Costs for $100,000 loan equals approx. $500.

Costs for $200,000 loan equals approx. $1000.

If you or someone you know is planning to get a new home mortgage, you may want to consider acting on the opportunity before the additional expenses are applied.

If you are in the process of getting a new loan and your payment is currently locked in you can avoid the increase if your loan is closed before mid-February.

If you have already closed on a new low interest rate in the past 24 mos and have no need for additional financing right now you will not need to worry about this fee. 

Call my office if you have questions and schedule time to discuss the best options.

Because our behavior is tied—more than anything else—to pleasure and pain.

Imagine a campfire. It brings warmth and pleasure as you get closer to it. But get too close and it will bring pain. As we seek the pleasure of an inviting campfire, our instincts protect us from the pain of getting too close.

Seeking pleasure and avoiding pain are hardwired to our behavior. This serves us well with fire, but not with investing our savings. Investors experience real pain when they see the value of their savings drop, and with the pain comes a strong desire—an instinct!—to get out.

Equally dangerous is the pleasure of seeing the growth in the market. Once they’ve gotten out, investors wait on the sidelines until things swing the other way. Then instinct tells them to jump back in. Sell low and buy high. As investors we know that’s exactly the opposite of what we should do, but the pain/pleasure instincts are strong.

They act against us.

But there’s an answer for our instincts…

Free Market Funds are built to combat the bad behaviors that destroy investor returns.

Coaching helps you identify the bad inclinations before you act on them.

Rebalancing is a disciplined approach to always selling high and buying low.

So enjoy the warmth of disciplined investing. Don’t get burned by bad behavior.

You can see from the chart that the mortgage bonds have stalled out at the same place they did last year. This is significant. We don’t know when the interest rates will jump up but it does not appear that they will go significantly lower from where they are today. If you know of anyone that is considering financing their home in the next few months they would do well to get things started soon to get the best terms.

Most fixed rates are between 3.5% and 4.5% depending on the length of the term (15yr to 30yrs) and the credit of the borrower. Let me know if you have questions about any of this.

What I love about this is the powerful lesson that the twins learn from their father about honesty. Their father is showing them that honesty is more important than $50,000. How often do you and I have the opportunity to show our kids moral lesson with such a quantifiable dollar value attached? The father of those twins gave his boys something worth far more than $50,000 that night. I love it!!

1. Markets are random. They go up as randomly as they go down. Unpredictable over the long term.
2. Volatility = Risk. The more volatile the markets, the more risk associated with investing.
3. 3. The market rewards higher risk with higher returns over time. More long term risk results in higher long term rewards.
4. 4. The current market volatility will provide better returns for my long term savings! I will be rewarded by staying disciplined!

.

This video shows how the current volatility is a repeat of the past!  History teaches us to be disciplined and optimistic about the Free Martket!

This is only true for investors that believe in the Free Markets and invest accordingly! This is not true for actively traded mutual funds! You can benefit from the current events but not by chasing after hot stocks or self proclaimed market experts! There are three simple things that we do for our clients to get the maximum benefit from all that the free market gives to disciplined investors over time.

OWN STOCKS – DIVERSIFY – REBALANCE

Your Peace of Mind can go up as the market goes down! If you don’t enjoy Peace of Mind in volatile markets then make time to attend one of our educational events or call my office to schedule a short phone consult!

With all the attention on the DEBT CEILING debate raging in Washington DC there are plenty of self-proclaimed “experts” that offer conflicting advice about WHAT WILL HAPPEN TO YOU in this whole mess. There are 16 days until we “hit the wall” on August 2nd. I AM NO EXPERT regarding the national debt and you are under no  obligation to agree with me. Here is simply a list of the things I am doing (or not doing) over the next 16 days. Let me know how they compare to your own.

1. I’m not going to panic. The political process manufactures URGENCY and FEAR to force an agenda! The financial media does the same thing. I am not going to fall into their trap. I am proactive not reactive!

2. FREE MARKETS are much better at sorting out complex issues than politicians. As the debt deadline approaches there are millions of investors “voting” on this issue by how they invest their money. The financial markets (stocks and bonds) are not buying the garbage that is being fed to us by our legislators or the media and neither will I.

3. I own Equities (Stocks), Diversify and Rebalance. This is my long term investment strategy before and after August 2. I manage risk with diversification into a dozen asset classes with over 12,000 different holdings in over 40 countries.

4. If the investment markets become more volatile I will expect to get higher investment returns over time. Based on a long history, I expect to be rewarded for higher volatility. I will be rewarded for remaining disciplined while others panic.

I see this debate as holding opportunity for the disciplined long term investor. If you have anxiety about the current debt ceiling debate please contact me.

You can achieve Peace of Mind in your investments today.

The Debate:

Setting aside all the politics and character assassinations over the current debt ceiling debate, at the core of the debate is this question, “what is the best way to spur the slow economy back to robust health?” John Maynard Keynes, after World War 1, provided an economic model that emphasizes government deficit spending as the quickest way to jump start economies. This is considered a credible and compassionate approach to correcting problems created by a bad economy. It has always been controversial but Keynesian economic principles are deeply entrenched in Economics Departments of most Colleges and Universities. The model emphasizes spending. Spending gets people back to work quickly and their individual production creates more spending and lifts the struggling economy out of recession. If the recession persists, Keynesians would insist that we need to spend even more money.

This idea clashes with Free Market thinking in a number of areas. First, who gets to determine when government intervenes? Keynesians want to anticipate recessions and spend to avoid them. There is a constant pressure for government to spend. It never ends. Second, where does the spending money come from? Keynesians are not opposed to deficit spending but they admit that paying back the money has to come from those that benefitted from the economic rescue. In the end, government takes back what the recovering economy produced. Third, who decides where the money is spent? Keynesians say that ultimately that does not matter even if there is waste and fraud, just get the money out there. Free Market believers know that this allows government agencies to create “bubbles” in the market by artificially propping up their favorite market sectors. Bubbles burst and then Keynesians would justify more spending to clean up a different mess. This creates a never ending spending cycle that involves more and more government participation.

Conversely, Free Markets reward productivity and utility more than simply spending. The Free Market is not perfect but it is the best mechanism to coordinate millions of self interested and productive individuals. It can factor in an infinite number of variables in determining how an economy will best function and use resources over the long term. The Free Market appears messy. It can be harsh and unforgiving. However it is also able to push the greatest number of people to reach their greatest potential. This has already been proven for over 250yrs in the great American Free Market experience we are all benefitting from every day.

Sincere, intelligent, compassionate individuals believe that we can spend our way out of this recession using Keynesian economic models. We need to respectfully but firmly insist that they are wrong.

Your Invested Savings:

The good news is that you can invest your savings using the Free Market principles and largely avoid the harmful effects of this debate. In fact, there are rewards to the informed and disciplined investor during these uncertain economic times.

First, you need to understand risk in your invested savings and determine the amount of risk you are able to tolerate. Second, you need to diversify your equities(stocks) properly to lower risk and maximize returns. Third, rebalance regularly to maintain your risk/return target portfolio. Repeat.

The Free Markets reward volatility (risk) with higher returns over time. The current spending debate creates volatility in the markets. The Free Markets will demand higher returns over the long term for the increased volatility. There is no reason to panic. This debate has existed for as long as the US Stock market has existed. In the end Free Market always trumps Keynesian economic models.

My Question for you is, “Are you using Free Market investing strategies or are you a Keynesian investor?