AMERICANS: Cash Savings Rate Up!

By Staff Reporters



Whether we’ve got a recession coming remains the biggest will they or won’t they story, but it looks like more Americans are starting to sock away cash just in case.


Data just released by the Department of Commerce puts the savings rate for December at 3.4%—the highest level in seven months and the biggest uptick from the previous month since July 2021 (November’s rate was 2.9%).


Could be that everyone’s just saving up for breakfast eggs and Ticketmaster concerts?

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The “Life Cycle Investment Hypothesis”

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Physicians Returning to Zero?

[By Somnath Basu PhD, MBA] 

How have your investments done over the last three years? If you were to ask doctors, or the myriads of people who are or even pose as professional financial advisors, they would generally say that it would depend on how well your portfolio was diversified. By this jargon, they would mean how your money (in what proportions) was invested among various asset classes such as stocks, bonds, commodities, cash etc. The more it was spread out around various asset classes, the safer they would have been.

To see how safe (or how risky) your portfolio was over the last few years, it’s useful to view how these asset classes themselves fared over this time period. That is what is shown in the next chart where the following asset class performances over the last few years are shown. The chart shows the performances of stocks (S&P 500 shown by the symbol ^GPSC, in red), bonds (symbol IEI, Barclay’s 3-7 Year Treasury Bond index etf, in light green), Commodities (DBC, Powershares etf, in dark green), Long dollar (UUP, Powershares long dollar etf, in orange; this fund allows speculating on the dollar going up against a basket of important currencies; whenever the world financial markets are in turmoil, this index generally goes up as investors around the world seek the “safe haven” status of the dollar.

Alternately, note that this index value will also typically rise when the domestic economy is in a sound condition and both domestic and international investors favor the U.S. financial markets) and the short dollar (UDN, the Powershares inverse of UUP). Note that the “Cash” asset class has been left out and returns on cash (or money market funds) have been close to zero the whole time.

There are a few startling observations from this period. The first part that arrests the eye is how commodities performed over this time period. If your portfolio was heavy in this sector, you had a heck of a ride these last three years. If you had a lot of stocks as well, heck, your ride just got wilder. As can also be seen from the picture, healthy doses of bonds and currencies would have made your ride that much smoother.

On the other hand, what is additionally startling to observe is that we all started this period close to zero returns in the beginning of 2007 (around March 2007) and in June 2010, we are all converging back to zero returns. No matter how you were diversified, you either took a smooth ride (well diversified portfolio) from a zero return environment to a zero return environment or a wilder ride. That is why diversification is so important. Another way to gauge your diversification benefit is to use a two-pronged system.

The first is what I refer to as the “monthly statement effect”. When your monthly financial statements come in, you first observe the current month’s ending balance, then the previous month’s ending balance and then have a great day, a lousy day or an uneventful day. Depending on how good or bad (how volatile the ride) the monthly effect is, it may last for much more than just a day, maybe days. The second piece is your age.

Life Cycle Investment Hypothesis

As you grow older, you ask yourself how wild a ride can you tolerate at this point in your life? Hopefully, as you age, this tolerance level should show significant declines. If it does, you are then joining a rational investment group practicing a “lifecycle-investment hypothesis” style. Finally, did anything do well during this time? Yes, and surprisingly from an asset class whose underlying asset is shaped too like a zero – mother earth and real estate. Having some real estate in your investment basket (another important diversification asset) would not only have smoothed your ride but would have made your financial life so much more pleasurable. Just take a look at this picture below (FRESX, an old Fidelity’s real estate index fund) which says it all.


Even in the darkest days of falling real estate markets of 2008, this fund produced a positive return. Of course many other real estate indexes lost their bottoms; thus finding these stable indexes in all asset classes are well worth their salt. That is, if it is time for you to diversify.


Your thoughts and comments on this ME-P are appreciated. Feel free to review our top-left column, and top-right sidebar materials, links, URLs and related websites, too. Then, subscribe to the ME-P. It is fast, free and secure.

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Reflections on a Tent Hospital

Thoughts on Pop-Up Healthcare Facilities

By Dr. David Edward Marcinko; FACFAS, MBA, CMP™


According to the Philadelphia Inquirer, February 10, 2009, it took Mark Ross about 22 minutes to inflate the hospital for the first time. Yesterday, he did it in 14 minutes. In the event of a large-scale emergency – a direct hit by a hurricane for example, or a plane in the Delaware River [Think Hudson River, NY]  – Ross and other volunteers can have the mobile hospital running anywhere in Southeastern Pennsylvania within two to four hours of the first alert.

The Valley Forge Experiment

The day before, on February 9, in Valley Forge PA, dozens of current and potential volunteers got to see three tan and white tents – and reams of equipment – for the first time. The $1 million cost was paid by state and federal governments. With a portable generator, 50 cots, 130 ventilators, 26 wireless cardiac monitors and 27 patient carts loaded with tongue depressors, eye shields and IV sets, the rapid-response team is intended to fill the 72- hour gap before federal emergency help arrives after a disaster.


Now, despite this Valley Forge innovation, mobile, semi-permanent and pop-up healthcare facilities are not a new machination in civilian life or non-warfare times. In fact, please allow me to tell you of my canvass tent-hospital experience, back in the late seventies.

My Tent Hospital

At the time, I was completing my training program as a senior attending resident [SAR], and surgical fellow. The “hospital” where I moonlighted was located in a sleepy town about 40 miles North of Atlanta, Ga. Driving there in my lime-green, oil-burning 1969 Chevrolet Impala with balding tires [retreads] was always novel experience.

As I recall history, the tent-hospital began as a private medical clinic in a three bedroom converted brick ranch-house that was the style in the late 1950s’-60s. It was the private practice of a solo practitioner-internist for his rural patients who lived on farms too far from the big city – or for patient’s who mistrusted the medical establishment. There were many. It grew quickly, from the days before Medicare/Medicaid reimbursements, to modernity.

Think Cirque du Soleil

Expanding to a larger facility, with sparse economic resources, necessitated innovative thinking at the time. The hospital itself was a very large circular tent [bulls-eye configuration], built on semi-permanent concrete foundation with trampoline-like floor. The tent was shaped like a disc or sphere. In the center was an operating room for the visiting general surgeon. The next concentric layer was comprised of four rooms. The admissions, records department and triage room; a dirty-room with toilet; a clean room with bed and shower; and a kitchen with doctor/nurse station and lounge. The next third outer concentric layer consisted of about twelve patient “rooms”. The patients entered each room from the inner second layer, while the doctors and nurses opened a door-slot on the outer third layer for the introduction of food, information, gowns and equipment, visitor chit-chat and medications, etc. Each room was muck like a dungeon, jail or cell [Recall the Seinfeld episode where Kramer housed visiting Asians in his cabinet drawer or shelf]. The docs and nurses continually circulated the third outer “floor” layer, ministering to their respective patients. By the way; no staff nurse ever complained of tired feet, leg soreness or calf cramps because of the springy trampoline-like floor.

Not a TV MASH Unit


This “hospital” was not like a military MASH unit, at all. It was definitely civilian in nature, purpose and construct:

Think: Army CASH unit; not MASH unit.

CASH = Combat Army Surgical Hospital [semi-permanent].

MASH = Mobile Army Surgical Hospital [ambulatory]  

My Experiences

During my summer working there, I managed a small part-time, two-room medical clinic with a singular nurse. We treated all sort of minor injuries and ills, cuts, scrapes; boils and blisters; aches and sprains; dog bites, bee stings and allergies, and simple closed extremity fractures, infections, etc. I even operated on a half-dozen patients under local anesthesia with conscious sedation. For the holidays, I received presents from several nurses and patients who remembered me from the previous summer.

New Facility

My “tent hospital” was in operation for almost two decades before the founding physician retired. The site was replaced by a publically funded, much larger and permanent “modern” facility, as the surrounding suburbs grew. The new Woodstock Hospital is now a short-term facility, with 21 beds, but is not yet rated by any hospital service agency because of statistically low volume requirements. It is a District Authority owned hospital facility.

Source: Centers for Medicare and Medicaid Services for the years 2005-2007. 


Now, here’s the thing. My tent-hospitals’ claim-to-fame was that it, at the time of closure, was the only hospital in the State of Georgia to have never had a hospital acquired [nosocomial] or post-operative infection? To my knowledge, the feat has not been duplicated in this state. Of course, the new facility was not so fortunate. Increased medical acuity, treatment services and a different-mobile patient population was cited as the likely culprit.


And so, your thoughts and comments on this Medical Executive-Post are appreciated. Quality initiatives are good. And, health 2.0 information technology is the future of medicine. But, sometimes, prologue is past.

Speaker: If you need a moderator or speaker for an upcoming event, Dr. David E. Marcinko; MBA – Publisher-in-Chief of the Executive-Post – is available for seminar or speaking engagements. Contact:  or Bio:

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New Thoughts on MD Emergency Funds

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Physician Household Emergency Fund Size

[By Staff Writers]

It has been said that most ordinary people should have at least three months of living expenses (not including taxes) in a cash-equivalent reserve fund that is easily accessible (i.e., liquid).  The amount needed for a one-month reserve is equal to the amount of expenses for the month, rather than the amount of monthly income. This is because during no-income months there is no income tax.  

However, the situation might not be the same for physicians in today’s harsh economic climate. 

The New Realities

Now, some physician-focused financial advisors and Certified Medical Planners™ suggest even more reserve fund savings; up to two years. That’s because many factors come into play when determining how much a particular doctor’s family should have.

For example: 

  • Does the family have one income or two? If the doctor is in a dual-income family with stable incomes and they live on a single income, the need for a liquid reserve is less.  
  • How stable is the doctor’s income source? If a sole provider with an unstable income who spends all of the income each month, the need for a liquid cash reserve is high. 
  • Does the doctor own the practice, work in a clinic, medical group, hospital or healthcare system? In other words – employee (less control) or employer (more control). 
  • What is the doctor’s medical specialty and how has managed care penetrated his locale, or affected her focus? 
  • How does the family use its income each month; does it have a saver, spender, or investor mentality?  
  • Does the family anticipate the possibility of large expenses occurring in the future (medical practice start-up costs or practice purchase; children, medical school student debts; auto or home loans; and/or liability suits, etc)?  

The Past 

In the recent past, a doctor may have opted for a nine-twelve month reserve if the need for security was high – and a six-to-nine month reserve if the need for security was low. But today, even more may be needed.  So, the following questions may be helpful in determining the amount of reserve needed by the physician: 

1. How long would it take you to find another job in your medical specialty if you suddenly found yourself unemployed – same for your spouse?

2. Would you have to relocate – same for your spouse? 

3. How much do you spend each month on fixed or discretionary expenses and would you be willing to lower your monthly expenses if you were unemployed? 





Once the amount of reserve is determined, the doctor should use the appropriate investment vehicles for the funds. 

At minimum, the reserve should be invested in a money market fund. For larger reserves, an ultra-short-term bond fund might be appropriate for amounts over three-six months. While even larger reserves might be kept in a short term bond fund depending on interest rates and trends. 

So, what do the initials M.D. really mean? … more dough!

How much reserve do you have and where is it stashed?


Your thoughts and comments on this ME-P are appreciated. Feel free to review our top-left column, and top-right sidebar materials, links, URLs and related websites, too. Then, subscribe to the ME-P. It is fast, free and secure.

Speaker: If you need a moderator or speaker for an upcoming event, Dr. David E. Marcinko; MBA – Publisher-in-Chief of the Medical Executive-Post – is available for seminar or speaking engagements. Contact:


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Comprehensive Financial Planning Strategies for Doctors and Advisors: Best Practices from Leading Consultants and Certified Medical Planners™

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