24 January 2019 FT — Articles to Read

24 January 2018


Question: According to MSN: Money, what are five (5) ways to avoid paying taxes on Social Security benefits?


China certain of ‘sustainable growth’, says economy chief – Pg. 1

–        …insisted China’s growth rate in 2018 of 6.6%, which slowed to its lowest level in almost three decades at the end of last year, was still “a pretty significant number, not low at all”

–        Japanese exports to Asia fell 6.9%, while those to China, Japan’s largest market in the region, shrank 7% and shipments to Hong Kong and South Korea were down 17.3% and 11.6%, respectively


ECB ponders delicate balancing act in face of weaker growth – Pg. 2

–        Reining in QE was the ECB’s way of taking the road to normalizing its monetary policy.  But political uncertainty is dragging on Eurozone investment and slowing exports

–        Economic growth fell to its lowest level in more than four years in the third quarter.  Some national central bank governors are concerned that trade tensions could escalate, drawing in German car manufacturers and leaving the export-dependent region vulnerable to a recession

–        While Germany, the eurozone’s largest economy, is thought to have avoided a second consecutive quarter of negative growth in the last three months of 2018, Italy is likely to have entered such a technical recession…

–        The IMF has become the latest body to downgrade its forecast for Eurozone growth, saying the region would expand by 1.6% this year, down from 1.9% in October

–        In some national central banks there is also concern that core inflation – a measure that strips out changes in prices for oil and food – is, after years of economic expansion, still showing little signs of picking up.  Rising price pressures would be a good sign that the economy remains strong, but core inflation is expected to be just 1.3%….the ECB targets headline inflation of just under 2%


Big Four auditors warned on rules – Pg. 11

–        Britain’s accounting watchdog has warned the biggest audit firms against attempting to subvert European rules that require large companies to switch auditors every 20 years

–        Pressure is building on big US banks, including Goldman Sachs, JPMorgan Chase and BofA, to appoint new auditors for their European operations or change auditors altogether


Sovereign budgets face hit from rising interest rates – Pg. 19

–        Governments around the world face a deteriorating financial position as rising interest rates combined with high levels of indebtedness put a strain on their budgets…

–        The volume of outstanding global government debt has nearly doubled since the financial crisis….hitting $66tn in 2018 – almost 80% of global GDP

–        But the credit quality of this debt has undergone a “steady deterioration”, …Just 11 sovereigns hold the highest possible credit rating, AAA, while the proportion of outstanding government debt that is junk-rated is hovering around its highest level for 15 years at 7% of total

–        The average raring in developed markets is below AA, down a grade since 2011.  In emerging economies, the average rating is at its lowest since 2005, sitting just below BB+

–        Earlier this week, the IMF downgraded its 2019 forecast 0.2% to 3.5%, saying trade wars and financial market volatility were undermining the investment climate

–        Because much of the debt raised in the aftermath of the financial crisis is set to mature in the coming years, developed nations will have to refinance 40% of their total debt stock by 2021…


Answer: (1) Retire to a tax-friendly state; (2) Give your RMD to charity; (3) Withdraw money from tax-free roth; (4) Buy a QLAC; (5) Do not overload on income investments