Examining Fed’s New Targeted Inflation Policy

5 min read

2020 Federal Reserve Inflation PolicyLooking back to 2012, the Federal Open Market Committee (FOMC) – a collaboration of the 12 regional Fed banks and the Federal Reserve Governors in Washington – came together and published a Statement on Longer-Run Goals and Monetary Policy Strategy.

This officially rang in the FOMC’s public commitment to maintain inflation at 2 percent. It is based on a yearly change in the Personal Consumption Expenditures (PCE) price index, and is in accordance with The Federal Reserve’s “mandate for maximum employment and price stability.”

Guided by three events in the economy, according to the Brookings Institution, the FOMC was prompted to take a second look at 2012’s existing framework. The first factor, an approximation of the “neutral level” of interest rates, or interest rate levels correlated “with full employment” and inflation targets, kept dropping globally. The “lower neutral rate” is achieved when short-term interest rates, which are controlled by The Fed, stay at levels closer to zero versus higher levels. When this occurs, The Fed has little room to further lower interest rates, and therefore stimulate the economy. The next factor involves inflation rates and anticipation for future inflation rates to stay below The Fed’s 2 percent target. The last factor was unemployment falling to a five-decade low.

The FOMC’s Aug. 27 update reveals that the inflation rate has been lower than the 2 percent inflation target in recent years, despite housing, food, and energy increasing in price for consumers.

When there’s too little inflation, as The Fed explains, it can negatively impact the economy. If inflation remains below The Fed’s “longer-run inflation goal,” it can propel a self-fulfilling prophecy of further declining inflation levels.

As originally explained in 2012 and updated in August, the FOMC’s purpose is to “promote maximum employment,” keep prices stable, and “moderate long-term interest rates.” It also guides individuals and business owners with more information to make decisions, promotes greater “economic and financial certainty” and increases “transparency and accountability.”

The Fed, based on their FAQ section, has said that when inflation runs below 2 percent for an extended period of time, monetary policy will adjust to run above 2 percent for a period of time. Therefore, the FOMC is hoping to ensure that “longer-run inflation” will average at 2 percent.

The FOMC’s monetary policy is a big determinate in keeping the economy stable when the economy and financial systems are put out of balance due to factors such as inflation, long-term interest rates, and employment. The FOMC accomplishes its monetary policy via the “target range for the federal funds rate.”

Looking at the “level of the federal funds rate consistent with maximum employment and price stability over the longer run,” this rate has dropped compared to past average rates. With this in mind, the federal funds rate is generally expected to remain on the lower end of the rate spectrum more so now, versus years back. With interest rates closer to the bottom end, the FOMC believes that inflation and employment perils are more likely to stay depressed.

Based on comments from The Fed in August, the FOMC clarifies its Congressional Mandate regarding price stability and maximum employment, along with determinations on its short-term interest rate and other monetary policy considerations.

Following up on its Congressional mandate for The Fed to ensure maximum employment and price stability, the first thing to focus on is price stability or inflation.

Before, The Fed had a price stability target of 2 percent inflation, based upon the Personal Consumption Expenditures price index. The FOMC called this price stability “symmetric,” meaning that inflation above or below the target is equally concerning.

However, its new stance will now focus on attaining “inflation moderately above 2 percent for some time” after an ongoing time period of tame inflation. Based on comments from Fed Chair Jerome Powell, this is a flexible form of average inflation targeting.

This end goal of average inflation targeting suggests that when inflation is below the 2 percent target over an extended period of time, the FOMC will adjust its policy to encourage inflation above the 2 percent target to attain balance. However, The Fed didn’t give details regarding the time frame for its new averaged 2 percent inflation target, nor did it specify what actions it will implement to achieve it.

The Fed also made noteworthy changes to its “maximum employment” mandate. When it comes to this measurement, it originally compared the projections of “the long-run rate of unemployment” to the unemployment rate. According to the Brookings Institution, this also can be referred to as “the natural rate of unemployment or the non-accelerating inflation rate of unemployment (NAIRU).”

Since live estimates of the NAIRU can be unreliable, it’s no longer being considered. While the Summary of Economic Projections will still include estimates of unemployment statistics by FOMC members, it will unofficially take the place of the NAIRU readings. However, these FOMC members’ long-run estimates of unemployment will have less impact on monetary policy decisions.

How Do Interest Rates Looking Going Forward?

With these two changes to The Fed’s Congressional mandates, many expect monetary policy to be quite loose over the coming years, according to the Brookings Institution. By permitting hotter than normal inflation and low rates of unemployment, there’s a remote chance The Fed will increase interest rates prior to inflation running north of 2 percent for a measurable time period. 

Five Ways to Manage Back-to-School Stress

4 min read

Five Ways to Manage Back-to-School StressIf you’re anxious about sending your children back to school, you’re not alone. In fact, a recent poll from ABC News/Ipsos showed that 45 percent of parents don’t want their kids in the classroom at all. But whether your kids are in school or learning at home, there’s still plenty of worry to go around. How do you cope? Here are a few suggestions from a variety of counselors and mental health professionals that can help.

Express Your Feelings

Noticing the anxiety that’s going on inside is half the battle – then let it out. “I would encourage parents to share this feeling with their partners or other family and friends,” says Michael Consuelos, MD, a senior medical advisor with the mental health management platform NeuroFlow in Philadelphia. Simply releasing what you’re feeling can often take the power of it.

Teach Your Kids How to Navigate

This starts with talking to your kids about what social distancing is, what it looks like, and how to wash their hands thoroughly. Fran Walfish, PsyD, MFT, and a family and relationship psychotherapist in Beverly Hills, Calif., suggests making up real-life situations and getting your kids to “think in advance about what they would say or do to protect themselves while preserving a friendship.” For instance, a friend of your son stands too close to him and asks to borrow a ruler. How should he react? Or your daughter is eating lunch and a friend reaches in and takes a few chips from her Doritos bag. What should she do? You can probably come up with many other scenarios that help your kids figure out the best options for keeping safe.

Have Honest Conversations

Kathleen Rivera, MD, a psychiatrist who specializes in children and adolescents at Nuvance Health in Danbury, Conn., strongly suggests talking with your kids about the situation, no matter how young they are, and asking them how they’re feeling about the changes in their school environment. What things about school do you miss the most? How is this new learning set-up working for you? What are things you don’t miss about school? Claudia Kohner, Ph.D., a licensed psychologist and creator of IntroDUCKtion to Very, Very Big Feelings app, says that if you have very young children, give them some colored pencils and a coloring book. Sit down with them and help them create a homemade book that describes the changes in their school setting and reflects their feelings that go along with it. Encouraging imaginative play with dolls and stuffed animals is also a great way to help your kids express what they’re going through.

Practice Self-Care

In these uncertain times, it’s more important than ever to be kind to yourself – and not judge yourself for failing to cross everything off your to-do list. “You don’t have to do it all,” says Elizabeth Derickson, MSW, LCSW, RPT, a therapist with online therapy provider Talkspace. This is her No. 1 piece of advice for parents who are dealing with back-to-school anxiety. She suggests setting up realistic expectations and acknowledging that there will be both good days and bad days, and allowing yourself “to learn from the bad days, move on and rock those good days.”

Embrace Change

In a few months, the landscape of your life might look radically different than it does today. That’s why being able to adapt to whatever new circumstance presents itself is key. According to Dr. Rivera, “Flexibility is the most important thing in this whole process.” Knowing you have every right to reverse your decisions is OK – and empowering.

Despite the seemingly never-ending stream of worries that inevitably crop up in our new abnormal, remember: the most constant thing in life is change. Things will get better.

Sources

https://www.realsimple.com/health/mind-mood/stress/manage-back-to-school-stress-coronavirus

https://www.ipsos.com/sites/default/files/ct/news/documents/2020-06/topline-abc-coronavirus-wave-12.pdf

Tips for Retiring in the Next 10 Years

4 min read

Tips for Retiring in the Next 10 YearsThe stock market continues to perform with relative resilience, despite the current economic decline. But to be clear, without 100 percent participation in the economy – in terms of small business job creation, consumer spending, and company growth and expansion – the stock market is apt to reposition prices to reflect slower growth. With no containment or control of the pandemic on the horizon, there is plenty of uncertainty associated with future financial planning.

Anyone looking to retire in the next 10 years or so may want to take a fresh look at their current retirement income plan. In fact, they might need a Plan A, B, and C in order to stay flexible – with C being the option to continue working longer. The following are portfolio tips to consider for a 10-year time frame until retirement.

Emergency Fund

If there was one financial tip worth following pre-pandemic, it was to have liquid cash savings of six months to a year’s worth of expenses available. Workers who did are probably pretty relieved about now if they lost their job or had hours reduced. Having substantial cash available can save you from raiding retirement accounts and/or your investment portfolio.

In preparation for retirement, that cash buffer is even more important. Some advisors recommend a liquid savings fund to cover one to three years’ worth of expenses. That’s because once you’re on a fixed income, you’re not likely to replenish that account. What it can do is supplement variable retirement income that is reliant on the markets. Having a cash buffer gives investments time to recover from temporary losses so you don’t have to plunder your principal.

Status of Social Security

While you may know what your benefit level is for retirement at a certain date, be aware that your benefit could change – even after you’ve retired. Recent research has found that thanks to the loss of FICA revenues resulting from COVID-19, the Social Security Trust Fund might run out of money four years earlier than predicted: as early as 2032. You may want to consider other forms of reliable income in case your benefits are reduced in the future.

Guaranteed Income

Speaking of reliable income, Olivia Mitchell, executive director of the Wharton School’s Pension Research Council, recommends that an annuity option become a staple in employer-sponsored retirement plans. Annuities generally offer an option for issuer-guaranteed income for life. With 10 years until retirement, allocating money to an annuity can help build a separate income stream to supplement Social Security benefits. Even if your employer doesn’t offer an annuity option in your 401(k) plan, you can purchase one separately using other assets.

Employer-Sponsored Retirement Plans

Speaking of the 401(k), consider that when this plan was first established in 1980, the marginal federal income tax rate was 43 percent. Today’s tax rates are historically quite low, so for the time being you might want to consider allocating more savings into a Roth IRA. This means you’ll pay taxes on that money at today’s low rates, but going forward it can grow tax-deferred and be withdrawn tax-free. But don’t leave money on the table if your employer offers a matching 401(k) contribution. Roth IRA contributions are limited to $7,000 (2020) and some deferred income can help reduce your taxes today – so plan accordingly.

Roth Conversion

By the same token, you may want to take advantage of today’s lower tax rates by converting at least some traditional IRA funds to a Roth or by making backdoor Roth IRA contributions. Be aware, however, that you must pay taxes on converted funds, so consider a gradual transition over multiple years to help you stay in a lower tax bracket.

Investor Portfolio

Some market analysts are predicting a “new normal” going forward, which could provide some interesting investment opportunities. Ideas include new operating business models based on a largely remote workforce, population spread as people move out of cities into more affordable rural areas, and innovations borne out of newly created demand. While a buy-and-hold strategy is a common advice for equities, it’s important to stay flexible. As long as you remain within your customized asset allocation strategy, you might want to use your equity portion to explore new ideas that could offer higher return opportunities over the next decade.

3 State Level Tax Hikes That Might Be Coming Due to COVID-19

3 min read

3 State Level Tax Hikes That Might Be Coming Due to COVID-19No surprise, but Americans are consuming and spending less since the coronavirus kicked in.  Retail sales dropped to 8.7 percent in March, the largest month-over-month decline since the Census Bureau started tracking this data. Previously, the sharpest decline was less than half this – at 3.9 percent from October 2008 to November 2008, during the previous economic crisis. The reduction in consumer spending is due in part to lockdowns, spending more time at home for fear of the virus, and the economic impact – whether it’s losing a job, reduced hours, or in anticipation of tougher times ahead.

While consumer spending is down at a net level, there appear to be some winners and some losers in the post-COVID world of staying in and working from home. Restaurants and apparel are the hardest hit, whereas online retailers, home, garden, grocery, and alcohol sales are all up.

The decline and shift in consumer spending are having a strong negative impact on state sales tax revenues. Nationwide, sales taxes account for approximately 20 percent of all state revenue, so the decline in consumer spending will have a material impact on state budgets. As a result, states are looking at new ways to generate or increase revenue to offset the trend. Below we’ll look at three ways states are looking to raise taxes to make up for holes in their budgets.

Grocery Staples 

Eating out less and working from home mean Americans are spending more at the grocery store; approximately 13 percent more year-over-year, per Census data. The issue for states is that groceries are generally not taxed or low-taxed, although there are a few items that apply the full tax rate.

Kansas, for example, applies the full sales tax rate to groceries. The consequence of this is that grocery sales make up about 15 percent of Kansas’ total sales tax revenue. The consequence of this policy is that the state’s sales tax revenue has barely taken a hit year-to-date.

States are taking notice and may move to the trend of taxing groceries as a way to recover part of their declining sales tax revenues.

Digital Taxes

Another trend is the increase in streaming services and one-time rentals/purchases of digital goods for entertainment and working at home. Currently, 22 states tax streaming services, and 30 states tax digital goods. Other states will look to start taxing these services as well, and digital taxes will start to expand into cloud storage and other services as more people work remotely.

Sin Taxes

Sin taxes are taxes on goods and services that are “bad” for us; think alcohol, tobacco, gambling, and marijuana (where it’s legal). Increases in sin taxes are generally easier to pass as they don’t apply to the overall general population and politicians can play the moral angle.

During the last recession, for example, lawmakers in more than 12 states increased tobacco and liquor taxes. Newer sin taxes are being instituted, such as those on vaping equipment and supplies.

Conclusion

The exact form and structure will vary, but one thing is certain: States will institute or increase taxes in areas where the money is being spent to ensure their sales tax revenue remains stable. 

Laws to Enhance Benefits for Service Members, First Responders, Veterans and to Restore National Parks and Public Lands

Laws to Enhance Benefits for Service Members, First Responders, Veterans and to Restore National Parks and Public Lands

4 min read

Laws to Enhance Benefits for Service Members, First Responders, Veterans and to Restore National Parks and Public LandsA bill to amend the Servicemembers Civil Relief Act to extend lease protections for servicemembers under stop movement orders in response to a local, national, or global emergency, and for other purposes (S 3637) – This bill extends the Servicemembers Civil Relief Act to protect service members who were previously issued orders to change duty stations but had those orders rescinded because of the pandemic. A stop movement order may leave them with a housing and/or car lease in two different locations. This extension allows families who are unable to relocate due to pandemic-related travel restrictions to be released without penalty from their leases. It is retroactive to March 1, 2020. The bill was introduced by Sen. Jon Tester (D-MT) on May 6. It was passed by the Senate in June, the House in July, and was signed by the President on Aug. 14.

Safeguarding America’s First Responders Act of 2020 (S 3607) – This bill was introduced by Sen. Chuck Grassley (R-IA) on May 5. The bill extends death and disability benefits under the Public Safety Officers’ Benefits Program (PSOB) to public safety officers (e.g., law enforcement officers) and survivors of public safety officers who die or become injured as a result of COVID-19. The bill classifies COVID-19 or related complications suffered by a public safety officer as a personal injury sustained in the line of duty. The Act was passed in the Senate in May and in the House in July. It was signed into law on Aug. 14.

Veteran Treatment Court Coordination Act of 2019 (HR 886) – Introduced by Rep. Charlie Christ (D-FL) on Jan. 30, 2019, this legislation directs the Department of Justice to establish a Veterans Treatment Court Program to provide grants and technical assistance for state, local and tribal governments to develop and maintain veterans’ treatment courts. Treatment courts are designed to assist justice-involved vets with treatment needs such as substance abuse, mental health, and other issues unique to active service. The Act was enacted after being signed by the President on Aug. 8.

Ryan Kules and Paul Benne Specially Adaptive Housing Improvement Act of 2019 (HR 3504) – This bill is designed to amend Title 38 of the United States Code that provides for improvements to the specially adapted housing and educational assistance programs of the Department of Veterans Affairs. It is designed to help eligible disabled veterans purchase adaptive homes or upgrade existing homes to meet their specific needs for daily living activities. The bill was introduced by Rep. Gus Bilirakis (R-FL) on June 26, 2019. It was passed in the House in July 2019; in the Senate in March 2020, and was signed into law by the President on Aug. 8.

Great American Outdoors Act (HR 1957) – This Act was initially sponsored by Rep. John Lewis (D-GA) on March 28, 2019. This legislation establishes the National Parks and Public Land Legacy Restoration Fund, which is designed to support deferred maintenance projects on federal lands for fiscal years 2021 to 2025. The bill makes funding for the Land and Water Conservation Fund permanent and allocates money equal to 50 percent of energy development revenues from oil, gas, coal, or alternative or renewable energy development on federal lands and waters. The bill establishes reporting procedures for all associated projects and mandates that deposited amounts must not exceed $1.9 billion for any fiscal year. The bill was signed into law by the President on Aug. 4.

Commission on the Social Status of Black Men and Boys Act (S 2163) – Sen. Marco Rubio (R-FL) introduced this legislation on July 18, 2019. It is designed to establish a Commission on the Social Status of Black Men and Boys within the U.S. Commission on Civil Rights Office to conduct a systematic study of the conditions affecting black men and boys. The Act was passed by the Senate in June, the House in July, and was signed into law by the President on Aug. 14.

Three Strategies Companies Can Implement to Recover Faster

4 min read

Business COVID-19 Recover FasterSmall businesses nationwide were already facing cash problems before the COVID-19 pandemic, according to McKinsey & Company. The firm found that almost one-third of small businesses were either seeing losses or making just enough to stay in business, but not realizing profitability.

Looking at businesses selling essential and non-essential items, McKinsey & Company reports that before satisfying their “interest, taxes, depreciation and amortization” obligations and accountings, they were facing challenging times. When it comes to selling essential items, such as food, business owners in this industry only had margins of 5 percent. For businesses selling non-essential items, this sector saw margins of less than 10 percent.

Restaurants provide an example of one way that outfits can pivot and increase margins by modifying their business models. While the Harvard Business Review (HBR) explains that restaurants have created additional seating near the kitchen to maintain social distancing, other examples of business model changes include increasing takeout, delivery, and catering as a way to increase sales for businesses with limited in-store dining.

While these ideas are simply expanding upon existing models to make up for lost in-dining experiences, HBR offers another way that a restaurant can better distinguish its establishment: developing a subscription model for customers. By slimming down menu choices for more efficient and faster preparation, restaurants could give customers the option to receive a certain number of meals per week or day for a fixed price.

Increasing Margins

While there are different types of margins for business owners to keep an eye on, an important one is a gross margin and how it impacts a business’ bottom line. Since the onset of COVID-19, businesses have been trying to survive as we work our way through the pandemic.

Regardless of the type of product being sold, by reducing the number of options available to customers, businesses can increase their margins by still meeting customer demand for necessities while also getting better prices from their suppliers through larger orders. This strategy also can be applied with contract manufacturers.

Re-engineering products and the ingredients that go into them can help to increase margins. For example, if there is a variety of pre-packaged foods that sell for the same price, but there are specialty or costlier ingredients like meat instead of vegetables, pausing selling pre-packed meals with meat can increase profit margins.

McKinsey & Company explains that small businesses are able to increase their hygiene and safety protocols by encouraging and implementing contactless experiences. Along with reducing person-to-person contact by using mobile apps, restaurants also have made delivery and takeout a bigger part of their sales.

With small businesses like boutiques and farmers, HBR illustrates how these entities can explore different sales channels. With stores facing shortages and an inability to stock essential goods –  especially food items – small farmers saw an opportunity to reinvent their business models after restaurants and gourmet markets dropped purchases from them during the stay-at-home orders.

An investment in an online presence, shipping and logistics, and sustained sales and marketing efforts have real potential for businesses to become profitable as trends point to a direct-to-consumer model. However, going with a digital storefront such as Shopify and selling directly to retail customers, HBR pointed out that some farmers are able to capture local customers (15 miles or less). This shows how farmers have been able to migrate from one source of revenue to another.

While the pandemic is ongoing, these are just a few ways that companies can implement new strategies to generate cash flow and attempt to survive the COVID-19 pandemic. 

Sources

https://www.mckinsey.com/industries/public-and-social-sector/our-insights/us-small-business-recovery-after-the-covid-19-crisis

https://hbr.org/2020/07/how-businesses-have-successfully-pivoted-during-the-pandemic

How Will Monetary Policy Impact Markets Going Forward?

5 min read

How Will Monetary Policy Impact The Stock Markets September 2020?With gold hitting $2,000 an ounce in recent days, coupled with the Federal Reserve’s monetary policy creating a lot of liquidity, how will markets perform for the rest of 2020 and beyond?

Based on a reading from the Federal Reserve’s minutes from its July 28 to July 29 meeting, the Fed remarked that the ongoing pandemic would continue to put a strain on the economy, slowing expansion and causing additional damage to the country’s monetary framework.

The Fed highlighted the nation’s GDP drop by 32.9 percent in the second quarter. While Q3 growth is expected to be positive, that was not quantified. Additionally, the Federal government’s debt has grown by $3 trillion since the onset of COVID-19, reaching $26.6 trillion. The release of these minutes sent stock prices downward and helped the U.S. dollar gain.

Forward guidance or communication to the general public and business owners of the Fed’s goals for inflation and unemployment target figures could be upgraded, but no time frame was given. More details on how the target range for the federal funds rate’s path would be appropriate at some point, per the Federal Open Market Committee’s (FOMC) minutes. How the target range of the federal funds rate evolves is outcome-based or based upon meeting certain economic goals before rates see further movement. For now, The Fed’s mandate is to ensure full employment and price stability.

The FOMC is expected to keep the current overnight borrowing rate between 0 percent and 0.25 percent until the U.S. economy has emerged from its current situation and on course to achieve the Committee’s maximum employment and price stability goals.

The July meeting kept short-term interest rates at near-zero because the economy is still not at its pre-pandemic economic activity levels. Given that COVID-19 has already impacted the jobs picture, the value of the U.S. dollar, and how well the economy is functioning already in the near term, the FOMC see the pandemic continuing to impact economic growth in the medium term.    

The Fed remarked that the U.S. Congress needs to pass another economic stimulus plan, especially when it comes to renewing unemployment insurance that recently expired. The FOMC meeting also noted that the Fed is not expected to purchase bonds to control yields on government bonds. However, it did speak to how it has played a role in buying bonds on the open market to support liquidity during the COVID-19 pandemic. 

The meeting also determined that bond purchases by the Fed grew by more than $2.5 trillion, increasing to $7 trillion – up from $4.4 trillion over the course of the coronavirus pandemic. While skepticism by the Fed’s FOMC members regarding the use of purchasing bonds to manipulate the government bond yield curve wasn’t given much consideration, it’s still noteworthy to explain this versus what many refer to as quantitative easing or QE.

If the Fed’s efforts to bring down short-term interest rates, the rate that banks earn on overnight deposits, to zero with no positive economic effects, another tool the Fed has is Yield Curve Control (YCC). Whatever longer-term rate the Fed has in mind, YCC would involve an ongoing campaign of buying long-term bonds to maintain rates below its target rate by increasing the bond’s price and lowering the bond’s longer-term rates.

This is in contrast to QE, where the Fed purchases a fixed amount of bonds from the open market. It’s done by central banks to increase the money supply in hopes of spurring spending and investing by Main Street. It’s an important tool that central banks rely on when rates are at or near zero. This helps banks with their reserve requirements, giving them more liquidity to provide more loans to consumers and commercial borrowers.

Quantitative Easing Considerations

As central banks increase the money supply, it can create inflation. If it does create inflation, but there’s no measurable economic growth, this can lead to stagflation.

It is noteworthy that QE and the resulting lending attempt to stimulate the economy is effective only if individuals and commercial operations take loans and use them to spend and invest in the economy.

QE also can devalue the currency. It can help domestic manufacturers export goods (because the currency is cheaper), and anything that’s imported is more expensive. Consumers are hit with higher prices for imported goods, along with domestic producers using higher-priced imported raw materials for their final products.

With the economy still facing the headwinds of the COVID-19 pandemic, the Fed has played a major role in stabilizing the economy. While the increase of liquidity has certainly provided a lifeline for the markets, the price of gold can be seen as a hedge against this liquidity – with inflation as one potential outcome. For the rest of 2020, The Fed will be ready and able to assist the markets but will leave lingering questions about the value of the U.S. and other global currencies. 

How to Make the Most of Digital Marketing

4 min read

How to Make the Most of Digital MarketingDigital marketing is not a new phenomenon. However, new realities imposed by the COVID-19 pandemic have highlighted the importance of digital marketing for businesses. Basically, digital marketing revolves around using digital channels to advertise. Such channels include mobile devices, search engines, social media, websites, email, and others to help reach consumers. The purpose is to create a relationship with potential online customers to influence their buying decisions.

Why Digital Marketing

For starters, with digital marketing, you are able to personalize your marketing and target your ideal audience. It offers the ability to target an audience based on location, age, preference, and other specific details that define the intended consumer of your product or service. In the end, you don’t waste money on audiences that might not even buy your product or service.

With the availability of artificial intelligence, it’s easy to identify trends, carry out competitor research, and accumulate data that aid quick decision making. This kind of marketing is data-led. Considering that five to 10 hours of a person’s day is spent on the internet, this creates an opportunity to familiarize consumers with your brand and create relationships that lead to sales.

What’s more, chatbots are available on business websites or social media accounts to answer customer questions even when the business is closed. This means a customer visiting your page does not leave without some information that could help in their purchasing decision.

In addition to being able to expand your reach at a lower cost, your business can enhance brand loyalty by maintaining personal contact with clients even after making sales.

The best part of digital marketing is the ability to track the results of your marketing in real-time. 

How This Can Help Grow Your Business

First, digital marketing gives all businesses a fair share of the market. Today, a business can connect with customers cheaply over posts on social media.

What this means is that a business can instantly communicate with customers to inform them of their products or services and get instant feedback.       

Don’t ignore the fact that people today get information from the internet. A lot of purchase decisions start with an online search. A potential customer expects to find information regarding your products on a website, social media, or from reviews by other users.

Customers also want to determine if your business and products are a good fit for their needs.

In the event that they cannot locate your business, you will lose a potential client to a competitor.

A good online presence can help potential clients find you and possibly even become customers.

How to Get the Best of Digital Marketing

The good thing about digital marketing is that it will exist as long as people are using technology. The trick is to use strategies that help you stay ahead of the competition.

Digital marketing has been proven to be the best strategy to acquire new customers as well as maintain a relationship with existing customers.

One of the hard and fast rules about digital marketing is that no one strategy fits all businesses. Digital marketing is constantly changing – meaning that businesses have to make frequent changes to their strategies.

In order to stay ahead of the competition, you can take advantage of referral traffic as it gives credibility to your brand. This is possible by connecting with industry leaders in your niche.

You can’t afford to ignore analytics. Analytics help you discover what is working and what is not working.

Use high-quality content to draw the interest of potential customers. Sacrificing quality for volume can cost you potential leads.

Select social media platforms where your potential customers are likely to be. Understanding your target market will help you reduce the time and cost spent on digital marketing, as you will be able to follow your clients where they hang out.

Digital Marketing is the Way to Go

As long as the internet continues to grow, businesses have little choice but to get involved in digital marketing. Gone are the days when social media was considered merely a place to pass the time.

For some business owners, it might be challenging to know where and how to start, considering that digital marketing is quite an extensive field. The most important thing is to establish a goal for what you want to achieve. If not well done, it can cost your business a lot of unnecessary expense.

Relief and Funding for Human Rights, Emergency Aid, Cash-Flow Assistance and New Infrastructure Projects

Relief and Funding for Human Rights, Emergency Aid, Cash-Flow Assistance and New Infrastructure Projects

3 min read

Relief and Funding for Human Rights, Emergency Aid, Cash-Flow Assistance and New Infrastructure ProjectsLaw Enforcement Suicide Data Collection Act (S 2746) – This bill authorizes the establishment of a new Law Enforcement Officers Suicide Data Collection Program to be administered by the FBI. The program will gather data related to suicides and attempted suicides of current and former officers, as well as the wrongful detainment of U.S. nationals abroad. The purpose of the Act is to help understand and prevent law enforcement suicides. The bill was introduced by Sen. Catherine Cortez Masto (D-NV) on Oct. 30, 2019. It was passed by the House and the Senate in May and was signed into law on June 16.

Uyghur Human Rights Policy Act of 2020 (S 2744) – Sen. Marco Rubio (R-FL) introduced this legislation on May 14 as a means to condemn human rights violations of ethnic Turkic Muslims in Xinjiang. The bill calls for an end to the arbitrary detention, torture and harassment of these communities inside and outside of China. The Act was passed by both the Senate and the House in May and was signed into law by the president on June 17.

Hong Kong Autonomy Act (HR 7440) – Introduced by Rep. Brad Sherman (D-CA) on July 1, this legislation authorizes the president to sanction foreign individuals, entities and financial institutions that materially contribute to China’s failure to preserve Hong Kong’s autonomy in response to a written report to be submitted by the State Department each year. While the bill also gives the president the authority to waive or terminate sanctions, it permits Congress to override such an action by passing a joint resolution of disapproval. The Act was unanimously passed in Congress and signed into law by the president on July 14.

Emergency Aid for Returning Americans Affected by Coronavirus Act (S 4091) – This bill was introduced by Sen. Chuck Grassley (R-IA) to amend section 1113 of the Social Security Act. The Act authorizes funding for fiscal year 2020 in order to increase payments for temporary assistance to U.S. citizens and their dependents who return from foreign countries due to the COVID-19 crisis and are without available resources. The legislation enables the Department of Health and Human Services to provide monetary payments and medical care on a temporary basis. The Act was introduced and passed in both the House and Senate on June 29 and signed into law on July 13.

Protecting Nonprofits from Catastrophic Cash Flow Strain Act of 2020 (S 4209) – This bill is designed to improve emergency unemployment relief for governmental entities and nonprofit organizations by amending Title IX of the Social Security Act. The bill was introduced by Sen. Tim Scott (R-SC) on July 2. It was passed in the House and in the Senate on July 9, and is currently awaiting signature by the president.

Moving Forward Act (HR 2) – On June 11, this Act was introduced by Rep. Peter Defazio (D-OR). This bill would authorize funding for federal highways, highway safety programs and transit programs. It also addresses climate change strategies to reduce weather impacts on surface transportation by conducting a vulnerability assessment and recommending ways to enhance resilience for highways, mass transit and rail. The bill would allocate a grant program to help improve the safety, state of good repair and connectivity of transportation infrastructure in rural communities. It also directs the Department of Transportation to establish a pilot program for a national motor vehicle per-mile user fee to restore and maintain the long-term solvency of the Highway Trust Fund to uphold a state of good repair for the future. The bill passed in the House on July 1 and is currently in the Senate, where it enjoys considerable bipartisan support for infrastructure projects.

IRS Gears Up for Aggressive Enforcement

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IRS Gears Up for Aggressive EnforcementRecently, the IRS Commissioner testified before the Senate Finance Committee, sending the message that the IRS is committed to catching intentional tax evaders. There was no ambiguity in the message of his testimony to Congress; he noted that under his watch, the IRS will aggressively pursue those purposely evading their tax obligations with civil and criminal enforcement. The commissioner made sure to mention that those who were not defrauding the system intentionally had nothing to worry about; they are not the target of stepped-up enforcement.

The IRS will be targeting five major enforcement initiatives:

  1. Technology – The IRS will put a new focus on their use of technology as an enforcement tool; specifically, advanced data and analytical strategies. With this data-driven approach, the IRS believes it will be able to catch tax fraud impossible to spot even just a few years ago.
  2. Offshore Tax Evasion – Offshore tax reporting enforcement is a long-standing priority of the IRS, but the current commissioner reiterated the focus on this area, so don’t expect to see any easing here.
  3. Tax Shelters – The IRS believes many taxpayers are abusing two tax shelters, syndicated conservation easements, and micro-captive insurance arrangements. They plan on stepped-up enforcement on both those who arrange these shelters and taxpayers who participate in them.
  4. Cryptocurrency – The IRS believes there is mass non-compliance in the world of cryptocurrencies through either underreporting or nonreporting of taxable transactions.
  5. Wealthy Taxpayers – Enforcement actions take time and are resource-intensive, so it should be no surprise that the IRS is going after non-compliant taxpayers with the biggest ROI. The IRS is considering anyone with an income level of over $100,000 to be high-income. 

Expect to see increased tax enforcement efforts ahead, with a focus on those who are intentionally evading the system. If you haven’t purposely defrauded the system, you have little to worry about.