueled by sentiment shifting from exuberant to despondent after only an 8% decline.<span style="mso-spacerun: yes;"> </span>Newsletter writers, often wrong at turning points, had become almost uniform in calling for a market correction after we had already seen a 6% pullback.<span style="mso-spacerun: yes;"> </span>Option players, especially smaller ones (usually mom and pop) were positioning for a correction, seeking the protection of put options after stocks were down 6%.<span style="mso-spacerun: yes;"> </span>That group is usually wrong when there is a strong consensus.<span style="mso-spacerun: yes;"> </span></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="font-family: Times New Roman;"> </span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: black; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-fareast-font-family: "Times New Roman"; mso-themecolor: text1;">Technical measures, like the advance/decline line, up/down volume and their derivatives had become as oversold as at any point since the bull market began.<span style="mso-spacerun: yes;"> </span>Intra-day gauges we created and use in-house were showing some mass selling right near the bottom.</span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="font-family: Times New Roman;"> </span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: black; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-fareast-font-family: "Times New Roman"; mso-themecolor: text1;">On the flip side, buying by corporate insiders began to pick up after only a 5% decline.<span style="mso-spacerun: yes;"> </span>This group may be wrong in the short-term, but they usually get it right the longer out you look.<span style="mso-spacerun: yes;"> </span>At the April stock market high, we saw junk bonds, the advance/decline line, Dow Transports, Russell 2000 and S&P 400 all score all-time highs with the Dow, S&P 500 and NASDAQ at multi year highs.<span style="mso-spacerun: yes;"> </span>Although that doesn't insulate the markets from a decline or correction, historically, bear markets do not begin with so many positives at a peak.</span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><br />
<span style="color: black; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-fareast-font-family: "Times New Roman"; mso-themecolor: text1;">So as I write this, we have now seen 8 straight days and 11 out of the last 13 where the bulls won the battle.<span style="mso-spacerun: yes;"> </span>That is unusually powerful momentum.<span style="mso-spacerun: yes;"> </span>During bull markets after a decline, that is confirmation of new leg higher beginning.<span style="mso-spacerun: yes;"> </span>During bear markets, a move like we have seen is best sold in to.<span style="mso-spacerun: yes;"> </span>Contrary to the emails I have received and arguments from my peers, we are still in a bull market folks.<span style="mso-spacerun: yes;"> </span>And with the Dow Transports scoring an all-time high today, we have further confirmation.</span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="font-family: Times New Roman;"></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: black; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-fareast-font-family: "Times New Roman"; mso-themecolor: text1;">From here, we need to keep an eye on which sectors are leading and make sure all of the major indices also make new highs, including high yield (junk) bonds. Friday at 8:30 a.m. is the release of the monthly employment report.<span style="mso-spacerun: yes;"> </span>With stocks coming so far, so fast, I would expect a strong opening to be viewed as a good very short-term selling opportunity for the market to gather itself, a pause to refresh if you will.</span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="font-family: Times New Roman;"> </span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: black; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-fareast-font-family: "Times New Roman"; mso-themecolor: text1;">FYI, I will be on CNBC’s Worldwide Exchange on July 13 at 5:35am. </span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="font-family: Times New Roman;"> </span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="font-family: Times New Roman;"></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: black; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial; mso-themecolor: text1;">Feel free to email me with any questions or comments at <a href="mailto:Paul@investfortomorrow.com"><span style="color: black; mso-themecolor: text1;">Paul@investfortomorrow.com</span></a>.</span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="font-family: Times New Roman;"> </span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="font-family: Times New Roman;"></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: black; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial; mso-themecolor: text1;">Until next time…</span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="font-family: Times New Roman;"> </span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="font-family: Times New Roman;"></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: black; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial; mso-themecolor: text1;">Paul Schatz</span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="font-family: Times New Roman;"></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: black; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial; mso-themecolor: text1;">Heritage Capital LLC</span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: black; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial; mso-themecolor: text1;"><a href="http://www.investfortomorrow.com/"><span style="color: black; mso-themecolor: text1;">http://www.InvestForTomorrow.com</span></a></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: black; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial; mso-themecolor: text1;"><a href="http://retirementplanningconnecticut.com/"><span style="color: black; mso-themecolor: text1;">http://RetirementPlanningConnecticut.com/</span></a></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="font-family: Times New Roman;"></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: black; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial; mso-themecolor: text1;">Follow us on Facebook at <a href="http://www.facebook.com/heritagecapital"><span style="color: black; mso-themecolor: text1;">www.facebook.com/heritagecapital</span></a> and on Twitter @Paul_Schatz</span></div>Angela Carterhttp://www.blogger.com/profile/12819817372215002169noreply@blogger.com0tag:blogger.com,1999:blog-2457150592733524440.post-47835655316252774882011-07-01T13:15:00.000-04:002011-07-01T13:15:07.016-04:00People's United completes acquisition of Danvers BancorpPeople’s United Financial, Inc. announced today the completion of its acquisition of Danvers Bancorp, Inc, a $2.9 billion bank holding company based in Danvers, Massachusetts.<br />
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Danvers Bancorp’s sole subsidiary, Danversbank, has 28 branches in the Greater Boston area. The total consideration paid by People’s United will be comprised of approximately 18.5 million shares of common stock and $214.5 million in cash.<br />
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“We are pleased to welcome our new customers and employees to People’s United Bank as we expand and deepen relationships in the greater Boston market, the nation’s 10th largest MSA,” said Jack Barnes, president and chief executive officer of People’s United. “As the largest bank headquartered in New England, we look forward to offering increased lending resources and additional products and services to our new customers in New England’s largest market."<br />
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People's United reports approximately $28 billion in assets, provides consumer and commercial banking and wealth management services through a network of 370 branches in Connecticut, Vermont, New Hampshire, Massachusetts, Maine and New York.Angela Carterhttp://www.blogger.com/profile/12819817372215002169noreply@blogger.com0tag:blogger.com,1999:blog-2457150592733524440.post-23612858016323650762011-07-01T11:57:00.003-04:002011-07-07T22:54:40.232-04:00The Rally is Here, but...<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAnV3ZkJU0Np7RMzWQQh8TNCFJJep4wQ1xd9jQfqt8gcKdCrFPwVoL7QH3WV1qAaOBYmtuOJmDzXR_vKod6HMdyE_6NzHJ9vvNgprxNOEMrg70qBekXX5NMpAB_eaVB6JfbLLwOAaNdJc/s1600-h/PaulSchatz.jpg"><img alt="" border="0" id="BLOGGER_PHOTO_ID_5385080613162580258" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAnV3ZkJU0Np7RMzWQQh8TNCFJJep4wQ1xd9jQfqt8gcKdCrFPwVoL7QH3WV1qAaOBYmtuOJmDzXR_vKod6HMdyE_6NzHJ9vvNgprxNOEMrg70qBekXX5NMpAB_eaVB6JfbLLwOAaNdJc/s320/PaulSchatz.jpg" style="float: left; height: 320px; margin: 0px 10px 10px 0px; width: 258px;" /></a><br />
<em>(Editor's Note: Paul Schatz, President of Heritage Capital, LLC, in Woodbridge, will be contributing to Fi$callyFit every Friday. </em><a href="http://www.investfortomorrow.com/CallinShots.asp"><em>Read his biography here</em></a><em>)</em><br />
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<br />
The Rally Is Here, But…<br />
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Last week, I spend some time with the folks at Yahoo! in New York taping two segments for their Yahoo! Finance show Breakout. What a great time! The first segment pretty much spells out my view of the stock market: <a href="http://finance.yahoo.com/blogs/breakout/bull-market-bust-134922757.html">Bull Market or Bust</a>.<br />
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If that segment wasn't controversial enough, the second segment, <a href="http://finance.yahoo.com/blogs/breakout/u-must-choose-austerity-irrelevance-fund-manager-155215227.html">Bye Bye Euro</a>, is about my long-term view that the Euro currency will cease to exist in the next 10 to 20 years. As I have mentioned before, it's all about the "haves and the have nots". While North Carolina may want to help save South Dakota, it's very difficult for the country of Germany to want to bailout Ireland or Spain or Portugal. And the countries in need want help on their terms, not austerity rammed down their throats. <br />
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The stock market certainly has done its best to confound the masses, as it usually does. The decline from the April peak pushed the envelope of what I call the normal, routine and healthy 4-8% pullback, but so far, that's exactly what it has been, 8% from high to low. I certainly did not think it would get to 8% and perhaps I have been a bit too complacent about it. But as I have done my whole career, I follow our models and the evidence at hand. <br />
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<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhNqWRxIocWerSRJZAByuTBHDbxXX7Fw6bw-nQW6MqSWVuaov91myNJ67MagLt2OIT31aDX-yxANOWMA75QrIlAZDuXa28atgdRF2jkGupETrUxK0UHdP3I60JQ3FbaNOsgC5ZEsCCr6RE/s1600/48pullback2.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="277" i$="true" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhNqWRxIocWerSRJZAByuTBHDbxXX7Fw6bw-nQW6MqSWVuaov91myNJ67MagLt2OIT31aDX-yxANOWMA75QrIlAZDuXa28atgdRF2jkGupETrUxK0UHdP3I60JQ3FbaNOsgC5ZEsCCr6RE/s400/48pullback2.jpg" width="400" /></a></div><div class="separator" style="clear: both; text-align: center;"><br />
</div>Over the past few weeks, stocks haven't done much, but the headlines continue to make it feel like the economy and markets are falling off the cliff. I think it is all part of a more complex bottoming process, which is usually required the deeper a decline goes. Between Greece and jobs and the debt ceiling and housing and QEII ending, it's tough to read the news. I would argue that if things are really as bad as the news suggests, stocks should be down a whole lot more than 8%. Judging from the action this week, that process appears to have ended with a rally beginning.<br />
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As most of you know, we use technical and quantitative inputs in our work as opposed to fundamental inputs. At the lows of the past few weeks, the stock market is now more oversold than it has been since the bull market began in 2009, even more so than during last spring's 17% correction. <br />
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Some of you may argue that we are no longer in a bull market and that's why the oversold readings don't matter as much. Given that the number of stocks advancing and declining (A/D line) hit an all time high in April along with junk bonds, that would be highly unusual. Even if that's the case, which I am not willing to concede on June 30, there is still supposed to be at least a failing rally. <br />
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My premise has been that from this decline, we will learn what kind of market lies ahead for the second half of 2011 based on the quality of the next rally. Which indices and sectors are leading and lagging. Is there broad participation? How do junk bonds and small caps, barometers of liquidity, behave?<br />
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Over the past few weeks, we have a whole host of indicators pointing to a bottom. The number of stocks advancing and declining on a daily basis is very washed out, too much selling too quickly. Most of the derivative indicators, like the McClellan Oscillator, are saying the same thing. <br />
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Volatility has increased dramatically from very low levels. Usually, it pauses or reverses after such a rise. According to AMG, investors have drained incredibly large amounts of money from equity mutual funds recently. At the same time, option traders on a variety of exchanges are becoming very defensive. Small option traders, usually mom & pop traders, have gone from exuberant to despondent in just a few weeks. <br />
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On an intra-day basis, we are seeing rolling large blocks of liquidation hitting extreme levels where rallies often begin. On the flip side, buying by corporate insiders has increased substantially and they are usually not wrong for very long. Add it all together and you get the recipe for a good stock market rally.<br />
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After a 6% or 8% pullback with the slew of indicators pointing to a low, we should be seeing constructive price action with at least some upside follow through. Until last Thursday, that was sorely missing. We now have a number of positive behavioral days with some follow through confirmation as you can see below.<br />
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<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhBOYO13n2rwsWRSLQJtAe8qbSiA8lZ597PY2clPM0H58bqa7XuI3OB1HuKoPyv1avbEINeNhQg8ulEn-mVfXnNnHlCQqvrLXO-eBK9Ztf87OGBW6uQWKZEczkQhMAzi5kjhn7oVzHiemM/s1600/48pullback3.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="277" i$="true" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhBOYO13n2rwsWRSLQJtAe8qbSiA8lZ597PY2clPM0H58bqa7XuI3OB1HuKoPyv1avbEINeNhQg8ulEn-mVfXnNnHlCQqvrLXO-eBK9Ztf87OGBW6uQWKZEczkQhMAzi5kjhn7oVzHiemM/s400/48pullback3.jpg" width="400" /></a></div><div class="separator" style="clear: both; text-align: center;"><br />
</div><div class="separator" style="clear: both; text-align: justify;"><span style="color: black; font-family: Verdana; font-size: 11pt; line-height: 115%; mso-ansi-language: EN-US; mso-bidi-font-family: "Times New Roman"; mso-bidi-language: AR-SA; mso-fareast-font-family: Calibri; mso-fareast-language: EN-US;">SO much attention has been paid to the level of 1250 on the S&P 500 (the March tsunami low), I was hoping for a quick plunge through that level to shake out the final bulls. Twice, price came closer, but no cigar. In a perfect world, price dives through 1250 for a day or so and causes more selling that makes headlines, only to see the bulls step up to reverse the trend and start a powerful that rally to trap the bears as the I tried to depict in the next chart.</span></div><div class="separator" style="clear: both; text-align: center;"><br />
</div><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjv_bgQ2Z-AKU3oBkIotAuibmobQWLWTQNPSPGnIFWOQGFKSBtQAUuDur-FSBAfg6MppqwZDpEQGfpvvTuKCrCSTDD1TJUvSl9eXdf7vVCU4Ba4iNwwtO4hjlLNUv5lQIdlUCfh2Bsyto8/s1600/1250.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="277" i$="true" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjv_bgQ2Z-AKU3oBkIotAuibmobQWLWTQNPSPGnIFWOQGFKSBtQAUuDur-FSBAfg6MppqwZDpEQGfpvvTuKCrCSTDD1TJUvSl9eXdf7vVCU4Ba4iNwwtO4hjlLNUv5lQIdlUCfh2Bsyto8/s400/1250.jpg" width="400" /></a></div><div class="separator" style="clear: both; text-align: center;"><br />
</div>On the surface, I believe a break of 1250 is more constructive for a longer and more meaningful rally than if the rally has already begun. A rally from here will leave unanswered questions and keep a scenario open for a decline below 1250 sometime during the third quarter. <br />
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FYI, I will be on CNBC’s Squawk on the Street on July 5 at 9:35 a.m. <br />
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Have a very safe and enjoyable holiday weekend!<br />
<br />
Feel free to email me with any questions or comments at Paul@investfortomorrow.com.<br />
<br />
<br />
Until next time…<br />
<br />
Paul Schatz<br />
Heritage Capital LLC<br />
<br />
<a href="http://www.investfortomorrow.com/">http://www.investfortomorrow.com/</a><br />
<a href="http://retirementplanningconnecticut.com/">http://RetirementPlanningConnecticut.com/</a><br />
<br />
Follow us on Facebook at www.facebook.com/heritagecapital and on Twitter @Paul_SchatzAngela Carterhttp://www.blogger.com/profile/12819817372215002169noreply@blogger.com1tag:blogger.com,1999:blog-2457150592733524440.post-63349566132057490852011-06-24T16:00:00.001-04:002011-07-01T13:06:57.163-04:00Ramblings on the Debt Crisis<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAnV3ZkJU0Np7RMzWQQh8TNCFJJep4wQ1xd9jQfqt8gcKdCrFPwVoL7QH3WV1qAaOBYmtuOJmDzXR_vKod6HMdyE_6NzHJ9vvNgprxNOEMrg70qBekXX5NMpAB_eaVB6JfbLLwOAaNdJc/s1600-h/PaulSchatz.jpg"><img alt="" border="0" id="BLOGGER_PHOTO_ID_5385080613162580258" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAnV3ZkJU0Np7RMzWQQh8TNCFJJep4wQ1xd9jQfqt8gcKdCrFPwVoL7QH3WV1qAaOBYmtuOJmDzXR_vKod6HMdyE_6NzHJ9vvNgprxNOEMrg70qBekXX5NMpAB_eaVB6JfbLLwOAaNdJc/s320/PaulSchatz.jpg" style="float: left; height: 320px; margin: 0px 10px 10px 0px; width: 258px;" /></a><br />
<em>(Editor's Note: Paul Schatz, President of Heritage Capital, LLC, in Woodbridge, will be contributing to Fi$callyFit every Friday. </em><a href="http://www.investfortomorrow.com/CallinShots.asp"><em>Read his biography here</em></a><em>)</em><br />
<br />
<br />
I have been asked a lot about the upcoming debt ceiling "crisis", how it would affect the markets and if we should position differently.<br />
<br />
Maybe I am too complacent, but at this point I do not believe there is anything serious brewing. I firmly believe that it's just another game of political chicken and someone will blink.<br />
<br />
Or maybe both sides blink. But I do not think that Congress gets to the point where they vote down a rise in the debt ceiling. That's an untenable position for a politician. <br />
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<br />
As an aside, I have heard several unconfirmed reports that it is unconstitutional to default on our debt. If that's true, I am sure the lawyers have lined up their cases. From my seat, the politicians will probably go to the 11th hour and then make a deal.<br />
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There have so many opinion pieces written about what to do about our debt and budget deficit. I have written much about this before, so I don't have a lot of new info. I firmly believe this has to be a bi-partisan solution. Congress cannot cut too much too quickly or we will end up in recession very soon. They can't do nothing because at this rate, there will be a debt crisis. <br />
<br />
I believe we need to cut $100B - $150B every year for at least the next decade. While that could stymie growth a bit and make us look more like Europe, there would be a light at the end of the tunnel. If we get a little luck, organic growth would increase tax receipts and help even more.<br />
<br />
Michael Boskin, former chairman of the council of economic advisors under Bush I, wrote a good piece last week in the Wall Street Journal regarding budget cuts and tax increases. The vast majority of the time (I think he put the number at 75%), tax increases do not lead to increased tax receipts, something I have long believed. Boskin opines that a workable ratio is $4 or $5 in budget cuts for every $1 in tax increases. I think that could be politically tenable and a decent bi-partisan solution. <br />
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I also believe that we are in dire need of tax reform. We desperately need to simplify the tax code. Broadening our tax base is a good start. Maybe that's a euphemism for a tax increase, something I have a hard time swallowing, but I don't think so. Our system is broken and needs repair. When someone making 10 million dollars is paying less tax than someone making what is now considered "rich" - $250,000 -something is really wrong.<br />
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Let's get rid of the absurd deductions that only the truly rich can take advantage of because they can afford the expensive lawyers to find loopholes. At the same time, we can actually cut the number of tax brackets and tax rates. With the energy and agricultural sectors booming like never before, I have a hard time swallowing tax breaks and worse, subsidies. But with lobbyists running Washington, that's a tall order to correct.<br />
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In this country it's still amazing that only about HALF actually pay income taxes. Yes, that's correct. Roughly 50% of Americans pay income tax. At the same time, given what you read in the media, you would think that the lower income earners are footing the bill for everyone else. It's simply not true. The ever shrinking, but much needed, middle class bears the brunt. When the middle class starts to grow again, you will know that our economy and country has embarked on another multi decade run of prosperity.<br />
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Feel free to email me with any questions or comments at Paul@investfortomorrow.com.<br />
<br />
Until next time…<br />
<br />
Paul Schatz<br />
Heritage Capital LLC<br />
<a href="http://www.investfortomorrow.com/">http://www.investfortomorrow.com/</a><br />
<a href="http://retirementplanningconnecticut.com/">http://RetirementPlanningConnecticut.com/</a><br />
<br />
Follow us on Facebook at www.facebook.com/heritagecapital and on Twitter @Paul_SchatzAngela Carterhttp://www.blogger.com/profile/12819817372215002169noreply@blogger.com0tag:blogger.com,1999:blog-2457150592733524440.post-83601249638687354412011-06-16T23:24:00.000-04:002011-06-16T23:24:14.282-04:00Questions to Ask Before You Consider Moving Assets to Another Advisor<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAnV3ZkJU0Np7RMzWQQh8TNCFJJep4wQ1xd9jQfqt8gcKdCrFPwVoL7QH3WV1qAaOBYmtuOJmDzXR_vKod6HMdyE_6NzHJ9vvNgprxNOEMrg70qBekXX5NMpAB_eaVB6JfbLLwOAaNdJc/s1600-h/PaulSchatz.jpg"><img alt="" border="0" id="BLOGGER_PHOTO_ID_5385080613162580258" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAnV3ZkJU0Np7RMzWQQh8TNCFJJep4wQ1xd9jQfqt8gcKdCrFPwVoL7QH3WV1qAaOBYmtuOJmDzXR_vKod6HMdyE_6NzHJ9vvNgprxNOEMrg70qBekXX5NMpAB_eaVB6JfbLLwOAaNdJc/s320/PaulSchatz.jpg" style="float: left; height: 320px; margin: 0px 10px 10px 0px; width: 258px;" /></a><em>(Editor's Note: Paul Schatz, President of Heritage Capital, LLC, in Woodbridge, will be contributing to Fi$callyFit every Friday. </em><a href="http://www.investfortomorrow.com/CallinShots.asp"><em>Read his biography here</em></a><em>)</em><br />
<br />
<span style="color: #002060; font-family: "Verdana","sans-serif";"><span style="color: black;"> A fact of life every adviser faces is the knowledge that our clients regularly receive solicitations from other advisers, money managers, brokers and investment companies.</span></span><br />
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<span style="color: #002060; font-family: "Verdana","sans-serif";"><span style="color: black;">Some clients will leave to take advantage of those offers. What really hurts, however, is seeing former clients damaged by poor advice, or advice that does not take into consideration the client’s situation.</span></span><br />
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<span style="color: #002060; font-family: "Verdana","sans-serif";"><span style="color: black;"> With that in mind, we present questions you should ask of any adviser who solicits your confidence and the management of your financial assets:<o:p></o:p></span></span><br />
<span style="color: black;"> </span><br />
<div class="style13" style="margin: 1em 0in;"><strong><span style="color: #002060; font-family: "Verdana","sans-serif"; mso-bidi-font-family: Arial;"><span style="color: black;">What is the adviser’s experience and how will your assets be managed?</span></span></strong><span style="color: #002060; font-family: "Verdana","sans-serif";"><br />
<span style="color: black;"> </span></span><span style="color: #002060; font-family: "Verdana","sans-serif";"><span style="color: black;">Don’t just accept the adviser’s word. Verify. </span></span></div><div class="style13" style="margin: 1em 0in;"><span style="color: #002060; font-family: "Verdana","sans-serif";"><span style="color: black;">Information on a Registered Investment Adviser can be found throught the <a href="http://www.adviserinfo.sec.gov/(S(clzgdlh5enqmow4b42qwj4f3))/IAPD/Content/IapdMain/iapd_SiteMap.aspx">Securities Exchange Commisison</a> (SEC).</span><span style="color: black;"> Information on brokerage firms and individual brokers can be found <a href="http://www.finra.org/Investors/ToolsCalculators/BrokerCheck/">here</a>. </span></span><span style="color: #002060; font-family: "Verdana","sans-serif";"><span style="color: black;">If the individual is not registered, it is a red flag.</span></span><br />
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<span style="color: #002060; font-family: "Verdana","sans-serif";"><span style="color: black;">If the individual uses a particular investment approach, find out how long it has been in use and what the results are. Results too good to be true usually aren’t.<o:p></o:p></span></span></div><strong><span style="color: #002060; font-family: "Verdana","sans-serif"; mso-bidi-font-family: Arial;"><span style="color: black;">How will your assets be held?</span></span></strong><span style="color: #002060; font-family: "Verdana","sans-serif";"><br />
<span style="color: black;"> Ideally, your assets should be invested in a separate account in your name at a national custodian or brokerage firm. You should be able to independently verify the status of your account. Your adviser should have no access to funds in the account other than a preauthorized ability to withdraw periodic fees. If you do not have transparency, your risk increases. Deposits should never be made out to the individual.<o:p></o:p></span></span><br />
<span style="color: black;"> </span><br />
<strong><span style="color: #002060; font-family: "Verdana","sans-serif"; mso-bidi-font-family: Arial;"><span style="color: black;">How is the adviser compensated? </span></span></strong><span style="color: #002060; font-family: "Verdana","sans-serif";"><br />
<span style="color: black;"> Does that compensation present a possible conflict of interest? If the individual is paid to solicit your investment in a specific money manager or investment vehicle, is their advice unbiased and in your best interest?</span></span><br />
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<strong><span style="color: #002060; font-family: "Verdana","sans-serif"; mso-bidi-font-family: Arial;"><span style="color: black;">Has the adviser asked the right questions? </span></span></strong><span style="color: #002060; font-family: "Verdana","sans-serif";"><br />
<span style="color: black;"> Your adviser should understand what you want to accomplish and how a recommended investment fits with your financial situation. You don’t want an adviser who is selling a solution without finding out what you need. <o:p></o:p></span></span><br />
<span style="color: black;"> </span><br />
<strong><span style="color: #002060; font-family: "Verdana","sans-serif"; mso-bidi-font-family: Arial;"><span style="color: black;">Is the recommended investment appropriate for you?</span></span></strong><span style="color: #002060; font-family: "Verdana","sans-serif";"><br />
<span style="color: black;"> You know best what you need in terms of capital preservation, how much and when you will need income from your investments, liquidity, ability to pass on to heirs, etc. If the individual is not asking you about those needs, you need to ask those questions. Make certain you understand the answers and preferably have them in writing. Verbal promises and assurances are not enforceable in court.</span></span><br />
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<strong><span style="color: #002060; font-family: "Verdana","sans-serif"; mso-bidi-font-family: Arial;"><span style="color: black;">If the investment does not work out as anticipated, what is the individual’s exit plan? </span></span></strong><span style="color: #002060; font-family: "Verdana","sans-serif";"><br />
<span style="color: black;"> Will they strive to protect your investment or are you on your own once you invest?<o:p></o:p></span></span><br />
<span style="color: black;"> </span><br />
<strong><span style="color: #002060; font-family: "Verdana","sans-serif"; mso-bidi-font-family: Arial;"><span style="color: black;">How much will it cost to implement the new adviser’s solution?</span></span></strong><span style="color: #002060; font-family: "Verdana","sans-serif";"><br />
<span style="color: black;"> If you are required to liquidate assets, what costs will be incurred liquidating those assets?</span></span><br />
<div class="style13" style="margin: 1em 0in;"><span style="color: #002060; font-family: "Verdana","sans-serif";"><span style="color: black;">This is particularly important when liquidating insurance products. Has the new adviser given any consideration to capturing dividends prior to selling assets? What will it cost to purchase recommended investments? Will those investments be liquid or will you have to commit to a holding period?<o:p></o:p></span></span></div><strong><span style="color: #002060; font-family: "Verdana","sans-serif"; mso-bidi-font-family: Arial;"><span style="color: black;">And then, ask yourself why you are considering the new adviser.</span></span></strong><span style="color: #002060; font-family: "Verdana","sans-serif";"><br />
<span style="color: black;"> If you are dissatisfied with some aspect of our services, we would like an opportunity to talk to you about the issue before you make any changes. If your answer is because you like the individual, you want to help them out or you feel pressured to make the change by the individual or another adviser, step back and give yourself time to reconsider your decision.</span></span><br />
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<span style="color: #002060; font-family: "Verdana","sans-serif";"><span style="color: black;">Your first priority should be the safety and profitability of your assets. There will always be another opportunity to invest in the next greatest thing as long as you have not lost your assets on a poor decision. <o:p></o:p></span></span><br />
<span style="color: black;"> </span><br />
<br />
<div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><span style="color: black;">Feel free to email me with any questions or comments at </span><a href="mailto:Paul@investfortomorrow.com"><span style="color: #002060;"><span style="color: black;">Paul@investfortomorrow.com</span></span></a><span style="color: black;">.<o:p></o:p></span></span></div><span style="color: black;"> </span><br />
<div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><span style="color: black;">Until next time…<o:p></o:p></span></span></div><span style="color: black;"> </span><br />
<span style="color: black;"> </span><br />
<div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><span style="color: black;">Paul Schatz<o:p></o:p></span></span></div><span style="color: black;"> </span><br />
<div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><span style="color: black;">Heritage Capital LLC<o:p></o:p></span></span></div><span style="color: black;"> </span><br />
<div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><a href="http://www.investfortomorrow.com/"><span style="color: #002060;"><span style="color: black;">http://www.InvestForTomorrow.com</span></span></a></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><a href="http://retirementplanningconnecticut.com/"><span style="color: #002060;"><span style="color: black;">http://RetirementPlanningConnecticut.com/</span></span></a><o:p></o:p></span></div><span style="color: black;"> </span><br />
<div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><span style="color: black;">Follow us on Facebook at </span><a href="http://www.facebook.com/heritagecapital"><span style="color: #002060;"><span style="color: black;">www.facebook.com/heritagecapital</span></span></a><span style="color: black;"> and on Twitter @Paul_Schatz</span></span></div>Angela Carterhttp://www.blogger.com/profile/12819817372215002169noreply@blogger.com0tag:blogger.com,1999:blog-2457150592733524440.post-14006724359049984382011-06-16T23:06:00.000-04:002011-06-16T23:06:52.005-04:00Thomson Reuters Sentiment Index: Health care consumer confidence steadied in MayAmericans’ confidence in their ability to access and pay for health care improved in May, according to a consumer sentiment index produced by Thomson Reuters. <br />
Respondents surveyed for the index reported an improved outlook when asked if they had experienced a reduction in or loss of insurance coverage in the past three months. Overall, the Thomson Reuters Consumer Healthcare Sentiment Index rose three points from 95 in April to 98 in May, a statistically significant increase.<br />
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“This recovery in confidence is encouraging when compared with last month’s numbers, but the month-to-month variability in sentiment could be an indication of underlying uncertainty among health care consumers,” said Gary Pickens, chief research officer at the Thomson Reuters Center for Health care Analytics. <br />
<br />
The index, which is based on the Thomson Reuters PULSE™ Healthcare Survey is updated monthly.<br />
<br />
The Thomson Reuters PULSE Healthcare Survey collects information about health care behaviors, attitudes and utilization from more than 100,000 U.S. households annually. It is representative of all United States adults and households. The Consumer Healthcare Sentiment Index is based on responses from a survey subset of 3,000 respondents each month. Its baseline measurement of 100 was set in December 2009.Angela Carterhttp://www.blogger.com/profile/12819817372215002169noreply@blogger.com0tag:blogger.com,1999:blog-2457150592733524440.post-1948540577725238312011-06-16T23:02:00.000-04:002011-06-16T23:02:12.043-04:00IRS grants go to Quinnipiac University and UConnThe <a href="http://www.irs.gov/">Internal Revenue Service</a> has awarded nearly $10 million in matching grants to Low-Income Taxpayer Clinics (LITCs) for the 2011 grant cycle, including two recipients from Connecticut.<br />
The IRS awarded $75,000 to <a href="http://www.quinnipiac.edu/">Quinnipiac University</a> in Hamden and $88,000 to the University of Connecticut's <a href="http://www.hartford.uconn.edu/">Greater Hartford campus</a>.<br />
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LITCs are organizations that represent low-income taxpayers in federal tax controversies with the IRS for free or for a nominal charge and/or provide tax education and outreach for taxpayers who speak English as a second language.<br />
<br />
Through the LITC program, the IRS awards matching grants of up to $100,000 a year to qualifying organizations.<br />
<br />
Questions about the LITC Program can be addressed to the LITC Program Office at (202) 622-4711 (not a toll-free call) or by e-mail at LITCProgramOffice@irs.gov. <a href="http://www.irs.gov/pub/irs-utl/publication_4134_2008.pdf">IRS Publication 4134, Low-Income Taxpayer Clinic List</a>, provides information on LITCs in each geographic area and the languages each clinic serves in addition to English.Angela Carterhttp://www.blogger.com/profile/12819817372215002169noreply@blogger.com0tag:blogger.com,1999:blog-2457150592733524440.post-81842011894685638772011-06-10T09:30:00.003-04:002011-06-24T15:51:54.351-04:00The 6 Week Nap<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAnV3ZkJU0Np7RMzWQQh8TNCFJJep4wQ1xd9jQfqt8gcKdCrFPwVoL7QH3WV1qAaOBYmtuOJmDzXR_vKod6HMdyE_6NzHJ9vvNgprxNOEMrg70qBekXX5NMpAB_eaVB6JfbLLwOAaNdJc/s1600-h/PaulSchatz.jpg"><img alt="" border="0" id="BLOGGER_PHOTO_ID_5385080613162580258" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAnV3ZkJU0Np7RMzWQQh8TNCFJJep4wQ1xd9jQfqt8gcKdCrFPwVoL7QH3WV1qAaOBYmtuOJmDzXR_vKod6HMdyE_6NzHJ9vvNgprxNOEMrg70qBekXX5NMpAB_eaVB6JfbLLwOAaNdJc/s320/PaulSchatz.jpg" style="float: left; height: 320px; margin: 0px 10px 10px 0px; width: 258px;" /></a><br />
<em>(Editor's Note: Paul Schatz, President of Heritage Capital, LLC, in Woodbridge, will be contributing to Fi$callyFit every Friday. </em><a href="http://www.investfortomorrow.com/CallinShots.asp"><em>Read his biography here</em></a><em>)</em><br />
<br />
<span style="mso-bookmark: "LETTER.BLOCK15";"></span><br />
<div class="MsoNormal" style="line-height: normal; margin: 0in 0in 7.5pt;"><span style="color: #000099; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-fareast-font-family: "Times New Roman";"><span style="color: black;">Imagine you have been asleep for six weeks and just woke up. The stock market has declined five straight weeks, a rare occurrence, and is working on six today. </span></span><br />
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<span style="color: #000099; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-fareast-font-family: "Times New Roman";"><span style="color: black;">The sovereign debt crisis in Europe is percolating again with Greece, Ireland and Spain teetering. Last Friday's employment report, as you can see below, showed very few jobs being created in May with unemployment ticking slightly higher again. As I have mentioned before, if this was a normal recovery, job growth would be soaring right about now. Since mid 2010, we are more like hovering.</span></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 7.5pt;"></div><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi657yyro53W-EOh8Ej1MMYrl2VHcf3mD4kIdD8usmXAUILvdtgxlH_vXq_Nm1kBRV6LgaCbxHmpOfP7vS9Hv1s0aaFvK6wNU-JqktpjkiotS_XuOs9Mta_SRdp6u3s9yKSQSr9GDaXzls/s1600/Jobsreport.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="222" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi657yyro53W-EOh8Ej1MMYrl2VHcf3mD4kIdD8usmXAUILvdtgxlH_vXq_Nm1kBRV6LgaCbxHmpOfP7vS9Hv1s0aaFvK6wNU-JqktpjkiotS_XuOs9Mta_SRdp6u3s9yKSQSr9GDaXzls/s400/Jobsreport.jpg" width="400" /></a></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 7.5pt;"><br />
<span style="color: black;"><span style="color: #000099; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-fareast-font-family: "Times New Roman";"><span style="color: black;">Bernanke & Company's QEII, which pumped $600B into the system will be ending in a few short weeks. And the S&P Case Shiller Index of home prices just hit an eight year low. Yes, you read that right. Home prices, except the ones we are trying to buy, continue to make post crisis new lows and are back to levels not seen since 2002 and 2003.</span></span></span></div><span style="color: black;"></span><br />
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<div class="MsoNormal" style="line-height: normal; margin: 0in 0in 7.5pt;"><span style="color: #000099; font-family: "Verdana", "sans-serif"; font-size: 12pt; line-height: 115%; mso-ansi-language: EN-US; mso-bidi-font-family: "Times New Roman"; mso-bidi-language: AR-SA; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-US;"><span style="color: black;">You would be hard-pressed to "feel good" right now. One would have thought that stocks would be down 10-20% with this horrible backdrop. But they are not. From high to low, the stock market has pulled back 6%, yet another 4-8% pullback that I keep discussing.</span></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 7.5pt;"></div><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjf-n4J4f9EljaCvVipf9r2QFu9ZV2gI3_jx_MPdu3lnWff341YIkr-2t_yRoxlI9EQVdu9hZihrZQRJHJzMY5vIe22EsBVp_FnEeRI2JZrbfRbuxHAqCL6xnWkyffMZIyPS5fJa_R5f8U/s1600/pullback.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="277" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjf-n4J4f9EljaCvVipf9r2QFu9ZV2gI3_jx_MPdu3lnWff341YIkr-2t_yRoxlI9EQVdu9hZihrZQRJHJzMY5vIe22EsBVp_FnEeRI2JZrbfRbuxHAqCL6xnWkyffMZIyPS5fJa_R5f8U/s400/pullback.jpg" width="400" /></a></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 7.5pt;"><br />
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<span style="color: #000099; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-fareast-font-family: "Times New Roman";"><span style="color: black;">If you add in the somewhat extreme nature of the selling wave along with the surge in investors buying protective put options and newsletter writers more bearish than bullish for five consecutive weeks, you have all the makings for at least a short-term low. I am going to stick my neck out and say that the bottom is not in place yet and will likely need one more selling wave to hammer in. </span></span></div><span style="color: black;"></span><br />
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<div class="MsoNormal" style="line-height: normal; margin: 0in 0in 7.5pt;"><span style="color: black;"><span style="color: black; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-fareast-font-family: "Times New Roman";">My theme for a while has been that there should be at least one more stock market rally left IF there is a big correction coming in Q3. I still believe that. All the makings are there. Failure to rally in the coming weeks would usher in some not so pleasant memories of bear markets passed, which would mean sharply lower prices very soon. But we can cross that bridge if and when it happens.</span><span style="color: #000099; font-family: "Verdana", "sans-serif";"></span></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 7.5pt;"><span style="color: black; font-family: Times New Roman;"></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 7.5pt;"><span style="color: navy; font-family: "Verdana", "sans-serif";"><span style="color: black;">FYI, I will be on CNBC’s Squawk Box at 6:10am on June 13.</span></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 7.5pt;"><span style="color: black; font-family: Times New Roman;"></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><span style="color: black;">Feel free to email me with any questions or comments at </span><a href="mailto:Paul@investfortomorrow.com"><span style="color: #002060;"><span style="color: black;">Paul@investfortomorrow.com</span></span></a><span style="color: black;">.</span></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 7.5pt;"><span style="color: black; font-family: Times New Roman;"></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><span style="color: black;">Until next time…</span></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 7.5pt;"><span style="color: black; font-family: Times New Roman;"></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><span style="color: black;">Paul Schatz</span></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 7.5pt;"><span style="color: black; font-family: Times New Roman;"></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><span style="color: black;">Heritage Capital LLC</span></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><a href="http://www.investfortomorrow.com/"><span style="color: #002060;"><span style="color: black;">http://www.InvestForTomorrow.com</span></span></a></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><a href="http://retirementplanningconnecticut.com/"><span style="color: #002060;"><span style="color: black;">http://RetirementPlanningConnecticut.com/</span></span></a></span><span style="color: #002060; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"> </span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 7.5pt;"><span style="color: black; font-family: Times New Roman;"></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><span style="color: black;">Follow us on Facebook at </span><a href="http://www.facebook.com/heritagecapital"><span style="color: #002060;"><span style="color: black;">www.facebook.com/heritagecapital</span></span></a><span style="color: black;"> and on Twitter @Paul_Schatz</span></span></div><br />
<div class="MsoNormal" style="line-height: normal; margin: 0in 0in 7.5pt;"><span style="font-family: Times New Roman;"></span></div><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiidcalxwqjrzzwLdgZqYf76gQQo5cMnOjW3f-oV9ESD2LrNfW_ai7p89xDQ0lkzNIZcUSc262kmS9Zks3N8cKvGnD_eCz__Pna7q3v5zEVLcGvs52qSoSxaqHMQys6ahZpUZ71UfkF0UY/s1600/RealHousePrices.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="266" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiidcalxwqjrzzwLdgZqYf76gQQo5cMnOjW3f-oV9ESD2LrNfW_ai7p89xDQ0lkzNIZcUSc262kmS9Zks3N8cKvGnD_eCz__Pna7q3v5zEVLcGvs52qSoSxaqHMQys6ahZpUZ71UfkF0UY/s400/RealHousePrices.jpg" width="400" /></a></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 7.5pt;"></div>Angela Carterhttp://www.blogger.com/profile/12819817372215002169noreply@blogger.com0tag:blogger.com,1999:blog-2457150592733524440.post-50421753471337314072011-06-08T18:25:00.000-04:002011-06-08T18:25:06.066-04:00Merchant win over banks on debit card fees not so clear for consumers<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgt-9nRshChb14yosOdoAqE-lI2cRGhOqXixx7vn6pe7mJ0RMhY4JU7iGTeoX0hQsL0Zm70rO9DVrdp3-EsneCCtRGEOHLBxbnOi_VUdY9Y3tgw0DLqDaR95GJayj3bCz9UFIi5NbjvtAo/s1600/credit_card_logos_10.gif" imageanchor="1" style="clear: right; cssfloat: right; float: right; margin-bottom: 1em; margin-left: 1em;"><img border="0" height="47" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgt-9nRshChb14yosOdoAqE-lI2cRGhOqXixx7vn6pe7mJ0RMhY4JU7iGTeoX0hQsL0Zm70rO9DVrdp3-EsneCCtRGEOHLBxbnOi_VUdY9Y3tgw0DLqDaR95GJayj3bCz9UFIi5NbjvtAo/s320/credit_card_logos_10.gif" t8="true" width="320" /></a></div>By FI$CALLYFIT and the Associated Press <br />
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WASHINGTON — Merchants triumphed over bankers in a battle for billions Wednesday as the Senate voted to let the Federal Reserve curb the fees that stores pay financial institutions when a customer swipes a debit card. It was murkier, however, whether the nation’s consumers were winners or losers. <br />
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As a result of the roll call, the Fed will be allowed to issue final rules on July 21 trimming the average 44 cents that banks charge for each debit card transaction. That fee, typically 1 to 2 percent of each purchase, produces $16 billion in annual revenue for banks and credit card companies, the Fed estimates. <br />
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The central bank has proposed capping the so-called interchange fee at 12 cents, though the final plan could change slightly.<br />
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Frank Keating, president and chief executive officer of the American Bankers Association said the ABA "along with the thousands of community banks we represent, is deeply disappointed with the outcome of today’s Senate vote."<br />
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American consumers will now have to pay more for basic banking services and community banks also will suffer, he said. "They will see a reduction in a key source of revenue that allows them to offer low-cost banking services to everyday consumers and supports lending and fraud protection measures. Key banking regulators have unequivocally stated that small banks will be harmed by the underlying Durbin amendment. It is simply unconscionable that the Senate would not act to protect community banks from this destructive effect," Keating said.<br />
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Victorious merchants said the lowered fees should let them drop prices, banks said they could be forced to boost charges for things like checking accounts to make up for lost earnings and each side challenged the other’s claims.<br />
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Consumer groups were not a united front, either: While the consumer group U.S. PIRG said consumers would benefit, the Consumer Federation of America took no formal stance but said it was concerned about what both industries might do. <br />
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Travis B. Plunkett, the consumer federation’s legislative director, said the amount of savings that stores pass on to consumers would depend on how competitive their markets are. He said he also worried that the Fed’s current proposal might be too restrictive, which might tempt banks to “use that as an excuse to increase charges on customers they value the least, low- to moderate-income customers.” <br />
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In Wednesday’s vote, senators trying to thwart the Fed’s rules needed 60 votes to prevail but fell six votes short, 54-45. That delivered a victory for Sen. Richard Durbin, D-Ill., the Senate’s No. 2 Democrat, who muscled the provision into last year’s financial overhaul law requiring the Fed’s action. <br />
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Wednesday’s roll call shot down a proposal by Sens. Jon Tester, D-Mont., and Bob Corker, R-Tenn., that would have delayed the Fed rule for a year. In the meantime, the Fed and three other agencies would have studied whether the Fed’s current proposal is fair and rewritten it if at least two agencies decided it wasn’t. <br />
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Edmund Mierzwinski, consumer program director for US PIRG, which represents state public interest research groups, said some banks might curtail the rewards programs that many attach to their debit cards, such as awarding cash back or airline miles. But he said checking account fees would not rise. <br />
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“There will be competition,” Mierzwinski said. “Banks will be forced to come up with innovative ways to lower costs in their card networks.” <br />
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Camden R. Fine, president of the Independent Community Bankers of America, challenged that, saying the Senate vote would mean that “consumers of lower socio-economic status will get hammered” because bank fees would rise. <br />
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“Where do people think banks get the money to subsidize these products” like free checking accounts, he said. He also challenged assertions that stores would pass the savings from lower fees to customers. <br />
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“Does anybody not smoking dope believe merchants will pass some big windfall to consumers?” he said, adding later, “I mean, what are they going to cut prices by, a penny?” <br />
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Merchants, however, argue that they will be forced to lower prices to reflect the curbed debit card fees. <br />
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“The retail industry is the most competitive business environment going today,” said Brian Dodge, spokesman for the Retail Industry Leaders Association, which represents many large merchants like Target and Home Depot. “There is no doubt competition would drive any interchange savings out of the system, which would be reflected by lower prices.” <br />
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Affirming that was Dennis Lane, who has owned a 7-Eleven store in Quincy, Mass., for 37 years. He said he pays $7,000 to $10,000 annually in credit card swipe fees. <br />
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“Whenever I can reduce my cost of doing business, any responsible retailer reduces costs to the consumer,” he said. He also said those savings could allow him to hire summer workers. <br />
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On the other hand, the head of a credit union in Mountain Home, Idaho, said slashing debit cards fees would have a huge cost for his business. <br />
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Curt Perry, president of Pioneer Federal Credit Union, says cutting the fee to 12 cents per swipe would cost him $780,000 a year. The new fee system would not take into account such expenses as covering fraud, which he said cost him $170,000 last year, leaving him considering options like charging a fee for debit cards or checking accounts. <br />
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<div class="separator" style="clear: both; text-align: center;"></div>“We’d have to pass that on, we’d need to generate that revenue from somewhere,” he said.Angela Carterhttp://www.blogger.com/profile/12819817372215002169noreply@blogger.com0tag:blogger.com,1999:blog-2457150592733524440.post-82362940761938334222011-06-03T21:00:00.001-04:002011-06-10T18:05:12.799-04:00Save your receipts: Summer day camps may reap tax benefits<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj6ZYw-BzHtnfxmS9fAJVvTbHiU9JVRYlBmiMR91eCWYSWj9QvZQ2ZpJsB8OaZ9A7F0_dJaWfyYc3qpTsasElmQJ3-1YCQuoIjvHNYVWtBn8fbJQIlmOIv2oAIsvjiAhhxFVaI4l-J1lXk/s1600/UncleSamHat.png" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" height="185" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj6ZYw-BzHtnfxmS9fAJVvTbHiU9JVRYlBmiMR91eCWYSWj9QvZQ2ZpJsB8OaZ9A7F0_dJaWfyYc3qpTsasElmQJ3-1YCQuoIjvHNYVWtBn8fbJQIlmOIv2oAIsvjiAhhxFVaI4l-J1lXk/s200/UncleSamHat.png" width="200" /></a><em><span style="color: #660000;"></span></em></div><em><span style="color: #cc0000;">Many working parents must arrange for care of their children age 12 or under during the school vacation period.</span></em><br />
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<em><span style="color: #cc0000;">A popular solution — with favorable tax consequences — is a day camp program. Unlike overnight camps, the cost of day camp may count as an expense toward the Child and Dependent Care Credit.</span></em> <br />
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<strong>Here are five facts the <a href="http://www.irs.gov/">Internal Revenue Service</a> wants you to know about a tax credit available for child care expenses:</strong> <br />
<ol><li>The Child and Dependent Care Credit is available for expenses incurred during the summer and throughout the year.</li>
<li>An expense for an overnight camp does not qualify.</li>
<li>If your childcare provider is a sitter at your home or a daycare facility outside the home, you'll get some tax benefit if you qualify for the credit.</li>
<li>The actual credit can be up to 35 percent of your qualifying expenses, depending upon your income.</li>
<li>You may use up to $3,000 of the unreimbursed expenses paid in a year for one qualifying individual or $6,000 for two or more qualifying individuals to figure the credit.</li>
</ol>For more information check out <a href="http://www.irs.gov/pub/irs-pdf/p503.pdf">IRS Publication 503, Child and Dependent Care Expenses</a>. This publication is also available by calling 800-TAX-FORM (800-829-3676).Angela Carterhttp://www.blogger.com/profile/12819817372215002169noreply@blogger.com0tag:blogger.com,1999:blog-2457150592733524440.post-61432813653816336862011-06-03T08:25:00.000-04:002011-06-03T08:25:11.366-04:00Painful Solutions to our Debt Crisis<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAnV3ZkJU0Np7RMzWQQh8TNCFJJep4wQ1xd9jQfqt8gcKdCrFPwVoL7QH3WV1qAaOBYmtuOJmDzXR_vKod6HMdyE_6NzHJ9vvNgprxNOEMrg70qBekXX5NMpAB_eaVB6JfbLLwOAaNdJc/s1600-h/PaulSchatz.jpg"><img alt="" border="0" id="BLOGGER_PHOTO_ID_5385080613162580258" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAnV3ZkJU0Np7RMzWQQh8TNCFJJep4wQ1xd9jQfqt8gcKdCrFPwVoL7QH3WV1qAaOBYmtuOJmDzXR_vKod6HMdyE_6NzHJ9vvNgprxNOEMrg70qBekXX5NMpAB_eaVB6JfbLLwOAaNdJc/s320/PaulSchatz.jpg" style="float: left; height: 320px; margin: 0px 10px 10px 0px; width: 258px;" /></a><em>(Editor's Note: Paul Schatz, President of Heritage Capital, LLC, in Woodbridge, will be contributing to Fi$callyFit every Friday. </em><a href="http://www.investfortomorrow.com/CallinShots.asp"><em>Read his biography here</em></a><em>)</em><br />
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Last week’s contribution - <a href="http://fiscallyfitnhr.blogspot.com/2011/05/inflation-i-spit-in-your-face.html">"Inflation? I Spit in your Face!"</a> drew an interesting question.<br />
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How does our national debt factor into the equation of my non systemic inflation argument? The answer is an easy one and somewhat of a copout. It depends on how the government intends to correct our addiction to the debt problem and looming crisis. Debt in itself is inherently deflationary if you agree with the premise that it must be serviced and eventually repaid. The whole process of deleveraging, reducing the amount of debt, is anything but inflationary for individuals and companies as we saw in 2008 on steroids! <br />
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Let’s walk through some scenarios on how Uncle Sam can attempt to fix the problem.<br />
One way to eradicate ourselves of debt is print our way out. The Federal Reserve would monetize by essentially printing money and buying up all of the Treasury bonds, notes and bills. As you can imagine, that would flood the system with more money than it has ever seen and likely cause our currency to completely collapse, which would make all assets denominated in dollars (oil, grains and other commodities) skyrocket to crisis levels. It would also likely trigger more systemic inflation with money velocity soaring along with wages. <br />
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Think about the million, billion and trillion dollar Zimbabwe notes or the Weimar Republic post WWI with folks using wheelbarrows full of money to buy groceries from always bare store shelves. Dollars would be worth much more today than tomorrow so people would spend them as fast as they came in. Prices and interest rates would rise day after day, week after week and month after month until the crisis abated. The U.S. Treasury and government would also lose credibility and investment grade credit ratings around the world for a measurable period of time. Our economy would likely collapse.<br />
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The opposite end of the spectrum would be strict austerity to cure our debt problems. In that case, government spending would be cut, cut and cut some more, triggering rolling recessions with intermittent periods of stability rather than recoveries. In an extreme case, as we’ve seen abroad, strikes, protests and even riots could fill our city streets. It would “feel bad” for an extended period of time, perhaps a decade or more, but the U.S. would emerge with a very lean and competitive society at the end.<br />
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The best possible - and most unlikely - scenario to cure our debt problem would come from organic economic growth. By growing the economy, the percentage of debt to GDP would be reduced, not to mention all the added tax revenue that would come in to the Treasury. I don’t think anyone really thinks this can work now.<br />
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One proposal in Congress that I totally disagree with is to simply raise taxes on the wealthy to solve the countries addiction to debt. To begin with, I have seen study after study that shows decreased tax receipts from an increase in tax rates. Increasing tax rates generally hinders economic growth. Additionally, roughly 75% of all discretionary spending (cars, travel, non-staple retailers, leisure, etc.) is done by those making $250,000 or more. How do you think that group would react to having their tax rates rise dramatically? In fact, many of those folks are small business owners, which our economy is built on, and run their finances through their personal tax returns. How do you think a sharp rise in taxes would affect their hiring?<br />
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Before someone responds by telling me to look at how well the economy did with higher tax rates under Bill Clinton, those were different fiscal times. We did not have a debt crisis or a structural unemployment problem. The ground was very fertile for growth in the mid 1990s following the S&L Crisis and recession of the early 1990s. <br />
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Look, in the 1940s, the top tax rate was more than 70 percent! And the economy grew like a weed. I can’t imagine anyone arguing that our economy could survive rates even close to that today. It would be worse than the Great Depression. My belief is that trajectory is more important than the absolute rate. By cutting taxes from 70% to 60%, that is incredibly stimulative. By raising taxes from 30% to 40%, it is highly restrictive. <br />
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I have said for three years that we have run out of painless solutions. It’s going to hurt! Pick your poison. If I were in Congress and not beholden to special interests (HA!), I would cut $100B to $150B from the federal budget every year for the next 10 years. No area would be unscathed, including entitlements and defense. That would certainly curtail growth and make us look more like a European country than the U.S. <br />
At the same time, I would completely revamp the tax system and broaden the tax base. Too many people have used gimmicks and loopholes to avoid paying taxes. We need to remove so many of the insane deductions and credits. The time has come. Sorry big oil, but you have made hundreds of billions of dollars over the past decade and your subsidies and tax credits are absurd. Sorry big corporate farms, but paying you not to grow crops is ridiculous when food prices are at all time highs. When we had a glut of crops and the farming industry was on the verge of extinction, I may not have agreed with the subsidy, but I understood. Now it’s an embarrassment. <br />
At the same time, we need to incentivize R&D in cleaner and greener energy, but not superficially as we’ve seen. We really need to make it appealing for entrepreneurs. Look at how many of the great companies were born during a recession in someone’s garage. Anyone know of a company called Microsoft? The government needs to step up and allow that ground to be fertile again. <br />
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Finally, I would be naïve if I thought this could get through Congress without any compromise. While I do not believe in higher taxes, especially in the corporate world where companies just park themselves offshore, I understand that there has to be some give and take. On the social security front, I would accept raising the tax rate and the amount where it is capped in return for also raising the age to 70 over the coming decade or so with further increases if life expectancy increases.<br />
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So in the end, I believe there is only one scenario where our debt crisis leads to systemic inflation and I do not think that path is likely. We have become a country of instant gratification and whiners, me included. If America is truly going to solve our debt problems and reliance on foreign capital, we are all going to have to sacrifice over this decade.<br />
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FYI, I will be on CNBC’s Worldwide Exchange from 5:35 a.m. to 5:55 a.m. on June 7.<br />
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Feel free to email me with any questions or comments at Paul@investfortomorrow.com.<br />
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Until next time…<br />
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Paul Schatz<br />
Heritage Capital LLC<br />
<a href="http://www.investfortomorrow.com/">http://www.investfortomorrow.com/</a><br />
<a href="http://retirementplanningconnecticut.com/">http://RetirementPlanningConnecticut.com/</a><br />
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Follow us on Facebook at www.facebook.com/heritagecapital and on Twitter @Paul_SchatzAngela Carterhttp://www.blogger.com/profile/12819817372215002169noreply@blogger.com0tag:blogger.com,1999:blog-2457150592733524440.post-61532819410720235372011-06-03T08:15:00.000-04:002011-06-03T08:18:56.381-04:007 Practical Gifts for College Grads<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgK0vpppJC5nD36co94llN8MMnpTcrjDVvfxv5Aq6cCAusP0aU0iaxLmldGjZuRaJLtVMkHFT7ODBdnSuVgIJwq7xd17Kkd60Ql_-jOURpshu9UJa9Bl6hzzztvHCYI4B5lFDu4fIvrcyU/s1600/awblue.jpg" imageanchor="1" style="clear: left; cssfloat: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" height="200" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgK0vpppJC5nD36co94llN8MMnpTcrjDVvfxv5Aq6cCAusP0aU0iaxLmldGjZuRaJLtVMkHFT7ODBdnSuVgIJwq7xd17Kkd60Ql_-jOURpshu9UJa9Bl6hzzztvHCYI4B5lFDu4fIvrcyU/s200/awblue.jpg" t8="true" width="133" /></a></div><em><strong><span style="color: #660000;">Consumer savings expert Andrea Woroch has been featured as a media expert source on NBC's Today Show, FOX & Friends, MSNBC, ABC News NOW and many more.</span></strong></em><br />
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Sure, an all-expense-paid trip to Europe seems like the ultimate graduation gift. However, college students who face thousands of dollars in academic debt may need to jump on the job hunt sooner than expected. With new financial responsibilities looming, recent grads will appreciate whatever help they can get. <br />
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To help soften the real world blow, here are 7 practical gifts that job-seeking college graduates will appreciate: <br />
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<strong><span style="color: #351c75;">Resume Service</span></strong> <br />
The first thing employers see is an applicant's resume and cover letter. Unfortunately, the style of these documents has become more complex in recent years. Graduates won't get noticed using the old method of simply listing experience by date. Cover letters are now approaching works of art, mentioning much more than that applicant is interested in the job and is a good team player, trustworthy and a hard worker. <br />
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A resume service will create updated documents so subsequent resumes and cover letters live up to modern standards. Costs run roughly $100 to $200, depending on the services you desire. It's worth paying extra to have an expert explain the latest tricks and how graduates can alter these documents for each job. Sites like <a href="http://www.resumemycareer.com/">ResumeMyCareer</a> can help you compile a professional and competitive resume at an affordable cost. <br />
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<strong><span style="color: #351c75;">Home Furnishings</span></strong><br />
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjtyNmgVtKWXEgID8LYLzj_xZjK-z_qHaKrC1XmqTsnsbgWv9pfwpWLD07qKLCX7i8ThiNaFVpotUuxwvjnuanFBFt5f_7cMgUxSohXTksI1Q99mUXUtG4inwpjrPwWwz0-puA8zaDMFAM/s1600/furniture.jpg" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"><img border="0" height="131" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjtyNmgVtKWXEgID8LYLzj_xZjK-z_qHaKrC1XmqTsnsbgWv9pfwpWLD07qKLCX7i8ThiNaFVpotUuxwvjnuanFBFt5f_7cMgUxSohXTksI1Q99mUXUtG4inwpjrPwWwz0-puA8zaDMFAM/s200/furniture.jpg" width="200" /></a><strong><span style="color: #351c75;"></span></strong><br />
After living with cinder-block bookshelves and saggy mattresses for four years or, worse yet, being surrounded by their childhood furniture while living at home, graduates might appreciate an upgrade on everything from a couch to kitchen implements especially those moving into a new apartment to be closer to their new 9 to 5 job. You might also put together a basket of upscale bed and bath products so the grad can finally dump their dollar-store shampoo and soap. <br />
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<strong><span style="color: #351c75;">Gift Cards</span></strong><br />
<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgccdoZD_6Xt03X153aP_Hs1Iaw4Ydjmj7Au64bWa6hDd_0h225xgx94E5QjdWi3jonyVDwKj8SxUtLyX7pMSMNnoF1ZYsMJ8XxK4ex0jHjSiqRvLmZ99W8VYhBdwvixbEwzAU-b5XAiHA/s1600/giftcard.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" height="171" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgccdoZD_6Xt03X153aP_Hs1Iaw4Ydjmj7Au64bWa6hDd_0h225xgx94E5QjdWi3jonyVDwKj8SxUtLyX7pMSMNnoF1ZYsMJ8XxK4ex0jHjSiqRvLmZ99W8VYhBdwvixbEwzAU-b5XAiHA/s200/giftcard.jpg" width="200" /></a></div><br />
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The 2011 crop of college graduates faces more debt than any other generation, so money is always a welcome gift, especially to help them get through that first, unstable post-school year. Grads not comfortable with the idea of asking directly for money can create a <a href="http://www.cardavenue.com/">gift card registry</a> at CardAvenue.com to receive gift cards from hundreds of merchants in a variety of categories from apparel to food, gas and much more. <br />
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<strong><span style="color: #351c75;">Job Interview Clothing</span></strong> <br />
Suits can be overkill in some places, unless the graduate lives in a big city or is looking for a management position. Most employers will expect something a bit more casual these days. Men should have a dress shirt, pants and shoes with a matching tie and, perhaps, a sports coat. Women will need a demure outfit of skirt and blouse or dress with basic pumps. A coordinated jacket would nicely complete the outfit.<br />
<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjtHRUaC0iWCMOl4iyww8dXZTpgTBZxSyYhTOu7uYnKY4XNLAcndjKpTT6uC79dmn9YI-W8RqjyHuvP-tkfYbDqhY-nc6uYDGUM8Km-AsdWA66PeNnQk5zJ5csWezvRLLeDydHALwceMJI/s1600/business+clothing.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="187" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjtHRUaC0iWCMOl4iyww8dXZTpgTBZxSyYhTOu7uYnKY4XNLAcndjKpTT6uC79dmn9YI-W8RqjyHuvP-tkfYbDqhY-nc6uYDGUM8Km-AsdWA66PeNnQk5zJ5csWezvRLLeDydHALwceMJI/s200/business+clothing.jpg" width="200" /></a></div><br />
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<strong><span style="color: #351c75;">Foreign Language Lessons</span></strong> <br />
College graduates face a tough job market and with high unemployment rates, that means more experienced competition. Given any opportunity to improve his or her skill set, grads can make themselves more marketable to potential employers depending on the position. Consider gifting Spanish lessons (Rosetta Stone is an effective and affordable option) or perhaps a GMAT review course for help towards MBA school admissions. <br />
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<strong><span style="color: #351c75;">Briefcase</span></strong><br />
<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEheXjghdURWXO0_dsgcyttYe1_3Yh1jKr1Ihpg3Qfkb1diqKVqFm_zrh9TgMe_XmRr8ywmruVMxVfCNc3bKoFPuvrw_Nf2q1ypHGB7KIxAmsd9aBif7HrKgvHlfYmeahUbNOaV9KAgghnU/s1600/briefcase.png" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" height="178" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEheXjghdURWXO0_dsgcyttYe1_3Yh1jKr1Ihpg3Qfkb1diqKVqFm_zrh9TgMe_XmRr8ywmruVMxVfCNc3bKoFPuvrw_Nf2q1ypHGB7KIxAmsd9aBif7HrKgvHlfYmeahUbNOaV9KAgghnU/s200/briefcase.png" width="200" /></a></div><br />
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Backpacks and messenger bags are great for toting books and water bottles, but grads will have a better chance of securing a job when they show up looking sophisticated. A soft-sided briefcase with room for a laptop, resume binder and lunch will give any job seeker a more professional appearance. <br />
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<strong><span style="color: #351c75;">Smartphone</span></strong><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiPzyM0azMi2t142NpvC-nkxVYNF0cmuIqBnzsp7dByt3evGpDfDVCN4RCwyu4AcKIVWPRT46A2jutssIR0xXAHYbXZ1NsRsemRrKec6-6xK70EC1Q82rYWgimyEyD3rNTd2V1Nk6j407k/s1600/droidx-motorolla.jpg" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"><img border="0" height="200" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiPzyM0azMi2t142NpvC-nkxVYNF0cmuIqBnzsp7dByt3evGpDfDVCN4RCwyu4AcKIVWPRT46A2jutssIR0xXAHYbXZ1NsRsemRrKec6-6xK70EC1Q82rYWgimyEyD3rNTd2V1Nk6j407k/s200/droidx-motorolla.jpg" width="116" /></a><strong><span style="color: #351c75;"></span></strong><br />
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With instant email access and GPS navigation, a smartphone will keep recent grads connected with potential employers and recruiters so they never miss an interview opportunity or an offer. Not to mention, the various apps that offer banking on-the-go, cheap dinner recipes and location-based drink specials to help make their lives a little easier.Angela Carterhttp://www.blogger.com/profile/12819817372215002169noreply@blogger.com1tag:blogger.com,1999:blog-2457150592733524440.post-13517542842127570532011-05-27T10:33:00.004-04:002011-06-10T09:32:30.237-04:00Inflation? I spit in your face!<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAnV3ZkJU0Np7RMzWQQh8TNCFJJep4wQ1xd9jQfqt8gcKdCrFPwVoL7QH3WV1qAaOBYmtuOJmDzXR_vKod6HMdyE_6NzHJ9vvNgprxNOEMrg70qBekXX5NMpAB_eaVB6JfbLLwOAaNdJc/s1600-h/PaulSchatz.jpg"><img alt="" border="0" id="BLOGGER_PHOTO_ID_5385080613162580258" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAnV3ZkJU0Np7RMzWQQh8TNCFJJep4wQ1xd9jQfqt8gcKdCrFPwVoL7QH3WV1qAaOBYmtuOJmDzXR_vKod6HMdyE_6NzHJ9vvNgprxNOEMrg70qBekXX5NMpAB_eaVB6JfbLLwOAaNdJc/s320/PaulSchatz.jpg" style="float: left; height: 320px; margin: 0px 10px 10px 0px; width: 258px;" /></a><em>(Editor's Note: Paul Schatz, President of Heritage Capital, LLC, in Woodbridge, will be contributing to Fi$callyFit every Friday. </em><a href="http://www.investfortomorrow.com/CallinShots.asp"><em>Read his biography here</em></a><em>)</em><br />
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<div style="margin: 0in 0in 0pt;"><span style="font-family: "Verdana", "sans-serif";"><span style="color: black;">Before I dive into today’s controversial topic, I want to say goodbye to one of the true pioneers in business television, Mark Haines from CNBC’s Squawk on the Street who passed away suddenly this week at the far too young age of 65. </span></span><br />
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<span style="font-family: "Verdana", "sans-serif";"><span style="color: black;">From his FNN days in LA to the CNBC merger to the host of Squawk Box to creating all of the popularly used on air nicknames to his final spot hosting from 9am to 11am, Mark Haines was the consummate professional.<span style="mso-spacerun: yes;"> </span></span></span></div><br />
<div style="margin: 0in 0in 0pt;"><span style="font-family: "Verdana", "sans-serif";"><span style="color: black;">Never shy or intimidated by a guest, Mark would not hesitate to challenge your view and force you to defend your position.<span style="mso-spacerun: yes;"> </span>With his unique eating habits and flair for the dramatic, Mark Haines was one of the faces of the network.<span style="mso-spacerun: yes;"> </span>You can Google some of his more interesting moments, like cutting his tie in half, donning an Army helmet during the Dotcom collapse and calling for a stock market bottom in March 2009.<span style="mso-spacerun: yes;"> </span></span></span></div><br />
<div style="margin: 0in 0in 0pt;"><span style="font-family: "Verdana", "sans-serif";"><span style="color: black;">When I started marketing to the media to build my profile in the mid 1990s, one of my long-term goals was to be interviewed as the stock market opened by Mark Haines.<span style="mso-spacerun: yes;"> </span>Thankfully, I achieved that goal several years ago and have enjoyed every interview with Mark ever since, especially the one where he challenged my view about using different analysis in deflationary times than inflationary times.<span style="mso-spacerun: yes;"> </span></span></span></div><br />
<div style="margin: 0in 0in 0pt;"><span style="font-family: "Verdana", "sans-serif";"><span style="color: black;">I never met Mark Haines in person, but he is someone who has been part of my business life for decades and will be sorely missed.<span style="mso-spacerun: yes;"> </span>May he rest in peace…</span></span></div><br />
<span style="font-family: "Verdana", "sans-serif";"><span style="color: black;">And now to the topic at hand.<span style="mso-spacerun: yes;"> </span>With so much attention paid to commodity inflation lately, I thought a good item to discuss inflation in general.<span style="mso-spacerun: yes;"> </span></span></span><br />
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<span style="font-family: "Verdana", "sans-serif";"><span style="color: black;">Longtime readers have known that since 2007, I have been in the deflation camp, not believing for a minute that serious, structural and systemic inflation was anywhere in our immediate future.<span style="mso-spacerun: yes;"> </span>And I still share that view today.<span style="mso-spacerun: yes;"> </span>Comparing this period to that of the 1970s, or Argentina, Zimbabwe or the Weimar Republic is just plain absurd in my opinion. </span></span><br />
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<div style="margin: 0in 0in 0pt;"><span style="font-family: "Verdana", "sans-serif";"><span style="color: black;">YES, we have commodity inflation.<span style="mso-spacerun: yes;"> </span>I agree!<span style="mso-spacerun: yes;"> </span>But I side with Ben Bernanke that it is more transitory than structural.<span style="mso-spacerun: yes;"> </span>Real inflationary problems usually have certain DNA markers, such as money velocity in the financial system.<span style="mso-spacerun: yes;"> </span>Essentially, that means banks take in money and create many, many more dollars from that single dollar.<span style="mso-spacerun: yes;"> </span>Today, we still see record amount of cash held at the Fed on behalf of the banks.<span style="mso-spacerun: yes;"> </span>Add to that, more than $1T on corporate balance sheets and you can easily conclude that companies are in no rush to deploy their capital.<span style="mso-spacerun: yes;"> </span>In other words, a dollar is worth more tomorrow than it is today.<span style="mso-spacerun: yes;"> </span>That’s the opposite of inflation where a buck is worth more today than tomorrow!</span></span></div><br />
<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEigS39ZuHWM_miTM-_1-iKJ9AJczLQ6bbicrLfUYmV22kII7HyaWj0i-okAluZKshiajI4lL9S_j2Q3s-RtE_SPQpniXT4oMYq6Lp8R7KbFwoMHL7lML9EzJw0pRqcw9bmUcQyACabK7RA/s1600/M1_Velocity2.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="384" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEigS39ZuHWM_miTM-_1-iKJ9AJczLQ6bbicrLfUYmV22kII7HyaWj0i-okAluZKshiajI4lL9S_j2Q3s-RtE_SPQpniXT4oMYq6Lp8R7KbFwoMHL7lML9EzJw0pRqcw9bmUcQyACabK7RA/s640/M1_Velocity2.jpg" width="640" /></a></div><br />
<div class="separator" style="clear: both; text-align: justify;"><span style="color: #000099; font-family: "Verdana", "sans-serif";"><span style="color: black;">Other systemic items include capacity utilization.<span style="mso-spacerun: yes;"> </span>While those numbers have climbed from almost depressionary levels below 70, they are nowhere near the 85%+ that would be worrisome as you can see from the St. Louis Fed graph below.</span><span style="mso-spacerun: yes;"> </span></span></div><br />
<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgEe1udqqnPoLGY3JOpeKFdF4o_hXlDY-6vnNx4l0EscYOEkLVlq96bVM4qdlsjE4lZAyj7535owI5D-HsF_fp63FP_7Gq3tRn1TBnxfkSKwiY06VMNk4TxaI5SJJpiKXjv5XhlLg6w6Cc/s1600/Cap+U.bmp" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="384" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgEe1udqqnPoLGY3JOpeKFdF4o_hXlDY-6vnNx4l0EscYOEkLVlq96bVM4qdlsjE4lZAyj7535owI5D-HsF_fp63FP_7Gq3tRn1TBnxfkSKwiY06VMNk4TxaI5SJJpiKXjv5XhlLg6w6Cc/s640/Cap+U.bmp" width="640" /></a></div><br />
<div style="margin: 0in 0in 0pt;"><span style="color: #000099; font-family: "Verdana", "sans-serif";"><span style="color: black;">Look out of your window at the housing and job market.<span style="mso-spacerun: yes;"> </span>With housing stable at best and the average person’s largest asset, you would be hard pressed to offer that there is even the slightest of inflation here.<span style="mso-spacerun: yes;"> </span>And the employment picture, while much better than in the heat of the crisis, continues to show more than 9% of the workforce unemployed, 10% if you trust the Gallup poll below.</span><span style="mso-spacerun: yes;"> </span></span><br />
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</div><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgy0Y8rBEu0J8v_BA0zry8IWlSEceZ5oDCa-Of4mbwymO0IASd9rCyV4CQ0rMoPuj7PCpwLZd1lV5-DxWSlwMy08rZp7RBOaC8hLyVoY78Qg5r6LuscFggZOezLqFZf_5Z7VmIPA77J7AY/s1600/Gallup+Rate.gif" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="380" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgy0Y8rBEu0J8v_BA0zry8IWlSEceZ5oDCa-Of4mbwymO0IASd9rCyV4CQ0rMoPuj7PCpwLZd1lV5-DxWSlwMy08rZp7RBOaC8hLyVoY78Qg5r6LuscFggZOezLqFZf_5Z7VmIPA77J7AY/s640/Gallup+Rate.gif" width="640" /></a></div><br />
<span style="font-family: "Verdana", "sans-serif";"><span style="color: black;">But digging a little deeper, the “real” unemployment rate, taking into account the underemployed and discouraged (U6) is almost 20%, according to Gallup.<span style="mso-spacerun: yes;"> </span>I am not sure anyone can use this data to support the inflation argument.</span></span><br />
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<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjpxagjRY99Sn7-pfknMuhTyp5GObhwjhIMoXyinK5lOCDZf1uLkw3wCokPd3llZX-sdzEsGh14aws2b_9w0OVFLD-kbtw4-m5PyqpmJ4wSL3QZJDdIo4zz61psnvJ3YjHKynx1vWBaSMU/s1600/Gallup+U6.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="390" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjpxagjRY99Sn7-pfknMuhTyp5GObhwjhIMoXyinK5lOCDZf1uLkw3wCokPd3llZX-sdzEsGh14aws2b_9w0OVFLD-kbtw4-m5PyqpmJ4wSL3QZJDdIo4zz61psnvJ3YjHKynx1vWBaSMU/s640/Gallup+U6.jpg" width="640" /></a></div><br />
<span style="color: black;"><span style="color: #000099; font-family: "Verdana", "sans-serif";"><span style="color: black;">Turning to one of the most important measures of systemic inflation, wages and wage growth, you can see below further evidence that supports my thesis that structural inflation is not a problem.<span style="mso-spacerun: yes;"> </span>Think about what happens when everyone makes more money than last year and the year before.<span style="mso-spacerun: yes;"> </span>Most people spend it!<span style="mso-spacerun: yes;"> </span>More dollars chasing the same number of goods and services.<span style="mso-spacerun: yes;"> </span>So prices rise.<span style="mso-spacerun: yes;"> </span>When wages fall or stay flat, like they have most of the past 11 years, you have fewer or the same dollars chasing the same number of goods and services.<span style="mso-spacerun: yes;"> </span>Prices stay flat or fall</span>.</span></span><br />
<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEin92AMxw2k3cEMTrKhfY7Vdij98x416h29NrgW9y-gzLWEG4ytECjv0I63d2S4Wcy5j0a1gb1oC9P5xhL-T4mBbeNswOayuzq5aT3x78pOYS1gEMLbX3x19ggyIoMWVmX-0nHuwy7pZIU/s1600/wages.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="522" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEin92AMxw2k3cEMTrKhfY7Vdij98x416h29NrgW9y-gzLWEG4ytECjv0I63d2S4Wcy5j0a1gb1oC9P5xhL-T4mBbeNswOayuzq5aT3x78pOYS1gEMLbX3x19ggyIoMWVmX-0nHuwy7pZIU/s640/wages.jpg" width="640" /></a></div><br />
<span style="color: #000099; font-family: "Verdana", "sans-serif";"><span style="color: black;">Remember, inflation is measured by price changes on year over year basis.<span style="mso-spacerun: yes;"> </span>If oil goes up 100% in 2011 and remains at that same level in 2012, inflation is actually 0% in 2012 even though prices are high.<span style="mso-spacerun: yes;"> </span>It’s the year over year change that signals inflation.</span></span><br />
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<div style="margin: 0in 0in 0pt;"><span style="color: #000099; font-family: "Verdana", "sans-serif";"><span style="color: black;">In the end, while it is painful at the pump and at the grocery store, I do not believe that consumer commodity inflation is here to stay and will be a long-term, systemic problem. </span></span></div><span style="color: black;"></span><br />
<div style="margin: 0in 0in 0pt;"><span style="color: navy; font-family: "Verdana", "sans-serif";"><span style="color: black;">FYI, I will be on CNBC’s Squawk on the Street at 9:35am on May 31.</span></span></div><span style="color: black;"></span><br />
<div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><span style="color: black;">Feel free to email me with any questions or comments at </span><a href="mailto:Paul@investfortomorrow.com"><span style="color: #002060;"><span style="color: black;">Paul@investfortomorrow.com</span></span></a><span style="color: black;">.</span></span></div><span style="color: black;"></span><br />
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<div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><span style="color: black;">Until next time…</span></span></div><span style="color: black;"><span style="color: #002060; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"></span></span><br />
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<div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><span style="color: black;">Paul Schatz</span></span></div><span style="color: black;"></span><br />
<div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><span style="color: black;">Heritage Capital LLC</span></span></div><span style="color: black;"></span><br />
<div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><a href="http://www.investfortomorrow.com/"><span style="color: #002060;"><span style="color: black;">http://www.InvestForTomorrow.com</span></span></a></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><a href="http://retirementplanningconnecticut.com/"><span style="color: #002060;"><span style="color: black;">http://RetirementPlanningConnecticut.com/</span></span></a></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><br />
</div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana", "sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><span style="color: black;">Follow us on Facebook at </span><a href="http://www.facebook.com/heritagecapital"><span style="color: #002060;"><span style="color: black;">www.facebook.com/heritagecapital</span></span></a><span style="color: black;"> and on Twitter @Paul_Schatz</span></span></div>Angela Carterhttp://www.blogger.com/profile/12819817372215002169noreply@blogger.com1tag:blogger.com,1999:blog-2457150592733524440.post-79404821435351151442011-05-26T15:30:00.000-04:002011-05-26T15:30:04.981-04:00New Haven woman sentenced to 30 months for bank robberyNEW HAVEN - David Fein, U.S. States Attorney for the District of Connecticut, announced today that Marta Lozada, 43, of New Haven, was sentenced today by U.S.District Judge Janet C. Hall in Bridgeport to 30 months in prison, followed by three years of supervised release, for bank robbery. <br />
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Hall also ordered Lozada to reside in a halfway house during the first 6 months of her term of supervised release.<br />
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According to court documents and statements made in court, on February 4, 2010, Lozada robbed a Bank of America branch at 100 Amity Road. She took $4,858, records show.Angela Carterhttp://www.blogger.com/profile/12819817372215002169noreply@blogger.com0tag:blogger.com,1999:blog-2457150592733524440.post-20321682109716046892011-05-20T11:00:00.002-04:002011-05-27T09:06:49.269-04:00Silver at the Fork in the Road<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAnV3ZkJU0Np7RMzWQQh8TNCFJJep4wQ1xd9jQfqt8gcKdCrFPwVoL7QH3WV1qAaOBYmtuOJmDzXR_vKod6HMdyE_6NzHJ9vvNgprxNOEMrg70qBekXX5NMpAB_eaVB6JfbLLwOAaNdJc/s1600-h/PaulSchatz.jpg"><img alt="" border="0" id="BLOGGER_PHOTO_ID_5385080613162580258" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAnV3ZkJU0Np7RMzWQQh8TNCFJJep4wQ1xd9jQfqt8gcKdCrFPwVoL7QH3WV1qAaOBYmtuOJmDzXR_vKod6HMdyE_6NzHJ9vvNgprxNOEMrg70qBekXX5NMpAB_eaVB6JfbLLwOAaNdJc/s320/PaulSchatz.jpg" style="float: left; height: 320px; margin: 0px 10px 10px 0px; width: 258px;" /></a><em></em><br />
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<em>(Editor's Note: Paul Schatz, President of Heritage Capital, LLC, in Woodbridge, will be contributing to Fi$callyFit every Friday. </em><a href="http://www.investfortomorrow.com/CallinShots.asp"><em>Read his biography here</em></a><em>)</em><br />
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<u>I</u><a href="http://www.blogger.com/goog_992985496" name="LETTER.BLOCK16"><span style="color: #000099; font-family: "Verdana","sans-serif";"><span style="color: black;">n the </span></span></a><span style="color: #000099; font-family: "Verdana","sans-serif";"><a href="http://www.investfortomorrow.com/news.asp" target="_blank"><span style="color: black;">past few issues</span></a><span style="color: black;"> of my Street$marts letter and on Facebook and Twitter, silver has been a popular topic.</span></span><br />
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<span style="color: #000099; font-family: "Verdana","sans-serif";"><span style="color: black;"> If you are not following my daily comments and would like to, please click on the Facebook and/or Twitter icons at the bottom of this post. When we left silver not long ago, I showed a series of charts on how bubbles are built and what they look like. </span></span><br />
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<span style="color: #000099; font-family: "Verdana","sans-serif";"><span style="color: black;">I also explained why they are so difficult to profit from, using Keynes' line that the market can stay irrational longer than you can stay solvent. <o:p></o:p></span></span><br />
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<div style="margin: 0in 0in 0pt;"><span style="color: #000099; font-family: "Verdana","sans-serif";"><span style="color: black;">From the 2008 bottom. $9 to $50. What do you think? Bubble?</span></span></div><div style="margin: 0in 0in 0pt;"></div><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgABuDdv4Ee3JSNeHD1-l0NGejQDa5zIaLtJR0A_DpFe4_Tbw-G_cypB-3gxiHvlZb1Q7NSpsRqneWvHSqXJyT0e_ISjlr4fEtY5bE3nIOG6f-be3XeFRPHi2bO-0nxvNsOl14uhiB3Vas/s1600/silverbubble+jpg.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="277" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgABuDdv4Ee3JSNeHD1-l0NGejQDa5zIaLtJR0A_DpFe4_Tbw-G_cypB-3gxiHvlZb1Q7NSpsRqneWvHSqXJyT0e_ISjlr4fEtY5bE3nIOG6f-be3XeFRPHi2bO-0nxvNsOl14uhiB3Vas/s400/silverbubble+jpg.jpg" width="400" /></a></div><div style="margin: 0in 0in 0pt;"></div><div style="margin: 0in 0in 0pt;"><span style="color: #000099; font-family: "Verdana","sans-serif";"><span style="color: black;">Today, we can easily see below that silver was decimated from $50 to $33 in a little more than a week. Has the bull market ended? Is silver headed back to single digits? It's still too early to tell, but the bull market has been seriously wounded.</span> </span></div><div style="margin: 0in 0in 0pt;"><span style="color: black; font-family: Times New Roman;"> </span></div><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj0DwVcQmAwLSE67sNyx9v_SB-f0FRgGF58Pj5QA-uH_y8p0NZA3o-p5_f3UUTugl_HQ3dUyxlmjas5Rfa0G7Z2e3MsE0LJPkMSrY47X88xJi2NuM1YI7Ia9hLQOtFGKtnPkYl4QAvgGgc/s1600/silverburst+5-19.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="277" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj0DwVcQmAwLSE67sNyx9v_SB-f0FRgGF58Pj5QA-uH_y8p0NZA3o-p5_f3UUTugl_HQ3dUyxlmjas5Rfa0G7Z2e3MsE0LJPkMSrY47X88xJi2NuM1YI7Ia9hLQOtFGKtnPkYl4QAvgGgc/s400/silverburst+5-19.jpg" width="400" /></a></div><div style="margin: 0in 0in 0pt;"></div><div style="margin: 0in 0in 0pt;"><br />
<span style="color: #000099; font-family: "Verdana","sans-serif";"><span style="color: black;">It was certainly a back breaker for the bulls as the Chicago Merc, where silver trades, repeatedly raised margin requirements to help put a damper on rampant speculation. And contrary to popular belief, there is no anecdotal evidence that raising margin requirements on commodities causes prices to decline.<span style="mso-spacerun: yes;"> </span>Volume certainly slows and perhaps volatility recedes, but price is like water.<span style="mso-spacerun: yes;"> </span>It finds its own level.<span style="mso-spacerun: yes;"> </span><o:p></o:p></span></span></div><div style="margin: 0in 0in 0pt;"><span style="color: black; font-family: Times New Roman;"> </span></div><div style="margin: 0in 0in 0pt;"><span style="color: #000099; font-family: "Verdana","sans-serif";"><span style="color: black;">Conspiracy theorists are out in full force, believing that this is all part of a grand scheme by the government to confiscate gold and silver holdings of American citizens like FDR did in 1934. If that's even remotely true, why wasn't the margin requirement on gold raised as well? What a far cry from a few weeks ago when that same group (or not) continued reporting that JP Morgan was short the equivalent of all the silver on earth and they were being squeezed to deliver the metal. You can't have it both ways!<o:p></o:p></span></span></div><div style="margin: 0in 0in 0pt;"><span style="color: black; font-family: Times New Roman;"> </span></div><div style="margin: 0in 0in 0pt;"><span style="color: #000099; font-family: "Verdana","sans-serif";"><span style="color: black;">As a student of market history, it's helpful to be able to compare current action with that of a similar period in the past. The next chart is from 2006 and shows a similar collapse in silver after a meteoric rise.</span></span></div><div style="margin: 0in 0in 0pt;"><span style="color: black; font-family: Times New Roman;"> </span><span style="color: #000099; font-family: "Verdana","sans-serif";"> <o:p></o:p></span></div><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiwog6C1fdeLWFUR9RqkOVWxaSzTLRpzBpsHZeXcXJPLEJZg0brAPOoiuYI5KE0g6OfOedwqpssz18d9vsueEKxC6iRSWqUBikhtfCW8u06bck8CyfEy6M49dc56UJxpXGnAQlczq6McFo/s1600/silver+2006+jpg.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="277" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiwog6C1fdeLWFUR9RqkOVWxaSzTLRpzBpsHZeXcXJPLEJZg0brAPOoiuYI5KE0g6OfOedwqpssz18d9vsueEKxC6iRSWqUBikhtfCW8u06bck8CyfEy6M49dc56UJxpXGnAQlczq6McFo/s400/silver+2006+jpg.jpg" width="400" /></a></div><div style="margin: 0in 0in 0pt;"><span style="color: black; font-family: Times New Roman;"> </span></div><span style="color: black; font-family: Times New Roman;"><span style="color: #000099; font-family: "Verdana","sans-serif";"><span style="color: black;">At that time, I remember believing that the gig was up and silver was toast for a long while. How wrong I was as the metal digested for more than a year before blowing off to the upside in early 2008.<o:p></o:p></span></span></span><br />
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<span style="color: black; font-family: Times New Roman;"><div style="margin: 0in 0in 0pt;"></div><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg2WwYhQtAnLgKoJ5MF6nFhj2cw_toWdf2mRSeW13wzB7O3qpGP_TkUT8nQMjmITQFGoKZhjZEskTAb9lsyKT3FfC_JLt8xSAgv45IdlZONd9JbaNVIxLTPBBSMxovc1RNY3PzY-4NPKCM/s1600/silver+2006-2008+jpg.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="277" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg2WwYhQtAnLgKoJ5MF6nFhj2cw_toWdf2mRSeW13wzB7O3qpGP_TkUT8nQMjmITQFGoKZhjZEskTAb9lsyKT3FfC_JLt8xSAgv45IdlZONd9JbaNVIxLTPBBSMxovc1RNY3PzY-4NPKCM/s400/silver+2006-2008+jpg.jpg" width="400" /></a></div><div style="margin: 0in 0in 0pt;"></div></span><br />
<div style="margin: 0in 0in 0pt;"><span style="font-family: Times New Roman;"><span style="color: black; font-family: "Verdana","sans-serif";">I think the best way to ascertain where silver is now is to see how it behaves in the coming weeks. After a 34% hit, buyers should support the metal between here and $30. If we begin to see stability and digestion, I will argue that the bull market is not over. However, if we see more selling, especially into rallies that result in lower lows, I think the bull market will be dead as you can see the two possible paths below.<span style="mso-spacerun: yes;"> </span>The red arrows indicate that a new bear market began and the greens ones indicate a multi month digestion before taking off to the upside again above $50.</span></span><span style="color: black; font-family: Times New Roman;"> </span><span style="color: black; font-family: Times New Roman;"><br />
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<span style="color: black; font-family: Times New Roman;"><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgSHVkvLTCvS5axXHUqcr7xLhDko2ywY3LVvjWX4MoYqAoiQ3fVnMzxcTn-z-eas2GV3FPIx30mL1Rw6RpGhD_L0GA6ezLLd9ZAYol-JIGt9xhqOtaQnp_U20WLCmMsjJtAUMzeO7YDohw/s1600/silver+5-20+2+jpg.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="277" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgSHVkvLTCvS5axXHUqcr7xLhDko2ywY3LVvjWX4MoYqAoiQ3fVnMzxcTn-z-eas2GV3FPIx30mL1Rw6RpGhD_L0GA6ezLLd9ZAYol-JIGt9xhqOtaQnp_U20WLCmMsjJtAUMzeO7YDohw/s400/silver+5-20+2+jpg.jpg" width="400" /></a></div><div style="margin: 0in 0in 0pt;"><br />
</div><div style="margin: 0in 0in 0pt;"><span style="color: #000099; font-family: "Verdana","sans-serif";"></span> <span style="color: navy; font-family: "Verdana","sans-serif";"><span style="color: black;">FYI, I will be on CNBC’s Squawk on the Street at 9:35am on May 31.<o:p></o:p></span></span></div><div style="margin: 0in 0in 0pt;"><span style="color: black; font-family: Times New Roman;"> </span></div><div style="margin: 0in 0in 0pt;"><span style="color: black; font-family: Times New Roman;"> </span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><span style="color: black;">Feel free to email me with any questions or comments at </span><a href="mailto:Paul@investfortomorrow.com"><span style="color: #002060;"><span style="color: black;">Paul@investfortomorrow.com</span></span></a><span style="color: black;">.<o:p></o:p></span></span></div><div style="margin: 0in 0in 0pt;"><span style="color: black; font-family: Times New Roman;"> </span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><br />
</div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><span style="color: black;">Until next time…<o:p></o:p></span></span></div><div style="margin: 0in 0in 0pt;"><span style="color: black; font-family: Times New Roman;"> </span><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><o:p><span style="font-family: Times New Roman;"> </span></o:p></span></div><div style="margin: 0in 0in 0pt;"><span style="color: black; font-family: Times New Roman;"> </span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;">Paul Schatz<o:p></o:p></span></div><div style="margin: 0in 0in 0pt;"><span style="color: black; font-family: Times New Roman;"> </span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;">Heritage Capital LLC</span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><a href="http://www.investfortomorrow.com/"><span style="color: #002060;">http://www.InvestForTomorrow.com</span></a> </span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><a href="http://retirementplanningconnecticut.com/"><span style="color: #002060;">http://RetirementPlanningConnecticut.com/</span></a></span><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><o:p><span style="font-family: Times New Roman;"> </span></o:p></span></div><div style="margin: 0in 0in 0pt;"><span style="color: black; font-family: Times New Roman;"> </span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;">Follow us on Facebook at <a href="http://www.facebook.com/heritagecapital"><span style="color: #002060;">www.facebook.com/heritagecapital</span></a> and on Twitter @Paul_Schatz</span></div></span><br />
<div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"></div>Angela Carterhttp://www.blogger.com/profile/12819817372215002169noreply@blogger.com0tag:blogger.com,1999:blog-2457150592733524440.post-34129550606309705472011-05-13T19:00:00.003-04:002011-05-20T10:51:14.213-04:00Storm Clouds on the Horizon<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAnV3ZkJU0Np7RMzWQQh8TNCFJJep4wQ1xd9jQfqt8gcKdCrFPwVoL7QH3WV1qAaOBYmtuOJmDzXR_vKod6HMdyE_6NzHJ9vvNgprxNOEMrg70qBekXX5NMpAB_eaVB6JfbLLwOAaNdJc/s1600-h/PaulSchatz.jpg"><img alt="" border="0" id="BLOGGER_PHOTO_ID_5385080613162580258" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAnV3ZkJU0Np7RMzWQQh8TNCFJJep4wQ1xd9jQfqt8gcKdCrFPwVoL7QH3WV1qAaOBYmtuOJmDzXR_vKod6HMdyE_6NzHJ9vvNgprxNOEMrg70qBekXX5NMpAB_eaVB6JfbLLwOAaNdJc/s320/PaulSchatz.jpg" style="float: left; height: 320px; margin: 0px 10px 10px 0px; width: 258px;" /></a><em></em><br />
<em>(Editor's Note: Paul Schatz, President of Heritage Capital, LLC, in Woodbridge, will be contributing to Fi$callyFit every Friday. </em><a href="http://www.investfortomorrow.com/CallinShots.asp"><em>Read his biography here</em></a><em>)</em><br />
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<div style="margin: 0in 0in 0pt;"><span style="color: navy; font-family: "Verdana","sans-serif";"><span style="color: black;">Below is a familiar chart of the S&P 500 showing the various 4-8% pullbacks we continue to see. As I write this, the stock market is rolling over to the downside and it certainly has the feel of wanting to sell off more in the coming days. </span></span><br />
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<span style="color: navy; font-family: "Verdana","sans-serif";"><span style="color: black;">Rallies are getting shorter and choppier.<span style="mso-spacerun: yes;"> </span>If we do see more weakness, my initial take can be seen in blue and calls for a move below last week's low before resuming the rally.<o:p></o:p></span></span></div><span style="color: black;"> </span><br />
<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi8lUNf8bRRa2ADtIbxBpFpVUEd0um50Q-xBzbxWACljYujg-xViZpJoyovCZU8XpDClUDVcf13i_GRjsketpZQHCtsv0coSPndD5AlnQgayQtjukjikYMJT-mdGkdDnRC9tv-xVJPbFWI/s1600/sp511+blog.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="277" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi8lUNf8bRRa2ADtIbxBpFpVUEd0um50Q-xBzbxWACljYujg-xViZpJoyovCZU8XpDClUDVcf13i_GRjsketpZQHCtsv0coSPndD5AlnQgayQtjukjikYMJT-mdGkdDnRC9tv-xVJPbFWI/s400/sp511+blog.jpg" width="400" /></a></div><br />
<div style="margin: 0in 0in 0pt;"><span style="color: navy; font-family: "Verdana","sans-serif";"><span style="color: black;">Until proven otherwise, I believe this is just another 4-8% cleanse before moving higher. HOWEVER, as I have written about before here and included in my </span><a href="http://www.investfortomorrow.com/2011Forecast.asp" target="_blank"><span style="color: black;">2011 Forecast</span></a><span style="color: black;">, I do not believe 2011 ends up hugely in the black. I think we "borrowed" some of that upside last year. <o:p></o:p></span></span></div><span style="color: black;"> </span><br />
<div style="margin: 0in 0in 0pt;"><span style="color: navy; font-family: "Verdana","sans-serif";"><span style="color: black;">My concerns now are growing, given that this entire bull market has been surfing a tidal wave of liquidity and the Fed is firm that the torrent will be turned off on June 30. Do I hear QE3?!?! I have serious questions whether the economy and markets can stand on their own two feet without major help (government assistance).<span style="mso-spacerun: yes;"> </span><o:p></o:p></span></span></div><span style="color: black;"> </span><br />
<div style="margin: 0in 0in 0pt;"><span style="color: navy; font-family: "Verdana","sans-serif";"><span style="color: black;">I hope and pray Bernanke heeds the lesson learned in 1937 after the Dow rallied 400% from the 1932 low and all was sanguine in the economy and markets.<span style="mso-spacerun: yes;"> </span>Back then, the government pulled fiscal stimuli, taxes were increased and interest rates were raised.<span style="mso-spacerun: yes;"> </span>Most people forget that the Great Depression Part II began with a surge in unemployment and a collapsing stock market.<span style="mso-spacerun: yes;"> </span>Only a shift to a wartime economy after Pearl Harbor did the U.S. begin the real recovery.<o:p></o:p></span></span></div><span style="color: black;"> </span><br />
<div style="margin: 0in 0in 0pt;"><span style="color: navy; font-family: "Verdana","sans-serif";"><span style="color: black;">Last spring, as you can see below, we saw what happened when the Fed stopped pumping money into the system. Of course, Greece and the Flash Crash had something to do with it!<o:p></o:p></span></span></div><span style="color: black;"> </span><br />
<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEipNziXQRH_kCxWuJseDWqDDNsRMMEEqLm6S3ieW6Ok6DMgUijQf55XpSbrURUqLQdiAtUWNScOIf3kAN5rq35ndwDzsp7JBYplOaKTG4fBaF5r1F-zRGQj1J-9OJXiVnCzfaqn-7jbfEI/s1600/spcorrectionblog.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="276" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEipNziXQRH_kCxWuJseDWqDDNsRMMEEqLm6S3ieW6Ok6DMgUijQf55XpSbrURUqLQdiAtUWNScOIf3kAN5rq35ndwDzsp7JBYplOaKTG4fBaF5r1F-zRGQj1J-9OJXiVnCzfaqn-7jbfEI/s400/spcorrectionblog.jpg" width="400" /></a></div><br />
<div style="margin: 0in 0in 0pt;"><span style="color: navy; font-family: "Verdana","sans-serif";"><span style="color: black;">IF the stock market is in the process of building a peak this quarter, I think volatility will continue to increase through the end of June. We should see fewer and fewer stocks in healthy shape and more than a few key market sectors not behave well during rallies. I would also imagine that junk bonds and/or small caps would start to underperform, given how sensitive they are to liquidity. In turn, that would set the stage for some unpleasantness (10-20% correction) during the third quarter.<o:p></o:p></span></span></div><span style="color: black;"> </span><br />
<div style="margin: 0in 0in 0pt;"><span style="color: navy; font-family: "Verdana","sans-serif";"><span style="color: black;">Arguing against this theme is the fact that this is the third year of Obama's term, the strongest of the four year cycle where we have only seen one down year in the past 70-ish years. But as I mentioned already, I think the market borrowed some of the rally last year, which should have been a poor year according to the presidential cycle. <o:p></o:p></span></span></div><span style="color: black;"> </span><br />
<div style="margin: 0in 0in 0pt;"><span style="color: navy; font-family: "Verdana","sans-serif";"><span style="color: black;">In short, I am not ready to jump ship just yet. We are dancing close to the door, but I think there should still be some more upside after this little pullback exhausts itself in the coming week or two.<o:p></o:p></span></span></div><span style="color: black;"> </span><br />
<div style="margin: 0in 0in 0pt;"><span style="color: navy; font-family: "Verdana","sans-serif";"><span style="color: black;">FYI, I will be on CNBC’s Worldwide Exchange from 5:30am to 5:50am on May 17.<o:p></o:p></span></span></div><span style="color: black;"> </span><span style="color: navy; font-family: "Verdana","sans-serif";"><span style="color: black;"> <o:p></o:p></span></span><br />
<span style="color: black;"> </span><br />
<div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><span style="color: black;">Feel free to email me with any questions or comments at </span><a href="mailto:Paul@investfortomorrow.com"><span style="color: #002060;"><span style="color: black;">Paul@investfortomorrow.com</span></span></a><span style="color: black;">.<o:p></o:p></span></span></div><span style="color: black;"> </span><br />
<div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><span style="color: black;">Until next time…<o:p></o:p></span></span></div><span style="color: black;"> </span><br />
<span style="color: black;"> </span><br />
<div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><span style="color: black;">Paul Schatz<o:p></o:p></span></span></div><span style="color: black;"> </span><br />
<div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><span style="color: black;">Heritage Capital LLC<o:p></o:p></span></span></div><span style="color: black;"> </span><br />
<div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><a href="http://www.investfortomorrow.com/"><span style="color: #002060;"><span style="color: black;">http://www.InvestForTomorrow.com</span></span></a></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><a href="http://retirementplanningconnecticut.com/"><span style="color: #002060;"><span style="color: black;">http://RetirementPlanningConnecticut.com/</span></span></a></span><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><o:p><span style="color: black; font-family: Times New Roman;"> </span></o:p></span></div><span style="color: black;"> </span><br />
<div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><span style="color: black;">Follow us on Facebook at </span><a href="http://www.facebook.com/heritagecapital"><span style="color: #002060;"><span style="color: black;">www.facebook.com/heritagecapital</span></span></a><span style="color: black;"> and on Twitter at Paul_Schatz</span></span></div>Angela Carterhttp://www.blogger.com/profile/12819817372215002169noreply@blogger.com0tag:blogger.com,1999:blog-2457150592733524440.post-47867905552498388192011-05-10T15:50:00.000-04:002011-05-10T15:50:06.173-04:00Pew researchers: Interest rates stabilizing 2 years after CARD Act<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhBp5ASQRj0qIOFKDI4oLJt9TW0skRYHhlL0q-te-S8T0Wqea-1d9LwdVWA4OIbAa6BEipOFvOrH027c3FED0pq-4Z98lg79jlAPEl4pJQr-YlXYOA3zy_JlN1OwoTeJa5m4vutYUO00PM/s1600/creditcards.jpg" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"><img border="0" height="212" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhBp5ASQRj0qIOFKDI4oLJt9TW0skRYHhlL0q-te-S8T0Wqea-1d9LwdVWA4OIbAa6BEipOFvOrH027c3FED0pq-4Z98lg79jlAPEl4pJQr-YlXYOA3zy_JlN1OwoTeJa5m4vutYUO00PM/s320/creditcards.jpg" width="320" /></a></div>Contrary to predictions, credit card holders are seeing stabilized interest rates, the elimination of over-the-limit penalty charges, a reduction in late fees charged by banks and minimal changes in annual fees since the landmark Credit Card Accountability, Responsibility and Disclosure (CARD) Act of 2009 took effect, according to new research by the <a href="http://www.pewtrusts.org/">Pew Health Group’s Safe Credit Cards Project</a>.<br />
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Pew data show that the median advertised interest rates for purchases on bank credit cards remained unchanged from 2010. Meanwhile, bank cash advance and penalty rates held firm. Additionally, the percentage of cards with annual fees held steady for credit unions at 14% and increased for banks from 14% in 2010 to 21% in 2011. The amount charged for annual fees remained unchanged.<br />
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"Pew’s research shows that predictions that the legislation would spark new charges and long-term interest rate growth have not materialized," said Nick Bourke, director of Pew’s Safe Credit Cards Project.<br />
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"Whatever increases in advertised interest rates we saw going into 2010 have not continued into 2011. The act created a new equilibrium where interest rates have flattened, penalty charges have declined and a number of practices deemed 'unfair or deceptive' have disappeared. Consumers are enjoying safer, more transparently priced credit cards - and banks and credit unions are able to compete on a more level playing field," he said.<br />
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The study, <em><a href="http://www.pewtrusts.org/uploadedFiles/wwwpewtrustsorg/Reports/Credit_Cards/Report_Equilibrium_web.pdf">"A New Equilibrium: After Passage of Landmark Credit Card Reform, Interest Rates and Fees Have Stabilized,"</a></em> is the latest in a series of reports from the Pew Safe Credit Cards Project that has examined all consumer credit cards offered online by the nation’s 12 largest bank and 12 largest credit union issuers.<br />
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Together, these institutions control more than 90% of the nation’s outstanding credit card debt. <br />
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One caveat the study doesn’t address, however, is that most credit cards now carry variable rates, so if the prime rate starts to rise, that would lead to consumers paying higher rates on their cards. <br />
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Here are the key findings:<br />
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<strong><u><span style="color: #990000;">Interest rates have stabilized.</span></u></strong><br />
Median advertised interest rates for purchases on bank-issued credit cards held steady at 12.99 to 20.99%. Likewise, bank cash advance and penalty interest rates remained unchanged from 2010 to 2011. During that same period, median credit union purchase rates slightly increased and cash advance rates declined.<br />
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<strong><u><span style="color: #990000;">Penalties cost less.</span></u></strong><br />
Since the enactment of the legislation, over-the-limit penalty fees have all but vanished. Only 11% of bank credit cards now include them, while the largest credit unions have eliminated them entirely. Pew’s research finds that late fees continue to be widespread. However, the cost of fees has gone down now that the law limits first-time late fees to $25 in most cases.<br />
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<strong><u><span style="color: #990000;">Annual fees have changed little.</span></u></strong><br />
Last year, roughly 14% of both bank and credit union cards carried annual fees; in 2011, that number held steady for credit union-issued cards and rose to 21% for bank-issued cards. The amount charged for annual fees held stable at a median of $59 for banks and $25 for credit unions. Forty percent of cards with annual fees included no-fee promotions for the first year.<br />
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"The Credit Card Act is an excellent example of how bipartisan legislation can be enacted that both protects consumers from potentially harmful practices while simultaneously creating a marketplace where banks and credit unions are able to compete based on clear and predictable pricing," said Eleni Constantine, director of the Financial Security Portfolio at the Pew Health Group. "Congress should take a similar approach to make other financial products, such as checking accounts and short-term, small-dollar loans, safer and more transparent."<br />
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The Pew Health Group is the health and consumer-product safety arm of The Pew Charitable Trusts, a nonprofit, public policy research organization.Angela Carterhttp://www.blogger.com/profile/12819817372215002169noreply@blogger.com0tag:blogger.com,1999:blog-2457150592733524440.post-34506749111404460192011-05-06T15:14:00.008-04:002011-05-13T19:02:40.100-04:00Bonds May Not Be The “Safe” Investment You Think<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAnV3ZkJU0Np7RMzWQQh8TNCFJJep4wQ1xd9jQfqt8gcKdCrFPwVoL7QH3WV1qAaOBYmtuOJmDzXR_vKod6HMdyE_6NzHJ9vvNgprxNOEMrg70qBekXX5NMpAB_eaVB6JfbLLwOAaNdJc/s1600-h/PaulSchatz.jpg"><img alt="" border="0" id="BLOGGER_PHOTO_ID_5385080613162580258" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAnV3ZkJU0Np7RMzWQQh8TNCFJJep4wQ1xd9jQfqt8gcKdCrFPwVoL7QH3WV1qAaOBYmtuOJmDzXR_vKod6HMdyE_6NzHJ9vvNgprxNOEMrg70qBekXX5NMpAB_eaVB6JfbLLwOAaNdJc/s320/PaulSchatz.jpg" style="float: left; height: 320px; margin: 0px 10px 10px 0px; width: 258px;" /></a><em>(Editor's Note: Paul Schatz, President of Heritage Capital, LLC, in Woodbridge, will be contributing to Fi$callyFit every Friday. </em><a href="http://www.investfortomorrow.com/CallinShots.asp"><em>Read his biography here</em></a><em>)</em><br />
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<span style="font-family: "Verdana","sans-serif"; font-size: 10pt;"><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">Many investors consider bonds the "safe" investment. But in considering a bond "safe" you may be failing to manage some very real risks that bond investing presents. These risks are why bonds, like equities, require ongoing oversight and active management.<o:p></o:p></span></span><br />
<span style="font-family: "Verdana","sans-serif"; font-size: 10pt;"><span style="font-family: Times New Roman; font-size: small;"> </span> </span><br />
<span style="font-family: "Verdana","sans-serif"; font-size: 10pt;"></span><br />
<span style="font-family: "Verdana","sans-serif"; font-size: 10pt;"><div style="margin: 0in 0in 0pt;"><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">For starters, there is a difference between a bond fund and a bond.<o:p></o:p></span></div><span style="font-family: Times New Roman; font-size: small;"> </span></span><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">An individual bond is a promise to pay ongoing interest over the life of the bond and your principal at maturity. </span><br />
<span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">You have three risks with an individual bond. The first is the risk of default. The second is the risk that you will need your principal prior to maturity and be forced to sell a bond at a loss. The third risk is that when your bond matures, you will be unable to replace it with another bond paying comparable interest.<o:p></o:p></span><br />
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<div style="margin: 0in 0in 0pt;"><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">The value of a bond over its lifetime is directly related to (1) the perceived risk of default and (2) current interest rates. If you purchase a bond during a period when 6% interest rates are the norm, and interest rates subsequently fall, your bond could be worth more than its face value. If interest rates were to go up, the value of your bond, if sold prior to maturity, would fall because an investor could purchase other bonds offering higher returns.<o:p></o:p></span></div><br />
<div style="margin: 0in 0in 0pt;"><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">A bond fund is a collection of bonds with differing maturities and interest rates. The manager buys and sells bonds with the goal of increasing the value of the fund. The investor receives diversification across multiple bond issues, professional selection of bonds with an eye toward reducing the risk of default, and laddering of bonds of different maturities and returns typically with the goal of creating a stable flow of income (but no guarantee). <o:p></o:p></span></div><br />
<span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">Unless the bond fund is a Unit Investment Trust (UIT,) it has no maturity and thus no obligation to return your principal. If a bond fund falls in value, there is no option of simply holding it until maturity to recapture your principal. The value of your investment in a bond fund will change in response market conditions and interest rates. On the other hand, you gain liquidity through the ability to sell virtually all bond funds at the current fund value (NAV).<o:p></o:p></span><br />
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<div style="margin: 0in 0in 0pt;"><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">The problem with bond funds, and with bonds you might want to sell before maturity, is the future direction of interest rates. The chart below shows the change in interest rates over the last 10 years. With every drop in rate, the value of a good bond increases if sold today. It's a good ride and one you want to stay on as long as it lasts.</span></div><div style="margin: 0in 0in 0pt;"><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;"></span> </div><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg0C6QeEFfWUvcDW-ZaKa9dtstC-66gWtlmencBxQ-t7K2xJTZKrS0oaMaeL37lVe6ettvV9Emt4VeRWsMlbp-ZV0mQ7dOnw1S3MMBnYVBosI3s5LVl_gRe5mH4Co8VLr_1AUCgB_6SU0Ev/s1600/bondchart.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="410" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg0C6QeEFfWUvcDW-ZaKa9dtstC-66gWtlmencBxQ-t7K2xJTZKrS0oaMaeL37lVe6ettvV9Emt4VeRWsMlbp-ZV0mQ7dOnw1S3MMBnYVBosI3s5LVl_gRe5mH4Co8VLr_1AUCgB_6SU0Ev/s640/bondchart.jpg" width="640" /></a></div><div style="margin: 0in 0in 0pt;"></div><div style="margin: 0in 0in 0pt;"><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">The catch is that we don't know how long interest rates will remain at their current lows. The Federal Reserve has indicated that it sees no need for increases in the Fed Funds rate in the near future. The economy still struggles to recover and low rates are a good thing for the greatest debtor in our country - the U.S. Government. What we do know is that when rates begin to rise, they will affect the value of a bond portfolio. That's when risk management needs to be a part of the portfolio. </span></div><div style="margin: 0in 0in 0pt;"></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;">Feel free to email me with any questions or comments at <a href="mailto:Paul@investfortomorrow.com"><span style="color: #002060;">Paul@investfortomorrow.com</span></a>.<o:p></o:p></span></div><div style="margin: 0in 0in 0pt;"><span style="font-family: Times New Roman; font-size: small;"></span><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><o:p><span style="font-family: Times New Roman;"> </span></o:p></span></div><div style="margin: 0in 0in 0pt;"><span style="font-family: Times New Roman; font-size: small;"></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;">Until next time…<o:p></o:p></span></div><div style="margin: 0in 0in 0pt;"><span style="font-family: Times New Roman; font-size: small;"></span><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><o:p><span style="font-family: Times New Roman;"> </span></o:p></span></div><div style="margin: 0in 0in 0pt;"><span style="font-family: Times New Roman; font-size: small;"></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;">Paul Schatz</span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><br />
</div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><span style="color: black; font-family: Times New Roman;"> </span></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;">Heritage Capital LLC<o:p></o:p></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: black; font-family: Times New Roman;"> </span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><a href="http://www.investfortomorrow.com/"><span style="color: #002060;">http://www.InvestForTomorrow.com</span></a></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;"><span style="color: #002060;"><a href="http://retirementplanningconnecticut.com/">http://RetirementPlanningConnecticut.com/</a></span></span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: black; font-family: Times New Roman;"> </span></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 0pt;"><span style="color: #002060; font-family: "Verdana","sans-serif"; font-size: 12pt; mso-bidi-font-family: Arial;">Follow us on Facebook at <a href="http://www.facebook.com/heritagecapital"><span style="color: #002060;">www.facebook.com/heritagecapital</span></a> and on Twitter @Paul_Schatz</span><span style="color: black; font-family: Times New Roman;"> </span></div>Angela Carterhttp://www.blogger.com/profile/12819817372215002169noreply@blogger.com0tag:blogger.com,1999:blog-2457150592733524440.post-41162762936368990672011-05-02T19:15:00.000-04:002011-05-02T19:15:04.022-04:00A Chinese Proverb on time and moneyThought I'd share a Chinese proverb with you from my collection of favorites:<br />
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<strong><em><span style="color: #274e13;">With money you can buy a clock, but not time.</span></em></strong><br />
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<span style="color: black;">Enjoy and please pass it on...</span><br />
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AngiAngela Carterhttp://www.blogger.com/profile/12819817372215002169noreply@blogger.com0tag:blogger.com,1999:blog-2457150592733524440.post-35822401017059288642011-05-02T19:06:00.000-04:002011-05-02T19:06:02.581-04:00Treasurys up slightly after bin Laden's death<span style="color: #274e13;">NEW YORK (AP)</span> — Treasury prices inched up Monday as investors weighed the news of Osama bin Laden’s death. <br />
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The price of the 10-year Treasury note rose 9.37 cents per $100 invested in late trading. Its yield, which moves in the opposite direction, fell to 3.28 percent from 3.29 percent late Friday. <br />
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Traders initially sold off government bonds after President Barack Obama said that bin Laden, the al-Qaida chief behind the Sept. 11, 2001 attacks, had been killed by U.S. forces in Pakistan. But investors eventually returned to the market on the belief that the threat of terrorism had not changed materially. <br />
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Traders also shrugged off a report that showed manufacturing activity grew for the 21st straight month in April. <br />
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In other trading, the price of the 30-year Treasury bond rose 31.2 cents per $100 invested, while its yield fell to 4.38 percent from 4.40 percent late Friday. The yield on the two-year note was unchanged at 0.61 percent. <br />
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In the market for short-term Treasury bills, the three-month T-bill paid a 0.03 percent yield. Its discount was 0.04 percent.<br />
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<strong><u><span style="color: #274e13;">Commodities Review:</span></u></strong><br />
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<em><span style="color: #274e13;">FALLING GRAINS:</span></em> Corn prices fell 3 percent on expectations that planting will pick up this week in parts of the western Corn Belt because of drier weather. Wheat and soybeans also fell. <br />
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<em><span style="color: #274e13;">BIN LADEN IMPACT:</span></em> With the exception of gold and oil, commodities not affected much by concerns about possible extremist retaliation after U.S. forces killed Osama bin Laden Sunday in Pakistan. Gold settled slightly higher while oil fell slightly. <br />
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<em><span style="color: #274e13;">DOLLAR’S EFFECT:</span></em> Many commodities benefited from a weaker dollar. Since commodities are priced in dollars, a weaker dollar makes them more of a bargain for buyers using other currencies.Angela Carterhttp://www.blogger.com/profile/12819817372215002169noreply@blogger.com0tag:blogger.com,1999:blog-2457150592733524440.post-82652491892513846822011-04-28T23:00:00.001-04:002011-05-06T15:09:55.808-04:00Stock Market Building Towards THE Peak<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAnV3ZkJU0Np7RMzWQQh8TNCFJJep4wQ1xd9jQfqt8gcKdCrFPwVoL7QH3WV1qAaOBYmtuOJmDzXR_vKod6HMdyE_6NzHJ9vvNgprxNOEMrg70qBekXX5NMpAB_eaVB6JfbLLwOAaNdJc/s1600-h/PaulSchatz.jpg"><img alt="" border="0" id="BLOGGER_PHOTO_ID_5385080613162580258" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjAnV3ZkJU0Np7RMzWQQh8TNCFJJep4wQ1xd9jQfqt8gcKdCrFPwVoL7QH3WV1qAaOBYmtuOJmDzXR_vKod6HMdyE_6NzHJ9vvNgprxNOEMrg70qBekXX5NMpAB_eaVB6JfbLLwOAaNdJc/s320/PaulSchatz.jpg" style="float: left; height: 320px; margin: 0px 10px 10px 0px; width: 258px;" /></a><em>(Editor's Note: Paul Schatz, President of Heritage Capital, LLC, in Woodbridge, will be contributing to Fi$callyFit every Friday. </em><a href="http://www.investfortomorrow.com/CallinShots.asp"><em>Read his biography here</em></a><em>)</em><br />
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As I write this Federal Reserve Chairman Ben Bernanke is just beginning his first ever, "official" press conference. As savvy as he is, (remember his first 60 Minutes interview right at the bear market low?) I doubt that we will hear anything unexpected in his remarks or his answers to media questions. <br />
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The latest bull run in stocks that began on March 16 remains alive and well. A few weeks ago, I offered that since we saw some of the key indices making new highs, that boded well for the others to play catch up. Since then, the Dow Industrials, Dow Transports and S&P 500 have scored fresh highs with the Nasdaq 100 a few cents away.<br />
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<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgPyJA0yv_K5UE04j14DqB-XLBvL9WaDCvrP961vIuHydPJHgso-w8m_BH1sfpOcT4eN7kJfjMjRV5mFp5Ec2YOMAlSKvwOREZKjlONANaaMB9C6KGSc1TCt25k5b2frcuT5bBsonk82L0/s1600/sp.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="444" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgPyJA0yv_K5UE04j14DqB-XLBvL9WaDCvrP961vIuHydPJHgso-w8m_BH1sfpOcT4eN7kJfjMjRV5mFp5Ec2YOMAlSKvwOREZKjlONANaaMB9C6KGSc1TCt25k5b2frcuT5bBsonk82L0/s640/sp.jpg" width="640" /></a></div><br />
On the flip side, volume remains woefully pathetic and eventually that's going to matter. Sector leadership is very good, BUT the key financial sector is behaving very poorly. With the indices at new highs and this group in a downtrend, something has to give sooner than later. <br />
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So far, nothing has changed in my thinking that a possible significant peak is building sometime this quarter. Besides what I've already mentioned, I am focusing on the junk bond and small cap areas where the first sign of evaporating liquidity should be seen. <br />
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The initial decline from any major top is going to look exactly like every other small pullback, only in this case, the next rally will fail short of new highs and a sharp, relentless decline will ensue. As always, we will take it one step at a time and do our best to protect the gains we've been fortunate enough to make. <br />
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I hope that none of you are sitting back, complacently believing that we survived 2008 and all is good in the world. That we are on the cusp of another decade long bull market to untold riches. In case you haven't realized it, the stock market (and many, many, many mutual funds) is at the same level it was 12 years ago! That's essentially 0% return on your money BEFORE inflation! So factoring in that pesky inflation thingy, you end up with a significant loss.<br />
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I urge you! I beg you!! You have a plan in place in case you get into a car accident. You have a plan in place in case your house burns down. Don't sit back and hope that everything works out with your money. Now is not the time to procrastinate. It's the time to put a plan together. Investors don't plan to fail; they fail to plan!<br />
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Feel free to email me with any questions or comments at <a href="mailto:Paul@investfortomorrow.com">Paul@investfortomorrow.com</a>.<br />
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Until next time…<br />
<br />
Paul Schatz<br />
<br />
Heritage Capital LLC<br />
<a href="http://www.investfortomorrow.com/">http://www.investfortomorrow.com/</a><br />
<a href="http://retirementplanningconnecticut.com/">http://RetirementPlanningConnecticut.com/</a><br />
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Follow us on Facebook at www.facebook.com/heritagecapital and on Twitter @Paul_SchatzAngela Carterhttp://www.blogger.com/profile/12819817372215002169noreply@blogger.com0