Friday, May 4, 2018

What have you done with your Trump tax cuts?

What have you done with your Trump tax cuts?
We were promised to see immediate effects of the cut in rates as early as Feb. May is a good time to take stock of what happens to this strategy called ‘trickle down’ economics. The idea created in the Robber Barron period is that if you work for a company that now has a lot fewer taxes, they will 1) give you a raise, 2) create more jobs by expanding their business, and 3) more profits mean more government revenue to pay for the tax cuts enjoyed by the wealthy and business owners. One GOP rep is not drinking the Cool-aide. “There is still a lot of thinking on the right that if big corporations are happy, they’re going to take the money they’re saving and reinvest it in American workers,” the Florida senator told the Economist in a recent interview. “In fact they bought back shares, a few gave out bonuses; there’s no evidence whatsoever that the money’s been massively poured back into the American worker.” We were supposed to get $4,000. Seen it yet? Elections are coming up and we better see it soon or this will again prove the B.S.

Have you done due diligence on your securities lately
Your broker has until Jun 12 to reimburse you for overcharges on funds they sold you. Costs for many mutual funds have fallen dramatically as assets flowed from expensive funds to lower-cost funds, according to Morningstar, "This trend toward lower-cost funds should have an exponentially positive impact on investors' returns in the future because costs compound over time and eat into investors' nest eggs," said an analyst. "Our data shows that the cheapest 20 percent of funds raked in nearly $1 trillion last year while the rest of the industry saw net outflows of approximately $250 billion. The message investors are sending is crystal clear—cost counts." The average fees paid by investors for passive funds fell to 0.15%. The average expense ratio for active funds dropped to 0.72%. Vanguard has shown growth to over $5 Trillion as the low cost leader. Investors can give up over 63% of their assets to fees over a lifetime. Check your fees:

Can ‘options trading’ really provide ‘consistent profits’?
There are many sales organizations that claim you can make money by betting on the activity of one stock or financial indicators like a market index. Your first question is if they are so successful why are they trying to sell me this book or program or course? Essentially you are betting that they know the price of a stock or index will go up or down by a certain date or amount. For some people, gambling is exciting and fun. Sure, there are some gamblers who win so these organizations can claim these stock and option trading strategies “help you invest with a high rate of return minimizing risk.” But when you read the mouse type at the bottom of the ad, beware of the “potential for substantial loses.” Actually, ‘consistent profits’ come from compounding of dividends and gains of profitable companies over time. As Buffett has explained, holding an index will beat most professional money managers. One index has provided 11% for 30 years.

Trump’s regulator says we can’t expect advisors to act in our ‘best interest’
SEC chair Jay Clayton told lawmakers that investors mistakenly believe they have a legal right to conflict-free advice. It may be impossible for regulations to protect us from scams given the fact that the overwhelming majority of scams against investors are perpetrated by brokerage salespeople, according to SEC Commissioner Kara Stein. The industry is a sales industry and so it is almost impossible for us to expect unbiased advice regarding financials. Like a doctor receiving gifts for advising certain drugs or lawyers advising certain legal papers or actions, advisors can’t act in our ‘best interests.’ The only way we can know what is best for us to do research and use the advice of experienced people who have no way to make money from us. Three states want advisors to be held to a higher standard—what is best for us.
Use firms that follow “best interest” rules:

Is the ‘CD ladder’ strategy really effective?
When interest rates rise, how effective is this strategy in capturing more interest? Well, it comes down to how much rates will rise and how much principal you have to work with. CD laddering assumes that if you lock in a rate for 5 years that you are stuck with lower rates over time and you don’t have access to your money more often. If you buy 1, 2, 3, 4, 5 year CDs with equal portions of your CD money, you get to buy another 5 year with higher rates after each one matures. You gain more over time than if you hold and renew a single term CD. EG: May 1: 5 yr 2.75%, 4 yr 2.6%, 3 yr 2.5%, 2 yr 2.35%, 1 yr 2.1%, Inflation 2%. Next year buy 5 yr 2.8%? 2020 by 5 yr 2.85%, etc. Your alternative may be a low-cost bond fund that owns 70% government bonds of all maturities currently yielding 2.94% like Vanguard Total Bond or ladder higher paying low-cost annuities.

New ways the Trump’s GOP gave the wealthy to avoid their fair share of taxes
Legal experts have found new loopholes to help their rich clients. One of the largest benefits is for film producers like his friend Treasury Sec Mnuchin (Mad Max: Fury Road), who can now deduct ALL his expenses as soon as the film is released instead of over time. A smaller but important one is a home trust. Even average home owners with high property taxes in NY NJ CA CT cannot deduct their $15-25,000 taxes in 2018. However, putting the property in a trust can beat the new law. A wealthy client in a high-tax state might conceivably bypass the SALT limitation by putting ownership of a residence into bifurcated non-grantor trusts. A bonus: Trusts don’t need to file tax returns. There could also be an income tax benefit for children. Beware sale gains.

Where can you invest if your 401k fees are eating up your gains?
Employees had to sue American Airlines to obtain their retirement earnings back. Others have sued for lost accounts, high fees, overcharging for bookkeeping, kickbacks to the employer, and poor performing investment options. This situation can take up to 63% of your potential nest egg over time. If you just got hired, there are better ways to save for retirement. You can accomplish the same tax-deferred investing while maximizing your earnings by opening a self-directed IRA at one of the low-cost mutual fund firms. Vanguard and TIAA are not for profit—you earn more and pay less. Use passive and active funds run by professionals. Get advisor help when you need it.


Make America, “The Don” Great Again

(Dictators often have delusion they themselves ARE their country)

Treason definition: ‘giving them aid and comfort within the United States

Putin controls US power utilities and 21 state voting files, Trump slush fund, etc

The election is going to be rigged—I’m going to be ‘honest’” 
GOP voter suppression a success: Dems lost because poor don’t have new ID.

Could Trump postpone Nov 2018 election using excuse of Putin meddling needs fixing?


EPA allows poisons in Houston water—no testing wells or fish—cancers spike?

Trump believes that he does not need to answer Mueller questions. Is that legal?
Trump to force CA to INCREASE smog by canceling regs on emissions.
Beware money transfer mobile apps like Zelle
NRA bans guns at annual meeting—NRA really does understand guns kill people
LPL Financial caught selling illegal securities to customers who get money back
Beware: the popular scams our government can’t stop—send poor to jail for weed.
Tonya Lynn Adkism, Houston, caught stealing $1 million from NFL Meachem.

Pence as Prez: he lies just like Trump so Dems can forget impeachment of The Don

Who owns your account now?

Can we trust Ari Melber to explain the legal case against POTUS?

Waffle House hero raises money for victims—police can think of James when fear blacks

American democracy in post-TRUTH world? Can we survive with Facebook, Fox news?

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