The link above will provide you with eight significant ways to reduce your 2009 tax burden.
For taxpayers who incurred losses in 2009, the article provides ways to quickly monetize these losses via obtaining refunds through carryback of the losses for up to five years.
More information can be obtained at www.blakechristian.com and www.hcvt.com.
Whether Dubai World’s technical default on $60B of debt will have a deep and lasting impact on world markets and commercial real estate values will take some time to sort out.
But it is safe to say that last week’s revelation that the shining star in the oil-rich Middle East has major cash flow issues will cast a long shadow on the credit markets and stock market for the next few months.
Read the Financial Times Article:http://www.ft.com/cms/s/3/fe4b634e-dd14-11de-ad60-00144feabdc0.html
We all seem to enjoy second-guessing other people’s decisions – particularly if it involves any decision by Congress or Presidents Bush or Obama in the last few years.
Well now a group of CEOs, representing millions of workers and over $2 trillion of combined market capitalization, had that opportunity to make their opinions known to the business community, as well as the Obama Administration and Congress (assuming they are still open to input from us pesky voters).
Last week the Wall Street Journal gathered 100 CEO’s from a cross-section of large cap companies. The purpose of this CEO Council was to develop a consensus on how the Obama Administration should prioritize their national and global agendas for the good of the economy and the good of the country.
According to WSJ.com: “The CEOs divided into four task forces and debated priorities in the areas of health care, energy and the environment, finance and the U.S. economy, and education. Using an electronic ranking system devised by the Journal, they chose five top priorities in each subject area.”
The summarized priorities are accessible at the link below:
http://online.wsj.com/article/SB10001424052748704204304574543633148686184.html
The full CEO Council reports and a list of CEO Council participant can be accessed at:
Wyoming, Iowa and Nebraska may not be on the top of your list of ideal places to retire, but based on a recent PEW Center report on the financial well-being of state governments, these three states topped the list of being the most fiscally sound.
The top three states to avoid in retirement include states that are often near the top of future retirees’ lists, including: California, Arizona and Rhode Island (note that popular retirement haven Florida ranked 7th worst).
So do your homework before you make the plunge into retirement.
More details can be found in the linked U.S. News & World Report Article:
Wednesday, October 18th
Senate Version of Healthcare Bill Drops to $849 Billion – what a deal!
Politico.com Executive Summary – .5% increase in lockbox Medicare Hospital Insurance Tax payroll tax for taxpayers making more than $200,000 (for single taxpayers) and $250,000 (for married couples):
http://www.politico.com/livepulse/1109/Senate_bill_summary.html
Christian Science Monitor Article:
Sunday, October 8th, 11.30 p.m. PST Updates
Chinese Less Than Thrilled With House Healthcare Package
Chinese Premier Wen Jiabao on Sunday exhorted the U.S. to keep its deficit in control to stabilize the U.S. dollar exchange-rate, according to media reports.
“I hope that as the largest economy in the world and an issuing country of a major reserve currency the United States will effectively discharge its responsibilities,” Wen said at a news conference in Egypt, according to wire reports.
China is the largest foreign holder of U.S. Treasurys.
Earlier this year, Chinese officials expressed concern about the continued value of those holdings as the U.S. pumps trillions of dollars into the financial system to pull the economy out of a severe recession. The U.S. Treasury has been issuing record amounts of debt to close the country’s budget gap.
“Most importantly, we hope the U.S. will keep its deficit at an appropriate size so that there will be basic stability in the exchange rate and that is conducive to the stability and recovery of the world economy,” he said.
Bloomberg House-Senate Summary:
http://www.bloomberg.com/apps/news?pid=20601087&sid=aJU5kC3UDPaw&pos=8
Associated Press Article:
http://finance.yahoo.com/news/House-Senate-health-care-apf-3314142498.html?x=0&.v=4
U.S. Chamber of Commerce Perspective:
http://www.uschamber.com/issues/index/health/default
http://www.truthout.org/1005091
Heritage Foundation Perspective, including various underlying cost studies:
http://www.heritage.org/Research/Healthcare/wm2114.cfm
Update Saturday, November 7th 8:30 p.m.
Earlier this hour, the House passed H.R. 3962 – House version of the nearly 2,000 page/ $1.2 Billion healthcare reform package by a very slim 220 – 215 margin – with only a single Republican from Louisiana (Cao) supporting the package – and that vote was curiously only cast after the 218 vote threshold for passage was met.
The Conference Committee and Senate debate will shine a brighter light on the specific provisions which have been shoehorned into this bloated monstrosity.
This morning President Obama encouraged the Representatives to stand firm and effectively ignore their constituents back home. The coming weeks will be very telling as to how home district voters will take being ignored by their representatives.
Click on the Huffington Post link below for the evolving details of this historic bill:
http://www.huffingtonpost.com/2009/11/07/health-care-vote-latest-u_n_349454.html
Earlier Post:
As Congress pushes forward with their $1.2 TRILLION (that’s 1,200 BILLION Dollars for you non-mathematician) healthcare package, it is important to understand how the House and Senate versions will impact businesses, doctors, patients and taxpayers.
The attached side-by-side comparison will provide you with a helpful overview of the projected impact of both versions of the current bills (which are changing hourly).
http://www.kff.org/healthreform/sidebyside.cfm
Republican proposal provides lower-cost alternative:
http://www.gop.gov/solutions/healthcare
Read about the 5.4% surtax payable by higher income taxpayers:
Call your representatives NOW to let them know your thoughts.
Last week the Administration announced their revised figure for jobs “created” and “saved” as a result of the $787 billion federal stimulus package approved earlier this year.
As reflected in the New York Times article linked below, over half of the 640,000 saved or created jobs cited by the government have been in the education sector. Only 80,000 jobs are tied to construction – which was originally the centerpiece of the stimulus package – but that portion of the spending was ultimately whittled down to only about 15% of the total package – so the job output is in that same range.
http://www.nytimes.com/2009/10/31/us/31stimulus.html
The ongoing controversy is how the government is defining and measuring “saved” and “created” jobs. From the point in time that the Administration promised that the stimulus plan would save or create 3 million jobs, taxpayers and economists have asked for details as to how this will be measured. For now it is a moving target with vague explanations.
California, New York and Washington had the highest number of jobs created or saved. For additional details regarding the state-by-state and sector-by-sector job results thus far, check out the government website below:
http://www.recovery.gov/Pages/home.aspx
On Monday November 2nd, President Obama attempted to temper the expectations regarding job growth by stating that job losses will continue for the next weeks and months and pressed the public and private sectors to become more creative to increase hiring.
Stay tuned……
As part of the 2009 tax stimulus plan, congress approved three types of financing tools which offer investors tax-effective investment returns, and/or reduced financing costs for the issuer of the bonds.
The tax credit bonds include tax credits which can be used to offset both “regular” federal income tax as well as federal alternative minimum tax (AMT).
Since the credit earned is 35% of the interest income received, taxpayers in the AMT, or taxpayers in marginal tax rates lower than 35% will generally obtain even greater benefits.
Develelopers, government agencies and construction companies view Build America Bonds as a very effective financing tool.
Despite a recent minor rally against some major foreign currencies, the U. S. dollar is under mounting pressure around the world, and has lost its luster and “safe harbor” monetary status.
Following are some interesting articles regarding the weakening dollar, record gold prices and various predictions regarding international implications of both.
Lazard Asset Management switches share value from U.S. Dollar to Pound Sterling:
Gold vs. NADAQ
“Call me cynical if you wish, but I believe a one or two ounces of a shiny metal will be equal in value to the entire Dow Jones Industrial Average before this bust is over. It happened in the 1930s and it happened in the 1970s, both during the context of secular bear markets in stocks like the one we are smack dab in the middle of right now.”
http://www.kitco.com/ind/Brochert/oct132009.html
Silver Shines Brighter Than Gold in 2009
Oil vs. Gold
In summary, gold and silver prices should be monitored by every skittish investor and should be considered as hedge for at least a portion of their longer term portfolio. Foreign stocks, securities and currencies may also be attractive if the dollar continues to fall.
As the second Stimulus Plan weaves through Congress, scrutiny is mounting regarding the specifics of the plan and which regions and industries will derive any benefit from the proposed $888 billion infusion.
Infrastructure Projects - Excellent Idea — if Executed Properly
While infrastructure projects are a cornerstone of this Stimulus Plan, careful monitoring of bidding processes, budgeting, and implementation of these large projects to ensure that the benefits are equitably spread to the communities and residents in the hardest hit regions.
The most cost effective way to allocate these contracts while ensuring that local residents are properly represented on the projects is to require that a minimum percentage (say 20%) of contracts/ sub-contracts are set aside for small businesses headquartered in the infrastructure city or county. In addition, both union and non-union contractors should be required to employ at least 25% of local residents. In addition to improving the stimulative effect, this strategy will reduce pollution and should also streamline the local approval process, since job creation and retention are the clear focus of municipalities.
Download Reduce Emissions article 12.2007
Download Long Beach Press-Telegram 2009 Infrastructure Op-Ed
Obama's Stimulus Package -Will the Democratic Bill Morph into a Bi-Partisan Bill?
Updates on the proposed Obama Stimulus Plan, and the list of financial institutions that have received federal infusions thus far are reflected below.
http://royce.house.gov/News/DocumentSingle.aspx?DocumentID=109713 Congressman Royce Comments
http://online.wsj.com/public/resources/documents/st_BANKMONEY_20081027.html TARP Recipients
http://www.webcpa.com/article.cfm?ARTICLEID=30588 House Passes Package
http://www.webcpa.com/article.cfm?ARTICLEID=30584 Senate Tax Breaks
2009 – Continuing Economic Chaos?
Looking forward into 2009, the stock market and money markets have some real challenges. Read what local economists Clyde Kendzierski and Bill Gross and JP Morgan have to say about 2009.
Download Clyde Kendzierski 2009 Economic Forecast
Download Bill Gross – Big Brother Investing (2)
Download Nouriel Roubini (NYU Professor) 2009 Economic Forecast
Download JP Morgan on Money Fund Risks
Hopefully the Senate will refine the Stimulus Package to make it smaller and more effective. A slower, more thorough evaluation process in the Senate should result in a better package for the U.S. economy, U.S. taxpayers, as well as the worldwide financial markets.
Download Long Beach Press-Telegram 2009 Infrastructure Op-Ed
Download 2008-dec-skyrocketing-unemployment-lbics-1
Download 2009 LB Magazine Investment Strategies
Download 2008 FDIC Insurance Coverage
Download 2008 SEC Money Market Guarantee
http://www.sec.gov/answers/investoralert.htm
Infrastructure and Employment
Infrastructure projects are at the top of national, state and local agendas as the best way to stimulate the economy and reverse the spiraling unemployment trends. There is a clear need for infrastructure investment; however,to maximize the stimulus effect and minimize the taxpayers' cost of these projects, legislators need to carefully allocate and monitor the underlying construction contracts.
Bank Account Insurance and Money Market Guarantees
With the continuing banking and stock market uncertainties, businesses and personal investors are wise to exercise extreme caution and diversification of their investment and banking relationships. Concentration of either interest-bearing or non-interest bearing accounts in any one bank – or even in multiple banks for taxpayers with large cash balances, may be regretted in coming months.
Money market funds and both corporate and tax-exempt bond portfolios should also be re-examined by a bond expert for both default risks and interest rate/ market risks when rates increase in the future.
While municipal bonds may be viewed as reasonably safe by many experts, many state and local governments are also facing unprecedented revenue and cost challenges and higher cost of financing as a result of the faltering economy, which may add to risk on many outstanding bonds. Therefore, extra care should be factored into the review of this part of your portfolio.
See other Blog entries below as well as a variety of articles in the "Library" section of this site.
