What's the Longest River in Emerging Markets?

"de-Nile". This is a quote from a recent piece in the Washington Post on banking and the emerging market economies. It provides a good perspective on how financial markets can be manipulated by few, to the detriment of many. While there are precedents to the current economic crisis that we can analyze and learn from, the situation is much like a strain of flu that "mutates" into a stronger more virulent form, and becomes resistant to drugs created to combat it. These are truly uncharted waters, and many outcomes are possible.

For Women of Wealth, what is most important is to be aware of the "macro" economic perspective, and use this to create up a "micro" or tactical approach to financial planning and build toward a positive outcome. The ultimate goal is to provide financial independence by which you can live out your social biography, and create a better world - for your children, your parents, and yourself.

There will continue to be pockets of opportunity amid the current crisis to invest into Emerging Markets. This has traditionally been the areas of highest growth. Once we get past the current set of issues with the world banking system, these markets with continue to grow. What we need to prepare for, is the strong possibility that the US may experience a prolonged period (a decade?) of stagnant growth, much like Japan in the 1980's. With a well conceived social biography and underlying financial plan, you can get past the present and into a bright and prosperous future!

Until next post, continue to believe, achieve, receive. SDG - JBHIV

Signs (& Sighs) of Life

Two events sparked a rally in the equity markets yesterday - an announcement from the US Treasury Department of a plan to invest in "toxic assets" in a public/private venture. This will, they claim, remove these loans from the banks that now hold them and free up credit. Will the plan work? The answer may never be known, and like the TARP funds of last year, it may be too little, too late. The other positive indicator came from the housing sector, which reported an increase in sales of existing homes last month.

All of the moves by the White House, including a media blitz to help sell the proposed budget package, are designed to prop up falling asset prices which are the main reason we are experiencing the worst recessionary period since The Great Depression. Click here for my prior post on this subject, and a link to great commentary by Bill Gross, of PIMCO. As it turns out, PIMCO plans to invest in the proposed public/private fund. This is a good sign, since we as taxpayers need to see this succeed so that we recoup SOME of the Trillions it will ultimately cost us to get out of this mess. Click here for PIMCO's Bill Gross latest take on what is happening in credit markets, and the outlook for the future.

What matters most during this widely cycling market, is that you stay focused on your individual plan of action, and your broader social biography. Let the "gamblers" continue to go after the quick money. Women of Wealth are NOT gamblers. They invest in their future and the future of their children. And that is the best news of all.

Until next post, continue to believe, achieve, receive. SDG-JBHIV

Womens Funding Network

Many of you have acquired wealth or aspire to, by creating value in an enterprise as a business owner, or executive, or elite professional. Some statistics from the US Department of Labor bear mentioning so that you get some perspective on just how far Women have come in their pursuit of Financial Independence:

• Women account for over 48 percent of the wealth in the US
  
• Almost half of all medical students are Women;
• Over 35 percent of all MBA students are Women:
• Nearly 48 percent of all law school students are Women
• The number of women-owned businesses has grown at twice the national average in the last two years:
• The US Senate has 16 Women, and The House has 71 Women:
• Women hold executive-level positions in 49 out of 50 state governments

The recent financial crisis has seen a slowdown in funding for small business, as well as large corporations, however there are resources available for women who are seeking funding and support. One of these that also has a socially responsible mission is the Womens Funding Network. Their upcoming conference at the end of April will bring together leaders from women’s funds and beyond to share innovative strategies for raising and managing resources, articulating impact and achieving lasting social return.

Whether you have been successful at running your own business, or a large corporation, make sure your personal Financial Goals fit into a broader Social Biography. Women are rising fast as leaders in Government and Corporate America. It has been an uphill battle, and there is still work to be done. Support each other in the fight. Change is coming - and now you have the statistics to prove it.

Until next post, continue to believe,achieve, receive. SDG - JBHIV

TGIF 13th - Let's keep it Light and Lucky!

With Tax Season upon us, here is light-hearted look at what our current system will do if we continue to shift the burden onto Women of Wealth:

Girls’ Night Out Economics

Suppose that every Friday night, ten women go out for dinner and the bill for all
ten comes to $100. If they paid their bill the way we pay our taxes,
it would go something like this:

The first four women (the poorest) would pay nothing.
The fifth would pay $1.
The sixth would pay $3.
The seventh would pay $7.
The eighth would pay $12.
The ninth would pay $18.
The tenth woman (the wealthiest) would pay $59.

So the ten women met every Friday and seemed quite happy with the arrangement, until one day, the restaurant owner threw them a curve.

'Since you are all such good customers,' he said,
'I'm going to reduce the cost of your meal by $20.” Dinner for
the ten now cost just $80.

The group still wanted to pay their bill the way we pay our taxes so
the first four women were unaffected. They would still eat for free.
But what about the other six women - the paying customers? How could they
divide the $20 windfall so that everyone would get her 'fair share’?
They realized that $20 divided by six is $3.33.
But if they subtracted that from everybody's share, then the fifth woman
and the sixth woman would each end up being paid to eat her meal. So,
the restaurant owner suggested that it would be fair to reduce each woman's bill
by roughly the same amount and he proceeded to work out the amounts
each should pay.

And so:

The fifth woman, like the first four, now paid nothing (100% savings).
The sixth now paid $2 instead of $3 (33%savings)..
The seventh now pay $5 instead of $7 (28%savings).
The eighth now paid $9 instead of $12 (25% savings).
The ninth now paid $14 instead of $18 (22% savings).
The tenth now paid $49 instead of $59 (16% savings).

Each of the six was better off than before. And the first four
continued to eat for free. But once outside the restaurant, the women
began to compare their savings.

'I only got a dollar out of the $20,'declared the sixth woman. She
pointed to the tenth woman,' but she got $10!'
'Yes, that's right,' exclaimed the fifth woman. 'I only saved a dollar,
too. It's unfair that she got ten times more than I!' 'That's true!!'
shouted the seventh woman. 'Why should she get $10 back when I got only
two? The wealthy get all the breaks!'

'Wait a minute,' yelled the first four women in unison.
'We didn't get anything at all. The system exploits the poor!'

The nine women walked off leaving the tenth behind.
The next Friday night the tenth woman didn't show up at the restaurant, so the nine sat
down and had dinner without her. But when it came time to pay the bill,
they discovered something important. They didn't have enough money
between all of them for even half of the bill!

And that, in a very simple way, is how our tax system works. The people who pay the highest taxes get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just may not show up anymore.

In fact, they might start dining overseas where the atmosphere is somewhat friendlier.

Until next post, continue to believe, achieve, receive. SDG - JBHIV

Forewarned or Foreclosed?: Truth or Consequence?

In yesterday's post I mentioned that despite the news from Citigroup and JPMorgan Chase that the first two months of this year were profitable, there were more signs that the credit crisis is deepening. RealtyTrac, a california based service that monitors real estate values in most major markets, today released their Feb. 09 US Foreclosure Report. It showed that foreclosure activity increased by over 30% over the same period in 08. This surprised many analysts because this occurred despite the many programs in place designed to stem the ever increasing flood of defaults.

This is the beginning of what is the second wave of foreclosures - those by credit-worthy households that have seen one or more high-income wage earners recently lose a job due to an epidemic of layoffs.

How does this trend affect you, a Woman of Wealth? Now is the time to find out. Why? because foreclosures affect EVERYONE, even the wealthy. If you don't think so, click here for a realtytrac report on foreclosures in affluent communities. Many of you own a home or vacation property jointly with a spouse or significant other. If you haven't done so already, you need to sit down together and understand the consequences a loss of income will have on your ability to service existing debt. If you get pushback from the other party, let this be a sign to you that there is probably a deeper problem that needs to be addressed - one of TRUST.

I have heard stories recently of spouses who continue to dress up and leave for work even though they recently lost their job. Their partner had no idea that they were in grave financial danger until the foreclosure notice was received, or the Repo man shows up to take away their luxury auto(s).

This behavior is no different than that of a spouse who receives monthly or quarterly statements from Financial Advisors such as Madoff and Stanford, yet never takes the time to understand what they mean.

TRUST BUT VERIFY! I have said this time and time again. As painful as it may be, you need to confront your partner TODAY, in order to protect your financial future TOMORROW! And trust your intuition - it is usually right!

Until next post, continue to believe, achieve, receive. SDG- JBHIV

It's "Tick" Season

I attended an event hosted by UBS Private Wealth on Monday that featured a discussion with their Chief Lobbyist, John Savercool. He offered some very well-formed thoughts on where this current administration was focused in terms of programs and legislation. One of the things he mentioned was the possible re-institution of the "uptick" rule, and a suspension of the "mark-to-market" accounting rules that have forced so many Banks to write off huge numbers of non-performing loans.

While the Market responded favorably to these potential changes, there are still a huge number of debt-related issues on the table. Yes, consumer debt - primarily credit card debt - actually rose last month after contracting for almost three. But this is not necessarily a good thing. Perhaps you have noticed, as I have, that more and more people are using credit cards to pay for groceries and other consumables. This would stand to reason because once cash reserves or unemployment checks run out, this may be the only resort for the growing unemployed before they have to resort to food stamps.

Women of Wealth tend not to have these immediate concerns and hopefully you have received good advice from your current advisors and have a Plan of Action to support you during these difficult times. Still the debt that has been created through the liberalisation policies of the Federal Reserve for more than a decade will take a long time to work through - perhaps even decades to come.

Those of you that know me are aware of my distrust of the "Fractional Reserve" Banking system and its "pluck from air" creation of money with no backing (gold, silver, etc). Here is another take on the "quantitative easing" and "de-leveraging" of the banking system in a recent post by Jackie Zehner.

Bottom line is that, in my opinion, we should not be lured into a "sucker's rally" that has caused a temporary uptick in capital markets. Even though Citigroup reported profits for the first two months of this year, there are signs that more debt is about to default.

But don't just take my word for it. Pay a visit to your local supermarket and find out for yourself.

Until next post, continue to achieve, believe, receive. SDG - JBHIV

The Financial Blood Bath and You

Once again the equities markets took a nosedive yesterday, as renewed fears gripped investors that the Banking Crisis is far from over. What does this mean to those of you looking for help to sort out the seemingly complicated scenario that is unfolding?

The short answer is: Don't panic. We already have enough of that going on. If you have not done so already you need to focus on getting together a personal plan of action, or executing on the one you have.

The long answer will continue to make itself apparent over the next few critical months. You may be called upon to make tremendous sacrifices. You may need to change your approach to money, and quite possibly your lifestyle. You may need to change your set of advisors if you do not get the straight answers you need - trust is the most important commodity now and it is in short supply.

Until next post, continue to achieve, believe, receive. SDG- JBHIV

Should a sudden drop...

...in cabin pressure occur...an oxygen mask will drop... put your mask on first, then put them on small children. Those of you who travel via aircraft are familiar with this directive, mandated by the FAA as part of the pre-flight checklist that the crew has been trained to deliver. This is but one of several directives (warnings) we are given, all of them designed to prepare us for an in-flight emergency. Most seasoned air travelers, like myself, tend to tune out during this monologue. We hear these words so often that they lose their meaning, or we think the chances of something happening are so remote, we may no longer pay attention.

In the case of the air mask, something struck me recently as I began to think about the current financial crisis and how I have responded. For one, it seemed to me that is selfish to think of placing a mask on me first, then my children. After all, aren't we taught (and innately feel) that we should put the needs of our children first in these situations? The other thing that came to mind was how much I had been "tuning-out" during the last 12 months, despite all the warning signs that things were about to get ugly.

A few observations from this analogy that keep me positively focused during this unsettling period:

• Yes, there is an emergency, but yes, I have been prepared for this eventuality, and have a plan to deal with it.
  
• There is help available, the oxygen mask if you will, which has been given to me to use if needed.
• I must first ensure that I have pure oxygen flowing to me, before I help others with their need. It is essential that I be strong and available to help those unable to help themselves.

Do you have an action plan in place to deal with an ever-deepening crisis? Are you able to take care of your needs, so that you can take care of the needs of your children? If the answer to this question is no, then I ask you to take time TODAY, to listen again to the instructions of others who are willing to help you. Trust your intuition, not the people around you who have gotten us into this mess. They didn't have your best interests or the interests of your children in mind.

Yes, the flight attendant's drone will go on, but this time pay attention.

Until next post, continue to believe, achieve, receive. SDG -JBHIV