The Long Term Investor

Of course.....this and the queen......were the big news today.

Fed Chair Powell vows to raise rates to fight inflation ‘until the job is done’

https://www.cnbc.com/2022/09/08/fed...to-fight-inflation-until-the-job-is-done.html

(BOLD is my opinion OR what I consider important content)

"Key Points

• Federal Reserve Chair Jerome Powell said Thursday he is “strongly committed” to fighting inflation.
• The Fed has raised benchmark interest rates four times this year, with the fed funds rate now set in a range between 2.25%-2.50%.
• This was the Fed chief’s last publicly scheduled appearance before the central bank’s Sept. 20-21 meeting.

The Fed needs to move ‘forthrightly, strongly’ against inflation, says Fed Chair Jerome Powell

Federal Reserve Chair Jerome Powell in an appearance Thursday emphasized the importance of getting inflation down now before the public gets too used to higher prices and comes to expect them as the norm.

In his latest comments underlining his commitment to the inflation fight, Powell said expectations play an important role and were a critical reason why inflation was so persistent in the 1970s and ’80s.

“History cautions strongly against prematurely loosening policy,” the central bank leader said in a Q&A presented by the Cato Institute, a libertarian think tank based in Washington, D.C. “I can assure you that my colleagues and I are strongly committed to this project and we will keep at it until the job is done.”

The event was Powell’s last scheduled public appearance before the Fed’s next meeting on Sept. 20-21.

Markets largely took the comments in stride, with major averages little changed in the early going on Wall Street. Treasury yields were mostly higher, with the two-year note, the most sensitive to Fed rate hikes, rising by nearly five basis points to 3.49%. A basis point equals 0.01 percentage point.

The Fed has raised benchmark interest rates four times this year, with the fed funds rate now set in a range between 2.25%-2.50%.

Markets widely expect the rate-setting Federal Open Market Committee to enact a third consecutive 0.75 percentage point increase this month. In fact, that probability rose to 86% during Powell’s remarks, according to the CME Group’s FedWatch tracker of fed funds futures bets. Both Goldman Sachs and Bank of America told clients to expect that three-quarter point hike.

One reason for acting aggressively is to make sure that inflation running around its highest rate in more than 40 years doesn’t become ingrained in the public consciousness, Powell said.

“The Fed has the responsibility for price stability, by which we mean 2% inflation over time,” he said. “The longer inflation remains well above target, the greater the risk the public does begin to see higher inflation as the norm, and that has the capacity to raise the costs of getting inflation down.”

There have been some signs lately that at least the monthly path of inflation is abating. In particular, gasoline prices have been falling steadily after briefly rising above $5 a gallon earlier in the summer.

The Fed gets its last look at inflation data before the meeting next week, when the Bureau of Labor Statistics releases the August consumer price index data. Economists are expecting a 0.2% headline increase in the CPI after it was flat in July, according to FactSet. However, the year-over-year increase in July was 8.5%, and many areas outside energy saw sizable increases.

Powell said the inflation pressures have come largely from pandemic-specific causes. When inflation first began to rise in the spring of 2021, Powell and his colleagues dismissed it as “transitory” and did not respond with any major policy moves before starting to hike rates in March 2022.

However, he said it’s incumbent now on the Fed to keep acting until inflation falls and avoid the consequences of the 1970s when a failure to implement an aggressive policy response allowed public expectations for high inflation to fester.

“We need to act now, forthrightly, strongly, as we have been, and we need to keep at it until the job is done to avoid that,” he said.

Powell noted the strong labor market, with robust levels of hiring persisting despite the rate increases, even as Fed officials expect the official unemployment rate to drift higher. He warned last month that the economy could experience “some pain” from tighter policy but said slowing growth is necessary to tame inflation.

“What we hope to achieve is a period of growth below trend which will cause the labor market to get back into better balance and that will bring wages back down to levels that are more consistent with 2% inflation over time,” he said."

MY COMMENT

Once again.....is there anyone in the world that does not already know the above? I doubt it.

I also have strong doubts that anything the FED does will make any impact or difference at all. Sure they will probably crash the economy.....they always do. AND.....they will keep raising rates.

BUT.....most of what we are experiencing now has nothing to do with the FED or anything they can control. We are STILL.....after all this time....trying to fix and cope with a severely disrupted world economy due to the moronic economic shut downs that were allowed to FESTER for nearly 2 years.

 

Agree Tom. Those of us that are old enough remember when NORMAL inflation and a healthy economy was considered to be about 3-4% inflation. The 2% target is ridiculous.....it is borderline DEFLATION.

There is NO magic number for inflation and the FED has no particular expertise to determine what is healthy for the economy and business.

 

We are seeing a VERY NICE open to the day today. ALL the averages are UP big at the moment. We need the markets to end strong today so we can end this three week negative streak.

I have been siting and watching since before the open. Looks good to me.

 

HERE is a nice little article about all the various types of IRA accounts that are available to business and individuals. Any realistic financial plan today MUST include either a 401K, an IRA, or a government pension. If you dont work for the government.......either a 401K or an IRA of some sort is ABSOLUTELY NECESSARY. Obviously......the most important sort of retirement plan for EVERYONE......is those that include some sort of employer match.

What Are the Types of IRAs?
Learn about how different retirement accounts work to find one that is the best match.

https://money.usnews.com/money/retirement/iras/articles/what-are-the-types-of-iras

No one else is going to take care of your retirement if you dont work for the government. If you have not set up one of these plans or a 401K.....MAKE A COMMITMENT.....to start this year.

 

Here is the short term market view for today.

Stock market news live updates: Stocks extend gains into third day, oil rises

https://finance.yahoo.com/news/stock-market-news-live-updates-september-9-2022-111216023.html

(BOLD is my opinion OR what I consider important content)

"U.S. stocks rallied at the start of trading Friday as Wall Street looked to snap a three-week losing streak.

The S&P 500 rose 0.9%, building on back-to-back sessions of gains, while the Dow Jones Industrial Average jumped 200 points, or about 0.7%. Technology stocks led the way up, with the Nasdaq Composite climbing 1.4%.

Oil extended a volatile run as prices resumed their climb Friday morning. West Texas Intermediate (WTI) and Brent crude oil futures each rose 2.8% to $85.88 per barrel and $91.66 per barrel, respectively.

In a stark warning to the West on Friday, Russia said efforts to place price caps on the country’s oil and gas exports in sanctioning Russia for its war in Ukraine would fail and “lead to a slippery floor under its own feet.”

Meanwhile in cryptocurrency markets, Bitcoin (BTC-USD) teetered above $21,000, just one day after sliding below $19,000. The coin's rally buoyed shares of crypto stocks, including Coinbaise (COIN) — up more than 6% — and MicroStrategy (MSTR) — climbing more than 7%.

Investors continued to mull remarks made by Federal Reserve Chair Powell at the Cato Institute’s 40th Annual Monetary Conference in Washington D.C. on Thursday.

“The Fed has, and accepts, responsibility for price stability,” Powell said, again affirming the U.S. central bank’s commitment to mitigating inflation. “We need to act right now — forthrightly, strongly.”

Wall Street is anticipating with increasing certainty that Fed officials will deliver a third consecutive rate hike of 0.75% later this month, with a flurry of institutions raising expectations for the magnitude of increases on the Fed’s benchmark policy rate.

Bank of America, Goldman Sachs, and Nomura have all lifted their forecasts through year end.

“In our view, unchanged guidance about when the pace of rate hikes may slow suggests that Chair Powell and the Fed are comfortable with current market pricing,” BofA economists said.

Elsewhere in markets, shares of DocuSign (DOCU) rallied 10% after the company reported better-than-expected second-quarter earnings late Thursday and raised its subscription revenue guidance for the year.

Zumiez (ZUMZ) shares sank more than 3% after the retailer posted disappointing Q2 results and downwardly revised its third-quarter sales guidance. CEO Rick Brooks said “inflation weighed on consumer discretionary spending,” putting pressure on the company’s U.S. business."

MY COMMENT

One thing that is very obvious in the above.......there is ABSOLUTELY NOTHING new going on right now. Every issue has been known and priced into the markets for many, many, months now.

ALL the day to day market action that we see in the short term....especially the big down days......is simply trading manipulation based on headlines and other phrases in news items that are piled onto by AI Trading programs.

If we can end the week today with BIG GAINS.....and a positive week......we will have finally broken the back of the negativity that we have been floundering in for the past few weeks.

 

Looks like it is just not my........PARANOIA.....that the FED is intentionally kicking stock investors in the teeth by jawboning the markets down. Of course....this little article does not prove anything.....but at least I am not alone in thinking that the FED is INTENTIONALLY targeting investors and stock holders with their rhetoric and media appearances.

Why the Fed wants to see a strong dollar and falling stock prices: Morning Brief

https://finance.yahoo.com/news/fed-strong-dollar-falling-stock-prices-morning-brief-093242900.html

(BOLD is my opinion OR what I consider important content)


"The Nasdaq Composite (^IXIC) notched a 2.1% gain Wednesday, ending a seven-day losing stretch that had been frustrating the buy-the-dip crowd once again.

Problem is, surging stocks are the last thing the Federal Reserve wants to see.

Sudden reversals of fortune — both to the upside and downside — are common in illiquid bear markets.

But Wednesday's rally flies in the face of a Federal Reserve doubling (or tripling) down on its steely resolve to curb runaway price inflation.

On Wednesday before the opening bell, a report from the Wall Street Journal's top Fed whisperer Nick Timiraos caught investors' attention, with the report suggesting another 75 basis point rate hike will be coming from the central bank later this month.

This move would mark a continuation of the Fed's summer gambit to confront inflation by tamping down anything that stands in that fight's way. Which in this case means tightening financial conditions.

The simple outline of tighter financial conditions is a stronger U.S. dollar, wider spreads across bond markets, and lower stock prices. Trigger-happy equity bulls should read that sentence again, as they remain, de facto,fighting the Fed.

All else equal, tighter financial conditions require investors and consumers to be more deliberate about where and how they spend and borrow.

In late August, when Fed Chair Jay Powell delivered a blunt speech in Jackson Hole, telling investors the Fed will raise rates "until the job is done" bringing inflation down, markets sold-off. Message received. Financial conditions tighter.

Minneapolis Fed president Neel Kashkari made waves last week when he acknowledged preferring this market reaction to what was seen after the Fed's July FOMC meeting. Which was a market rally that saw the S&P 500 gain 2.6% and the Nasdaq rise more than 4%.

“I certainly was not excited to see the stock market rallying after our last Federal Open Market Committee meeting," Kashkari told Bloomberg in an interview.

And while the Fed does have a third "shadow mandate" of financial stability — its formal goals are stable prices, or 2% inflation, and maximum employment — there has not yet been an S&P 500 target added to the Federal Reserve's Congressional mandate.

Still, these tighter financial conditions Fed officials are angling towards do carry some potentially significant positive impacts in the Fed's inflation fight. A stronger dollar increases purchasing power for U.S. consumers, brings down global commodity prices, and in turn helps ease input prices. All of which is disinflationary, just what the Fed would like.

As Fed Vice Chair Lael Brainard said in a speech on Wednesday, profit margins in several industries remain elevated after last year's boom and firms appear willing to accept lower margins as consumers respond negatively to higher prices.

And as an added bonus, the soaring greenback also puts pressure on cryptocurrencies — that perennial thorn in the side of U.S. regulators.

The Fed is also expressly content to see lower stock prices dampen the "wealth effect" of the nation's most affluent and their attendant spending. Inasmuch as this "trickles down" to the working class, the Fed is willing to tolerate some increased misery if its broad strokes manage to stuff the inflation genie back in the bottle.

It may seem counterintuitive at best that the Fed's dual mandate has been reduced to a Faustian bargain — balancing the need to reign in trillions in stimulus while taking a hot jobs market off the boil.

But that's where we find ourselves in a topsy-turvy 2022.

And as Powell reminded investors last month, history remains the guide for his Federal Reserve.

"Our monetary policy deliberations and decisions build on what we have learned about inflation dynamics both from the high and volatile inflation of the 1970s and 1980s, and from the low and stable inflation of the past quarter-century," Powell said, pointing to three lessons from history.

First: The Fed takes responsibility for inflation and pushes back at first sight. Second: Don't let the public's expectations get out of whack with your 2% inflation goal. Third: Keep policy tight "until the job is done."

"These lessons are guiding us as we use our tools to bring inflation down," Powell said.

"We are taking forceful and rapid steps to moderate demand so that it comes into better alignment with supply, and to keep inflation expectations anchored. We will keep at it until we are confident the job is done."

And we'll watch the markets for signs we've reached this journey's end."

MY COMMENT

It is very dangerous stuff......when you have the FED manipulating the stock markets with their commentary and timing of their constant media appearances. We have seen throughout history that central economic planing is IMPOSSIBLE.......at least in terms of success.

 

I have noticed lately that mortgage rates here in Texas appear to be at or above 6% when there are "0" points. I am anticipating rates in the 6.5% to 7.5% range as we move forward with the FED rate increases.

On the local real estate situation.....a house just two houses down from me is now on the market for about $1.6MILLION. Just a bit smaller than my......free and clear.....home. I will be watching to see how it does at that price and how quickly it sells. This is the ONLY listing in my immediate neighborhood. It seems high to me with the slow market we seem to be in right now. Not that I would call it a buyers market.....since inventory is STILL only at about 2 months.

 

When I looked about five minutes ago....I had one stock in the red.....Home Depot. Everything else was UP nicely. Adding to my cushion......to weather the rest of the year.

 

There is some good data in this little article for TESLA stock owners.

Here’s what Tesla execs told Gigafactory employees Thursday night about plans and management changes

https://www.cnbc.com/2022/09/08/tesla-gigafactory-nevada-leaked-audio-meeting-new-leaders-goals.html

(BOLD is my opinion OR what I consider important content)

"Key Points

• Leaked audio from Tesla internal meeting confirms VP of Gigafactory Operations Chris Lister has left the company. Hrushikesh “Hrushi” Sagar was promoted to oversee the Gigafactory.
• In an address to employees on Thursday heard by CNBC, Sagar and other leaders talked about production rates in the company’s car factories and for its battery products, the Powerwall and Megapack.
• They also spoke about improvements, including a new wastewater treatment plant and more power from its solar roof.

Tesla has shaken up leadership at the Gigafactory, its sprawling battery plant outside of Reno, Nevada, and is setting new goals for the facility.

Former Vice President of Gigafactory Operations, Chris Lister, left Elon Musk’s electric vehicle and clean energy business this summer, and Hrushikesh “Hrushi” Sagar was promoted to oversee the Gigafactory, according to audio of a Thursday meeting and documents shared with CNBC by people who work at the factory. Sagar reports directly to CEO Elon Musk and will also be overseeing Tesla’s vehicle assembly plant in Fremont, California, simultaneously.

Sagar spoke to a group of hundreds of Gigafactory employees on Thursday afternoon about management changes, performance reviews, factory milestones, and aggressive new goals for the facility. He also disclosed some information about progress in Tesla’s factories in Austin, Texas, and outside of Berlin, Germany.

Sagar briefly addressed Lister’s departure saying, “I really appreciate what Chris Lister did here, Chris’s contribution. I’m very thankful, like Elon, and Tesla is very thankful, for his contribution, but at the same time now we are moving on to the next phase.”

Workers at the Gigafactory manufacture battery packs and power trains for Tesla’s electric vehicles, as well as the big backup batteries, Powerwall and Megapack, sold by Tesla’s Energy division.

During the meeting, Sagar celebrated the fact that Tesla made around 134,000 cars in its Fremont, Calif., factory in the second quarter of 2022, and said that August was one of the record months for Fremont in terms of production. The Fremont factory is now able to make around 12,000 cars per week and is aiming for 14,000 per week as its next goal, he said.

He also said that Tesla’s team in Brandenburg, Germany, recently hit a milestone of being able to produce 1,000 cars on a rolling seven-day basis. Musk recently visited the German factory and the company expects it to ramp production to make 5,000 cars per week by the end of 2022. Initially, Reno was sending drive units to Germany to aid in that effort.


Tesla’s new factory in Austin, Texas also hit the 1,000-per-week production rate.

In terms of drive unit production, the Gigafactory produced 283,473 power trains in the second quarter of 2022 “feeding” the company’s Fremont and Austin factories.

“You all played a very big role,” Sagar said. “I just want to say thank you from the bottom of my heart,” to the Reno team.

Before he joined Tesla in late 2017, Chris Lister spent 22 years in precision manufacturing roles at PepsiCo. During his tenure at Tesla, the Gigafactory experienced a rapid build-out and growing pains including high volumes of scrap, fires and oil spills. But in ramping up production there, he also helped propel Tesla to become the top-selling battery electric vehicle brand in the U.S. and world. Lister and Tesla did not immediately respond to requests for comment.

Sagar’s new title, according to his LinkedIn profile, is senior director of vehicle operations and manufacturing engineering.

Sagar told employees on Thursday that they should think of the Fremont factory as their “customer,” noting that vehicle production there succeeds or is hampered depending on Gigafactory shipping volumes and quality.

While Sagar does not plan to spend most of his time in Reno, he plans to work closely with leaders at the plant, including Energy Leader Matt Reddick, who joined the company about six months ago, and Site Leader Eric Montgomery, who will manage things day-to-day in Nevada. Other top leaders at the Gigafactory now include Jeff Jackson, who is heading up infrastructure for the facility, and Bert Somsin, a human resources director for the plant.

At the same meeting on Thursday, Montgomery told Gigafactory employees that they need to get to a steady output of 8,800 high voltage battery packs per week to support Fremont’s new production goals, and “maximize all-wheel-drive builds.” He said August 2022 was also the Gigafactory’s second-best month on record for production, second only to October 2021.

Reddick said Tesla can now produce 42 giant Megapack batteries in a seven-day rolling period. Megapacks are about the size of a shipping container and are used for utility-scale energy storage, often to store excess energy generated by wind or solar.

Tesla is on target to produce 442 Megapacks during the third quarter of 2022, representing an 85% growth over Megapack production in the previous three-month period.

The Gigafactory also hit and has exceeded a production rate of 6,500 Powerwalls per week. Powerwalls are the smaller backup batteries for home use that CEO Elon Musk recently promoted on Twitter amid a massive heatwave in California. The heat wave threatened blackouts, and had the state urging residents to reduce their power consumption during peak hours.

Tesla previously required customers who wanted to buy a Powerwall also to buy a solar roof from the company. The Nevada Gigafactory made 37,600 Powerwalls in the second quarter, Montgomery said, and said the facility is on target to increase that by 22% in the third quarter.

In terms of the facility itself, Jackson touted a new, advanced water treatment facility that Tesla is building on site.

“This is to going to eliminate the discharge of our site process water, or wastewater, and it’s going to allow for 98% water recycling and evaporation,” he said. “It’s a huge thing, it’s aligned with our mission.”

Jackson also gave an update on the Gigafactory’s solar roof. “Right now we’ve got about eight megawatts on the roof that we’re able to use on a daily basis, which is really exciting,” the infrastructure leader said.

Tesla also has a new food vendor on site that provides poke bowls, is building a meditation room for employees, and is making road improvements and installing more EV chargers along the roads around the facility.

On the human resources front, workers were urged to reduce the number of labor hours it takes to produce a single unit of the products they build in their teams, and to file more “take charge” notices about how to improve safety and reduce costs around the plant.

The company is moving past steep headcount cuts that took place in the second-quarter this year, and is in the midst of an extensive, performance review process, Sagar said.

One employee asked management if their equity grants would be tied to company milestones this year, and management said no. But human resources teams and managers are still figuring out who may be eligible for promotions, raises and bonuses. Sagar said by the end of September, managers should be speaking with their teams about their performance assessments.

Employees asked management to discuss whether and where Tesla’s next factory may be built. Lobbying activity by Tesla in Canada, and the company’s investments up North previously have stirred speculation of a Canada-based plant.

Sagar said, “I have some idea on the candidates but I don’t think I’m at liberty right now to disclose those candidates because of the confidentiality around some of those things.” He did offer, “There is an exciting future for North America and all around the Americas.”"

MY COMMENT

The Austin and Berlin plants are starting to ramp up. The company is going to have some really HEFTY years ahead of them as the big growth items in this little article hit full stride.

I was out near the Austin plant the other day. From the outside the plant seems done.......but there are still some cranes operating there dong some sort of construction.

Elon is concentrating his operations around that area.......the Auto plant in Del Valle (South/East Austin area).......and....Boring Company and SpaceX facilities in the early stages of approval and construction in Bastrop County, just South and East of Austin. The area where ALL the Musk operations are being built out was extremely poor and underdeveloped up to just a few years ago. A smart move by Musk to focus on that area....property prices are more reasonable and there is lots of available land. The roads in that area are also very good with great access to the Austin airport and the city. Before Tesla.....that area was one of the least developed close in areas.

 

A WONDERFUL day and week in the markets. Reminds me of the markets about 3 weeks ago.

I had a nice hefty gain today. My ONLY down stock was Home Depot. I dont really care since they have been kicking ass lately in their earnings and they DOMINATE the hardware niche.

I also got in a beat on the SP500 by 0.46%.

I was able to reduce my year to date LOSS to........(-20.03%)......this week. The SP500 ended the week down for the year by (-14.66%)

 

HERE is the week that just ended......as well as year to date.

DOW year to date (-11.52%)
DOW for the week +2.66%

SP500 year to date (-14.66%)
SP500 for the week +3.65%

NASDAQ 100 year to date (-22.87%)
NASDAQ 100 for the week +4.05%

NASDAQ year to date (-22.58%)
NASDAQ for the week +4.14%

RUSSELL year to date (-16.14%)
RUSSELL for the week +4.04%

HAPPY DAYS ARE HERE AGAIN.

 

This week was extremely strong. The markets showed real resilience. Even though the FED made a major announcement this week....the markets just powered on.

We have now broken the back of the losing streak.......and....have potential moving forward. No guarantees.....but potential. If we can get in a nice FALL RALLY we can really cut into the year to date losses. I would not underestimate the potential of this market.....in either direction. BUT....since I am a long term.....fully invested all the time investor.....I really dont care, I will just go with what happens.

 

Typical government action.....they can just never leave things alone. They have to treat you like you are a MORON.

New 401(k) statements could confuse folks about their retirement savings

https://finance.yahoo.com/news/401-k-statements-retirement-savings-181646060.html

(BOLD is my opinion OR what I consider important content)

"There’s a new twist to your quarterly 401(k) statement that may merit an extra look.

For the first time, 401(k) statements will feature a lifetime income illustration which shows the monthly income you would receive from your current 401(k) savings when you’re 67. In essence, it shows you roughly how much income you’d get per month for the rest of your life if you were to purchase an annuity with your current 401(k) savings at age 67.

While the mission of the snapshot illustration is an admirable one — helping you get a sense of whether your retirement stockpile is likely to last your lifetime — some experts worry these may cause additional confusion and won’t have the intended effect of nudging Americans to ramp up their savings shortcomings.

“What they're putting out there is version 1.0. They can improve upon this in the future,” Phil Maffei, managing director of corporate retirement income products at TIAA, told Yahoo Money. “But very few people are really paying attention these days, so it doesn't surprise me if nobody notices the feature on there.”

These illustrations have been in the works for a long time.

The new federal rule was part of the 2019 Secure Act retirement savings law and requires that by this fall all 401(k) plan administrators must at least annually show an illustration on your statement of how the money in your account would convert into an estimated lifelong monthly income stream when you’re 67, which is the Social Security full retirement age for most workers. Individual Retirement Account (IRA) managers aren’t required to do this.

Here’s what this means.

You’ll find two estimates on your statement: One is for a “single life” annuity, which pays income to an individual buyer for life. The other is for a “qualified joint and survivor” annuity, which pays income for an individual and a surviving spouse for life.

Say you’re 40 years old and have a 401(k) with $125,000, the illustration would translate that to around $500 or $600 in monthly income with these new illustrations. That could be a wake-up call if you find the monthly income to be too low.

The cold truth is that one of the biggest worries most people have as they near retirement is will they outlive their money. With studies showing that increasingly Americans are stepping out of the workforce earlier than they anticipated, retirement planning takes on a new urgency.

The downside to the new lifetime income illustrations

But the illustrations may help only certain segments of people, experts worry.

“The projections are going to be pretty reasonable for someone who's close to retirement,” Maffei said, “but meaningless for someone who's 25 or 35.”

The estimate is a precise moment in time. For instance, it doesn’t take into account any new contributions you make in the future, nor does it include earnings growth over time, or future employer match contributions. And the potential impact of inflation isn’t even on the radar.

“It's a great first start, but I do worry that for younger employees, it may disincentivize them from saving,” Maffei said. “You get this projection, which shows a very minimal amount of money. They're not going to understand and connect the dots on why this is so low. It's not projecting that $25,000 they now have saved forward to what could be a million dollars at age 65.”

And it’s important for 401(k) savers to remember that this calculation is one piece of your retirement income. Social Security and any retirement savings outside of your 401(k) plan are not factored into these calculations.

“On the surface, this seems like a good idea, but in the execution, this may be misleading to many 401(k) participants,” Joyce Streithorst, a certified financial planner at Frisch Financial Group, Inc. in Melville, N.Y., told Yahoo Money. “It is helpful to see the numbers showing what a lump sum amount would look like as a monthly check, but this doesn’t tell the whole story. There is so much small print explaining how the calculations were done that I’m afraid people will get confused about what the numbers represent.”

Aside from the fact that the calculations assume that you’re currently 67 (regardless of your actual age and that your spouse is the same age) and annuitizing your 401(k) right now, the interest rate being used for the estimate is the 10-year Treasury rate, which doesn’t reflect any possible equity returns.

“Possible misunderstandings include, first, ‘since my company knows my age and my spouse’s age, these projections are a representation of what I would get,’ which they are not,” Streithorst said. “Two, ‘this is my current ‘pension’ amount and it's guaranteed.’ And, of course, that is not the case. And third, not knowing how asset allocation and market volatility can impact these numbers.”

Her verdict: “This new rule can best be helpful for someone close to age 67, where the numbers would be the closest to actual. The younger an employee is, the less reliance can be placed on these numbers, and the more misleading they may be.”

MY COMMENT

We are the government and we are here to help. Whether you want it or not. This may be good for some people.....or just useless information with no meaning for many. Regardless of your age or situation.....this is NOT something that you can rely on.

Just fund your 401K to the max for the match and beyond if you can. Actually I would prefer to fund to the max for the match and than put the rest of my retirement savings into a taxable brokerage account. I am not a big fan of compounding money for the government to tax later at income tax rates. I would much rather pay a small amount of extra taxes now than massive lifetime taxes on the compounded amount later in life.

 

Not sure I really care what this lady thinks about the new Apple products.

Steve Jobs' daughter mocks Apple's iPhone 14
The four new iPhones will be available in mid-to-late September and early October

https://www.foxbusiness.com/technology/steve-jobs-daughter-mocks-apples-iphone-14

MY COMMENT

This......."model and equestrian".....in other words someone totally out of touch with reality especially anything to do with business.....is not someone that I really care what they think. Of course this is where we are at now in terms of society and media.

 

TGIF.....everyone. We did good this week......even though it was a short week. Lets come back on Monday prepared to........KICK ASS.