The Money Compass Where Your Money Went and How to Get It Back

Between the ongoing recession, the collapse of the housing market, and the crumbling of the middle class, many Americans are left wondering what happened to the American Dream. They&rsquo,re also wondering what happened to their money. For millions of people, just making ends meet is challenging enough. So when it comes to saving and investing, it seems like the deck is stacked against you. The bad news is that you&rsquo,re right. If the economy were a card game, the dealer would hold all the aces. But the good news is that you don&rsquo,t have to play by the house rules. Renowned for his unvarnished insight on finance and investing, money manager Mark Grimaldi has a reputation for telling it like it is. He doesn&rsquo,t sugarcoat the negative and he doesn&rsquo,t have time for the financial industry hype that leads to bad investing decisions. Here&rsquo,s the truth: the economy is in bad shape, but that doesn&rsquo,t mean you can&rsquo,t save responsibly, invest profitably, and retire comfortably. In The Money Compass, Grimaldi teams up with accounting professor G. Stevenson Smith to offer a wealth of smart investing advice for today&rsquo,s investor. This plain–English guide to good investing presents practical strategies and actionable advice for safely navigating today&rsquo,s financial markets. It shows you how to manage credit and debt responsibly, how to use the tax code to your advantage, which kinds of trendy investing advice you should ignore, and where to put your money for solid returns. In addition, the authors explore the hard macroeconomic realities that explain how we got here and where we&rsquo,re going next. They look at the primary causes and consequences of the recession, the housing crash, the slow collapse of government programs, long–term unemployment, and how it all impacts you and your money. Plus, Grimaldi and Stevenson forecast the next big economic shock and show you how to profit from it. , The economic game is rigged to keep you poor and keep Wall Street rich. So it&rsquo,s time to write your own rules. Whether you&rsquo,re white collar, blue collar, or somewhere in between, The Money Compass gives you the commonsense guidance you need to chart a course to a comfortable financial future&mdash,even in the roughest economic waters.

Preface xi Acknowledgments xiii Chapter 1 Introduction: The Invisible Hand of Confiscation 1 The Fourth Branch: K Street Government 2 More Income Tax and More Debt, Too 4 Monetization of the Debt: Say What? 8 The Last Biggie: Repeal of Glass–Steagall and Gamblers Gone Wild 11 Summary 13 References 14 Chapter 2 Greenspan and the Growing Bubble 15 Simple Plans Often Become Complicated 17 Moving On . . . 19 The 36–Day Election 24 My Takeaway Is More than Fries 28 Summary 30 Reference 30 Notes 30 Chapter 3 Drop the &ldquo,U&rdquo, Out of &ldquo,Housing&rdquo, and You Get What America Got 33 2000 to 2006: The Perfect Storm 35 Oops, Almost Made It 38 2007: All Fall Down 40 2008: The Year of Reckoning 44 The Fat Lady Sings: &ldquo,It&rsquo,s Not Over&rdquo, 46 2009 to 2012: The Road to Recovery? 48 Looking Ahead 49 50–Year Mortgages 50 What to Do Next? Let&rsquo,s Buy a House 51 Summary 54 Reference 55 Notes 55 Chapter 4: Credit Cards: Let Me Have It NOW! And They Did 57 The New Law 58 Let&rsquo,s Skip a Payment 59 The Contract 60 How Is That Interest Rate Figured? 62 The Credit Card Tax 67 Tipping a Hat to Debit Cards 68 Getting Back 70 Summary 74 Notes 74 Chapter 5: Who Are Target–Date Retirement Funds Targeting? 77 A Ticking Time Bomb 84 The Dawdling SEC 86 What Can You Do? 87 Chapter 6: Four–Oh–One–Kay Tales 89 The Truth about Your 401(hey)! 90 Meet Mr. Uninformed and Mrs. Navigator 91 Mr. Uninformed and Mrs. Navigator, 10 Years Later 93 A Little More Sizzle 95 One Exception 97 Four Reasons to Invest in After–Tax Accounts 97 Summary 99 Chapter 7: Exchange–Traded Funds 101 Is Mr. Bogle &ldquo,Indexing&rdquo, the Problem? 101 What Is an Index Fund? 102 Why Invest in an Index Fund? 103 Giving Up Downside Protection 104 Giving Up the Ability to Lock In Profits 105 Why Not Buy and Hold? 107 So What&rsquo,s Wrong with ETFs? 107 How Much Should You Pay for an ETF Trade? 110 The Benefits of Professionally Managed ETFs 110 Ranking ETFs the Grimaldi Way 111 Summary 112 Note 114 Chapter 8: Who Took My Money Now? The Collapsing Education System 115 The Feds and State Government 116 The Vendors 117 School Administrators, Relatives, and Cronies 119 The Boosters 121 Teachers, Sex, Unions, Drugs, and More Fraud 123 Parents 128 Students 129 So What Are You and Yours Losing? 130 Are There Choices? 131 Summary 134 Notes 135 Chapter 9: Staying Poor in America 137 Rich or Poor? 138 What Else? Business Models Have Changed Our Way of Earning a Living 141 Other Factors Making Americans Poor 143 Spend It if You Got It or Pretend to Be Rich Until You Are Poor 144 Governmental Solutions 146 Private Solutions 147 Summary 150 Notes 151 Chapter 10: The Federal Debt Bomb: Hold Your Breath (at least try) 153 Government Choices and Me 156 What Am I Going to Lose in These Policy Choices? 164 So How Do I Keep from Losing My Shirt&mdash,or at Least Survive an Inflationary Environment? 169 Summary 171 Notes 171 Chapter 11: Navigating the 2014 Recession 173 Beginnings 174 Behind the Accolades&mdash,Accurate Forecasting 177 The 2014 Recession 180 Recession Rules to Live By 181 Navigate Carefully 184 Appendix The Grimaldi Forecasts 186 January 2008 Navigator Newsletters 186 February 2008 Navigator Newsletters 189 March 2008 Navigator Newsletters 189 June 2008 Navigator Newsletters 191 November 2008 Navigator Newsletters 192 May 2009 Navigator Newsletters 194 Chapter 12: Changing Job Patterns and You 197 How Could This Happen? 200 Did You Leave the Middle Class on Purpose? 202 The Job Recovery from the Great Recession 203 Societal and Economic Effects 204 A Possible Solution? 207 Summary 210 Notes 210 Chapter 13: Gratuity Government: Should I Take the Free Butter? 213 Taker Trends: Get Wise and Do Less for Yourself 215 Entrance to the Land of the Takers 216 Transfer Payments and a Hypothetical Monthly Budget 223 Summary 225 Notes 226 About the Authors 227 Index 229