Austerity Measures

An austerity measure is an official action taken by a government in order to reduce the amount of money that it spends on its citizens. Following the worldwide credit crisis of 2008, austerity measures became popular with high-debt governments. For countries with a high debt-to-GDP ratio, austerity measures often become a necessity. Examples of government austerity measures include an increase in the official retirement age (to reduce government retirement payments), a reduction in the number of days garbage is picked up (to reduce municipality costs), and a reduction in school days for children (to reduce government employee costs).


As it stands, the U.S. national debt has skyrocketed to above $17.4 trillion. With this year’s budget deficit expected to be around $500 billion, we’ll be at a national debt of $18.0 trillion in no time. In fact, a $30.0-trillion…

I will be first to say that this is a difficult market to play, and it’s certainly full of stock market risk. On one hand, the Dow Jones Industrial Average eclipsed a new record last week when the blue chips…

As debt-infested European countries are struggling with implementing austerity measures, American taxpayers should buckle up for a taste. The U.S. economy is on its way to austerity measures, but not by choice. According to a study done by investment research…

The stock market bounced back from an oversold position (although a week later than I thought it would), but there aren’t too many reasons why it should go upward. For the most part, earnings growth is expected to be flat…

The stock market is on the third leg of a repeating pattern that began about three years ago. The spectacular stock market decline that began in 2008 hit a bottom in March 2009, and then promptly recovered. July 2009 saw…

With the recent corporate earnings release from Apple Inc. (NASDAQ/AAPL), many investors are unsure how best to trade the stock. Before we get to that, let’s take a closer look at the corporate earnings the firm posted. The common thread…

As I have been warning in these pages, corporate revenue growth within the global economic slowdown is going to be very hard to come by for the remainder of 2012. So far, about 25% of all S&P 500 companies have…

This week, we have renewed fears that the financial crisis in Europe is worsening by the day, leading to a continued lack of investor confidence. Ten-year bond yields in Spain are surging to record interest rates of 7.6% on news…

The eurozone is on shaky ground. European Union leaders will be meeting on Thursday to begin an emergency two-day summit as the region’s leaders attempt to localize and corral the European debt crisis. Spain has formally requested emergency funds to…

Since the financial crisis hit in 2008, central banks around the world have enacted unprecedented expansive monetary policy that has been extreme and unusual. (In simple terms, they’ve printed money like never before.) The hope was that by lowering interest…