The new Quantitative Easing Program from the Federal Reserve continues to be much in the news. Financial writer John Mauldin wonders if the program will have unintended consequences. We begin this week with his article examining that possibility.  We follow with a discussion about the “fiscal cliff” that could occur at the end of this year and how this uncertainty affects the markets.  Our next article is about the phenomenon of younger workers in their twenties and thirties being shocked into saving more.  This is actually a good thing.  Finally, for those who may be wondering how this coming election may affect the markets, we examine the historical returns in a post-presidential election year.

QE Infinity: Unintended Consequences – The new Quantitative Easing Program is being referred to as QE Infinity. A number of economists and financial experts are wondering about the effectiveness of this program and its possible unintended consequences.  This article by John Mauldin makes the point that there is only so much the Federal Reserve can do to lower unemployment and keep inflation around 2%.

US Fiscal Cliff Looms Causing Uncertainty – This article in Reuters discusses the problem of the “fiscal cliff” that could occur at the end of the year with a combination of austerity and tax increases.  It suggests that the uncertainty surrounding it is putting a drag on the recovery of the US economy.

New Wave Of Workers Tries Novel Approach, Save More – This article in the Wall Street Journal indicates that many workers in their twenties and thirties are being shocked into the realization that they need to save more money.  Maybe the lesson here is that we need financial literacy courses starting the middle school.

What To Expect From Post-Election Year Markets – We are often asked what we believe will happen after the election.  This article by Lance Roberts examines historical post-election returns in both bull and bear secular markets.

We hope you enjoy reading these articles along with us and that you find them informative.  Please forward this to your friends and family.

John R. Day and Bill W. Ennis