What’s Coming Down the Road?

Americans are being misled by the government and the media about the supposed recovery we are experiencing.  They say we are adding jobs each month and report the stock market is continuing to do well, but these reports are masking growing issues which nobody seems to be talking about.  Wages are continuing to stay flat and have done so for years despite inflation and a growing cost of living.  American workers, today, have to work more hours than ever before because of this.  The government and media fail to point this out when they talk about the economy rebuilding.

Another issue is the generation of millennials.  Many of them seem to have adopted a negative personal philosophy about working and how to manage themselves as we head into the future.  They’re well known for being highly educated but extremely self-absorbed.  Despite many of them being kids and living through the Great Recession, they haven’t turned out like the greatest generation who came out of the Great Depression.  Instead, they are narcissistic, lazy and unfocused, so the stereotypes say.  Dawn J Bennett points out the blame cannot be completely laid upon their shoulders though because they were raised that way, so in some degree its’ a reflection of their parents.

The millennials also face a far more difficult economic and career situation as they come of age.  Many were raised with the idea that going to college would guarantee them a place in the workforce with a good paying job.  Unfortunately, as Dawn J Bennett notes, the idea of having a job right after college which will help you pay off your student loans and eventually turn into a career that allows you to support a family simply isn’t true.  We have not had a generation which has been burdened with so much debt and economic instability in decades.

That is the other issue which our country is facing and seems to be nearly inescapable.  We have politicians who are unwilling to raise revenue for the government and unwilling to cut anything.  The result is a growing deficit and unsustainable programs which will eventually collapse under their own weight.  We need people to become more politically active and get better politicians into office so that we can get our government and country back on track.  Don’t forget, Janet Yellen still hasn’t raised Federal interest rates which mean the current economy is even more unstable then we are seeing.  Will they ever get their heads on straight?  We will have to wait and see.

 

Bennett Group Financial Services LLC, based in Washington, D.C., is a comprehensive financial services firm committed to providing opportunities to clients’ as they seek long-term financial success. Its customized programs are designed with the potential to help grow, lower overall risk and conserve client assets by delivering a high level of personalized service and skill.

For more information, call 866-286-2268 or visit http://www.bennettgroupfinancial.com

Securities offered through Western International Securities Inc. (WIS), member FINRA/SIPC. BGFS and WIS are separate and unaffiliated entities.

About Dawn Bennett

Dawn Bennett is CEO and Founder of Bennett Group Financial Services. She hosts a national radio program called Financial Myth Busting http://www.financialmythbusting.com

She discusses educational topics and events in the financial news, along with her thoughts on the economy, financial markets, investments, and more with her live guests, who have included rock legend Ted Nugent, as well as Steve Forbes and Grover Norquist. Listeners can call 855-884-DAWN a as well as take podcasts on the road and forums for interaction.

She can be reached on Twitter @DawnBennettFMB or on Facebook Financial Myth Busting with Dawn Bennett or dbennett@bennettgroupfinancial.com

Inner City Improvement

The last year and a half has been a turbulent one in inner cities across the nation.  We have seen unrest in Ferguson, New York and most recently Baltimore.  The problems happening in these cities and others across the country are two-fold.  First the way police are interacting with colored residents in the community is definitely less than ideal and secondly is the lack of opportunity for residents of these communities.  In order to gain a better idea of the financial troubles happening in these cities, particularly Baltimore, Dawn Bennett invited Liz Peek, a contributor to Wall Street Journal, Oil and Gas Journal and a columnist and reporter for Fox News and the Financial Times.

Dawn J Bennett broke straight into the topic by asking whether government was performing well or not.  Liz reminded us Baltimore is in fact the recipient of some of the highest amounts of federal money per pupil in the country, second only to New York City.  The problem she highlights is when this much money is coming in it becomes a ripe breeding ground for corruption and that is what is happening in the city government.  Additionally, she points out that the returns we are seeing for the amount of money invested in these students is incredibly underwhelming.

Liz Peek instead points out that one of the bigger problems for these kids in the inner cities is the lack of role models in their lives.  All of the kids want to be a big name rapper or the next superstar basketball player, but the reality is most of them won’t be able to make it to there.  There are no role models for these kids of responsible adults who work a regular 40 hour per week job which supports them comfortably.  We also have schools in these areas not teaching kids the necessary skills for taking care of themselves after they graduate from high school.

Schools used to teach kids the skills necessary for making a living as a repairman/woman but many people felt that was discriminatory for these schools to teach and for a long time we’ve seen courses like that and two year programs disappear.  Lately though, we’ve seen these classes start to make a return.  People are realizing the importance of such classes and making sure these kids have knowledge that will help them earn a living.  If we don’t give these kids more realistic education then their other options are basically welfare or jail which is very counterproductive.

Dawn J Bennett and Liz Peek made it very clear that what the country needs the most at this point in time is the passing of a strong jobs bill that will help improve the infrastructure of our country.  We need a jobs bill that is productive and well laid out, and so far our government has failed to produce this.

Is Greece The First Domino?

Global financial stability is something we all would love to have, but it appears as though achieving that may not be easy.  The U.S. economy has been gaining jobs since 2008, the stock market has made major gains and companies are spending more too.  Unfortunately, a lot of this economic upswing is mired in a shaky and questionable foundation.  While some say we’re still in a recovery, there are some surprising statistics which will make you reconsider that.  In the first quarter of 2015 we had twice the number of businesses close as we did in the first quarter of 2014.  Furthermore, companies, like Caterpillar, are continuing to see declining global retail sales.  Caterpillar has gone 28 months so far, when the 2008 crisis hit they had seen 19 months of declining global retail sales.

Meanwhile in Europe the dilemma of Greece and whether it will default or repay debts is looming big.  The deadline for them accepting the loan terms from the EU was this past Friday, May 1st.  The terms however haven’t been settled yet and so negotiations are still going on and hopefully a solution will be agreed upon before May 12th when Greece has to pay back the IMF.  Dawn J Bennett has been tracking this issue closely lately and is warning investors that they need to find a safe place for their liquid assets to weather the potential storm.

Germany and the EU have stated that if terms cannot be agreed upon with Greece then perhaps Greece leaving the EU may be the best solution.  The reasoning behind this is Eurozone contracts currently don’t hold much validity and European bonds are trading at a negative yield therefore only central banks are buying them.  The U.S. currently believes that Greece leaving the Eurozone poses a dangerous risk to the global economy which is unnecessary.  If Greece does cause the chain reaction that many financial experts are afraid it might, then investors need to be prepared.

As an investor you won’t be able to rely on anyone or any institution to save you if this financial mess comes to fruition.  Central banks are so entrenched in the current markets that they have no easy way to carefully remove themselves without causing problems.  Then there are Wall Street banks which are once again taking unnecessary risks, but are still too big to fail.  Dawn J Bennett recently brought up the matter of whether human happiness is the ultimate goal.  She quotes Aristotle who said “Happiness depends upon ourselves”.  In this era of financial instability and turmoil it certainly seems like what Aristotle said is absolutely true.

Bennett Group Financial Services LLC, based in Washington, D.C., is a comprehensive financial services firm committed to providing opportunities to clients’ as they seek long-term financial success. Its customized programs are designed with the potential to help grow, lower overall risk and conserve client assets by delivering a high level of personalized service and skill.

For more information, call 866-286-2268 or visit http://www.bennettgroupfinancial.com

Securities offered through Western International Securities Inc. (WIS), member FINRA/SIPC. BGFS and WIS are separate and unaffiliated entities.

About Dawn Bennett

Dawn Bennett is CEO and Founder of Bennett Group Financial Services. She hosts a national radio program called Financial Myth Busting http://www.financialmythbusting.com

She discusses educational topics and events in the financial news, along with her thoughts on the economy, financial markets, investments, and more with her live guests, who have included rock legend Ted Nugent, as well as Steve Forbes and Grover Norquist. Listeners can call 855-884-DAWN a as well as take podcasts on the road and forums for interaction.

She can be reached on Twitter @DawnBennettFMB or on Facebook Financial Myth Busting with Dawn Bennett or dbennett@bennettgroupfinancial.com

Job Reports: Covering Up the Grim Reality

The recent reports being released by the Bureau of Labor Statistics would make the average citizen believe that we have an economy that is growing and regularly gaining jobs every month.   In fact, according to the report for February, it was the twelfth consecutive month of over 200,000 jobs created.  The problem with these reports is how they represent the data they have collected.  If we begin to dig deeper into the information and how they determine each statistic we quickly come to realize that there is a dark and grim truth underneath these positive sounding numbers.

Let’s begin dissecting these numbers and the reality behind them.  For February the BLS said unemployment was down to 5.5% from 5.7% in January and the economy created close to 300,000 jobs.  So here’s the first important issue, the people they counted in those unemployment numbers are called “U3” unemployment, which means they’ve been actively looking for the last four weeks.  If you were someone who actively looked for work up until one day before the last four weeks then you are not counted.  You’re considered a “discouraged” or “marginally attached” worker.  The unemployment number also doesn’t count those who are only doing temporary work and could switch jobs in between surveys.

That’s not the only number the survey isn’t counting either.  Workers who have given up searching for work because they believe there aren’t any jobs for them anymore are put in a category called U6.  This class of workers is roughly 11% of the workforce, but they have been dropped from consideration because of their long lack of activity in pursuing a new job.  According to Dawn Bennett when you add up all these numbers you will sadly discover that roughly 23.1% of Americans capable of working aren’t.  Obviously, that doesn’t take a genius to realize something is seriously wrong.

If you think those facts are startling; hold on to the seat of your pants then.  According to the report, 58,700 of the jobs created in February were waiters and bartenders.  These jobs also happen to have gained the most in the minimum wage category over the last eighteen months, but these definitely aren’t the full time jobs that give people financial stability and independence.  Part of what has wrecked the American economy over  the last twenty years has been the free trade agreements, such as the North American Free Trade Agreement (NAFTA) and when China joined the World Trade Organization (WTO) in 2001.  These agreements have cost us American manufacturing jobs to the tune of roughly 2.1 million+.  As Dawn Bennett points out, this has caused American households to lose wage growth and also lead to ballooning trade deficits with these countries.

Our economy isn’t as strong and robust as many would like everyone to believe.  It’s time for all of us to pull our heads out of the sand and examine the information we are being given more closely, so that we know what is happening and how to best invest our money.

 

Bennett Group Financial Services LLC, based in Washington, D.C., is a comprehensive financial services firm committed to providing opportunities to clients’ as they seek long-term financial success. Its customized programs are designed with the potential to help grow, lower overall risk and conserve client assets by delivering a high level of personalized service and skill.

 

For more information, call 866-286-2268 or visit http://www.bennettgroupfinancial.com

Securities offered through Western International Securities Inc. (WIS), member FINRA/SIPC. BGFS and WIS are separate and unaffiliated entities.

 

About Dawn Bennett

Dawn Bennett is CEO and Founder of Bennett Group Financial Services. She hosts a national radio program called Financial Myth Busting http://www.financialmythbusting.com

She discusses educational topics and events in the financial news, along with her thoughts on the economy, financial markets, investments, and more with her live guests, who have included rock legend Ted Nugent, as well as Steve Forbes and Grover Norquist. Listeners can call 855-884-DAWN a as well as take podcasts on the road and forums for interaction.

She can be reached on Twitter @DawnBennettFMB or on Facebook Financial Myth Busting with Dawn Bennett or dbennett@bennettgroupfinancial.com

A Storm is Brewing

The economy has been trending upwards for some time, or so that’s what the media and everyone in D.C. would like to lead us to believe.  There is more than meets the eye though.  Yes, it is true the stock market’s prices have been on the up and they appear to be doing quite well over the last six years.  However, underneath that shiny looking exterior is a grimmer and unsettling picture.  The economy has been adding jobs, but these jobs aren’t high paying and they aren’t providing the full 40 hours that adults need in order to live a stable lifestyle.  Furthermore, people with full-time jobs aren’t seeing wage growth needed to keep up with inflation.

Dawn J. Bennett has been tracking and covering these problems in detail for years now and is calling out to investors to put their thinking caps on.  It is no longer enough or safe to simply be well educated on the markets; investors need to really dig deep so that they have a more fundamental understanding of what is happening with the economy.  For example, just recently the University of Michigan’s final February consumer sentiment numbers were released and it went from 98.1 in January to 95.4 in February.  This means people are beginning to lose hope in the idea that incomes will rise and better business opportunities are coming.

Another warning signal that has smacked us straight across the face is the drop in the Chicago Business Barometer from January to February.  In January the rating was 59.4 and in February it plummeted to 45.8 – that’s the lowest it’s been since 2009.  For those not familiar with the Chicago Business Barometer it is also known as the Chicago Purchasing Manager Index (Chicago PMI).  It measures the health of the manufacturing sector and in general when the score falls below 50 it indicates contraction in the future for the economy.

We all wish the bad news ended there, but Dawn J. Bennett has done her research and has more that indicates a storm is coming for us.  The Bureau of Economic Analysis (BEA) also recently revised its estimate for fourth quarter 2014 GDP growth down.  The revised number was 2.18% which was roughly a 43% drop from the third quarter.  Downward revisions in GDP growth are always a major warning for the economy and it appears as those in the Federal Reserve and D.C. are blind to these realities.

It’s time for investors to stop glossing over these important numbers and details.  There has been too much aggressiveness in the market lately over unstable investments.  It’s time to pay attention to the smaller numbers and dig into reports to gain a real understanding of what is happening in our economy.  It’s time for everyone to stop letting themselves be told the future is sunny and smooth sailing because the reality is we’re heading into a major economic storm that will be brutal for lots of us.

 

Bennett Group Financial Services LLC, based in Washington, D.C., is a comprehensive financial services firm committed to providing opportunities to clients’ as they seek long-term financial success. Its customized programs are designed with the potential to help grow, lower overall risk and conserve client assets by delivering a high level of personalized service and skill.
For more information, call 866-286-2268 or visit http://www.bennettgroupfinancial.com
Securities offered through Western International Securities Inc. (WIS), member FINRA/SIPC. BGFS and WIS are separate and unaffiliated entities.
About Dawn Bennett
Dawn Bennett is CEO and Founder of Bennett Group Financial Services. She hosts a national radio program called Financial Myth Busting http://www.financialmythbusting.com
She discusses educational topics and events in the financial news, along with her thoughts on the economy, financial markets, investments, and more with her live guests, who have included rock legend Ted Nugent, as well as Steve Forbes and Grover Norquist. Listeners can call 855-884-DAWN a as well as take podcasts on the road and forums for interaction.
She can be reached on Twitter @DawnBennettFMB or on Facebook Financial Myth Busting with Dawn Bennett ordbennett@bennettgroupfinancial.com

Why the Student Loan Credit Market is Ready to Burst

Despite the President’s insistence that the U.S. economy is in good health, expert financial analysts agree that in reality, it’s on the verge of repeating 2008’s financial collapse. This is largely the result of economic policies that, as with 2008’s housing bubble, have facilitated the emergence of asset bubbles throughout a range of industries. Among the many industries at risk of becoming “bubbles,” the student loan credit market seems poised to be the economy’s most vulnerable given the President’s new plans for higher education.

While the Obama Administration’s proposal to provide two free years of community college to students nationwide may be a good will attempt to increase access to higher education, it will ultimately channel money from the wealthy to the middle class, and in doing so, create an education bubble. Plans to offer excessively low interest rates for student loans will only exacerbate this bubble. At a time when the average student loan debt for a 25-year old graduate is $33,000, talks of loan interest rates being “too low” may not be popular; however, the underlying point is valid.

On one of her recent shows, Dawn J Bennett, host of the Financial Myth Busting with Dawn Bennett radio show, spoke with Freedom Works analyst Logan Albright, who agreed that when asset bubbles do begin to burst, the student loan credit market will be the first to go.

As Albright notes, nobody’s trying to argue that the average amount of student loan debt isn’t high; the issue is that rather than trying to make the cost of tuition manageable, we’re simply taking measures to extremes by providing essentially non-existent interest rates, extensive lines of credit, or in some cases, completely free education.

The student loan credit market has been on a dangerous trajectory for decades now, which is one of the primary reasons it will likely be the first sector of the economy to burst. The asset bubble magic recipe—high prices, easy money, and highly accessible credit—is certainly at play in today’s student loan credit market. As of last month, the student loan credit market surpassed the 1 trillion dollar mark, which means it’s the largest source of consumer debt in the United States. In the fourth quarter of 2014 alone, cumulative student loan debt increased by $31 billion.

In addition to rising costs of college, overextension of credit, and low interest rates, the student loan credit market is further hindered by its lenders inability to pay off their debts. The current job market, despite the President’s praises, simply doesn’t provide graduates with the means to consistently make their payments. Student loans maintain the highest level of delinquency (at 11.3 percent) compared to every other form of debt in the country.

Some, like well-known investor Mark Cuban, have gone so far as to predict that not only will the student loan credit market burst, it’s burst will effectively put colleges out of business. While this remains to be seen, there’s one thing that Cuban, Bennett, Albright, and others in the financial industry agree upon: the government’s approach to overseeing the student loan credit market has paved a clear path to a student loan bubble, one which all signs indicate is more than ready to burst.

 

Bennett Group Financial Services LLC, based in Washington, D.C., is a comprehensive financial services firm committed to providing opportunities to clients’ as they seek long-term financial success. Its customized programs are designed with the potential to help grow, lower overall risk and conserve client assets by delivering a high level of personalized service and skill.

For more information, call 866-286-2268 or visit http://www.bennettgroupfinancial.com

Securities offered through Western International Securities Inc. (WIS), member FINRA/SIPC. BGFS and WIS are separate and unaffiliated entities.

About Dawn Bennett

Dawn Bennett is CEO and Founder of Bennett Group Financial Services. She hosts a national radio program called Financial Myth Busting http://www.financialmythbusting.com

She discusses educational topics and events in the financial news, along with her thoughts on the economy, financial markets, investments, and more with her live guests, who have included rock legend Ted Nugent, as well as Steve Forbes and Grover Norquist. Listeners can call 855-884-DAWN a as well as take podcasts on the road and forums for interaction.

She can be reached on Twitter @DawnBennettFMB or on Facebook Financial Myth Busting with Dawn Bennett ordbennett@bennettgroupfinancial.com

 

Quantitative Easing Exiting Stage Left…Or is It?

dawn j bennett quantitative easing

Quantitative easing may finally be on its way out. At least that’s what we can gather from the latest World Economic Forum held in Davos, Switzerland this past January. The summit’s executive summary stated that given transformations and advancements in politics, economics, and technology, it’s time to normalize monetary policy, and this will only come by scaling back quantitative easing.

For approximately the last seven years, fiscal policy in both the U.S. and abroad has largely centered on the policy of quantitative easing, which refers to the process of introducing new currency into a nation’s money supply through the purchase of assets like government securities. Quantitative easing is generally a policy used to lower interest rates during a time of economic hardship, which is why the Federal Reserve pursued three phases of quantitative easing shortly after the economic recession of 2008. Though their approach to quantitative easing has been highly controversial and the cause of the stock market’s misleading representation of the health of the economy, the Federal Reserve announced in the fall of 2014 that its October 15 billion dollar government bond purchase would be the last step in its quantitative easing policy.

According to Dawn J Bennett, financial money manager, CEO of Bennett Group Financial Services, and host of Financial Myth Busting with Dawn Bennett, though this international “agreement” to depart from quantitative easing is much needed, it won’t be easy for everyone.

The primary reason the international community can expect bumps along the road ahead? Europe isn’t ending quantitative easing—just yet. In fact, Europe’s Central Bank began purchasing additional assets (1.1 trillion euros) on March 1st, which means that even as philosophy about quantitative easing has sharply shifted, policy has yet to catch up. Here’s why it’s problematic:

  • The European Central Bank has a limited number of assets it intends to purchase; these assets will come exclusively from the euro zone’s government bonds, while other futures contracts from the United States and Europe will not be pursued. A limited range of assets both heightens risk and limits the effectiveness of the policy.
  • To avoid unfairly aiding certain countries (i.e., Greece), the European Central Bank will only purchase 33% of bonds from individual issuers. However, because Greece will likely demand more money from the Central Bank to climb out of its present financial crisis, and because the Central Bank is now only able to provide them with 1/3 of what they ask, there could be trouble brewing for all to the tune of a bank shutdown.
  • The longer the EU pursues a policy of quantitative easing (as politicians determine which fiscal policy to pursue next), the weaker the euro becomes. A weak euro doesn’t put any future fiscal policy in a good starting position.

The fundamental differences that exist between the economic structures of the U.S. and the eurozone should also raise eyebrows about the practicality of the eurozone’s quantitative easing policy. Whereas the U.S. was able to benefit from being pushed into pursuing riskier assets like corporate bonds, the eurozone is far more dependent upon its banks, which means that there will be less benefit to an increase in its capital market.

As the eurozone’s quantitative easing process gets underway, we can only watch as what the leaders at Davos herald to be unsuitable economic policy weakens the European economy.

 

 

Bennett Group Financial Services LLC, based in Washington, D.C., is a comprehensive financial services firm committed to providing opportunities to clients’ as they seek long-term financial success. Its customized programs are designed with the potential to help grow, lower overall risk and conserve client assets by delivering a high level of personalized service and skill.

For more information, call 866-286-2268 or visit http://www.bennettgroupfinancial.com

Securities offered through Western International Securities Inc. (WIS), member FINRA/SIPC. BGFS and WIS are separate and unaffiliated entities.

About Dawn Bennett

Dawn Bennett is CEO and Founder of Bennett Group Financial Services. She hosts a national radio program called Financial Myth Busting http://www.financialmythbusting.com

She discusses educational topics and events in the financial news, along with her thoughts on the economy, financial markets, investments, and more with her live guests, who have included rock legend Ted Nugent, as well as Steve Forbes and Grover Norquist. Listeners can call 855-884-DAWN a as well as take podcasts on the road and forums for interaction.

She can be reached on Twitter @DawnBennettFMB or on Facebook Financial Myth Busting with Dawn Bennett ordbennett@bennettgroupfinancial.com