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[TSP_Strategy] Which Fed Localities Will Receive Largest Pay Raises in 2016?

[TSP_Strategy] Which Fed Localities Will Receive Largest Pay Raises in 2016?

 

Bay Area, D.C. Feds to Receive the Largest Pay Raises Next Year

4:39 PM ET

The Obama administration on Monday unveiled the exact adjustments to base salaries employees in each locality pay area will receive in 2016, with the largest increases concentrated in major American cities.

The first adjustments to locality pay since 2010 will rope about 108,000 federal employees into a specific locality area -- rather than the "rest of United States" designation -- for the first time, though the employees in existing localities will see the biggest raises next year. The adjustments will increase the total federal payroll by 0.3 percent, according to a letter sent to Congress by President Obama on Monday.

The increased locality pay rates will come on top of the third consecutive year in which base pay will grow by 1 percent.

California's Bay Area, including San Francisco, Oakland and San Jose, will see the largest increase next year, with the locality rate increasing 0.6 percentage points. Employees in other California cities including Los Angeles and San Diego, as well as those in New York City, N.Y., and Washington, D.C., will receive increases between 0.5 and 0.6 percentage points. The adjustment in the capital area will jump 0.56 percentage points to 24.78 percent of an employee's base salary.

The vast majority of existing localities will see their adjustments increase between 0.2 and 0.4 percent.

The administration recently finalized its plan to create 13 new locality areas: Albany, N.Y.; Albuquerque, N.M.; Austin, Texas; Charlotte, N.C.; Colorado Springs, Co.; Davenport, Iowa; Harrisburg, Pa.; Kansas City, Mo.; Laredo, Texas; Las Vegas, Nev.; Palm Bay, Fla.; St. Louis, Mo.; and Tucson, Ariz.

The pay adjustments for those areas range from just above the new "rest of U.S." rate of 14.35 percent (Albuquerque, N.M.'s 14.37 percent) to Laredo, Texas' 14.59 percent.

A full list of the locality rates can be found here.

The Office of Personnel Management has also changed the boundaries of the locality areas in 21 of the 33 existing regions to increase the number of employees receiving the larger salary bump.

"Civilian federal employees have already made significant sacrifices as a result of 3-year pay freeze that ended in January 2014," Obama wrote in his letter, adding that the 1 percent raises in 2014 and 2015 were "lower than private sector pay increases."

However, Obama wrote, "as the country's economic recovery continues, we must maintain efforts to keep our nation on a sustainable fiscal course. This is an effort that continues to require tough choices."

Obama said the statutory formula for determining locality pay, which presidents historically ignore in favor of their own rates, would have boosted the adjustments by an average of 28.74 percent at a cost of $26 billion.

"Federal agency budgets cannot sustain such increases," he said.

The new rates will go into effect on the first pay period in the new year, Obama ordered, and explained they "will not materially affect our ability to attract and retain a well-qualified federal workforce."

OPM issued a final rule implementing the new pay areas in October, following the guidance of the Federal Salary Council and the President's Pay Agent. Obama has received criticism from federal employee advocates for giving historically low across-the-board raises to base pay in recent years -- following three years of no raises at all -- and the new locality pay areas and definitions provide the administration with a different avenue for increasing feds' compensation. The salary council, made up of labor union representatives and pay experts, has for years clamored for new localities.

"While the locality increase is quite small, averaging 0.3 percent," said American Federation of Government Employees President J. David Cox, "this is a welcome recognition by the administration that federal employees have more than paid their share of helping to reduce the nation's deficit and cannot endure another year of frozen wages." Cox and National Treasury Employees Union Tony Reardon called on Congress to pass a larger base pay raise than called for by Obama.

(Image via Kent Weakley / Shutterstock.com)


4:39 PM ET

http://www.govexec.com/pay-benefits/2015/11/bay-area-dc-feds-receive-largest-pay-raises-next-year/124056/

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Posted by: sarah_oz@yahoo.com
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Neither the TSP Strategy group, nor individual members, are licensed or authorized to provide investment advice. Any statements made herein merely reflect the personal opinions of the individual group member. Please make your own investment decisions based upon your personal circumstances.

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[TSP_Strategy] Tech Talk

[TSP_Strategy] Tech Talk

 


The S&P 500 Index added 0.94 (0.04%) last week.

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Percent of S&P 500 stocks trading above their 50 day moving average increased last week to 70.80% from 69.80%.

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Percent of S&P 500 stocks trading above their 200 day moving average increased last week to 53.00% from 52.60%.

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Bullish Percent Index for S&P 500 stocks increased last week to 68.80% from 67.00%

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The Dow Jones Industrial Average slipped 25.32 points (0.14%) last week.

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Bullish Percent Index for Dow Jones Industrial Average stocks remained unchanged last week

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Bullish Percent Index for NASDAQ Composite stocks increased last week to 51.67% from 49.70%

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The NASDAQ Composite Index gained 22.60 points (0.44%) last week.

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The Russell 2000 Index gained 27.23 points (2.32%) last week.

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The Nikkei Average gained 4.13 points (0.02%) last week.

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The Shanghai Composite Index dropped 194.20 points (4.35%) last week.

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Currencies

The U.S. Dollar Index added 0.50 (0.50%) last week.

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The Euro dropped 0.51 (0.48%) last week.

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Gasoline jumped $0.07 per gallon (5.51%) last week.

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Crude oil slipped $0.19 per barrel (0.45%) last week.

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Natural gas dropped $0.08 per MBtu (3.50%) last week.

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Gold dropped $20.10 per ounce (1.87%) last week.

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Silver lost $0.05 per ounce (0.35%) last week.

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Platinum dropped $20.10 per ounce (2.35%) last week
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Palladium dropped $9.30 per ounce (1.66%) last week.

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Interest Rates

Yield on 10 year Treasuries dropped 3.7 basis points (1.64%) last week.

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Conversely, price of the long term Treasury ETF gained $0.52 (0.43%) last week.

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The VIX Index dropped 0.63 (4.00%) last week.

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Posted by: sarah_oz@yahoo.com
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Neither the TSP Strategy group, nor individual members, are licensed or authorized to provide investment advice. Any statements made herein merely reflect the personal opinions of the individual group member. Please make your own investment decisions based upon your personal circumstances.

.

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[TSP_Strategy] Re: 25 basis points

[TSP_Strategy] Re: 25 basis points

 

I agree with your analysis. S fund should be least affected.

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Posted by: sarah_oz@yahoo.com
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Neither the TSP Strategy group, nor individual members, are licensed or authorized to provide investment advice. Any statements made herein merely reflect the personal opinions of the individual group member. Please make your own investment decisions based upon your personal circumstances.

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[TSP_Strategy] 25 basis points

[TSP_Strategy] 25 basis points

 

If the Fed moves in December, with a 25 basis point increase, which index funds under the TSP will be most affected?

I believe the I and C fund will suffer the most due the strengthening of the dollar and making Large Cap companies, with a large majority of their sales being outside the US, making their products sold overseas more expensive.

But what about the Mid-Caps and the Small-Caps in the S fund? Will the rate increase stifle their borrowing needs, or will the banks be more willing to offer loans due to the fact they can charge more for business loans?

Any thoughts?

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Posted by: Dwight Waterman <dwight.waterman@yahoo.com>
Reply via web post Reply to sender Reply to group Start a New Topic Messages in this topic (1)
Neither the TSP Strategy group, nor individual members, are licensed or authorized to provide investment advice. Any statements made herein merely reflect the personal opinions of the individual group member. Please make your own investment decisions based upon your personal circumstances.

.

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[TSP_Strategy] Bloomberg Commodity Index

[TSP_Strategy] Bloomberg Commodity Index

 

Bloomberg Commodity Index

Chart of the Week for November 27, 2015 - December 3, 2015

Commodity prices, as represented by the Bloomberg Commodity Index, have fallen 36.55% since April 2014.

The Bloomberg Commodity Index is composed of twenty-two exchange traded futures for physical commodities, grouped into five sectors. As of October 30, 2105, the five sectors covered by the index were Energy, Agriculture, Industrial Metals, Precious Metals, and Livestock. Of the twenty-two futures included, as of October 30, Gold, Natural Gas, West Texas Intermediate Crude Oil, and Corn, were the four highest weighted individual commodities in the index.

As noted in the chart above, commodity prices have been generally falling over the past two years. After reaching a high of 137.80 in April 2014, the index closed at 87.43 on October 30, 2015, a decrease of 36.55%. Global growth has been slow to recover from the economic crisis of 2008-2009, and that has lowered demand for commodities while production of commodities have grown over that time. Recently, the slowing economic growth in China has been a major contributor to the decline in commodity prices, as China was a major importer of commodities when its economy was experiencing stronger growth.

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Posted by: sarah_oz@yahoo.com
Reply via web post Reply to sender Reply to group Start a New Topic Messages in this topic (1)
Neither the TSP Strategy group, nor individual members, are licensed or authorized to provide investment advice. Any statements made herein merely reflect the personal opinions of the individual group member. Please make your own investment decisions based upon your personal circumstances.

.

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[TSP_Strategy] Recoup Savings During Open Season

[TSP_Strategy] Recoup Savings During Open Season

 

Recoup Some Savings During Open Season

5:00 AM ET

I hope that some of you have the day off and are recovering from a wonderful Thanksgiving holiday. If you are shopping today, then you must be looking for a bargain. You need look no further than your annual health benefits open season. There may not be an actual sale going on, but by spending some time studying your options, you may find enough savings to cover the cost of what you may have spent on Black Friday.

When shopping for health insurance there are many moving parts and many choices to make, which can make this a complicated and frustrating exercise. It reminds me of Aesop's fable about a cat and a fox. As a pack of dogs goes after the cat and the fox, the fox selfishly refuses to share with the cat the numerous ways to escape. The cat knew only one means of escape -- to run up the nearest tree. As the fox contemplated the hundreds of options, the dogs arrived and tore the poor fox to pieces. The lesson for health insurance shoppers? Don't become paralyzed by all the options.

There are other psychological reasons why we are resistant to change. One is  information overload. Psychologist Barry Schwartz describes the Paradox of Choice as a condition that causes anxiety and reduces happiness. According to Schwartz, there are ways that we can simplify and reduce that choice-driven anxiety. Let's apply his principles to choosing the best health plan!

Step One:  Figure out your goals.

Find the best health plan for your budget and for each option, determine the following:

  • What are the premiums?
  • Does the plan have a deductible?
  • What are the copays and coinsurance amounts?
  • Does the plan offer a Health Fund or Health Savings Account?
  • What is the catastrophic limit on your out of pocket expenses and are there restrictions?
  • Does the plan have a preferred provider network or does it require that you use network providers?

Find the best health plan for your health (and family) based on pre-existing conditions.

Consider tax advantages of flexible spending accounts and health savings accounts.

If part of a federal couple (two federal employees, retirees or one of each), factor this into your considerations.

Consider the need to change from self and family enrollment to the new self plus one enrollment.

Consider whether you will need dental and vision supplements and review those plans.

Define any changes you want to make and write them down.

Step Two:  Evaluate the importance of each goal.

  • Is saving money important more important than the time it will take to evaluate the choices?
  • What are the obstacles to making a change?
  • What are the benefits of making a change?
  • Are there health issues that will limit the choice of plan?
  • Do you need more education on the tax issues surrounding your choices?
  • Federal couples can take advantage of two self only plans if there are no dependent children.
  • Federal couples where one spouse is retired and the other is working may have a tax advantage if the working spouse carries the health insurance. This may also allow a delayed enrollment in Medicare Part B without incurring a penalty.
  • The new option for 2016 is self plus one; what is the impact of making this change if you are part of a family of two (you and a spouse or a dependent child)?
  • Put a numerical rating on the importance of your choices.

Step Three:  Array the options.

You don't have hundreds of options, but you do have a dozen or more. Here is a link to the list of plans available where you live:  

Some plans offer a high option, standard option, value option, consumer driven option and a high deductible option. Do you understand the difference? This is key to making the best choice. Here are some definitions.

I presented a webinar last month for www.ltcfeds.com titled, "FEHB, FEDVIP, FEGLI, FLTCIP, FSAFEDS, and ... BENEFEDS?" where these terms were discussed. Use a comparison tool to help decide:  

Step Four: Evaluate how likely each of the options is to meet your goals.

  • Do you need more information? Go back to the earlier steps
  • You may also need to contact representatives of the plan(s) you are considering to ask additional questions. The phone numbers are available in each plan brochure or at the plan's web site.  
  • Make a list of the pros and the cons of each choice.

Step Five:  Pick the winning option.

  • If the option is different from your current coverage, you will need to take action.
  • The Office of Personnel Management has provided information for employees and retirees who need to make an open season change.   

Step Six:  Modify goals.

Open season will end on Dec. 14. Don't wait until the last minute or your fear and anxiety over the paradox of choice will increase. Remember, you can always make another change next year.

(Image via Miroslav Hlavko/Shutterstock.com)


5:00 AM ET

Recoup Some Savings During Open Season


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Posted by: sarah_oz@yahoo.com
Reply via web post Reply to sender Reply to group Start a New Topic Messages in this topic (1)
Neither the TSP Strategy group, nor individual members, are licensed or authorized to provide investment advice. Any statements made herein merely reflect the personal opinions of the individual group member. Please make your own investment decisions based upon your personal circumstances.

.

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[TSP_Strategy] Hey! I am so...

[TSP_Strategy] Hey! I am so...

 

...thankful for this group of fellow travelers -and here's to Sara! 


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Posted by: sfeverett@yahoo.com
Reply via web post Reply to sender Reply to group Start a New Topic Messages in this topic (1)
Neither the TSP Strategy group, nor individual members, are licensed or authorized to provide investment advice. Any statements made herein merely reflect the personal opinions of the individual group member. Please make your own investment decisions based upon your personal circumstances.

.

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[TSP_Strategy] How Stocks Perform Around Thanksgiving

[TSP_Strategy] How Stocks Perform Around Thanksgiving

 


Opinion: How stocks perform before and after Thanksgiving

Published: Nov 24, 2015 5:12 a.m. ET

A top-performing stock-timing model says the market is likely to rise

CHAPEL HILL, N.C. (MarketWatch) — Odds are in stock investors' favor between now and the end of next week.

I say this not because I believe in the so-called Santa Claus Rally, an urban myth that I tried to debunk a couple of weeks ago.

The basis of my confidence is the stock-market-timing model that has one of the best long-term records of any monitored by the Hulbert Financial Digest (HFD): the so-called Seasonality Timing System created in the 1970s by Norman Fosback. Fosback, who at the time was president of the Institute for Econometric Research, currently edits an investment-advisory service called Fosback's Fund Forecaster.

Not only has Fosback's model performed better than any other market-timing system the HFD has tracked over the past three decades, but it also is the simplest. It is entirely mechanical, based on nothing more than the calendar. The rest of this week and all of next should benefit from the convergence of the two seasonal patterns on which his model is based: strength around the turns of the month and before exchange holidays.

If it sounds too easy, consider this: According to the HFD's calculations, a portfolio that invested in the Wilshire 5000 index on the minority of days deemed to be seasonally favorable and which otherwise earned the 90-day Treasury bill rate, produced a 10.5% annualized gain between 1982 (when the HFD commenced coverage) and the end of this past October.

A buy-and-hold strategy over the same period would have gained slightly more — 11.3%, or 0.8 percentage point more a year. But that's an unfair comparison, since Fosback's model calls for being invested in the market for less than half the time. And 0.8 percentage point a year is a small price to pay for cutting risk by more than half.

Qualifications

Before you rush out and bet heavily on a short-term trade, however, bear in mind that there are no guarantees. Though the stock market has a well-above-average chance of rising over the next two weeks, it still could decline.

Since 1896, for example, when the Dow was created, the stock market has risen about two-thirds of the time over the period beginning two days before Thanksgiving and lasting until the end of December's first week. That's markedly better than the 54% odds of rising that prevail on all other comparable periods in the market, but it still means that stocks fall one out of three times over those pre- and post-Thanksgiving sessions.

If you really are serious about exploiting these seasonal patterns, you will need to bet on them consistently over many years. Your situation is not dissimilar to the odds a good blackjack player faces: By being a shrewd card counter, he can perhaps increase his chances of winning a given hand to 55%, from below 50% for a non-card-counter. Notice that this card counter's odds of success when playing a single hand are still hardly better than a coin flip. However, by playing a sufficient number of hands, the odds of coming out a winner become closer to 100%.

Something similar may apply to the Seasonality Timing System. Your odds of success in any given instance may be statistically significant, but still not high enough to justify throwing caution to the wind. That's why followers of the Seasonality Timing System need to follow it with discipline and patience over many years.

In any case, notice that there are good odds that our portfolios will be fatter in two weeks than they are today — just like our waistlines!


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Posted by: sarah_oz@yahoo.com
Reply via web post Reply to sender Reply to group Start a New Topic Messages in this topic (1)
Neither the TSP Strategy group, nor individual members, are licensed or authorized to provide investment advice. Any statements made herein merely reflect the personal opinions of the individual group member. Please make your own investment decisions based upon your personal circumstances.

.

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