Nick Bertell

Nick Bertell

Interest rates raised for second time in 10 years

Well, they did it. The Federal Reserve raised interest rates for the second time in the past ten years at its Dec. 14 meeting. Now, the Fed wanted to raise rates in the worst way to give them ammunition to fight the inevitable next recession, but there are significant ramifications to their actions.

Back in 2008, the Fed cut rates from 5.25 percent to zero in order to stave off a worldwide depression caused by the housing bubble, and they only 0.50 percent to 0.75 percent today. Of course, the Fed caused the housing bubble in the first place by cutting rates too far and keeping them there for too long after the dot com bubble and 9/11. They eventually saw the error of their ways and raised rates back, but it was too late. When money is too cheap and too easy to come by, it creates market dislocations known as which are badly allocated business investments due to those artificially low interest rates.

People who couldn afford to buy a home were given access to the easy money. The mortgages were then sold to investment banks like Goldman Sachs and Morgan Stanley who packaged them in investment products and sold them to investors who needed yield that they couldn get safely due to the Fed rate reductions. Well, these investments weren safe either and when the inevitable defaults started, the world financial system teetered on collapse. The Fed knows all too well what is going to happen if they leave rates where they are. It just a matter of time until another malinvestment bubble comes along like we seeing in both student and subprime auto loans.

Historically, when the Fed tightens, it because the economy is overheated and inflation is too strong, but that not the case today. The government can say the economy is growing and unemployment is getting better, but it not really true. They economy is better than in 2008, but nowhere near where it should be considering the Fed has thrown $3.7 trillion at it. And the number of people working in what I call head of household jobs, ones that can support a family, is almost exactly the same as 2008. The actual labor force participation rate is 62.8 percent, the lowest in history.

A major reason not to have increased rates is the strength of the dollar. The dollar is already the strongest currency in the world, and raising our interest rates will attract money from around the world to be invested in US bonds and money markets. These foreign investors have to convert their currencies to dollars to make those investments and that will strengthen the dollar further.

While a strong dollar sounds like a good thing, it comes at a time when every other major economy in the world is weakening their currencies. And they do it so they can produce goods cheaper and then sell them for less than their neighbors. And while that good for us as consumers, it not for our domestic corporations. They have to produce their products in dollars, but when they export them, they get paid in the now discounted foreign currencies. And then, when they bring the money home they lose on the currency exchange back to dollars, and that ultimately leads to a reduction in both profits and jobs. is the world third largest exporter, as a percentage of GDP we low; only 13 percent of GDP comes from exports. But 45 percent of S 500 company sales come from those exports, and that in turn drives the economy and the stock market. Imported goods becoming cheaper leads to two problems. One, it takes sales away from our company products, and two, cheaper goods cause deflation. You in no hurry to buy something that will probably be cheaper in a few months. The Fed has two jobs, maximize employment and stabilize prices. By stable prices, they mean a 2 percent inflation rate and deflation makes both of their jobs impossible.

The Fed is betting the advent of President elect Trump pro market economic proposals are likely to cause inflation despite the strong dollar, so the Fed thinks it gives them room to raise rates now and three more times in 2017. But higher rates can lead to negative outcomes. Remember, at the 2015 December Fed meeting, they raised for the first time in nine years and the stock markets sold off by 11 percent in January and February. That can happen again, so be careful and protect your portfolio. It might be a good time to raise a little cash.

Until the next time, we watch your money.

Nick Bertell is a Financial Advisor. All information herein contained has been prepared solely for informational purposes, and is not an offer to buy or sell any security or instrument or to participate in a trading strategy. Certain statements including but not limited to statement that are predictions or indicate future events, trends, plans or objectives. Undue reliance should cheap jerseys not be placed on such statement because, by their nature, they are subject to known and unknown risks and uncertainties.

de l’usine Petits lingots Saguenay

de l’usine Petits lingots Saguenay

Le prsident du Syndicat national des employs de l’aluminium d’Arvida (SNEAA), Alain Gagnon, affirme que le salaire plus bas de 20 % des employs par rapport ceux de l’aluminerie s’explique par le fait que les deux productions ne sont pas comparables. La production de lingots pour l’industrie automobile se situe dans le domaine de la deuxime transformation, o les salaires sont en gnral beaucoup plus bas.

On est loin du 20 $ l’heure. 33 $, ce sont des gens qui vont suivre le march et au dessus, parce qu’il n’y a pas grand monde qui gagne a.

Le prsident du SNEAA ne craint pas que les conditions des employs de l’usine de petits lingots s’tendent aux autres employs de Rio Tinto. Alain Gagnon rappelle qu’elles prvalent depuis 2008 l’usine de traitement de la brasque, sans effet sur les autres travailleurs.

Le prsident du syndicat y voit mme du positif. On amne une nouvelle niche dans laquelle on dmontre que la deuxime et troisime transformation, ce n’est pas cheap qu’il faut la faire. Il faut faire a des salaires dcents pour retenir notre main d’uvre dans notre rgion et avoir du monde heureux l’ouvrage, dit il. Donc, c’est l’inverse que a va faire, c’est qu’en faisant a, a va tirer la transformation vers le haut et non pas l’inverse.

Rio Tinto rappelle que l’usine est toujours en rodage. Pour sa part, Alain Gagnon prcise cheap jerseys que les installations ont une capacit de 100 000 tonnes et pourraient donner de l’emploi plus d’une quarantaine de personnes.

de Brigitte Deslauriers

de Brigitte Deslauriers

Il tait arriv plus tt. Il voulait prendre son temps, laisser resurgir les souvenirs pour qu’ils puissent reprendre leur place, se dposer doucement. Il ne voulait pas se laisser envahir par les motions. Il devait rester calme, pour ne pas qu’elle le croie fou.

L’endroit, malgr les annes passes, n’avait pas vraiment chang. Les tables et les chaises dpareilles, les fleurs sches encadres, les oiseaux en origami de toutes les couleurs qui pendaient du plafond, l’armoire en bois, au fond gauche, l’odeur enveloppante du caf. Ils aimaient s’asseoir la petite table prs des grandes fentres et des plantes en pots.

Il tait donc l, attendre en regardant autour de lui, tentant de se prparer l’impact. videmment, toute cette mise en scne avait t totalement vaine. cheap jerseys Lorsqu’elle entra, tout se passa exactement comme le scnario cheap qu’il avait vainement tent d’viter. La clochette de la porte d’entre qui carillonne, le haut du corps qui s’introduit, la lumire dans les cheveux, le regard qui cherche, le sourire, mon dieu, le sourire, le coup dans l’estomac. Pathtique.

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dd’s Discounts seeks bargain lovers

dd’s Discounts seeks bargain lovers

RELATED Business news

DAILY BREEZE BLOG South Bay Biz Waves Eara Pollard pushed a shopping cart with boys jeans hanging on one side as the Carson resident took in the city’s newest department store Friday. “I like this store. I can get the jeans for my boys with a really cheap price,” said Pollard, 39, who works as a dental assistant during the day and an overnight stock clerk at Target when her five sons are asleep. On Thursday, Ross Stores Inc. opened its dd’s Discounts store at 481 cheap jerseys E. Albertoni St. The store, which sells apparel, accessories and linens, will hold its grand opening today. The Pleasanton based retailer also has its Ross Stores discount brand, which is more upscale than dd’s Discounts. The company selected Carson for its 53rd dd’s Discounts because of the city’s demographics, spokeswoman Bobbi Chaville said. “The area we chose is a very densely populated area,” Chaville said. “It has a good ethnic mix, which appeals to the dd’s customer. And it’s good exposure. It’s right off of the 91 Freeway.” The store is designed to appeal to customers seeking even deeper discounts than at Ross, Chaville said. “(It’s) those customers who find bargains attractive, and we feel that’s important, especially in this economy,” Chaville said. Each dd’s Discounts employs an average of 30 to 40 people. The Carson site has 22,000 square feet of space. In the afternoon Friday, several dozen curious shoppers walked through the Carson store’s aisles perusing items and examining price tags. Men waving store signs were posted at nearby street corners. The store opening comes amid a major retail slump that has severely cut into sales tax revenues for state and local governments. The store is part of a new shopping center called University Square that will include seafood restaurant El Tescador as well as other eateries. “Having a retail tenant there that seems to have a market and will be useful locally seems to be a good thing,” Cliff Graves, Carson’s economic development general manager, said of dd’s Discounts. The city of Carson helped dd’s Discounts and the shopping center’s other tenants recruit workers through a January job fair, Graves said. “We have a service for employers where we will advertise, help recruit and prescreen job applicants to make it a little easier for employers,” Graves said. Ross Stores will open three other dd’s Discounts this year, including an Inglewood site in July, Chaville said. “Why Inglewood? Same reason. Very good density, good ethnic mix,” Chaville said.

DDA hungry for downtown grocery

DDA hungry for downtown grocery

Recently, DDA members reached out to the food cooperative in Laramie. They wondered if the co op would consider creating a satellite operation in Cheyenne.

Leaders there said they aren’t interested right now.

Where those stores are located depends on a strong customer base, available space and the ease of cheap jerseys getting in and out of the store, said Paul Bernish. He is a supermarket consultant from Cincinnati.

But there is room for a smaller grocery downtown, said Dick O’Gara, vice president of the DDA said.

O’Gara served on the board when it hired that consultant back in 2010. He said the expert noted a smaller store might work in the area.

The store should be between 2,000 4,000 square feet, O’Gara said. That’s far smaller than typical supermarkets, which cover about 40,000 square feet, he added.

“I don’t think it could be just a stand alone store,” O’Gara said.

Instead, it would need to sell something more than groceries, perhaps a deli. But a deli would face stiff competition from existing downtown restaurants, he said.

It would be a plus for the store to stock prepared food like deli choices for when people who don’t want to cook can pick up some ready made food after work, he said.

But no one is actively interested in opening up a grocery downtown, O’Gara added.

“It’s going to take a creative entrepreneur and developer to make it go,” he said. “Those are not cheap businesses to open up.”

Cheyenne lost its downtown grocery when the Safeway on Pioneer Avenue closed in February 2010. That store was half the size of other major supermarkets in town, O’Gara said.

“Even being half the size, it couldn’t make any money,” he said. “When you look at the profit margins on grocery stores, they are very low, 2 to 3 percent. You have got to turn a huge amount of volume to make money.”

A small store would have to turn a lot of volume and have lots of in and out customers.

“And that is what makes it risky,” he said.

Bernish said there is a growing interest, in larger cities at least, in getting grocery stores back downtown.

Many people have retired and moved back to cities’ central cores. A lot of young professionals also want to move to city centers, he added.

“And they want a grocery store,” Bernish said.

In Cincinnati, for example, the downtown Kroger supermarket went away decades ago. The company now plans to bring one back.

But Cincinnati has a strong customer base of between 5,000 10,000 people who live downtown, he added.

Any downtown store has to be one where people can reach it by walking or driving, Bernish said. Without that, “it won’t work,” he added.

Grocery store operators must realize that downtown stores can’t be like big suburban stores, he said. They have to appeal to “nontraditional shoppers,” those who stop by after work and on weekends.

They see a grocery store as a gathering place, he added.

Grocery stores are built in areas when other things like condos and apartments exist, he said.

“You can’t expect a grocery store to be the first into a downtown area,” Bernish said.

The idea of a food cooperative may be an option for downtown, even though DDA couldn’t make the Laramie venture work.

The Fort Collins (Colorado) Food Co op has operated in the older part its downtown for 40 years. It is owned by its 1,500 members.