Archive for Global Recession

Global Economy Trying to Recover… Michael Douville

Posted in #PaulthePoke, Michael Douville with tags , , , , on May 26, 2020 by paulthepoke

Proverbs 27:23 Know well the condition of your flocks, and give attention to your herds…

The Economy is trying to bottom and start the recovery. GDP is worse than the Great Recession, the damage is widespread and Many retailers and restauranteurs will not recover. However, change will bring new innovation and Huge Investment Opportunities.

Michael continues to watch the global impact of the U.S. Dollar. Diversify your resources and do your home work. Seek a financial adviser.

Click on the link below to get the latest economic news from Michael Douville.

http://www.michaeldouville.com

International Economic Update with Michael Douville

Posted in #PaulthePoke, Prophecy, Trend Update with tags , , , , , on August 20, 2019 by paulthepoke

Proverbs 22:3 The prudent sees danger and hides himself, but the simple go on and suffer for it.

Time to wake up! Pay attention! International markets are changing quickly!

In a few days Argentina’s stocks and bonds took a nose dive. In one session, Argentina’s stock market dropped 48%! Could this be the start of dark times? Click the link below for Michael’s update.

http://www.michaeldouville.com

Michael has been warning people for almost 3 years of a shift in Market Fundamentals. It is finally here. Michael is available to speak on your program or help in any way. He can be reached at 480-948-5554 or michael@michaeldouville.com

http://www.michaeldouville.com

Do you have all your money in stocks and bonds? What happens if we see a sharp reduction in the markets. Have you prepared your life boat? Michael talks about alternate ways to make income without worrying about the markets. Check us out at michaeldouville.com. The first consultation is always free. Michael’s Book, How to Create a Real Estate Money Machine and Retire with Income, is available on line. Email Michael at michael@michaeldouville.com

Ecclesiastes 7:12 For the protection of wisdom is like the protection of money, and the advantage of knowledge is that wisdom preserves the life of him who has it.

International Jenga… Michael Douville

Posted in #PaulthePoke, Michael Douville, Prophecy, Trend Update with tags , , , , , , on August 8, 2019 by paulthepoke

Ecclesiastes 7:12 For the protection of wisdom is like the protection of money, and the advantage of knowledge is that wisdom preserves the life of him who has it.

Proverbs 22:7 The rich rules over the poor, and the borrower is the slave of the lender.

Michael has been on the slowing global economic decline for the last year. It appears a domino is about to topple. Are you prepared?

Who will be the one that drops the stack? Will International economic turmoil result in US recession?

http:// http://www.michaeldouville.com

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http://www.michaeldouville.com

Do you have all your money in stocks and bonds? What happens if we see a sharp reduction in the markets. Have you prepared your life boat? Michael talks about alternate ways to make income without worrying about the markets.

Who Will Be the Catalyst??? Michael Douville

Posted in #PaulthePoke, Michael Douville with tags , , , , , on April 15, 2019 by paulthepoke

Proverbs 27:12 The prudent sees danger and hides himself, but the simple go on and suffer for it.

Will there be a spark that starts an economic fire? The global economy is slowing down with many countries in recession or on the verge of entering into a recession? Will Turkey be the first domino to tumble? Michael gives his thoughts.

http://www.michaeldouville.com

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The Economy is Transitioning, are you ready? Do you have all your money in stocks and bonds? What happens if we see a sharp reduction in the markets. Have you prepared your life boat? Michael talks about alternate ways to make income without worrying about the markets.

http://www.michaeldouville.com

There are times to be Bold and times to be Cautious. We read the tea leaves daily; we do not want to make a Mistake! As a follower of the Business Cycle and a realization that life does not move in a linear fashion, but rather moves through Cycles. Each different cycle has a unique signature and a unique interaction upon other cycles. We leave the detail research to others, but collate and collect the research into a very usable form. The Presentation always incorporates the latest data. It is this edge that helps discern Us from everyone else allowing the deployment of Capital strategically, timely, and in the path of Growth. Our clients have experienced much better than average returns and have avoided costly mistakes due to our Forecasting.

http://www.michaeldouville.com

Is Turkey the “Catalyst” that Breaks the World?

Posted in #PaulthePoke, Ezekiel 38-39, Trend Update with tags , , , , , , , , on April 1, 2019 by paulthepoke

Isaiah 47:11 But evil shall come upon you, which you will not know how to charm away; disaster shall fall upon you, for which you will not be able to atone; and ruin shall come upon you suddenly, of which you know nothing.

Pay Attention!!!

By Michael Douville – I have forecast the Global Slowdown and now that fact has been recognized by virtually everyone. The Globe is slowing so quickly that the World may be entering a period of vulnerability to a sudden downdraft.

To paraphrase the famous question of “how does this happen?”: slowly, then all of a sudden! The economy has been dragged to the edge of a cliff; something just needs to push it over!

https://michaeldouville.com/

The last decade of repressed interest rates has encouraged a Global Debt Binge!

Italy is in Recession, The Netherlands is also. Germany is teetering avoiding a the statistical recession as the 3rdQuarter GDP was -0.2% but the 4thQuarter managed to rise to 0.0%. Revisions later may change the statistics.

The 1stQuarter of 2019 is looking dismal as Global demand for Autos declined and mighty BMW announced it will not make earnings projections. The stock dropped over 6%.  Lower earnings = lower stock prices!

More bad news for Germany as several Economic Indices are severely declining and the European Industrial powerhouse may be heading into further trouble. As Germany’s trading partners suffer, so suffers Germany as the German Economy is certainly Export driven. 

European Interest Rates have been driven into negative returns forcing European Banks to search for better yields in Sovereign and Corporate Debt. Many Spanish, Italian, and German Banks have still not recovered from the Great Financial Crisis and are “woefully unprepared” for the next financial crisis and the currency union is not resilient enough to emerge unscathed from unexpected economic storms” as reported by Christine Legarde.

Which brings us to Turkey! The last decade of repressed interest rates has encouraged a Global Debt Binge! Not only has business and private borrowers indulged beyond their capacity, but Nations across the World have found that it was very easy and expedient to borrow their way to Prosperity!

Turkey is in trouble! The Turkish Economy has officially entered a Recession. Inflation has been unleashed on the population driving prices of everyday goods beyond reach. The Turkish national currency the Lira has lost tremendous value as the Foreign Exchange rate, although improved from the near 7 Lira to the US Dollar, is still vastly devalued at 5.75 Lira to the US Dollar. To make matters worse, the US Dollar is cycling higher. Portending Turmoil!

Debt denominated in US Dollars is now coming due; Billions and Billions of US Dollars are coming due all while the Lira sinks and the Nation of Turkey is gripped by a Recession. Much of this debt is owed to the Banks of Spain, Italy, and Germany;  Banks that are “ill prepared” for Loss!! Banks that are “Systemically Important”!

Could Corporations in Turkey, struggling with Debt Repayment default on their loans? For that matter, could Turkey default on it’s Sovereign Debt? A Turkish default could lead to losses in Systemically Important Banks; losses now, while Europe struggles, would be felt everywhere!!! 

As I have recommended before, build reserves, pay down debt, cut expenses, review vulnerabilities both personal and Business, and discuss with your advisers as to what is Prudent in your Investment Portfolio. If contagion ignites, financing will be restricted; check with your lenders and review loans for refinance and Lines of Credit. Preserve Capital for the huge Opportunities that will surely present themselves. Review rental agreements and maximize tenant quality rather than maximize revenue. Rental cash flows may be the “Life Boat” to sustain the quality of life jeopardized by a Global Recession.

https://michaeldouville.com/

For more detail linking modern day Turkey to ancient Meshech, Tubal, Gomer, and Beth Togarmah, see the link below.

https://godinanutshell.com/2017/08/08/ezekiel-38-who-are-meshech-tubal-gomer-beth-togarmah/

Global Recession Coming???

Posted in #PaulthePoke, Michael Douville, Trend Update with tags , , , , , on March 26, 2019 by paulthepoke

1 Chronicles 12:32a And of the sons of Issachar, having understanding of the times, to know what Israel should do.

Michael updates what is happening around the world and how it will impact the U.S. Understand the economic times and conditions we are living. Do you have a plan?

Another indicator that the US might be entering into recession. Michael explains the Yields on Debt indicates recession coming to our shores.


http://www.michaeldouville.com

Do you have all your money in stocks and bonds? Are you holding debt? What happens if we see a sharp reduction in the markets. Have you prepared your life boat?


http://www.michaeldouville.com

Standing at the CRAPS Table… Michael Douville

Posted in Michael Douville with tags , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , on August 27, 2018 by paulthepoke

 

1 Timothy 6:10-11 For the love of money is a root of all kinds of evils. It is through this craving that some have wandered away from the faith and pierced themselves with many pangs. But as for you, O man of God, flee these things. Pursue righteousness, godliness, faith, love, steadfastness, gentleness.

Notice what the verse does not say. It does not say, “Money is the root of all evil.”

It is the love of money that is the problem. Coveting money is the problem. It is the longing and desire and focus. The mental attitude is the issue. Making money in the stock market is not evil. There is nothing wrong with investing. But don’t be greedy…

 

https://michaeldouville.com

Timing is EVERYTHING!!! Investing in Stocks in early 2009 was the perfect time to enter the market. The S&P has enjoyed an unbroken string of positive years for the last 9 years; the second longest in History.  An almost no risk Investment resulting in a 280% increase in the Index including dividend reinvestment; Wow!  If one had the prescience to purchase Facebook, Google, Amazon, Apple, and Netflix in the same period, multiples of the S&P have been gained; 500-900%. WOW, WOW!!

Using a little longer time line, historically, the Casino was not built on winners!

Recently cracks in the Markets are starting to show. First Netflix missed the projected number of new subscribers and also lower revenue, and on July 17, 2018 the stock dropped 14% in after hours trading immediately after the announcement. This was followed one week later July 26th by Facebook’s lower than projected Quarterly and again after hours experienced the greatest loss in history of over $119 Billion Dollars in 24 hours. Just days later, another tech giant, Twitter, lost 21% in value on July 28th.  Wealthy one day; not so wealthy the next. Timing is Everything!

A player at the Casino has had an extraordinary run of luck; an extravagant bet of $100 has become $12,800 in 8 wins at the Dice Pass line. The player is allowing the winnings to accumulate in a double or nothing strategy. The” House” is encouraging another bet. After all historically, the player has won each time. What should the player do?  Using a little longer time line, historically, the Casino was not built on winners!

Timing is Everything! Assess your goals, assess your needs; you do to need to be 100% invested. You do not need to be invested 100% of the time. Maybe the advice should be take some of the winnings off the table!!! Maybe you have enough and it is time to reduce RISK!

https://michaeldouville.com

Old, Sick & Very Broke pt 3 of 3… Michael Douville

Posted in Michael Douville with tags , , , , , , , , , , , , , , , , , , , , , , , , , , , , on August 21, 2018 by paulthepoke

Deuteronomy 28:12 The LORD will open for you His good storehouse, the heavens, to give rain to your land in its season and to bless all the work of your hand; and you shall lend to many nations, but you shall not borrow.

Deuteronomy 23:20 You may charge a foreigner interest, but you may not charge your brother interest, that the LORD your God may bless you in all that you undertake in the land that you are entering to take possession of it.

https://michaeldouville.com

Continuing with the theme of rising interest rates, bad things happen to Stocks as well.

Rising interest rates compete with the dividend rate of stocks. Currently, the S&P pays a total of 1.68% for annual dividends, but accepting market risk. Currently in June of 2018, a 1 year Treasury held to maturity pays 2.34% with almost no risk. That rate has risen from 1.22% just exactly 1 year earlier.  Further, Corporations have been the largest buyer of their own company stock. Executives have realized that by borrowing money to buy company stock, they can reduce the outstanding shares and thereby raise the per share return just by maintaining the same revenue. The Executives bonus is tied to increasing share revenue which increases their bonus share offering. Everyone wins; well the executives win!

The Real Estate turmoil should be contained as a correction in an ongoing Bull Market. It could be severe! It could be scary!

However, as rates rise, it is more difficult and more expensive to borrow funds earmarked for Financial Engineering so less and less buybacks will occur at exactly the same time Central banks are reducing purchases. Share prices are directly related to profits; rising rates will deteriorate those profits. As an aside, $4 Trillion in Corporate Bonds are due to be refinanced in the next 3 years; all will be at much higher rates. Higher rates cause costs of Production, Research and Development, and all CAPEX to rise squeezing viability. Just this one HUGE change should cause the hair on the back of your neck to rise; for 10 years, rates were basically ZERO. Now they are NOT!

Retirees hold 70% of their assets in Stocks.  Prices can go down much faster than they go up. In fact, they can plummet!  This fact has been ignored for years until a 3000 point drop in 2 weeks in February 2018. UH-OH! Wake Up! Historic Margin debt may be one cause of these sharp air pocket declines. Leveraging an Equity position is oh so fun as the market expands to new levels.  A reverse of trend will intensify and magnify the losses. Margin calls will force sales which forces prices down which forces sales. A very bad spiral.

Boomers have watched this Movie before; get out of the way! Take Profits! Remove some portion of the portfolio to safety.

Higher rates will impact the Real Estate asset class as well. Fewer families will be able to afford a home of their own as the Affordability Index is directly correlated to payment levels. Fewer buyers qualifying places pressure on prices. Property in overheated markets will be at risk. Luxury homes will become less affordable.  Already our neighbors to the North are experiencing declining sales in Toronto and Alberta. New York City is starting to feel pressure in the luxury condo market as new units come onto the market already crowded with existing units. The Real Estate Cycle is long; 18.5 years.  The last Real Estate Bubble scorched the Earth when it failed, but that was only 9 years ago. Too early for completion of that cycle.

However, the timing would be perfect for a Real Estate correction which typically occurs 7.5 to 9.5 years from the bottom.  Just as a reminder, the bottom was January 2010, give or take a few months.  Simple math places the Real Estate Cycle in the middle of the Jeopardy Period; perfectly matching the expected Epic completion of both the Stock and Bond Markets.

The Real Estate turmoil should be contained as a correction in an ongoing Bull Market. It could be severe! It could be scary!  It will be a Generational buying opportunity for those with vision and courage; also surviving Capital!!! Remember the Affordability Index that should start to close families out of the buying market. They will become TENANTS!!! Long term TENANTS!! Fortunes will be made!!! Not only huge Capital Gains as the Real Estate Cycle moves out of the correction phase, but CASH FLOW! Increasing CASH FLOW.  More revenue each year, growing earnings. If a little leverage is used, the tenants PAY OFF the Mortgage! Remember the Bengen Rule with 4% fixed for life depleting in 30 years? Throw it out!!! Not only will the rental revenue grow and grow providing more and more cash each month, but the loan is being paid off.  A simple 20% down payment becomes a 100% after 30 years; multiplying by 5 times!!! Rentals are easy! Rentals are Profitable! Rentals are run by Property Managers, NOT you!!!

Consult with your Professional about an Exit Strategy for the Stock and Bond Markets. Take Profits and preserve your Wealth! Move your assets into a different Asset Class that has a much longer horizon for Wealth and Income forever!!!

https://michaeldouville.com

Old, Sick & Very Broke pt 2 of 3… Michael Douville

Posted in Michael Douville with tags , , , , , , , , , , , , , , , , , , , , , , , , , , , on August 6, 2018 by paulthepoke

Ecclesiastes 3:1 For everything there is a season, and a time for every matter under heaven:

Ecclesiastes 3:3b a time to break down, and a time to build up…

 

https://michaeldouville.com

This is a simple thought.  When you are in retirement or getting ready for it, you are “not in it for the long haul”! Getting older can sometimes feel like a chore, but it comes with the added benefit of perspective; asset markets have a cycle.  If you are in your 60’s, you have been through 4 or 5 Business Cycles and know they all end badly. This current Cycle will not be any different. Already, the current expansion is the second longest on record. It is also the weakest expansion ever! In this Cycle, the GDP has never exceeded 2.3% and that is with massive fiscal stimulation.  The Great Financial Crisis scared the authorities and Ben Bernanke embarked on a unprecedented program of Global monetary liquidation forcing the economy to postpone the cleansing of insolvent,  poorly managed, or ill timed investments. In June of 2018, Mr Bernanke now has been quoted as alluding to a Wile E. Coyote moment for the US Economy within the next 12 months as the Business Cycle hits an air pocket for FREE FALL!

Knowing what will happen is not the same as when it will happen!  There certainly is a Timing Component to consider. Leave the Stocks and Bond markets too early and the late stage gains are forfeited, too late and maybe all the gains are lost, or worse! Knowing that the Cycle does and will end gives an incredible advantage. One can watch for signs the Business Cycle is about to complete. Invariably, the Federal Reserve raises rates until a slowdown is well established. Not recognizing the Change in Trend the Fed generally hikes at least 2 or 3 times more until a downward spiral has started leading into the Last Stage of the Business Cycle which is ugly and can be very brutal. The Federal Reserve has been hiking rates for two years and now much more aggressively indicating a 25 basis raise every other Fed meeting.

Retirees typically allocate 20-40% of their portfolio to Bonds and Debt. The cash flow generated by fixed investment is predictable and consistent; Debt is a Stealthy Risk. Rising rates will devastate Bonds. Would not the prudent course of action be to reduce to much shorter duration and raise the quality?

This chart illustrates the drastic change in the pace of the rate increases. “Normalization” is still a long way away. 2.38% June 22, 2018, Credit card debt has already risen from 8% to well over 13% and the consumer has accumulated RECORD CREDIT CARD DEBT!

2 year Treasuries climbing FAST!

The Federal Reserve not only directly influences the short term rates in the US, but sets the tone for the rest of the World.  As rates rise in the US, other Central Banks are still suppressing rates notably the European Central Bank maintaining their policy of buying bonds. However, all central banks have stated they are in the process of tapering their Asset Purchases to Zero!!  The effect is rates are now free to rise and the ascension has started. Further,  this will come as no surprise,  the markets are anticipating increasing rates. The process has started!

As of June 22, 2018, Turkey’s 10 Year Bond was priced at 15.7%.  The Turkish Lire is also rapidly losing value; Turkey has defaulted 6 times in the last 100 years.  Argentina, Brazil, Venezuela, the Ukraine are just a few of the Sovereign Nations in trouble with their debt. Look for Defaults; once started a possible Cascade.

Turkey is in REAL trouble!  US rates are driving rates higher throughout the World.  Higher rates affect 40-60% of all Global Debt currently estimated at $217 Trillion. None of us think about the fact that Governments never pay the principal back or even reduce it, Government Debt is simply refinanced. Think about that!! What will tripling the debt service do to already stretched budgets? Social Services will need to be reduced. Not only those that receive the benefit, but also the providers will be curtailed causing a declining ripple effect throughout the World. When the Central Banks stop buying the debt of the Nations, Municipalities, Towns, Villages and Corporations, who will buy Debt priced a 0.1%, or 1%, or 2 %? Probably no one! Rates are heading up and heading up fast and much higher than anyone thought.

Italy has been in the news and not in a good way! Pay Attention!

As the Federal Reserve unwinds the Debt on it’s balance sheet, long term rates will rise as well.

The Federal Reserve has stated it’s intention to raise rates. Central Banks around the World have joined together to state they also will allow rates to rise.  All Debt including Treasury Notes, Bills, and Bonds lose value when rates rise. The longer the maturity, the greater the loss. Unless one believes this trend is going to reverse , holding debt guarantees a loss unless held to maturity. Bond Funds never mature; probably losses have already started. A rapid rise in rates may cause a rush to exit the asset class.  If Sovereign, Municipality, State, or Corporate bonds begin to default as rising rates and a slowing economy could initiate, there could be a Panic to sell Bonds.

Retirees typically allocate 20-40% of their portfolio to Bonds and Debt. The cash flow generated by fixed investment is predictable and consistent; Debt is a Stealthy Risk. Rising rates will devastate Bonds. Would not the prudent course of action be to reduce to much shorter duration and raise the quality? Maybe reduce the exposure to Debt? One does not need to be fully invested at all times.  Cash flow from other asset classes can easily replace fixed income revenue, potentially grow to double or triple the cash flow, and probably prove to be a much, much safer allocation.

The Bond Market has an incredibly long Cycle of 70 years: 35 years with rates trending up and 35 years with rates trending down.  It appears the Bond Cycle bottomed in July of 2016.  As such, the Risk is very evident. As Turmoil begins in the World, Capital will flow to supposedly safer Assets. US Treasuries should enjoy a short window of lower rates as demand for Treasuries depresses rates.This Window may be short-lived, any adjustable rates should be reviewed for refinance into fixed. Further, for disciplined Investors only; Helocs might be created and the funds saved for a Rainy Day.  When turmoil strikes, the Banks quit lending. Cash becomes KING!

Stocks are a little more complicated. The typical Stock Cycle is 7.5 to 9.5 years. This one is the second longest in recent history.

Stocks and Bonds peak and then roll over,  but it is a process not an event.  The US Stock market is usually the last to suffer.  Turmoil around the world “Pushes” Capital to perceived “Safer” Investments.  Martin Armstrong makes a very impressive case for yet higher prices for US Stocks particularly the Dow and S&P as foreign Capital leaves Europe, Asia, and Emerging Markets and looks for safety.  There may be a limit as eventually events overwhelm and the Stock Cycle completes. Since November 2016, the rise in the Stock market has been nothing short of “Explosive”.

Did the Dow peak in February? As of June 2018, the Dow is just about even for the year;  unless you invested in January!  Retail Brokerages opened record new Stock accounts in January of 2018 as the “Retail” crowd rushed in with maximum FOMO ( Fear Of Missing Out). Private and Institutional money that had entered the S&P and DOW in 2009, were very happy to sell to them!! Timing is very important so is the Asset Class! Wealth is gained by entering an asset class early in it’s cycle. Commodities are still bottoming; Rental Real Estate is approaching mid-point with many years until it completes.

https://michaeldouville.com

Old, Sick, and Very Broke pt 1 of 3… Michael Douville

Posted in Michael Douville with tags , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , on July 30, 2018 by paulthepoke

Proverbs 30:24-25 Four things on earth are small, but they are exceedingly wise: the ants are a people not strong, yet they provide their food in the summer…

Michael Douville is a syndicated columnist for the Wall Street Greek.

https://michaeldouville.com/

Most of my friends are broke! At 66 years old, retirement is certainly in the forefront of their thoughts. “How much longer can or should I work?” How many years will I still be viable and able to pursue my interests? What if my spouse gets sick; or I get sick and then we are no longer able to travel; available time taken up with other issues like Health. Time becomes extremely important; the accumulation of Wealth, not so much.

After 10 to 15 years, the Baby Boomers are back to work. The 75 years and OLDER,  represent the largest segment of workers entering the workforce; 63% will go back to work. Completely broke! A travesty!

It is this balance between having “Enough” and not that becomes startlingly clear as one ages and one approaches the end of a career or the end of one’s working life. Ideally, Investments have been made that have blossomed and grown to replace the W-2 income stream and Financial Freedom is attained. This is almost always a process achieved over a number of years; each year growing and adding income.  However, the sad truth is 51% of American Retirees retire Broke. No planning, no savings, no assets! Even worse, the vast majority of my generation, The Baby Boomers, retire the moment they are eligible for Social Security and do not receive their full benefits; taking less, but taking payments earlier.

Making a “Bad” situation worse, most soon-to-be-retired have absolutely no idea what their monthly expenses are and how much it takes to continue their lifestyle.  There are so many variables to factor in monthly housing costs such as Real Estate taxes that are exorbitantly higher in New Jersey, Illinois, New York, and California which drive up the cost to live enormously. Transportation costs in the suburbs or rural areas are much more than public transit in the urban areas. However, seldom are monthly costs less than $3000 per month and typically closer to $4000 per month; the Department of labor Statistics claims $3700 is the magic monthly cost. Unfortunately, the average “Baby Boomer” retiring in 2018 receives a Social Security check of around $1300 if unmarried and $2200 if your spouse is still alive and collecting as well. This is a very far cry from what is needed. Sadly, 41.9 million retired Americans depend exclusively on Social Security.

If a couple has managed to save $300,000, it places them in the 86th percentile of the entire US Population of 55 years and above! That amount of savings and assets gives a certain degree of comfort. Not enough, not even close enough to provide for the rest of your entire life! You will be BROKE in 10-15 years and looking at any menial job that comes your way just to keep the lights on!

There are formulas and guidelines for Monthly withdrawals. The Bengen Rule was developed by William Bengen as an attempt to account for 30 years of monthly withdrawals from the $300,000 Nest Egg. Although again, variables such as any earnings the Nest Egg may generate or worse any losses it sustains, will certainly affect the longevity of the funds. The general consensus is 4% of the funds per year. not including your home, can be safely withdrawn.  The goal is for the Nest Egg to last for 30 years after which the asset is depleted or very nearly so. The suppression of interest rates coupled with the lack of any Financial Correction of assets has changed the outlook to even lower withdrawls. The new conservative approach is to reduce the monthly Distribution from 4% to 3.3%, the Pfau Rule! The results are the same net effect; after 30 years, hopefully you are dead along with your Spouse as all of the Nest Egg is probably gone!

These withdrawal rates absolutely astound people and are met with disbelief. That $300,000 nest egg will generate $12,000 with Bengen and $9,900 with Pfau! Uh-Oh! Keep in mind, according to the Bureau of Labor Statistics, the average Baby Boomer needs $3700 a month. Social Security provides $2200 until a spouse passes then it reduces to the highest individual benefits of the married couple, still a sizable reduction. With a $2200 Social Security  monthly check and as an honorary member of the Elite having accumulated $300,000, which can deliver $1,000 a month, the benefits are still falling short.  There is a shortfall of $500 each and every month; no frills, no motor homes, no Family vacations with the Grand kids, no college funds, and NO ROOM for Health Issues.  Certain Financial trouble for the survivng spouse.  At the Death of a Spouse, the benefits reduce substantially and that $500 shortfall can easily become $1500+.

After 10 to 15 years, the Baby Boomers are back to work. The 75 years and OLDER,  represent the largest segment of workers entering the workforce; 63% will go back to work. Completely broke! A travesty!

What if you are very lucky? What if you live more than 30 years in retirement? More and more Seniors are living to 100 through Medical Advancements. Will you be living with your children or grandchildren,  a niece or your son or daughter, a person down the street, or maybe a Ward of the State? Will you be subject to someone else’s charity when you are 90 years old?  6.2 million Seniors already live below the poverty line.

Take control of your own Destiny! Life is a Gift given by Almighty God.  You have the ability to change your Life! If you are still working, PAY ATTENTION!! It takes about 7 to 10 years and requires discipline and a Strategy. You can develop Wealth for multi generations that will last for your children, grandchildren, and great-grandchildren and will NEVER DEPLETE. Take your husband or wife and explore Europe, walk the Great Wall of China, paint the landscape of the Dead Sea, or learn to cook in France. Enjoy every minute given to you. It is a simple choice, but it is YOUR choice.

https://michaeldouville.com/

Paul the Poke

Habakkuk 1:5 Look among the nations, and see; wonder and be astounded. For I am doing a work in your days that you would not believe if told. -LORD God

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