Cryptocurrencies have surged so much that their total value has reached nearly $2.5 trillion, rivaling the world’s most valuable company, Apple, and have amassed more than 200 million users. At that size, it’s simply too big for the financial establishment to ignore.

Firms that cater to the world’s wealthiest families are increasingly putting some of their fortunes into crypto. Hedge funds are trading Bitcoin, which has big-name banks starting to offer them services around it. PayPal lets users buy crypto on its app, while Twitter helps people show appreciation for tweets by tipping their creators with Bitcoin.

And in the latest milestone for the industry, an easy-to-trade fund tied to Bitcoin began trading on Tuesday. Investors can buy the exchange-traded fund from ProShares through an old-school brokerage account, without having to learn what a hot or cold wallet is.

It’s all part of a movement across big businesses that see a chance to profit on the fervor around the world of crypto, as a new ecosystem further builds up around it, whether they believe in it or not.

“The one thing you can say for certain is that the advent of the era of the Bitcoin ETF opens up the opportunity for Wall Street to make money on Bitcoin in a way that it hadn’t been able to previously,” said Ben Johnson, director of global ETF research at Morningstar. “The winners in all of this are the exchanges and the asset managers and the custodians. Whether investors win or not is a big, bold question mark.”

Bitcoin has come a long way since someone or a group of someones under the name Satoshi Nakamoto wrote a paper in 2008 about how to harness computing power around the world to create a digital currency that can’t be double-spent. The price has more than doubled this year alone to roughly $62,000. It was at only $635 five years ago.

Supporters of cryptocurrencies say they offer an ultra-important benefit for any investor: something whose price moves independently of the economy, rather than tracking it like so many other investments do. More high-minded fans say digital assets are simply the future of finance, allowing transactions to sidestep middlemen and fees with a currency that’s not beholden to any government.

Critics, meanwhile, question whether crypto is just a fad, say it uses too much energy and point to all the stiff regulatory scrutiny shining on it. China last month declared Bitcoin transactions illegal, for example. The chair of the U.S. Securities and Exchange Commission, Gary Gensler, said in August that the world of crypto doesn’t have enough investor protection and “it’s more like the Wild West.”

That hasn’t been enough to halt the immense momentum for crypto, as it’s gone from an online curiosity to a bigger part of the cultural and corporate landscape.

U.S. Bank earlier this month said it has begun offering a cryptocurrency custody service for big investment managers. That means it essentially holds their Bitcoin in safekeeping for them, and it expects to offer support for other coins soon.

Other name-brand banks have also announced intentions to offer custodial services for crypto.

“It’s not just in the fringes and dark corners of the Web that it’s happening,” said Kashif Ahmed, president of American Private Wealth in Bedford, Massachusetts.

Ahmed doesn’t recommend his clients invest in crypto. Before then, he said he’ll need to be able to “go to my local supermarket and buy things for my family and offer crypto and not be laughed out of the store.” But others are more willing to try it.

In a survey by Citi Private Bank of family offices around the world that manage money for wealthy people, roughly 23% said they have made some investments in crypto. Another 25% said they are researching it. The growing acceptance of crypto on Wall Street has created a new crop of darlings that help people buy it. Crypto trading platform Coinbase has a market value of roughly $64 billion, for example, putting it on par with such established companies as Colgate-Palmolive, FedEx and Ford Motor.

At Robinhood Markets, meanwhile, the company that became famous for getting a new generation of investors into the stock market is increasingly becoming a place for crypto trading. This spring was the first time when new Robinhood customers were more likely to make their first trade in cryptocurrencies rather than in stocks. In the end, what many on Wall Street see lasting may not be as much Bitcoin and other cryptocurrencies as the technology that underlies them.

Called the blockchain, it allows for a public ledger that everyone can check and trust, and many expect it to lead to a wealth of innovations. It’s akin to today’s Netflix, Facebook and other services that sprung out of the infrastructure built during the boom and bust of the dot-com bubble. “The applications built on this new software architecture appear to be growing more quickly than past technologies,” Bank of America strategists Alkesh Shah and Andrew Moss wrote in a recent research report positing digital assets are only in their first inning of growth. “New companies are likely to emerge and poorly positioned companies will exit, creating significant upside potential for some and downside for others.”

JPMorgan Chase, for example, is already using blockchain technology to improve fund transfers between global banks. That’s the same JPMorgan Chase run by CEO Jamie Dimon, who said in an interview with Axios this month that bitcoin has “got no intrinsic value.”

STAN CHOE | AP News

Find your latest news here at the Hemet & San Jacinto Chronicle

The post As Bitcoin goes mainstream, Wall Street looks to cash in appeared first on The Hemet & San Jacinto Chronicle.

By Kellie Schmitt

At the Texas hospital where Dr. Christopher Moriates works, it’s a common story: Patients come in with diabetic ketoacidosis, a life-threatening condition that can be prevented with insulin shots. 

“They say they couldn’t afford or are self-rationing their insulin,” said Moriates, a hospitalist and executive director of the nonprofit Costs of Care.

While many of these patients are uninsured, others are foregoing medicine because their private insurance plan has a high deductible or requires a hefty co-pay. That’s why Moriates wasn’t surprised to hear about a new study that found people with private marketplace insurance plans are more likely to avoid medical care and face financial problems than adults with Medicaid, the state-federal health plan for low-income Americans.   

“Once again, it reaffirms the incredibly widespread unaffordability of health insurance — even for people with insurance — and how it’s affecting their behavior,” he said.

In fact, 19% of people surveyed with private marketplace plans — often called Obamacare plans — skipped prescriptions, delayed care and faced financial problems. That’s much higher than the 10% of Medicaid patients who did the same, according to the paper, published in the Journal of General Internal Medicine this month.

Such findings have direct implications for the current Congressional debate among Democrats over how to nudge the dozen holdout states to expand their Medicaid programs — potentially by using health exchange plans as a bridge.

What may be more surprising, though: Researchers found that people with Medicaid benefits were just as likely to have their insurance accepted by a doctor as those using these marketplace plans.

“There’s a prevailing idea that private insurance is more likely to be accepted by physicians — even if it’s a marketplace plan—and we didn’t see that,” said Dr. Sonali Saluja, who co-authored the paper with Cameron Kaplan, Pooja Dhupati, and Dr. Danny McCormick.

Those findings come after the COVID-19 relief law bolstered marketplace enrollment, temporarily offering subsidies to higher-income groups and increasing financial assistance to people who already qualified. The study’s findings, though, suggest that expanding Medicaid would likely provide better financial protections for low-to-moderate income Americans while ensuring access to care, Saluja said.

Comparing two approaches

The Affordable Care Act created two ways to cover low-and-middle income Americans: expanding Medicaid for low-income adults and creating a health insurance marketplace where eligible individuals could buy private insurance plan, subsidized according to income level.

With tens of millions of Americans still without insurance, it’s important to evaluate how these approaches are faring, both absolutely and comparatively, said co-author Danny McCormick, an associate professor of medicine at Harvard Medical School.  

As Congressional Democrats weigh a federal coverage plan to address uninsured people in non-expansion states, the study offers policymakers more information. 

“Do we build on marketplace plans or other public programs like Medicaid?” he said. “We think comparing will help inform these policy decisions and help people figure out what works better.”

The study used national survey data for more than 37,000 adults who had marketplace, Medicaid or employer-provided coverage. People with employer-sponsored plans fared better in areas such as access to providers. But they, too, were more likely than Medicaid enrollees to delay or forgo care because of cost.

Among other key findings: 32% of surveyed adults with marketplace plans said they were “very worried” about being unable to pay their medical fees if they were in a serious accident or had a major illness. That’s compared to 26% for adults enrolled in Medicaid plans.

A large percentage of both marketplace (21.5%) and Medicaid (20%) enrollees reported skipping their prescribed medications because of cost concerns. Those numbers jumped even higher when separating out people with chronic medical conditions such as diabetes.

While researchers didn’t parse out the specific drivers of out-of-pocket costs, those with marketplace plans likely faced some combination of high deductibles, copays or coinsurance, in which a patient must pay a percentage of their bill, Saluja said. The marketplace plans might also have narrow networks, increasing the chances that they face large bills for out-of-network care.

“Do we build on marketplace plans or other public programs like Medicaid? We think comparing will help inform these policy decisions and help people figure out what works better.” — Danny McCormick, Harvard Medical School

By comparison, Medicaid generally requires no premium payments and there’s no or minimal deductibles and co-pays. Still, some states can establish out-of-pocket costs and several have monthly limitations on the number or type of prescriptions.

“Patients with Medicaid struggle with many different things often related to life circumstances and social needs, but there is some sort of sense there are options for me to get care if and when I need it,” Saluja said.

Everyone’s feeling the pinch

Since the study used nationwide figures, there are some limitations, said Simon Haeder, a Penn State School of Public Policy professor whose work focuses on the Affordable Care Act and who was not involved in the study. For instance, it would have been interesting to compare Medicaid to marketplace plans by state to give a sense of how these findings vary geographically.

Another important caveat in the findings: The data came from 2015-18, a period that captures the landscape after the dust settled on the ACA but before the pandemic led to job and insurance losses as well as delays in care. We still don’t know the long-term impact of the pandemic on factors such as health care costs and access to care, he pointed out.

“It feels like a different world at this point,” Haeder said. 

But the study’s findings make sense given the cost-sharing structure of many marketplace plans, he said. Even though cost concerns among Medicaid enrollees were much lower among those surveyed, they are still “strikingly bad,” he said. And those with employer-sponsored insurance are also feeling the pinch.

All of that underscores just how much remains to be done to realize the ACA’s goal of easing health care’s financial strains, Haeder said: “We’re very far away from people accessing medical care without being worried what it will do to their pocketbook.”

Find your latest news here at the Hemet & San Jacinto Chronicle

The post Does Medicaid take better care of Americans and their finances than exchange plans? appeared first on The Hemet & San Jacinto Chronicle.

WASHINGTON (AP) — A Congress riven along party lines approved the landmark $1.9 trillion COVID-19 relief bill Wednesday, as President Joe Biden and Democrats claimed a major triumph on legislation marshaling the government’s spending might against twin pandemic and economic crises that have upended a nation.

The House gave final congressional approval to the sweeping package by a near party line 220-211 vote precisely seven weeks after Biden entered the White House and four days after the Senate passed the bill. Republicans in both chambers opposed the legislation unanimously, characterizing it as bloated, crammed with liberal policies and heedless of signs the crises are easing.

“Help is here,” Biden tweeted moments after the roll call, which ended with applause from Democratic lawmakers. Biden said he’d sign the measure Friday.

Most noticeable to many Americans are provisions providing up to $1,400 direct payments this year to most adults and extending $300 weekly emergency unemployment benefits into early September. But the legislation goes far beyond that.

The measure addresses Democrats’ campaign promises and Biden’s top initial priority of easing a one-two punch that first hit the country a year ago. Since then, many Americans have been relegated to hermit-like lifestyles in their homes to avoid a disease that’s killed over 525,000 people — about the population of Wichita, Kansas — and plunged the economy to its deepest depths since the Great Depression.

“Today we have a decision to make of tremendous consequence,” said House Speaker Nancy Pelosi, D-Calif., “a decision that will make a difference for millions of Americans, saving lives and livelihoods.”

For Biden and Democrats, the bill is essentially a canvas on which they’ve painted their core beliefs — that government programs can be a benefit, not a bane, to millions of people and that spending huge sums on such efforts can be a cure, not a curse. The measure so closely tracks Democrats’ priorities that several rank it with the top achievements of their careers, and despite their slender congressional majorities there was never real suspense over its fate.

They were also empowered by three dynamics: their unfettered control of the White House and Congress, polls showing robust support for Biden’s approach and a moment when most voters care little that the national debt is soaring toward a stratospheric $22 trillion. Neither party seems much troubled by surging red ink, either, except when the other is using it to finance its priorities, be they Democratic spending or GOP tax cuts.

Republicans noted that they’ve overwhelmingly supported five previous relief bills that Congress has approved since the pandemic struck a year ago, when divided government under then-President Donald Trump forced the parties to negotiate. They said this one solely reflected Democratic goals by setting aside money for family planning programs and federal workers who take leave to cope with COVID-19 and failing to require that shuttered schools accepting aid reopen their doors.

“If you’re a member of the swamp, you do pretty well under this bill. But for the American people, it means serious problems immediately on the horizon,” said House Minority Leader Kevin McCarthy, R-Calif., referring to the added federal borrowing the measure will force.

Even so, Mississippi Sen. Roger Wicker, who like all Republicans voted against the bill, touted its $29 billion for the ailing restaurant industry, tweeting that it would help them “survive the pandemic.” Democrats predicted this week that Republicans would do that, with Pelosi saying, “It’s typical that they will vote no and take the dough.”

A dominant feature of the 628-page bill is initiatives making it one of the biggest federal efforts in years to assist lower- and middle-income families. Included are expanded tax credits over the next year for children, child care and family leave — some of them credits that Democrats have signaled they’d like to make permanent — plus spending for renters, feeding programs and people’s utility bills.

Besides the direct payments and jobless-benefit extension, the measure has hundreds of billions for COVID-19 vaccines and treatments, schools, state and local governments and ailing industries from airlines to concert halls. There is aid for farmers of color, pension systems and student borrowers, and subsidies for consumers buying health insurance and states expanding Medicaid coverage for lower earners.

“Who’s going to help? Do we say this is all survival of the fittest? No,” said House Budget Committee Chairman John Yarmuth, D-Ky. “We rise to the occasion. We deliver.”

The legislation would reduce the number of people living in poverty this year by around one-third, from 44 million down to 28 million, the liberal-leaning Urban Institute estimated Wednesday. The poverty rate for children would be reduced by over half, said the institute, which examined the impact of the measure’s stimulus checks, jobless benefits, food stamps and tax credits for children.

Rep. Jared Golden of Maine was the only Democrat to oppose the measure. He said in a written statement that some of the bill’s spending wasn’t urgent.

The measure was approved amid promising though mixed signs of recovery.

Americans are getting vaccinated at increasingly robust rates, though that is tempered by coronavirus variants and people’s growing impatience with curbing social activities. The economy created an unexpectedly strong 379,000 jobs last month, though there remain 9.5 million fewer than before the pandemic struck.

Republicans said the country will pay a price for the extra spending.

“It’s certainly good politics to say, ‘Hey, we’re going to hand you a check for $1,400,’” said Rep. Tom Rice, R-S.C. “But what they don’t talk about is what this bill costs.”

An Associated Press-NORC Center for Public Affairs Research poll found last week that 70% of Americans back Biden’s response to the virus, including a hefty 44% of Republicans. According to a CNN poll released Wednesday, the relief bill is backed by 61% of Americans, including nearly all Democrats, 58% of independents and 26% of Republicans.

Yet until November 2022, when control of the Senate and House will be at stake, it will be uncertain whether voters will reward Democrats, punish them or make decisions on unforeseen issues.

The bill’s pathway has underscored Democrats’ challenges as they seek to build a legislative record to appeal to voters.

Democrats control the Senate, split 50-50, only because Vice President Kamala Harris gives them the winning vote in tied roll calls. They have just a 10-vote advantage in the House.

That’s almost no wiggle room for a party that ranges from West Virginia Sen. Joe Manchin on the conservative side to progressives like New York Rep. Alexandria Ocasio-Cortez.

On the relief bill, progressives had to swallow big concessions to solidify moderate support.

The most painful was eliminating the House-approved federal minimum-wage increase to $15 hourly by 2025. Moderates also succeeded in trimming the emergency jobless benefits, which in an earlier version were $400 weekly, and phasing out the $1,400 stimulus checks completely for earners at lower levels than originally proposed.

At some point it seems likely that progressives will draw their own lines in the sand.

Find your latest news here at the Hemet & San Jacinto Chronicle

The post Congress OKs $1.9T virus relief bill in win for Biden, Dems appeared first on The Hemet & San Jacinto Chronicle.

WASHINGTON (AP) — President Joe Biden wants America to know that he’s from the government and he’s here to help.

That sentiment became a well-worn punchline under Ronald Reagan and shaped the politics of both parties for four decades. Democrat Bill Clinton declared the era of big government over in the 1990s, Barack Obama largely kept his party in the same lane and Republican Donald Trump campaigned on the premise that Washington was full of morons, outplayed by the Chinese and others.

But Biden is now staking his presidency on the idea that the government can use his $1.9 trillion coronavirus relief plan not only to stop a pandemic and jobs crisis but also to catapult the country forward to tackle deep issues of poverty, inequality and more. The massive bill could be approved by Congress as early as Tuesday.

“When I was elected, I said we were going to get the government out of the business of battling on Twitter and back in the business of delivering for the American people,” Biden said after the huge bill passed the Senate on Saturday. “Of showing the American people that their government can work for them.”

Taken together, provisions in the 628-page bill add up to one of the largest enhancements to the social safety net in decades, pushing the country into uncharted territory.

Besides stopping the pandemic and jumpstarting hiring, money in the rescue package — now awaiting final approval in the House — is supposed to start fixing income inequality, halve child poverty, feed the hungry, save pensions, sustain public transit, let schools reopen with confidence and help repair state and local government finances. And Biden is betting that the government can do all of this with the speed of a nation mobilizing for war without touching a tripwire of inflation.

“People have lost faith government can do good for them,” says Senate Majority Leader Chuck Schumer, who spoke daily with Biden while ushering the bill through the Senate last weekend. Now, as vaccines become more available and other changes take place, “people are going to see that government actually is making their lives better — which is how Americans used to think of it, and we’ve gotten away from it.”

Republicans say Americans have plenty of reason to be skeptical, calling the American Rescue Plan excessive and wasteful. They warn the sweeping package will run up the national debt to precarious new heights after $4 trillion in aid has already been provided.

Senate Republican leader Mitch McConnell argues against the package as missing the moment — too big at a time when the virus is showing signs of easing and the economy is poised to come “roaring” back.

Instead of working across the aisle toward unity, as Biden has promised, McConnell says Democrats are “ramming through what they call ‘the most progressive domestic legislation in a generation,'” quoting the White House chief of staff.

“They explained their intent very clearly: to exploit this crisis as ‘a tremendous opportunity to restructure things to fit our vision,’” McConnell says. This is the first COVID-19 bill that had zero support from Republicans in the House or Senate.

Biden’s bet, more than others in modern politics and economics, is full of questions.

Can the federal money push economic growth above 6% for the first time since Reagan in 1984? Will the 9.5 million lost jobs quickly return? Will inflation surge? Will the national debt spook voters in next year’s midterm elections? Biden has placed the biggest of markers on the theories of the 20th Century British economist John Maynard Keynes that the government can stimulate a dormant economy back to health.

Sweeping in scope, Biden’s plan largely relies on existing health care and tax credits, rather than new programs, but it expands that standard fare in ambitious new ways that are designed to reach more people who are suffering in an unprecedented time.

“We haven’t done this before,” said Syracuse University economics professor Len Burman, a co-founder of the Tax Policy Center. “If it actually does work the way it does in theory and the economy is back at full employment in a year, that would be amazing. It would save a lot of hardship and suffering.”

But Burman also has misgivings about the design of Biden’s package because it distributes direct payments and other benefits to almost every household in the United States, rather than directing the money to the poor and to businesses and organizations most damaged by the pandemic and ensuing shutdowns.

“It kind of reminded me of this idea when I was in grad school of helicopter money — which was basically dropping money from the air and seeing if it raised incomes,” he said. “The money could have been better targeted.”

Final passage of the bill is expected this week — before expanded unemployment benefits are set to expire mid-March. But Biden’s signing celebration will just be the start. His administration will have to show that the funds can be spent effectively and efficiently, helping those in need while giving the broader public enough confidence to awaken growth through hiring and spending.

Felicia Wong, CEO of the liberal Roosevelt Institute, sees parallels to the Great Depression, when Franklin Delano Roosevelt brought about an unprecedented series of government interventions that realigned U.S. politics. Wong said she is monitoring the process by which the money from the COVID-19 relief package gets distributed.

“That’s going to matter as much as the scale of the package because it’s going to build trust,” Wong said.

Republicans are poised to portray the spending as bloated and inefficient, much the way they attacked the Obama-era recovery act during the 2009 financial crisis.

At the same time, much of the aid is temporary, set to expire in a year or so, leaving Congress to assess Biden’s approach ahead of the next election season.

Find your latest news here at the Hemet & San Jacinto Chronicle

The post $1.9T Biden relief package a bet government can help cure US appeared first on The Hemet & San Jacinto Chronicle.

Eastern Municipal Water District (EMWD) was recently recognized for Excellence in Financial Reporting by the Government Finance Officers Association, marking the 16th consecutive year that EMWD has earned the distinction.

EMWD received the Certificate of Achievement for its Comprehensive Annual Financial Report for the fiscal year ending June 30, 2019.

The Government Finance Officers Association is a 21,000-member nonprofit organization for government finance professionals.

“EMWD is honored to once again be recognized by the Association for our commitment to financial transparency,” EMWD Board President Ron Sullivan said. “We are proud to continually demonstrate responsible stewardship of public funds on behalf of our customers.”

Copies of EMWD’s Comprehensive Annual Financial Reports are available online at www.emwd.org.

Find your latest news here at the Hemet & San Jacinto Chronicle

Search: EMWD Honored

The post EMWD Honored for Financial Reporting Excellence appeared first on The Hemet & San Jacinto Chronicle.

Now that the initial shock of the pandemic has started to wear off, it’s time to take a step back and really start planning. Everyone is living through an unprecedented time. The uncertainty surrounding the Covid-19 pandemic is enough to rattle even the strictest saver. Things may feel that they are all out of your control, so focus on what you can control. First things first.

Listen to healthcare professionals and follow guidelines to protect yourself and others. If you are financially impacted by Covid-19 for any reason, there are steps you can take to help minimize that impact. Even if you have not yet been financially impacted by the current state of events, it is vital to either reassess your household budget or create one if you have not already. Involve your family in this as much as you can.

Just letting your family know you are thinking about the crisis and how you will respond can be enough to help ease some of the anxiety around the unknown. When you are looking at your crisis budget, identify which expenses are absolutely necessary and which are not. It is best to make the hard decisions now, even if you have a savings account built up, rather than wait until you are forced to make those decisions.

Focus on your rent or mortgage first. You need to keep a roof over your head if at all possible. With a situation as fluid as this, it is important to realize that there are resources available to help if needed and that those resources could change. If you are ever in a situation in which you are unable to pay your rent or mortgage, contact your landlord or mortgage provider right away. Once you have the rent and mortgage covered, then move on to food, utilities, and down on to the more non-essential items.

In the event you are unable to make a debt payment, make sure you contact the creditor as soon as you know you will miss the payment. During this difficult time, many creditors are expanding the options available to those unable to make their monthly payments. If you feel lost when it comes to making a budget, as many do, please reach out to a Certified Credit Counselor at Family Credit Management.

Family Credit Management is a nonprofit credit counseling agency that has been helping consumers in difficult financial situations for more than 23 years.

Reach out for a no-strings attached budget review from an objective professional by calling 1-800-994-3328 and selecting option 1. For more in-depth tips and resources, please visit www.familycredit.org/covid19.

Find your latest news here at the Hemet & San Jacinto Chronicle

Search: Finances During A Pandemic

The post Finances During A Pandemic appeared first on The Hemet & San Jacinto Chronicle.

If you have school-age children, you are probably one of the many parents facing the challenge of educating your kids at home. While there are countless learning options available—from virtual music classes to videos about zoo animals—financial literacy is one important subject that should not be overlooked.

Teaching your children financial literacy gives them the knowledge, skills and motivation to responsibly manage their money and achieve their future goals. Learning fundamental financial concepts is not always easy, so experts recommend that you start with the basics. Here are a few ideas to get you started:

• Explain that there are three things you can do with money: spend it, save it or give it away. To illustrate the point and introduce them to budgeting, have your child divide up money they receive from gifts or an allowance. Have them pay themselves first by putting a certain amount into savings. Then teach them the importance of giving by having them donate a portion of their funds to a charity of their choosing. Allow them to spend the rest.

• Help them distinguish between needs and wants. With older children, you can do this by giving them shopping practice. You could give them a list of things they need, like new clothes, and a budget to shop for these items online. They will have to decide how best to use their limited resources. Should they buy the designer jeans they really want or a lower-priced option that lets them get everything on their list? With younger children, you might instead have them compare the costs of preparing meals at home (food being a need) to ordering from a restaurant (a want).

• Give them firsthand experience with saving money. Many banks let you open savings accounts online. Set one up in your child’s name and have them monitor it. By the time they become teenagers, the benefit of saving regularly will be apparent because they will have some money to spend on clothes, food and experiences with friends—and still save for college.

• Involve them in creating a financial mission statement for your family. Ask them what they think is important: Is it planning for a future vacation, saving for college or other goals? Having an open conversation with your children encourages them to think about the meaning of money, the challenge of earning it and the importance of saving for what they truly value.

• Underscore the importance of giving. Explaining to children that other people have less than they do and teaching them to give and volunteer helps develop financial discipline as well as empathy toward others. This will help them stay focused on what is truly important, which can have a profound impact on their finances and every other aspect of their lives. For more tips like these, visit letsmakeaplan.org. Your Certified Financial Planner professional can also suggest educational resources for teaching your children financial literacy.

To make the most of your time with your children while they are at home, reinforce the practical life skill of good money management.

Find your latest news here at the Hemet & San Jacinto Chronicle

Search: FAMILY LIVING

The post Learning at Home: 5 Tips for Teaching Children Financial Literacy appeared first on The Hemet & San Jacinto Chronicle.

Each year Wall Street watches the first five trading days of the market to get a pulse of what’s in store. Historically this sets the course for the year and what to expect. Last week the market ended up despite falling back after the news broke regarding the drone attack on Iran’s “General” Qasem Soleimani. Volatility jumped with this news.

The General was widely known in the Middle East and loved as the marches and funeral procession have proven. Labeled a highly dangerous terrorist he took credit for over 600 American deaths. What isn’t known is how this situation will proceed. Fear of it escalating into a military conflict is now listed as a higher possibility of headwind in 2020. We are reiterating to overweight the defense sector this year. Backed with the substantial increase in funding by the Federal government’s budget these companies have contractual guarantees of revenue. Add in any conflict and this sector should be well positioned.

It will join other headwinds in 2020 which include a slew of leading economic indicators that have been contracting and or slowing. In January economic reports to watch include manufacturing, unemployment and labor reports, and gross domestic products. This joins a broader view of external influences on the global economy which is showning signs of continued slow growth. Europe in particular is expecting to turn the corner by 2021.

Many analysts are calling for foreign stocks to outperform domestic equities. A well-balanced portfolio always makes sense if it matches your risk objectives. Keep in mind there are differences between developed countries and emerging ones. Developed countries have an established modern economy and less risk of government toppling or other risks that may impact trade. Emerging countries are opening their system to new economies and modern goods to their citizens. All of these populations are potential customers to new business concepts versus a population that already has competitors in the market place that offers those goods or services. They also have risk of government, currency and or fraud.

January is always a great month to rebalance or revisit your portfolio goals and objectives. Take time this month to check your allocations and what areas of the market may outperform and deserve to be over weighted. The same goes for areas you think will underperform the market. Underweight these areas in your portfolio. Just to revisit what weighting means. Weighting a referenced used to compare a portfolio’s positions compared to the indices it is positioned to perform like. The S&P 500 is made up of so many companies in the medical field, technology or transportation. So, for example the technology companies could make up 20% of the S&P500 index. That would be its weighting. If you have a 25% weighting it would be over weighted and if it was 15% in your portfolio you would be underweighted. Revisit how your positioned. Get focused in 2020.

If you have questions on a particular company or investment and would like our feedback, contact us at my email below. Our team will research and respond to you with our recommendation and opinion.

Andrew F. Kotyuk, CIMA* is CEO and Principal of Alpha Wealth Management LLC. For questions or investment topics please email me afkotyuk@alpha-wealth.com.

Find your latest news here at the Hemet & San Jacinto Chronicle

Search: A Fiery Start

The post A FIERY START appeared first on The Hemet & San Jacinto Chronicle.

Earlier this year for many months the market saw interest rate inflect when the shorter-term treasuries paid a higher rate of interest than the 10-year treasury. This has been a leading indicator of a recession. Since then it has been widely debated on if the U.S. economy is headed into a recession or not. A response from the Federal Reserve was warranted with three interest rate reductions. Federal Chairman Powell stated that this was mid-cycle adjustment needed to support momentum in the market. Leading Economic Indicators (LEI’s) show the U.S. economy has slowed since the beginning of the year. What hasn’t slowed is the labor market which continues to tighten. It should be noted though that the unit labor cost has peaked recently signaling higher labor costs, lower productivity and declining profit margins. A positive thought was a higher than expected GDP report last month. Expectations were at 1.5% and it actually beat coming in at 1.9%.

Wait and see is where most money managers and economists are at. Even Chairman Powell expressed there would be no more rate increases in a hawkish statement. Is this enough to avoid a recession, increase inflation and continue the bull run. The GDP reports seems to indicate but the labor market seems to be signaling a slowdown. Many eyes are waiting for new economic reports to show an improvement or a further erosion.

New records are being made as major indices have made new highs. November and December are typically some of the best months in the year for the market. With a Phase I trade agreement on the table it seems the market will be full of profits this year. I am still very cautious. I don’t like the inflection earlier this year, the decreasing leading economic indicators and the Fed’s confidence they needed to lower rates as a stimulus measure. Let’s face it, that what it is, stimulus.

Currently, there is a surge in confidence and optimism in the market. This is measured by Sentiment Trader’s “Smart Money and Dumb Money Confidence.” Smart Money is made up of insiders from institutional and professional investors, where Dumb Money small odd lot investors and traders. This tracks the behavioral measures. As you can see in the chart, “Dumb Money” confidence has surged where as the “Smart Money” identifies extreme optimism and sniffs a subsequent market pullback. The “Smart Money” and the “Dumb Money” have diverged again.

Whenever you see this overly optimistic feeling with small investors and blatantly negative feelings by money managers it is another sign to be patient and cautious. 

If you have questions on a particular company or investment and would like our feedback, contact us at my email below. Our team will research and respond to you with our recommendation and opinion.

Andrew F. Kotyuk, CIMA* is CEO and Principal of Alpha Wealth Management LLC

For questions or investment topics please email me afkotyuk@alpha-wealth.com.

Find your latest news here at the Hemet & San Jacinto Chronicle

Search: Divergence of confidence

The post DIVERGENCE OF CONFIDENCE appeared first on The Hemet & San Jacinto Chronicle.

November 11 is Veteran’s Day and I urge everyone to thank those who served our country past and present. This includes spouses and family members who supported their family members. Military life is very difficult for families during service and especially for those who “gave all.”

As a U.S. Navy veteran, I can relate to these feelings and appreciate them. Our country’s freedom, bravery to protect other’s and natural beauty is one of a kind. The world power since WWII, our country has worked to alleviate global problems and keep world order. It hasn’t always been easy. Typically congress and the White House get the applause. It is the front-line men and women that deserve all the thanks.

This isn’t often the case: unfortunately the norm is reduced military benefits and pay.

The adopted budget for 2020 is $738 billion, which is the largest approved in over 5 years. Beefing up our forces and modernizing our weaponry seems to be on many minds as this budget passed congress “as a conservative budget.”  The more aggressive budget of over $750 billion was shot down. I believe this parallels the strong national support for fair trade and for protecting our national and industrial intellectual property.

This shift nationally has also influenced the national spot light at the United Nations. Recent speeches there focus on urging allies to increase their national military spending as well. This, along with technological change such as drones and cyber-warfare, long range missile caches of unfriendly nations, and nationalist popularity, are among the reasons why I am giving greater investment weight to military and defense companies for 2020.

Here are some of the plays: Northrop Gruman (NOC) “aerospace and cyber”, Hexcel (HXL) “advanced composites such as carbon fiber”, Raytheon (RTN) “missiles and radars”, General Dynamics (GD) “aerospace and defense systems”, Leidos Holding (LDOS) “cyber security” , Transdigm (TDG) “drones”, Huntington Ingalls Industries (HII) – “shipbuilding” and Kratos Defense and Security (KTOS) “drones and defense electronics.”  These companies receive the bulk of their revenues from government contracts with Departments such as the Pentagon, Civil agencies or the intelligence communities. The SPADE Defense Index is on the offense as the Department of Defense budgets are making up for lost time. The new budget orders new fighter planes, warships and other equipment. They have the green light and so should your portfolio.

I will cover this sector more in coming months and will also provide exchange-traded funds for this sector. As always, researching what to buy and at what price is always recommended. What I like about this sector is that it is also defensive and many of the names pay big dividends.

Show your patriotism to those who served to protect and protect your portfolio with some patriotic military spending in 2020.

If you have questions on a particular company or investment and would like our feedback, contact us at my email below. Our team will research and respond to you with our recommendation and opinion.

Andrew F. Kotyuk, CIMA* is CEO and Principal of Alpha Wealth Management LLC

For questions or investment topics please email me afkotyuk@alpha-wealth.com.

Find your latest news here at the Hemet & San Jacinto Chronicle

Search: Proud to be an American

The post PROUD TO BE AN AMERICAN appeared first on The Hemet & San Jacinto Chronicle.