Tuesday, January 24, 2017


January 18,2017
the staff of the Ridgewood blog

Ridgewood NJ, our friends at Park Wealth Management reminded us that the Economist invented the Big Mac index in 1986 as an entertaining way to assess whether currencies were at the “correct” levels. The index reflects the idea that countries’ exchange rates should balance so the same product (in this case, a hamburger) costs the same in two different countries when the price is denominated in the same currency. After updating the index on January 11, 2017, The Economist reported the “all-meaty” dollar was stronger than usual: “The dollar is now trading at a 14-year high in trade-weighted terms. Emerging-world economies may struggle to pay off dollar-denominated debts. American firms may find themselves at a disadvantage against foreign competition. And, American tourists will get more burgers for their buck in Europe.”

A Big Mac in the United States cost about $5.06 last week. In the Euro area, the price was about $4.06 and in Britain $3.73. A Big Mac is cheapest in Russia ($2.15) and most expensive in Switzerland ($6.35). Here are the prices of a Big Mac (a.k.a. the Maharaja Mac in India) in a few other locales:

It should be noted the Big Mac index is not a perfect measurement tool. The price of a burger should be less in countries with lower labor costs and more in countries with higher labor costs.

When prices are adjusted for labor (using gross domestic product per person), the Brazilian real is the world’s most overvalued currency, followed by Pakistan and Thailand. The most undervalued currencies include Egypt, Malaysia, and Hong Kong.

Park Wealth Management is located at 216 East Ridgewood Ave , 2nd Floor Ridgewood NJ 07450 201 689-2020

Saturday, January 14, 2017

House Acts to Requires Cost Benefit Analysis of all SEC Regulations

January 13,2017
the staff of the Ridgewood blog

WASHINGTON - The House approved bipartisan legislation on Thursday to ensure that the benefits of proposed regulations from the Securities and Exchange Commission (SEC) justify the costs to jobs, economic growth, and capital formation.

The SEC Regulatory Accountability Act, sponsored by Financial Services Committee member Rep. Ann Wagner (R-MO), passed 243-184.

“Ill-advised laws like the Dodd-Frank Act empower unelected, unaccountable bureaucrats to callously hand down crushing regulations without adequately considering what impact those regulations have on jobs,” said Committee Chairman Jeb Hensarling (R-TX). “The true cost of Washington red tape includes the jobs not created, the small businesses not started and the dreams of our children not fulfilled.”

Under the bill, before issuing a regulation the SEC will be required to:

identify the nature and source of the problem its proposed regulation is meant to address; utilize the SEC’s Chief Economist to assess the costs and benefits of a proposed regulation to ensure the benefits justify the costs; identify and assess available alternatives; and ensure that any regulations are consistent and written in plain language.

Further, the legislation requires the SEC to engage in a retrospective review of its regulations every five years and conduct post-adoption impact assessments of major rules.

Thursday, January 05, 2017

Consumer confidence climbed in December to the highest level in 13 years

December 28,2016
the staff of the Ridgewood blog

Ridgewood NJ, Consumer confidence climbed in December to the highest level since August 2001. Americans were more upbeat about the economic outlook than at any time in the past 13 years, according to a report Tuesday from the New York-based Conference Board.