7 Reasons the Economy is Worse than it Seems

Do you believe the economy has improved significantly since the Great Recession?

Or do you feel like we’re staring down the barrel of a cannon whose fuse has already been lit?

The stock markets should be down considerably by plenty of measures, but many investors appear to have been hypnotized to believe that nothing can go wrong.

I believe things are worse than they may seem on the surface, and extreme caution is warranted, for the 7 reasons I spell out here.

I’ll also give you some tips on how to protect yourself and have a “Plan B” in place in case the you-know-what does hit the fan.

Here Are 7 Reasons the Economy is Worse than It Seems…

1. Addiction to Stimulus and Low or Negative Interest Rates

We have been guinea pigs in the greatest experiment in monetary policy in the history of the world.

Every time the Federal Reserve so much as sneezes, the markets whipsaw. In this topsy-turvy world, good news about the economy becomes bad news for the stock market and vice versa.

Even the Fed knows it’s in over its head and has lost control of the situation. But that won’t stop them from continuing to experiment with you and me as their lab rats.

2. Overheated Stock Market Valuations and Deteriorating Fundamentals

Profits for S&P 500 companies continue falling, but the S&P 500 is trading at the highest level of projected earnings since 2002.

3. Rising Poverty and Expanding Government Assistance Rolls

The U.S. poverty rate has actually risen since the “official” end of the Great Recession in 2009. (I say “official” end because, to a lot of Americans, it still feels like we’re mired in a recession.)

During the same period of time, food stamp usage increased 39%.

4. Persistent Underemployment

A measure of the number of people working part time who want – but can’t find – full-time work in their field, that peaked above 16% at the height of the last recession, still remains above 12%. Obviously, that’s a major drag on economic performance.

Slow Wage Growth5. Slow Wage Growth

Between 2009 and 2015 inflation-adjusted median weekly earnings actually fell by about 1%, and median household earnings fell by around 4%.

6. Global Economic Weakness

Many people underestimated how the economic situation in other parts of the world affects our economy. But no one can deny any longer how interconnected our economics all are.

Emerging economies like Brazil and Russia have been heavily impacted by falling commodity prices.

The largest economies in Europe are struggling. And China, which is now the world’s second-largest economy, is experimenting with an economic transition that many think is likely to fail.

If it does fail, the U.S. economy could be seriously impacted.

7. By Historical Standards, We’re Already Overdue for Another Recession

Historically, recessions occur at alarmingly regular intervals.

In fact, according to the National Bureau of Economic Research, by post-war standards, we’re almost two years past due for the next recession. Ugh.

The political uncertainty we are facing with the upcoming election isn’t helping any either.

As people who know me well will tell you, I’m an optimist – I always see the glass as half full.

But while I hope for the best, I also have a backup plan – my “Plan B” to help my family weather those tough economic times that seem to come when you least expect them.

What Characteristics Should a True Safe Money Plan B Have?

It should have all of these:

  • No loss of principal or gains in a market crash (safety nets)
  • Guarantees
  • Liquidity
  • Control
  • Tax-favored
  • Contractual growth guarantees

Out of the more than 450 financial products I’ve investigated, only one meets all the requirements: The Bank On Yourself method, based on super-charged dividend-paying whole life insurance. These plans have increased in value every single year for more than 160 years, in every period of boom and bust, including during the Great Depression.

And no luck, skill or guesswork is required to make that happen.

In addition to the benefits I mentioned above, the Bank On Yourself method also provides:

  • Asset Protection – your cash values are protected from creditors and lawsuits (varies by state)
  • Privacy – your plan and its growth, along with the income you take from it, are generally not reported to the government or IRS
  • Lets You Become Your Own “Banker” – so you can get access to cash whenever and for whatever you want – no questions asked

You control how and when you pay it back and – if your policy is from one of a handful that offer this feature – your plan can continue earning the same guaranteed annual increase and any dividends the company credits, even when you’re using that money elsewhere!

Here’s the Key Question to Ask Yourself:

Safe Money Plan

Does having your money…

  • safe…
  • liquid…
  • growing significantly faster long-term than a savings, money market account or CD…
  • and earning the exact same guaranteed annual increase and dividends – even when you use it

… take away any of your options?

The reality is that it gives you more options, not fewer.

Here’s how to protect yourself in scary times

It wasn’t raining when Noah built the ark. To find out how you can benefit from a custom-tailored Bank On Yourself plan, and discover why it’s the ultimate financial bunker for scary economic and political times, simply request your FREE Analysis here.

You’ll also get a referral to one of only 200 advisors in the U.S. and Canada who have met the rigorous requirements to be Bank On Yourself Authorized Advisors.

Don’t dilly dally! Do it now! Just click this button:

Yellow-Button-FREEanalysis-trans

Dalbar 2016 Report: Many Investors Haven’t Even Kept Up With Inflation

The latest report from DALBAR reveals the harsh reality about the actual returns stock market investors have been getting for the last 30 years.

Would it surprise you to know that many investors haven’t even been able to keep up with inflation for the last three decades?

Many investors haven’t, according to the 2016 Quantitative Analysis of Investor Behavior.

Here are the facts about actual long-term investor returns

The average investor in asset allocation mutual funds (which spread your money among a variety of classes) earned only 1.65% per year over the last three decades!

These investors didn’t even come close to beating inflation, which averaged 2.6% per year.

The average investor in equity mutual funds averaged only 3.66% per yearbeating inflation by only 1% per year. (Was that worth the roller-coaster ride and sleepless nights?) [Read more…]

What’s In “The Big Black Book of Income Secrets”?

If you receive emails from investment advisory services, you may have gotten a sales pitch for The Big Black Book of Income Secrets from the Palm Beach Research Group.

The promo promises you’ll discover “30 unique income tools” in The Big Black Book of Income Secrets.

The offer entices you with a “risk-free 60-day trial subscription to the Palm Beach Letter.” If you’re not satisfied before the two-month trial is up, you’re told you can get a refund and keep the book and some “bonus” reports that are included in the offer.

To find out if The Big Black Book of Income Secrets lived up to its promises, we signed up for the “Platinum Subscription” for $99 for the first year, which comes with additional “bonus” reports.

Three weeks later, the book arrived, containing 22 (not 30 as promised) strategies, with a cover letter from the Publisher, Tom Dyson, explaining that we could log into their website to access the reports we signed on for and back issues of the Palm Beach Letter. (I guess for $99, they can’t afford to mail you hard copies of the reports.)

The First Red Flag in The Big Black Book of Income Secrets is “Income For Life”

[Read more…]

The Movie You MUST See If Your Money is in the Market

You probably already know – or at least strongly suspect – that Wall Street is rigged. And not in favor of the little guys and gals like us.

But this blog post should lay any doubt about that to rest…

Let’s start with the movie you must see if you have any money invested in the market (or need a reminder of why you yanked it out in the first place).

The Big Short is based on the New York Times best seller by Michael Lewis. The main characters are played by Brad Pitt, Ryan Gosling and Steve Carell.

the-big-shortIt recounts the story of a handful of Wall Street traders who (ultimately) made a fortune by betting against the mortgages that caused the housing bubble… and subsequent crash and Great Recession. [Read more…]

Why you need Dow 35,000 today

I have an important question to ask you…

When do you think the Dow will hit 35,000?”

Does that seem like a crazy or dumb question? After all, the Dow closed 2015 at only 17,425. It would have to more than double to get to 35,000. But it’s not a dumb question. I’ll explain why in a moment.

For the last five years, we’ve been tracking the Dow Jones Industrial Average and what that number means to you in your real life.

Sure, the Dow has gone up and down, and it’s gone up more than it’s gone down. But is it up enough to actually give you a return that justifies after all the sleepless nights and stomach-churning highs and lows?

Then there’s inflation. Has the market, as measured by the Dow Jones Industrials, even kept up with inflation? [Read more…]

Has the Risk You’ve Taken in the Stock Market Since 2000 Been Worth It?

Take a quick guess – what do you think the average annual return of the S&P 500 Index has been since the start of the century almost 16 years ago?

Especially in light of the recent bull market, one of the biggest in history.

So what percent do you think the index has grown on average each year? Maybe 4%? 8%? 12%?

C’mon – humor me and take your best guess…

Okay… so over the last nearly 16 years, since January 1, 2000, the S&P 500 (which represents the broad market) has had an annual growth rate of only 1.96% per year. (Note: We are referring to the Compound Annual Growth Rate or “CAGR”.) [Read more…]

Vacations are for People, NOT Your Retirement Plan

Do you remember how much value the stock market lost in the crashes of 2000 and 2007? I’m talking about what percent the market lost during each of those crashes.

If you’re not sure, take a guess before you read on.

The tech crash happened just 15 years ago. The S&P 500 lost 49% from March, 2000 to October, 2002. Many investors – myself included – had moved their money into NASDAQ tech stocks, which plunged 78% during that same 2-1/2-year period.

Then the S&P 500 peaked again in 2007 – just a few years later. By March of 2009, it had plunged 57%.

That makes two heart-stopping losses of more than 49% just in the last 15 years. [Read more…]

A 9.94% Annual Return Without Market Risk? [Video Proof]

What if I told you that it’s possible to get an effective annual return of nearly 10% over time – without the risk of stocks, real estate or other volatile investments?

Watch the Video above to see proof of the return of Bank On Yourself (then click on the icon in the lower right to enlarge)

I’m pretty sure you’d wonder what I’ve been smoking!

But I’m going to prove to you how you would have to get a 9.94% return every year in a tax-deferred account like a 401(k) or IRA to equal the return of a Bank On Yourself Plan over the last half century.

To quickly recap, Bank On Yourself relies on a super-charged variation of an asset that has increased in value every single year for more than 160 years – dividend-paying whole life insurance. It’s never had a losing year – EVER – including during the Great Depression. [Read more…]

Why Your Retirement Account is Missing $186,000

An eye-opening Report released last month by the Center for Retirement Research at Boston College reveals that the fees charged by mutual funds and 401(k) and IRA plans will slash the value of the typical person’s account by almost 37%!

That means if your account should have been worth $500,000, you end up with only $314,000 – all because of stealth fees that are draining your hard-earned savings! That’s $186,000(!) of your money that will end up in other people’s pockets, not yours.

These money-sucking fees often apply even to funds that track stock market indexes such as the S&P 500… as well as to the “Target Date” Funds that most employers now automatically put employees’ 401(k) money into.

Listen to John Bogle, the founder and former CEO of Vanguard, who many consider to be the father of the indexed mutual fund, quoted in MarketWatch:

Question: “If you pay a hefty fee to an active manager, what happens to your potential return?” [Read more…]

Do you feel lucky?

For two years before the dot-com stock market bubble crashed, my husband Larry and I studied “stock charting” with one of the country’s top technical analysts. It’s one of the 450+ financial strategies and vehicles I’ve investigated over the last 25 years.

Stock charting looks at patterns in the charts of stocks, indexes and various market indicators to determine the best times to buy or sell, based on the knowledge that history repeats itself. (Frankly, I don’t have the patience for that kind of analysis and found it excruciatingly boring.)

History repeats itself in the stock marketWe owned a lot of tech stocks, and we’d check our retirement account balance every day because it was growing so fast. Some weeks we’d see such an enormous jump that we’d high-five each other shouting, “We’re rich! We’re rich!”

Yup, back then we were part of the “dumb money” – following the crowd like lemmings blindly following each other off a cliff. But I’m getting a little ahead of myself…

We were paying this analyst a good chunk of change for his coaching. Just when the dot-com bubble was peaking (as we now know with 20/20 hindsight), the analyst sent us this urgent one-sentence message: [Read more…]