As usual, weekly economic reports only make a difference to day traders and short term investors. It may be interesting fodder for the talking heads at CNBC.

US stocks in mixed trading today as investors weigh a drop in consumer confidence report with a better than expected housing market report.

Stocks begin the week on an up note. Merger and Aquisitions seem to be the early theme of the week.

200 post milestone

We have just passed our 200th post on our blog! Hopefully we are helping people figure out the right way to invest and save money while reducing debt and expenses. Thanks go out to the St. Louis Bloggers Guild for helping us promote our blog and find more readers. If you've been thinking about writing a blog, check out: http://stlouisbloggersguild.org/ and think about coming to the Interactive Festival in October. Not sure why I'm writing in the 3rd person, but I like it!

The Fed also stated that they see signs of improvement in the economy and inflation remains "subdued". What does this mean? Don't expect rates to change soon.

As expected, the Federal Reserve announced today that they will leave interest rates where they are now, which is in the 0-0.25% range.

Mobile Blogging update

This week I have been trying a new feature on my blog called "Mobile Blogging". It allows me to post messages on my blog using my Blackberry via texts. Texting gives me 160 characters which is more than Twitter, but still not very much room to work with. So I have to balance making more frequent posts with not being able to say much each time. Also, with mobile blogging, I cannot post a title to my blog post. This may be of little consequence to most readers but it is a concern. For the time being, I will continue to experiment with this new format.

Classic story: Those waiting for the "sky to fall" to get back into the market have been watching the market hit one year highs! Dollar-cost averaging works!

What the Fed decides to do or not do with interest rates this week will not affect your portfolio 5 years from now.

Don't let your long term investment decisions be swayed by headlines and chatter from talking heads on TV.

Stock futures point to down day, but not everyone will head for the sidelines. The tech sector still appears to have steam.

Investors worried about a September selloff now think a correction may come in October. Meanwhile stocks continue to climb!

Individual investors are not convinced that this current stock market ralley is for real. Many expect a pullback of some kind and are booking profits.

Stocks have continued their winning ways this Friday as economic optimism trumps concerns over the pace of the recovery. The Dow Jones moves closer to 10000.

The only news of note in the stock market today is the Quadruple Witching Hour. That's when all the stock options and futures expire at once.

Mobile Blogging

I am setting up a new feature on my blog called "Mobile Blogging". Once it's set up I will be able to update my blog during the day, or at least much more frequently than I do now, by sending text message posts to my blog. Currently, I update in the mornings after I peruse the morning headlines and stock market updates, to get a sense of what is going on in the financial world. As you know, many times events happen or breaking news comes out, which can potentially change the market movements. Federal Reserve statements are one good example. So keep in touch, and for Twitter followers, I am still on Twitter @scottjwheeler.

CD Ladders

One strategy for CD buyers looking for higher yielding CD's is to buy CDs that mature farther into the future. That is, instead of buying a one year CD, buy a 3 year or 5 year CD. You may be surprised to know that CD's can have maturities up to 20 years out! Currently, many CD shoppers are buying one year CD's or less, because they are worried that interest rates will go up next year. But what if they don't? The Fed has not changed rates since December 2008, and they haven't given any indication that they will raise rates anytime soon. The risk in CD's is that you don't know what the rates will be in the future. So what's a better approach? Build a CD ladder with CD's that mature in staggered maturities. Many people want their CD's to mature each year so they can access cash for planned purchases or emergencies without penalty. If you build a CD ladder, you will have money available each year to spend or reinvest. So how do you do it? Buy a 1, 2, 3, and even a 4 year, and 5 year CD to begin. As each CD matures, you buy another 5 year CD which will go on the back end of your ladder. After 4 years, you will own nothing but 5 year CD's, but you will have a CD maturing each year, so you can take advantage of available cash, or buy another 5 year CD. Remember, 5 year CD's will always pay more than 1 or 2 year CD's, and if rates start to go back up, they will go up for all CD's not just the shorter ones. So if you are going to buy CD's, do yourself a favor and buy smart, build a CD ladder. For more aggressive investors, the same thing can be done with bonds.

Even CD's have a risk

As the financial world looks back on the past year of horror known as the collapse of the financial system, investors still look for ways to make money in the markets. Some have sworn off stocks and mutual funds forever, stating the risk of loss is too great and the possible recovery could take too long. Others have given up on bonds due to the risk of default which seems much higher today than in previous times. Side note: high yield or "junk" bonds have been the best asset class to own in the past year! Real estate investors have seen their portfolios deflate and harder to sell as the financial crisis became a credit crisis for potential buyers. Even gold, while inching towards the $1000 level again is still off 50% or better when looking at it on an inflation adjusted basis. The result? Many scared investors have turned to CD's offered by banks. They don't have any risk right? After all, you cant lose your money in a CD can you? Well, they are principal protected, but to say they don't carry a risk would be untrue. The risk with CD's is interest rate risk. When you buy a CD, you lock in an interest rate for the term of the CD. While this may be good when rates are falling, it's bad when rates are rising. The risk with a CD is, you do not know what the interest rates will be when your CD matures. So if you bought a CD that was paying 5% when you bought it, you might only get 2% when it comes time to reinvest that money. For people who live off the interest earned on CD's, this can be very bad. Some people have been speculating that interest rates are due to rise because inflation is imminent with all the government spending and bailouts this past year. Most economists dispute this theory, at least in the short term, and don't expect interest rates to jump until late next year or even 2011 at the earliest. So those CD buyers who purchased 6, 9, or 12 month CD's expecting higher rates next year, could be in for a rude surprise. So what's a CD shopper to do? Come back next time and we'll discuss a few strategies...

Jobless recovery

The big economic news of the day is the monthly employment report. It is expected that job losses are trending down. That's the good news. The bad news is that the unemployment rate will probably be 9.5%. Most economists are now saying that the recession has ended and that inflation will not be a concern. Interest rates should stay low for some time and most Fed watchers do not expect a change in rates until 2011. While an economic recovery is underway, experts warn that the rate of recovery will be very slow. What does this mean for you? Invest in solid companies. Preferable ones that are paying dividends. After all, you can't fake dividends! So cheer up! It's a 3 day weekend, football season has begun, and the worst is behind us!

If you can't stand the heat...

If you can't stand the heat...get out of the kitchen. This is a well known saying that bodes well for people investing in the stock market. Some people can't stand volatility. The ups and downs of the markets are frustrating to many people and cause them to worry and lose sleep. But volatility is not new. There have always been ups and downs in the markets and there always will be. One assumption people make is that the recovery from severe bear markets is too long. But they are not looking at the whole story. If you look at the stock market crash of 1929 as an example. Some might conclude that the Dow Jones did not recover and move on to new highs for over 15 years! But if you count reinvesting of dividends and capital gains, the recovery would have taken only 4 years! That's a big difference! Don't just look at the point to point moves on the charts. With dividends and capital gains, investors can make money in almost any market. This fact goes almost always unreported by most writers who are trying to make a case against stocks. So buy stocks and funds that pay dividends and be sure to reinvest those dividends. That's how you make money. If you want safety, buy CD's. If you want to invest, buy stocks. If you can't sleep at night, it might be time to reallocate your portfolio.

Know why you invest

Now that we are in September, many people may ask if they should get out of the market. Why? Because it's September! September has been a notoriously bad month for stocks in the past. There are a lot of reasons to get out of the market. Book profits. Raise cash for an emergency or planned expense. Rebalance your portfolio allocations. But should you sell just because the month on your calendar changed from August to September? Ask yourself if you are a long term investor or a short term trader. Will you need the money you have invested in the next 6 to 12 months? Perhaps you shouldn't be in the market in the first place. Are you saving for college expenses or retirement that is more than 10 years down the road? Stocks probably have a place in your portfolio. Everyone has different needs and objectives. Figure it out and discuss with your trusted advisers. Don't believe the hype on TV or in the internet chat rooms. Use volatility to your advantage.