7 Reasons the Economy is Worse than it Seems

Do you believe the economy has improved significantly since the Great Recession?

Or do you feel like we’re staring down the barrel of a cannon whose fuse has already been lit?

The stock markets should be down considerably by plenty of measures, but many investors appear to have been hypnotized to believe that nothing can go wrong.

I believe things are worse than they may seem on the surface, and extreme caution is warranted, for the 7 reasons I spell out here.

I’ll also give you some tips on how to protect yourself and have a “Plan B” in place in case the you-know-what does hit the fan.

Here Are 7 Reasons the Economy is Worse than It Seems…

1. Addiction to Stimulus and Low or Negative Interest Rates

We have been guinea pigs in the greatest experiment in monetary policy in the history of the world.

Every time the Federal Reserve so much as sneezes, the markets whipsaw. In this topsy-turvy world, good news about the economy becomes bad news for the stock market and vice versa.

Even the Fed knows it’s in over its head and has lost control of the situation. But that won’t stop them from continuing to experiment with you and me as their lab rats.

2. Overheated Stock Market Valuations and Deteriorating Fundamentals

Profits for S&P 500 companies continue falling, but the S&P 500 is trading at the highest level of projected earnings since 2002.

3. Rising Poverty and Expanding Government Assistance Rolls

The U.S. poverty rate has actually risen since the “official” end of the Great Recession in 2009. (I say “official” end because, to a lot of Americans, it still feels like we’re mired in a recession.)

During the same period of time, food stamp usage increased 39%.

4. Persistent Underemployment

A measure of the number of people working part time who want – but can’t find – full-time work in their field, that peaked above 16% at the height of the last recession, still remains above 12%. Obviously, that’s a major drag on economic performance.

5. Slow Wage Growth

Between 2009 and 2015 inflation-adjusted median weekly earnings actually fell by about 1%, and median household earnings fell by around 4%.

6. Global Economic Weakness

Many people underestimated how the economic situation in other parts of the world affects our economy. But no one can deny any longer how interconnected our economics all are.

Emerging economies like Brazil and Russia have been heavily impacted by falling commodity prices.

The largest economies in Europe are struggling. And China, which is now the world’s second-largest economy, is experimenting with an economic transition that many think is likely to fail.

If it does fail, the U.S. economy could be seriously impacted.

7. By Historical Standards, We’re Already Overdue for Another Recession

Historically, recessions occur at alarmingly regular intervals.

In fact, according to the National Bureau of Economic Research, by post-war standards, we’re almost two years past due for the next recession. Ugh.

The political uncertainty we are facing with the upcoming election isn’t helping any either.

As people who know me well will tell you, I’m an optimist – I always see the glass as half full.

But while I hope for the best, I also have a backup plan – my “Plan B” to help my family weather those tough economic times that seem to come when you least expect them.

What Characteristics Should a True Safe Money Plan B Have?

It should have all of these:

• No loss of principal or gains in a market crash (safety nets)
• Guarantees
• Liquidity
• Control
• Tax-favored
• Contractual growth guarantees

Out of the more than 450 financial products I’ve investigated, only one meets all the requirements: The Bank On Yourself method, based on super-charged dividend-paying whole life insurance. These plans have increased in value every single year for more than 160 years, in every period of boom and bust, including during the Great Depression.

And no luck, skill or guesswork is required to make that happen.

In addition to the benefits I mentioned above, the Bank On Yourself method also provides:

• Asset Protection – your cash values are protected from creditors and lawsuits (varies by state)
• Privacy – your plan and its growth, along with the income you take from it, are generally not reported to the government or IRS
• Lets You Become Your Own “Banker” – so you can get access to cash whenever and for whatever you want – no questions asked

You control how and when you pay it back and – if your policy is from one of a handful that offer this feature – your plan can continue earning the same guaranteed annual increase and any dividends the company credits, even when you’re using that money elsewhere!

Here’s the Key Question to Ask Yourself:

Does having your money…

• safe…
• liquid…
• growing significantly faster long-term than a savings, money market account or CD…
• and earning the exact same guaranteed annual increase and dividends – even when you use it

… take away any of your options?

The reality is that it gives you more options, not fewer.