The President plans to levy tariffs on steel and aluminum, even though tariffs have previously been proven ineffective. So what’s really going on?

Look, there is perhaps no other place that has been hit harder by the decline of the steel industry than Pittsburgh and its surrounding areas.

And to be clear, I’m as Pittsburgh as it gets. I was born and raised there. I got my engineering degree from the University of Pittsburgh and my MBA from Carnegie Mellon. I built my business there. Our football team, and the best football team on the planet, is called the Steelers.

So I get it.

I’d love for my friends, family and neighbors to take care of themselves and their families with good, blue collar jobs in the area. But the reality is, most of those jobs aren’t coming back.

Yet, Pittsburgh has flourished because it decided to stop trying to hold on to the economy of the past, and made an intentional shift toward the economy of today and tomorrow by putting a focus on eds, meds and high technology.

Which is why the tariffs seem so misguided, since tariffs in general don’t work, and more specifically won’t do much to change the landscape of the steel industry in this country.

But the President has made empty promises like this before. He stood in front of a bunch on worried workers at a Carrier plant in Indiana, and insisted that he had “saved their jobs” by negotiationg a deal with the company. Then, Carrier STILL shipped the jobs to Mexico that it had planned to send there and it also took millions of dollars in handouts from the state.

Is that the art of the deal?

Why is Britain affecting US markets?

I had the exciting opportunity to share my thoughts with an international audience on CNN Newsroom with Fredricka Whitfield, where I engaged in a debate on this topic with former Trump economic adviser Stephen Moore.

Check out the video above for my thoughts on the tariffs and what we should really be doing for displaced workers in America.

You may have never been to the UK, but what just happened there is affecting your money

Brexit.

Hopefully the first time you heard that word wasn’t last Friday when the Dow Jones tanked by 600 points and it suddenly dawned on you that your 401k was dropping too.

Just in case you still haven’t heard the word, Brexit is short for the British exit from the European Union, which was voted for by the citizens of Britain last week.

If world politics isn’t your thing, let’s just say that the Brexit is kinda like Pittsburgh football fans voting for the Steelers to leave the NFL…even though they still want the team to play in NFL games and compete for the Superbowl.

Not quite sure how that would work?

Well, investors aren’t sure how the Brexit is going to work either and when investors are faced with too much uncertainty they sell…everything and a lot of it.

Why is Britain affecting US markets?

We’re more interconnected than you think.

​​​​​​​The folks who pushed for the vote to leave the UK probably did so wearing an Italian suit, a tie from China, driving a car from Japan while eating French Fries.

Large countries all sell things to each other, buy things from each other, invest in each other’s markets, etc.

When something this huge happens abroad, the affect will inevitable trickle down to our investments at home.

Ok, what does this mean for my 401k?

I’m glad you asked.

I had the exciting opportunity to share my thoughts with the entire country on CNN Newsroom with Fredricka Whitfield.

Check out the video above for my thoughts on this event and what you should do with your money from here.
 

 

Many of you were quite taken aback when you heard about the President’s new plan to tax the gain in 529 education savings accounts, and understandably so.

If you’re like a number of my clients, you’ve been saving for your children’s education with the understanding that your withdrawals would be tax free as long as the proceeds were used for qualified education expenses.

So, to hear that the benefit may no longer apply, is a like getting punched in the gut.

But, before we get too upset, let me shed some light on his proposal.

The proposal is unlikely to pass

To get straight to the punchline, the proposal doesn’t stand a snowball’s chance in an oven of passing.

With a Republican controlled House and Senate there’s very, very little chance of this proposal passing, particularly since the move is aimed at the rich.  Which brings me to the next point:

 

The proposal isn’t about education, it’s about wealth inequality

The White House says that 70% of the balances in 529 plans are owned by families that make more than 200k, so most of the benefits of the tax break are going to wealthy families that do not need the break to send their kids to college.

Well, wealthy people like tax breaks, so sure, they have taken advantage of it too.  Ironically, the POTUS and FLOTUS contributed a total of $240,000 into 529 plans for their daughters in 2008. Clearly they understand the benefit of the plans for themselves and middle class families.

Seems like a little cutting off your nose to spite your face going on here.

In my opinion, what the president wants the conversation during his last two years in office to be focused on the success, or lack thereof, of middle class families.  And he seems to be succeeding.

When he can get conservatives like Rand Paul, Paul Ryan and Mitt “I found a way to stash $100 inside of a tax-deferred IRA account” Romney to acknowledge and discuss wealth inequality, I’d say he’s making good political moves by making them play on his home field.

Ultimately, benefit may be left for some

If the goal truly is for this proposal to go anywhere, there may be a compromise by putting an income limit on the tax break, similar to the limit put on the deduction of student loan interest.

Taxpayers can only deduct interest on their student loans if they earn less than $80,000 or $160,000 if married filing jointly.

It seems logical that if the President truly wants the middle class to get out from underneath the $1 Trillion in student debt they are carrying, he won’t take away the incentive to save your own money to pay for college.

 

Two key questions remain

The debate over this issue is surely not over, and I’ll be sure to update you as it progresses.  But, in my mind, the discussion really raises two important questions:

1) How can we address wealth inequality in a way that doesn’t simultaneously penalize the middle class and,

2) Why is there a seemingly sole focus on college as the means to a successful life? Should we expand our horizons give all of the new tools and technology available for learning in demand skills?

Two important questions indeed.  We’ll tackle those soon.