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Are you LinkedIn®? Do you Spoke®, Twitter®, Jigsaw® or QAlias®? In 2009, will you get a Second Life®?

If these social networking concepts are not in your leadership development radar, you are ignoring a dynamic trend that could have a profound impact on key areas of your business such as profitable revenue growth, high performance teaming, high potential talent acquisition and development, global expansion and operational efficiency and effectiveness.

Wikipedia defines a social network service as one that focuses on the building and verifying of online social networks for communities of people who share interests and activities. The concept of Social Network Analysis (SNA) – the intersection of several key disciplines including sociology, anthropology, psychology, organizational design and graph theory – has existed in academic circles since the 1930s and 1940s. Although interesting, the study of patterns in human interaction has unfortunately been confined to academia with little visibility or application to corporate leaders and their efforts in not only strategy formulation, but strategy execution as well.

In many leadership circles and boardrooms, there is seldom a shortage of organizational mission, vision, strategy, values or beliefs. (What I often refer to as “wall art.”) But where it consistently breaks down is when dealing with concepts such as the strategic relationship dashboard, strategic relationship initiatives, and personal relationship development action plans – all of which lead to strategic relationship outcomes and a leadership development imperative.

Strategic Relationship Planning™ is driven by a core set of questions around critical organizational business goals including the identification of the most relevant and strategic relationships we need, critical relationships we already posses within and external to our corporation today – one’s Relationship Bank, and a plan to systematically, intentionally, and strategically add value to the social network we currently have to create leverage with the relationships we need. Leading others through this process is consistent with what we believe to be the single most valuable asset current and future leaders must possess – the ability to engage and influence others, often without authority!

This dynamic favor economy is the core motivator of the 30 million users in over 170 industries that have converged on a single online platform that didn’t exist until only a few years ago.

Although many leaders have heard of LinkedIn, there are still many who are either under the impression that it is a fad that will simply go away or that it has little bearing on them personally or professionally. What they neglect to realize is that every one of the Fortune 500 companies have director-level profiles and higher on LinkedIn. Even president-elect Barack Obama teamed up with LinkedIn and a dozen other social networking site to reach young voters as well as entrepreneurs, small business owners and executives, asking them very pointed questions regarding their needs from the next U.S. president.

So, what can an executive learn from LinkedIn and other social networking platforms? Here are the Top 5 lessons:

1. The exponential value of a highly decentralized organization. Although your corporate organizational chart may control chaos and illustrate command and control, many organizations are attempting to control a dynamic 21st century workforce with a WWII organization model. By extending the organization’s reach beyond the traditional four walls, you exponentially extend and expand the organization’s learning and growth elasticity, often through informal learning.

2. Corporate Relationship Deficit Disorder. By design, traditional organizational charts tend to create geographic, functional, and project-based silos that are not conducive to collaboration, communication and shared best practices. One thing that SNA has consistently proven is that knowledge management is not a system but a process.

3. Adaptive Innovation™. An organization’s most valuable talent simply cannot be creative in isolation. The ability to leverage highly communal experiences such as Second Life, particularly with geographically dispersed teams, nurtures the necessary DNA for a team or organization to adapt its business model to a constantly evolving market.

4. Flight Risk™. Stifle the creativity of the 20 and 30-year olds, and your most valuable talent will leave in the next 12 months. As reciprocal loyalty continues to decline, leaders must find ways to align the personal objectives of key individuals with those of the organization to get things done.

5. Social networks as accelerants of your brand equity. Beyond the measurement analysis of your hard assets, the next evolution is one of leveraging the corporation’s soft assets. Social networks, by definition, encompass the three most critical examples of such soft assets: 1) People, continuously proving to be any organization’s sustainable differentiator, 2) Relationships, as an individual, team or organization’s most valuable asset across an ongoing trust continuum, and 3) Brand, that which time after time creates sustainable loyalty and continued investment in any organization from employees, suppliers, customers and shareholders.

As a leader, you can pretend that MySpace and Facebook are for “kids,” LinkedIn and Second Life are simply “fads,” and that the status quo will suffice, or you can embrace social networking as a strategic, intentional, and thus quantifiable asset in driving profitable revenue growth, winning the global war on talent, and the constant evolution and integration of highly optimized global processes.

So I ask you again – what is your social networking leadership strategy? Contact us for our Top 10 Questions to Ask about Social Networking from Your Leadership Development Program.

© 2008 All Right Reserved Worldwide. The Nour Group, Inc.

David Nour is a social networking strategist and one of the foremost thought leaders on the quantifiable value of business relationships. A native of Iran, David came to the U.S. with a suitcase, $100 cash, limited family ties and no fluency in English! Fast forward 25 years and he has built an impressive career of entrepreneurial success, both within large corporations and early stage ventures. David is the author of Relationship Economics (Wiley, 2008), a senior management advisor, and a featured speaker for corporate, association and academic forums, where he shares his knowledge and experience as a catalyst for Relationship Economics® – the art and science of relationships. To learn more, please visit: www.relationshipeconomics.NET or call 404-419-2115.

The only thing that can help resolve that anxiety is for us to do the work in our inner world, the world of our psyche and soul, to discover, explore, heal, improve our relationship with money. In other words, we may make many changes in our lives right now. We may make the simple things most important; we may expand our attention to our relationships; we may make savings an even more important priority; we may become clearer than ever before about the distinction between investing and saving. But the things we do in the outer world cannot be sustained without our also doing things in our inner world that bring about healing and transformation. In fact, without our even realizing it, the things in our unconscious that we ignore, discount, don’t tend to, will drive us and even undermine us. This is why healing our relationships with money is the most crucial step right now . . . because sustaining the changes we make in the outer world depends upon our healing in the world within us.

*******

In my 30 plus years as a psychotherapist, I have seen again and again that people’s relationship with money, at the root – beneath their awareness – is based on a young child’s thoughts, feelings, and decisions about money and about the things money symbolizes for them.
I have also seen repeatedly that when people are under stress, they regress to the thoughts, feelings, and perceptions of a child . . . even though they are not aware of it. They may not completely regress. They may not act on the regression. But they might.
If they act on the regression it may be blatant, or it may be very subtle. The most important thing to realize is that this happens in all of us, and it happens without our awareness. And whatever we do from the regressed place inside us – no matter how unconscious it is – has a huge impact on us individually and communally.
How many times have you seen a 6’2″ 250-pound CEO of a company fly into a rage at his employees when the business he owns and loves is losing money? How often in that situation have you – or has anyone else on the scene – realized that you were watching a “tantruming” two-year-old or even a raging baby in the body of a 42-year-old man?
So, here we are in a recession. People are under stress. They are regressing without even knowing it. The things they do may look adult, but they are often coming from the regressed child in them. They panic in response to the economic chaos, make poor decisions in relation to their resources – decisions that affect them personally and also the economy of our country and our world. This feeds a vicious cycle . . . because when things get worse, people panic and regress even further.
If the CEO above were to come to my office to work with this, one of the paths I would take with him would be to explore his relationship with money. It obviously isn’t that of an adult.
Let’s walk through a shortened version so you get a taste of the depth and breadth of the potential in this work. *

John comes to my office with $1,000 in cash. After preparing him for the work – in both previous sessions and at the start today – I ask him to hold the money in his hands and talk to it. He begins.
“I want you. I need you. I can’t get enough of you. I’m starving for you. I’m desperate for you. I’ll never have enough of you. Never. There’s no way out.”
He stops, turns and looks at me, and starts crying.
He looks away. Covers his

(continued)
Click here for Part 2 of 2

Judith Barr has been a depth psychotherapist in private practice since 1975, now practices in Brookfield, CT, and has earned an M.S. in Counseling and licensure as a Mental Health Counselor in Florida, New York, and Connecticut. She is an affiliate member of NAPFA (The National Association of Personal Financial Advisors), and has written for the NAPFA professional journal. In addition to sessions, consultations, and workshops, Judith informs, inspires, and invites people into their own awareness and healing through her book, Power Abused, Power Healed , her speaking engagements, media interviews, and many articles in print online and off. She can be contacted at judithbarr@powerabusedpowerhealed.com.

by Richard Kohan
Partner, Private Company Services/Personal Financial Services

The use of trusts offers asset protection for children as well as many other ways to reduce taxes while providing for and protecting your family members or others and, at the same time, allowing you to set initial parameters regarding the management of those assets.

There are several types of trusts. For effective gift planning purposes in the current low value/low interest environment, we will focus here on two types of irrevocable trusts—grantor trusts and non-grantor trusts. This can be confusing, since both are funded by a grantor (the person establishing the trust) and both are irrevocable, meaning the terms cannot be changed and any assets held by the trust should be excluded from the estate of the person funding the trust (assuming the terms are drafted correctly). Both are subject to gift tax upon funding (although the planning techniques discussed below are designed to reduce or eliminate actual gift tax). The difference is that a grantor trust is set up so that the person funding the trust is responsible for income taxes on the earnings of the trust (a benefit for wealth transfer planning) and a non-grantor trust is responsible for income taxes on its earnings.

Sophisticated versions of these trusts can generate impressive wealth tax savings, particularly when values and interest rates are low. Some of these include:

Grantor retained annuity trust (GRAT)s. With a GRAT, the grantor transfers highly appreciating property into a trust while retaining an annuity stream for a stated period of years. At the expiration of the term, the property remaining in the trust is transferred to the beneficiaries. Because the grantor retains an annuity stream GRATs particularly appeal to people who are cautious about giving away wealth now.

The transfer of assets to the GRAT creates a taxable gift equal to the fair market value of the assets less the actuarially determined present value of the retained annuity stream. To the extent that the amount actually transferred as the remainder interest exceeds the value calculated for gift tax purposes, the excess is transferred gift tax-free. At the end of the GRAT term, the remainder interest that passes to heirs is completely out of the grantor’s estate. Because the present value of the remainder interest is calculated based on the interest rate at the time the trust is established, GRATs can be especially effective during periods of low interest rates.

Intentionally defective irrevocable trust (IDIT)s. Because an IDIT is considered a grantor trust for income tax purposes, the grantor pays the tax on income within the IDIT, increasing the after-tax trust value to the ultimate beneficiaries (as with a GRAT). However, an IDIT is structured so that its assets will not be included in the grantors estate for federal estate tax purposes. This split feature gives rise to various planning opportunities, such as a sale to an IDIT, which are particularly attractive when values and interest rates are low.

With a sale to an IDIT, the grantor makes a cash gift to the trust and also sells assets (e.g., closely-held stock) at fair market value to the trust in return for a promissory note bearing interest at the Applicable Federal Rate. (A cash gift to a new trust can be avoided if the family structure already includes a grantor trust with assets that can support the required promissory note.) As with a GRAT, appreciation (and cash flow) of the property sold, in excess of the interest rate charged on the note (or the GRAT Internal Revenue Code section 7520 rate), passes to heirs free of transfer tax. The grantor does not recognize gain or loss in connection with the sale of property to the trust in exchange for a note (or funding of GRAT). The grantor is not taxed on the interest the grantor receives on the note (or the GRAT annuity payments). The grantor indirectly retains an element of cash flow from assets sold to the trust. And, the grantor’s payment of the trust’s income tax liability is not considered to be an additional gift to the trust beneficiaries.

Dynasty trust. These are irrevocable trusts designed to pass assets through multiple generations at a reduced transfer tax cost. They have a perpetual existence and assets owned by the trust should not be includible in anyone’s estate until the trust is terminated. Grantor trust rules allow the settlor to pay the income taxes on behalf of the trust during his/her life, which further benefits future generations by allowing trust assets to grow tax-free. Further, dynasty trusts may provide creditor protection and may not be subject to marital claims. Kohan points out that an IDIT is a great trust to set up as a dynasty trust.

Want to know more about current wealth transfer opportunities?
Please contact:

Richard Kohan
Partner, Private Company Services/Personal Financial Services
617-530-7461
richard.kohan@us.pwc.com

Or visit www.pwc.com/pcs to locate the PricewaterhouseCoopers contact nearest you.

By Richard Kohan, national partner-in-charge of PricewaterhouseCoopers’ Private Company Services High Net Worth Individual practice

Although every day lately seems to bring yet another morsel of negative economic news, wealth planning is one area in which you can benefit from the economic downturn. Today’s depressed values and low interest rates provide significant opportunities for private business owners to reduce gift and estate taxes by formulating or rethinking gifting strategies. In an otherwise difficult economic environment, this is one opportunity worth exploring.

The primary purpose of estate planning is to be sure that you, not the state, direct how your assets are distributed. Estate planning allows you to provide for family security, business succession, the liquidity of your assets and the capable management of those assets. Another—but secondary—goal of estate planning is to eliminate or reduce federal and state income and transfer taxes. The real tax savings for high net worth individuals comes from lifetime giving, by giving away assets before they appreciate further. Thus, gift planning is the key to optimal wealth transfer planning. Done properly, wealth transfer planning ensures that assets pass to family, charities and other intended beneficiaries at the lowest transfer tax cost possible. Overlooked, it can leave an inheritance largely lost to taxation and legal fees.

Because privately-held companies are valued differently than public ones, different transfer planning opportunities exist. Various valuation discounts may be available, as well as unique treatment of the value of the business upon the death of the owner. There are also unique liquidity issues that arise when a significant portion of the total value of an estate is considered an illiquid asset.

Consider your own lifetime needs, as well as your giving philosophy
An appropriate wealth transfer plan for private company owners blends personal, financial and tax considerations into a comprehensive family wealth transfer plan and business succession plan that preserves a family’s wealth for the individual and his or heir heirs. An effective plan will meet your objectives, whether those objectives are to increase the benefits of ownership and assets, distribute assets to family members or charities, appoint capable estate managers as executors and trustees, reducing taxes, probate and administrative costs, and/or ensure the estate’s liquidity and stability.

Before taking advantage of today’s opportunities, private company owners should take certain essential preliminary steps. The first step is to assess your own personal lifetime needs. Before giving away assets, you need to set aside enough income and assets to meet your expected needs over your life expectancy. Then add a meaningful cushion to that figure. Given all the uncertainties in today’s economic environment, it’s not clear how long or deep the current slump will be. Moreover, there are longer-term concerns about housing and job security, not to mention issues such as the effect of energy policy. Thus, uncertainty needs to take a primary role in planning. What if there is another market collapse in the future? Consider also that an individual’s future medical needs are highly unpredictable—what if health care benefits are lost or there is a catastrophic illness?

Once you are comfortable that your own lifetime needs have been met, excess assets can be considered fertile ground for transfer planning. There may be good tax reasons to gift assets. But don’t let taxes drive your wealth transfer plan. First, consider your life philosophy and family system. How much control over assets do you want to retain? How much flexibility? Do you want to define specific terms? Will the trustee have a high or low level of flexibility?

Also, do you want creditor—and “predator”—protection for designated beneficiaries? Particularly if you will be giving away significant wealth, you will want to consider, for example, the consequences of a gift to a child or other beneficiary who may face a bad marriage, has money management or other difficulties, or who might be talked into a bad investment idea.

You will also want to consider your charitable giving philosophy and desires. “For example, what is your desired balance between gifts to children and charities? Also, remember that if you give money away now, you have lost the ability to drive charitable giving from that asset. While you control assets, you direct how your family uses or enjoy them. If you give assets away during your life to a specific charity, the asset is gone and in the charity’s control. This is not necessarily a bad thing. The real question may be whether you want to make direct gifts to charity year by year, or if you would be better off setting up a private foundation or a donor-advised fund that would dole out money to charity over time, allowing children or other family members to participate in timing and distribution decisions.

Part two of this series discusses the types of trusts that may be used in the current economy as part of an effective wealth transfer plan.

Want to know more about current wealth transfer opportunities?
Please contact:

Richard Kohan
Partner, Private Company Services/Personal Financial Services
617-530-7461
richard.kohan@us.pwc.com

Or visit www.pwc.com/pcs to locate the PricewaterhouseCoopers contact nearest you.

This could place many Americans into a tax bracket that is double or nearly double what they are currently paying. Combined with lower investment and real estate portfolio values and a declining economy, this could mean that many citizens have less than half or even less than a fourth of what they had planned to have during retirement.

There are some strategies to counteract the effect of this. Visit FentonReport and send an email asking for a free research report on the situation.

NEW YORK, NY May 17, 2007 — Investor Jim Rogers reveals bold opinions to strategist Bruce Fenton in an interview posted today on The Fenton Report (www.fentonreport.com) and YouTube.

“There is a staggering misconception about China about Japan, about Europe, about everywhere. Most Americans can’t even find Japan on a map…They can’t even find Oklahoma on a map,” says Rogers. “If the middle of Africa blew up we wouldn’t know about it for two or three weeks…the rest of the world might, but we wouldn’t,” says Rogers.

Rogers co-founded the Quantum Fund with George Soros, is an active investor and traveler. Trips totaling over 250,000 miles and 116 countries are chronicled in Rogers’s books Investment Biker and Adventure Capitalist.

“If travel makes one smarter, Jim Rogers may be the smartest person on earth. His insights and his uncanny track record make Rogers very worth listening to,” says Fenton, founder of Atlantic Financial, (www.atlanticfinancial.com), a global-focused wealth management company.

“Dubai is doing their best to become a center for the Middle East: for shopping, for finance, for technology, for everything else. As you know they have the best horse race in the world and the best golf tournament in the world and the best everything in the world,” says Rogers. “I have no idea if all these massive investments are going to pay off in the end. You might be a better judge of that since you’ve been there more recently. If it works, then clearly it will be great.”

Rogers’s latest book is, Hot Commodities “Before you get to work you use sugar, coffee, orange juice, rice, wheat, corn, rubber if you go running, wool, cotton silk, zinc, lead, gasoline. We know what this stuff is. It’s a lot easier to analyze commodities than it is stocks,” says Rogers.

“I’m afraid we’ll go the way of Great Britain, in 1918 they were the richest most powerful country in the world; their currency was the major world’s currency at the time…We’re sort of there too…over extended in every way and unfortunately I don’t see anything that’s going to change…you’ve already pointed out some of our shortcomings and that’s going to get worse, not better,” says Rogers. “Learn Chinese and start investing in commodities. Urge your clients to get their money out of the US Dollar.”

Originally published in The Fenton Report on March 29, 2004

In 2003, the federal government treated nearly 24 million families to a tax credit check. The U.S. Treasury mailed checks to many people who claimed the Child Tax Credit last year as an advance payment for the credit’s increase (tax law changes in 2003 increased the credit from $600 to $1,000 for qualifying families). The IRS used 2002 returns to determine qualified households. Qualifying children must have been born after 1986 in order to be eligible for the advanced payment.

However, to ensure that you do not believe in free lunches, the IRS is reminding taxpayers who plan to claim the credit on their 2003 federal income tax returns that they cannot claim the full $1,000 per child if they received an advance payment last year. Rather, the $400 advance must be subtracted from the credit amount computed for this year.

In the category of other news you can use from our tax authorities, the IRS recently issued new, relaxed guidelines for requesting a waiver of the 60-day deadline for IRA rollovers.

IRA owners may take a distribution from their IRA one time each calendar year without penalty or tax—as long as they get it back into the account within 60 days. Unlike Cinderella, whose coach turns into a pumpkin at midnight, your coach will be hit with tax and possibly a penalty if you are under age 59 ½ when you make this withdrawal and you don’t hit the deadline.

As we all know, sometimes even the best of intentions don’t allow us to make deadlines. For example, if you sent a check to a financial institution and they failed to get the money into your account in a timely manner, it’s too bad for you!

The new kinder, gentler IRS guidelines allow the IRS to consider “all relevant facts and circumstances,” such as whether financial institutions were late getting your check applied to the account, whether health reasons precluded you from acting in a timely manner, or whether “the dog ate the mail” and your payment disappeared. In any case, where there was once an “iron-clad” rule about being late, the IRS is now willing to consider good excuses.

While we are on the subject of IRAs, let’s review the rules for Roth IRA contributions. A Roth IRA accepts deposits of after-tax money that then may grow without taxation of dividends, interest or capital gains inside the account. When the money is paid out, it comes out tax-free, unlike normal IRA distributions, which are taxable.

An individual can contribute $3,000 to a Roth in 2004. This limit goes up to $4,000 for 2005-07 and $5,000 in ’08. The maximum contribution limits are phased out for individuals with adjusted gross incomes between $95,000 and $110,000 and for married couples filing a joint return with AGI between $150,000 and $160,000.

Finally, I have noticed a number of revised brokerage 1099 statements being sent out. A primary reason for revised statements is the reclassification of certain mutual fund dividends from non-qualified to qualified. Qualified dividends are taxed at the lower 15% rate, while ordinary dividends are taxed as ordinary income. The bad news is that you may have to file an amended tax return to properly account for the changes. The good news is that in most cases, this should result in lower taxes.

Bruce Fenton is a financial consultant, a writer, and the Managing Director of Atlantic Financial Inc. Bruce welcomes inquiries, comments, and questions. He can be reached by contacting The Fenton Report.

Billy Joel wrote a smash hit “Moving Out” in 1977 that is now a popular musical touring the country. The title could also be used to reflect the changes that have occurred in retirement planning as a result of stocks down, real estate up.

According to an article in Kiplinger’s, 60% of boomers ages 44 through 56 plan to move to a new home in retirement. That’s up from just 31% of pre-retirees they interviewed just 5 years ago.

Unlike their parents and grandparents, today’s boomers are not about to kick back in a rocking chair on the porch of the old family homestead where they were born, grew up, raised their family and now expect to pass on the family plot nearby. Boring!

Instead, they are carrying their active lifestyles and innate desires for the new and different into retirement, seeking out communities that offer opportunities to pursue other interests. And, it is beginning to sink in that they will be living almost as long in retirement as they spent working, so it is making sense to look for more suitable digs.

The tax laws that allow married couples to take $500,000 tax-free from a sale of a personal residence have made selling the family home and moving on particularly attractive. For many, they can sell their home, buy a smaller, more manageable retirement home in a more attractive retirement setting, and pocket the gain, tax-free.

Easy access to inexpensive air transportation, cell phones, the internet, instant message, and digital cameras have made it possible to be miles away from family and friends, yet remain closely in touch. And, as my wife has discovered, shopping on the Internet gives her 24-hour a day access to her favorite shopping haunts from the comfort of home. So why would one have to live anywhere near a big mall?

Financially, having a paid for home with some tax-free capital invested makes the diminished retirement savings plan a bit more tolerable. The difference between housing prices in “working areas” such as Silicon Valley in California and many other areas of California, or inside the Beltways of cities like Boston, Washington D.C., and retirement communities in the Sun Belt or areas like Bellingham, Washington, Ashland Ore, Park City, Utah or Naples, Fla., makes this work.

Certain retirement havens have tax laws particularly favorable to retirees. Six states, Alaska, Washington, Nevada, Florida, South Dakota, and Texas have no state income tax. New Hampshire and Tennessee tax only interest and dividends. But, as Kiplinger’s pointed out, income taxes should not be the sole reason for choosing a state.

Kiplinger’s published a Tax Survey of total taxes that a household might be expected to pay in locations around the country. Taking into account property taxes, sales taxes, gasoline taxes and other local taxes, they found that the lack of a state income tax does not guarantee tax-free living. They found the least expensive total tax bills in Cheyenne, WY. And the most expensive tax bills in Bridgeport, Conn. However, states like Colorado, despite a moderate income tax, were relatively inexpensive with lower property, sales and gasoline taxes.

The Internet has made shopping for a possible retirement location and home much easier. A quick search will yield a vast number of websites that can provide valuable insights into communities, retirement lifestyles, and real estate availability for those interested in “Moving Out”.

Opponents to of tax cuts cite numerous reasons why tax cuts won’t work. Too much, benefits the rich over the poor, will lead to deficit spending, will waste the surplus… all concerns expressed by the doubters. However, they are ignoring history.

Somehow they forgot the legacy of the Reagan presidency. So, on the anniversary of his 95th birthday, it seems fitting to comment on his legacy and vision.

Described by economist Art Laffer as the last “real President,” Reagan brought to the office a strong, singular focus to build a better country and to shut down world communism. Without a doubt, he did both.

Upon assuming office, he immediately embraced the supply side economic policies advanced by his economic advisor, Laffer. The Laffer Curve theory held that if taxes were cut, the resulting money left in the hands of the people and not the government, would stimulate the economy and the resulting growth would actually generate more tax revenue.

The broad-based income tax cuts that Reagan pushed through did exactly that, setting off an entrepreneurial boom that has propelled the growth of the economy for the past 20 years. Certainly the Clinton Presidency benefited from the tax cuts, and to Clinton’s credit, he even added his own cut by reducing the capital gains tax.

Reagan added to the economic well being of the country by facing down communism, and for all intents, shutting down its socialistic economic system around the world. This has opened up vast parts of the world as a marketplace for our goods and services. Today, one form or another of capitalism propels the economic environment of the world.

Reagan’s detractors, and to be sure there are many, point to his lack of sensitivity for social issues and the legacy of his deficit spending on defense and the infrastructure throughout the land.

In the case of the latter, we can draw a corollary by comparing his spending with what all of us do with our homes. We buy homes, and when home values and/or our income goes up, we remodel. By remodeling, we add value to our homes and increase the livability, or quality of life that comes with having a nicer home. The money for this remodeling usually comes from refinancing… adding to our family debt with additional long-term mortgage borrowing.

But, we do so with the mindset that we will have the income in future years to pay off this debt. Reagan envisioned leaving money in the hands of the people rather than the government, where it could be put to more productive uses than government spending would provide. He was right—our economy grew, and government income increased, eventually providing cash flow capability to pay for the “remodeling” that his Presidency did over his eight years in office.

Bruce Fenton is a financial consultant, a writer, and the Managing Director of Atlantic Financial Inc. Bruce welcomes inquiries, comments, and questions. He can be reached by contacting The Fenton Report.