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Slick TV ads often make financial planning and wealth management sound simple, but it’s usually not. Managing wealth requires knowing a lot about highly technical topics, like taxes, government regulations, and finance as well as history, psychology and how to communicate with loved ones about sensitive issues. This article highlights some of the knowledge needed to manage wealth and why it’s often so daunting without the help of an independent personal financial advisor who is familiar with your situation.
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Understanding The Federal Reserve Mandate To End Inflation
The Federal Reserve System, the nation’s central bank, has a dual mandate to pursue maximum employment and maintain price stability. These two priorities are currently treated equally, but that was not always the case. In fact, the Fed’s bias toward maximizing employment was a critical driver of the stagflation that plagued the U.S. in the late 1960s and 1970s. Recognizing the need to balance price stability and maximum employment, in 1977, Congress revised the Federal Reserve Act.
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Fed Governor Kugler Details Inflation And Economic Outlook
The 12-month inflation rate, as measured by the personal consumption expenditures (PCE) index, was 2.6% in December, down from its peak of 7.1% in June 2022, and the six-month rate for PCE inflation was even lower, at 2%, which is the target rate set by the Federal Reserve.
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Why Rates May Not Be Cut Until June
The cost of a loan to buy a home, car, college education, and achieve the American Dream is staying the same for now. As expected, Federal Reserve Chairman Jerome Powell said the central bank did not lower loan rates following the Fed’s Wednesday, Jan. 31, 2024, policy meeting.
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Practical Suggestions For Achieving Your 2024 Resolutions
New Year’s resolutions usually fail because they‘re often too hard to achieve. After six months, only 10% of people who make resolutions achieve them or remain committed to them, , according to a study by Dr. Mark Griffiths, a Chartered Psychologist and Distinguished Professor of Behavioral Addiction at the Nottingham Trent University. What can you do to make financial, medical, or other personal resolutions more likely to be achieved?
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A Sign Of Progress In Solving U.S. Economic Problems
The Federal Reserve appears to be pulling off a feat most experts did not believe it could: ending its aggressive inflation-fighting campaign of 11 interest rate hikes without tipping the U.S. economy into a recession.
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Fed Keeps Rates Unchanged; Expects Easing In 2024
To promote transparency and free markets, the Federal Reserve System began publishing the opinions of the 19 U.S. central bankers that decide interest rate policy.
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Have You Logged Into Your Social Security Account?
Have you logged in to your Social Security account? Creating an online account at SSA.gov is an important first step in understanding your retirement income situation. However, only about 60 million of the 160 million individuals in the U.S. labor force who have Social Security accounts have created a way to access the Social Security Administration’s website.
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The Great Fake Out Of 2023 Is Poised To Extend Into 2024
All year long, the economy and stock prices have fooled experts and consumers, outperforming expectations month after month.
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Test Your Financial Planning IQ
The five questions below are a challenge meant to allow you to assess your knowledge of investing, tax and financial planning. If you have been following our news stream, this quiz draws on familiar ground. The answers are below.
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Planning Briefs
Amid The Awful News, Some Good Signs
Published May 13, 2020, 4 p.m. ET
(May 13, 2020, 4 p.m. ET) During this bleak period in world history, amid the terrible news of death, sickness and financial destruction, there are reasons for hope and promising signs of a U.S. recovery from the Covid-19 pandemic.
After the Standard & Poor's 500 stock index bottomed on March 23, 2020, it soared more than 20%. The March 23 low coincided with the release of details on the $2.2 trillion Coronavirus Aid, Relief, and. Economic Security (CARES) Act. The Act was signed into law March 27, 2020. This swift action by the U.S. Government likely prevented an economic calamity that would have been far worse.
The CARES Act allocated $454 billion to Federal Reserve Bank Special Purpose Vehicles that the central bank can leverage 10 to 1, thereby enabling it to lend up to $4.54 trillion to companies in financial distress. The Fed funding vehicle was unprecedented in size and represents an historic moment within the annals of modern central bank intervention. Never before in a crisis has any nation's central bank flexed its financial muscle in this way. The U.S. has expanded the power of its sovereignty, placing a new and unprecedented type of safety net in position to cushion the economic fall from the almost complete shutdown of the economy.
In a speech today, Fed Chairman Jerome Powell warned that without more relief from Congress and continued Fed loans to aid ailing industry sectors and promote further liquidity, the risk of long-term damage to the economy would remain heightened. "At the Fed," said Mr. Powell, "we will continue to use our tools to their fullest until the crisis has passed and the economic recovery is well under way." His frank remarks show the Fed is prepared to meet the crisis by playing a larger role in managing the economy than perhaps any other central bank in world history.
"The recovery may take some time to gather momentum, and the passage of time can turn liquidity problems into solvency problems," Mr. Powell said. "Additional fiscal support could be costly, but worth it if it helps avoid long-term economic damage and leaves us with a stronger recovery."
Although past performance is not a guarantee of future results, the chart illustrated above shows the stock market bottomed three to six months before the end of each recession since 1957, another hopeful sign.
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