2018 started with a complete bang in global financial markets. The Dow Jones Industrial Average broke 25000 and seems well on its way to 26000. Not only did our President say that it could go much higher in 2018, but so did David Tepper. The latter, of course, is one whose opinion matters. He is not only a real billionaire, but has real and tested insight into financial markets.

That having been said, it is still an important time to keep one’s wits and not to be over-exposed to financial markets. Crashes just as severe as the ones that we had in 2000 and 2008 could easily come from excesses like we have today and, as in the past, there will be no warning.

It is important, therefore, to pay attention to another big bang that we have seen in the first week of 2018. That is the pronounced rise in the best savings and CD accounts.

Last week, we suggested that rising rates in 2018 will finally offer a reason for investors to finally move from money center banks or major brokerages – where cash earns basically nothing – to savings and short-term CD rates. We have suggested concentrating on savings rates paying at or over 1.40% and one-year CDs at or over 1.70%.

This week we saw both Synchrony Bank and Sallie Mae Bank raise their online savings and money market rates to 1.45% APY. We also saw Dollar Savings Direct raise its online savings rate to 1.60%. These banks all rank highly on BestCashCow and if you have $2 million to move from Merrill Lynch, Goldman Sachs or Morgan Stanley, you might start by opening an account at each of these. You’ll be covered in a personal account up to $250,000 at each bank by the FDIC (or $500,000 in a joint account). See all of the best online savings rates here.

The first week of 2018 has also brought us our first 1-year CD in years that pays over 2%. Other online banks have recently raised their online on-year CD rates to or above 1.80%. These rates aren’t certain to extend into February, and January could be a good time to lock into a great rate for money that you definitely won’t need until 2019.

Last week, we encouraged investors to be cautious about locking into 5-year CD in a rising rate environment. We reiterate that caution, but we are seeing interesting 5-year CD products and interesting special term CD products in some markets.

Again, Happy New Year!

Blue States are working hard to overcome many of the hits they took following the all-Republican Tax Law – a law that decidedly disadvantage Blue high-tax states like New York, New Jersey, Connecticut, Illinois and California. Specifically, under the new tax law, state and local tax deductions were capped at $10,000, leaving everything above that figure subject for the first time to non-deductibility.

Worried about residents moving to lower tax states, Blue States are getting seriously creative about addressing these new burdens on their taxpayers. Specifically, they are quickly moving to identify and weigh a range of creative and legal strategies to lift the new tax burden unfairly levied on many of their most wealthy citizens. In this regard, they are looking seriously at a particularly creative strategy that would allow state and local taxes to be paid under the new tax law up to the new maximum limit of $10,000 per tax payer, and at the same time converting the remainder of taxpayer liability for state and local taxes into a tax-free “contribution” to the State. Such a strategy would effectively make the entire state tax obligation fully tax deductible, just as it had been prior to the new law. This is a highly imaginative solution and one being explored with great energy at this time.

The urgency and incentive behind the work of Blue States is not only to address unfair attacks on their taxpayers in the new all-Republican Tax Law. These states are also very concerned about losing essential funding for schools, mass transit, social programs and other services long embedded in the fabric of their infrastructure and social systems.

It is likely that the pressures they are facing in the near term will result in imaginative, even if short term, fixes addressing the new Law. As obvious will be efforts by all Blue States to win back majorities in Congress, and to seek to turn back this unfair all-Republican Tax Law there.

Happy New Year! 2018 is going to be a great year. Will it be another barnburner on the stock market like 2017? Maybe, but you sure cannot bet everything on it.

What you can be sure of is that savings rates have moved up. There are many online banks that are beginning the year paying 1.40% on savings accounts. There are now many 1-year CD rates at or above 1.70%. (Longer-term CD rates have also recently moved up and are worth watching in 2018, but we would begin the year by exercising some caution here.) Depending where you live, you may even find local rates at banks and credit unions that are much higher.

For many years, I have heard the constant refrain. “Why bother? I may be making 0.01 at Chase or Citibank or Wells Fargo or Morgan Stanley or Merrill Lynch, but it just isn’t worth my time.” I often hear this from people who have millions sitting in cash.

If you have $2 million spread across 8 or 9 online savings accounts and short-term CDs (to stay below FDIC and NCUA limits), you can easily earn $30,000 pre-tax in 2018 on this money - and more as rates go up from here. Even if you are lucky enough to be in a high tax bracket and to live in a blue state and be severely impacted by the Trumpian tax law, you are still likely to net $16,000 or $17,000 after tax on this money.

We think that there is a lot you can do with that $16,000 or $17,000 in “free” money in 2018. You can put it towards a new car, take your family on a trip to Hawaii or save for your kids’ education. You could also give it to any small charity that will also be severely impacted by the tax changes.

It will take you 30 minutes online to open the accounts and set up the transfers. Just don’t let the bank make (or take) the money for free for another year.

Make a New Years' Resolution and fix this now.