Wall Street boosted by financial, energy stocks

Traders work on the floor of the New York Stock Exchange (NYSE) as the market closes in New York, U.S., October 3, 2016. REUTERS/Lucas Jackson(Reuters) – Wall Street rose for the first time in three days on Wednesday, powered by gains in financial and energy shares.

Activity in the U.S. services sector saw a big rebound in September, after having slowed to more than a six-year low in the previous month, a report from the Institute of Supply Management showed.

The data raised the prospects of a U.S. interest rate hike in the near term and comes before a carefully watched non-farm payrolls report on Friday.

Oil prices touched their highest levels since June following a bigger-than-expected draw in U.S. crude inventories.

“The markets are taking the economic news positively, but it is a double-edged sword in our opinion because a better economy means the Fed is going to finally start moving on rates,” said Brad Lamensdorf, co-manager at Ranger Alternative Management in Connecticut.

Traders priced in a near 65 percent chance of a rate hike in December after the ISM report, according to the CME Group’s FedWatch tool.

The odds had slightly fallen earlier in the day after data showed that fewer-than-expected jobs were added in the private sector last month.

A growing number of Fed officials have argued for a rate hike before the year ends as conditions in the labor market improve and inflation inches toward the central bank’s 2 percent target.

The S&P financial sector rose 1.46 percent to more than a three-week high.

Wells Fargo and Bank of America rose 2.5 percent and were the top influences on the benchmark S&P 500 index.

Deutsche Bank’s U.S.-listed stock was up 1 percent, while its Frankfurt-listed shares rose 2.6 percent.

The European Central Bank sees no risk of a banking crisis in the Euro zone despite some “individual cases” of lenders in trouble, ECB supervisor Ignazio Angeloni said.

At 11:03 a.m. ET (1503 GMT), the Dow Jones Industrial Average was up 103.82 points, or 0.57 percent, at 18,272.27.

The S&P 500 was up 9.03 points, or 0.42 percent, at 2,159.52.

The Nasdaq Composite was up 28.48 points, or 0.54 percent, at 5,318.14.

Seven of the 11 major S&P 500 indexes were higher, with energy rising 1.4 percent. Exxon Mobil was up 0.6 percent and Chevron 0.9 percent.

Chesapeake Energy rose 5.8 percent and was the biggest gainer on the S&P.

High-dividend paying sectors telecom services, consumer staples and utilities were the worst hit.

Twitter rose 4.4 percent after the Wall Street Journal reported that the micro-blogging website is expected to field bids this week.

Advancing issues outnumbered decliners on the NYSE by 1,899 to 922. On the Nasdaq, 1,901 issues rose and 702 fell.

The S&P 500 index showed 15 new 52-week highs and four new lows, while the Nasdaq recorded 64 new highs and 15 new lows.

Sterling steadies after fall below $1.27

An employee is seen walking over a mosaic of pound sterling symbols set in the floor of the front hall of the Bank of England in London, in this March 25, 2008 file photograph. REUTERS/Luke Macgregor/filesLONDON (Reuters) – Britain’s pound steadied on Wednesday after growing fears of a ‘hard’ Brexit from the European Union briefly drove it below $1.27 for the first time since 1985.

After hitting a 5-year trough against a broadly stronger euro in early trade in London, sterling recovered ground, helped by Prime Minister Theresa May’s raising doubts over the side effects of ultra-low interest rates and money-printing.

The currency has been buffeted for a fortnight by worries that Britain will prioritise curbing immigration over promoting trade in its divorce from the bloc, perceived as posing further risks to growth and encouraging more stimulus from the Bank of England.

But May added to signs of a shift in thinking by policymakers globally away from monetary stimulus and in favour of governments doing more. That could instead push yields on sterling-denominated government bonds higher.

“We have seen some movements with the different comments today,” said Craig Erlam, a market analyst with Oanda in London.

“May’s comments had an effect but the pound is mainly just correcting a bit after the moves of the past few days.”

Sterling hit a 31-year low of $1.2686 early on Wednesday before recovering to $1.2758, 0.2 percent higher on the day. It fell as much as 0.5 percent to 88.43 pence per euro before also clawing its way back into positive territory.

The broad takeaway for markets from this week’s conference of May’s ruling Conservative Party has been its intention of prioritising the question of immigration. The pound has fallen past long-term lows set in early July in response.

Investors worry a ‘hard’ Brexit will gum up labour markets, weaken foreign investment and encourage banks and other global companies to cut back on jobs and operations in Britain.

A report on Tuesday commissioned by consultancy firm Oliver Wyman said Britain’s financial industry could lose up to 38 billion pounds ($48.3 billion) in revenue if the deal leaves it with restricted access to the EU single market.

“Sterling can fall further given the UK’s balance of payments vulnerability and likely future constitutional uncertainty,” said Roger Hallam, Currencies Chief Investment Officer with JP Morgan Asset Management in London.

“The pound is relatively cheap against most currencies when viewed from a historical standpoint. We believe this discount is well warranted and will likely extend further given the additional risk premium international investors will require to invest in the UK and sterling denominated assets.”

Better-than-expected readings of sentiment among construction and manufacturing purchasing managers this week have done little to brighten the mood. Services numbers were also better than forecast but not initially enough to pull it higher on the day.

Before May’s speech, Deputy Governor Ben Broadbent told a Wall Street Journal event that the Bank of England could raise interest rates if sterling fell sharply enough, but said that so far its moves have been orderly.

“Sterling has finally and belatedly responded to the heightened and prolonged Brexit uncertainty, notwithstanding a resilient UK economy and prospects of significant UK fiscal stimulus,” said Greg Gibbs, director of independent research house Amplifying Global FX Capital.

“The outlook remains negative, but it is risky to jump on the selling bandwagon.”

Tata Motors to hike prices of passenger vehicles

Image result for Tata Motors to hike prices of passenger vehiclesNew Delhi, Oct 2 (IANS) Automobile major Tata Motors plans to raise prices of its passenger vehicles during the ongoing festive season to offset increasing input cost, the company said.

“We will hike prices of our vehicles. Currently we are working out the details,” Tata Motors President (Passenger Vehicles Business Unit) Mayank Pareek told reporters here on Saturday, following release of monthly sales figures by auto manufacturers.

“Input costs have increased and some of the industry players have already undertaken price hikes. Moreover, we have also not corrected our prices for a long time,” he added.

To a question on a timeline for effecting the price increase, he said: “It could be during the festive season.”

Passenger cars, utility vehicles and two-heeler manufacturers reported positive sales growth for last month.

Tata Motors sells a range of passenger vehicles, including the small car Nano, the newly launched hatchback Tiago and crossover vehicle Aria, at a price range of Rs 2.15 lakh to Rs 16.3 lakh (ex-showroom Delhi).

Tata Motors passenger and commercial vehicle sales, including exports in September, increased by eight per cent to 48,648 vehicles from 45,215 vehicles sold in the like month of 2015.

The company’s domestic sales of Tata commercial and passenger vehicles for the month under review rose by five per cent to 42,961 units. Exports during September zoomed by 29 per cent to 5,687 units.

Wall Street rally continues after Fed rate decision

REUTERS – U.S. stocks soared on Thursday, with the Nasdaq hitting a record intraday high, a day after the Federal Reserve stood pat on interest rates.

While the Fed said the risks to economic outlook were roughly “balanced”, it left rates unchanged as inflation continued to run below its 2 percent target and members saw room for improvement in the labor market.

The Fed also slowed the pace of future hikes and cut its longer run interest rate forecast, but sent a strong signal for a move by the end of this year.

The consensus among economists is for a hike in December as the Fed’s November meeting comes right around the U.S. Presidential elections.

The probability of a November hike stands at a modest 12.4 percent and rises to 58.4 percent for December, according to the CME Group’s FedWatch tool.

“Clearly the markets view the Fed’s inaction as favorable… but if you read between the lines, the Fed is concerned about the strength of the economy,” said Matt Schreiber, chief investment officer at WBI Investments in Red Bank, New Jersey.

“The Fed and central banks worldwide have been providing investors with a sense of calm and complacency.”

The dollar index dropped 0.5 percent on Thursday, and was on track to mark the second straight day of losses after the central bank’s decision.

Oil prices rose about 1.6 percent as the dollar fell and U.S. crude inventories recorded a surprise drop. [O/R]

Adding some support to the Fed’s plans for at least one hike this year was a report that showed the number of Americans applying for unemployment last week fell to a two-month low.

At 11:08 a.m. ET (1508 GMT), the Dow Jones Industrial Average was up 124.2 points, or 0.68 percent, at 18,417.9. All 30 of the its components were higher.

The S&P 500 was up 12.46 points, or 0.58 percent, at 2,175.58.

The Nasdaq Composite was up 32.08 points, or 0.61 percent, at 5,327.26, after rising as much as 0.76 percent to a record of 5335.82.

The technology index rose 0.5 percent, giving the benchmark S&P 500 index its biggest boost.

Shares of Amazon.com touched a record after BMO raised its price target to $900. The stock gave the S&P 500 and the Nasdaq their biggest boost.

Apple rose 0.9 percent to $114.56 and was the top influence on the S&P and the Nasdaq after Nomura and RBC raised their price targets.

JPMorgan rose 0.5 percent and was the top boost on the S&P financial index after striking a deal with Wal-Mart to process payments.

Red Hat rose 6.7 percent to $82.27 after the Linux operating system distributor reported second-quarter revenue and profit that beat market expectations.

Advancing issues outnumbered decliners on the NYSE by 2,537 to 417. On the Nasdaq, 1,899 issues rose and 729 fell.

The S&P 500 index showed 27 new 52-week highs and no new lows, while the Nasdaq recorded 115 new highs and nine new lows.

Sensex, Nifty fall; Fed, BOJ outcomes awaited

A man looks at a screen across a road displaying the Sensex on the facade of the Bombay Stock Exchange (BSE) building in MumbaiREUTERS – Indian shares fell on Tuesday after four sessions of gains as sentiment across the globe was cautious ahead of the outcomes of the Federal Reserve and the Bank of Japan’s policy meetings later this week.

The consensus is that the Fed will leave interest rates unchanged, but investors are looking for commentary and guidance for the next interest rate hike.

Meanwhile, the BOJ could make negative interest rates the primary focus of its monetary policy at the conclusion of its meeting on Wednesday.

MSCI’s broadest index of Asia-Pacific shares outside Japan fell 0.2 percent after major U.S. indexes ended a choppy session nearly flat on Monday. “It’s more of a global phenomenon which is affecting the market,” said R.K. Gupta, managing director, Taurus Asset Management.

The Nifty was down 0.33 percent at8,779.20 as of 0626 GMT, dragged lower by financial and IT stocks.

The Sensex was 0.34 percent lower at 28,538.19.

Investors booked profits in sectors such as auto and banks that have gained recently.

The Nifty Auto index was down 0.61 percent after rising about 23 percent this year as of Monday’s close. Hero MotoCorp Ltd, which was the top percentage loser, fell as much as 2.11 percent.

The NSE Bank index was down 0.39 percent, having risen 0.60 percent this month as of Monday’s close.

Jubilant FoodWorks Ltd’s shares fell as much as 8.21 percent to their lowest in over seven months after the company on Monday approved the resignation of Ajay Kaul as CEO-cum-whole time director.

Jio says Airtel gesture welcome, but won’t address call drops

Image result for Jio says Airtel gesture welcome, but won't address call dropsMumbai, Sep 18 (IANS) Reliance Jio on Sunday welcomed Bharti Airtel’s decision to provide better interconnection for its calls. But it also said the number of such points proposed remained substantially less than actual requirement — and won’t be able to address the issue of large-scale call drops.

“Based on the current traffic flow between the two networks, the proposed augmentation by Airtel would still only suffice for less than one-fourth of the required interconnection capacity,” a Jio statement said.

“More than two crore calls are failing everyday between the two networks, which is far in excess of the quality of service parameters and of alarming proportions. Urgent steps are required to be taken in the interest of customers of both operators,” the statement said.

“It is unfortunate that the Telecom Regulatory Authority’s intervention was required for Airtel to resume augmentation of points of interconnection, which it ought to have done by itself in compliance with its license terms.”

The statement comes a day after Airtel said it has received the payments due on interconnection from Jio and that after executing the agreed augmentation in such points, their total number will be three times that at present. It also said the capacity will be sufficient to serve over 15 million Jio customers, and added it will be much more than Jio’s subscriber base.

“While the interconnect agreement provides for a commissioning period of 90 days from the day Reliance Jio makes the payment, Airtel will work towards releasing the points of interconnect well ahead of the contractual obligation,” said Airtel.

But this point was refuted by Jio.

“The Telecom Regulatory Authority of India’s regulation does not provide for 90 days to adhere to quality of service parameters. The authority in fact instructed the incumbent operators to urgently provide requisite interconnection capacities to maintain quality of service parameters and not to make this subject to any contingencies or restrictions.”

Jio also found fault with the type of interconnection points Airtel was offering, and said it was a clear case of abuse of market dominance.

“It appears that the quality of service will continue to suffer and Indian customers will be denied the benefits of superior and free voice services as a result of such anti-competitive behaviour.”

The company said Airtel has been blocking mobile number portability for migration of potential subscribers to Jio.

Oil extends gains after data shows huge stock draw

Image result for Oil extends gains after data shows huge stock drawTOKYO (Reuters) – Oil prices extended gains by more than 1.5 percent on Thursday after industry data showed what might be the largest weekly drawdown in crude stocks in over three decades.

U.S. crude stocks surprisingly plunged by 12.1 million barrels last week, data from the American Petroleum Institute showed after market settlement on Wednesday, compared with expectations for an increase of around 200,000 barrels.

If official data released from the U.S. government later on Thursday confirms the draw, it would be the largest one-week decline since April 1985.

London Brent crude for November delivery had climbed 66 cents to $48.64 a barrel by 0641 GMT, after settling up 72 cents on Wednesday.

NYMEX crude for October delivery was up 76 cents at $46.26, having ended the previous session up 67 cents.

U.S. crude stocks have been at record highs in the last two years, thanks in part to the shale oil boom that boosted output. Some analysts said Tropical Storm Hermine, which threatened the Gulf Coast refining region late last week before moving to the U.S. East Coast, may have skewed the figures.

“I’m surprised at the big draw,” said Tomomichi Akuta, senior economist at Mitsubishi UFJ Research and Consulting in Tokyo. “Despite a possible temporary effect (from the tropical storm), it raised concerns of supply/demand tightening significantly.”

Analysts said a large decline in U.S. gasoline stocks also supported oil.

Gasoline stocks fell 2.3 million barrels, compared with expectations for a 171,000-barrel decline, the API data showed. Distillate stockpiles, which include diesel and heating oil, rose 944,000 barrels, compared with expectations for a 684,000-barrel gain.

Oil was also buoyed by robust Chinese trade data, which showed its crude imports in August surged by nearly a quarter from a year ago to the second-highest amount ever, driven by independent refiners as they rushed to cash in on low oil prices before their import quotas expire in December.

Oil hit a one-week high on Monday after Russia and Saudi Arabia agreed to cooperate on stabilising the oil market. Prices have since fallen due to uncertainty over a possible deal by producer nations to freeze output, particularly after a meeting in Doha in April ended without such an agreement.

The Organization of the Petroleum Exporting Countries and non-OPEC producers such as Russia are expected to discuss the issue at informal talks in Algeria from Sept. 26-28.

China’s Xi at G20 says world economy at risk, warns against protectionism

Image result for China's Xi at G20 says world economy at risk, warns against protectionismHANGZHOU, China (Reuters) – The global economy is being threatened by rising protectionism and risks from highly leveraged financial markets, Chinese President Xi Jinping said at the open of a two-day summit of leaders from G20 nations.

His warning on Sunday followed bilateral talks with Barack Obama that the U.S. president described as “extremely productive”, but which failed to bring both sides closer on thornier topics such as tensions in the South China Sea.

With the summit taking place after Britain’s vote in June to exit the European Union and before the U.S. presidential election in November, observers expect G20 leaders to mount a defence of free trade and globalisation and warn against isolationism.

The global economy has arrived “at a crucial juncture”, Xi said, in the face of sluggish demand, volatile financial markets and feeble trade and investment.

“Growth drivers from the previous round of technological progress are gradually fading, while a new round of technological and industrial revolution has yet to gain momentum,” he said.

G20 countries are set to agree in a communique at the end of the summit that all policy measures – including monetary, fiscal and structural reforms – should be used to achieve solid and sustainable economic growth, Japanese Deputy Chief Cabinet Secretary Koichi Hagiuda said.

“Commitment will be made to utilising all three policy tools of monetary and fiscal policies and structural reforms to achieve solid, sustainable, balanced and inclusive growth,” Hagiuda told reporters on the sidelines of the summit.

Xi also called on G20 countries to match their words with actions.

“We should turn the G20 group into an action team, instead of a talk shop,” he said.

But some of the G20 leaders have begun drawing battle lines in disputes over issues ranging from trade and investment to tax policy and industrial overcapacity.


On Sunday, Xi held talks with Australian Prime Minister Malcolm Turnbull and told him he hoped Australia would continue to provide a fair, transparent and predictable policy environment for foreign investors.

China was angered when Australia blocked the A$10 billion ($7.7 billion) sale of the country’s biggest energy grid to Chinese bidders last month.

China has accused Australia of bowing to protectionist sentiment in blocking the bid for Ausgrid, as well as an earlier one by a China-led consortium to buy cattle company Kidman & Co.

Beijing has also criticised Australia, a staunch U.S. ally, for running surveillance flights over disputed islands in the South China Sea.

Meanwhile, European Commission President Jean-Claude Juncker said China must set up a mechanism to address its problem of industrial overcapacity, saying it was “unacceptable” the European steel industry had lost so many jobs in recent years.

“Overcapacity is a global problem but there is a particular Chinese element,” he told a news conference.

Britain’s future after its departure from the European Union was also subject to discussion.

Obama reassured Prime Minister May that Britain’s closest political, commercial and military ally would stand by her.

But he did not shrink away from his stance that Brexit was a mistake and that London would not be able to jump the queue to arrange a bilateral trade deal.

Juncker said that if Britain wanted access to the European Union’s common market, it needed to respect the rules of the common market.

Turnbull, meanwhile, said Australia wanted an early free trade agreement with Britain so markets could remain open between them when Britain formally left the European trading bloc.


Obama held talks with Xi on Saturday that ran late into the night.

He urged Beijing to uphold its legal obligations in the disputed waters of the South China Sea, and stressed U.S. commitments to its regional allies.

Xi said China would continue to safeguard its sovereignty and maritime rights in the South China Sea.

But China is keen to keep the summit focused on economic issues and to prevent other disputes from overshadowing it.

According to a “fact sheet” on China-U.S. relations issued on Sunday, the two sides agreed on a range of issues, including avoiding competitive currency devaluations and not limiting deal opportunities for foreign information and communication technology providers.

Obama, now in the last five months of his presidency, is using the visit to put a final stamp on his signature policy shift toward the Pacific, setting the tone for his White House successor, who will be elected in November and take office on Jan. 20.

His visit began chaotically at the Hangzhou airport, where his staff argued with Chinese security over media access. Obama said on Sunday he “wouldn’t over-crank the significance” of the airport events.

“None of this detracts from the broader scope of the relationship (with China),” he told a news conference. “The bilateral discussions that we had yesterday were extremely productive and continue to point to big areas of cooperation.”

Security was extremely tight in Hangzhou, with parts of the city of 9 million people turned into a virtual ghost town as China seeks to ensure that the G20 summit stays incident-free.

(Additional reporting by Sue-Lin Wong, Michael Martina, Roberta Rampton, Ruby Lian, Kiyoshi Takenaka, Vladimir Soldatkin, William James and Engen Tham in HANGZHOU, and Ben Blanchard, Nick Heath, Jason Subler and John Ruwitch in BEIJING; Writing by Raju Gopalakrishnan and John Ruwitch; Editing by Ryan Woo)

Financial Tips For Young Adults

Unfortunately, personal finance has not yet become a required subject in high school or college, so you might be fairly clueless about how to manage your money when you’re out in the real world for the first time.

To help you get started, we’ll take a look at eight of the most important things to understand about money if you want to live a comfortable and prosperous life.

Learn Self Control
If you’re lucky, your parents taught you this skill when you were a kid. If not, keep in mind that the sooner you learn the fine art of delaying gratification, the sooner you’ll find it easy to keep your finances in order. Although you can effortlessly purchase an item on credit the minute you want it, it’s better to wait until you’ve actually saved up the money. Do you really want to pay interest on a pair of jeans or a box of cereal? (To learn more about credit, check out Understanding Credit Card Interest and our Debt Management feature.)

If you make a habit of putting all your purchases on credit cards, regardless of whether you can pay your bill in full at the end of the month, you might still be paying for those items in 10 years. If you want to keep your credit cards for the convenience factor or the rewards they offer, make sure to always pay your balance in full when the bill arrives, and don’t carry more cards than you can keep track of.

Take Control of Your Own Financial Future
If you don’t learn to manage your own money, other people will find ways to (mis)manage it for you. Some of these people may be ill-intentioned, like unscrupulous commission-based financial planners. Others may be well-meaning, but may not know what they’re doing, like Grandma Betty who really wants you to buy a house even though you can only afford a treacherous adjustable-rate mortgage.

Instead of relying on others for advice, take charge and read a few basic books on personal finance. Once you’re armed with personal finance knowledge, don’t let anyone catch you off guard – whether it’s a significant other that slowly siphons your bank account or friends who want you to go out and blow tons of money with them every weekend. Understanding how money works is the first step toward making your money work for you. (To find out how to have fun and still save money, see Budget Without Blowing Off Your Friends.)

Know Where Your Money Goes
Once you’ve gone through a few personal finance books, you’ll realize how important it is to make sure your expenses aren’t exceeding your income. The best way to do this is by budgeting. Once you see how your morning java adds up over the course of a month, you’ll realize that making small, manageable changes in your everyday expenses can have just as big of an impact on your financial situation as getting a raise.

In addition, keeping your recurring monthly expenses as low as possible will also save you big bucks over time. If you don’t waste your money on a posh apartment now, you might be able to afford a nice condo or a house before you know it. (Read more on budgeting in our Budgeting special feature.)

Start an Emergency Fund
One of personal finance’s oft-repeated mantras is “pay yourself first”. No matter how much you owe in student loans or credit card debt, and no matter how low your salary may seem, it’s wise to find some amount – any amount – of money in your budget to save in an emergency fund every month.
Having money in savings to use for emergencies can really keep you out of trouble financially and help you sleep better at night. Also, if you get into the habit of saving money and treating it as a non-negotiable monthly “expense”, pretty soon you’ll have more than just emergency money saved up: you’ll have retirement money, vacation money and even money for a home down payment.

Don’t just sock away this money under your mattress; put it in a high-interest online savings account, a certificate of deposit or a money market account. Otherwise, inflation will erode the value of your savings.

Start Saving for Retirement Now
Just as you headed off to kindergarten with your parents’ hope to prepare you for success in a world that seemed eons away, you need to prepare for your retirement well in advance. Because of the way compound interest works, the sooner you start saving, the less principal you’ll have to invest to end up with the amount you need to retire and the sooner you’ll be able to call working an “option” rather than a “necessity.”

Company-sponsored retirement plans are a particularly great choice because you get to put in pretax dollars and the contribution limits tend to be high (much more than you can contribute to an individual retirement plan). Also, companies will often match part of your contribution, which is like getting free money. (To learn more, see Understanding The Time Value Of Money and Retirement Savings Tips For 18- To 24-Year-Olds.)

Get a Grip on Taxes
It’s important to understand how income taxes work even before you get your first paycheck. When a company offers you a starting salary, you need to know how to calculate whether that salary will give you enough money after taxes to meet your financial goals and obligations. Fortunately, there are plenty of online calculators that have taken the dirty work out of determining your own payroll taxes, such as Paycheck City. These calculators will show you your gross pay, how much goes to taxes and how much you’ll be left with, which is also known as net, or take-home pay.

For example, $35,000 a year in New York will leave you with around $26,430 after taxes without exemptions in 2015, or about $2,032 a month. By the same token, if you’re considering leaving one job for another in search of a salary increase, you’ll need to understand how your marginal tax rate will affect your raise and that a salary increase from $35,000 a year to $41,000 a year won’t give you an extra $6,000, or $500 per month – it will only give you an extra $4,129, or $344 per month (again, the amount will vary depending on your state of residence). Also, you’ll be better off in the long run if you learn to prepare your annual tax return yourself, as there is plenty of bad tax advice and misinformation floating around out there. (To learn all about your taxes, visit our Income Tax Guide.)

Guard Your Health
If meeting monthly health insurance premiums seems impossible, what will you do if you have to go to the emergency room, where a single visit for a minor injury like a broken bone can cost thousands of dollars? If you’re uninsured, don’t wait another day to apply for health insurance; it’s easier than you think to wind up in a car accident or trip down the stairs.

You can save money by getting quotes from different insurance providers to find the lowest rates. Also, by taking daily steps now to keep yourself healthy, like eating fruits and vegetables, maintaining a healthy weight, exercising, not smoking, not consuming alcohol in excess, and even driving defensively, you’ll thank yourself down the road when you aren’t paying exorbitant medical bills.

Guard Your Wealth
If you want to make sure that all of your hard-earned money doesn’t vanish, you’ll need to take steps to protect it. If you rent, get renter’s insurance to protect the contents of your place from events like burglary or fire. Disability insurance protects your greatest asset – the ability to earn an income – by providing you with a steady income if you ever become unable to work for an extended period of time due to illness or injury.

If you want help managing your money, find a fee-only financial planner to provide unbiased advice that’s in your best interest, rather than a commission-based financial advisor, who earns money when you sign up with the investments his or her company backs. You’ll also want to protect your money from taxes, which is easy to do with a retirement account, and inflation, which you can do by making sure that all of your money is earning interest through vehicles like high-interest savings accounts, money market funds, CDs, stocks, bonds and mutual funds. (Find out all you need to know about insurance in Understand Your Insurance Contract, Five Insurance Policies Everyone Should Have and Insurance 101 For Renters.)

The Bottom Line
Remember, you don’t need any fancy degrees or special background to become an expert at managing your finances. If you use these eight financial rules for your life, you can be as personally prosperous as the guy with the hard-won MBA.

This Is What A Financial Crisis Looks Like

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Just within the past few days, three major high yield funds have completely imploded, and panic is spreading rapidly.  Funds run by Third Avenue Management and Stone Lion Capital Partners have suspended payments to investors, and a fund run by Lucidus Capital Partners has liquidated its entire portfolio. 

We are witnessing a race for the exits unlike anything that we have seen since the great financial crash of 2008, and many of those that choose to hesitate are going to end up getting totally wiped out.  In case you are wondering, this is what a financial crisis looks like.  In 2008, other global stock markets started to tumble, then junk bonds began to crash, and finally U.S. stocks followed.  The exact same pattern is playing out again, and the carnage that we have seen so far is just the tip of the iceberg.

Since the end of 2009, a high yield bond ETF that I watch very closely known as JNK has been trading in a range between 36 and 42.  I have been waiting all this time for it to dip below 35, because I knew that would be a sign that the next major financial crisis was imminent.

In September, it closed as low as 35.33 at one point, but that was not the signal that I was looking for.  Finally, early last week JNK broke below 35 for the very first time since the last financial crisis, and since then it has just kept on falling.  As I write this, JNK has plummeted all the way to 33.42, and Bloomberg is reporting that many bond managers “are predicting more carnage for high-yield investors”…

Top bond managers are predicting more carnage for high-yield investors amid a market rout that forced at least three credit funds in the past week to wind down.

Lucidus Capital Partners, a high-yield fund founded in 2009 by former employees of Bruce Kovner’s Caxton Associates, said Monday it has liquidated its entire portfolio and plans to return the $900 million it has under management to investors next month. Funds run by Third Avenue Management and Stone Lion Capital Partners have stopped returning cash to investors, after clients sought to pull too much money.

When it says that those firms “have stopped returning cash to investors”, what that means is that many of those investors will be lucky to get pennies on the dollar when it is all said and done.

Like I said, now that the crisis has started, the ones that are going to lose the most are those that hesitate.

And just check out some of the very big names that are “warning of more high-yield trouble ahead”…

Scott Minerd, global chief investment officer at Guggenheim Partners, predicts 10 percent to 15 percent of junk bond funds may face high withdrawals as more investors worry about getting their money back. He joins money managers Jeffrey GundlachCarl IcahnBill Gross and Wilbur Ross in warning of more high-yield trouble ahead.

In this type of environment, the Federal Reserve would have to be completely insane to raise interest rates.

Unfortunately, that appears to be exactly what is going to happen.

If the Fed raises rates, that is going to make corporate debt defaults even more likely and will almost certainly drive high-yield bonds down even further…

Higher rates could make corporate bond defaults more likely and investors are already bailing out of the sector, pulling $3.8 billion out of high-yield funds in the week ended December 9, the biggest move in 15 weeks. The effective yield on U.S. junk bonds is now 17 percent, the highest level in five years, according to Bank of America Merrill Lynch data.

A whole host of prominent names are warning that the Fed is about to make a tragic mistake.  One of them is James Rickards…

“The Fed should have raised interest rates in 2010 and 2011 and if they did that they would actually be in a position to cut them today,” said James Rickards, a central bank critic and chief global strategist at West Shore Funds. “The Fed is on the brink of committing a historic blunder that may rank with the mistakes it made in 1927 and 1929. By raising into weakness, they will likely cause a recession.”

In 2015, we have already seen stocks crash all over the globe.  Coming into December, more than half of the 93 largest stock market indexes in the worldwere down more than 10 percent year to date, and some of them were down by as much as 30 or 40 percent.  At this point, conditions are absolutely perfect for a frightening collapse of U.S. markets, and the Federal Reserve is about to pour gasoline on to the fire.

Anyone that says that “nothing is happening” is either completely misinformed or is totally crazy.

I like how James Howard Kunstler summarized what we are currently facing…

Equities barfed nearly four percent just last week, credit is crumbling (nobody wants to lend), junk bonds are tanking (as defaults loom), currencies all around the world are crashing, hedge funds can’t give investors their money back, “liquidity” is AWOL (no buyers for janky securities), commodities are in freefall, oil is going so deep into the sub-basement of value that the industry may never recover, international trade is evaporating, the president is doing everything possible in Syria to start World War Three, and the monster called globalism is lying in its coffin with a stake pointed over its heart.

The financial markets held together far longer than many people thought that they would, but now they are finally coming apart at the seams.

Moving forward, the “winners” are going to be the people that pull their money out the fastest.  This is especially true for high risk funds like the three that just imploded.  If you hesitate, you could end up losing everything.

And as this rush for the exits accelerates, sellers are going to greatly outnumber buyers, and this is going to push prices down at a very rapid pace.  We are going to hear a lot about a “lack of liquidity” in the days ahead, but the truth is that what we will really be looking at is a good old-fashioned panic.