Tag Archives: dawn j bennett

The Bigger the Bubble: Delving Deeper Into Competitive Devaluation

In anticipation of the FOMC meeting two weeks ago, the markets tumbled. The Dow dropped 582 points, or about 3.3 percent, and the S&P 500 lost 3.9 percent, 79 points. For the S&P, that was the steepest decline since the August 2015 correction. According to an article by Dawn J Bennett, “Investors are starting to understand that credit is tightening, as is monetary policy. Earnings are weak, and speculation about the actions of Janet Yellen and the FOMC this week added to the uncertainty. Of course, the FOMC did walk away from their zero interest policy, raising the Federal Funds rate for the first time in nearly a decade by 25 basis points, but will Yellen be able to make it stick? Worldwide, five central banks have raised interest rates since the financial crisis, and all of them were forced to reverse that decision almost as quickly as they made it. This could easily happen in the U.S. as well.”

Even this small hike could create a dangerous situation for the Fed and Europe, when the markets are finally beginning to sell off for everyone. When the U.S. Federal Reserve released its discount window documents in 2011, it became clear that most U.S. quantitative easing funds went to foreign banks in the European Union. In 2012, when the European banking system was at its worse. The Fed coordinated with the ECB to announce QE3 to help prop up the European banking system. Central banks work together globally to maintain stability but when things start to become difficult, they begin to look out for their own interests; this is when competitive devaluation of currencies starts.

“I believe that the cooperative relationship between the Fed and the ECB may be set to break down,” said Dawn J Bennett. “The Euro comprises 56 percent of the basket of currencies against which the dollar is valued, and Europe holds over $9 trillion in U.S. dollar denominated debt, which is called the U.S. dollar carry trade, and the FOMC move to raise interest rates could easily cause fault lines throughout that trade. Investors need to keep an eye on ECB monetary policy in the next months, because their actions carry significant impact to us in the United States.”

She continued, “We really do seem to be in an echo of the ’07/’08 crisis, and one that has the potential to be exponentially worse than that event. In 2007, the Bear Stearns High Grade Structured Credit Fund started to show signs of trouble, which eventually led to an emergency loan from the New York Fed than ultimately failed to save the company. Just as Bear Stearns froze redemptions on its credit hedge fund in 2008, two big hedge funds (Third Avenue and Stone Lion Capital) have done the same in the last few weeks. Add that news to the increased volatility resulting from commodity and energy selloffs, and we should be seeing a big red flag for risk assets. ”

Read more from Dawn J Bennett here: http://www.releasewire.com/press-releases/dawn-bennett-writes-article-the-bigger-the-bubble-regarding-the-recent-drop-in-markets-650714.htm

Latest Republican Debate Offers a Better View of Fiscal Policy

One of the major complaints about the recent Republican debates has been that many of the issues tackled by the candidates have been incredibly topical. Indeed, there was a great deal of backlash after the first debate by everyone from left-wing pundits to financial analysts like Dawn J. Bennett. According to critics, a large number of the candidates had devolved into name-bashing and lacked a substantive punch. However, there has been some progress since.

Republican debate candidates
Image courtesy of REUTERS/EVAN SEMON

Despite some truly comical questions from the moderators in the third debate, certain fiscal stances were established and a conversation on the topic was at least started. In the most recent fourth debate held in Milwaukee, WI, on November 10th, some of these economic issues and the envisioned policies to deal with them were fleshed out a bit more, at least by some. Here are two of the more important topics that were spoken about at the debate:

Minimum Wage

Whether or not raising minimum wage would harm the economy was a highly contested question at the recent debate. While John Kasich, the current governor of Ohio, claimed that his state has implemented a somewhat higher minimum wage, citing that “people need help,” Ben Carson and Donald Trump were both staunchly against any government controlled increase.

Fellow candidate Marco Rubio elaborated on his stance, saying that “If I thought that raising the minimum wage was the best way to help people increase their pay, I would be all for it, but it isn’t. In the 20th century, it’s a disaster. If you raise the minimum wage, you’re going to make people more expensive than a machine.” Instead, he argued for more vocational education in order to create and fill higher-paying jobs.

Bailouts

On the subject of bailouts, Kasich was also on the side of occasionally helping out banks and other institutions that were failing, based on an assessment of the patrons of these banks and who could afford to lose the money. Ted Cruz took issue with his stance, and called for a return to the gold standard and for the Fed to act as a last resort lender.

Marco Rubio lamented a system that he believes allows small banks to be kept mired in regulations, while larger banks simply hire teams of lawyers and work around the rules. He suggested a repeal of the Dodd-Frank Act (Obama administration regulations intended to keep banks from becoming too big to fail), as he deems it to be helping big banks to get bigger. Ben Carson similarly called for policy that wouldn’t allow these banks to get so large in the first place, but held back from saying that these banks should be broken up.

This debate has certainly provided more answers to the questions on everyone’s minds than the prior ones. However, whether knowing what the candidates have to say about monetary policy will actually effect any change is another matter.

Dawn J Bennett Interviews Chris Duane, Author and Self-Made Millionaire

Dawn J Bennett of Financial Myth Busting recently interviewed Chris Duane, the founder of Sons of Liberty Academy, U.S. Marine, venture capitalist that made him a self-made millionaire by age 30, as well as a YouTube sensation. He also wrote the book, “Thrivalist: How To Survive After The Collapse”. Duane doubled his wealth several times during the Great Recession. Dawn Bennett begins the interview by asking him about his backstory, as well as his strategy during the Great Recession.

“I was a part of a family business that was very successful, and I’m the second generation,” said Duane. “And I saw in 2005 that the economy was too good. I woke up very wealthy and wondered why things weren’t always this way, and it actually scared me. And it made me start questioning how things were so good. I mean, the property value of my house had doubled in three years, our sales were going through the roof, and I started to question that reality, and what I found scared me, saved me, and ultimately it made me a lot of money. I found that our entire economy is built off of debt, and that our money is actually debt, and it was a weird thing for me to have so much of it and have very little understanding of the very nature of our money, and this is something that your listeners have got to understand; every dollar that comes into existence is backed by a dollar’s worth of debt plus interest.”

Duane described the fact that the entire economy is backed by somebody else’s debt – from credit cards to treasury bonds to mortgage payments. When debt is created, money is created; when debt is paid off, money is destroyed which is why our federal government’s debt continues to rise. Debts continue to grow because our monetary base is growing.

Duane continued, “So I saw in 2005 that the only reason why the economy was doing well was because there were so many baby boomers taking out so many mortgages, buying all these investment properties—it was creating a lot of money and it was flowing through the economy, to the restaurants and businesses and through the regular economy. But I saw that it was unsustainable, because I saw that at some point, I couldn’t even afford to buy the house that I had bought four years ago, because the property prices had gone up so much, because everybody was doing it. And it was as a direct result of the Federal Reserve, which is a privately owned bank.”

“I recognized that things were growing too good, and I got out. I sold everything. I sold all my stocks, I sold my house, I sold my business. I got out, and I invested everything into gold and silver, because I just looked, and what else could I put it into? And trust me, none of my business partners or my family was happy that I did all this stuff, but it was the ultimate deciding factor in making me financially independent now.”

Dawn J Bennett brought up the fact that the Fed quietly revised their total U.S. debt from 330 percent to 350 percent of GDP and Chris Duane wasn’t surprised. “…the United States federal debt has been frozen since March at $18.2 trillion. We literally have had it frozen for months, and nothing seems to happen. And the reason why is because the people who do know profit off of it.”

Read the full interview between Dawn J Bennett and Chris Duane here: http://www.releasewire.com/press-releases/dawn-bennett-host-of-radio-show-financial-myth-busting-interviews-chris-duane-founder-of-sons-of-liberty-academy-and-author-638283.htm

44 Years Later: The Nixon Shock Goes to China

By Dawn J Bennett of Financial Myth Busting

Richard Nixon’s presidency is known for a lot of things, but lost amid Watergate and the Vietnam War is one of his most influential decisions as a president, which happened 44 years ago in August. On August 15th in 1971, Nixon cancelled the direct convertibility of the US Dollar into gold, effectively ending the gold standard for the United States and most of the world. While it may not seem like there have been any lasting effects of this move, if you dig a little deeper, you can see the ripple effects clearly.

The Gold Standard began in 1944, thanks to the Bretton Woods agreement, named after the city in New Hampshire where many of the world leaders met to formalize how nations dealt with currency exchange on a global level. Things changed in 1971 when foreign pressures demanded the US Dollar to be exchanged gold. Nixon acted against this “price gouging” by ordering Treasury Secretary, John Connally, to suspend this exchange practice. The move was initially supposed to be temporary, but Richard Nixon never re-opened the dollar-for-gold exchange, which was partly responsible for the conversion to flat currencies, which were determined by national governments and their national banks.

Not long after this decision, the Oil Crisis hit in 1973, along with 11 other financial crises since the move away from the gold standard. In contrast, between the Bretton Woods agreement and 1967, there was only one financial crisis and that involved the British Pound. During this time, there were also no bank failures or Wall Street disasters. History tends to repeat itself. Nixon believed that our economy could sustain itself indefinitely. This sort of attitude mirrors the same sentiment seen in the years leading up to the Great Depression.

Nixon’s decision to move away from the Gold Standard has bigger ripple effects than what appears on the surface. When it comes to the economy, it takes a little digging before the full story develops.

The Current State of the Stock Market According to Expert Michael Belkin

The state of the economy hasn’t seemed too certain in the last few years. The recession hit us hard, and the lingering effects have kept investors on their toes, constantly wondering what’s next. And while many analysts will tell you that the stock market has improved a great deal and that there is plenty of reason to assume that the trend will continue, experts like Michael Belkin disagree.

Recently, Belkin, a hedge fund consultant and well-known financial expert, was interviewed by Dawn J. Bennett for the radio program Financial Myth Busting. During the Q&A, Belkin expressed concerns that the stock market in the U.S. looks healthier on the surface than it appears. He claimed that, essentially, certain incredibly well-performing stocks are making the overall market look good, while individual stocks and whole sectors are underperforming. This trend and the false confidence that it builds could lead to an economic slowdown.

Here are some of Belkin’s thoughts on the matter:

economic crisis conceptI think people are being drawn into a false sense that the stock market is okay. Really, it’s a bubble. There’ve been bubbles in Japan, China, the US, and Europe, and really they’re not really going up anymore. Yeah, there was a new high in the NASDAQ, but I think we’re past the peak in the indexes in China and Japan and in Europe. They’ve been going down for a few weeks or a few months. And . . . there’s a story in Sunday’s New York Times called ‘The Economic Forecast for 2016: What it Means for the Election’. Of course, the people who are in power are trying to turn the dial and pull the levers and dangle the strings and make the puppets move, so that the economy looks good for the elections. That’s the game plan in Washington DC, in your neck of the woods. But I don’t think it’s going to work. I think this economic cycle is 73 months long, which is tied for the last economic expansion, which is about 30 months longer than the normal economic expansion.  . . . [Industrial] production is turning down, retail sales, rate of change is going down, and while the planes are still full of people . . . the industrial component of the economy has turned down. China, the economic growth is plunging. Emerging markets that used to export to China are not sending boatloads of iron ore to China anymore, so US exports to emerging markets are falling. The dollar is strengthening; that’s bad for corporate profits. I think we’re in kind of a slow decline that will accelerate into a contraction, economic contraction, which usually lasts about 18 months.

If he’s right, this could signal another dip in the economy, leading to falls in GDP, household and disposable incomes, commercial profits, and investing, and higher unemployment and bankruptcy rates. Whether that slowdown could stretch out long enough to qualify as another recession remains to be seen.

Belkin predicts that the country may slip slowly and eventually fall into contraction or recession. He has also expressed concerns over bailouts and the interference of central government banks and their role in this process. Belkin claims that the Fed is out of touch with the economic cycle and that by trying to force the system to move in a direction, they have only ensured that they are left behind by it. However, he does believe their involvement may be the thing that keeps a sudden recession from occurring, since the Fed is so rigorously trying to avoid that eventuality. He emphasizes, however, that they won’t be able to stop the natural progress of the economy – merely stall it.

Is Gold a Good Place to Hedge Investment?

Gold has always been a more difficult to track and understand resource in the economy.  This has kept many investors at bay when it comes to investing in it, for fear of it how unstable it appears at times.  Dawn J Bennett recently had Jeff Snider, Head of Global Investment Research for Alhambra Investment Partners, on her radio show and Jeff helped illuminate us on how gold needs to be viewed in our current economy.

First, here are the important facts to give you some background.  In 2011, gold was approximately $1900 an ounce and today it is around $1180 an ounce.  That’s quite a big shift, so naturally there are a number of questions regarding why the price has changed so much in a commodity considered as valuable as gold.  Snider explains to Dawn J Bennett and us that gold was so extremely high back then because of the lack of confidence in the stock market and economy as a whole, so people invested in gold because it was considered more secure.  So as the economy has improved a bit the value in gold has collapsed, but now there is a new question.  Is the Fed currently suppressing the price of gold to make the dollar look stronger?

If they are doing this then we could be deceived by how well the economy is actually doing because they don’t want us to realize how poorly the economy is actually doing.  Snider says it’s rather difficult to be certain where the price of gold is being affected because of how the selling side is a wholesale system.  The issue is, when people buy gold, it’s against extreme risks and right now there is less fear in the market, so there is less buying.  Part of this less fear issue is because of the positive job market results which the government has been giving out each month.

Unfortunately, these positive job results are a bit misleading in the way they report their numbers.  They aren’t telling us how many of the jobs are full-time versus part-time and we don’t know how well paying they are.  So even if we are adding jobs, if they don’t pay well then it’s hard for these workers to make ends meet and contribute.  Wage growth has nearly flat lined for several decades now, too, making it difficult for regular people to keep up with inflation and the rising cost of living.

So without a doubt, we know the economy isn’t doing as well as is being reported in the mainstream, so perhaps right now is a good time to invest in gold while it is still cheaper.

Bennett Group Financial Services LLC, based in Washington, D.C., is a comprehensive financial services firm committed to providing opportunities to clients’ as they seek long-term financial success. Its customized programs are designed with the potential to help grow, lower overall risk and conserve client assets by delivering a high level of personalized service and skill.
For more information, call 866-286-2268 or visit http://www.bennettgroupfinancial.com
Securities offered through Western International Securities Inc. (WIS), member FINRA/SIPC. BGFS and WIS are separate and unaffiliated entities.
About Dawn Bennett
Dawn Bennett is CEO and Founder of Bennett Group Financial Services. She hosts a national radio program called Financial Myth Busting http://www.financialmythbusting.com
She discusses educational topics and events in the financial news, along with her thoughts on the economy, financial markets, investments, and more with her live guests, who have included rock legend Ted Nugent, as well as Steve Forbes and Grover Norquist. Listeners can call 855-884-DAWN a as well as take podcasts on the road and forums for interaction.
She can be reached on Twitter @DawnBennettFMB or on Facebook Financial Myth Busting with Dawn Bennett ordbennett@bennettgroupfinancial.com

Educating Americans on Free Trade

The news cycle of late has returned to the Trans-Pacific Partnership free trade deal or more commonly known as the TPP.  The deal has been a very contentious issue in the eye of the public and has created quite strange bedfellows on Capitol Hill.  As it stands now, four out of five American voters, including independents, Democrats and Republicans, hold the belief that we should be “buying American” because it creates U.S. jobs.  Unfortunately this isn’t the most productive use of our hard earned money and it doesn’t bring the benefits to the economy that we would like to see.

People fear imports because they think it will send all of the American jobs overseas.  The reality is it will only send the jobs which can be done cheaper after shipping and everything else has been calculated in.  Plenty of American manufacturing jobs are more efficient here and produce better products here for a near equal price therefore they won’t go overseas just because we have a new free trade deal.  Furthermore, even if we spend money on foreign goods say Japanese cars, the Japanese then take that money and spend it on investments in America or spend it in America.  Which means the money comes back and creates jobs here.

Dawn J Bennett has been surprised by Americans lack of education on this topic and brought Don Boudreaux on to her radio talk show to discuss the TPP in greater detail and explain how it can help Americans and improve the American economy.  Boudreaux says one of the reasons we see a lot of members of Congress against the TPP is because it may mean a loss of jobs for some people in their region.  However for America as a whole there will be a net benefit and this is the bird’s eye perspective that President Obama is viewing the TPP from.  Unions have also made the TPP out to be some sort of evil jobs killer because they are afraid of having to face more competition in the past which may mean giving up some of the benefits they’ve had.

Another major concern for many Americans is the issue of the deal being fast tracked, but once again there is a lack of understanding about what this means.  The deal being fast tracked means while details are being discussed about the TPP they aren’t under the constant scrutiny of Congress and narrow focused politicians who are only thinking about their regions.  Even when the deal is done though, it will still have to go before Congress where it will be reviewed and voted on.  This means no ‘fast one’ can be pulled on the American people and everyone will have a chance to actually see the details of this agreement.

Many Americans are also worried the TPP will give corporations too much power over a country’s government and their laws.  There is also a question of whether this trade deal will only benefit special interests and be another slap against Main Street and due to the current secrecy on hammering out details on the TPP rumors such as this have run amuck.  If any of these issues are as severe as news pundits are predicting when the deal does get revealed then Boudreaux says Congress will hopefully make the right decision and not pass the deal.

One of the most important benefits is the strategic leverage it will provide America in East Asia.  The biggest controversy of the TPP now is whether Malaysia should be allowed due to the issue of slavery existing in the country.  What many Americans don’t realize is that a large percentage of world trade passes through the straights surrounding Malaysia and maintaining a strong U.S. presence there helps protect American and international interests from being engulfed by China’s recent power expansion.  Hopefully, more Americans will educate themselves on the effects of free trade and begin to understand the widespread benefits it will bring in the long run.

Bennett Group Financial Services LLC, based in Washington, D.C., is a comprehensive financial services firm committed to providing opportunities to clients’ as they seek long-term financial success. Its customized programs are designed with the potential to help grow, lower overall risk and conserve client assets by delivering a high level of personalized service and skill.

 

For more information, call 866-286-2268 or visit http://www.bennettgroupfinancial.com

Securities offered through Western International Securities Inc. (WIS), member FINRA/SIPC. BGFS and WIS are separate and unaffiliated entities.

About Dawn Bennett

Dawn Bennett is CEO and Founder of Bennett Group Financial Services. She hosts a national radio program called Financial Myth Busting http://www.financialmythbusting.com

She discusses educational topics and events in the financial news, along with her thoughts on the economy, financial markets, investments, and more with her live guests, who have included rock legend Ted Nugent, as well as Steve Forbes and Grover Norquist. Listeners can call 855-884-DAWN a as well as take podcasts on the road and forums for interaction.

She can be reached on Twitter @DawnBennettFMB or on Facebook Financial Myth Busting with Dawn Bennett or dbennett@bennettgroupfinancial.com

The 2016 Presidential Race Has Begun

With candidates for both the Republican and the Democratic parties having thrown their hats into their respective arenas the scrutinizing of these candidates can commence.  A lot of questions regarding social issues, economic matters and foreign policy are going to be blazing from all sectors of the spectrum, but today we are going to focus on what should be the number one issue; the economy.  The economy despite the “good job reports” isn’t actually as healthy and strong as we would like to believe.  Our trade deficit is at its highest in the last six years and numerous other important indexes, such as the Baltic dry index have been giving less positive reports.

Financial myth buster expert Dawn J Bennett is looking to cut through the new Republican candidates for president and see which ones will be true free market capitalists.  In order to helper her sleuth through the candidates rhetoric and their values she invited Jonathan Hoenig, a founding member of Capitalist Pig and a regular contributor on Fox News’ Cashin’In, Your World with Neil Cavuto.  Dawn J Bennett decided to focus her questions on Rand Paul and Ted Cruz and whether or not they really believe in free market capitalism and would have the gumption to push for changes that help bring the U.S. closer to this ideal.

Jonathan says he’s hopeful about both candidates but said there will be a lot of work for them when trying to achieve this goal.  To obtain free market capitalism the first thing that will need to happen is the repeal of the IRS, Medicaid and Medicare.  He says he’s been hearing people talk about repeal of the IRS and believes that it should be replaced with a flat tax that hits all Americans equally.  This will remove the loopholes within the current system and make it far fairer; it will no longer server as a system for wealth redistribution.  At the same time it would eliminate large chunks of government bureaucracy which would reduce costs on the government and help get it out of every part of people’s lives.

As for Medicare and Medicaid, Jonathan is less positive on those fronts.  He believes that too many people still want to keep these government benefits around and  being able to rally enough political support to remove them won’t happen soon.  Dawn J Bennett and he lamented at how both of these programs cause the market to be imbalanced and therefore inefficient.

Dawn then steered the subject towards Hillary Clinton’s recent comment about getting the money out of politics despite planning to raise $2 billion for this upcoming presidential election.  Jonathan said he would be happy to see the money in politics go away but so long as government is so intricately involved in the economy this will never happen.  As it stands now a business can use its money and influence to damage their competition by lobbying because of government involvement in the economy.  As long as this exists businesses will have to be crazy not to get involved in lobbying.  Once we extricate government from the business equation and return its focus to social issues we will see money in politics dry up.

Jonathan and Dawn wrapped it up with how even though discrimination is negative, it is a part of freedom of speech and if businesses want to practice it then they should be allowed.  It is a bad business call and other businesses will gladly take the business those discriminating businesses reject, but to have the government come in and tell businesses what they can and cannot do is a waste of taxpayer money and an invasion of our freedom.

Bennett Group Financial Services LLC, based in Washington, D.C., is a comprehensive financial services firm committed to providing opportunities to clients’ as they seek long-term financial success. Its customized programs are designed with the potential to help grow, lower overall risk and conserve client assets by delivering a high level of personalized service and skill.

For more information, call 866-286-2268 or visit http://www.bennettgroupfinancial.com

Securities offered through Western International Securities Inc. (WIS), member FINRA/SIPC. BGFS and WIS are separate and unaffiliated entities.

About Dawn Bennett

Dawn Bennett is CEO and Founder of Bennett Group Financial Services. She hosts a national radio program called Financial Myth Busting http://www.financialmythbusting.com

She discusses educational topics and events in the financial news, along with her thoughts on the economy, financial markets, investments, and more with her live guests, who have included rock legend Ted Nugent, as well as Steve Forbes and Grover Norquist. Listeners can call 855-884-DAWN a as well as take podcasts on the road and forums for interaction.

She can be reached on Twitter @DawnBennettFMB or on Facebook Financial Myth Busting with Dawn Bennett or dbennett@bennettgroupfinancial.com

Does Hosting the World Cup Help or Hurt the Host Country?

Founder and CEO of Bennett Group Financial, Dawn Bennett, recently reviewed the FIFA World Cup and whether or not it’s worth hosting.  Her review of the benefits the World Cup brings to a country is not hopeful.  According to her, the Brazilian economy is going to be facing trouble once the World Cup is over.  The problem she explains is FIFA doesn’t care at all for the host country’s economy or the costs required for hosting the tournament.  FIFA will pocket a cool $2 billion in profit, but the Brazilian economy won’t see a penny of those profits.  Meanwhile Brazil will have wound up spending well over $318 million just for the stadium that was built for the finals.  Did anyone mention that the stadium isn’t even accessible by road.

Unfortunately for Brazilians, instead of paying attention to the upcoming presidential election in October, their attention will be trained on the World Cup, which means voting for important issues will be out of the media for a long time.  This is dangerous for Brazil because they have had a growing number of financial issues, the same as America.  They are facing high unemployment, dwindling growth, above-target inflation and more.  These are all issues that America is facing as well and is hurting our economy says Dawn J Bennett.  Furthermore, Brazil’s inflation is tumbling further and further out of control.  It rose at a rate of .46 percent in May alone, causing fear with economists and causing them to downgrade the country’s growth forecast.

The US is seeing a similar problem as well, as it continues to grow at a rate of negative 1% GDP says Bennett.  The problem with both economies as Bennett sees it, is they’ve tried to ignore the basic laws of math.  The governments are trying to prop their currencies up to make them look better.  When you look at the skewed reality though of weak economic growth, record-high valuations, incredibly high stock earnings, poor consumer confidence, lack of retail buying and other more you see an economy that is completely unbalanced.

These continued discrepancies should be setting off warning bells for investors.  They should be as vulnerable as the correction of 2008, but with stocks continuing to rocket forward despite stagnant wages, lack of consumer spending and other issues, something isn’t adding up.