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Provise Bullets
by Team of ProVise Management Group,
In a rare display of compromise and cooperation in Washington, Congress passed the Bipartisanship Budget Act of 2015 which settled the budget battles for the next two years and raised the debt ceiling until the spring of 2017. It adds $80 billion to the budget during that time, split evenly between defense and social programs. It also repeals the auto enrollment provision under ObamaCare and limits the Medicare Part B premium increase to a maximum of 15% which was set to go up as much as 50% for some.
ProVise Bullets
The Republicans in Congress are struggling to find unity. First, the party’s division and very vocal tea party members influenced the Speaker to not only resign, but to leave Congress itself. Although Congress has now passed a bill to keep funding the government until December 11th without an amendment defunding Planned Parenthood, this battle is far from over. In December, Congress will not only have to focus on funding the government, but also will need to address raising the debt ceiling. Do not plan on these issues going away. They will continue to hang over Congress, the election, and t
Provise Bullets
by Team of ProVise Management Group,
The 3rd quarter is now behind us and the major indexes did not fare well through the dog days of the summer. For the quarter the S&P 500 was down 6.44%, the DJIA was down even more at 6.91%, the Russell 2000 was down 11.92%, and the MSCI EAFE index was down 10.23%. The Barclays Aggregate Bond Index was able to post a small gain of 1.23%. Year to date the indexes are -5.29%, -6.88%, -7.73%, -5.28% and +1.13% respectively. As disappointing as these benchmark returns were, a look behind the scenes reveals an even more somber picture.
Provise Bullets
by Team of ProVise Management Group,
There is a big debate within the financial services industry regarding who should be required to be a fiduciary. Basically a fiduciary puts their clients’ interests ahead of their own, a philosophy ProVise has espoused since our founding in the mid-80s. The Department of Labor has proposed a rule which would require ALL who give advice on retirement plans to do so at a fiduciary standard of care.
ProVise Bullets
by Team of ProVise Management Group,
In just a few short days, the comment period will close on a controversial proposal proffered by the Department of Labor (DOL) which would require virtually all financial advisors to adhere to a fiduciary standard of care when giving clients or prospective clients advice on their retirement plans, including IRAs. Ironically, most Americans believe that the advice that their financial advisor provides is already held to this high standard.
ProVise Bullets
by Team of ProVise Management Group,
Okay, so where did the last six months go? Hard to believe that half of 2015 is gone and even harder to believe that we have a presidential election coming up in “only” 16 months. Of course, with all the candidates coming out, especially on the Republican side, it is going to be an interesting 10-12 months while the primaries play out.
ProVise Bullets
As the snow finally began melting in the North, the negative impact on the economy also began to melt away. While the weak jobs number for March was revised downward from 126,000 to only 85,000, the April jobs number bounced back with 223,000 non-farm jobs. Private jobs, primarily represented by services, healthcare, and construction, produced all but 10,000 jobs which were created by government. The headline unemployment number dropped to 5.4%, the lowest since the beginning of the financial crisis in 2008.
ProVise Bullets
Earnings season got started on the right foot with Alcoa, the company that traditionally reports first, handily beating expectations and then company after company following. That is not to say that all companies beat expectations, but many surprised to the upside. Standard & Poors now expects earnings for the S&P 500 companies to come in at $29.12 for the second quarter which is a 10.4% improvement over the $26.36 during the same period last year. S&P is projecting total earnings for 2014 at $119.18 versus $107.30 for 2013, or an increase of 11%. The projection for 2015 is
ProVise Bullets
The June unemployment figure of 6.1% was the lowest in six years. A total of 288,000 new jobs were created and the government increased Mays number to 224,000 jobs created. While the summer can be very volatile, we expect solid gains for the rest of the year. Last weeks applications for unemployment fell to only 304,000, which was below expectations of 315,000. It will be hard for the numbers to keep falling as 300,000 is a very low number even in a healthy economy. The Fed expects job creation for the rest of the year to be steady as the economy continues to improve. It is possi
ProVise Bullets
by Team of ProVise Management Group,
During the Great Recession, America laid off two million factory workers and factory output fell 20 percent. Before the Great Recession, of course, manufacturing jobs were headed overseas. As we have slowly emerged from the Great Recession, its a little surprising to some that manufacturing has led the way, outpacing overall GDP growth. This year it looks like manufacturing could add 3.5 percent in growth. Is this just a replacement of jobs that were lost during the Great Recession?
ProVise Bullets
by Team of ProVise Management Group,
On average, how much taxable income must you have to pay six figures of income taxes? In order to pay exactly $100,000 in federal income taxes, your 2013 taxable income must equal $376,047 on a married filing jointly basis. Twenty years ago, it took $312,363 to pay that much in taxes. In 2011, the top 10% of US taxpayers paid 68.3% of all federal income tax while in 1980 the top 10% paid 49.3%. It is estimated that for the tax year 2013 the government will receive approximately $3 trillion. (Sources: Tax Foundation; White House; Internal Revenue Service)
ProVise Bullets
This month, we sing happy birthday to Apple. It was 30 years ago that Apple introduced its first Mac computer. What was novel then is commonplace today and far less clunky. For those old enough to remember what that boxy looking thing was like, its hard to believe how far weve come. Carl Icahn bought another $500 million more shares of Apple stock, bringing his total investment to $3.6 billion. As an activist shareholder he is trying to force Apple to buy up to $500 million in a stock buyback program.
ProVise Bullets
In late December just before Christmas, the Postal Regulatory Commission delivered an unwanted present in the form of a "temporary" three cent rate hike for first class mail effective January 26th. It seems that the Post Office decided it lost $2.8 billion as a result of the Great Recession and convinced the Commission that it needed to make this loss go away. Well, in reality, the Post Office asked for a permanent hike, but was only given the opportunity to make up the loss and then have the rate go back down. We shall see.
ProVise Bullets
To say that 2013 was an interesting year would be a bit of an understatement. We learned a long time ago not to make predictions about the stock market because no matter what is predicted, it is likely to be wrong. Even if we get lucky one year, we are not likely to even get close the following year. We do try to give guidance, however. Last year we suggested that, given the late run in the market in 2012 and its 15% return, investors should be happy with a return of 8 to 10% in 2013. Obviously, investors enjoyed much better returns.
ProVise Bullets
For the 7th year in a row, the US Postal Service lost money. After setting a record loss last year of $15.9 billion, it pared the losses to $5 billion in the current year. The USPS showed its first growth in revenue since 2008, rising 1.2% to $66 billion. In no surprise, the USPS asked Congress for help. Wonder how that is going to work out for them?
ProVise Bullets
Last month, a Wells Fargo/Gallup survey of non-retired investors showed just how lingering the hangover is from the financial crisis five years ago. Much like the Great Depression financially scared their great grandparents and grandparents, the Great Recession is impacting investors expectations about the future.
ProVise Bullets
Last month, a Wells Fargo/Gallup survey of non-retired investors showed just how lingering the hangover is from the financial crisis five years ago. Much like the Great Depression financially scared their great grandparents and grandparents, the Great Recession is impacting investors expectations about the future. 41% indicated they were concerned about another global crisis during their retirement years, and 28% were convinced they would have a lower standard of living during retirement.
ProVise Bullets
Effective October 1st, the health exchanges are open for business and enrollment can occur over the next 90 days. It will be interesting to see just how many people feel compelled to sign up under the individual mandate. While the premiums are not inexpensive for most of the eligible people, many will receive tax credits to help offset the cost. Nonetheless, others will find it a significant burden to the budget, and there is great debate over just how this will affect the economy long-term.
ProVise Bullets
For those in college during the 60s the time of sex, drugs, and rock n roll its hard to believe that marijuana has become legal. It is currently legal in some form in about 20 states and more are considering it, at least for medical purposes. Even Florida has strong proponents for the medical use of marijuana. There are always people who are trying to take advantage of the situation and this is no exception.
ProVise Bullets
Six years ago, in 2007, the trustees of Social Security projected that Social Security would run out of money, i.e., have a negative balance, in the year 2041. At the end of last month the trustees updated this projection and indicated that the trust fund backing the payment of Social Security would be zero by 2033. A zero trust fund does not mean the payment of Social Security benefits would also go to zero, but would drop to 77% of their originally promised levels through 2087. Is any of this getting Congresss attention? (Source: Social Security Trustees)
ProVise Bullets
As we approach 2014 and ObamaCare starts to kick in, many people are thinking that the healthcare issues in our country will be solved in short order. Only time will tell what the impact of ObamaCare will be. In spite of the Republican Partys continued talk about repealing the law, in the unlikely event repeal were to occur, the aspects of ObamaCare that have already been put in place would continue. In other words, its hard to go backwards.
ProVise Bullets
When the President put forth his proposed budget for the 2014-15 fiscal year which begins October 1st, he went out of his way to offer an olive branch to the Republicans on entitlement programs - especially Social Security and Medicare. The President proposed changing the cost of living adjustments in such a way that, over time, there would be significant savings to the government, but of course, take the money away from the recipients.
ProVise Bullets
There may still be people rushing to the Post Office this afternoon or evening to get tax returns in the mailbox. Of course, many others will file for an extension. The first extension is for six months and is automatic. However, when you file your extension, you have to send in the money you think you will owe and file form 4868. If you dont file an extension, there is a 5% per month late filing fee. An underpayment could also be charged interest, and if the amount is significantly under what is owed there could be penalties as well.
ProVise Bullets
As we began 2013 America was looking ahead to President Obamas second term, the passage of a tax bill that raised government revenue significantly, discovering that fourth quarter growth was virtually flat, corporate earnings that had only a few mild surprises to the upside and several to the downside, and finally, an increase in Social Security taxes of 2%. Then the sequester kicked in in early March, a band aid was used to patch the government together until the end of September, and we saw the nervousness the European markets, highlighted by Cyprus.
ProVise Bullets
With the battle over sequestration going on in Washington, the President has made it clear he wants to raise more revenue. Just what does he have in mind? First, he would like to limit itemized deductions beginning at the 28% tax bracket. This means that taxpayers in the top three brackets would lose some of the benefit of their itemized deductions. Of course, these deductions have a phase out, so the effect may not be as great as is perceived.
ProVise Bullets
So, what is the top tax bracket next year? For couples with earnings over $450,000, it is 39.6%. Oh, no. We're sorry. It's potentially another 1.19% which is the amount that is added to the marginal rate due to the cut-backs in itemized deductions. Therefore, the top tax rate is 40.79%. Oh, no. We're sorry. You could also lose your personal exemptions, which will add as much as another 1.05%, so the top tax bracket is 41.84%. Oh, no. We're sorry. We forgot the Medicare surtax on high wage earners of 0.9%, making the top tax bracket 42.74%. Oh, no. We're sorry.
ProVise Bullets
By now you may have read more than you care to about the changes to income taxes. We avoided rushing to get you something as so many others did, so that we could provide you with some comprehensive and practical information. It is a long read, but we hope you find it to be worth your time.
ProVise Bullets
HAPPY NEW YEAR EVERYONE!We don't know what you did on Monday night to ring in 2013, but the U.S. Senate was in session as they were attempting to avoid the so-called "fiscal cliff".At 2:07 a.m. on New Year's Day the Senate passed a bill, 89 to 8, which does a number of different things.Then late that same morning, the House also passed the bill.We are going to touch on a few of the highlights in this opening Bullet and promise to give a more detailed analysis in our mid-month Bullets.
ProVise Bullets
So help us understandwhere did 2012 go? While we know time really fly, it sure feels like it does when we think that 12 months have almost passed. We want to wish you and your family the happiest of holidays! Please remember the women and men serving in our Armed Forces, especially those overseas.
ProVise Bullets
Last year the post office lost almost $15 billion. You would think that postal rates would be going up, and they are. Effective January 27, 2013, the price of a first class stamp will increase to 46 while a postcard will increase to 33. Both are a one penny increase. Does the post office really think this will make a difference? We hope you have a lot of those "forever" stamps.
ProVise Bullets
With the elections behind us, we must now look ahead to the next six weeks of a Lame Duck Congress. Given the fact that the President was re-elected, the Republicans maintained control of the House, and the Democrats gained in the Senate, we know there will either be collaboration or chaos in Washington. The positioning has already started. The more things change, the more they stay the same.
ProVise Bullets
Hurricane Sandy rocked the East Coast on Sunday, Monday, and Tuesday, causing the stock exchange to be closed on Monday and Tuesday. It has re-opened today, October 31st. More importantly, however, given the strength and size of the storm, the loss of life was not nearly as great as it could have been. To all of our clients, colleagues, friends, family, and others in the region, we had you in our thoughts and prayers and we hope everyone is safe and that any inconveniences caused by the storm are not significant in nature.
ProVise Bullets
Some recent research by InvesTech Research shows that the performance of the Dow Jones Industrial Average can indicate who will win the White House. James Stack, President of InvesTech recently released a study that showed in elections since 1900 90% of the time the Dow has correctly predicted the outcome of the election based on its returns from Labor Day until Election Day. If the Dow posts a positive return during this time period, the party in power keeps the White House and if the return is negative, they do not
ProVise Bullets
The median household income adjusted for inflation is now around $50,000 for a "typical" American family. This is 8% below the all-time high, which was set in 2007. Driving these results, as reported by the Census Bureau, was the fact that 80% of Americans saw their household incomes decline, or at a minimum, remain the same, while the top 20% saw their incomes increase by 1.6%. Depending upon which side of the political spectrum you are on, an argument could be made for the policies of either President Obama or Governor Romney.
ProVise Bullets
by Team of ProVise Management Group,
It is a heads I wintails you lose - scenario for American farmers. Everyone has heard about the drought throughout the U.S. being the worst since the 50s. However, dont feel too badly for the farmers as their net income will hit a record $122 billion this year. How can that possibly be, given all of the crops drying up? Easy. Since the supply is down and demand remains the same, the price has jumped dramatically and has offset the loss of yield per acre.
ProVise Bullets
At one time during the dotcom craze, the NASDAQ closed over 5000, but, as it tumbled downward, it last crossed the 3000 mark on December 11, 2000; that is until it crossed that mark on March 13, 2012, or 11.25 years later. My, how the times have changed! The income tax was introduced in the U.S. in 1913. This means that when we file our taxes on April 15, 2013 for the year 2012, it will be the 100th year that income taxes have been paid.
ProVise Bullets
There are bears out there who are extremely disappointed that the U.S. has not entered another recession over the past three plus years. Certainly, the 18 months of downturn in the markets that began in October of 2007 and culminated in March 2009 gave them a lot to cheer about. But, since then, they have looked everywhere possible to come up with bad news.
ProVise Bullets
President Obamas Affordable Care Act was deemed constitutional by the Supreme Court. This means that unless something happens between now and the end of the year, on January 1st, taxes will go up for certain taxpayers: A 3.8% Medicare contribution tax for single taxpayers making more than $200,000, and married couples filing jointly making more than $250,000. Interest, dividends, rents, and capital gains on these groups will see an additional 0.9% Medicare tax applied to income.
ProVise Bullets
Much has been said and written about the expiration of the Bush tax cuts at the end of 2012. The assumption is that capital gain rates will go back to 20% and that dividends will rise to 39.6% without consideration of the Obama Care surtaxes. Since tax law would revert to what it was before the Bush tax cuts, we would revert to a special provision in the Taxpayer Relief Act of 1997 that established a preferential 18% capital gains rate.
ProVise Bullets
by Team of ProVise Management Group,
If you listened carefully to the CEOs during their earnings announcements, they were tepidly upbeat but upbeat nonetheless, as they looked forward into the remainder of the year. On a day-to-day basis the markets will be driven by the headlines and emotions. We encourage you to refrain from getting caught up in that fray. At the end of the day it will be about an economy that moves forward creating jobs and not one built on the back of debt.
ProVise Bullets
by Team of ProVise Management Group,
What part of leadership are our elected officials in Washington not getting? Last month the Supreme Court heard the case regarding the Affordable Care Act and a ruling is likely to happen sometime in late June. Regardless of how the Supreme Court rules, healthcare reform is a topic which is here to stay. First of all it is estimated that by 2020 healthcare will account for one in every nine jobs in the U.S., adding 4.2 million jobs during this decade. As the Baby Boomers move into retirement there will be a need for an ever-increasing number of physicians, nurses, home health aides, etc.
ProVise Bullets
by Team of ProVise Management Group,
It seems all investors have dividends on their brains these days. Apparently this is also true of corporate boards. Even Apple, which during the second Steve Jobs era did not pay a dividend, decided to use some of its $97 billion of cash for a stock buy-back and for a dividend. Based on a $600 share price, the yield would be approximately 1.8% when it begins paying its $2.65 quarterly per share dividend. The first payment will begin July 1st. The dividend amounts to about $9 billion per year, which is the second largest dividend payment, behind AT&Ts $14 billion.
ProVise Bullets
by Team of ProVise Management Group,
Lets take a few moments to talk about GDP, the economy in general, and investor psychology. the GDP figures for the fourth quarter were revised from 2.8% to 3%. This marks the tenth consecutive quarter of growth, and given everything we know at this point its likely that the first quarter of 2012 will also reflect growth. In other words, we will have 11 consecutive quarters of growth. Fortunately the concept of a double dip recession has faded. Make no mistakethere will be another recession at some time in the future, but it will clearly not be a double dip recession.
Results 1–50
of 147 found.
