20 PACIFIC BUSINESS NEWS | pacificbusinessnews.com
NABCAP: 2013 GUIDE TO BUILDING WEALTH
We are a full service accounting firm providing comprehensive services in auditing, accounting, bookkeeping, tax preparation and James D. Jennings consulting services to CPA, President a diversified group of clients of all sizes. The firm has been under James’ sole leadership since 2002 and currently employs six employees, of which two are CPAs and one is a CFP.
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WWW. J E N N I N G S C PA .C OM Phone 942-8813 Fax 943-0572 Email james@jenningscpa.com Jennings Financial Planning, Inc. is a registered investment advisor in the State of Hawaii. “Fee-Only” Wealth Management, therefore no commission-related conflicts of interest. MON ICA Y. JENNING S 792-0088 | monica@jenningsfp.com | www.jenningsfp.com
JULY 26, 2013
‘Bubble’ scenario stays alive, fueled by global public debt U.S. looks attractive to investors compared to most other countries ublic debt is the sum of outstanding obligations held by a government on behalf of its citizens. As with any debt, public debt is backed by the ability of the borrower (the government) to pay back its obligations and any interest owed to lenders on a timely basis. Recent discussions on how to cut U.S. debt obligations have led to heated debates, increased taxes and mandatory spending cuts prompted by sequestration. While economists and politicians are at odds as to the effects of public leverage domestically, the levels of global public debt are astronomical and continue to provide fuel for the ongoing “bubble” scenario witnessed in investments and asset classes of all types. U.S. federal debt obligations are currently capped at $16.4 trillion. Foreign central banks hold approximately 47 percent of the U.S. public debt and China is the single largest holder of our obligations, which is largely attributable to our trade imbalance with China. Some of these central banks replaced some of their U.S. dollar-denominated reserve assets with International Monetary Fund
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gold holdings. This move came at a time of global economic growth — whereby commodity assets showed strong growth tendencies — helping to fuel the KALEIALOHA recent gold bubble. CADINHA-PUAA Investors who anticipated the gold run-up WEALTHand bought early did MANAGEMENT fairly well. Those STRATEGIES who held gold during the recent bubble “pop” experienced a dramatic correction and many incurred losses. The subprime mortgage crisis that plagued our financial system was a direct result of excess liquidity, aggressive bank lending and government-induced tax incentives. Housing and real estate prices increased dramatically as a result of easy money policies. The net worth of U.S. households grew to 6.64 times GDP in 2006 at the high of the housing market and dropped to a low of 3.55 times GDP in 2009, after the housing bubble popped. Trillions of dollars of net worth were lost and many losses from this asset bubble have yet to be recovered. CONTINUED ON PAGE 21
CONGRATULATIONS OAHU
We’re proud to recognize these residential loan officers as our top producers for 2nd Quarter 2013 and members of our President’s Club.
Carolyn Johiro
Pom Luxton
Swee Wah
Paul Santos
HAWAII
Paul Hirano MAUI
Susan Chikazawa
Eric Miyajima
Robin Wagstaff
Betty Yada
Whether you’re a first-time homebuyer, buying the perfect lot to build the home of your dreams, or purchasing a second home or investment property, American Home Loans can help. Call and speak to these individuals or any of our more than 30 experienced loan officers.
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