January 2009 Newsletter
The Economy in the New Year
by Guy Baker
The Labor Department said job losses "were large and widespread across most major industry sectors."
The manufacturing sector lost 149,000 jobs in December.
Once lost, these jobs are rarely replaced when compared to jobs in the service sector. It is much more difficult for a factory to restart for example than to rent more office space.
Data from economy.com shows the average worker has a shorter work week and is earning . . . -READ More-
It was a year of financial chaos, but what comes next?
Last year was the third-worst ever for the U.S. stock market.
Only in 1931 and 1937 did the Standard & Poor’s Index fall by more than 38.5 percent, turning in a worse showing than 2008. The loss of trillions of investors’ wealth has them running scared as the new year begins. Adding to the fear is . . . -READ MORE-
Charitable giving for the middle class
You don’t need to be a multi-millionaire to make a difference
As the year ends, you might be thinking about making a gift to your old school or a charity – especially if you dislike taking Required Minimum Distributions (RMDs) from your IRA. After all, your altruism has the potential to bring you a tax break.
Do you have to make a multimillion-dollar gift to receive immediate or future financial benefits? No. . . -READ More-
College costs rise dramatically in 2008
Current and prospective college students got a double dose of bad news last year: costs rose sharply while college lending dried up. 
The independent College Board reported that costs jumped by an average of 6.4 percent in the fall of 2008, even as the general rate of inflation plummeted.
The average list price of tuition and fees at four-year public universities rose to $6,585 per year, while the cost of the average private college increased to . . . -READ More-
Upending a historical relation between bond and stock yields
Amid all of the financial market upheaval of 2008, an unexpected and significant turnabout occurred whose significance was missed by many investors.
For the first time in 50 years, the dividend yield on U.S. stocks rose above the yield on the benchmark U.S. Treasury 10-year note.
That had not happened since 1958, when stock yields dropped below bond yields for the first time ever . . .-READ MORE-
Want to cut down on your spending? Try using only cash
New findings in behavioral and neuro-economic research support a long-recommended strategy for cutting down on spending.
Some financial experts recommend that the fastest way to help reduce your spending is to cut up credit cards and switch to cash
for all purchases. . . -READ MORE-