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Ponderings For the Week of October 14 to 20, 2019

Apparent Progress in Trade Talks Spurs Gains in Stocks and Interest Rates

Rumors of progress in trade talks augmented by a late Friday announcement that the U.S. and China had reached a “phase-one” trade deal helped stocks to a weekly gain averaging a bit less than 1%. Interest rates also rose a bit which is a mixed blessing, particularly for interest-rate sensitive stocks like utilities. While Wall Street had hoped for a more substantive agreement, anything is better than nothing. Stocks were also helped by encouraging reports on employment and consumer confidence.

Quarterly earnings season looms. Ten percent of the Standard and Poor’s 500 stocks report their profits and outlooks this week, including some biggies in the financial and pharmaceutical sectors. Forecasts will be closely followed as a gauge of corporate management’s concern about the impact of the trade dispute and the possibility of recession over the rest of the year and into 2020. 

Top Five Reasons You Know it’s Time to Trade in Your Car

Cars can be a huge drain on our finances, so I have long advocated holding onto a car for as long as possible. But cars don’t last forever so there will come a time when you have to consider disposing of your old friend. Here are some situations that may call for such an unhappy event:

  1. Instead of an air bag, a whoopee cushion is taped to your steering wheel
  2. 15 Minute Jiffy Lube needs to keep your car for 3 days.
  3. Thieves repeatedly break in your car just to steal the "Club."
  4. Traffic reporters start referring to you by name when discussing morning tie-ups.
  5. While standing at a stoplight, people keep running up to you and asking if anyone was hurt.



Smart Money Tips


  • IRAs for all. Anyone who qualifies should be making annual IRA contributions, even if you are fortunate enough to have a very high income that precludes you from making either a deductible or a Roth contribution. You still qualify for a nondeductible IRA which allows the money to grow tax-free until you have to withdraw it. But a lot of workers of all income levels don’t make IRA contributions and haven’t for years. You should break that bad habit now and you have over five months to do so for this year (until the April 15, 2020 deadline).
  • Where to store your will. Although it is advisable to make photocopies for your files and for family members, there should be only one original copy of a will at any time. Deciding where to keep the original is a vexing problem. Options include a home safe, a business safe, a bank safe-deposit box, your lawyer’s office, a trust company (if one has been named as an executor), or the clerk of your local probate court who will hold it for safekeeping in a sealed envelope. Where you should store your will depends in part on state and local probate law. For example, many such laws automatically seal the safe-deposit box upon death, possibly making the will inaccessible pending a court order and creating a messy complication. Wherever you decide to store your will, always be sure that family members or close friends know its location.   



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