By: Edward Leone Jr. CFP RFC DMD MBA
Contact Information: 303-478-6793 edleonedds@gmail.com
Here we are in the month of December at the near end of another tax year. It is important before the month’s end to do some income tax planning if appropriate as follows:
Take assessment of capital gains and harvest capital losses to neutralize gains where appropriate.
Although there is still some time, consider contributions which are deductible to IRA and 401 K retirement accounts.
Make the appropriate charitable contributions.
Gifting of appreciated assets may be a way to avoid taxation and shift income to younger generations.
Begin to gather appropriate documents and records for tax filing.
On Monday November 30th, the IMF included the Yuan (China’s currency) in its basket of reserve currencies. China is the second largest global economy, but the Yuan is not broadly used in international trade transactions nor is the Chinese bond market very established. It will take some time before this IMF move has impact on global trade and the US dollar. There is much speculation on the potential positives and negatives of this initiative. It certainly raises the status of China in global affairs; however, many of us are not confident in the quality and accuracy of China’s reporting of its economic activity.
BACON!! I LOVE BACON!! You may have read somewhere that the World Health Organization through its IARC (International Agency for Research on Cancer) has classified processed meats such as bacon as Group One cancer causing agents. According to Dr. David Efrig Jr., the studies which lead to this conclusion are deceptive. We have been through such alarms in the past with both eggs and coffee which are now considered beneficial for consumption. It would appear to me that consumption of bacon in moderation should be of little or no threat to general health as is the case with so many other foods we intake.
This past week the US Department of Labor released the jobs report for the month of November. There was an increase of 211,000 jobs which was as predicted. This may give the Federal Reserve Bank the reason it needs to bring an increase to interest rates. We shall see if and what impact this move may have on bond and equity markets. It is stated that the unemployment rate is steady at 5%, but also consider the report that 94 million who are available to work, but have stopped looking for work are not counted in the unemployment calculation. There are some concerns about the viability of holiday retail sales as a measure of economic activity. We need to understand that two thirds of economic activity is a result of consumption spending. Existing and new home sales are up and US GDP growth is at 2.1% for the 3rd quarter of the year. The economy is growing, but at a very very modest rate. It will be interesting to see 4th quarter and annual numbers when they become available in January. I am not optimistic for a significant advancement of economic activity soon with the status of US GDP activity and the status of the global economy considering the challenges faced by Europe, Japan, South America, China, India and the conflicts existing in the Middle East.
Please accept my wishes to you, the valuable readers of this blog, a Merry Christmas and a Happy New Year!
For The Record:
DOWJ 17,847.63
S&P 500 2,091.69
NASDAQ 5,142.27
Suggested Reading: “Big Book of Retirement Secrets” by Dr. David Eifrig Jr.
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