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Will the Crisis in Syria Shock the Markets?

By Robert Pagliarini on September 5, 2013

U.S. military action in Syria appears imminent. Assuming it happens, what happens to the financial markets? Investor reaction on August 27 (the day U.S. intervention was mentioned as a possibility) was not exactly surprising. Gold entered a bull market again, oil prices reached a six-month peak (surpassing $109 a barrel), the Dow fell 170 points…

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Could Pension Reform Disturb Investment Funds?

By Robert Pagliarini on September 4, 2013

On Capitol Hill and elsewhere, voices are calling for a major shift in public pension plan management – a shift toward privatization. Underfunding of public pensions is all too common. The bankruptcies of Detroit, Stockton and San Bernardino have certainly cast light on the pension funding gaps in those cities, but the problem is widespread:…

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Investing in BDCs: Greater Yield, Greater Risk

By Robert Pagliarini on August 27, 2013

An obscure investment option draws interest. In searching for greater yield, investors look down many avenues. One new (or at least relatively untraveled) avenue has garnered some buzz lately – investment in business development companies, or BDCs. A BDC essentially functions as a subprime lender for a start-up or a financially struggling business. Big banks…

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The Implications of Rising Mortgage Rates

By Robert Pagliarini on August 20, 2013

Between early May and mid-July, the average interest rate on the 30-year fixed-rate mortgage rose about 1%. Rates on 30-year FRMs have basically held steady since hitting a peak of 4.51% in Freddie Mac’s July 11 Primary Mortgage Market Survey – in the August 15 edition, they averaged 4.40% – but there could be dramatic…

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Understanding the Advantages of a 1031 Exchange

By Robert Pagliarini on August 8, 2013

Real estate investors who want to defer capital gains have a neat option: they can take advantage of Internal Revenue Code Section 1031 to exchange out of one investment or business property for a “like-kind” property or equal or greater value. Usually, no gain or loss is recognized when you do a 1031 exchange. The…

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Keep Calm & Carry On – It May Be Good For Your Retirement Portfolio

By Robert Pagliarini on July 2, 2013

Why do so many retirement savers underperform the market? From 1993-2012, the S&P 500 achieved a (compound) annual return of 8.2%. Across the same period, the average investor in U.S. stock funds got only a 4.3% return. What accounts for the difference? One big factor is impatience. It is expressed in emotional investment decisions. Too…

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The Fed Shakes Up The Markets

By Robert Pagliarini on July 1, 2013

The end is in sight for QE3. On June 19, the Federal Reserve let investors know that “easing without end” will eventually end, perhaps as early as mid-2014. Wall Street had anticipated such a signal, but investors still reacted emotionally to the news, with the Dow Jones Industrial Average ceding all of its May and…

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Where Did Inflation Go? With All This Bond Buying, Shouldn’t It Be Rising?

By Robert Pagliarini on June 27, 2013

Consumer inflation just hit a 50-year low. So indicates the Federal Reserve’s preferred inflation gauge – the Personal Consumption Expenditures (PCE) price index maintained by the Bureau of Economic Analysis. Besides tracking consumer inflation, the PCE price index measures household purchases, a major factor in GDP growth. The core PCE index does the same thing…

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Understanding the Markets: What the Acronyms Signify & What Affects Investors

By Robert Pagliarini on June 11, 2013

Dow. NASDAQ. S&P 500. Fear index. NYSE. Commodity prices. Earnings. Economic indicators. These are the gauges and signposts of investing, but if you stopped most people on the street, you’ll find they have only a hazy understanding of what these terms signify or reference. If you’ve ever been left dizzy by the jargon of the…

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Take Advantage of Rising Interest Rates With Step-Up CDs

By Robert Pagliarini on June 10, 2013

When interest rates climb, will these be the CDs to own? Step-up certificates of deposit (also called rising-rate CDs) are fixed-income investments with a bit of wiggle room. When you have a CD with a step-up provision, you have a chance to exchange the initial yield for a better one as interest rates rise. Given…

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