U.S. Federal Public Debt

Posted on August 21, 2023 by Edward Brownlee

As of September 30, 2020, 64 percent of the outstanding amount of marketable Treasury securities held by the public (about $13.1 trillion) was scheduled to mature in the next 4 years. Current coupon rate is around 2,5 percent

During the past decade, the federal government’s debt increased at a faster rate than at any time since the end of World War II, outstripping economic growth over that period. At the end of 2019, federal debt was higher than at any other time since just after the war.

When the federal government runs an annual budget deficit, the Department of the Treasury borrows money to make up the difference between spending and revenue. Then, if special funds like the Medicare trust fund have surpluses, the “extra” revenue is lent to the rest of the federal government.

The federal debt is the total amount of money that the federal government owes, either to its investors or to itself. Total federal debt rose to $26.9 trillion at the end of fiscal year 2020, equal to about 79 percent of GDP, a higher percentage than at any other time since just after World War II.

To finance the government’s activities, the Treasury issues securities—collectively labeled debt held by the public—that differ in time to maturity, the ways they are sold to investors, and the structure of their interest payments. Marketable securities make up the lion’s share of that debt, and nontradable securities, such as savings bonds, make up the rest.

The Treasury sells securities in the capital markets—often through a primary dealer intermediary—to various U.S. buyers (such as the Federal Reserve System, mutual funds, financial institutions, and individual people), to private investors overseas, and to the central banks of other countries. Domestic investors currently own about three-fifths of outstanding debt held by the public.

Federal Fiscal Deficit vs. National Debt

Posted on April 25, 2023 by admin

Democrats spend money when they don’t raise taxes; and, Republicans cut taxes when they don’t decrease spending. Tax and spending reforms are needed desperately.

“The government has basically three gigantic programs and it’s the US military, Social Security, and Medicare,” Marc Goldwein, a senior policy director at Committee for a Responsible Federal Budget (CRFB) said. As Nobel-Prize-winning economist Paul Krugman once wrote, the US government is “best thought of as a giant insurance company with an army,” and increasing interest payments.

If the government wants to get serious about its fiscal spending and reducing the national debt, all government spending would have to be reduced by 27% to get budgets balanced in the next decade — and, if tax increases, defense spending, Social Security, and Medicare are all off the table, 78% of federal spending would have to be cut, according to CRFB.

The federal deficit vs. Debt — they’re two separate concepts.

The deficit is the difference between the money that the government makes and the money it spends during a fiscal year. If the government spends more than it collects in revenues, then it’s running a deficit.
The federal debt is the running total of the accumulated deficits.

The combination of spending increases, tax cutsc, and increasing interest expenses on the debt inflates deficits. While the rise in spending tends to be bi-partisan, tax cuts tend to be enacted by Republicans.

Reference:

More Than One in Four Americans Say Their Debt is Unmanageable

Posted on November 10, 2022 by admin

Nearly one in five Americans are feeling bad or very bad about their financial circumstances. ~ OppFi’s 2022 Personal Finance Study

The FinTech company, OppFi, surveyed nearly 1,100 Americans to learn more about Americans’ financial situations,.

Respondents had mixed and uncertain feelings about where they stood financially, with nearly one in five feeling bad or very bad about their circumstances.

Key takeaways

Half of respondents to the survey are currently in debt, and 52% of those in debt say their debt is not manageable.
Just over 1 in 3 respondents have frequently experienced stress or anxiety about their finances since the COVID-19 pandemic started.
1 in 4 took out a personal loan during the COVID-19 pandemic, most often to cover basic necessities such as food, clothing, and housing and credit card debt.

Americans’ financial health is often measured by benchmarks such as debt, savings, spending habits, and the ability to pay their monthly bills, writes Ashley Altus, CFC, a personal finance writer for OppU. OppFi survey respondents reported having difficulty with many of these things. Half said they’re in debt, and nearly half said they can’t pay their bills on time. Almost 2 in 5 live paycheck to paycheck, and 1 in 5 said they spend more than what they earn.

Budgeting is widely considered an important aspect of personal finance, but 1 in 10 said they didn’t have a budget at all.

Fewer than half (47%) said they have a savings account or emergency fund. Of those who did, nearly 1 in 5 said they could live off it for three weeks at the most.

How COVID-19 impacted Americans’ financial situations

The COVID-19 pandemic threw the American economy into chaos, with numerous businesses closing. In April 2020, the unemployment rate reached a level not seen since the 1930s. Near the end of 2021, 10 million households were behind on rent despite three rounds of stimulus checks.

More than half the people we surveyed said the pandemic worsened their financial situation. The biggest reason? Employment – more than 1 in 5 were working fewer hours and 15% lost their job. Others cited their own illness (17%), and 15% said their credit score decreased.

Financial stressors

One result of financial difficulty may be stress. Just over 1 in 3 respondents said they have frequently experienced stress or anxiety related to their finances since COVID started, with the most common stressor being paying bills other than mortgage or rent (cited by 35%). Debt was identified as a source of stress by 28% and 26% were stressed about not having enough savings.

Other stressors included basics like having enough food, high energy or gasoline prices, and paying mortgage or rent. Financial anxieties also reach as far as retirement, with more than 1 in 10 saying they’re worried they won’t have enough to retire on.

References:

https://www.opploans.com/oppu/articles/personal-finance-study-2022/

World in Love with Debt

Posted on October 19, 2022 by admin

“There is $50 trillion more in world debt today than there was in 2018.” And that will hurt equities. Larry McDonald

2021 global debt database shows largest one year debt surge post World War II to $226 trillion, i.e., 256% of global GDP in 2020. Government borrowing was half this increase; global public debt rose by 20% to an unprecedented level in over 50 years.

In a financial sense, the bond (or debt) market dwarfs the stock market. Although the rise in interest rates has been devastating for bond investors because of the inverse relationship between rates (yields) and bond prices. In actuality, both the debt and equity markets have fallen this year.

Yet, “The world is still in love with debt,” according to analysts at Bank of America Merrill Lynch. Debt vulnerabilities are rising, with potential costs and risks to debtors, creditors and, more broadly, global stability and prosperity. But, does it matter. After all, world governments owe the money to their own citizens. The rising total global debt is important for two reasons.

First, when debt rises faster than economic output (as it has been doing in recent years), higher government debt implies more state interference in the economy and higher taxes in the future.
Second, debt must be rolled over at regular intervals. This creates a recurring popularity test for individual governments’ sovereign bonds. Fail that test, as various euro-zone governments have done, and the country (and its neighbors) can be plunged into fiscal and economic crisis.

If the Federal Reserve raises the federal funds rate by another 100 basis points and continues its balance-sheet reductions at current levels, “they will crash the market,” states Larry McDonald, founder of The Bear Traps Report and author of “A Colossal Failure of Common Sense”.

A pivot may not prevent pain

McDonald expects the Federal Reserve to become concerned enough about the equity market’s reaction to its monetary tightening to “back away over the next three weeks,” announce a smaller federal funds rate increase of 0.50% in November “and then stop.”

References:

Debt is Bad

Posted on June 28, 2022 by admin

If you make the monthly minimum payment on your 14% interest rate credit card balance, it will take 25 years to payoff this debt and you will pay in interest charges more than the original amount.

You should always pay more than the minimum payment due on your credit cards, student loans and other consumer debt. As your credit card debt balance decreases, your minimum payment due will decrease and your payments will stretch out. If you make the monthly minimum payment on your 14% interest rate credit card balance, it will take 25 years to payoff this debt and you will pay in interest charges more than the original amount.

There are amazing benefits to climbing out of credit card and student loan debt. Paying off debt takes a plan and patience to execute it.

Figure out how much debt you owe. You cannot make a plan to pay off your debt until you know exactly how much you owe.
Decide what to payoff first. Best option is to pay all the minimums, but pay more money on the card with the highest APR. The “snowball” method is the most efficient approach. It’s essential for you to get started.
Negotiate down the APR. call the credit card company and ask for a lower APR. if successful, you can save a significant amount of money.
Decide where the money to pay off your credit card will come from, like balance transfer (a band aid for a larger problem, your spending habits), 401(k) or home equity one of credit (HELOC), or reducing spending to prioritize debt reduction.
Get started. The goal is action, not paralysis by analysis. Get started executing your plan and you can always find tune it later.

Being in debt means giving up choices and having reduced options; it means staying at a job you hate because it pays good money; it means not being able to build a decent savings account. It means delaying or foregoing implementing your plan to achieve financial freedom.

“Good debt is a powerful tool. But bad debt can kill you.” ~ Robert Kiyosaki

Debt can be a tool, as long as it is used to buy assets. And, statistically speaking, debt in America is normal. Only 50 percent of households reported any credit card debt, while credit card companies reported that 76 percent of households owed them money,” wrote Binyamin Appelbaum of the NYT

Seventy-five percent of Americans claim that they don’t make major purchases on their credit cards unless they can pay it off when the balance is due. Yet when looking at data of actual spending behavior, over seventy percent (70%) of Americans carry a balance.

It appears most people have no idea how much they actually owe or have any idea what their debt payoff date is.

Most people don’t get into serious credit card debt overnight. Instead, they accumulate debt little by little overtime until they realize they’ve got a serious debt problem.

Getting rid of credit card and student loan debts is hard, but very necessary to build wealth and achieve financial freedom.

Without a debt management plan, that requires knowing both the amount of debt you owe and the projected payoff date, you will more than likely be controlled by your debts.

The good news is that credit card and student loan debts are almost always manageable if you have a plan and take discipline steps to control and reduce it. You have to plan and take action paying off you credit card and student loan debts.

The number one mistake people make with their credit cards is carry a balance, or not paying it off every month. Since the key to utilizing credit cards effectively is to pay off the balance in full every month.

It is difficult for someone to achieve financial freedom if they always owe and have excessive debt.

Use credit only to purchase things of lasting value: a home, an education, maybe a car. Pay cash for everything else. To quote Knight Kiplinger, “Do you know anyone who got into big financial trouble because they didn’t borrow enough money?”

Once you’re out of the debt hole, you can avoid that predicament again, explains bankrate.com. Here are some rules to live by:

Set a budget and stick to it. Live within your means.
Avoid impulse purchases.
Shop around for the lowest price before making a big purchase.
If you use a credit card, pay off the balance each month to avoid interest charges.
Keep your finances organized and keep a close eye on your bank balances.
Stay away from “buy now, pay later” and “interest-free financing” offers, which just defer your debt.
Save money. Try to set aside a certain percentage of your income to be swept into savings.

References:

https://www.bankrate.com/personal-finance/debt/debt-consolidation-options/

Student Loan Debt Forgiveness…Shifting the Burden to American Taxpayers

Posted on June 24, 2022 by admin

Americans collectively owe more than $1.7 trillion in student loan debt, more than three times what it was just 15 years ago.

Many progressive Congressional lawmakers have called for President Biden to forgive all federally owned student loans.

Others lawmakers have argued for up to $50,000 in forgiveness per borrower.

Recent reports suggest the White House is more likely to forgive $10,000 and include an income cap that limits relief to high level borrowers. This more limited approach of forgiving $10,000 would provide relief to people who need it most while ensuring that high-earning borrowers like doctors and lawyers don’t get a bailout.

The White House has also repeatedly extended a pause on loan payments that was put in place by the Trump administration in the early days of the pandemic. That pause has included a freeze on interest, which on its own has saved the average borrower about $5,500, according to one estimate.

Why there’s debate

Supporters of student loan debt forgiveness say the enormous financial burden of loans, many with onerous interest rates, make it impossible for college graduates to get ahead.

Debt relief would directly affect around 43 million Americans. It is believed that forgiving student loan debt would free those people to spend their money on goods and services and would create significant economic benefits for everyone.

Many also argue that debt relief would help reduce racial inequality, since people of color tend to borrow significantly more than their white peers.

Opponents of student debt forgiveness say it would be unfair to the vast majority of Americans who don’t have student debt — particularly those who paid off student loans on their own. Additionally, federal student Liam debt forgiveness doesn’t erase the debt, it only shifts the burden from the borrowers to the American taxpayers, who are already burdened with the tad of inflation.

Some make the case that there are much more effective ways to reduce inequality. Others argue that it would be wasteful to forgive student debt without also taking on the much more difficult task of fixing problems in the higher education system that created the student debt crisis in the first place.

What’s next

If Biden does choose to forgive some student debt, it’s not clear whether the courts will uphold the executive branch’s authority to do so.

References:

https://finance.yahoo.com/student-loan-debt-how-much-should-biden-forgive-213848402.html

How the Economy Works by Ray Dalio

Posted on March 28, 2022 by admin

“Credit is important because it means borrowers can increase their spending. This is fundamental because one person’s spending is another person’s income.” Ray Dalio

Ray Dalio is one of most successful hedge fund managers and founder of Bridgewater Associates. He credits much of his success to guiding principles that he has used to make decisions both in his professional and in his personal life.

How the Economic Machine Works – “The economy is like a machine. At the most fundamental level it is a relatively simple machine, yet it is not well understood,” explains Ray Dalio.

Economic principles discussed:

Economy – The economy is simply the sum of all transactions repeated again and again over a long period of time. Money and credit account for the total spending in an economy.
Transactions – the exchange of money or credit between a buyer and seller for goods, services or financial assets.
Markets – “All buyers and sellers making transactions represent the market. For example, we have wheat markets, stock markets, steel markets, oil markets and so on.The combination of all of these sub-markets is the entire market, or the entire economy.” Ray Dalio
Governments – the biggest buyer and seller of goods, services and financial assets. The government consists of two parts: the central government that collect taxes and spend money; and, the central bank which controls the amount of money flowing through the economy. It does this by influencing interest rates and printing more money.
Central Bank – The Central Bank can only buy financial assets, not goods and services. To support the economy, the Central Bank buys Government bonds which gives the Central Government the ability to buy goods and service.
Price – the result of total spending / quantity sold.
Credit – Credit “is the most important part of the economy because it is the biggest and most volatile part”. Credit can be created out of thin air — in fact, in 2016, the US$50 trillion of the US$53 trillion in the economy was credit, as opposed to ‘real’ money. Credit is important because it means borrowers can increase their spending. This is fundamental because one person’s spending is another person’s income. Credit is bad when it finances over-consumption and borrowers are unable to pay the debt back.
Lenders – lend money to make more of it. When lenders believe borrowers will repay, credit is created.
Borrowers – borrowing is pulling spending forward which relates to borrowing money to buy something you can’t afford, such as a house, a car, a business or stocks. Borrowers promise to repay the amount borrowed (the principal) with interest. Borrowing creates cycles.
Debt – Debt allows you to consume more than you produce when it is acquired, and forces you to consume less when you have to pay it back. “When credit is issued it becomes debt. It’s a liability for the borrower, and an asset for the lender. It disappears when the transaction is settled.
Interest Rates – When interest rates are high, borrowing is low. When interest rates are low, borrowing is high.
Spending – one person’s spending is another person’s income. Total spending is the sum of money spent plus of credit spent.
Income – one person’s spending is another person’s income
Monetary Cycles – economy expansion and recession cycles.
Inflation – inflation is when prices rise. When spending is faster than the production of goods, it means that we have more demand than supply, which results in inflation.
Deflation – when spending decreases, prices tend to decline.
Expansion – growing markets and increasing transactions
Recession – Economic activity decreases, and if unchecked this can lead to a recession.
Bubbles – when the price of assets far exceed the value of the assets
Debt Burden – When incomes grow in relation to debt, things are kept in balance. But a debt burden emerges when debt growth exceeds income growth. This debt to income ratio is the debt burden.
Productivity – innovation and hard working raises productivity, which equates to the amount of goods and services produced.

Three rules of thumb for life

Source: Ray Dalio

According to Dalio, there are “three rules of thumb” with which to navigate the economy, be it in your own businesses, organisations you work at or your personal finances.

Don’t have debt rise faster than income (because debt burdens will eventually crush you).
Don’t have income rise faster than productivity — it will eventually render you uncompetitive.
Do all you can to raise productivity — in the long run that’s what matters most.

References:

Credit Report Information 101

Posted on March 9, 2022 by admin

Your credit history is one of the factors that lenders use to assess your creditworthiness so it is important to understand what information has been reported to your credit file.

Ancient Greek playwright Sophocles wrote, “Wisdom outweighs any wealth.” While this statement certainly rings true, it’s also true that wisdom can play a major role in building wealth—particularly when it comes to effectively managing your finances and credit.

Consumers with excellent credit scores tend to pay less for major purchases. In short, your credit is your financial calling card, it can both open and close doors. Credit reports have also become essential tools beyond the financial world. Nowadays, your housing or employment status could be decided by your credit history; and maybe even your love life.

Thus, it is important to be prepared for anything on your horizon by understanding how your credit and credit score can impact financial progress and wealth building. The three major credit reporting bureaus — TransUnion, Equifax and Experian — maintain credit reports. The reporting companies issue credit reports to creditors, insurers and others as permitted under law for the purposes of evaluating your financial responsibility.

Tablet - 3 Bureau Reports & Scores

Here is an example of how the system works:

Apply for a Credit Card – When you apply for a new credit card, the creditor requests a copy of your financial history, or credit report, from one or more of the credit reporting companies.

The Creditor’s Assessment – The creditor may use your credit report, a score, and other information you provide (such as income or debt information) to determine whether to approve your application and what rates to offer.

The Creditor’s Decision – If you are issued a card, the creditor reports that account to the credit reporting companies, and then updates it, including your balance and payment activity, about every 30 days.

Your Credit Profile Updated – The credit reporting companies update your credit report as they receive new information from creditors and lenders. Your credit profile changes based on your financial activity. The next time you apply for a credit card or loan, the process repeats.

Managing Your Credit Report

Your report is divided into six main sections. When you open a new account, miss a payment or move, these sections are updated with new information. These sections are:

Identifying Information (name, address, birth date and Social Security number)
Employment
Consumer Statement
Account Information
Public Records
Inquiries

Negative records – Late payments create a negative record. Generally, negative records will stay on your report for up to 7 years (up to 10 years for certain bankruptcy information). Positive records can remain on your credit report longer.

Your Credit Report is updated in most cases every 30 days – Your credit report is updated with new information reported by your creditors. Most creditors report new information approximately every 30 days, to reflect your account balances and payments you make.

Check every 6-12 months – Not all creditors report to all three companies; the companies obtain their data independently, so your credit reports from TransUnion, Equifax and Experian could substantially differ. That’s why it’s important to check your three credit reports every 6-12 months to ensure that the information is accurate and up-to-date.

Check Your Credit Report regualarly…checking your own credit will NOT harm it.

Correcting inaccuracies – Under the Fair Credit Reporting Act, consumers are protected if there is inaccurate information on their credit reports. If you find inaccurate information on your credit reports, you can contact the associated creditor or lender directly. You can also dispute the inaccuracy with the credit reporting companies.

Know the system – Managing your credit and maintaining a good credit history can lead to better rates on major purchases. It’s recommend that you check your credit reports every 6-12 months, or at least 3 months before a major purchase, in order to identify potential inaccuracies and any signs of identity theft.

Routine check-ups, along with paying your bills on time, keeping your credit card balances below 35% of their limits, and correcting any inaccuracies will help ensure your credit reports are viewed in the most favorable light.

Finally, if you believe you’re a victim of fraud, you can activate automatic fraud alerts and the credit bureaus will place an initial alert on your credit report. This alert encourages lenders to take extra steps to verify your identity before extending credit.

References:

https://www.creditonebank.com/articles/10-famous-quotes-about-finances-credit

Financial Freedom

Posted on January 27, 2022 by admin

“It’s the ability to live and maintain the lifestyle which you desire without having to work or rely on anyone for money.” T Harv Eker

Financial Peace guru Dave Ramsey proclaims that “Financial freedom means that you get to make life decisions without being overly stressed about the financial impact because you are prepared. You control your finances instead of being controlled by them.”

It’s about having complete control over your finances which is the fruit of hard work, sacrifice and time. And, as a result, all of that effort and planning was well worth it!

Nevertheless, reaching financial freedom may be challenging but not impossible. It also may seem complicated, but in just a straightforward calculation, you can easily estimate of how much money you’ll need to be financially free.

What is financial freedom? Financial freedom is the ability to live the remainder of your life without outside help, working if you choose, but doing so only if you desire. It’s the ability to have the things you want and need, despite any occurrence other than the most catastrophic of outside circumstance.

To calculate your Financial Freedom Number, the total amount of money required to give you a sufficient income to cover your living expenses for the rest of your life

Step 1: Calculate Your Spending

Know how much you are spending each year. If you’ve done a financial analysis (net worth and cash flow), created a budget, and monitored your cash flow, then you’re ahead.

Take your monthly budget and multiply that amount by 12. Make sure you include periodic expenses such as annual premiums and dues or quarterly bills. Also include continued monthly contributions into accounts like your emergency fund, vacation clubs, car maintenance, etc.

Add all these together to get your Yearly Spending Total.

Keep in mind the lower the spending total, the lower the amount of money you’ll need to become financially independent. Learn how to lower your monthly household expenses and determine the difference between needs and wants.

Step 2: Choose Your Safe Withdrawal Rate

The safe withdrawal rate (also referred to as SWR) is a conservative method that retirees use to determine how much money can be withdrawn from accounts each year without running out of money for the rest of their lives.

The safe withdrawal rate method instructs financially independent people to take out a small percentage between 3-4% of their investment portfolios to mitigate worst-case scenarios. This withdrawal percentage is from the Trinity Study.

The Trinity Study found the 4% rule applies through all market ups and downs. By making sure you do not withdraw more than 4% of your initial investments each year, your assets should last for the rest of your life.

Step 3: Calculate Your Financial Independence (FI) Number

Your FI number is your Yearly Spending Total divided by your Safe Withdrawal Rate.

To find the amount of money you’ll need to be financially independent, take your Yearly Spending Total and divide it by your SWR.

For example:

Yearly Spending: $40,000
Safe Withdrawal Rate: 4%

Financial Independence Number = Yearly Spending / SWR

$40,000 / 0.04 = $1,000,000

Who becomes financially free? According to most financial advisors, compulsive savers and discipline investors tend to become financially free since:

They live on and spend less they earn.
They organize their time, energy and money efficiently in ways conducive to building wealth.
They have a strong belief that gaining financial freedom and independence is far more important than displaying high social status and financial symbols.
Their parents did not keep on helping them financially.
They have a keen insight to recognize financial and wealth building opportunities.

Net worth is the most important number in personal finance and represents your financial scorecard. Your net worth includes your investments, but it also includes other assets that might not generate income for you. Net Worth can be defined to mean:

Income (earned or passive)
Savings
Investing to grow and to put your money to work for you)
Simple and more frugal lifestyle

Financial freedom means different things to different people, and different people need vastly different amounts of wealth to feel financially free.

Maybe financial freedom means being debt-free, or having more time to spend with your family, or being able to quit corporate America, or having $5,000 a month in passive income, or making enough money to work from your laptop anywhere in the world, or having enough money so you never have to work another day in your life.

Ultimately, the amount you need comes down to the life you want to live, where you want to live it, what you value, and what brings you joy. Joy is defined as a feeling of great pleasure and happiness caused by something exceptionally good, satisfying, or delightful—aka “The Good Life.”

It is worth clearly articulating what the different levels of financial freedom mean. Grant Sabatier’s book, Financial Freedom: A Proven Path to All the Money You’ll Ever Need, the levels of financial freedom are:

Seven Levels of Financial Freedom

Clarity, when you figure out where you are financially (net worth and cash flow) and where you want to go
Self-sufficiency, when you earn enough money to cover your expenses
Breathing room, when you escape living paycheck to paycheck
Stability, when you have six months of living expenses saved and bad debt, like credit card debt, repaid
Flexibility, when you have at least two years of living expenses invested
Financial independence, when you can live off the income generated by your investments and work becomes optional
Abundant wealth, when you have more money than you’ll ever need

The difference between income and wealth: Wealth is accumulated assets, cash, stocks, bonds, real estate investments, and they have passive income. Simply, they don’t have to work if they don’t want to.

Accumulating wealth and becoming wealthy requires knowing what you want, discipline, taking responsibility and have a plan.

Hundreds of thousands of Americans have great incomes, but you wouldn’t call them wealthy because of debt and lack of accumulated assets, instead:

They owe for their homes
They owe for their cars and boats.
They have little savings and investments
They have few “paid for” assets
They have negative net worth

Essentially, if you make a great income and spend it all, you will not become wealthy. Often, high income earners’ true net worth is far less than they think it is.

Here are several factors and steps to improve your financial life:

Establishing financial goals
Paying yourself first and automate the process
Creating and sticking to a budget. Know where you money goes.
Paying down and/or eliminating credit card and other bad debt. Debt which is taking from your future to pay for your past.
Saving for the future and investing for the long term consistently
Investing the maximum in your employer’s 401(k)
Living on and spending less than you earn
Simplify – separating your needs from your wants. You don’t need to keep buying stuff.

Financial freedom can look something like this:

Freedom to choose a career you love without worrying about money
Freedom to take a luxury vacation every year without it straining your budget
Freedom to pay cash for a new boat
Freedom to respond to the needs of others with outrageous generosity
Freedom to retire a whole decade early

When you have financial freedom, you have options.

“Your worth consists in what you are and not in what you have. What you are will show in what you do.” Thomas Edison

References:

Historic Inflation Worries Americans

Posted on December 13, 2021 by admin

Worries by Americans over historic inflation level and higher retail prices are now larger than concerns about the coronavirus pandemic, according to recent polls from Monmouth and AP-NORC.

The U.S. consumer price index rose 0.8% in November from October. The Labor Department said consumer prices grew last month at an annual rate of 6.8%, which is the highest in 39 years since President Carter administration. The growth in prices were led by cars, food, gasoline, electricity and fuel oil.

As the bulk of Americans cite inflation and paying their bills as their top concerns, President Joe Biden’s job approval ratings fell to new lows with 69% disapproving of how he is handling inflation, according to an ABC/Ipsos poll.

Additionally, inflation concerns could potentially cost the President and Democrats’ their coveted social and environment legislation. It is believed that adding additional fiscal spending to already exploding government debt that adds juice to the economy might worsen inflation critics assert.

Most economists agree that the Build Back Better bill would add to inflationary pressures in the short run, however, they differed over its effects on inflation over the long term. Furthermore, most economists see inflation coming down sometime next year, but the debate is over how soon and by how much.

The bill will probably increase demand over the next few years, Harvard University professor Doug Elmendorf said. “That will tend to push up GDP and employment and inflation — which is not the policy impulse we need right now,” he added. Elmendorf served in the administration of former Democratic President Bill Clinton

References:

Brownlee Global – Wealth Building, Healthy Living, and Emotional Well-Being with Purpose

Guide and Educate Individuals How to Build Long-Term Wealth, Better Manage Their Money, and Achieve Financial Freedom

Tag Archives: Debt

U.S. Federal Public Debt

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Federal Fiscal Deficit vs. National Debt

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More Than One in Four Americans Say Their Debt is Unmanageable

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World in Love with Debt

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Debt is Bad

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Student Loan Debt Forgiveness…Shifting the Burden to American Taxpayers

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How the Economy Works by Ray Dalio

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Credit Report Information 101

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Financial Freedom

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Historic Inflation Worries Americans

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