Daily Archives: February 18, 2015

Heads Up!

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What would have happened, if you would have passed away yesterday, to the “digital assets” you own? Digital assets do not have a uniformly accepted definition, but generally include digitally stored content, online accounts, travel miles, credits on eBay or Paypal or Amazon, online storage accounts like Drop Box, or iCloud, or music held in iTunes or Pandora. As our lives become ever more digital, this question will continue to grow in its importance. Individual states have been slow to pass legislation dealing with the ownership issue. Both Pennsylvania and New Jersey have considered legislation but have yet to pass it into law.

Some social networks have acted – Facebook for one. The social network rolled out an update Thursday that lets you assign a Facebook friend as a “legacy contact” to your account, essentially granting special access to the account in the case of your death. You can also choose to have your account deleted entirely. This legacy contact will not be able to post on your behalf or see your private messages. They will, however, be able to download your Facebook archive, which includes all of your photos, and post a note that will remain pinned to the top of your profile page.

If you want your profile deleted, Facebook will honor that request and remove your photos, Timeline, and past likes and comments (although some stuff like “log records” will remain). Facebook already memorialized profiles at the request of the deceased user’s family, and has done so for a number of years, said Vanessa Callison-Burch, a product manager at the company. That, of course, didn’t give users much control over what was done with their accounts, and the new update provides that option. If you choose someone as your legacy contact, he or she will not be alerted to your decision until you’ve passed away, added Callison-Burch. The update is available only for U.S. users, but will expand internationally “soon,” she said.

Source: (In Part from: The Wall Street Journal and http://www.digitaldeath.com )

Please contact me if you have questions or concerns about how this affects you.

The Economy

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Economic reports were sparse last week. The negative economic news exceeded the positive. Here is a recap:

Positives:

  1. Import prices declined 8% year over year.

Negatives:

  1. Initial jobless claims came in at 304k vs expectations of 287k.
  2. Retail sales ex-autos and gasoline gained just 0.2% vs the expected 0.4%.
  3. Mortgage applications fell for the fourth straight week.
  4. University of Michigan Consumer Confidence fell to 93.6 from 98.1.

The “Heat Map”

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Most of the time the U.S. stock market looks to 3 factors (call them the “pillars” that support the stock market) to support its upward trend – let’s grade each of the pillars.

CONSUMER SPENDING: This grade is an A (very favorable) due to the favorable effect of lower gasoline and heating oil prices.

THE FED AND ITS POLICIES: We continue to grade this factor an A+ (extremely favorable) because the FED cannot do much more than it is doing to support the stock market and asset prices.

BUSINESS PROFITABILITY: This factor’s grade is a B- (slightly above average).

OTHER CONCERNS: The “Heat Map” is indicating the U.S. stock market is in good shape ASSUMING no international crisis. We have added the heightened risk of turmoil in Europe from the recent Greek election. The Greeks, with help from Russia, may take a hard line against paying back the huge bail-out loans with which Greece is saddled. On a scale of 1 to 10 with 10 being the highest level of crisis, we rate these collectively as a 3. These risks deserve our ongoing attention.

NOTE: there is no change from the prior week in the above ratings.

The Numbers

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Last week, US Stocks and Foreign Stocks increased but Bonds declined. During the last 12 months, STOCKS outperformed BONDS.

Returns through 2-13-2015

1-week

Y-T-D

1-Year

3-Years

5-Years

10-Years

Bonds- BarCap Aggregate Index

-.2

.8

 5.3

 2.7

 4.4

4.7

US Stocks-Standard & Poor’s 500

2.1

2.1

17.0

18.3

16.7

7.9

Foreign Stocks- MS EAFE Developed Countries

1.6

3.7

-.1

 9.2

7.7

4.8

Source: Morningstar Workstation. Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. Three, five and ten year returns are annualized excluding dividends.

“Your Financial Choices”

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“Your Financial Choices” The show airs on WDIY Wednesday evenings, from 6-7 p.m. The show is hosted by Valley National’s Laurie Siebert CPA, CFP®, AEP®. This week Laurie will discuss: “How your income is taxed for Federal, State & Local”

Laurie will take your calls on these topics and other inquiries this week. This show will be broadcast at the regular time. Questions may be submitted early through www.yourfinancialchoices.com by clicking Contact Laurie. WDIY is broadcast on FM 88.1 for reception in most of the Lehigh Valley; and, it is broadcast on FM 93.9 in the Easton and Phillipsburg area; and, it is broadcast on FM 93.7 in the Fogelsville and Macungie area – or listen to it online from anywhere on the internet.  For more information, including how to listen to the show online, check the show’s website www.yourfinancialchoices.com and visit www.wdiy.org.

The Markets This Week

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The broad market soared to all-time highs last week, surfing 2% higher on a wave of reassuring—if short term—developments. Small-caps made a comeback, outperforming megacaps, which some take as supportive of a more sustained resurgence after the year’s so-far desultory move.

“A confluence of factors both geopolitical and fundamental helped global markets rise, not just the U.S.,” says Joseph Amato, chief investment officer at Neuberger Berman. With a Ukrainian cease-fire agreed to on Thursday, and Greece and its creditors seen to be talking rather than bickering, “at least for now, it seems to have calmed fears,” Amato says. Whether the actions last week presage long-term solutions remain to be seen.Investors were also heartened by rising oil prices, more promising German economic data, and a “reasonable” showing from fourth-quarter earnings reports, he adds.

Crude prices rose for the third consecutive week. While there is an oversupply of the black gold, the sustained oil increase is easing fears about oil demand and global growth.

Though euro-zone economic data on Friday showed some big countries are still stagnating, Germany—the Continent’s engine—posted 0.7% fourth-quarter gross-domestic-product growth, significantly better than the previous quarter.

Last week, the Dow Jones Industrial Average picked up 195 points, or 1.1%, to 18,019.35, while the Standard & Poor’s 500 index jumped 42 to 2096.99, a record close. The Nasdaq Composite tacked on 149, or 3.2%, to 4893.84, and the Russell 2000 small-caps index gained 1.5% to 1223.13.

After underperforming for a year, small-cap stocks played catch-up last week, says Rick Fier, a trader at Conifer Securities. Given that the group didn’t outperform as the greenback strengthened, contrary to expectation, the latest rise is seen as confirming the bull, he says. Fier expects the S&P to surpass 2100 soon and then grind higher.

(Source: Barrons Online)