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A Wealth of Information
October 01, 2006
PNC Financial Services Group surveyed 795 Americans with between $500,000 and $1 million in investable assets and 690 with more than $1 million, including 225 with more than $5 million and 116 with more than $10 million. Here are some of the results:
Holdings
High net worth investors have not made major shifts in their investment portfolios over the past year. On average, they have 46% in stocks and 16% in cash investments.
56% do not have any of their assets in investment real estate outside of their primary residence.
Threats
50% ranked declining U.S. economic competitiveness to other nations as the second-greatest threat to their family's wealth -- behind a major decline in the stock market.
About one-third say a lack of Social Security benefits would be a major wealth threat for them and their families.
One-third fear that healthcare costs will consume a larger portion of their assets.
One-quarter are providing direct financial support to their parents, with an average of $6,700 a year.
Retirement
When asked how much they would need to feel completely financially secure in retirement:
Those with less than $1 million in investable assets say on average $16 million.
Those with $1 million or more in assets say $10.8 million
Those with $5 million or more say $21.2 million.
Those with $10 million or more say $30.8 million.
Planning
One-quarter of all respondents -- and 31% of those with more than $10 million -- do not have a will. Almost half of all respondents don't have a trust.
Restructuring
October 01, 2006
More than 20 years ago, the Florida Legislature set up the Florida Black Business Investment Board (FBBIB) to help African-American businesses with funding and technical assistance. Since then, the board has operated primarily through its lending arm, the Florida Black Business Support Corp., and eight affiliated regional lending organizations called Black Business Investment Corporations (BBICs).
It's hard to call the effort a success. For one, funding has been thin. Through the years, the state has appropriated $9.2 million for the FBBIB's administrative operations, along with $18.6 million for "capitalization" -- basically the loan programs. Only about half of the loan capital went to the eight regional BBICs, which over 20 years amounts to less than $60,000 a year to each. And the BBICs received no funds for administrative expenses.
Gerald Chester, president of the Central Florida Community Development Corp., which manages the East Central BBIC, isn't happy with either the state or the FBBIB. "The amount of resources that the state made available in total to African-American businesses would be appalling to anyone," he says.The past few years have also been turbulent because of questions about the organization's structure, particularly the relationship between the FBBIB and the local BBICs.
A 2003 audit by the Florida Office of the Inspector General found "a breakdown in accountability." Among the numerous findings were that the BBICs hadn't collected, documented, verified or reported reliable performance measurement data. The audit said the performance of the local organizations' loan and loan guarantee portfolios could not be accurately determined.
Economic growth in 2007 weak but hiring holds up
January 30, 2008
Growth in the U.S. economy slowed abruptly in the fourth quarter as consumers curbed spending and home building plunged, according to a government report on Wednesday that kept fears of recession alive.
The Commerce Department said gross domestic product, a measure of total goods and services output within U.S. borders, grew at an annual rate of 0.6 percent in the last quarter of 2007, while it expanded 2.2 percent over the whole year, the slowest pace in five years.
"No question, the GDP number tells us the economy is on the brink of recession, if not in one already," said Peter Boockvar, an equity strategist with Miller Tabak & Co. in New York.
A private sector report showing employers added three times as many jobs as expected in January lifted some of the gloom surrounding the growth figures. ADP Employer Services said U.S. private employers added 130,000 jobs in January.
That led some analysts to boost forecasts for the number of new jobs in January, which the Labor Department will announce on Friday in its closely watched report on U.S. hiring.
There have been other reassuring hints recently of resilience in the economy, including robust orders for manufactured goods in December and lower weekly claims for jobless benefits.
That did not stop the U.S. Federal Reserve from cutting its benchmark federal funds rate by one-half percentage point to 3 percent, citing a deepening of the housing slump and some softening in labor markets.
U.S. stocks rallied after the cut in benchmark U.S. short-term interest rates -- the second in just over a week -- but quickly shed the gains after a CNBC television report that said two big bond insurers faced possible ratings downgrades.
Economy Gained Strength In 2006
February 01, 2007
The U.S. economy turned in a surprisingly strong performance last year, new data show, growing 3.4 percent despite higher interest rates, high oil prices and the sharpest housing downturn in 15 years.
The report from the Commerce Department, showing that economic growth picked up in 2006 from the 3.2 percent growth of 2005, dispelled any lingering doubts about the momentum of the economy going into this year. Many economists predict growth will slow this year, but gone are the recession worries of last summer.
"Nothing, other than an external shock, will derail the economy this year," said Eugenio J. Alem?n, senior economist at Wells Fargo. "The economy's in good shape."
Unemployment and inflation fell last year while wages and salaries rose at their quickest pace in five years, according to a series of recent government reports. The reports suggest that troubles in housing and manufacturing, though painful for many people, have not caused the widespread economic damage that many experts had feared.
Federal Reserve policymakers held short-term interest rates steady yesterday, showing they are content -- at least for now -- with the state of the economy. They left their benchmark rate on overnight loans between banks unchanged at 5.25 percent, where it has been since June. But they indicated that they remain ready to raise borrowing costs if strong economic growth fuels a fresh bout of inflation.
President Bush hailed the news in a speech extolling the strong "state of the economy" on Wall Street, where he was also mobbed visiting the floor of the New York Stock Exchange. "As we begin this New Year, America's businesses and entrepreneurs are creating new jobs every day," he said. "Workers are making more money; their paychecks are going further. Consumers are confident, investors are optimistic."
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