Upcoming Tax Season Provides Unique Tax Savings Opportunities through Roth IRA Conversions

/PRNewswire/ -- A change in the federal tax law, effective January 1, 2010, will permit Roth IRA conversions for taxpayers at all income levels. In the past, this option was only available to those with an adjusted gross income of $100,000 or less.

"Taxpayers may now convert part, or all of their assets from a traditional IRA into a tax free Roth IRA," says Kevin McCormack, President of Pension Parameters Financial Services.

"While many individuals and businesses are carefully scrutinizing their budgets, creating a Roth and taking advantage of a unique opportunity this year and next, and in some cases, even borrowing money to cover an investment like a conversion today, can pay off."

Details related to the change include:
-- Any portion of a traditional IRA may be converted
-- Conversion to a Roth IRA in 2010 allows for a 50-50 income tax split
for the 2011 and 2012 tax years - and the split is only applicable if
you convert in 2010
-- Though account balances have decreased in the past 18 months, the
upside is that reduced balances will lower conversion tax and yield
the potential to recover in a tax-free account
-- With tax rates at an historical low, converting to a Roth IRA in 2010
may help protect retirement assets should tax rates rise


Pension Parameters has been helping self-employed individuals and small business owners with retirement plan development and investment management since the 1970s. The company is known for its customized retirement plans and extensive follow-up with clients. McCormack states, "Unlike many pension plan managers, we do not simply collect monies and set up the plan and invest. When we see market changes, our market manager personally calls each client to recommend the right move to make."

According to McCormack, those establishing their first company retirement plans are often confused about their options such as a 401(k) plan, which allow owners and employees to make contributions through pre-tax payroll deductions, or a defined benefit plan, which may allow a business owner to make the highest possible annual contribution to his or her retirement account. Pension Parameters lately has been recommending new comparability plans, a profit-sharing option that allows certain businesses to make discretionary contributions to a qualified plan.

A Roth IRA ultimately saves tax dollars as well. Since you have already paid the tax upfront when establishing the account, the need to pay tax later is eliminated. The money you make in a Roth IRA will all be yours (or your heirs) in the end, not the government's.

Pension Parameters Financial Services is a New York and New Jersey based full service 401(k) plan provider including investment advisory and management services for the small business market. For more information regarding Pension Parameters or Roth IRA savings opportunities call: 212-675-9360 or visit them on the web at http://www.pensionfinancialservices.com/.

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Barrick shuts hedge book as world gold supply runs out

Aaron Regent, president of the Canadian gold giant, said that global output has been falling by roughly 1m ounces a year since the start of the decade. Total mine supply has dropped by 10pc as ore quality erodes, implying that the roaring bull market of the last eight years may have further to run.

"There is a strong case to be made that we are already at 'peak gold'," he told The Daily Telegraph at the RBC's annual gold conference in London.
http://www.telegraph.co.uk/finance/newsbysector/industry/mining/6546579/Barrick-shuts-hedge-book-as-world-gold-supply-runs-out.html

Statement: Alan Essig, Executive Director, on October Revenue Decline and Worsening State Budget Deficit

The dismal October revenue numbers released today underscore the depth of Georgia's fiscal crisis. For these first four months of the new fiscal year, revenues are down by 15.1 percent.

The governor's preliminary analysis of the FY 2010 revenue projection estimates a 6.2 percent revenue decline, a decrease from the nearly 4.0 percent revenue decline the governor announced in July.

Although there has been no public announcement, this analysis is contained within the Official Statement for the State of Georgia General Obligation Bond Sale dated October 26, 2009.

The revised projection means Georgia likely is facing a $1.26 billion budget shortfall. This is an additional $320 million budget shortfall on top of the $940 million budget shortfall previously announced.

In response to the projections, the governor's budget office has a contingency plan that requires state agencies to cut their budgets again, this time by $320 million dollars (an additional three percent). This comes on top of the five percent budget cuts announced in July ($800 million dollars of cuts), and the double-digit percentage cuts ($500 million) already implemented when the FY 2010 budget was passed last April.

Also problematic are more than $2 billion in non-recurring revenues in the base of the FY 2010 budget. Unless lawmakers take a more balanced approach to solving this fiscal crisis, an approach that includes revenue options, Georgia will be facing further cuts to vital public services in FY 2011 and 2012, including those to healthcare, public safety, and education.

It is time for Governor Perdue and the General Assembly to bring a balanced approach and transparency to this fiscal crisis. The General Assembly should hold public hearings and learn about the state's revenue outlook from leading economists in the state.

The General Assembly also should hear from state agency staff and citizens about the impact of the budget cuts already in place and the potential impact of planned cuts.

In order for Georgia to prosper, lawmakers must not rely soley on cuts to public services. Georgia can not cut its way to prosperity. The governor and General Assembly must look to raise revenues, as a majority of states have done, including a majority of our conservative southern neighbors. They must take a balanced, informed, and thoughtful approach to solve the state fiscal crisis, and this must include strategic revenue options.

Alan Essig
The Georgia Budget & Policy Institute

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Federal Home Loan Bank of Atlanta Boosts Housing Market with Disbursement of More Than $9.4 Million in First-time Homebuyer Funding

/PRNewswire/ -- Federal Home Loan Bank of Atlanta (FHLBank Atlanta) announced today that it has disbursed in excess of $9.4 million to more than 1,000 recipients through its 2009 First-time Homebuyer Program (FHP), providing critical and timely economic support to the housing market. For each of the past 12 years, FHLBank Atlanta has offered the matching funds through its member financial institutions for down payment and closing costs of eligible first-time homebuyers in Alabama, Florida, Georgia, Maryland, North Carolina, South Carolina, Virginia, and the District of Columbia.

Over 60 FHLBank Atlanta financial institutions accessed and closed down payment funds ranging from $1,882 to $10,000 to more than 1,000 homebuyers. Thanks to the funding, member financial institutions are able to expand their customer base, originate new mortgages, and attract new homebuyers into the market. The private funds -- derived from profits earned by the Federal Home Loan Bank of Atlanta -- serve as an attractive tool to bring more homebuyers into the market and also serve as a valuable form of equity that they can benefit from in the future.

Since the program's inception in 1997, FHLBank Atlanta has allocated more than $50 million to first-time homebuyers, which has allowed more than 9,000 families and individuals to purchase a home. FHLBank Atlanta estimates that for every $1 of FHP funding awarded, $17 is generated in new mortgage business for its member banks.

"FHP is stimulating home sales and mortgage lending in communities at a time when the housing market and the overall economy need this type of economic support," said Arthur Fleming, first vice president and director of Community Investment Services, FHLBank Atlanta. "Relationships created between first-time homebuyers and FHLBank Atlanta lenders are significant and can provide a strong base for recovery of the residential housing sector."

The 2009 FHP offering cycle opened April 1, 2009, and continued until the funds were fully disbursed to member institutions. Funds were provided on a first-come, first-served basis. Individual participants receiving FHP funds were required to complete a credit counseling program that includes educational training on the home-buying process including courses on household budgeting, mortgage financing, lending laws, and debt management.

The 2010 FHP offering will be announced in April 2010.


Some of the statements made in this announcement are "forward-looking statements," which include statements with respect to the Bank's beliefs, plans, objectives, goals, expectations, anticipations, assumptions, estimates, intentions, and future performance, and involve known and unknown risks, uncertainties and other factors, many of which may be beyond the Bank's control, and which may cause the Bank's actual results, performance or achievements to be materially different from the future results, performance or achievements expressed or implied by the forward-looking statements.

The forward-looking statements may not be realized due to a variety of factors, including, without limitation: legislative and regulatory actions, changes or approvals; future economic and market conditions (including the housing market and the market for mortgage-backed securities); changes in demand for advances or consolidated obligations of the Bank and/or the FHLBank System; changes in interest rates and prepayment speeds, default rates, delinquencies and losses on mortgage-backed securities; political, national and world events; and adverse developments or events affecting or involving other Federal Home Loan Banks or the FHLBank System in general. Additional factors that might cause the Bank's results to differ from these forward-looking statements are provided in detail in our filings with the Securities and Exchange Commission, which are available at www.sec.gov.

New factors may emerge from time to time, and it is not possible for us to predict the nature, or assess the potential impact, of each new factor on our business and financial condition. Given these uncertainties, we caution you not to place undue reliance on forward-looking statements. These statements speak only as of the date that they are made, and the Bank has no obligation and does not undertake to publicly update, revise or correct any of the forward-looking statements after the date of this announcement, or after the respective dates on which such statements otherwise are made, whether as a result of new information, future events or otherwise, except as may be required by law.

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INPUT Issues New Report Card on Economic Stimulus Package

(BUSINESS WIRE)--INPUT, the leading authority on government business, today announced an updated Report Card grading the Obama Administration on its execution of stimulus package objectives for the American Recovery and Reinvestment Act (ARRA) of 2009. The new grades were issued based on the release of the much anticipated recipient reports required by the ARRA. They cover four key recovery areas: Speed of Spending, Job Creation, Transparency & Reporting, and Contracting Effectiveness.

Since its first Report Card in June, which graded the Obama Administration on its execution of stimulus objectives during the first 100 days of the ARRA, INPUT has made noteworthy updates to its evaluation. Contracting Effectiveness received the most improved grade, moving from a C- to a B based on federal agencies’ significant improvement in the use of fixed price contracts and in the percentage of contract awards to small businesses. Transparency and Reporting also rose from a D to a C-, still leaving significant room for improvement to address late reporting and a lack of transparency surrounding grants applications for many programs. Speed of Spending continued to receive INPUT’s highest grade, earning a B+ based on the federal government’s adeptness in dispensing a tremendous amount of money very quickly. Meanwhile, Job Creation again received an Incomplete.

“The federal government has continued to dispense stimulus money at a record pace,” said Timothy Dowd, CEO of INPUT. “However, questions still remain about how that spending is translating into new jobs. While INPUT’s latest report card points to some noteworthy areas of improvement in the Administration’s execution on the stimulus, there is still much work to be done to address shortcomings across all key recovery areas.”

Speed of Spending: B+

In Vice President Biden’s first Quarterly Report to the President on Implementing the American Recovery and Reinvestment Act of 2009, he stated that the President had set a goal of spending $350 billion by Sept. 30, 2010. In order to achieve that goal, the federal government needs to spend $4.16 billion per week. The Administration’s speed of spending has remained nearly the same as INPUT’s last scorecard, averaging $3.6 billion per week. At its current pace, the administration will spend $305.2 billion by September 30 of next year, achieving 87% of its previously stated goal.

Job Creation: Incomplete

President Obama promised 3.5 million to 4.0 million jobs would be created or saved with the passage of the Recovery Act. While recently released recipient reports put that number at 640,329 eight months after the ARRA’s enactment, the unemployment rate has risen from 8.9 percent to 9.8 percent during the same period. Additionally, 2.6 million people have lost their jobs since March and 512,000 new unemployment claims were filed during the week ending October 31, 2009.

Despite the recent release of initial recipient reporting, INPUT continues to believe that accurate reporting of job creation is ultimately unknowable because of the number of recipients reporting, the complexity of the reports, the definition of a saved job, and recipients were allowed to use a calculation when they were unable to provide actual data. As a result, INPUT once again gave the Administration an Incomplete for Job Creation.

Meanwhile, recipient reporting has shown that the cost of each job created varies wildly from state to state. For example, the cost per job created or saved in Pennsylvania was $488,930, compared to $41,475 in Montana.

Perhaps the most troubling issue is the concentration of created or preserved jobs in the public sector. Based on its analysis of recipient reports, INPUT discovered that more than half of the total number of jobs created are in the areas of education, criminal justice, corrections and public administration. There are serious concerns about what happens to these jobs when stimulus money runs out and states are still faced with nearly $200 billion in budget gaps.

Transparency and Reporting: C-

INPUT has raised the Administration’s grade for reporting and transparency from a D to a C-. Each new report has been late, based on the Office of Management and Budget’s (OMB) initial guidance, and the data quality of each new report has been poor upon release. However, over time the quality and completeness of previous reports has improved and INPUT expects this trend will continue. A major area of disappointment continues to be the lack of transparency surrounding applications for many of the grant programs funded by the Recovery Act.

“INPUT encourages the Administration to reconsider its approach with respect to publication of grant applications,” said Dowd. “By allowing citizens access to grant applications before the awards are made and the opportunity to comment on those applications, federal agencies could truly be taking a proactive approach to combating fraud, waste and abuse.”

Effectiveness of Contracting: B

According to INPUT’s latest analysis, federal contracting officials have substantially improved their performance in the use of fixed price contracts, small business involvement, and the establishment of new contracts. As a result, INPUT has raised the Administration’s grade for Effectiveness of Contracting from a C- to a B.

To date, the federal government has awarded 48 percent of the reported contract obligations using fixed price contracts, a 30 percent increase over INPUT’s initial report card. In addition, 86 percent of the reported contract obligations are being channeled through competitive contracts. Almost 70 percent of the reported obligations have been issued against contracts that were already in place prior to passage of ARRA. This is a significant improvement from the 94 percent use of existing contracts in June.

In addition, nearly 27 percent of the contracting dollars awarded have been to small businesses, 4 percent above the government-wide goal of 23 percent and a substantial increase from the 11 percent reported in June. With the small businesses creating 60 percent of the net new jobs since the mid 1990s, the Administration’s pattern of spending in this sector bodes well for job growth.

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World Unlikely to Scrap Current Reserve System Despite Weak Dollar, Says CornerCap Investment Counsel

/PRNewswire/ -- Despite the recent credit crisis and headlines about the possible demise of the dollar as the world's dominant currency, it is unlikely that the world will scrap the current reserve system anytime soon, CornerCap Investment Counsel concluded in a recent report (go to http://www.cornercap.com/library/Newsletters/n2009fall.pdf for the complete report).

While the dollar will inevitably surrender some of its dominance, too many major players like China and OPEC have a vested interest in a financially strong U.S. to undermine the dollar's position too strongly, according to Cannon Carr, chief investment officer.

Instead, Carr anticipates an orderly transition to a post-dollar world, one that will take a decade or more, and probably with U.S. leadership.

"The dollar's position as the world's dominant currency has been key to our standard of living since World War II, and its standing plays a vital role in the U.S. recovery," Carr said. "Moving radically away from the U.S. dollar as the dominant currency would limit our return to economic growth, at a time when other countries need a healthy US to boost their own economies," he added.

However, high U.S. debt levels and deficits, when combined with a weak growth outlook, do increase the risk to a currency system tied to the dollar. With a sustained weak dollar, non-U.S. countries can find their exports expensive and their own economies influenced by poor policy choices by the US. So while other nations can tolerate a weak dollar, an irresponsibly sustained weak dollar jeopardizes their financial stability and could force them to seek more radical change to the reserve system.

What's more, without convincing economic growth (say 4% annually); the U.S. will have to balance national debt levels, deficits and government spending to manage the dollar's position. Special attention must be given to government spending (for growth, social programs, entitlements, or war), which is typically financed through taxation, borrowing, or inflation. Pushing too far in those areas would have serious ramifications for the dollar.

Carr believes the dollar's recent descent may reflect investors' increased risk tolerance rather than collapsing faith in the U.S. system. When fear reached its peak in October 2008, investors sought safety in U.S. Treasury instruments and the U.S. dollar. If fear returns, those two investment vehicles could be once again viewed as safe havens.

What does the dollar's outlook mean for investors? Pursuing radical strategies today are likely to yield sub-par investment results over time.

"We continue to believe deflationary forces may prevail for the immediate future but inflation has a higher probability in perhaps four to five years," Carr said. Predicting when that inevitable transition will occur is impossible, and CornerCap recommends diversified investment portfolios that balance the risk/reward across many uncertainties, including deflation, inflation, or a normal recovery.

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Small Businesses Get Whacked With Tax Increases in Pelosi Health Bill

/PRNewswire/ -- The Joint Committee on Taxation (JCT) is reporting what the small business community has been saying all along -- proposed tax increases on the "wealthy" amount to big tax increases on small business owners. In a November 3, 2009 memo, the JCT estimates that one-third of the $460.5 billion estimated to be raised from H.R. 3962, the "Affordable Health Care for America Act," through a proposed 5.4 percent surtax is business income. According to the Small Business & Entrepreneurship Council (SBE Council), America's economic recovery is highly dependent on small-business job creation and investment. Seizing more of their hard-earned capital flies in the face of White House efforts, for example, to provide small businesses with access to credit and capital, according to the advocacy group.

"No wonder small business owners are gripped by uncertainty. With mixed messages coming from Washington, they don't know whether to add to their payrolls, hoard cash, cut jobs or stay-the-course," said SBE Council President & CEO Karen Kerrigan.

Kerrigan added: "More than $150 billion of the proposed surtax alone falls on the backs of small business owners, according to the JCT. When will those who support these tax hikes wake up to the fact that they are sucking oxygen out of the very businesses that need this capital for survival and growth. Businesses can't save or create jobs without money. All of the tax increases proposed in the House health bill will deprive the private sector of the capital it needs to hold onto their workers, create more job opportunities, invest, innovate and grow."

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Small-Business Bankruptcy Filings Up 44% Year-over-year, Equifax Data Shows

/PRNewswire/ -- Commercial bankruptcies among the nation's more than 25 million small businesses increased by 44% from the third quarter of 2008 to the third quarter of 2009, according to Equifax Inc. (NYSE:EFX) , which analyzes its comprehensive small business database for the on-going study.

Comparing the month of September 2008 to September 2009 shows an increase of 27 percent. There were 9361 bankruptcy filings in September 2009 throughout the U.S., up from 7386 a year ago, according to the data.

California remains the most negatively affected state with eight MSA's (metropolitan statistical areas) among the 15 areas with the most commercial bankruptcy filings during September 2009.

Los Angeles, Riverside/San Bernardino and Sacramento metropolitan areas continued to lead the nation in small-business bankruptcy filings as they did at the end of the second quarter. The other MSA's with the most bankruptcy filings during the month include:

-- Denver-Aurora, CO
-- Santa Ana-Anaheim-Irvine, CA
-- San Diego-Carlsbad CA
-- Dallas-Plano-Irving, TX
-- Portland-Vancouver-Beaverton, OR-WA
-- California (excluding MSA's within the state)
-- Oakland-Fremont-Hayward, CA
-- Oregon (excluding MSA's within the state)
-- Chicago-Naperville-Joliet, IL
-- Houston-Sugar Land-Baytown, TX
-- San Jose-Sunnyvale-Santa Clara CA
-- Atlanta-Sandy Springs-Marietta, GA

"Economic pain is continuing for small businesses across the country. We're still seeing hefty increases in the number of bankruptcies in a lot of major metro areas." said Dr. Reza Barazesh head of North American research for Equifax's Commercial Information Solutions division.

"However, the 69 percent drop and 49 percent decline in bankruptcies in Charlotte and New York-White Plains respectively, and a 44 percent drop in Atlanta between the second and third quarters indicates that the East Coast may be experiencing an earlier recovery from the recession than the West Coast."

Charlotte - number four in June - dropped out of the top 15 entirely to 39th; Atlanta dropped from fifth to 15th; and New York - White Plains dropped from eighth to 24th.

Equally consistent with this east/west difference over the same period, the 11th, 12th and 13th MSAs with the greatest number of bankruptcies at the end of the second quarter of 2009 -- Santa Ana-Anaheim, Denver and San Diego -- increased in rank to 5th, 4th, and 6th by the end of the third quarter. Santa Ana-Anaheim increased three percent, Denver was up 13 percent and San Diego increased four percent.

For its research, Equifax reviewed and analyzed small business data for the month of September, the most recent month for which complete data is available, and compared it with results from September 2008. Equifax defines a small business as a commercial entity of less than 100 employees.

The company's report also listed the 15 metro areas with the fewest small-business bankruptcy filings. They are:

-- Charleston, WV
-- Trenton-Ewing NJ
-- Tallahassee FL
-- South Bend-Mishawaka IN-MI
-- New Jersey (excluding MSA's within the state)
-- Holland-Grand Haven MI
-- Gainesville FL
-- Baton Rouge LA
-- Wilmington NC
-- Toledo OH
-- Roanoke VA
-- Lubbock TX
-- Lancaster PA
-- Springfield MA
-- Savannah GA

For the analysis, Equifax analyzed Chapter 7, 11 and 13 filings. Chapter 7 is a liquidation proceeding in which a debtor receives a discharge of all debts; while Chapter 11 and Chapter 13 are reorganization bankruptcies enabling individuals and companies to pay off debt over a set period of years.

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