Tuesday, August 25, 2015

5 THINGS INVESTORS SHOULDN'T DO NOW



We thought you would appreciate the article in the link below by Jason Zweig from the Wall Street Journal. He has very good advice for everyone regarding investor behavior.

http://blogs.wsj.com/briefly/2015/08/21/5-things-investors-shouldnt-do-now/

Jason Zweig writes The Intelligent Investor every Saturday for The Wall Street Journal. He is the author of Your Money and Your Brain, on the neuroscience of investing, and the editor of the revised edition of Benjamin Graham's The Intelligent Investor, the classic text that Warren Buffett has described as "by far the best book about investing ever written." Before joining the Journal, Jason was a senior writer for Money magazine and a guest columnist for Time magazine and CNN.com, and he also spent a year studying Middle Eastern history and culture at the Hebrew University in Jerusalem.

Sources:

LINK:  http://blogs.wsj.com/briefly/2015/08/21/5-things-investors-shouldnt-do-now/


Sincerely,
Bill Morrissey, CFP® and Tammy Prouty, CFP®
Sound Financial Planning, Inc.
Primary Office
425 Commercial St., Ste 203
Mount Vernon, WA 98273
Phone: (360) 336-6527

Secondary Office
650 Mullis St., Ste 101
Friday Harbor, WA 98250
(360) 378-3022

PLEASE READ THIS WARNING: All e-mail sent to or from this address will be received or otherwise recorded by the Sound Financial Planning, Inc. corporate e-mail system and is subject to archival, monitoring and/or review, by and/or disclosure to, someone other than the recipient. This message is intended only for the use of the person(s) ("intended recipient") to whom it is addressed. It may contain information that is privileged and confidential. If you are not the intended recipient, please contact the sender as soon as possible and delete the message without reading it or making a copy. Any dissemination, distribution, copying, or other use of this message or any of its content by any person other than the intended recipient is strictly prohibited. Sound Financial Planning, Inc. has taken precautions to screen this message for viruses, but we cannot guarantee that it is virus free nor are we responsible for any damage that may be caused by this message. Sound Financial Planning, Inc. only transacts business in states where it is properly registered or notice filed, or excluded or exempted from registration requirements. Follow-up and individualized responses that involve either the effecting or attempting to effect transactions in securities or the rendering of personalized investment advice for compensation, as the case may be, will not be made absent compliance with state investment adviser and investment adviser representative registration requirements, or an applicable exemption or exclusion. This information should not be construed as investment advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. WE WOULD LIKE TO CREDIT THIS ARTICLE'S CONTENT TO JASON ZWEIG.

Monday, August 24, 2015

HOW TO READ THE PANICKY MARKET

Some of the most entertaining times to be a long-term investor are those periods when short-term investors are looking over their shoulders for an excuse to sell.  They're convinced that the market is going to go down before they can get out, and so they jump on any bad news that comes across their Bloomberg screen.
 
And, of course, Friday was a marvelous time to see this in action.  With all the economic drama playing out in the world, there were plenty of opportunities to panic.  The Greek Prime Minister has resigned!  Sell!  China devalued its currency a few days ago by 2%!  Head for the hills!  Chinese stocks are tanking yet again!  Get out of American stocks while you can!  The Fed might raise short-term interest rates from zero to very nearly zero!  It's the end of the world!
 
Of course, a sober analyst might wonder whether a change in governance in a country whose GDP is a little less than half the market capitalization of Apple Computer Corp. is really going to move the needle on the value of U.S. stocks-especially now that Greece seems to have gotten the bailout it needs to stay in the Eurozone.  Chinese speculators are surely feeling pain as the Shanghai Composite Index goes into free-fall, but most U.S. investors are prohibited from investing in this tanking market.  If the market value of PetroChina, China Petroleum & Chemical and China Merchants Bank are less valuable today than they were a week or a month ago, does that mean that one should abandon U.S. stocks?  Does it mean that American blue chips are somehow less valuable?
 
What makes this dynamic entertaining-and sometimes scary-is the enhanced volatility around very little actual movement.  You see the market jump higher and faster, lower and faster, but generally returning to the starting point as people realize a day or two later that the panic was an overreaction, and so was the false exuberance of realizing that the world isn't going to come to an end just because we're paying less at the gas pump than we were last year.  Despite all the jitters investors have experienced over the past nine months, despite the drop on Friday, the S&P 500 is only down about 4% for the year, and was in positive territory as recently as August 19.
 
If you want a broader, more rational picture of our current economic situation, read this analysis by a long-term trader who now refers to himself as a"reformed broker"in Fortune magazine:

http://fortune.com/2015/08/20/american-economy-worries/
[click on link below in "Sources"]

He talks about the "terrible news"that it hasn't been this cheap to fill your gas tank in over a decade, and businesses that rely on energy to manufacture their goods are now forced to figure out what to do with the excess capital they're not spending on fuel.
 
Oh, but it gets worse.  American corporations are struggling under the burden of enormous piles of cash they don't have a use for.  They may have no choice but to return some of that money back to shareholders in the form of record dividends.  Of course, you read about the risk to corporate profit margins.  It seems that unemployment is so low that wages for American workers are going up, and that could raise consumption and demand for products and services.
 
Meanwhile, contributions to 401(k) and other retirement plans are up dramatically, housing starts and the construction sector are booming, America's biggest global economic competitor (China) is reeling, and the Federal Reserve might decide that it no longer has to keep short-term interest rates low because the emergency is over and the economy has recovered.  The author apologizes (tongue in cheek) for bringing us all this terrible news, but hey, we can always sell our stocks and get out until conditions improve.
 
Right?
 
Nobody would be surprised if the U.S. stock market suffered a 10%, 20%, or greater short-term decline, this year, or perhaps next year.  But what can you do with that information?  Nobody would have been surprised if this had happened at any point in the long bull market that doubled your stock investments.  Nobody can predict whether Friday was a signal that the market will take a pause or continue to decline, or if the market will bring us another wave of short-term euphoria measured mostly in sighs of relief.  And if you don't know when to sell in this jittery market, how will you know when to buy back? 
 
These short-term swings provide entertainment, but very little useful information for a mature investor.  If you aren't entertained by watching people sell in a panic and then panic-buy their way back in when they realize things aren't as dire as the headlines made them out to be, then you should probably watch a movie instead.
 
Sources:


Sincerely,
Bill Morrissey, CFP® and Tammy Prouty, CFP®
Sound Financial Planning, Inc.

Primary Office
425 Commercial St., Ste 203
Mount Vernon, WA 98273
Phone: (360) 336-6527

Secondary Office
650 Mullis St., Ste 101
Friday Harbor, WA 98250
(360) 378-3022


PLEASE READ THIS WARNING: All e-mail sent to or from this address will be received or otherwise recorded by the Sound Financial Planning, Inc. corporate e-mail system and is subject to archival, monitoring and/or review, by and/or disclosure to, someone other than the recipient. This message is intended only for the use of the person(s) ("intended recipient") to whom it is addressed. It may contain information that is privileged and confidential. If you are not the intended recipient, please contact the sender as soon as possible and delete the message without reading it or making a copy. Any dissemination, distribution, copying, or other use of this message or any of its content by any person other than the intended recipient is strictly prohibited. Sound Financial Planning, Inc. has taken precautions to screen this message for viruses, but we cannot guarantee that it is virus free nor are we responsible for any damage that may be caused by this message. Sound Financial Planning, Inc. only transacts business in states where it is properly registered or notice filed, or excluded or exempted from registration requirements. Follow-up and individualized responses that involve either the effecting or attempting to effect transactions in securities or the rendering of personalized investment advice for compensation, as the case may be, will not be made absent compliance with state investment adviser and investment adviser representative registration requirements, or an applicable exemption or exclusion. This information should not be construed as investment advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. WE WOULD LIKE TO CREDIT THIS ARTICLE'S CONTENT TO BOB VERES.

Friday, August 21, 2015

DEVALUATION PANIC

Investors across the globe were sent into a panic recently when the Chinese Central Bank devaluated the nation's currency, the yuan. The U.S. market lost more than 1% of its total value, oil prices fell and global shares plummeted on news that China decided to make its currency two percent cheaper than it was before.
 
You actually read that right. Headlines raised the prospect of a global currency war, and there were hints in the press that nations might resort to trade barriers, which would slow down global trade in all directions. If you're following the story, you probably didn't read that the Chinese yuan, even after the devaluation, was actually more valuable against global currencies than it was a year ago in trade-weighted terms. Nor that China actually intervened in the global markets to make sure the devaluation didn't go any further in open market trading.
 
The background for the devaluation is China's slowing economic growth and its recent stock market volatility. The country is on track for a 7% growth rate this year-three times the U.S. rate, but sluggish by recent Chinese standards, and quite possibly unacceptable to the country's leaders. You probably already know that the Chinese stock market climbed to impossibly high levels earlier this year and then fell just as far in a matter of weeks. The Chinese government marched into the chaos with a heavy hand, outlawing short sales, banishing hedge funds to the sidelines, suspending margin calls and even buying stocks directly in an effort to put a floor on prices. The theory was that the devaluation was part of this intervention, since it would make exports cheaper and boost sales, raising profit margins of those companies whose stocks were recently free-falling.
 
A more nuanced view of the situation is that the recent depreciation is a small step to keep the yuan's value in line with those of its peers, not a dramatic shift in exchange-rate policy or a part of the Great Shanghai Market Panic. China's percentage of world exports has been steadily growing for this entire century, without any need to add the stimulus of a weaker currency.
 
A scarier scenario, which nobody seems to be talking about, is that China's endgame goal is to make the yuan the reserve currency for global trade-replacing the U.S. dollar. China is already lobbying to join the list of reserve currencies recognized by the International Monetary Fund. The new exchange rate is more in line with basic economic fundamentals, strengthening the argument that the yuan is not under the total control of an interventionist central government. But so long as China imposes strict limits on the amount of its currency that can flow into and out of the country, and attempting to manipulate its own stock market, this will be a difficult argument to make.
Sources:

http://www.economist.com/news/finance-and-economics/21661018-cheaper-yuan-and-americas-looming-rate-rise-rattle-world-economy-yuan-thing?fsrc=scn/tw/te/pe/ed/yuanthingafteranother
 
http://www.bloombergview.com/quicktake/chinas-managed-markets
 
http://finance.yahoo.com/news/global-markets-china-devaluation-hits-165238168.html
 
http://www.bloomberg.com/news/articles/2015-08-13/china-citigroup-agree-there-s-no-need-for-big-yuan-devaluation
Sincerely,
Bill Morrissey, CFP® and Tammy Prouty, CFP®
Sound Financial Planning, Inc.

Primary Office
425 Commercial St., Ste 203
Mount Vernon, WA 98273
Phone: (360) 336-6527

Secondary Office
650 Mullis St., Ste 101
Friday Harbor, WA 98250
(360) 378-3022


PLEASE READ THIS WARNING: All e-mail sent to or from this address will be received or otherwise recorded by the Sound Financial Planning, Inc. corporate e-mail system and is subject to archival, monitoring and/or review, by and/or disclosure to, someone other than the recipient. This message is intended only for the use of the person(s) ("intended recipient") to whom it is addressed. It may contain information that is privileged and confidential. If you are not the intended recipient, please contact the sender as soon as possible and delete the message without reading it or making a copy. Any dissemination, distribution, copying, or other use of this message or any of its content by any person other than the intended recipient is strictly prohibited. Sound Financial Planning, Inc. has taken precautions to screen this message for viruses, but we cannot guarantee that it is virus free nor are we responsible for any damage that may be caused by this message. Sound Financial Planning, Inc. only transacts business in states where it is properly registered or notice filed, or excluded or exempted from registration requirements. Follow-up and individualized responses that involve either the effecting or attempting to effect transactions in securities or the rendering of personalized investment advice for compensation, as the case may be, will not be made absent compliance with state investment adviser and investment adviser representative registration requirements, or an applicable exemption or exclusion. This information should not be construed as investment advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. WE WOULD LIKE TO CREDIT THIS ARTICLE'S CONTENT TO BOB VERES.

Tuesday, August 11, 2015

TEACHING YOUR HEIRS TO VALUE YOUR WEALTH

Some millionaires are reluctant to talk to their kids about family wealth.Perhaps they are afraid what their heirs may do with it.
 
In a 2015 CNBC Millionaire Survey, 44% of families having at least $1 million in investable assets said that they had not yet told their children about their future inheritance. Another 27% said they had refrained from mentioning it until their children were 30 or older.1
   
It can be awkward to talk about such matters, but these parents likely postponed discussing this topic for another reason: they wanted their kids to grow up with a strong work ethic instead of a "wealth ethic."
    
If a child comes from money and grows up knowing he or she can expect a sizable inheritance, that child may look at family wealth like water from a free-flowing spigot with no drought in sight. It may be relied upon if nothing works out; it may be tapped to further whims born of boredom. The perception that family wealth is a fallback rather than a responsibility can contribute to the erosion of family assets. Factor in a parental reluctance to say "no" often enough, throw in an addiction or a penchant for racking up debt, and the stage is set for wealth to dissipate.
 
How might a family plan to prevent this? It starts with values. From those values, goals, and purpose may be defined.
 
Create a family mission statement. To truly share in the commitment to sustaining family wealth, you and your heirs can create a family mission statement, preferably with the input or guidance of a financial services professional or estate planning attorney. Introducing the idea of a mission statement to the next generation may seem pretentious, but it is actually a good way to encourage heirs to think about the value of the wealth their family has amassed, and their role in its destiny. 
 
This mission statement can be as brief or as extensive as you wish. It should articulate certain shared viewpoints. What values matter most to your family? What is the purpose of your family's wealth? How do you and your heirs envision the next decade or the next generation of the family business? What would you and your heirs like to accomplish, either together or individually? How do you want to be remembered? These questions (and others) may seem philosophical rather than financial, but they can actually drive the decisions made to sustain and enhance family wealth.
 
Feel no shame in exerting some control. A significant percentage of families seek to define a purpose for transferred wealth. In CNBC's survey, 32% of parents aged 55 or younger said they were going to specify what their heirs could use their inheritances for, and that was also true for 15% of parents aged 55-69 and 9% of parents aged 70 or older.1
 
You may want to distribute inherited wealth in phases. A trust provides a great mechanism to do so; a certain percentage of trust principal can be conveyed at age X and then the rest of it Y years later, as carefully stated in the trust language.
 
This is a way to avoid a classic mistake: giving your heirs too much money at once. In fact, a 2015 Merrill Lynch Private Banking & Investment Group report notes that 46% of high net worth parents share that very concern.2
   
Just how much is too much? Answers vary per family, of course. In the aforementioned Merrill Lynch survey, 46% of families said that they wanted to avoid handing down the kind of money that would dissuade their heirs from realizing their full potential in their lives and careers.2
 
By involving your kids in the discussion of where the family wealth will go when you are gone, you encourage their intellectual and emotional investment in its future. Pair values, defined goals, and clear purpose with financial literacy and input from a financial or legal professional, and you will take a confident step toward making family wealth last longer. 
Sources:
 
1 - cnbc.com/2015/07/22/wealthy-parents-fret-over-inheritance-talk-with-kids.html [7/22/15]

2 - bankrate.com/finance/estate-planning/critical-questions-before-leaving-an-inheritance-1.aspx [8/6/15]
Sincerely,
Bill Morrissey, CFP® and Tammy Prouty, CFP®
Sound Financial Planning, Inc.
Primary Office
425 Commercial St., Ste 203
Mount Vernon, WA 98273
Phone: (360) 336-6527

Secondary Office
650 Mullis St., Ste 101
Friday Harbor, WA 98250
(360) 378-3022


PLEASE READ THIS WARNING: All e-mail sent to or from this address will be received or otherwise recorded by the Sound Financial Planning, Inc. corporate e-mail system and is subject to archival, monitoring and/or review, by and/or disclosure to, someone other than the recipient. This message is intended only for the use of the person(s) ("intended recipient") to whom it is addressed. It may contain information that is privileged and confidential. If you are not the intended recipient, please contact the sender as soon as possible and delete the message without reading it or making a copy. Any dissemination, distribution, copying, or other use of this message or any of its content by any person other than the intended recipient is strictly prohibited. Sound Financial Planning, Inc. has taken precautions to screen this message for viruses, but we cannot guarantee that it is virus free nor are we responsible for any damage that may be caused by this message. Sound Financial Planning, Inc. only transacts business in states where it is properly registered or notice filed, or excluded or exempted from registration requirements. Follow-up and individualized responses that involve either the effecting or attempting to effect transactions in securities or the rendering of personalized investment advice for compensation, as the case may be, will not be made absent compliance with state investment adviser and investment adviser representative registration requirements, or an applicable exemption or exclusion. This information should not be construed as investment advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. WE WOULD LIKE TO CREDIT THIS ARTICLE'S CONTENT TO MARKETING PRO INC

Tuesday, August 4, 2015

WHY DOES THE WAGE GAP BETWEEN MEN & WOMEN PERSIST?

Last year, the median weekly earnings for an American woman came to $719.Bureau of Labor Statistics data shows that the median weekly earnings for an American man were $152 higher, or 21.1% more.1

Calculated over the course of 52 weeks, that means the median yearly pay for a man in America was $45,292 in 2014. Median yearly pay for a woman: $37,388.1

The good news, relatively speaking: in the past 35 years, this gap has narrowed. In 1980, women working full-time earned only about 65% of the wages of their male counterparts.2

After all these years, why is there still such wage inequality? Two quick explanations are often put forth. One, there is still appreciable wage discrimination against women in the workforce, with mothers being perhaps most affected. Two, some women accept lower-paying jobs or leave work altogether while staying at home with their kids or taking care of ailing relatives. These factors are certainly present in wage inequality, yet so are others that get less media notice.

More women work for low pay than men. Citing BLS data, the National Women's Law Center notes that more than two-thirds of minimum-wage jobs in this country are held by women. In fact, the NWLC found in 2014 that women made up 76% of employees in the ten most common occupations with hourly wages of $10.10 or lower. Even in these low-salaried jobs, full-time working women still made an average of 10% less than their male co-workers.3,4

As the Great Recession ebbed, these entry-level jobs were an immediate source of work for many women: 35% of the net employment gain for women from 2009-13 occurred in these fields, compared to 18% of the net employment gain for men. As the number of women in these low-wage occupations markedly exceeds the number of men, this is one of the underpublicized reasons for the continuing wage gap by gender.4
 
Careers in which women predominate pay less than careers in which men predominate. As an example, more than 75% of classroom teachers in America are women (and the median pay for classroom teachers, adjusted for inflation, is essentially where it was in 1970). Only recently have initiatives emerged to encourage women to enter "STEM" career fields (careers rooted in science, technology, math and engineering), which are male-dominated and comparatively high-salaried.5

It may be argued that a teacher contributes much more to society than a software engineer, but that argument is not bolstered by the pay gap between those careers. Looking at Payscale.com, the average salary for an elementary school teacher is $40,311 while the average software engineer earns $63,080.6
   
Women do a lot of unpaid work. A mother earns no salary for raising children; a wife earns no salary for taking care of a disabled or seriously ill spouse or partner. Historically, women have left the office to perform this work to greater degree than men have. This tendency also contributes to the wage gap, as the woman involved may end up choosing lower-paying work or not work at all.
 
Wage discrimination still exists, and is partly accountable for the differential in median wages between the sexes. There is more to the story, however; the career and life choices women are encouraged or impelled to make also influence the numbers. 
Sources:

1 - bls.gov/cps/cpsaat37.htm [2/12/15]
2 - sandiegouniontribune.com/news/2015/may/09/fair-pay/ [5/9/15]
3 - nwlc.org/resource/fair-pay-women-requires-fair-minimum-wage [5/13/15]
4 - nwlc.org/resource/women-are-76-percent-workers-10-largest-low-wage-jobs-and-suffer-10-percent-wage-gap [4/2/14]
5 - nytimes.com/2014/09/07/sunday-review/why-dont-more-men-go-into-teaching.html [9/7/14]
6 - payscale.com/salaries-by-occupation [7/30/15]
Sincerely,
Bill Morrissey, CFP® and Tammy Prouty, CFP®
Sound Financial Planning, Inc.
Primary Office
425 Commercial St., Ste 203
Mount Vernon, WA 98273
Phone: (360) 336-6527

Secondary Office
650 Mullis St., Ste 101
Friday Harbor, WA 98250
(360) 378-3022


PLEASE READ THIS WARNING: All e-mail sent to or from this address will be received or otherwise recorded by the Sound Financial Planning, Inc. corporate e-mail system and is subject to archival, monitoring and/or review, by and/or disclosure to, someone other than the recipient. This message is intended only for the use of the person(s) ("intended recipient") to whom it is addressed. It may contain information that is privileged and confidential. If you are not the intended recipient, please contact the sender as soon as possible and delete the message without reading it or making a copy. Any dissemination, distribution, copying, or other use of this message or any of its content by any person other than the intended recipient is strictly prohibited. Sound Financial Planning, Inc. has taken precautions to screen this message for viruses, but we cannot guarantee that it is virus free nor are we responsible for any damage that may be caused by this message. Sound Financial Planning, Inc. only transacts business in states where it is properly registered or notice filed, or excluded or exempted from registration requirements. Follow-up and individualized responses that involve either the effecting or attempting to effect transactions in securities or the rendering of personalized investment advice for compensation, as the case may be, will not be made absent compliance with state investment adviser and investment adviser representative registration requirements, or an applicable exemption or exclusion. This information should not be construed as investment advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. WE WOULD LIKE TO CREDIT THIS ARTICLE'S CONTENT TO MARKETING PRO INC.

Tuesday, July 28, 2015

THE DOCTOR ON YOUR WRIST

Chances are you think that medical costs are going to bankrupt America, and if we assume that Medicare and Medicaid costs will rise as they have for the past 20 years (despite the brief interlude these last three years), then there is reason for alarm. But ask yourself: how much of those costs are related to expensive diagnostic tests? How much are related to fixing major health problems after the fact, when they could have been prevented if we had only known where to look at what lifestyle changes to make?

What the bean counters are missing when they simply project ever-larger expenditures based on past experience is the enormous impact that wearable diagnostics are going to have on healthcare in general. You already know about Fitbit, which helps you get in shape by tracking the number of steps you take each day and week, and now also tracks heart rate, calories burned and stairs climbed. More recent innovations are the Sensoria smart sock, which diagnoses your running stride and can reliably identify a runner's rookie mistake of heel striking. If you've gone to a hospital to evaluate your endurance, well, you could have used the PerformTech heart-rate monitor, which calculates your endurance simply from five minutes on a stair-stepper.

Not getting enough sleep? Or the right kind of sleep? The Withing's Aura bed pad will diagnose the quality of your REM cycle. An app by Sleeprate will tell you when you have restless cycles. And if you're one of those people who has trouble getting into meditation, you might try the Muse headband, which contains an EEG device that measures brainwaves, and helps coach you into a state of meditative peace. It also tracks your meditative progress over time.

Wouldn't it be nice if all of these devices were included in the same device? As you read this, ten different companies from around the world are competing for an X Prize that will be given to the first "tricorder," the device from Star Trek that was used to diagnose the damage to crew members after a rough battle with the Klingons. The winner of the Tricorder X Prize will be able to monitor your body temperature, oxygen levels and heart rate, tell if you're anemic, check your blood pressure and perform a constant EEG. It will diagnose common maladies like stroke and less common ones, like tuberculosis.

Meanwhile, if you saw the episodes of Jeopardy where a computer named Watson cleaned up the board, well, you saw the next major diagnostic engine. At this moment, Watson is busy absorbing all the medical literature, and is helping real doctors make proper diagnoses and offer remedies. IBM, the maker of Watson, expects to put the program in the Cloud, where it will be accessible to, among other things, mobile devices.

The combination of the next generation of wearable diagnostics uploading data to Watson for instant analysis will allow all of us to have our health monitored constantly in real time-by affordable devices that are as sensitive as the expensive hospital equipment that currently hits the global healthcare budget so hard. When you begin to have a problem, the wearable device will schedule a medical exam. If you start to experience the early stages of a heart attack or stroke, the ambulance will arrive at your door-before you realize you have a problem. The treatments will be much less expensive, because the problems will be caught in the very early stages.

How many billions of dollars will this save? The bean counters who draw the alarming graphs haven't even started to realize that they're living in the middle of a health care revolution. But now you do.
Sources:

http://readwrite.com/2013/08/29/readwritebody-scanadu-scout-tricorder

http://readwrite.com/2015/03/19/tricorder-x-prize-home-diagnostics

http://techcrunch.com/2014/01/11/ive-seen-the-future-of-health-tech-and-its-going-to-improve-your-life-in-2014/
Sincerely,
Bill Morrissey, CFP® and Tammy Prouty, CFP®
Sound Financial Planning, Inc.
Primary Office
425 Commercial St., Ste 203
Mount Vernon, WA 98273
Phone: (360) 336-6527

Secondary Office
650 Mullis St., Ste 101
Friday Harbor, WA 98250
(360) 378-3022


PLEASE READ THIS WARNING: All e-mail sent to or from this address will be received or otherwise recorded by the Sound Financial Planning, Inc. corporate e-mail system and is subject to archival, monitoring and/or review, by and/or disclosure to, someone other than the recipient. This message is intended only for the use of the person(s) ("intended recipient") to whom it is addressed. It may contain information that is privileged and confidential. If you are not the intended recipient, please contact the sender as soon as possible and delete the message without reading it or making a copy. Any dissemination, distribution, copying, or other use of this message or any of its content by any person other than the intended recipient is strictly prohibited. Sound Financial Planning, Inc. has taken precautions to screen this message for viruses, but we cannot guarantee that it is virus free nor are we responsible for any damage that may be caused by this message. Sound Financial Planning, Inc. only transacts business in states where it is properly registered or notice filed, or excluded or exempted from registration requirements. Follow-up and individualized responses that involve either the effecting or attempting to effect transactions in securities or the rendering of personalized investment advice for compensation, as the case may be, will not be made absent compliance with state investment adviser and investment adviser representative registration requirements, or an applicable exemption or exclusion. This information should not be construed as investment advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. WE WOULD LIKE TO CREDIT THIS ARTICLE'S CONTENT TO BOB VERES.

Monday, July 20, 2015

PEACE IN OUR TIME

What was the most peaceful era of human history? The 200-year-long Pax Romana in the Roman Empire? The peaceful period in Asia following the Mongol conquests? The Ming dynasty in China?
You probably haven't considered our present times, since we're constantly reading about the spread of ISIS, incursions by the Taliban in Afghanistan, and what appears to be an escalating conquest of Ukraine by neighboring Russia. Every day you read about the threat of terrorist attacks.
But evolutionary psychologist Steven Pinker, author of "The Better Angels of Our Nature," has compiled statistics which make a compelling case that fewer people are dying as a result of violence in today's world than at any time in history. The wars we hear about are relatively contained-when you add up the populations of Syria, Iraq, Afghanistan and eastern Ukraine (and not every citizen in those nations is directly impacted by war), it comes to just 1.37% of the world population. And the peaceful zones in between are much greater in this century now that we've given up the habit of waging world wars.
Pinker offers some interesting perspectives; for instance, deaths in warfare among certain aboriginal tribes in New Guinea and Fiji were higher than in Germany throughout two world wars. But his definition of peace is broader than simply fewer armed conflicts; he also takes into account murder rates and civilian violence in countries around the world. The murder rate during the gold rush in California was among the highest in recorded history; today, California is hardly a bastion of violence. In Europe, torture and public executions were common, and it was not uncommon to see severed heads resting on spikes as you entered a city. Today this kind of thing is rare globally and virtually nonexistent in the Western states. Slavery has been abolished, and the laws have had a significant dampening effect on the once-common instances of rape, infanticide, lynch mobs and cruelty to animals.
The conclusion of the book is that not only are we living in the most peaceful time in world history, but that this may be the least-appreciated development in the history of our species.
Which countries are the most and least peaceful? For that information, you turn to the Global Peace Index, which was created by the Economist magazine from data compiled by the Institute for Economics and Peace. The methodology is detailed; each country is ranked based on its relations with neighboring countries (being at war earns a low score; the U.S./Canadian border earns the highest); level of internal conflict (countries embroiled in civil wars receive low scores); political instability; terrorist activity; number of homicides per 100,000 people; level of violent crime; number of jailed persons per 100,000 citizens; military expenditure as a percentage of GDP; and citizen access to small arms and light weapons.
In general, the Institute found that peace tends to be found in countries with higher income, schooling, high levels of government transparency and low corruptions. You also find greater measures of peace in stable countries that are part of regional blocks (think: Eurozone).
The most recent ranking, completed in 2014, lists Iceland, New Zealand, Switzerland, Finland, Austria, Norway, Belgium, Japan, Canada and Denmark as the top ten most peaceful countries, and their overall rankings are pretty similar. To find the United States, you have to go all the way down to number 101, where the high homicide rate, highest per-capita number of people in jails, huge military expenditures and high number of external conflicts that the military is engaged in all pull the ranking down. Not surprisingly, the bottom of the scale includes Iraq, Afghanistan, the Democratic Republic of the Congo, Syria, Sudan and Somalia-the most well-publicized war zones.
Sources:

http://history.howstuffworks.com/historical-events/most-peaceful-time-in-history3.htm

http://www.theguardian.com/science/2012/nov/19/better-angels-nature-steven-pinker-review

http://en.wikipedia.org/wiki/Global_Peace_Index
Sincerely,
Bill Morrissey, CFP® and Tammy Prouty, CFP®
Sound Financial Planning, Inc.
Primary Office
425 Commercial St., Ste 203
Mount Vernon, WA 98273
Phone: (360) 336-6527

Secondary Office
650 Mullis St., Ste 101
Friday Harbor, WA 98250
(360) 378-3022



PLEASE READ THIS WARNING: All e-mail sent to or from this address will be received or otherwise recorded by the Sound Financial Planning, Inc. corporate e-mail system and is subject to archival, monitoring and/or review, by and/or disclosure to, someone other than the recipient. This message is intended only for the use of the person(s) ("intended recipient") to whom it is addressed. It may contain information that is privileged and confidential. If you are not the intended recipient, please contact the sender as soon as possible and delete the message without reading it or making a copy. Any dissemination, distribution, copying, or other use of this message or any of its content by any person other than the intended recipient is strictly prohibited. Sound Financial Planning, Inc. has taken precautions to screen this message for viruses, but we cannot guarantee that it is virus free nor are we responsible for any damage that may be caused by this message. Sound Financial Planning, Inc. only transacts business in states where it is properly registered or notice filed, or excluded or exempted from registration requirements. Follow-up and individualized responses that involve either the effecting or attempting to effect transactions in securities or the rendering of personalized investment advice for compensation, as the case may be, will not be made absent compliance with state investment adviser and investment adviser representative registration requirements, or an applicable exemption or exclusion. This information should not be construed as investment advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. WE WOULD LIKE TO CREDIT THIS ARTICLE'S CONTENT TO BOB VERES.

Tuesday, July 14, 2015

THE FIRST QUESTION TO ASK EVERYONE

The First Question to Ask Everyone

Suppose you truly want to connect with other people. What's your best strategy?

Most of us start off with questions like: what do you do for a living? And: where did you grow up? We ask for facts and then try to extrapolate a living person around the data that we gather. But that doesn't tell us who that other person is, and it represents polite conversation rather than a genuine attempt to connect.  Research shows that connecting with people is far more valuable than gathering data on them. It's also more interesting.

A better strategy, proposed by New Zealander Bernadette Logue, is to see everybody you encounter as a story, and to ask: What's your story? She points out that all stories are unique; your upbringing, challenges, your hard-learned lessons, experiences, achievements and gifts all communicate far more of relevance than your job description.

When you ask for someone's story, you learn what they've learned, and you have an opportunity to connect on a deeper, more profound level. A win-win. Logue says that each person is like a new blockbuster movie, and the tickets are free. She calls this "The question you should ask everybody you meet."
Source:
http://www.marcandangel.com/2013/08/13/one-question-you-should-ask-everyone-you-meet/
Sincerely,
Bill Morrissey, CFP® and Tammy Prouty, CFP®
Sound Financial Planning, Inc.
Primary Office
425 Commercial St., Ste 203
Mount Vernon, WA 98273
Phone: (360) 336-6527

Secondary Office
650 Mullis St., Ste 101
Friday Harbor, WA 98250
(360) 378-3022


PLEASE READ THIS WARNING: All e-mail sent to or from this address will be received or otherwise recorded by the Sound Financial Planning, Inc. corporate e-mail system and is subject to archival, monitoring and/or review, by and/or disclosure to, someone other than the recipient. This message is intended only for the use of the person(s) ("intended recipient") to whom it is addressed. It may contain information that is privileged and confidential. If you are not the intended recipient, please contact the sender as soon as possible and delete the message without reading it or making a copy. Any dissemination, distribution, copying, or other use of this message or any of its content by any person other than the intended recipient is strictly prohibited. Sound Financial Planning, Inc. has taken precautions to screen this message for viruses, but we cannot guarantee that it is virus free nor are we responsible for any damage that may be caused by this message. Sound Financial Planning, Inc. only transacts business in states where it is properly registered or notice filed, or excluded or exempted from registration requirements. Follow-up and individualized responses that involve either the effecting or attempting to effect transactions in securities or the rendering of personalized investment advice for compensation, as the case may be, will not be made absent compliance with state investment adviser and investment adviser representative registration requirements, or an applicable exemption or exclusion. This information should not be construed as investment advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. WE WOULD LIKE TO CREDIT THIS ARTICLE'S CONTENT TO BOB VERES.

Wednesday, July 8, 2015

THE BEARS INVADE SHANGHAI

With all eyes on Greece, a bigger and potentially more disturbing market disruption is taking place-in a much larger economy.  As you read this, the Chinese stock market is experiencing the kind of free-fall not seen since the 2008 drop in global markets.  Some are comparing it to the 1929 crash in U.S. stocks.

The fall has been fairly dramatic, even if it has not yet taken share prices on the Shanghai Composite Index where they were previous to a perilous bull run that began in February.  The fall has apparently alarmed the Chinese government, which has authorized extraordinary interventions.  Among them: twenty one Chinese brokerage firms have agreed to invest the equivalent of $19 billion in stocks, in an effort to create more demand.  The stock exchanges suspended initial public offerings so as not to put any more shares on the market.  The Chinese central bank has cut its benchmark lending and interest rates.  And the government itself, through its pension system, has now been authorized to play the market.

Perhaps the most ominous intervention, however, came when China's market regulator decided that brokers should not force people who have bought stocks on margin to engage in forced selling in order to cover their debts.  Instead, the brokers were told to extend additional margin loans that would be collateralized by investors'homes.  If the market continues to plunge, observers wonder, how will investors (or banks) liquidate those houses?  Is it wise to spread the risk from the stock sector to real estate valuations?

The brokerage pledge to buy shares is reminiscent of 1929 Wall Street, when the great banking houses of J.P. Morgan and Guarantee Trust Company committed their resources to propping up the U.S. stock market.  That experiment was not a notable success; the Dow Jones Industrial Average fell 13% the following Monday and dropped another 34% over the next three weeks. The Chinese intervention fund, led by Citic Securities Co. and Guotai Junan Securities Co., faces a similar uphill battle; the war chest represents only one-fifth of the Chinese market's daily trading volume.

So far, Chinese investors have lost $2.7 trillion of stock value-the equivalent of six times Greece's entire foreign debt.  Much of the pain has been borne by individuals, who own four-fifths of China's stocks, far more than in Western markets where institutional investors are the dominant owners.  Many of these common folk borrowed money to buy their shares, contributing to a nine-fold increase in margin lending by brokerage firms over the past two years.  This dramatic rise in speculative investing has echoes both in the run up to 1929 and 2008, two periods when reckless betters (individuals in the earlier era, Wall Street in the latter) were able to borrow 90% of the money they "invested."

Moreover, the margin loans carry annual interest rates as high as 20%.  Total margin debt, when you add up the brokerage firms, banks and informal loans, could amount to as much as $1 trillion.  As share prices fall, investors would be left with far less in stock value than the high-interest loans they owe-making repayment problematic, potentially putting $1 trillion worth of stress on the Chinese banking system.

It gets worse.  Many smaller Chinese companies have financed their expansion by taking out loans against the value of their shares.  The companies have had to post additional collateral as the share value dropped down to the outstanding balance on the loan.  Additional market losses could put these companies in real danger of default, adding to the stress.

Nobody knows if the free-fall will continue to feed on itself, or if the government will somehow manage to slow the descent.  But highly-leveraged investing on a mass scale seldom ends well, as most of us remember from the subprime crisis when we had to reach into our pockets to make Wall Street whole again on its disastrous speculations.

Fortunately, none of this is likely to directly affect the portfolios of American investors, since foreigners account for only about 4% of the Chinese stock market.  But as the crisis deepens, and especially if the defaults start to mount, companies go under and the banks stop lending into the economy, you could see commodity prices fall on weaker demand, and there could be a hit to large American companies that do a lot of business in the Asian markets.  This does have the potential to drag down the pace of global growth which would weigh on demand for goods and services broadly. And it could be a long time before individual Chinese investors trust the stock market again.
Sources:

http://www.economist.com/news/business-and-finance/21657036-measures-prop-up-share-prices-appear-be-failing-bear-wrestling

http://www.bloomberg.com/news/articles/2015-07-06/timeline-china-s-efforts-to-stem-3-2-trillion-stock-rout

http://www.nytimes.com/2015/07/06/business/international/chinas-market-rout-is-a-double-threat.html?_r=0

http://www.bloombergview.com/articles/2015-07-06/china-steers-toward-a-subprime-economy
Sincerely,
Bill Morrissey, CFP® and Tammy Prouty, CFP®
Sound Financial Planning, Inc.
Primary Office
425 Commercial St., Ste 203
Mount Vernon, WA 98273
Phone: (360) 336-6527

Secondary Office
650 Mullis St., Ste 101
Friday Harbor, WA 98250
(360) 378-3022


PLEASE READ THIS WARNING: All e-mail sent to or from this address will be received or otherwise recorded by the Sound Financial Planning, Inc. corporate e-mail system and is subject to archival, monitoring and/or review, by and/or disclosure to, someone other than the recipient. This message is intended only for the use of the person(s) ("intended recipient") to whom it is addressed. It may contain information that is privileged and confidential. If you are not the intended recipient, please contact the sender as soon as possible and delete the message without reading it or making a copy. Any dissemination, distribution, copying, or other use of this message or any of its content by any person other than the intended recipient is strictly prohibited. Sound Financial Planning, Inc. has taken precautions to screen this message for viruses, but we cannot guarantee that it is virus free nor are we responsible for any damage that may be caused by this message. Sound Financial Planning, Inc. only transacts business in states where it is properly registered or notice filed, or excluded or exempted from registration requirements. Follow-up and individualized responses that involve either the effecting or attempting to effect transactions in securities or the rendering of personalized investment advice for compensation, as the case may be, will not be made absent compliance with state investment adviser and investment adviser representative registration requirements, or an applicable exemption or exclusion. This information should not be construed as investment advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. WE WOULD LIKE TO CREDIT THIS ARTICLE'S CONTENT TO BOB VERES.

Monday, July 6, 2015

THE BRINK OF GREXIT

Well, the Greek voters were asked, once again, whether they would accept additional austerity measures that were demanded by their creditors, including the European Central Bank, the International Monetary Fund and the European Commission.  And once again they voted-this time overwhelmingly (61.31% to 38.69%)-to hunker down and move the country to the brink of a Grexit from the euro currency.

Their choice may not have been hard to make.  Virtually all of the $264 billion that has been loaned to the Greek government have actually been paid to the European banks who unwisely loaded up on Greek debt before 2009-and the loans and extensions, to them through Greece, has kept the European banking system solvent during the crisis.  Virtually none of that money has gone back into the ailing Greek economy.

Over the past three years, the Greek government, following many of the demanded austerity measures, has actually reached the point of budget surplus, aside, of course, from the debt repayments.  The cost: a skyrocketing unemployment rate that has reached 25.6%, including 60% of the nation's young workers, and a steep recession which economists seem to agree would only get steeper if the country accepts the austerity demands.  The Greek economy has shrunk by 25% over the last five years.

But the hardship continues.  Anticipating a shift from euros to drachma, Greek citizens have staged the mother of all bank runs, trying to get as many euros out of the system as they could before they were exchanged for lesser-value drachmas.  The government limited the amount of their own money that citizens could withdraw to approximately $67 a day, and has now shut down the Greek banking system at least through end of day Tuesday.   Reopening the banks could be problematic, since they don't hold nearly as many euros as depositors have put into them.

Some are betting that the European Central Bank will provide guarantees and financial support to keep the banks from collapsing and taking the Greek economy down with them.  But you can expect Germany to push back hard on this idea.

Will Greece leave the Eurozone?  Nobody knows, but the vote suggests that the citizens of Greece have had enough of European (read: German) control over their economy and political decisions; indeed, some observers saw the extremely hard line at the negotiating table as a ploy to destroy Greek's ruling Syriza party by forcing Greek voters to abandon it.  There are sizable numbers of people in other European countries who feel the same way about losing control over their own affairs, who are closely watching how the European Union responds.

The discussions will be tricky.  If the European Union offers further concessions, then you can expect Spain (unemployment rate: 23.1%) to ask for less stringent austerity and some space to get its own economy moving again.  Portugal could be next.

And, of course, if Greece leaves, and begins to experience economic growth again, then those citizens in other countries could demand that their leaders also cast off the layer of oversight and control coming from Brussels.

What should you watch for?  Greece is already technically in default as of Tuesday, on $1.7 billion in payments.  At the end of July, it will owe the next payment, in the amount of just under $4 billion.  One compromise possibility is that the European Union, led by Germany, will reluctantly allow Greece to extend its payments, and also put together some kind of an aid package for the Greek economy that would help it become more able to make payments in the future.

How does this affect you?  Once again, you're going to see turmoil in the markets, and a temporary decline in the value of the euro on international markets.  You'll hear pundits and economists speculate about the "fate of the Eurozone,"and eventually, one way or another, everything will settle down again without affecting in any way the underlying value of the stocks you own.  We've all seen this crisis a few times before, and each time the predictions of some form of doom haven't come true.  This "crisis"is very real to the Greek people, but the world will go on no matter how it's resolved.
Sources:

http://finance.yahoo.com/news/greece-says-oxi-heres-happens-180726938.html

http://www.nytimes.com/interactive/2015/business/international/greece-debt-crisis-euro.html?_r=0

http://www.nytimes.com/2015/07/06/business/international/eurozone-central-bank-now-controls-destiny-of-greeces-battered-banks.html?rref=business/international&module=Ribbon&version=context®ion=Header&action=click&contentCollection=International%20Business&pgtype=Multimedia

http://www.nytimes.com/2015/07/06/business/international/eurozone-central-bank-now-controls-destiny-of-greeces-battered-banks.html?rref=business/international&module=Ribbon&version=context®ion=Header&action=click&contentCollection=International%20Business&pgtype=Multimedia
Sincerely,
Bill Morrissey, CFP® and Tammy Prouty, CFP®
Sound Financial Planning, Inc.
Primary Office
425 Commercial St., Ste 203
Mount Vernon, WA 98273
Phone: (360) 336-6527

Secondary Office
650 Mullis St., Ste 101
Friday Harbor, WA 98250
(360) 378-3022


PLEASE READ THIS WARNING: All e-mail sent to or from this address will be received or otherwise recorded by the Sound Financial Planning, Inc. corporate e-mail system and is subject to archival, monitoring and/or review, by and/or disclosure to, someone other than the recipient. This message is intended only for the use of the person(s) ("intended recipient") to whom it is addressed. It may contain information that is privileged and confidential. If you are not the intended recipient, please contact the sender as soon as possible and delete the message without reading it or making a copy. Any dissemination, distribution, copying, or other use of this message or any of its content by any person other than the intended recipient is strictly prohibited. Sound Financial Planning, Inc. has taken precautions to screen this message for viruses, but we cannot guarantee that it is virus free nor are we responsible for any damage that may be caused by this message. Sound Financial Planning, Inc. only transacts business in states where it is properly registered or notice filed, or excluded or exempted from registration requirements. Follow-up and individualized responses that involve either the effecting or attempting to effect transactions in securities or the rendering of personalized investment advice for compensation, as the case may be, will not be made absent compliance with state investment adviser and investment adviser representative registration requirements, or an applicable exemption or exclusion. This information should not be construed as investment advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. WE WOULD LIKE TO CREDIT THIS ARTICLE'S CONTENT TO BOB VERES.

Thursday, July 2, 2015

2015 7 LESSONS OF THE FOURTH OF JULY

7 Lessons From the Fourth of July
By Edward E. Klink

The American Revolution was a gambit underpinned by iconoclastic ideas, unwavering principles, and tenacious effort. This July Fourth, let the example of the founding patriots inspire you to your own success.

 "Nothing important happened today."
-Diary entry by King George III on July 4, 1776

Ah, George. Little did he know what was brewing
across the Atlantic on that fateful day.
For most of us, the Fourth of July promises the
opportunity to relax, a few days on which to do
precisely "nothing important." It's a time for sizzling
burgers on the grill, spiking volleyballs at the beach,
and shouting our approval as fireworks blast colorful
patterns in the night sky.

There's nothing wrong with taking advantage of a
well-earned day off and relaxing with family and
friends. But there are lessons to be learned from
Independence Day, great lessons that underscore
the courage and commitment upon which this
country was founded-lessons about success.

When it comes to motivation and training, you'll
often hear advice thrown about, such as "Be a
leader," "Act decisively," and "Never give up." We've
heard these ideas so often, they've become clichés
that have lost some of their meaning. So let's use
this July 4 as the perfect time to look at such advice
operating in a revolutionary context.
Here are just seven of the lessons the founding
citizens of this country can still teach us today:  
    
  
1. A Lesson in Boldness
"Gentlemen, I make the motion that these United
Colonies are, and of right ought to be, free and
independent States, that they be absolved from
all allegiance to the British Crown, and that all
political connection between them and the state of
Great Britain is, and ought to be totally dissolved."

The delegates of the Second Continental
Congress in Philadelphia were stunned by these
words from Richard Henry Lee. The war had
commenced with the battles of Lexington and
Concord the previous year, but since then events
had progressed far beyond addressing colonial
grievances. The delegates were now considering
the mind-boggling audacity of pursuing complete
independence from King George III. In the 18th
century, that was the type of talk that led right up
the creaky steps to the gallows.

But nevertheless, in full consciousness of the
risk they were taking, in the summer of 1776, 56
prominent men from throughout the 13 colonies
affixed their signatures to the Declaration of
Independence, which was adopted by the Congress
on July 4. "We must all hang together, or assuredly
we shall all hang separately," Ben Franklin famously
said. The actions of these men-all of whom had
much to lose-is the very definition of boldness.
We might ask of ourselves, "Where is our resolve,
our boldness to dream and demand change? What
do we believe in?"
  
2. A Lesson in Honor
Long before the image of Samuel Adams was pasted
onto a bottle of beer, the man himself had failed as a
brewer and dedicated himself instead to politics. A
skilled writer and pamphleteer, he was responsible
for stoking the fires of rebellion among the colonists.
The crown was well aware of Adams's growing
influence and attempted to neutralize the outspoken
patriot with the methods that tend to break most
men: intimidation and bribery.

Massachusetts Governor Thomas Gage dispatched
Colonel Fenton to personally "persuade" Adams
to cease his revolutionary activities. As you're
sipping a Sam Adams Summer Ale over the holiday,
consider this remarkable exchange, as set forth in
Think and Grow Rich, by Napoleon Hill.

Colonel Fenton: "It is the governor's advice to
you, Sir, not to incur the further displeasure of His
Majesty. Your conduct has been such as makes you
liable to penalties for which persons can be sent to
England for trial for treason. But, by changing your
political course, you will not only receive great
personal advantages, but you will make your peace
with the King."

Samuel Adams: "Then you may tell Governor Gage
that I trust I have long since made my peace with
the King of Kings. No personal consideration shall
induce me to abandon the righteous cause of my
country. And tell Governor Gage it is the advice
of Samuel Adams to him, no longer to insult the
feelings of an exasperated people."

OK, here we have Adams essentially telling the
officer, the governor, and the King himself-the most
powerful man on the planet-to take a royal hike.
How many of us have such unshakeable principles,
and the inner strength to back them up?
  
3. A Lesson in Communicating
Many of us lament the daily interruptions to
our work from e-mail, faxes, and phone calls.
We sometimes see these means of connection as
little more than roadblocks to productivity. In
the 18th century there was no Internet, and no
fax machines or cell phones, but the leaders of
the rebellion placed a high priority on staying
connected and spreading the word. ("The British
are coming, the British are coming"-does that
pithy jingle ring a bell?)

One of the keys to the revolutionaries' success
against England's might was their "mastermind
alliance." Patriots such as Ben Franklin tapped into
the power and influence of collective creativity  
by networking with other progressive-minded
thinkers. They didn't always agree on the details,
but they did help one another toward their
common goal: freedom from tyranny.

Adams organized the "committees of
correspondence" along with John Hancock and
Lee to pound the pavement and circulate news
and information throughout the colonies via
handwritten letters. The Boston Tea Party was
such an effective publicity stunt-cum-political
act that it inspired copycat events throughout the
colonies. Paul Revere and two compatriots sped
through the Massachusetts night to spread the
alarm of British invasion. Thomas Paine's pamphlet
Common Sense was widely circulated and turned
the tide of public opinion toward independence:
No more technology than a printing press to that,
but talk about an effective communication strategy.

What do we do to generate buzz and excitement
about our ideas and beliefs? How willing are we to
spread the word about the causes that we support?

4. A Lesson in Perseverance
Though independence was declared in 1776, it
would take six trying years before the dream of
freedom from English rule would be realized.
During that time Washington would lose more
battles than he'd win. His own men would border
on desertion. His most valuable general and trusted
friend, Benedict Arnold, would betray him and the
cause. And of course, thousands of lives would be
lost and untold property destroyed. There were
many opportunities to give up. Arnold gave up. But
Washington and his compatriots did not. Arnold
took the path of less resistance. Washington and
the others refused to be defeated by power and
tradition. And it was they who changed the course
of history.

How resilient are we in the face of obstacles? How
do we deal with setbacks and hardship?

5. A Lesson in Sacrifice
Beyond the soldiers facing death on the battlefield,
many other Americans helped bring the dream of
July 4th to fruition, people who toiled behind the
scenes, such as Abigail Adams.

While her husband, John, traveled and labored to
build the fledgling state (as a circuit judge, delegate
to the Continental Congress, envoy abroad, and
elected officer under the Constitution), Mrs.
Adams, like women throughout the colonies,
oversaw the daily workings of the family farm,
managed the finances, and raised and educated
five children (including the future president John
Quincy Adams).

Like most women of her time, Mrs. Adams had
no formal schooling, so she educated herself. She
became a prolific reader and letter writer, leaving
behind a correspondence of some 2,000 letters that
give us a window into how she viewed politics
and society, her contributions to the war effort-
and her station in life.

On the eve of independence, Mrs. Adams wrote to
her husband: "I long to hear that you have declared
an independency. And, by the way, in the new code
of laws which I suppose it will be necessary for you
to make, I desire you would remember the ladies
and be more generous and favorable to them than
your ancestors."

How do we balance work, civic responsibilities,
and family life? How do we redress the accepted
infringements of liberty still present in our time?

6. A Lesson in Professionalism
While Thomas Jefferson has received the lion's
share of accolades for the Declaration, John
Adams also served on the writing committee and
was instrumental in bringing the Declaration
about. Jefferson called Adams "the Colossus
of that Congress-the great pillar of support to
the Declaration of Independence, and its ablest
advocate and champion on the floor of the House.
"After the war was won, political differences
caused these patriots-in-arms to become
adversaries for many years.

But finally Jefferson wrote a letter to Adams, and
the two renewed a friendship and correspondence
that lasted for the rest of their lives. Strangely
enough, Jefferson and Adams both died on July
4. On July 3, 1826, Jefferson lay on his deathbed.
Perhaps realizing the significance of passing on
the 50th anniversary of his magnum opus, he
uttered his last words to the attendant "This is the
Fourth?" To comfort him, the man replied that it
was, whereupon Jefferson smiled and fell into a
sleep from which he would never awaken.

Adams had resolved to live until the 50th
anniversary of the Declaration; when his servant
asked him that morning if he knew the date, the
90-year-old said, "Oh, yes, it is the glorious fourth
of July. God bless it. God bless you all." Adams
would die later that afternoon, with the final
words "Jefferson still survives." He didn't know
that Jefferson had died just a few hours earlier at
Monticello.

How will each of us greet our last day? With the
regret of unfinished business and unresolved
conflict? Or with the pride of a life well led?

7. A Lesson in Legacy
One amazing aspect of the Declaration of
Independence is that Jefferson's words capture an
idea and a spirit that predate them.

"But what do we mean by the American
Revolution?" asked John Adams. "Do we mean the
American war? The Revolution was effected before
the war commenced. The Revolution was in the
minds and hearts of the people."

True, the notion of freedom lived in the hearts and
minds of the colonists for a long time before it was
finally committed to paper. But once written down,
once codified in words, the idea gained clarity-
and strength. Once written down, this touchstone
of the democratic ideal could harness the power of
the will of the people to be free.

Building on Thomas Paine's Common Sense, the
33-year-old Jefferson drafted a document that
became a powerful call to action, a blueprint
that would not only inspire but support the hard
work to come. He penned the ultimate mission
statement of the country: "We hold these truths to
be self-evident, that all men are created equal, that
they are endowed by their Creator with certain
unalienable Rights, that among these are Life,
Liberty and the pursuit of Happiness."

Do we know what we are working toward in life?
Do we know what legacy our work will leave for
those generations that follow us? Do we have our
own personal mission statement?