The debt ceiling ... the U.S. Loses its triple A credit rating ... Earthquakes on the East Coast  is the world coming to an end? Probably ... (not) but with all these recent anomalies it certainly feels like we are in the Twilight Zone. It has been almost 3 years since the Fed cut its key rate to almost zero. August 9th, the central bank said rates are likely to remain there until at least mid 2013. Even though that doesn’t bode well for the stock market’s prognosis in the future, there are some pros and cons.

The benefits may not flow so easily. Consumers are showing few signs of wanting to borrow, bank and insurance companies profits are most likely going to suffer and with the stock market sliding, pensions and 401ks face years of low returns. For consumers, low rates mean cheap loans for everything from a new home to a new car. For the many baby boomers nearing the end of their working lives, low rates also deliver meager returns on fixed income investments. With the stock market well below it’s 2007 highs, that is going to be particularly painful.

Finance: What do low interest rates mean for you?

Additionally, it is very unlikely that additional interest rate easing will do much to stimulate employment or GDP (Gross Domestic Product). We don’t just have a spending problem in Washington, we more importantly have a revenue problem. Since the slashing of the tax burden of the rich in the Reagan years and the Bush years, the tax revenue has diminished insanely.  Whose to pick up the lack of tax revenue?  What’s left of the middle class? How is that possible when they are the subject of double digit unemployment rates? The country’s leadership should stand up and push a new tax reform requiring the rich and corporations to pay their fair share of taxes and eradicate these idiotic jet tax credits, oil company subsidies and corporate tax credits for “headquartering” outside of the U.S. How can a financial house ever be in order if you consistently spend more than you ever bring in?

What do you think should be done?

For information on how to manage your finances during these hard economic times, give HLM Financial Group a call at 404-836-1120.  For more information on HLM Financial Group visit


Mercedes M Pasqualetti is a General Manager with HLM Financial Group and can be reached at