Spending on Healthcare: How does the US and other countries compare?

Presented By Mark Phillips

How do we do at getting health care here in the US and do we get a good deal compared to other countries?

Based on figures published last week by the Organization for Economic Co-operation and Development (OECD), the overall picture is one in which developed countries spend an average of 9.3% of total income on health care. The below interactive tool will allow you to investigate by country against the overall average for

·         Life Expecatance

·         Health Expenditures

·         Health Risks

What Does The FED Actually Do?

By Nick Bautista

As follow up to my last article on the FED, I figured I would explain what exactly the FED is and does…

Born out of the 1913 Act the Federal Reserve Board was created.

The Federal Reserve System, or more commonly known as the FED was created to carry out monetary policy. The FED is made up of the Board of Governors (7), including the Federal Open Market Committee (FOMC) which is made up of 12 different national banks of which 5 members are able to vote on monetary policies even though the 7 members of the board have the majority.

The objective of the FED is to maximize employment, keep prices stable, and oversee long term interest rates.

The FED has three tools to enact monetary policies to keep inline with their objectives. These are not to be confused with Fiscal Policy. Fiscal policy is enacted by Congress, which is why it is always easier to get monetary policy done.

1. Open Market Operations - Buying or selling treasury securities in the open market. When the FED buys they look to create other buying (liquidity) mainly from consumers. This is the primary tool the FED uses to impact interest rates. More importantly this is currently what the FED is doing. (anytime you hear about the FOMC this is what the committee is discussing)

2. Setting Federal Funds Rate or Discount Rates - Make short term loans, each of the 12 National banks lend to their respective areas. This is bank to bank transactions. When banks are in a bind they need money fast so by keeping rates low, banks can lend a lot or vice versa. This in turn gives those more local banks more or less money to lend to consumers.  

3. Setting Reserve Requirements - Set the reserve required for each bank. This also allows banks to hold more or less in bank reserves, allowing more lending capability to consumers.

In short to see what the FED is doing just follow the money. If the FED is buying, they are trying to stimulate the economy; if they are selling then they are trying to curb the economy from accelerating to fast.

Who Cares about the FED?

Presented By Nick Bautista

The news from notes of the FOMC meeting of possibly, maybe, could be, sometime (you get the idea) ... tapering off their bond purchases seemed to spook investors a couple weeks ago, and the market dropped 4%. Last week, FED Chairman Bernanke spoke about his desire to keep the bond buying program going until the end of 2013, in order to confirm the recovery is strong enough.

The market again reacted, this time it reached fresh gains and recovered what was lost by the wayward notes by what the committee had initially said a couple weeks ago.

Why in these warm summer months of beach going and grilling must we find something to keep us entertained? Have investors stooped so low that they need to read the notes of the Federal Reserve board meeting and react in an irrational way? The answer appears to be yes. But behold this does not have to be you!

To me, it comes back to fundamentals. If you have ever coached or played any sport you know the key to a good/strong player is that person’s fundamentals. The fundamentals in terms of our economy are that the market is becoming strong enough to stand on its own feet. With unemployment dropping and housing the main driver of our recovery increasingly getting better, the economy has been on a steady climb up. The FED appears to be pulling out of the market for this reason.

Instead of obsessing about what the FED will do next, just know they are not supporting our economy because our economy is strengthening which is of course a good thing.   

So go outside and enjoy the nice summer weather. There is no need to read the headlines and let The FED ruin your good time or better yet your financial plan. 

Memory: Is Mine Normal?

Presented by Mark Phillips

How is your memory these days? Do you remember your grocery list from last week or even the name of a friend you met a month ago? In this AARP magazine article, we find that approximately 5.4 million Americans suffer from Alzheimer’s disease, and researchers predict the number will nearly triple by 2050. These should be startling statistics but the good news is there is hope to improve cognitive function with proper rest, nutrition. To read more please click the article link below.

Click here for article