We hope everyone enjoyed the 4th of July and got an opportunity to enjoy plenty of fireworks, barbecue, parades and baseball with your families. Independence Day represents all that is great about the United States as we celebrate the anniversary of our independence from Great Britain. We have come a long way since our days as a fledgling colony nation. We have explored the continent, gone through a civil war, help win both World Wars, and have become the most powerful industrial nation on earth.
The global economy has gotten more complex over the last two-hundred and thirty three years. So while we celebrate our Independence, the nation’s financial independence needs some tweaking. America has been on a borrowing binge-consumers spent much of the last decade enjoying a bull market in both the stock market and real estate. During this time we racked up lots of debt and saw personal savings rates virtually non-existent. In addition Sub-prime loans and other financial “innovations” compounded the problem. The federal government did the same thing and kept adding to its deficit, and as a result the federal debt is now equal to the entire gross domestic product of our nation.
It took this recession to get consumers focused on savings again, and we think this is a long-term positive for the economy and investment markets. Hopefully, when the recession starts to fade, the federal and local governments will start to focus on reducing their debt as well as becoming less reliant on foreign investment. So we hope all enjoyed Independence Day, we look forward to the day when we will all be more financially independent!