You can’t always believe the markets. Since 2009, the S&P 500 and Dow Jones have been on a tear and are, thanks to the Federal Reserve, making new record highs. Since the markets are considered an indicator of the health of the U.S. economy, one could be forgiven for thinking the economic recovery has been benefiting most Americans. It isn’t.

1. Title: How to Protect Your Assets While the Majority of Americans
Aren’t
Author: John Whitefoot, http://www.dailygainsletter.com/
Body
You can’t always believe the markets. Since 2009, the S&P 500 and Dow
Jones have been on a tear and are, thanks to the Federal Reserve, making
new record highs. Since the markets are considered an indicator of the health
of the U.S. economy, one could be forgiven for thinking the economic
recovery has been benefiting most Americans. It isn’t.
In fact, the economic recovery has left the majority of Americans in the dark.
But there are a number of investment opportunities available to those who
think they missed the so-called economic recovery—opportunities that can
protect them from inflation.
During the first two years of the economic recovery (2009-2011), the wealth held by the richest seven
percent of households rose 28%, while the net worth for the bottom 93% fell four percent. (Source: Fry,
R. and Taylor, P., “A Rise in Wealth for the Wealthy; Declines for the Lower 93%,” Pew Research web
site, April 23, 2013.)
Why the large discrepancy? During the start of the economic recovery, stocks and bonds rallied, but the
housing market remained flat. Wealthier households park their assets in stocks and other financial
products, while less affluent Americans have their wealth tied up in the value of their homes.
Between 2009 and 2011, the S&P 500 rose by 42%—and has since climbed another 30%—while the
S&P/Case-Shiller Home Price Index fell by five percent. While housing prices have benefited from the
economic recovery, they are still 25.5% below their 2006 highs.
And don’t forget about the millions of Americans not fortunate enough to own a home. After bottoming
on March 6, 2009, the S&P 500 closed out 2011 up more than 90%. During that same period, the
number of Americans receiving food stamps also jumped 33.8% to a record 44.7 million.
Wall Street might be pointing to an economic recovery, but for the average American, true economic
recovery is a myth. (Source: “Supplemental Nutrition Assistance Program Participation and Costs,”
United States Department of Agriculture, Food and Nutrition Services web site, last accessed July 12,
2013.)
The increase in the use of food stamps shows that the economic recovery isn’t trickling down to
everyone, and that the American Dream continues to be out of reach for a growing number of people.
In 2012, the federal poverty line for a family of four was $23,283. Unfortunately, that imaginary line
doesn’t take into account very many meaningful measures. In essence, there is nowhere in the U.S.
where two parents earning the federal minimum wage of $7.25 an hour (which collectively amounts to

2. about $30,000 a year) can make enough to support a family of three or four. (Source: Gould, E., et al.
“What Families Need to Get By,” Economic Policy Institute web site, July 3, 2013.)
For example, it takes a combined income of $44,617 for a family of three to cover the most basic
necessities in Simpson County, Mississippi, the region with the lowest cost of living for that type of
family.
This means the 3.6 million American workers who earned the federal minimum wage (or less) in 2012
can’t even manage to live paycheck-to-paycheck. (Source: “Characteristics of Minimum Wage Workers:
2012,” Bureau of Labor Statistics web site, February 26, 2013, last accessed July 12, 2013.)
For those 93% of Americans who have seen their wealth eroded since the economic recovery began in
2009, there are a number of wealth-preservation channels to consider.
IQ Real Return ETF (NYSEArca/CPI) provides a hedge against the U.S. inflation rate by providing a
“real return,” or a return above the rate of inflation, as represented by the Consumer Price Index (CPI).
Treasury Inflation-Protected Securities, or TIPS, increase with inflation and decrease with deflation.
They can be purchased directly from the U.S. Treasury or through a bank, broker, or dealer. When it
matures, the investor is paid the adjusted principal or original principal, whichever is greater.
By investing in wealth-preservation channels that provide a hedge against the inflation we all know is
coming, even the majority of Americans who have not benefited from the recent recovery can protect
the wealth they do have.
Source: http://www.dailygainsletter.com/investment-strategy/how-to-protect-your-assets-while-
the-majority-of-americans-arent/1214/
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