April 1, 2011

I have just finished reading Greg Easterbrook’s “Sonic Boom”.  It is very relevant to all the changes today. Easterbrook discusses the rapid and unpredictable events that will be going on in the world. These changes, in general, will bring about positive changes for the United States and raise the living standard of everyone around the world. The speed of these changes will create an uneasiness of living caused by a world that is completely unpredictable. This can be exemplified by what is going on in the Middle East in just three months. We have seen significant changes in Egypt and Libya and it appears that the democratic freedom movement will continue to spread across the Middle East. The end result of this is unpredictable and unknowable. When you add the earthquake, and subsequent tsunami that hit Japan followed by the radiation leaks caused by these events, Easterbrook’s premise seems to be spot on and more relevant than ever. Hold on for the ride.


I believe the economy will continue to recover with stops and starts. The DOW index gained 6.4% in the first quarter. With the exception of the housing market all sectors of the economy are growing. The U.S. now is the best place to be investing. Looking at our overall economic situation, the one thing that is most threatening is the potential for massive inflation. The United States government, whose fiscal year ends 9/30/11, is projected to spend 3.7 trillion dollars. I cannot begin to put this in perspective, the numbers are too large. To help it is almost a doubling of the government in less than 10 years, an unprecedented expansion. This deficit and the projected amount of spending in relation to income (we are borrowing 40 cents on every dollar spent)  has the potential for inflation and the devaluation of the dollar. It is a tremendous and potentially devastating problem. Because of this one or more of three things must happen: federal spending must be reined in significantly, our taxes  must go up significantly or we must expand the economy so much that the expanded tax base and current tax rate will take care of the increase in federal spending. In reality, none of these things individually will solve the problem, therefore it will need to be a combination of one or two and most likely all three. The expansion of the economy, raising of taxes and the reduction of government spending. The potential problems of not bringing this under control quickly is devastating.

I am pleased to announce that Integra is expanding and Keith Fevurly and Bill Patton are joining the firm. Keith is a CFP, an attorney, and has two masters’ degrees: one in business and one in tax. Bill is a CFP and has a master’s degree in Management/Human Relations. Bill has over 36 years of experience in financial planning and is the Past President and Chairman of the Financial Planning Association. I am very pleased to have Bill and Keith joining the firm. They add to the depth of knowledge and experience in helping us meet your financial needs and goals.

In closing, I welcome Bill and Keith’s clients and I thank all of you for the confidence you place with us.


Willis Ashby, CFP

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