Treasury Secretary Mnuchin did not cause the recent dollar dive. His remarks
(“Obviously a weaker dollar is good for us as it relates to trade and opportunities”) at
the World Economic Forum in Davos were surprising, because government officials have
historically not been willing to acknowledge that when the value of the dollar falls, it
makes US exports cheaper. The result can be good for US manufacturers and can also
improve the trade balance.
The Dow closed above 26000 and the NASDAQ finally topped its inflation adjusted high
last week, begging the question: Why don’t investors care about a government
shutdown? The answer may be that they don’t care about lots of risks that exist, but
more specifically, previous periods when Congressional impasses have lead to Uncle
Sam shuttering some of its operations, have not spelled Armageddon for stocks.
You’ve seen the frightening surveys that say Americans are ill prepared for retirement,
but let’s start the year on a more pro-active foot. It’s time to jump-start your savings
plan and to help out; I’m going to break it out by generation.
Mega-retailer Wal-Mart made news last week when it announced that it will raise
starting wages to $11 per hour, will offer bonuses up to $1,000 to many of its workers
and expand maternity/paternity policies. Should the million or so employees who will be
affected by the moves thank the GOP tax cut? The company indicated that changes in
the law were at least partially responsible and certainly the billions that the company
stands to reap from the corporate tax rate dropping from 35 to 21 percent will more
than offset the $700 million cost for the new policies.
A reader wrote to me: “After your recent article about the big questions for 2018, I was astounded that ‘only 54 percent of Americans report having money invested in the stock market at all.’ Does that mean that all of the attention we put on the stock market is misplaced? Are we putting too much focus on stocks?”
Read More2017 was a year that defied most expectations. Synchronistic global growth led to a surge in corporate profits, which in turn pushed worldwide stocks higher. The FTSE All-World index shot up nearly 22 percent, its biggest rise since 2009. US markets were along for the ride: The Dow Jones Industrial Average increased by 25.1 percent, the broad S&P 500 index was up 19.4 percent and the NASDAQ Composite jumped 28.2 percent. The Russell 2000 index of small companies, which was the big winner in 2016, put in a more than respectable 13.1 percent return.
Read MoreA colleague of mine recently asked me how he might be able to finally stick to a budget. For years, he had tried to create and adhere to a specific annual spending plan, only to blow a hole through it at some point during the year. “What’s wrong with me? I know that I should do it, but there’s always something that comes up!”
Read MoreIt’s always interesting to look back at the year that was…here are my 7 Biggest Money Stories of 2017:
Read MoreIf you are looking for interesting holiday books this season, check out some of these ideas. I have interviewed all of the authors on my show, “Better Off”, so if you aren’t tempted by the descriptions, listen to the podcast, which will leave you wanting more!
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