Lots of big-name earnings were out today, but were somewhat
overshadowed by a bit of weakness in the European markets.
Speaking of the earnings, luxury goods maker Coach (
) saw shares rise to near all-time highs after
. On the flipside, coal producer Peabody Energy (
) moved back toward 52-week lows following their results. Other
well-known names saw a bit of selling following earnings results
out today include Travelers (
read their report here
), Kimberly-Clark (
), and McDonald's (
Fast Food and Expensive Handbags: The State of the Union
As we get set to hear the President's "State of the Union"
address this evening, I'd like to take a realistic view of things
I'm seeing in the economy, both good and bad. Just looking at
today's news, McDonald's (
) announced it would break ground on over 1,300 new locations in
2012. Meanwhile, Coach (
) continues to see strong demand for their designer goods. So,
eating hamburgers and carrying fancy bags are certainly themes that
have been holding up well in a mostly stagnant economy.
Are these trends positive signs for the overall economic
picture, though? It's difficult to say, but one thing is for sure:
fast food is more popular than ever. The health effects of eating
junk all the time are well-documented, so many people will pay a
price down the line if they indulge too much. Not all fast food is
bad, of course. But given the option, most kids would pick
something they're familiar with and enjoy: pizza, burgers, fries,
etc. It's our job as parents and grandparents (or aunts and uncles
if you don't have kids of your own) to try and stem this tide and
prevent bad habits from taking hold.
Turning to luxury goods, the desire to have the latest handbags,
shoes, clothes, etc. is also a common theme we see everywhere we
turn. The "gotta have it" syndrome runs rampant, but many
economists will label it as a characteristic of a strong economy.
If you ask me, running up credit card bills on expensive items one
can't afford will not be beneficial to the economy in the long
Normal is the New Abnormal
This past holiday season, I traveled up north to New York to my
parents' house, as is the tradition. I hadn't seen many of my
relatives in several months, a period in which I'd lost a
considerable amount of weight. You see, I've been following a
strict diet and conditioning program that has brought my weight
down to the "normal" range for my height.
Many of my relatives were in shock when they first saw me.
Coming from an Italian background, food is obviously a huge deal.
Several of my loved ones actually thought I was wasting away - they
were concerned I was sick or something!
This same attitude applies to a lot of the "hot" material items
that consumers crave these days. Tell someone you don't own an
iPhone, or an Xbox, or a 70″ TV, and they'll likely respond with
confusion. "How can you
not have one of those?" they'll ask. "And why are you so skinny
now?" My answer: "Willpower."
As investors, we need to pay close attention to societal trends,
whether good or bad. Always be cognizant of how you approach the
path of building wealth. The results from dividend investing will
be maximized by those who can display a bit of discipline in other
aspects of their lives. For those who are already retired, it may
simply become a question of budgeting. Remember, people are living
longer than ever nowadays, and will continue to do so. Planning to
spend every last penny before your final day is a big mistake.
So whether it concerns food, the latest gadgets, or investing,
willpower is a key element of success. Focus on building up your
income streams, and you'll be able to afford to spend more later
down the line.
Savings Rate Falls to 2007 Levels
It appears America's brief rendezvous with saving for a rainy
day may be coming to an end. The latest data from the U.S. Commerce
Department shows the amount of money that Americans are saving has
fallen back to its lowest level since December 2007.
Rising food and energy costs are being fingered as the culprits
in Americans' struggles to put precious money aside for their
retirement, along with other large financial outlays such as paying
for college or buying a home.
According to MSNBC, Consulting firm Aon Hewitt is set to release
data showing Almost a third of 401(k) plan participants currently
have a 401(k) loan outstanding. All the recent chatter about money
coming out of equity funds may certainly be a result of individuals
needing to gain access to savings or to address other financial
This data only reinforces my beliefs that you must remain
aggressive when it comes to working as much as your current
opportunities allow. Taking any job for granted these days is a
Look for the trend of multiple generations living under one roof
to continue as financial struggles grip families across the
country. For recent college graduates, the reality of a tough job
market and mounting school debt leaves little options but to return
to the nest for the time being. It used to be that each generation
could break free and plan on their own financially, but more and
more it is becoming a "team" process where those who are stable
financially and professionally are relied upon to carry the load
for longer time than originally anticipated.
Now this doesn't mean your can't enjoy life. It just means that
staying financially organized is more important than ever.
Income, Income, Income
At Dividend.com, we maintain our focus on the best
income-producing investments the markets have to offer during time
of heightened volatility. We want to make sure we have only the
most pullback-resistant names on our
Best Dividend Stocks List
. Also, if we see the market putting in what looks like a decent
bottom, we will be prepared to scale up the list of stocks we like.
Stay tuned and be sure to look for
member alerts along the way. Don't count on the government or your
employer to set you up for a remarkable retirement. Take control,
do your own research, and achieve your goals yourself!
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