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Higgins Capital Management, Inc.

Boom Economy, Higher Rates, and Game Plan

The Economy: By all metrics the US Economy continues to boom along. The most important take-away is that the Fed will continue to raise interest rates. The word on the street is that the Fed will continue to tighten "until something breaks." Don't let that something be you caught unaware. We continue to stress the dramatic change in US monetary policy. Interest rates are headed higher and the Fed is reducing their balance sheet. Liquidity will become an increasing issue for business planning. Ignore this at your own risk. Prime is now at 5%; up from 3.75. What happens to you at 7%? 9%?  "Won't happen" is the graveyard of the blind and arrogant. The Trump administration has shattered many of the supposedly sacred icons. To think that he will save the bloated and reckless TBTF banks in the next recession is a mistake. Jamie Dimon is increasingly sounding the alarm that the American voter will not tolerate another 2008 bank bailout. You can make book that this time it will be different. Plan accordingly.

Food for Thought:  Life is change; keep moving.  Business men and women inherently understand this. You're not shuffling paper waiting for retirement. You're charged with continually moving forward; constantly overcoming challenges. Not a moment passes without thinking about how to position for the future. Like a hunter; focused on offense with defense always in the picture. Now take that mind-set and look at what you're doing with your own money. Your retirement planning in particular. This is a late stage bull market. Are you thinking about your next play? If you're transitioning to a new job or the nirvana of retirement, have you taken the time to evaluate your options? Are you relying on the same game plan that worked under different circumstances? Are you relying on your headhunter to direct your finances? ... or worse, doing it yourself? ... performing brain surgery on yourself? Really? Rolling your compensation package and retirement assets to your next employer or the same advisor is the no-brainer. But it may be ill advised. Seek professional advice. Higgins Capital helps families navigate the complexities of wealth. Contact us