Now What: A Guide to Retirement During Volatile Times

All Eyes on the U.S. Economy

2012-01-30T08:51:00.000-08:00

Eyes on the U.S. Economy

With only a couple trading days left in January, stocks are positioned to lock in four straight months of gains and finish with their best performance since 1997. Unfortunately, some momentum was lost last week after the government said the U.S. economy expanded at a slower-than-expected pace in the fourth quarter. For the week, the Dow Jones Industrial Average fell 0.5%, while the S&P 500 and Nasdaq notched modest gains.

Because the figures reported by the Commerce Department were lower than expected and stocks pulled back, should that lead us to conclude that economic growth was poor? Not at all. Gross domestic product, the broadest measure of the nation's economic health, grew at a 2.8% annual rate during the last three months of the year, which is a major improvement from the 1.8% we saw during the third quarter, and is the fastest growth we’ve experienced since the second quarter of 2010.

On the other hand, when you look closely at the numbers, there are some important points to note. One is that the majority of the growth came from one area – business inventories. Private businesses increased inventories $56.0 billion in the fourth quarter, following a decrease of $2.0 billion in the third. Of course that sounds wonderful, but it can also be a double-edged sword. While it shows that businesses are optimistic about the health of the economy and feel confident they can sell their goods, if sales fall short of expectations, it can create a financial burden for them in the future. Only time will tell how this works out.

Another important point is that “real final sales of domestic product” – GDP less the change in private inventories – only increased 0.8% in the fourth quarter, compared with an increase of 3.2% in the third. So while GDP as a whole picked up in the fourth quarter, real sales slowed down. This is likely one of the reasons why the Federal Reserve lowered its outlook for the economy in 2012, announcing that they expect it to grow between 2.2% and 2.7% this year.
What’s next? The week ahead is a heavy one for economic data that includes personal income, consumer confidence, auto sales, manufacturing, construction, and the key nonfarm payrolls figure at the end of the week. In addition to the economic news, nearly 100 companies in the S&P 500 will report quarterly earnings.

Why are all these numbers important? For months, U.S. economic indicators have taken a back seat to headlines out of Europe, but as confidence grows that the Eurozone will survive, focus should gradually shift back to the health of the U.S. economy. We’ll be watching this data and sharing our thoughts with you along the way.

ECONOMIC CALENDAR:
Monday – Personal Income and Outlays
Tuesday – Employment Cost Index, Redbook, S&P Case-Shiller HPI, Chicago PMI, Consumer Confidence
Wednesday – Motor Vehicle Sales, ADP Employment Report, ISM Manufacturing Index, Construction Spending, EIA Petroleum Status Report
Thursday – Jobless Claims, Productivity and Costs
Friday – Monster Employment Index, Employment Situation, Factory Orders, ISM Non-Manufacturing Index

Data as of 1/27/2012 1-Week Since 1/1/2012 1-Year 5-Year 10-Year
Standard & Poor's 500 0.07% 4.67% 1.29% -1.49% 1.62%
DOW -0.47% 3.63% 5.59% 0.28% 2.87%
NASDAQ 1.07% 8.11% 2.22% 3.13% 4.54%
MSCI EAFE 1.08% 5.98% -10.15% -3.74% 3.09%
10-year Treasury Note (Yield Only) 2.03% N/A 3.38% 4.88% 5.07%

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. N/A means not available.

HEADLINES:
On Friday, the Obama administration said it was expanding eligibility for its Home Affordable Modification Program, known as HAMP, to borrowers with higher debt loads and tripling the incentives it pays banks that reduce principal on loans. While the new changes could greatly expand the number of homeowners that receive help from HAMP, subsidizing real estate investors with taxpayer money could also create controversy.
The leaders of Denmark and Finland said China is “willing” to contribute to International Monetary Fund efforts to bail out debt-ridden southern Europe, within limits. Speaking at the World Economic Forum annual meeting in Davos, Helle Thorning-Schmidt, prime minister of Denmark, and Finnish Prime Minister Jyrki Tapani Katainen stressed the need for China and the European Union to cooperate on some form of bailout from the IMF.
A U.N. nuclear team arrived in Tehran, Iran early Sunday for a mission expected to focus on Iran's alleged attempt to develop nuclear weapons.
Facebook may finally be ready to go public. The company is planning to file IPO registration papers with the Securities and Exchange Commission next Wednesday, according to the Wall Street Journal. Few additional details are available so far.

The January Effect

2012-01-23T08:12:00.000-08:00

The January Effect

There’s an old adage you may have heard recently which says: “As goes January, so goes the year.” What is this January barometer all about? According to the Stock Traders Almanac, the month of January tends to predict the direction of the market with an 88.5% accuracy ratio, with only seven major errors recorded since 1950. Those aren’t bad numbers.

What causes the “January effect”? Most sources attribute it to a calendar-related anomaly in the financial markets where security prices increase in the month of January because investors sell losing positions in December and reposition themselves after the first of the year, or vice-versa. While this is certainly not exact science, and it is far too early to know if January will accurately predict the rest of the year, it is interesting to note.

So far, the Bulls are really showing off. With seven trading days left to go in January, the benchmark indexes are all up between 4% and 7%. The S&P 500’s 4.5% YTD gain marks its best start since 1987! So does this bull have legs? Skeptics will tell you it doesn’t and idealists will tell you it does. We’d like to tell you that we don’t know. We’re not clairvoyant. (Sorry, we know you wish we were.) What we do know is that markets don’t move up or down in a straight line, and we won’t be surprised if we experience a pullback in the weeks ahead. This is not something we fear; it’s just the nature of the stock market.

There are both positive and negative factors at work right now, and we are monitoring many of them. Europe is still on the map, and our economy is growing at a slower-than-average rate that leaves it somewhat vulnerable to external shocks. At the same time, we see the strengthening in various sectors such as financials, basic materials, durable goods, and technology as reasons to sustain our optimism that both the stock market and the economy may fare well in 2012.

ECONOMIC CALENDAR:
Tuesday – Redbook
Wednesday – Pending Home Sales Index, EIA Petroleum Status Report, FOMC Meeting Announcement
Thursday – Durable Goods Orders, Jobless Claims, New Home Sales, Leading Indicators
Friday – GDP, Consumer Sentiment

Data as of 1/20/2012 1-Week Since 1/1/2012 1-Year 5-Year 10-Year
Standard & Poor's 500 2.04% 4.59% 2.74% -1.61% 1.67%
DOW 2.40% 4.12% 7.59% 0.25% 3.02%
NASDAQ 2.80% 6.97% 3.05% 2.74% 4.44%
MSCI EAFE 4.70% 4.85% -9.07% -3.98% 2.80%
10-year Treasury Note (Yield Only) 1.85% N/A 3.46% 4.77% 4.89%

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. N/A means not available.

HEADLINES:
The economy probably grew at its fastest pace in a year and a half during the fourth quarter; a key U.S. report is expected to show. The current MarketWatch forecast of economists predicts 3.0% growth in the fourth quarter, well above the third-quarter level of 1.8%. That would be the fastest pace of growth in a year and a half.

Amid heightened tensions with Iran, an American aircraft carrier has sailed through the Strait of Hormuz into the Persian Gulf. The Navy says it's a routine maneuver. Iran recently suggested it might use military force to close the Strait in retaliation for new international economic sanctions.

The average price for regular gasoline at U.S. filling stations rose 3.48 cents to $3.3944 a gallon last week, according to Lundberg Survey Inc.
Postage rates jumped Sunday for the first time in two and a half years as the U.S. Postal Service hopes to generate more revenue amid historic losses. First-class postage stamps now cost 45 cents each; a price jump that officials anticipate will generate an additional $888 million in annual revenue.

QUOTE OF THE WEEK:
“The glow of one warm thought is to me worth more than money.” – Thomas Jefferson

European debt concerns carry over to 2012

2012-01-17T09:12:00.000-08:00

European debt concerns carry over to 2012

We know you’re probably tired of hearing about Europe’s debt crisis, and frankly, we don’t blame you. At risk of sounding insensitive to the struggles of our European neighbors, we’re tired of it too. While there are benefits to globalization, there are also drawbacks as evidenced by the unprecedented level of negative influence Europe’s financial issues have had on us in recent years.

As we look at last week’s activity, we can see the affect Europe is having yet again. While all three indexes ended the week in positive territory, recent gains came at lower-than-normal trading volumes as wary investors dipped their toes in the water, but were afraid to dive in.
Stocks finished in the red Friday on expectations that nine Eurozone nations would be downgraded by S&P (and they were shortly after trading hours), including AAA-rated France and Austria. Italy was lowered two notches to BBB+, dangerously close to junk bond levels that could make it even more difficult for the government to raise money. Here’s the report card :
France – AAA to AA+
Austria – AAA to AA+
Slovenia – AA- to A+
Slovakia – A+ to A
Spain – AA- to A
Malta – A to A-
Italy – A to BBB+
Cyprus – BBB to BB+
Portugal – BBB- to BB

While investors have been expecting this downgrade since S&P issued a warning last month, the news is still a harsh reminder that Europe is not out of the woods. It is not yet clear how hard the downgrades will hit markets, but it is likely that we will continue to feel Europe’s influence until this situation is resolved. On the bright side, leaders from Germany, Italy, and France have been sounding upbeat about proposed solutions. We hope their optimism will promptly translate into concrete actions.

When any set of circumstances has the potential to affect your financial situation, we are committed to monitoring it closely and to keeping you informed. Please rest assured that the European debt crisis is no exception.

ECONOMIC CALENDAR:
Monday – U.S. Holiday: Martin Luther King Jr. Day
Tuesday – Empire State Manufacturing Survey
Wednesday – Producer Price Index, Industrial Production, Treasury International Capital, Industrial Production, Housing Market Index
Thursday – Consumer Price Index, Housing Starts, Jobless Claims, Philadelphia Fed Survey
Friday – Existing Home Sales

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. N/A means not available.

HEADLINES:
The average price for a gallon of regular unleaded gasoline in the United States on Monday was $3.39, according to motorist group AAA. That's nearly 30 cents higher than a year ago. The national average reached a peak of $4.114 in July 2008.
Saudi Arabia can make up for any loss of crude oil production if sanctions are placed on Iran, the country's oil minister told CNN in an exclusive interview set to air Monday. "I believe we can easily get up to 11.4, 11.8 (million barrels a day) almost immediately, in a few days, because all we need is to turn valves," Saudi Oil Minister Ali al-Naimi told CNN's John Defterios. "Now to get to the next 700 or so, we probably need about 90 days."
Consumer sentiment this month hit the highest level since May, with both current and future economic conditions seen as improving, according to data released Friday by the University of Michigan and Thomson Reuters. The consumer-sentiment index reached 74 in the preliminary reading for January, compared with 69.9 in December.
U.S. defense leaders are increasingly concerned that Israel is preparing to take military action against Iran, over U.S. objections, and have stepped up contingency planning to safeguard U.S. facilities in the region in case of a conflict.

QUOTE OF THE WEEK:
“never forget that doing what you love is the cornerstone of having success in your life” Dr . Wayne Dyer

Share the Wealth of Knowledge!
Please share this market update with family, friends, or colleagues. If you would like us to add them to our list, simply click on the "Forward email" link below. We love being introduced!

Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.

By clicking on these links, you will leave our server as they are located on another server. We have not independently verified the information available through this link. The link is provided to you as a matter of interest. Please click on the links below to leave and proceed to the selected site.

2012 off to a good start for US Stocks

2012-01-09T08:01:00.000-08:00

2012 off to a good start for US Stocks

Are you getting used to writing 2012 on your checks yet? The first nine days of the new year have sure flown by! After all the hustle and bustle of the holiday season, we hope you’re settling back into a normal routine, and that your first week of 2012 has been a good one.

We’re happy to report that it was a good week both for stocks and positive U.S. economic news. Stocks kicked off the year on a high note as the Dow Jones industrial average added 1.2%, the S&P 500 gained 1.6%, and the Nasdaq led with a 2.7% rise. As far as the economy is concerned, employment figures and purchasing manager surveys released last week suggest the U.S. experienced healthy growth in December.
Despite positive news, the tone on Wall Street has remained cautious and trading volumes have been low. Many investors, it seems, are still torn between rising hopes for the U.S. economy, and the ever-evolving European debt saga. And there is still considerable debate over whether stronger jobs and manufacturing numbers should be attributed to a seasonal holiday binge, or something more permanent. Ultimately, only time will tell.

The week ahead promises to be a busy one as the unofficial start of corporate earnings season kicks off. We’ll wait to see what corporate leaders have to share, but overall, it is expected to be a strong season. The companies in the S&P 500 are forecast to be up 7.5% in the final three months of 2011, versus the same period one year ago, and sales are predicted to have risen 8.6% for the quarter, according to research from S&P Capital IQ. While the European debt situation will probably weigh most heavily in the headlines, it will have to share the spotlight with corporate earnings.

With one week down and 51 to go, we’re off to the races, as the old saying goes. Whatever this year brings, we look forward to running alongside you every step of the way!
ECONOMIC CALENDAR:
Monday – Consumer Credit
Tuesday – Redbook, Wholesale Trade
Wednesday – EIA Petroleum Status Report, Beige Book
Thursday – Jobless Claims, Retail Sales, Business Inventories, Treasury Budget
Friday – International Trade, Import and Export Prices, Consumer Sentiment

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. N/A means not available.

HEADLINES:
All three U.S. automakers are on track to be profitable in 2011 when they report results in the coming weeks. That's something that hasn't happened since 2004.

Gas prices in the United States increased by more than a dime over the past three weeks, the first increase seen since mid-October, according to a survey published Sunday. The average price of a gallon of regular gasoline was $3.35 as of Friday, the Lundberg Survey found. That's an increase of 12 cents from the last survey of 2011, conducted December 16.

The U.S. added 200,000 jobs in December and the unemployment rate fell to the lowest level in nearly three years in a fresh sign the economy is picking up and businesses are more willing to hire. The increase in jobs last month was the fourth biggest gain of 2011.

The Federal Reserve has decided to share the likely path of interest rates, according to minutes of its December 13 meeting released Tuesday. Starting in January, the Fed will release the range of Federal Open Market Committee member forecasts of the appropriate level on the target federal funds rate in the fourth quarter of the current year and the next few years.

QUOTE OF THE WEEK:
“Most people are searching for happiness outside of themselves. That’s a fundamental mistake. Happiness is something you are, and it comes from the way you think. Dr. Wayne Dyer

Share the Wealth of Knowledge!
Please share this market update with family, friends, or colleagues. If you would like us to add them to our list, simply click on the "Forward email" link below. We love being introduced!
If you would like to opt-out of future emails, please reply to this email with UNSUBSCRIBE in the subject line.

Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.

By clicking on these links, you will leave our server as they are located on another server. We have not independently verified the information available through this link. The link is provided to you as a matter of interest. Please click on the links below to leave and proceed to the selected site.

2011 – A Year in Review, 2012 going forward for the stock market

2012-01-03T07:40:00.000-08:00

2011 – A Year in Review, 2012 going forward

As we close the books on 2011, many will associate the year with Europe’s debt crisis, Congress’ political gridlock, and the stock market’s volatility. And to some extent, they’ll be right. We did face a number of significant challenges during the course of the year. At the same time though, 2011 was a year of growth and healing for the United States.

Americans are spending again, as evidenced by a record-breaking holiday shopping season. Factories are producing more. Companies are generating impressive profits. The housing market is showing signs of life. And with the unemployment rate at its lowest level in nearly three years , even the job market is improving. While blind optimism can be a dangerous thing, focusing on the negative can be equally risky. So without amplifying the problems of the past or minimizing the challenges of the future, let’s take a look back at some of the key events that made 2011 what it was.

Japan Quake Shakes Markets (March)
The devastating earthquake and consequent tsunamis that hit Japan in March riled global markets. The Japan earthquake sent the Nikkei Index on a downward spiral, and the U.S. stock market soon followed. The auto industry lost ground as Japanese manufactures were forced to halt production due to power outages.

Budget Problems Almost Result in Shutdown (April)
Well into April, the 2011 budget had still not been approved by Congress. Instead, lawmakers passed six short-term spending bills through March. The final extension was set to expire on April 8th, forcing Congress to come to a budget agreement or face a shutdown. Had a shutdown occurred, Americans would have faced grievous consequences, and nervous investors felt the pressure.

Osama Bin Laden’s Death Rallies Markets (May)
Following the death of Osama Bin Laden at the hands of U.S. forces in Abbottabad, the stock market opened significantly higher. President Obama called Bin Laden’s death “the most significant achievement to date in our nation’s effort to defeat al Qaeda.” The Dow Jones industrial average rose 56 points (0.5%), the S&P 500 climbed 5 points (0.4%), and the Nasdaq Composite gained 8 points (0.3%).

U.S Government Risks Defaulting on Debt (July)
After the U.S. debt ceiling was reached in May, the government was forced to find a solution or risk default on August 2. Though congress had over 11 weeks to come to an agreement, things came down to the wire once again as lawmakers argued over solutions, leaving financial markets on edge.

S&P Downgrades the United State’s Credit Rating (August)
In what was perhaps the most humiliating news of the year, Standard and Poor’s decided to downgrade the U.S. credit rating from AAA to AA+, which marked the first U.S. credit downgrade in history. This downgrade hit stock prices hard, and the long term consequences of S&P’s move are yet to be known.

Occupy Movement Begins (September)
Activists began gathering in New York City’s Financial district on September 17th to protest social and economic inequality, high unemployment, greed, corruption, and the influence of corporations on government. The protests in New York City have sparked similar protests around the world. News surrounding this movement has been a regular feature of recent headlines.

A Note About Equities
U.S. stocks slid on the final trading day of the year, with the S&P 500 surrendering its 2011 gain and settling virtually flat for the year at -0.04%. The Dow Jones industrial average ended the year up 5.5%, its second consecutive yearly rise, and the Nasdaq composite index finished down 1.8% for its first annual loss since 2008. Despite disappointing equity returns in 2011, the last three months of the year were positive, which could bode well for 2012. The S&P 500 rose 11% in the fourth quarter, and the Dow climbed 12% for its largest quarterly point gain in its history. On the bright side, stocks seem to be well-priced. The S&P 500 is trading at 12 times its expected earnings per share versus a more typical 15 times. In other words, stocks appear cheaper than normal right now.

In Conclusion

What is in store for 2012? The answer to that question will depend on who you ask, and where they’re looking. At the end of the day, no one has a crystal ball that can be relied upon, and we should not be so arrogant as to make predictions. The indicators we are watching offer both positive and negative signs and many questions remain to be answered. How will Europe sort out its debt troubles? Will U.S. lawmakers raise the debt ceiling again in 2012? Will they extend the Bush Era tax cuts? How will China’s slowing economy affect the world?

The answers to these questions and more like them have the potential to affect financial markets.
All in all, 2012 is beginning on a more positive note than many investors could have predicted given the challenges of 2011. And while we hope the economy and the stock market maintains its positive momentum, history teaches us that ups and downs are part of life. Whatever we face in the year ahead, rest assured that we will maintain a watchful eye on any factors that have the potential to affect you. May a bright and prosperous 2012 be yours!

ECONOMIC CALENDAR:
Monday – New Year’s Day Observed
Tuesday – ISM Manufacturing Index, Construction Spending, FOMC Minutes
Wednesday – Motor Vehicle Sales, Factory Orders
Thursday – ADP Employment Report, Jobless Claims, ISM Non-Manufacturing Index, EIA Petroleum Status Report
Friday – Employment Situation
Data as of 12/30/2011 1-Week 1-Year 5-Year 10-Year
Standard & Poor's 500 -0.61 -0.04 -2.27 0.83
Dow -0.62 5.53 -0.39 2.05
NASDAQ -0.52 -1.80 1.57 3.11
MSCI EAFE 0.04 -12.2 -4.63 2.03
10-year Treasury Note
(Yield Only) 2.03 3.31 4.71 5.11

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. NA means not available.

QUOTE OF THE WEEK:
"Be always at war with your vices, at peace with your neighbors, and let each new year find you a better person." - Benjamin Franklin

Share the Wealth of Knowledge!
Please share this market update with family, friends, or colleagues. If you would like us to add them to our list, simply click on the "Forward email" link below. We love being introduced!
If you would like to opt-out of future emails, please reply to this email with UNSUBSCRIBE in the subject line.

Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.

By clicking on these links, you will leave our server as they are located on another server. We have not independently verified the information available through this link. The link is provided to you as a matter of interest. Please click on the links below to leave and proceed to the selected site.

The Final Stretch for 2011

2011-12-27T08:36:00.000-08:00

The Final Stretch for 2011

It looks like the stock market got a shot of holiday cheer as major U.S. indexes logged better than 3% gains last week. The Dow is now up 6% for the year, and the S&P 500 is back in positive territory. While many were calling for a so-called “Santa Clause rally,” others were concerned that fears surrounding Europe’s situation would continue to be a drag on the markets.
Last week however, Europe’s troubles were of little account as stocks rallied to their third weekly gain in four after Congress approved an extension of the payroll tax cut to ensure taxes won’t increase on January 1. In addition, tentative signs of improvement seen in government reports on personal spending, income, and housing, all helped boost equity markets last week.

What’s in store for the week ahead? With Wall Street closed for business on Monday, a number of major players on vacation, and few economic reports expected, trading volume will probably be light. Even so, there is something interesting we would like to share with you. According to the Stock Trader’s Almanac, the five trading days before January 1, and the two trading days that follow, typically generate abnormally high returns, yielding positive returns in 31 of the last 41 holiday seasons. Of course, past performance cannot be relied upon to predict future results, and other factors must be considered, but the trend is worth noting.

While many investors have already closed their books for the year, we head into the final stretch eager to end 2011 in the black. Regardless of what happens during the final four trading days of the year though, we encourage you to take comfort in knowing we will keep an eye on things for you. Again we urge you to relax and enjoy some well-deserved time with your family and friends.

Stay tuned for our annual recap due next week!

ECONOMIC CALENDAR:
Monday – U.S. Holiday Observed – Christmas Day
Tuesday – Consumer Confidence, S&P Case-Shiller HPI
Wednesday – EIA Petroleum Status Report
Thursday – Jobless Claims, Chicago PMI, Pending Home Sales

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. N/A means not available.

HEADLINES:

Gasoline rose to a six-week high after a U.S. government report that durable goods orders increased last month signaled an improving economy. Prices advanced 8% this week, capping the biggest weekly gain since March.

While some workers are worried about smaller paychecks next year, more than 1.4 million low-income earners will see their wages go up on New Year's Day. Minimum wage rates in Arizona, Colorado, Florida, Montana, Ohio, Oregon, Vermont, and Washington will rise between 28 and 37 cents per hour on January 1, thanks to state laws requiring that minimum wage keeps pace with inflation.

The total value of Americans' retirement assets stood at $17 trillion at the end of September – a drop of 7.5% from the record high of $18.4 trillion recorded on June 30, 2011.
Shoppers will return $46.28 billion in holiday merchandise, a record high, according to the National Retail Federation. At brick-and-mortar stores, holiday returns can boost business because it gets shoppers into the store once more. "If people return something, there's a 70% chance they will buy something else," said Britt Beemer, retail analyst and chairman of America's Research Group.

QUOTE OF THE WEEK for 2012

“Each experience in your life was absolutely necessary in order to have gotten you to the next place, and the next, up to this very moment” – Dr. Wayne Dyer

HEALTH TIP OF THE WEEK:

Wear a Pedometer
New research suggests routinely wearing a pedometer encourages people to walk about an extra mile each day, lose weight, and lower their blood pressure. Aim for at least 30 minutes of brisk walking and a total of 10,000 steps per day.

Share the Wealth of Knowledge!
Please share this market update with family, friends, or colleagues. If you would like us to add them to our list, simply click on the "Forward email" link below. We love being introduced!
If you would like to opt-out of future emails, please reply to this email with UNSUBSCRIBE in the subject line.

Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.
These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative or named Broker dealer, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

By clicking on these links, you will leave our server as they are located on another server. We have not independently verified the information available through this link. The link is provided to you as a matter of interest. Please click on the links below to leave and proceed to the selected site.

Will a Santa Clause Rally kick in?

2011-12-19T09:00:00.000-08:00

Will a Santa Clause Rally kick in?

Each week, through this commentary, we aim to bring you a brief summary of the most important financial-related news. Our primary goal is to educate you about factors that have the potential to affect your investments, and to help you cut through all the media clutter to find some clarity. Sometimes, finding that clarity can be especially challenging.

Last week, we were faced with a barrage of headlines from all over the world, and each piece of news seemed to have its own unique impact. In the end, investors struggled to make sense of all the news, and stocks ended a roller-coaster week in which all three indexes lost more than 2.5%.

Historically, the stock market has been sensitive to news. But amidst the uncertainty of recent years, its sensitivity has been heightened to an unprecedented scale. Headlines that would have barely made the evening news 10 years ago can easily lead a rally or retreat in a matter of minutes or hours in today’s environment.

Case in point from last week: Fitch put seven European countries on credit watch negative, and the markets retreated. Fitch affirmed the ratings of France, Belgium, Spain, Slovenia, Italy, Ireland, and Cyprus, and the markets rallied. Data came out showing holiday sales slowing, and the markets retreated. Headlines came out showing that holiday shopping boosts confidence in the recovery, and the markets rallied. We could repeat this scenario with housing data, gold prices, oil prices, and nearly any other shred of financial-related news.

What is our point? Don’t buy into the hype! Is it important to monitor world events for signals about how investments could perform? Yes. But is it healthy to dissect every smidge of news and then alter your investment strategy at each sign of strength or weakness? No. When signals are mixed and finding clarity is difficult, it is especially important to stick to your long-term investment strategy. Letting short-term, erratic moves dictate your investment decisions can easily lead to unnecessary losses.

It can be a jungle out there – there’s no doubt about it. But just as you would trust an experienced jungle guide to lead you to safety, please trust us to guide you through these uncertain times. Use the weeks ahead to enjoy some quiet time with your family and friends, and tune out the noise for a little while. We urge you not to let the media steal your focus from the things that matter most.

ECONOMIC CALENDAR:
Monday – Housing Market Index
Tuesday – Housing Starts, Redbook
Wednesday – Existing Home Sales
Thursday – GDP, Jobless Claims, Consumer Sentiment, Leading Indicators
Friday – Durable Goods Orders, Personal Income and Outlays, New Home Sales

Data as of 12/16/2011 1-Week YTD 1-Year 5-Year 10-Year
Standard & Poor's 500 -2.83 -3.02 -1.87 -2.91 0.86
Dow -2.61 2.50 3.19 -0.93 2.09
NASDAQ -3.46 -3.68 -3.11 0.80 3.08
MSCI EAFE -5.29 -15.4 -14.1 -5.03 2.01
10-year Treasury Note (Yield Only) 2.05 N/A 3.48 4.60 5.16

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. N/A means not available.

HEADLINES:
The U.S. House of Representatives On Friday approved a nearly $1 trillion bill to fund the government through the rest of the fiscal year that runs to the end of September 2012. Republicans and Democrats have been haggling for several months over spending plans for the rest of the fiscal year. The fate of a temporary payroll tax cut, however, was still undecided as of mid-Friday.

Gold futures climbed Friday to break a four-session losing streak, but prices finished the week with a loss of 6.9%.

The final convoy of U.S. troops left Iraq on Sunday, bringing an end to almost nine years of war in which tens of thousands of Iraqis and nearly 4,500 Americans died, media reports said.

Kim Jong Il, the dictator who used fear and isolation to maintain power in North Korea and his nuclear weapons to menace his neighbors and threaten the U.S., has died, North Korean state television reported early Monday.

Quote of the week:

The best of all gifts around any Christmas tree or Menorah: the presence of a happy family all wrapped up in each other. - Burton Hillis (Better Homes and Gardens)

RECIPE OF THE WEEK:
Homemade Eggnog

Who knew making your own eggnog could be so easy?
Recipe by: Sharon Tyler Herbst | from The Ultimate A-to-Z Bar Guide

Ingredients:
12 eggs, separated
1 cup sugar
16 oz. (1 pint; 2 cups) brandy
16 oz. (1 pint; 2 cups) bourbon or dark rum
32 oz. (1 quart; 4 cups) milk
1 tablespoon pure vanilla extract
32 oz. (1 quart; 4 cups) whipping cream
½ tsp. salt
freshly grated nutmeg

Directions:
Beat egg yolks with the sugar until creamy and light. Stir in brandy, bourbon, milk, and vanilla; cover and refrigerate for at least 4 hours, or until very cold. Whip cream until it forms soft mounds; fold into eggnog mixture. May be refrigerated for 1 to 2 hours at this point. Just before serving, beat egg whites and salt to the soft-peak stage; fold into eggnog. Sprinkle with nutmeg.

NOTE: Only use pasteurized eggs when making your eggnog to avoid salmonella.

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Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.
By clicking on these links, you will leave our server as they are located on another server. We have not independently verified the information available through this link. The link is provided to you as a matter of interest. Please click on the links below to leave and proceed to the selected site.

Naughty or Nice for the markets?

2011-12-12T08:28:00.000-08:00

Naughty or Nice for the markets?

Yet again, investors found themselves watching Europe last week – no surprises there – and were apparently pleased with what they saw. Word of a “new deal” incited a rally in stocks Friday that pushed the Dow Jones industrial average up 187 points, or 1.6%, the S&P 500 up 21 points, or 1.7%, and the Nasdaq up 50 points, or 1.9%. All major domestic indexes finished positive for the week on a wave of optimism.

What is this “new deal” everyone’s talking about? Basically, the 17 nations that use the euro agreed to sign a treaty that allows a central authority to oversee their budgets more closely. The agreement is made up of fiscal rules designed to prevent countries from veering further into crisis mode, and to rescue them if they do. The Friday proposals also commit the countries to put their €500 billion ($670 billion) European Stability Mechanism bailout fund into action next year, instead of in 2013.
While Britain chose not to support the plan, the majority of EU members are hailing this as a new beginning. German Chancellor Angela Merkel expressed that Europe has “…achieved a breakthrough to a stability union. A fiscal union, or stability union as I call it, will be developed further, step by step in the years to come." And French President Nicolas Sarkozy confidently boasted, “We're doing everything we can to save the euro.”

Whether this deal will be a new beginning for Europe, or turns out to be little more than political posturing, only time will tell. Either way, we are confident their debt saga is far from over. While tighter fiscal controls are definitely a crucial ingredient in mending this crisis, Friday’s agreement is only a partial solution, and we have seen agreements like this deteriorate before. Until a clear path to fiscal austerity has been established for the region, the markets will keep responding to hype and headlines.

When it comes to investing, rather than reacting to every shred of nice (or naughty) news, we still believe it is better to have a long-term plan and stick to it. We take great pleasure in helping you do just that!

ECONOMIC CALENDAR:
Monday – Treasury Budget
Tuesday – Retail Sales, Business Inventories, FOMC Meeting Announcement
Wednesday – Import and Export Prices, EIA Petroleum Status Report
Thursday – Jobless Claims, Producer Price Index, Empire State Manufacturing Survey, Industrial Production, Philadelphia Fed Survey
Friday – Consumer Price Index

Headlines:
Online sales for the holiday season to date (since November 1 to Friday) totaled $24.6 billion, a 15% increase over the $21.4 billion spent during the same period last year, ComScore reported. Last week's spending totaled $5.9 billion, also a 15% increase over the corresponding period last year.

Anti-Wall Street protesters plan to attempt to block major West Coast ports on Monday. By marching on U.S. ports from California to Alaska, organizers look to call attention to economic inequalities in the country and a financial system they complain is unfairly tilted toward the wealthy.

Scammers across the nation are targeting the Better Business Bureau. They're using BBB's good name to try and spread a computer virus. The scam e-mail says the BBB has received a complaint from one of your customers and says, "We encourage you to use our online complaint system to respond." When you click on the link, it reportedly installs a virus. If you receive one of these e-mails, delete it immediately and do not open the link.

Developing nations led by China and India pledged they’d work toward an agreement that would limit their fossil fuel emissions for the first time, the biggest advance in the fight against global warming in 14 years.

QUOTE OF THE WEEK:

The movie Elf staring Will Ferrell

Santa: That's another thing... Buddy you should know that your father... he's on the naughty list.
Buddy: Nooooo!

GREEN TIP OF THE WEEK:
Stop the Junk Mail

The amount of household garbage in the U.S. increases by about one million tons of trash between Thanksgiving and New Year’s, according to the EPA, and much of that is Christmas gift packaging. If you’re mailing gifts, use recycled packing materials like newspaper and cardboard. Shiny, metallic, and plastic-coated wrapping paper can’t be reused or recycled, but there are lots of wrapping papers and ribbons that are made of 100 percent recycled waste, and gift bags are a great reusable option.

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If you would like to opt-out of future emails, please reply to this email with UNSUBSCRIBE in the subject line.

Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.
These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative or named Broker dealer, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

By clicking on these links, you will leave our server as they are located on another server. We have not independently verified the information available through this link. The link is provided to you as a matter of interest. Please click on the links below to leave and proceed to the selected site.

Dr. Jekyll and Mr. Hyde Market

2011-12-05T08:59:00.000-08:00

Dr. Jekyll and Mr. Hyde Market

The story starts with after drinking a potion of his own creation; Jekyll is transformed into the smaller, younger, cruel, remorseless, evil Edward Hyde, representing the hidden side of Dr Jekyll's nature brought to the fore. Dr Jekyll has many friends and has a friendly personality, but as Mr Hyde, he becomes mysterious and violent. As time goes by, Mr Hyde grows in power. After taking the potion repetitively, he no longer relies upon it to unleash his inner demon i.e. his alter ego.

It seems that at times our market is similar to that of Dr. Jeckyll and Mr. Hyde the past two weeks. The market seems to have a ‘split personality’ of sorts.
From the worst Thanksgiving week since 1932 , to the best weekly gain since 2009, last week illustrated how fickle the stock market can be. The Dow Jones Industrial Average finished up 7% for the week, bouncing back from a 5% loss the previous week on news about… are you ready for it… positive developments in Europe.
Basically, several central banks made dollar financing cheaper through swap arrangements, and finance ministers took steps to expand the European Financial Stability Facility. Just as bad news from Europe pushed markets down during Thanksgiving week, good news from Europe pulled markets back up last week. At this point, it should be clear to everyone that we are dealing with highly Europe-charged investor sentiment right now.

So does last week’s rally mean we’re out of the woods and the bulls are back on top? It’s possible, but we don’t recommend counting on it. While some analysts are expecting stocks to maintain their momentum on the “Santa Clause effect” (Stocks have risen in December nearly four out of five times since 1945, according to S&P Capital IQ, and have risen almost 2% in December after dropping in November – as they did last month) , most understand that Europe is still a wild card.

When we see encouraging news and market rallies, it is easy to become excessively positive when we should actually be cautiously optimistic. In the same manner, when we see bad news and steep declines, it is easy to become excessively negative when we should actually be moderately cautious. What is our point? In times of uncertainty and volatility, it is particularly critical to stick to a long-term investment strategy that aligns with your personal goals and risk tolerance. We encourage you to avoid letting short-term market moves and flashy headlines influence your investment decisions. If you have any questions about whether your current financial plan is still right for you, please feel free to reach out to us. We are always here to help guide you through turbulent times.

ECONOMIC CALENDAR:
Monday – Factory Orders, ISM Non-Manufacturing Index
Tuesday – Bank of Canada Announcement
Wednesday – EIA Petroleum Status Report, Consumer Credit
Thursday – BOE Announcement, ECB Announcement, Jobless Claims, Wholesale Trade
Friday – International Trade, Consumer Sentiment
Data as of 12/02/2011 1-Week YTD 1-Year 5-Year 10-Year
Standard & Poor's 500 7.39 -1.06 1.86 -2.18 0.92
Dow 7.01 3.82 5.78 -0.29 2.20
NASDAQ 7.59 -0.98 1.84 1.77 3.61
MSCI EAFE 9.34 -11.1 -8.09 -3.90 2.30
10-year Treasury Note (Yield Only) 1.97 N/A 3.00 4.43 4.74

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. N/A means not available.

HEADLINES:
It’s hard to believe it’s already been 10 years since Enron filed for bankruptcy on December 2, 2001. At the time the largest bankruptcy in U.S. history – the once high-flying energy company cemented its reputation as the very symbol of corporate fraud.
The unemployment rate fell by 0.4 percentage points to 8.6% in November, and nonfarm payroll employment rose by 120,000, the U.S. Bureau of Labor Statistics reported Friday. Employment continued to trend up in retail trade, leisure and hospitality, professional and business services, and health care. Government employment continued to trend down.

Treasury Secretary Timothy F. Geithner will head to Europe next week to meet with French President Nicolas Sarkozy, new Italian leader Mario Monti, and other key government officials to discuss their efforts to resolve the debt crisis. Geithner, who has been urging European leaders to take more forceful action, will travel there for three days beginning Tuesday "for discussions with his counterparts on their efforts to reinforce the institutions in the Euro area," the Treasury Department said Friday.

The coming year-end spending spree after so much debate over budget deficits shows just how hard it is to stem the government's flow of red ink. Lawmakers are poised to spend $120 billion or so to renew a Social Security tax cut that averaged just under $1,000 per household this year. They're ready to commit up to $50 billion more to continue unemployment benefits to people out of work for more than half a year.

Quote of the week

‘Know that everything will happen at just the right time. At the right place, with just the right people’ Wayne Dyer

Share the Wealth of Knowledge!
Please share this market update with family, friends, or colleagues. If you would like us to add them to our list, simply click on the "Forward email" link below. We love being introduced!
.

Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.
These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative or named Broker dealer, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

By clicking on these links, you will leave our server as they are located on another server. We have not independently verified the information available through this link. The link is provided to you as a matter of interest. Please click on the links below to leave and proceed to the selected site.

Worst Thanksgiving week for the markets since 1932

2011-11-28T09:10:00.000-08:00

Worst Thanksgiving week for the markets since 1932

It was another brutal week for stocks as fears related to Europe’s debt situation dominated headlines. According to CNBC, the S&P 500 logged its worst Thanksgiving week since 1932. Ouch! For the week, the S&P 500 fell 4.7%, giving back almost two-thirds of its October gains.

Another factor that contributed to the poor performance is that trading volume was exceptionally light for the week as investors pulled away from their computers to enjoy some holiday relaxation. The day after Thanksgiving is typically one of the lightest volume days of the year, and true to form, only 3 billion shares (less than half the daily average) changed hands on major exchanges as the stock market closed early at 1 pm.

Even though the U.S. economic picture keeps improving, investors continue looking to Europe for signals. And unfortunately, the signals coming out of Europe are a mixed bag at best. Despite hopes that new leadership can pull the region out of crisis, more countries continue to struggle. Hungary’s credit rating was downgraded to junk status by Moody’s last week. Belgium, which has struggled to implement spending cuts after 18 months without a government, was downgraded on Friday to AA from AA+ by Standard & Poor's. Italy paid a record 6.5% to borrow money over six months on Friday, and its longer-term funding costs soared far above levels seen as sustainable for public finances. High debt yields from major economies such as Spain, France, and Germany suggest investing in the region is perceived as being more risky. And last week’s poor auction of German bonds raised concerns that the debt crisis is spreading to Europe's core. This rash of negative news is really disturbing investors.

To quote Brian Lazorishak, portfolio manager at Chase Investment Counsel "This market is going to continue to be driven by what's happening in Europe. If things seem to be falling apart, nothing else will matter. If it looks like there's a way out – a light at the end of the tunnel in Europe – that could spark a decent rally from where we are now.”

ECONOMIC CALENDAR:
Monday – New Home Sales
Tuesday – S&P Case Shiller, HPI, Consumer Confidence
Wednesday – ADP Employment Report, Productivity and Costs, Chicago PMI, Pending Home Sales Index, EIA Petroleum Status Report, Beige Book
Thursday – Motor Vehicle Sales, Jobless Claims, ISM Manufacturing Index, Construction Spending
Friday – Monster Employment Index, Employment Situation Report

HEADLINES:
Black Friday sales increased 6.6% to the largest amount ever as U.S. consumers shrugged off 9 percent unemployment and went shopping. Consumers spent $11.4 billion, ShopperTrak said in a statement yesterday. Foot traffic rose 5.1% on Black Friday, according to the Chicago-based research firm.

Did you skip the lines on Black Friday? There's still Cyber Monday -- and analysts are expecting an abundance of deals to bring in record online sales this year. Andrew Lipsman, an industry analyst at data tracking firm ComScore, said sales for the one-day shopping event are projected to hit a record $1.2 billion this year.
Last week, Congress's special 12-member deficit-cutting committee failed to agree on measures to address U.S.'s fiscal woes. It marked the third year in a row that taxpayers headed into December with major tax-code issues unaddressed. Lawmakers have a lengthy to-do list. The 2% Social Security payroll-tax cut for employees expires at the end of 2011. So do a host of other provisions, including a fix to keep the alternative minimum tax from expanding to millions more taxpayers in 2012, and an extension of the popular IRA charitable contribution for people older than 70½.

Oil prices rose towards $108 on Thursday, helped by bigger-than-expected stock draws in the United States and tensions around Iran.

QUOTE OF THE WEEK:
Doing what you love is the cornerstone of having abundance in your life. Dr. Wayne Dyer

Share the Wealth of Knowledge!
Please share this market update with family, friends, or colleagues. If you would like us to add them to our list, simply click on the "Forward email" link below. We love being introduced!

If you would like to opt-out of future emails, please reply to this email with UNSUBSCRIBE in the subject line.

Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.

By clicking on these links, you will leave our server as they are located on another server. We have not independently verified the information available through this link. The link is provided to you as a matter of interest. Please click on the links below to leave and proceed to the selected site.

Thankful for Good News underneath the headlines

2011-11-21T07:33:00.000-08:00

Thankful for Good News underneath the headlines

More than any other time of year, this week is one when people strive to count their blessings. There is no doubt being appreciative for what we have leads to a better, more satisfying life. It is wise to reflect upon the good things we enjoy, for it is one of the actions that can help us deal with the challenges we face.

During the past few years, nearly every corner of the globe has been affected by the financial crisis in some way. Even now, with the recovery well under way, we still feel the effects of high unemployment, a weak housing market, debt issues in the Eurozone, and a volatile stock market. On top of everything else, the media has a tendency to lead with what sells – sensationalism and bad news. So is there any good news out there? Definitely! Here are some developments to be thankful for:

- The employment picture is improving. The economy added 80,000 jobs in the month of October, and the unemployment rate fell to 9%. Economists are encouraged by signs companies are not cutting workers, and they say November's jobs report could be even better. The weekly jobless claims reports for the past three weeks have shown improvement.
- The housing market is showing signs of life. The Commerce Department reported that building permits, an indicator of future activity, surged 10.9% during October. In related news, the share of households delinquent on their mortgage payments has fallen to the lowest level since the end of 2008, offering signs that modest job gains are stemming further damage in the battered U.S. housing sector.
- Retail sales are up. American shoppers gave a better-than-expected boost to retail sales in October and left retailers with an encouraging outlook for the fourth quarter. Bloomberg reports a 0.5% gain followed by a 1.1% increase in September, according to figures released Thursday by the Commerce Department. Consumer spending accounts for roughly 70% of the US economy, and its recovery is essential.
- People are more optimistic about Europe. Treasury Secretary Timothy Geithner said Tuesday that Europe was making gradual progress in coming to grips with its financial crisis. "This is absolutely within Europe's capacity to solve and it's within their ability. It's within their grasp, it's within their reach," he said.
- Leading economic indicators are strengthening. The Conference Board's Leading Economic Indicators Index rose 0.9% in October, outpacing increases in the previous two months and providing some grounds for hope in economic growth to come. The index, comprised of 10 components, is intended to signal economic trends by taking a comprehensive look at the data. This month, nine out of 10 indicators were positive.

While things are still far from perfect, and caution must be exercised when making investment decisions, we are grateful to see a more positive U.S overall picture gradually emerging.

Regardless of what the headlines include in the week ahead, we encourage you to tune out the noise. Put down your Wall Street Journal, turn off CNBC, and enjoy some quiet time with your family and friends. We know you’ll be glad you did!

ECONOMIC CALENDAR:
Monday – Existing Home Sales
Tuesday – GDP, FOMC Minutes
Wednesday – Durable Goods Orders, Personal Income and Outlays, Jobless Claims, Consumer Sentiment, EIA Petroleum Status Report
Thursday – U.S. Holiday, Thanksgiving

QUOTE OF THE WEEK:
“Make it a habit to tell people thank you. To express your appreciation, sincerely and without the expectation of anything in return. Truly appreciate those around you, and you'll soon find many others around you. Truly appreciate life, and you'll find that you have more of it.” – Ralph Marston

RECIPE OF THE WEEK: Pumpkin Pie made simple (Ken Mahoney’s recipe)
Ingredients
• 1 cup white sugar
• 1/2 cup packed brown sugar
• 1/4 teaspoon salt
• 2 teaspoons ground cinnamon
• 2 eggs
• 1 (15 ounce) can pumpkin puree
• 1 1/4 cups milk
• 1 (9 inch) unbaked pie crust
Directions
1. Preheat oven to 350 degrees F (175 degrees C).
2. In a large mixing bowl, stir together white sugar, brown sugar, salt, and cinnamon. When these ingredients are well mixed, stir in the eggs followed by the pumpkin and milk. Transfer mixture to the pie crust.
3. Bake at 350 degrees F (175 degrees C) for 1 1/2 hours, or until a toothpick inserted into the pie comes out clean. Cool before serving.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.

European Politics Continue to Move Markets

2011-11-14T08:03:00.000-08:00

European Politics Continue to Move Markets

It was another yo-yo week for the stock market as ongoing worries surrounding Europe’s debt crisis kept investors in suspense. The choppy period eventually ended with a rally on Friday as welcome news of a political shake-up in Greece and Italy boosted confidence that there will be further progress toward a solution.
Greek Prime Minister George Papandreou has been replaced by former banker and European Central Bank Vice President Lucas Papademos , while Italian Prime Minister Silvio Berlusconi, who resigned on Friday, will likely be replaced by former EU Commissioner Mario Monti. The world will be watching as new leadership in both countries fight to implement reforms quickly and aggressively. Just Saturday, the Italian lower house of parliament approved a series of austerity measures demanded by Europe to shore up confidence in the country's economy. It passed by a vote of 380 to 26.

Why should any of this matter to Investors? While Greece is only the 32nd largest economy in the world, Italy holds the 8th spot, and is the 3rd largest in Europe. If these two countries can get their acts together, other debt-laden countries in the region will have a model to follow. If they fail to create change, the consequences could be far-reaching. Europe as a whole makes up 25-30% of the global economy, and millions of American jobs depend on stability and growth there. To quote Jacob Kirkegaard of the Institute for International Economics: “Europe is by far our biggest trading partner. It’s where most of our exports go. It’s where we have most of our foreign direct investments. US multinational corporations are in Europe.”

While it is unlikely that problems in Europe will cripple the American economy, we are connected to Europe in many ways, and investors know that. As long as Europe’s future remains hazy, stocks will likely continue to react to headlines from across the sea, as we have seen in recent months.

ECONOMIC CALENDAR:
Tuesday – Producer Price Index, Retail Sales, Empire State Manufacturing Survey, Business Inventories
Wednesday – Consumer Price Index, Industrial Production
Thursday – Housing Starts, Jobless Claims, Philadelphia Fed Survey
Friday – Leading Indicators

HEADLINES:
Moody's Investors Service is reviewing the risk to Penn State's reputation and finances in the wake of a child sex abuse scandal that has rocked the university. In coming months, the credit rating agency will evaluate whether the university should be downgraded. Penn State carries the second highest credit rating, reflecting very strong student demand and a strong national academic brand. The university has about $1 billion in rated debt.

Dubai’s fast-growing airline Emirates kicked off the Middle East’s biggest airshow Sunday with a huge order for 50 Boeing 777s, marking the U.S. aircraft maker’s biggest-ever single order in dollar terms.

The Securities and Exchange Commission admitted Friday that it had disciplined eight employees over their handling of the $50 billion Bernard Madoff Ponzi scheme without firing any of the workers. The disciplinary actions, which drew jeers from some victims of the investment scandal, prompted a ninth individual to leave the agency before the punishment was finalized. The actions were meted out over the past year and weren't disclosed by the agency until an article on the actions was published online Friday by the Washington Post.

QUOTE OF THE WEEK:
“If you want to feel rich, just count all of the things you have that money can't buy.” - Unknown

Share the Wealth of Knowledge!
Please share this market update with family, friends, or colleagues. If you would like us to add them to our list, simply click on the "Forward email" link below. We love being introduced!
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Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.
These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative or named Broker dealer, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

By clicking on these links, you will leave our server as they are located on another server. We have not independently verified the information available through this link. The link is provided to you as a matter of interest. Please click on the links below to leave and proceed to the selected site.

US Economy is beating expectations

2011-11-07T07:57:00.000-08:00

US Economy is beating expectations

If there is one factor with the greatest potential to mend our economy, it is a steadily improving employment picture. How so? When you look at the U.S. economy as a whole, it is primarily supported by consumer spending. In order for consumers to spend, they must have a measure of disposable income. In order to have disposable income, Americans must have jobs.

To look at it another way: As the employment situation improves, consumer spending typically increases, thus creating additional demand for goods and services. As demand for goods and services grows, more production is needed, thus creating more jobs, and so on. At risk of oversimplifying, this combination of factors explains the cycle of a healthy economy.

So are we seeing improvement in the nation's jobs picture? Yes. One year ago, the unemployment rate was 9.7%. As of October's report, it dropped to 9%. On average 152,000 jobs have been added each month during the same time period, for a total of 1.8 million jobs. In addition, the workweek has lengthened and wages are up 1.8%. All of this shows that the employment picture is gradually improving. Interestingly, October also showed improvement in chain store sales. Overall, the 23 major U.S.-based retailers that report mont

hly results posted a composite 3.4% gain, according to Thomson Reuters data.
Does this mean we are completely out of the woods? Not necessarily. For the most part, American wallets aren't fat enough to push the economic expansion into hyperdrive. Even the 1.8% wage growth mentioned above isn't enough to keep pace with current inflation rates. We still have a long way to go to reach our full potential, but things are moving in the right direction.

ECONOMIC CALENDAR:
Monday – Consumer Credit
Tuesday – Redbook
Wednesday – Wholesale Trade, Ben Bernanke Speaks at 9:30AM Eastern
Thursday – International Trade, Jobless Claims, Import and Export Prices, Treasury Budget
Friday – Consumer Sentiment
Data as of 11/04/2011 1-Week YTD 1-Year 5-Year 10-Year
Standard & Poor's 500 -2.48 -0.35 2.63 -1.63 1.53
Dow -2.03 3.50 4.80 0.00 2.85
NASDAQ -1.86 1.25 4.22 3.05 5.39
MSCI EAFE -6.24 -9.30 -10.4 -3.07 2.72
10-year Treasury Note (Yield Only) 2.31 N/A 2.48 4.72 4.35

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. N/A means not available.

HEADLINES:
U.S. stocks stayed under pressure with all major U.S. indexes falling about 2% for the week. Investors remained wary over whether Greece could default on its debt and what that might mean for the global financial system.

European leaders are hoping China will be a major contributor to a $1.4-trillion bailout fund, but many in the Asian nation are uncomfortable with that prospect. They don't think China should shift its foreign trove of U.S. Treasury bonds and debts of other nations to fund the financial recovery of Greece and some of its troubled Eurozone neighbors, analysts say. One reason: Europeans are still better off than Chinese.

A new national poll shows neither Wall Street nor Occupy Wall Street conjuring up strong favorable impressions among the American public. Among 1,005 adults surveyed, 35% had a favorable impression of the protest movement that began in New York City and gained support worldwide. Only 16% could say the same for Wall Street and large corporations. 29% had a favorable impression of the tea party movement and 21% for government in Washington.

QUOTE OF THE WEEK:
“Happiness depends more on how life strikes you than on what happens.” – Andy

Up, Down, Up… What Now for the markets?

2011-10-31T08:10:00.000-07:00

Up, Down, Up… What Now?

In its longest winning streak since January, the S&P 500 has rallied for four straight weeks, adding 14% in October alone. According to a Bloomberg article published on Saturday, this puts the index on track for its biggest monthly gain since 1974! The Dow Jones Industrial Average similarly scored an 11% gain this month and just logged its fifth week of gains.

In comparison with the near 20% decline we saw during July and August, it certainly seems like the stock market has a split personality. What‘s causing all these ups and downs? While many factors are at play, the market moved downward over the summer based primarily on two assumptions:

1) That the U.S. was entering another recession.

2) That the Eurozone financial system was on the verge of collapse.

When neither of these things occurred, investors became uncertain – waiting and watching every headline for signs of what would come next. This led to the heightened levels of volatility we experienced in September.

What led to the rally? Frankly, the crisis atmosphere has died down. European Union leaders announced a “deal” on debt crisis measures early Thursday that aims to resolve issues in Greece, instability in the banking sector, and their sorely deficient bailout fund. Equities also climbed after the government announced that the U.S. economy expanded 2.5% in the third quarter; its fastest pace in a year.

So are we out of the woods? Not completely. We are wise to temper our expectations for the moment, as many details about Europe’s plan and how it will be implemented still remain unsettled. Other factors are also worth keeping an eye on. Earnings season is still under way, and 100 more companies are set to report this week. The nation’s highly anticipated jobs report, due Friday, will be in focus. And as the Federal Reserve concludes its two-day meeting on Wednesday, investors will be watching for signals regarding whether a third round of quantitative easing, or QE3 is on the way.

As always, we pledge to monitor the relevant issues, and to keep you informed about any factors that have the potential to shape your financial future.

ECONOMIC CALENDAR:
Monday – Chicago PMI
Tuesday – Motor Vehicle Sales, ISM Manufacturing Index, Construction Spending
Wednesday – ADP Employment Report, FOMC Meeting Announcement
Thursday – Jobless Claims, Productivity and Costs, ECB Announcement, Factory Orders, ISM Non-Manufacturing Index,
Friday – Employment Situation

HEADLINES:
Treasury 30-year bonds dropped for a fifth week, the longest skid in more than two years, as a deal reached by European leaders to tame the region’s debt crisis fueled appetite for higher-yielding assets.

Europe’s appeal for Chinese help has come under fierce criticism for potentially weakening their negotiating position in political and economic disputes with Beijing. On Sunday, Eurogroup chairman Jean-Claude Juncker said it made sense for China to invest its surplus in Europe to help the region overcome its debt crisis, but this would not involve political concessions.

As stimulus funds dry up, cash-strapped states are facing steep rises in Medicaid spending, forcing them to slash services and trim costs. States will have to spend another 28.7% on Medicaid this fiscal year - by far the largest increase ever, according to new data released by the Kaiser Family Foundation Thursday.

Sales of new homes, a benchmark indicator both for the housing market and the overall economy, rose slightly but remained slow in September. Sales reached a 313,000 annual rate in September, 5.7% more sales than the revised estimate for August, according to a monthly report from the Census Bureau released Wednesday. But sales were off 0.9% compared with 12 months earlier.

QUOTE OF THE WEEK:
‘You are never too old to set another goal or to dream a new dream.” Les Brown

To think about:
It’s important to focus on one thing at a time. Even in the Roman times they understood this with their Proverb ‘The man who chase two rabbits catches none.”

RECIPE OF THE WEEK:
From Marcello’s
Penne Vodka e Radicchio

Penne Vodka e Radicchio
Penne with Pink Vodka Sauce and Radicchio, Serves 4
4 tbsp. extra virgin olive oil
2 small shallots, chopped
2 oz. Parmigiano Reggiano or Grana Padano
1/4 stick of butter
4 oz. heavy cream
1 lb. penne pasta
1 lb. radicchio, julienne
1 oz. vodka
2 cups tomato sauce
pinch of Italian red pepper
pinch of fresh parsley
In medium pan, sauté shallots and radicchio in butter and olive oil. Stir for 2-3 minutes. Add red pepper and vodka and flame it.
Gradually add tomato sauce and heavy cream. Cook for 10 minutes over low flame. Cook pasta and cook until al dente. Drain and stir in sauce. Garnish with Parmigiano and parsley.
Wine suggestion: Valpolicella/Amarone or one of Marcello’s favorites: Allegrini Palazzo della Torre

Share the Wealth of Knowledge!
Please share this market update with family, friends, or colleagues.If you would like us to add them to our list, simply click on the "Forward email" link below. We love being introduced!

If you would like to opt-out of future emails, please reply to this email with UNSUBSCRIBE in the subject line.

Insert your broker/dealer disclosures here. i.e. Securities offered through “Your B/D Name Here,” Member FINRA/SIPC.

Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.

Europe vs. Earnings for the markets

2011-10-24T08:19:00.000-07:00

Europe vs. Earnings for the markets

It’s an interesting time for the stock market. We’re in the middle of a healthy earnings season, economic news is modestly positive, and yet, investors can’t pull their eyes away from the drama in Europe.

On average, 60% of companies in the S&P 500 are beating earnings estimates since the reporting season began this month, and numbers for revenue are coming in even better. The number of people claiming unemployment benefits declined this week, housing construction picked up last month (at least for apartment buildings), and inflation remains low. Add to this the fact that many analysts are saying stocks are undervalued right now , and it would have been reasonable to expect a stock market rally last week. Instead, what we got was a roller coaster ride that eventually ended the week virtually flat. The Dow and S&P rose a little over 1%, while the Nasdaq fell 1%.

Europe is clearly dominating investor sentiment right now, leaving the markets vulnerable to every shred of bad news. With good news, we see stocks push upward. With bad news, they pull back. All of this pushing and pulling is keeping stocks in somewhat of a no man’s land where valuations look good but global economic concerns are scaring people away from them. At the moment we seem to be in a trading range.
Meanwhile, European leaders are scrambling to solve the crisis. And while the outcome of all their meetings is impossible to predict, expectations for a bold and reasonable plan are high. If a concrete plan comes together, it is likely that the markets will respond positively. If a plan doesn’t come together, the bumpy ride will probably continue.

While progress in Europe has been painfully slow, it is starting to look like their leaders are taking things more seriously. If nothing else, most would agree that we are closer to the end of this crisis than to the beginning. And that is definitely good news!

ECONOMIC CALENDAR:
Tuesday – S&P Case Shiller HPI, Consumer Confidence
Wednesday – Durable Goods Orders, New Home Sales
Thursday – GDP, Jobless Claims, Pending Home Sales Index
Friday – Personal Income and Outlays, Employment Cost Index, Consumer Sentiment

HEADLINES:
On Friday, President Obama announced that the United States would withdraw its forces from Iraq by the end of the year. Although the most heart-wrenching costs of the Iraq war come in the form of human lives, Obama's decision is also a major step toward putting the United States on a more sustainable fiscal path.
The U.S. Senate adopted a measure on Thursday that would raise the maximum size of a home loan backed by mortgage companies Fannie Mae, Freddie Mac, and the Federal Housing Administration to $729,750.

The Occupy Wall Street protests are rapidly spreading around the world. St. Paul's Cathedral has closed to the public because Occupy London Stock Exchange protesters camped outside, church officials said Friday.

Federal Reserve officials are starting to build a case for a new program of buying mortgage-backed securities to boost the economy, though they appear unlikely to move swiftly. The idea would be to target any new efforts by the central bank at the parts of the economy that are most severely impeding a recovery – the housing and mortgage markets – by working to push down mortgage rates.

QUOTE OF THE WEEK:

“Those who start with too litte money are more likely to succeed than those who start with too much.Energy and imagination are the springboards to wealth creation. “
Brian Tracy

RECIPE OF THE WEEK: From Marcello’s in Suffern
Tiramisu

1 lb. mascarpone cheese or cream cheese, plain
4 egg yolks
1 cup marsala wine, or any sweet wine
4 tbsp. sugar
10 oz. ladyfingers, or spongecake
3 cups espresso, or verystrong black coffee
cocoa to decorate
Mix sugar, marsala and eggs in copper bowl or double boiler and cook for 5 minutes. Let cool. This mixture is called zabaglione.
Blend the mascarpone cheese with the zabaglione until smooth.
Spread 1/3 of the cream mixture in the bottom of a square pan 2” deep. Dip the ladyfingers individually in espresso and place uniformly on top of cream mixture. Add another 1/3 of cream mixture and repeat another layer of ladyfingers. Add the last of the cream and refrigerate for 3 hours. Cut into squares and sprinkle with cocoa powder.

From Ken’s book Now What? A guide to Retirement during volatile times

Not Your Father's Retirement
Unlike your parents’ generation, most baby boomers have had more than one job or career, and don’t have a generous pension plan to fall back on at retirement. While the post war baby boomers do have some investments that were unknown to previous generations, like Roth IRAs and 401(k) plans, your parents had a safety net, while you must fly solo.

Overall, you’ll live longer and healthier lives than your parents, so you’ll need money for a longer period of time. To further complicate your financial burdens, you may have your own parents and children to care for and help support.

And you’ll likely have more energy and time for living out your personal retirement dreams, unlike many of our parents, who didn’t live long enough, or healthy enough, to enjoy their Golden Years to the fullest. You also have end of life decisions, needs, and opportunities that no generation before yours could benefit from ... or had to face.

Fill (Not Kill) Your Time
“Nobody on his deathbed ever said, ‘I wish I had spent more time at the office.’”
-- Paul Tsongas, the late senator from Massachusetts

Without the structure of that office where you dutifully reported 5 days a week … or more … you’ll have a lot of time on your hands, and a lot less that you have to do with it. Now that you can finally choose how you’ll spend your time, will you choose a new career, a part-time job, leisurely hours on the golf course, a stint back at school, volunteer work, travel, or all of the above?

Who you spend your time with matters as much as how you choose to spend that time. Sometimes, in the rush to succeed, we forget to involve our loved ones in the day to day activities of our working lives, or invest our time and energy in those people and things that matter most to us

Making the most of your relationships with loved ones now, be they friends or family, young or old, can make a huge difference in the quality of your retirement years. In the end, folks with close ties to family and friends tend to live longer, happier lives ... no matter how rich or poor they may be.

Share the Wealth of Knowledge!
Please share this market update with family, friends, or colleagues. If you would like us to add them to our list, simply click on the "Forward email" link below. We love being introduced!

If you would like to opt-out of future emails, please reply to this email with UNSUBSCRIBE in the subject line.
Insert your broker/dealer disclosures here. i.e. Securities offered through “Your B/D Name Here,” Member FINRA/SIPC.

Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.
These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative or named Broker dealer, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

By clicking on these links, you will leave our server as they are located on another server. We have not independently verified the information available through this link. The link is provided to you as a matter of interest. Please click on the links below to leave and proceed to the selected site.

2011-10-17T09:09:00.000-07:00

Is the market ready for a comeback?

Just a couple of weeks ago, on October 3rd, the S&P 500 was down 12.6% for the year and things weren’t looking too good for a comeback. Since that time, it has trimmed the loss to only 2.6% and needs to gain just 33 points to get above the 1,257 where it started the year. If the S&P 500 finishes this year with a gain, it will be its biggest comeback since 1984!

What has caused this turnaround? One reason is that investors are becoming more confident that Europe will protect its banks from huge losses on Greek bonds if that country fails to make good on its debt. Another reason is that many people still think stocks are undervalued and that company earnings are going to be better in the third quarter than many analysts expect.

Since July, analysts have continually cut their earnings estimates based on fears that the U.S. is heading into a recession. Much to their surprise though, positive reports on retail sales, applications for unemployment benefits, and the number of jobs added in August have been better than expected. So while some have been pricing the market in expectation of the worst, things haven’t been as bad as many expected.
Seasonal investor behavior could also be at play here. If you look at the 30-year time period from 1981-2010, you will find that the average price return for the S&P 500 Index has been 7.14%. While this is significant, it is even more impressive that the index ended positive 24 out of 30 years, or 80% of the time! "Positive market psychology hits a fever pitch as the holiday season approaches and does not begin to wane until the spring," according to the Stock Trader's Almanac.

While Europe’s debt problems still aren’t solved, and it is definitely too early to count on gains for the year, we are happy to see this positive momentum in the stock market and hope it continues.

ECONOMIC CALENDAR: Monday – Empire State Mfg Survey, Industrial Production
Tuesday – Producer Price Index, Treasury International Capital, Housing Market Index, Ben Bernanke Speaks at 1:15 PM ET
Wednesday –Consumer Price Index, Housing Starts, EIA Petroleum Status Report, Beige Book
Thursday – Jobless Claims, Existing Home Sales, Philadelphia Fed Survey, Leading Indicators

Data as of 10/14/2011 1-Week YTD 1-Year 5-Year 10-Year
Standard & Poor's 500 5.98 -2.63 4.33 -2.07 1.22
Dow 4.88 0.58 4.93 -0.53 2.46
NASDAQ 7.60 0.56 9.55 2.63 5.66
MSCI EAFE 6.41 -8.74 -7.08 -2.96 2.64
10-year Treasury Note (Yield Only) 2.07 N/A 2.49 4.81 4.66

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. N/A means not available.

HEADLINES:

Earnings season is in full swing as the week ahead includes reports from nearly half of the Dow's 30 components, including Intel, McDonald's, and General Electric, and 96 members of the S&P 500 including, Apple, Southwest Airlines, and Chipotle Mexican Grill. S&P 500 company earnings are expected to have climbed 23% in the third quarter of 2011, according to earnings tracker Thomson Reuters. Revenues of the companies in the benchmark index are expected to have risen 10%.

France and Germany have less than a week of frantic negotiation ahead to resolve key differences on a “comprehensive plan” to end the Eurozone sovereign debt crisis after the world’s leading finance ministers put the ball firmly in their court over the weekend. The Group of 20 richest nations told the Eurozone that by the European summit next Sunday it should: agree on the losses the private sector should take on Greek debt; arrange a credible plan for the recapitalization of Europe’s banks; and install a firewall to protect other countries from Greece’s woes.

Throngs of Apple fans lined up in the wee hours Friday outside the company's flagship store in Manhattan to be among the first to get their hands on the new iPhone 4S. Two hours before Apple's new smartphone was slated to go on sale, hundreds of aspiring buyers filled the plaza outside the Fifth Avenue glass cube, echoing scenes that had already played out earlier in the day in Australia, Japan, Germany, France, and other Apple stores around the world.

Investors are hoping for a 4th quarter rally

2011-10-10T09:10:00.000-07:00

Investors are hoping for a 4th quarter rally

The S&P 500 has produced a positive total return in the 4th quarter (i.e., October-November-December) in 16 of the last 20 years (i.e., 1991-2010), including a +10.7% gain last year. The S&P 500 is an unmanaged index of 500 widely held stocks that is generally considered representative of the US stock market (source: BTN Research).

The Bureau of Labor Statistics released its monthly Employment Situation Summary on Friday, and the data conclusively proves that the U.S. is not in a recession. To many the data would seem to indicate that it also shows that the odds of entering into one are much lower than some reports in the media might suggest.

Nonfarm payroll employment edged up by 103,000 in September, and increased by 202,000 if you include upward revisions for July and August. This significantly outpaced consensus expectations of a mere 60,000 gain. And while the report reflected the return of about 45,000 Verizon workers who had been on strike in August, the increases are still significant. Also striking is the fact that the number of weekly hours per worker increased from 34.2 to 34.3. While that may not seem like much of a jump, it is actually the equivalent of adding 320,000 jobs!

If you take a look at the jobs numbers over the past year, you will see that private sector payrolls have grown by 1.8 million, the workweek has lengthened, and hourly wages are up 1.9%. And while we acknowledge that the labor market is still far from operating at an optimal level, we are definitely seeing improvement!

As we hope this positive trend in hiring will continue, only time will tell if it can be more than a momentary bright spot. In the weeks ahead, investors will be looking for signs on the health of the economy from corporate earnings and what is still the biggest elephant in the room: Europe’s debt crisis. We will continue to monitor developments in these and other areas and will work diligently to keep you informed.

ECONOMIC CALENDAR: Monday – U.S. Holiday: Columbus Day
Tuesday – FOMC Minutes
Thursday – International Trade, Jobless Claims, EIA Petroleum Status Report, Treasury Budget
Friday – Retail Sales, Import and Export Prices, Consumer Sentiment, Business Inventories

Data as of 10/07/2011 1-Week YTD 1-Year 5-Year 10-Year
Standard & Poor's 500 2.12 -8.12 -0.22 -2.88 0.78
Dow 1.74 -4.10 1.41 -1.26 2.17
NASDAQ 2.65 -6.54 4.01 1.56 5.44
MSCI EAFE 2.51 -14.2 -10.8 -3.51 2.32
10-year Treasury Note (Yield Only) 1.92 N/A 2.40 4.70 4.50

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. N/A means not available.

HEADLINES:
Steve Jobs, the co-founder and board chairman of one of the world’s greatest companies, will long be remembered as a remarkable man. We have truly lost a great visionary who enriched the lives of millions by means of technology. Born in 1955 to a world of rotary phones and room-sized computers, he left behind a world where over 100 million people carry a small device called an iPhone – which is both a phone and a computer – in their pockets. Steve Jobs is a man who will unquestionably be missed.

Business-jet sales may increase worldwide starting in 2012 as emerging-market demand picks up. Purchase expectations are growing in Asia, followed by the Middle East and Africa, while the free-fall in developed markets like North America following 2008’s recession has stabilized, according to an annual survey of 1,500 companies by Honeywell International Inc., a New Jersey-based avionics and cockpit-instruments maker.

Consumers cut their borrowing in August by the most in 16 months. Fewer people used their credit cards. And a measure of demand for auto and student loans fell. Total borrowing dropped $9.5 billion in August, the Federal Reserve said last week. In July, borrowing increased $11.9 billion.

While the nation added jobs last month, public schools lost 24,400 positions – the most of any category. Local government in total shed 35,000 jobs. Teachers continue to get pummeled as state and local governments digest budget cuts for fiscal 2012, which began in July in most states.

QUOTE OF THE WEEK:

Worse Quarter since the Fall 2008, What’s next?

2011-10-03T07:49:00.000-07:00

Worse Quarter since the Fall 2008, What’s next?

The Market had it’s worse quarter since 2008. The leading averages have now been down five months in a row. The S&P 500 lost 14% for the 3rd quarter. European markets lost 23% for the same period. Here is a recap of the past 3 months:

July – After a volatile first half that eventually ended U.S. stocks in positive territory, the debt ceiling debate quickly took center stage. As policymaker’s debated ways to cut spending and raise the nation’s borrowing limit, stock markets faltered.

August – Following an eleventh hour debt ceiling compromise, Italy rose to the forefront of debt problems in Europe and anemic economic news pushed investor sentiment downward. As fear dominated the markets, major indexes erased their gains for the year during the first week of the month. Hitting especially close to home, S&P downgraded the nation’s bond rating from AAA to AA+ on August 5th.

September – After a brisk market rally early in the month, European debt woes dominated investor sentiment once again. By the middle of the month, tables turned dramatically as many asset classes experienced their worst weeks in years. Even gold faced its largest monthly fall since October 2008. In conjunction with persistent concerns about European debt and a weakening U.S. economy, the Fed's Open Market Committee (FOMC) launched “Operation Twist” on September 21st, leading to further selloffs.

In reading the quick summary above, it’s easy to see why investors could be forgiven for feeling somewhat dazed and confused. The last three months have been rough. The stream of bad news coupled with occasional flickers of optimism led to one of the most volatile periods ever for stocks. The Dow moved more than 200 points on 18 separate times during the quarter, swinging by more than 400 points on four consecutive days in August alone. When you couple the nauseating stock market performance with anxiety about the European sovereign-debt crisis and headlines forecasting a double-dip recession, it’s no wonder people are running scared.
Now What?

While past performance doesn’t guarantee future results, some investors are taking comfort in the fact that the third-quarter, historically, has been the worst of the year, and the fourth-quarter is typically the best. And while some are finding it difficult to be optimistic, others are turning their sights to corporate earnings for a barometer of where the economy is headed. Companies will start releasing their third-quarter reports in coming weeks.

Interestingly, the third-quarter edition of the Investment Manager Outlook (a survey of investment managers conducted by Russell Investment Group and released 9/29) found that 78% of managers do not expect the U.S. to slide into a double-dip recession. “Strong corporate balance sheets and high corporate profits should ensure that the United States avoids a new recession. However, Russell also believes, along with the majority of the managers surveyed, that we will see a slow-growth trend for the next several years, as well as ongoing market volatility,” the report stated. We agree with this assessment.

As long as confidence in the global economy and government policymakers remains shaky, markets are likely to be volatile. Even so, we still believe that fundamentals are strong in many areas, and we know that successful investing is a long-term project undertaken with risk and uncertainty. Equity markets do not move in a straight line, and neither do economic recoveries. Despite being painful, volatile periods like this historically run their course and then come to an end.
We understand that fear can be contagious, but we urge you not to let yourself be overtaken by it. While many types of investments are currently experiencing a difficult period, we believe that those who remain committed to their long-term investment plan will be rewarded over time.

If you have any questions or would like any guidance, please don’t hesitate to reach out to us. We consider it a great privilege to help you protect what you’ve worked hard to earn.

ECONOMIC CALENDAR: Monday – ISM Mfg Index, Construction Spending
Tuesday – Motor Vehicle Sales, Factory Orders
Wednesday –ADP Employment Report, ISM Non-Mfg Index, EIA Petroleum Status Report
Thursday – BOE Announcement, ECB Announcement, Jobless Claims
Friday – Employment Situation
Data as of 09/30/2011 1-Week 3Q YTD 1-Year 5-Year 10-Year
Standard & Poor's 500 2.11 -14.3 -7.73 1.68 -2.63 1.15
Dow 3.55 -12.1 -3.66 3.39 -0.90 2.61
NASDAQ -0.10 -12.9 -6.49 4.73 1.97 6.55
MSCI EAFE 4.81 -17.8 -13.4 -7.33 -3.26 2.64
10-year Treasury Note (Yield Only) 1.81 N/A N/A 2.52 4.63 4.57

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. N/A means not available.

HEADLINES:

According to a Bloomberg Gallup Poll, 63 % of global investors approve of President Barack Obama's plan to tax people with annual incomes of $1 million or more. The so-called Buffett rule is a nod to investor Warren Buffett and his New York Times op-ed piece calling on the wealthy to pay their fair share.

Consumers made less money and spent less money in August, according to a report released Friday. The Commerce Department said personal income declined by 0.1% in August. Consumer spending rose just 0.2%, and was flat when adjusted for inflation.

An examination of credit-rating agencies by the Securities and Exchange Commission staff found repeated instances of the companies failing to follow their own procedures or adequately manage conflicts of interest, according to an S.E.C. staff report issued Friday. The examinations were mandated in the Dodd-Frank regulatory law passed last year after numerous investigations into the causes of the financial crisis. Several of those inquiries found that the rating agencies issued inaccurate reports, failed to report or manage conflicts of interest, and put generating revenue ahead of rigorous financial analysis.

Eurozone inflation has surged unexpectedly to a three-year high of 3%, adding to the dilemma facing the European Central Bank as an escalating debt crisis pushes the region towards recession.

Market sell off has investor’s concerned

2011-09-26T08:18:00.000-07:00

Market sell off has investor’s concerned

After the brisk market rally we experienced two weeks ago, the tables turned dramatically last week as many asset classes experienced their worst week in years. The Dow tumbled 6.4%, the S&P 500 fell 6.5%, and the Nasdaq slid 5.3%. Even gold shed nearly 10% over the course of the week for its biggest drop on a percentage basis in 28 years.

In conjunction with persistent concerns about European debt and a weakening U.S. economy, the presumed trigger for the panic was that the Fed's Open Market Committee (FOMC) launched “Operation Twist” on Wednesday. The move, designed to bring interest rates down and stimulate the housing market, scarcely proved to reassure investors. “Operation Twist” calls for the Fed to sell short-term securities (maturing in three years or less) from its sizeable $1.7 trillion holdings of government debt and use the $400 billion raised to buy longer-term mortgage-backed securities maturing in six to 30 years.

At the same time, the Fed accompanied its announcement with a lukewarm (at best) assessment of the economy. While stating that they continue to expect some pickup in the pace of recovery over coming quarters, they cited “significant downside risks to the economic outlook, including strains in global financial markets.”
While the stock market has undeniably taken a big hit, and investor confidence has been badly shaken, few things fundamentally changed from two weeks ago. In essence, market participants reacted to renewed concerns that policymakers aren’t doing enough to stabilize the global economy.

Notably, the Group of 20 major economies, including the United States, European Union, and China, issued a statement Thursday saying that it stands committed to "take all necessary actions to preserve the stability of banking systems and financial markets as required."

It is likely that we will continue to experience a period of volatility as investors wait to see if the words of policymakers lead to tangible actions.

ECONOMIC CALENDAR: Monday – New Home Sales Tuesday – S&P Case-Shiller HPI, Consumer Confidence Wednesday –Durable Goods Orders, EIA Petroleum Status Report
Thursday – GDP, Jobless Claims, Pending Home Sales Friday – Personal Income and Outlays, Chicago PMI, Consumer

Sentiment
Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. N/A means not available.

HEADLINES:

Last week, the government released the latest census report showing the poverty rate rose to a 17-year high. A whopping 46.2 million people (or 15.1% of the U.S. population) live in poverty, and 49.9 million live without health insurance.
BP is preparing its rigs and workers to resume full drilling operations in the Gulf of Mexico, seeking to end a 17-month production slump following the worst U.S. oil spill.

The International Monetary Fund annual meetings wrapped up in Washington on Sunday with no immediate consensus on the solution. Participants said they were waiting for the ratification of the action plan agreed on July 21 by the Eurozone, particularly by the German Bundestag this week, before starting serious negotiations on increasing the rescue fund’s firepower or asking for a bigger write-down in private sector holdings of Greek debt.

For the first time in months, retail gasoline prices have fallen below $3 a gallon in places, including parts of Michigan, Missouri, and Texas. And the relief is likely to spread thanks to a sharp decline in crude-oil prices. The national average for regular unleaded gasoline is $3.51 per gallon, down from a high of $3.98 in early May. Last week's plunge in oil prices could push the average to $3.25 per gallon by November, analysts say.

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Introducing Ken’s new book: Can I Retire?

2011-09-19T08:06:00.000-07:00

Introducing Ken’s new book: Can I Retire?

http://caniretirebook.com/

If you would like a Free Copy, please email us your name and address

Excerpts from the book:

“Where you go and what you do after you retire all depends on the individual. Whether its travel, volunteering, spending time with family or friends, there’s no end to what you can do once you’ve retired. As long as you’ve planned and prepared for it as best you can by budgeting, consulting with advisors, investing and comparing plans, then your golden years should be both merry and bright.” – Ken Mahoney

A lot of people make the mistake of embarking on their retirement years without their family’s support, or without thinking it through all the way. That’s the first mistake they make, and one that can cost them a smooth transition into retirement. Don’t be one of the people who make so many mistakes during their first year of retirement and spend several more years just making up their losses, which, with the benefit of hindsight, they could have avoided.

While many books discuss retirement in terms of accumulating wealth, it is equally important to consider how you see yourself in retirement – where you would like to live, what activities you would like to pursue and the associated costs. Once you understand what you want in terms of lifestyle, I think you'll start looking forward to answering the question, “Can I retire?”

Can I retire? Most people today make that decision predicated on their financial situation. But there are other components of retirement I would like you to consider. Most importantly, I would like you to consider having purpose in your life during retirement. The transition of going from working to retirement or from structured to non-structured can be difficult. So it’s important to “transfer” the structure of the “work world” to your own new structure of retirement.

What people are saying about Can I Retire?

This review is from: Can I Retire? (Your Personal Guide To Retirement) (Paperback)
I'm 46 years old and need to be thinking about my "golden years." From what I can see, they aren't always golden for retirees, especially not financially. I want to plan now and yet I wasn't sure where to begin. Can I Retire? (Your Personal Guide To Retirement) was exactly what I needed right now. It helps me get a feel not only for the sum I'll have to live on but also enables me to plan around contingencies such as problems in the future, health situations, and so on. I NEVER would have taken into account all the factors that go into retirement with this book. I do feel kind of smothered by what is in store for me now that I am working out my plan, but I would much rather feel like a "dummy" now than when I'm 65 and have nothing!!! NOW I have time to actually WORK MY PLAN and that's what I'm going to do.

This review is from: Can I Retire? (Your Personal Guide To Retirement) (Paperback)
Just getting by day to day is more of a financial challenge than it's been in several generations but RETIREMENT? Extremely hard especially when we might not be able to rely on social security. We are nearing retirement and have some saved but we certainly have a ways to go before we could ever consider stop working if we want to maintain an okay-to-decent lifestyle. I was thrilled with Can I Retire because the author, Ken Mahoney, obviously knows his stuff and has counseled many people before. His writing is clear and concise and he answers questions people like us - complete novices when it comes to financial stuff like "derivatives" and things like that! - have. For example, what helped us the most is how he guards us against retiring without knowing exactly where we stand before doing so and without having a plan. Too many retirees have found they have to come OUT of retirement to make ends meet and who wants to do that???

This review is from: Can I Retire? (Your Personal Guide To Retirement) (Paperback)
I loved the book. It was filled with smart, practical ideas that anybody can do in preparation for retirement. I recommend the book to anyone young or old, looking for ways to be smart about their money before and after retirment

Ten years later

2011-09-12T07:41:00.000-07:00

Ten Years Later

For most of us, 9/11 feels like yesterday. For a younger generation, Sunday’s services etched a memory of that day onto minds too young to recall it. Three-thousand-six-hundred and fifty-two days have since passed, but as New York City Mayor Michael Bloomberg so poignantly stated, “We can never un-see what happened here.” While most Americans wish they never had to witness the events of that defining day, they are equally determined never to forget them.

The 10th anniversary closed a decade that witnessed two wars, massive changes in national security, the Great Recession, and most recently, the death of the elusive terrorist who masterminded the attack. And no longer is ground zero merely a reminder of what was, but a symbol of rebirth. With the breathtaking National September 11 Memorial now open and the yet-to-be-finished Freedom Tower rising 961 feet above the street where 2,983 lost their lives, history remembers the resilience of the human spirit.

The financial world also stands changed by the events of September 11. Once the physical financial center of the country, the area near ground zero has become largely an upscale residential neighborhood. Pre 9/11, tourists could visit the New York Stock Exchange and stand in a galley to watch the trading, but not anymore. Even though the building itself sustained no damage when the Twin Towers fell, the exchange has since been considered a target and the visitor center remains closed. On the floor of the exchange, traders must now go through security barriers and x-ray machines under the watch of armed officers – something those who have flown on a commercial airliner since 9/11 can relate to.

While Sunday marked a day of reflection and tears for many of us, and while both the tragedy and heroism of 9/11 will long be remembered, Americans will move forward this week. Concerns surrounding Europe’s debt crisis will rear their ugly heads again, and headlines about stock market volatility will doubtless be featured in the news. And when they are, we would all do well to keep things in perspective and be thankful for the life we enjoy, even if it has been altered by the events of September 11th, 2001.

HEADLINES:
Moments of silence were observed in New York City Sunday on the 10th anniversary of the terror attacks that destroyed the World Trade Center and killed nearly 3,000 people. "Ten years have passed since a perfect blue sky morning turned into the blackest of nights. Since then, we have lived in sunshine, and in shadow," said New York City Mayor Michael Bloomberg.

China’s record imports and a rebound in lending signaled strength that offers a bright spot in a global economy contending with Europe’s debt crisis and weakening U.S. job gains. Government reports in the past two days showed that shipments from abroad jumped 30% and new local-currency loans were a more-than-forecast 548.5 billion yuan ($86 billion).

The average price for regular gasoline at U.S. filling stations rose 5.76 cents to $3.6669 a gallon last week.

Bank of America Corp. is preparing to slash 40,000 or more jobs and close 10% of its branches nationwide. The details of the plan were not officially announced, but the information was disclosed by three Bank of America executives who have been briefed on the plan but were not authorized to speak publicly.

Unemployment and the stock market explained

2011-09-06T08:34:00.000-07:00

Unemployment and the stock market explained

The big news last week centered on the August jobs report, which was disappointing to say the least. Non-farm payrolls were unchanged in August but down 58,000 including revisions to June/July. The consensus expected a gain of 68,000. The unemployment rate remained unchanged at 9.1%.

U.S. stocks tumbled 2% on Friday in reaction to the news, as headlines showing zero jobs growth in August fueled investor concerns. And while the August numbers are certainly not attractive, there are a few underlying factors we would like to draw your attention to.

One of the reasons August’s numbers were so weak has to do with the Verizon strike, now over, that temporarily sidelined 46,000 workers. Were it not for that strike, private payrolls would have been up 62,000 including revisions. As it stands, workers on strike are counted as unemployed when they go on strike and are added as newly employed when they go back to work. Now that they have returned to work, a future employment report will show an increase of 46,000. It’s strange how the system works isn’t it?

There was also some positive news in Friday’s report. Civilian employment, an alternative measure of jobs that includes start ups, increased 331,000 in August, which is very encouraging. In general, when new businesses are starting up and hiring workers, it means the wheels of capitalism are turning in the right direction.

If you only look at the totals, it’s easy to say there was no employment growth in August, which is how most of the headlines read. But if you take time to look below the surface, a more balanced picture emerges. Much of August’s weakness can likely be attributed to financial turmoil in Europe, large swings in the stock market, and lawmaking that has brought much uncertainty to the hiring arena.

Although recession fears are still lingering, recent reports on auto sales, manufacturing and consumer spending suggest that the economy is still growing, albeit slowly. We believe future jobs reports will reflect that.

ECONOMIC CALENDAR: Monday – U.S. Holiday: Labor Day Tuesday – ISM Non-Mfg Index Wednesday – Beige Book
Thursday – BOE Announcement, ECB Announcement, International Trade, Jobless Claims, EIA Petroleum Status Report
Data as of 09/02/2011 1-Week YTD 1-Year 5-Year 10-Year
Standard & Poor's 500 -0.24 -6.65 7.69 -2.09 0.36
Dow -0.39 -2.91 8.92 -0.39 1.30
NASDAQ 0.02 -6.50 12.7 2.62 3.74
MSCI EAFE 0.08 -9.42 2.35 -2.58 2.14
10-year Treasury Note (Yield Only) 2.19 N/A 2.63 4.73 4.82

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. N/A means not available.

HEADLINES:
Bank of America Corp. and 16 other big banks have been hit with multiple accusations of securities-law violations and negligence in a series of lawsuits tied to more than $50 billion in mortgage securities. The lawsuits, filed late Friday by the Federal Housing Finance Agency, accuses lenders of selling bad mortgage securities to government-sponsored housing companies Fannie Mae and Freddie Mac.

The euro came under significant pressure in European trading Tuesday, pulling down other sentiment-sensitive currencies, such as the pound and Australian dollar, with it. A steady flow of negative newsflow out of the euro zone pushed it down about 0.6% – a big move for a major currency – against the dollar.

Though oil prices fell to near $88 a barrel Friday, crude has jumped about 16% since August 9th, bolstered by signs industrial production in the U.S. continues to expand. The Institute for Supply Management said Thursday that U.S. manufacturing grew for the 25th straight month while analysts had expected a contraction.
About 70,000 households and businesses along the Eastern Seaboard who lost power during Irene remain without it a week after the storm.

Markets trying to figure out where the economy is headed

2011-08-15T13:09:00.000-07:00

Markets trying to figure out where the economy is headed

A recent article from the New York Times that was reprinted by CNBC, likened the late-2000s recession to an earthquake, and recent volatility to aftershocks. The article said: “Like earthquakes, financial crises seem to be accompanied by aftershocks, like the one we’ve been living through this week.
They can feel every bit as bad as the crisis itself. But economic history and academic research suggest they can set the stage for a sustainable recovery — and eventual sharp stock market gains.” We found this to be a particularly fitting illustration, and a valid point.

It’s no secret that dizzying stock market moves in recent weeks have been difficult to stomach. Think of all the events we’ve had to face leading up to this – controversy in Washington over the debt ceiling, Standard & Poor’s downgrade of America’s prized credit rating, renewed fears about European debt, and a gut-wrenching plunge in the stock market. The uncertainty of everything culminated in the wild ride we took last week.

To recap: On Monday the Dow Jones Industrial Average fell almost 635 points, then rose nearly 430 points on Tuesday, only to see another drop of almost 520 points on Wednesday. Helped by some positive earnings results, the Dow soared 423 points Thursday and another 125 points on Friday. By week’s end, the benchmark index had closed at 11,269 and shed only 1.5% for the week. The S&P 500 Index logged similar performance.
You might want to take a deep breath after reading this paragraph.
Do we expect a measure of volatility to continue? There is a good possibility that it will, at least for a time. As long as confidence in the global economy and government policymakers remains shaky, markets are likely to be volatile. Even so, we still believe that fundamentals are strong, and we know that successful investing is a long term project undertaken with risk and uncertainty. Equity markets do not move in a straight line, and neither do economic recoveries. Despite being painful, volatile periods like this historically run their course and then come to an end. To quote an ancient proverb, “this too shall pass.”

ECONOMIC CALENDAR: Monday – Empire State Mfg Survey, Housing Market Index
Tuesday – Housing Starts, Import and Export Prices, Industrial Production Wednesday –Producer Price Index
Thursday – Consumer Price Index, Jobless Claims, Existing Home Sales, Philadelphia Fed Survey, Leading Indicators

Data as of 08/12/2011 1-Week YTD 1-Year 5-Year 10-Year
Standard & Poor's 500 -1.72 -6.27 8.79 -1.39 -0.10
Dow -1.53 -2.66 9.20 0.33 0.82
NASDAQ -0.96 -5.46 14.5 4.38 2.82
MSCI EAFE -1.56 -7.37 6.98 -1.45 2.06
10-year Treasury Note (Yield Only) 2.56 NA 2.73 4.97 5.02

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. NA means not available.

HEADLINES:
Italy's government has approved sharp budget cuts demanded by the European Central Bank despite regional opposition to the move. Italian officials said Friday the austerity measures include $28 billion in cuts next year and $35 billion in 2013.
The number of Americans claiming new jobless benefits fell to a four-month low last week, the Labor Department said in its weekly report, providing a ray of hope for the nation’s battered economy. Initial claims for state unemployment benefits fell 7,000 to a seasonally adjusted 395,000, the Labor Department said, the lowest level since early April. Economists had expected a reading of 400,000.

The tumbling price of crude oil this month and signs of falling fuel demand point to lower U.S. gasoline prices ahead, though consumers will have to wait for savings to trickle down to the pump. After reaching an almost three-year high of $3.97 a gallon in early May, U.S. retail gasoline prices have fallen nearly 30 cents on a combination of lower oil prices and flagging sales in the important summer-driving season.

The Securities and Exchange Commission has asked credit rating agency Standard & Poor’s to disclose who within its ranks knew of its decision to downgrade U.S. debt before it was announced last week, as part of a preliminary look into potential insider trading, people familiar with the matter say.

Important Perspective on Recent Market Events

2011-08-08T09:01:00.000-07:00

Important Perspective on Recent Market Events

As you are surely aware, following Tuesday’s debt ceiling compromise, attention quickly shifted to whether the government has what it takes to solve its budget problems. Add to this the fact that Italy is now in the forefront of debt problems in Europe and anemic economic news has been pushing investor sentiment downward, and you have a near-perfect recipe for a stock market correction. And a correction – defined as a 10% drop from recent highs – is exactly what we experienced last week as major indexes erased their gains for the year. At times like this, we are wise to view events in the proper context and avoid letting brief periods of negativity derail our long-term strategies.

Market corrections are not unusual events. From the market lows of July 2010 to the highs of April 2011, the S&P 500 was up over 26% without experiencing a correction. To put that 26% run-up in perspective, the best 20-year time period for the stock market was 1948-1968, and the market only returned an average of 8.4% annually during that period. This illustrates that we were overdue for a correction. During recovery periods, stocks are prone to sudden declines in value. Unexpected drops in the market can be painful, but they are part of the healing process.

In our assessment, the turmoil of recent weeks reflects the fact that fear is still dominating investor sentiment. What are people afraid of? While there are several factors that could be cited, we believe debt problems domestically and abroad are in the forefront.

While it is true that European countries have spent themselves into a corner, correcting this mistake will be good for long term growth, not bad. While some financial institutions may face losses in the process, the minimal level of European exposure U.S. banks have, makes them well equipped to face this challenge. Our research tells us that the odds of significant damage to the U.S. economic system resulting from European debt failures are very low.

Closer to home, although S&P downgraded the nation’s bond rating from AAA to AA+, Moodys Investors Service took the opportunity to reaffirm the United State’s AAA rating. The U.S. now has a split rating from the two largest ratings agencies. The third-largest ratings agency, FitchRatings, also agreed with Moody’s AAA rating.

In confirming the AAA rating, Moody's recognized that the budget compromise is a first step toward achieving long-term fiscal improvement. The legislation passed on August 2nd calls for $917 billion in specific spending cuts over the next decade and established a congressional committee charged with making recommendations for achieving a further $1.5 trillion in deficit reduction over the same time period.
Successful investing is a long term project undertaken with risk and uncertainty. Equity markets do not move in a straight line, and neither do economic recoveries. We wish we had the ability to trade every move, but that just isn’t possible. We encourage you to tune out the media fanfare and remember that we have been through much worse. Please try to see recent events in context and do not allow them to disrupt your long term financial objectives.

ECONOMIC CALENDAR: Tuesday – Productivity and Costs, FOMC Meeting Announcement Wednesday – EIA Petroleum Status Report, Treasury Budget
Thursday – International Trade, Jobless Claims Friday – Retail Sales, Consumer Sentiment, Business Inventories
Data as of 08/05/2011 1-Week YTD 1-Year 5-Year 10-Year
Standard & Poor's 500 -7.19 -4.63 6.53 -1.25 -0.12
Dow -5.75 -1.15 7.21 0.36 0.89
NASDAQ -8.13 -4.54 10.4 4.29 2.26
MSCI EAFE -8.47 -5.90 3.19 -1.36 1.91
10-year Treasury Note (Yield Only) 2.81 NA 2.91 4.90 5.16

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. NA means not available.

HEADLINES:
Treasury Secretary Timothy F. Geithner will not be stepping down, a Treasury Department official said Sunday, ending speculation that the key Obama administration advisor was preparing to resign.

It was announced Friday that the Postal Service lost $3.1 billion in the April through June period and could be forced to default on payments due to the federal government when the fiscal year ends in September. Several bills designed to change the law governing the post office, an independent government agency, are pending in the House and Senate.

After reaching a near-record $3.98 in May, tumbling in June, and rising throughout the month of July, gasoline prices finally settled around $3.70 a gallon in early August.

The job market strengthened in July, a welcome piece of good news that sharply contrasted other recent data pointing toward an economic slowdown. Employers added 117,000 jobs last month, easily topping the 75,000 gain economists surveyed by CNNMoney had predicted. And the unemployment rate improved slightly to 9.1%.

AN EXCERPT FROM MY LATEST BOOK, CAN I RETIRE

2011-08-01T08:31:00.000-07:00

AN EXCERPT FROM MY LATEST BOOK, CAN I RETIRE
LIVING BETTER FOR LESS

Since you’re a few years off from retiring you should begin enhancing your savings by reducing your expenses, this way you can also lower the amount required after you retire. The less you need for your retirement income, the more you can save for the unexpected. Knowing by how much you can lower your living expenses all depends on your needs but you can reduce your expenses three different ways:

- Find a cheaper alternative to getting what you already need. This refers back to the section on comparison-shopping, as it’s not just for food or clothing, it relates to car insurance, travel, vehicles, and gasoline as well. If you can get what you require for a lower price than your retirement income will be lower than what has been estimated thus far.

- Eliminate debts and unnecessary expenses. As already discussed, it is important to reduce your debts as far down as they can go and cut costs on expenses that are not needed. What counts as an unnecessary expense all depends on the person. Most people like to drink beer or wine but that doesn’t mean you have to drink the most expensive bottle out there. Find a cheaper made beverage that still
tastes just as good and save what’s left over for other, more important things.
-
Move to where the cost of living is cheaper. Moving from a big city is an expense in and of itself, especially if you rely on public transportation. However, it can end up costing you more to live there than in the boonies, especially since the cost of homes in smaller places is nowhere near as high as they are in the city. This is because there are more people per square inch living in cities than there are living in towns or the boons. There’s a reason people prefer living in Brooklyn and commuting to New York City each day, and it’s not because they love the hassle of public transit.

Living on a modest income as a retiree is doable. The average amount recorded as of late that those retired are living off of is about $25,000 a year, which is 50% less than the normal family living on an estimated $47,000 per year. The problem is that those of heading into the luxury of retirement are living in a much different economy that your grandparents or even your own parents. The recession has made things more challenging for all, thus why even those who had planned for contingencies had to find a way to increase their retirement income and some had to go back to working for a while before things settled back down.

Although not intending to frighten anyone when I say this, the fact of the matter is that the economy is still not yet fully recovered from the recession and another one is a possibility in the future. That is why it is important to try and live off of as little as you actually need right now and plan for the possibility of needing more after you retire than originally thought of. You’re retirement budget should be realistic and factor in any possible contingencies from needing long-term medical care, to being pulled back into an economic slump.

Most market observers believe debt ceiling will be raised

2011-07-25T09:56:00.001-07:00

Most market observers believe debt ceiling will be raised

With less than two weeks until the August 2 deadline for raising the debt ceiling, investor focus has been glued to the debate. Lawmakers have been negotiating ways to cut spending and raise the nation’s borrowing limit for months, but there is still no articulated path forward. Treasury Secretary Timothy Geithner said Sunday on CNN's State of the Union, "We're almost out of runway. We're not nowhere, but we're almost out of runway." In the days ahead, markets around the world will be looking for reassurance that the U.S. political system can compromise on solutions for the greater good.

Helping to balance uncertainty in Washington, last week was one of surprisingly positive earnings reports that lifted major indexes to weekly gains. The Dow rose more than 1% and the S&P 500 and Nasdaq more than 2%. Analysts also cited relative progress on both the U.S. debt ceiling issue and the ongoing European debt crisis as partial reasons for the positive results.

This week promises to be a busy one both for stocks and economic reports.180 companies in the S&P 500 are scheduled to report quarterly financial results; the August 2 deadline for raising the debt ceiling is rapidly approaching; and Friday will bring the first official report on second-quarter economic growth.

With everything featured in the headlines right now, we understand that you may have some concerns about how your investments could be affected. Please rest assured that we are closely monitoring all relevant activity and will keep you informed about any steps that need to be taken. At the same time, we would like to reiterate that we do not believe now is the time for drastic action. If you have questions or would like additional information, please feel free to contact us. We are always here to lend a hand.

Data as of 07/22/2011 1-Week YTD 1-Year 5-Year 10-Year
Standard & Poor's 500 2.19 6.95 23.0 1.69 1.11
Dow 1.61 9.53 22.9 3.34 1.99
NASDAQ 2.47 7.76 27.3 8.30 4.09
MSCI EAFE 3.44 5.38 21.5 1.95 3.49
10-year Treasury Note (Yield Only) 2.91 NA 2.93 5.05 5.11

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. NA means not available.

HEADLINES:
The dollar fell as U.S. lawmakers failed to agree on raising the nation’s $14.3 trillion debt ceiling. America’s currency weakened against the Swiss franc, yen and euro.

Investors outside the U.S. own $4.51 trillion in U.S. Treasuries, or about 50% of the marketable government debt outstanding, according to the Treasury Department.
Last week marked the first anniversary of the Dodd-Frank Wall Street Reform and Consumer Protection Act. Dodd-Frank’s crucial innovation was to identify sources of systemic risk in the banking system, and to provide regulatory tools to lessen the problem.
A year after the bill became law, it still has many critics and champions.

Two coordinated terror attacks in Norway have left at least 92 dead. Flags are flying at half-staff and the Army is patrolling the streets in a city that just endured its worst peacetime attack in history. Our thoughts are with them.

Everything you wanted to know about the debt ceiling and its impact

2011-07-18T09:07:00.000-07:00

Everything you wanted to know about the debt ceiling and its impact

Balance the budget; curtail spending; reduce debt – three aspects of simple fiscal management. At one time or another, nearly every American has done these things to keep their financial house in order. Now it’s the government’s turn. Trouble is, the powers that be haven’t agreed on how to do it. Meanwhile, all the posturing in Washington is fueling investor frustrations as experts warn that failing to raise the debt ceiling will have disastrous consequences. Why is this such a complicated issue? And perhaps more importantly, why does immediate action need to be taken?

At a fundamental level, the problem is that the U.S. government spends more money than it takes in (See Chart). In order to cover the bills, it borrows money, thus the national debt. In theory, the debt ceiling is supposed to help Congress control spending, in reality, it isn’t working. Since 1962, the ceiling has been raised 74 times, ten of which have occurred since 2001.

What is the debt ceiling anyway?

It is a limit set by Congress on the amount of debt the federal government can borrow. The limit applies to debt owed to the public (e.g. U.S. bond holders) and debt owed to federal government trust funds such as those for Social Security and Medicare.
How high is the debt ceiling right now? The ceiling is currently set at $14.294 trillion. The country's accrued debt reached that mark on May 16, 2011. Currently, Treasury Secretary Timothy Geithner is taking various measures to allow the government to continue borrowing until August 2nd.

What now?

Nobody knows for sure how things are going to play out and the uncertainty is frustrating to say the least. Here are a few of the options that are currently being debated:
1) Do nothing.
This is not an option we want to see elected. If no action is taken, the Treasury will not have authority to borrow any more money. And since the government borrows to make up the difference between what it spends and what it collects, funds would not be available to pay the country’s bills.

Failure to act would create serious economic repercussions. At a minimum, a default would hurt U.S. bonds, the dollar, and investors' portfolios. And while a total government shutdown is unlikely, many who depend on government checks – from active-duty soldiers, veterans, and federal workers to name a few – could find their mailboxes empty. Which payments would be delayed is not known, but any choice would cripple parts of the economy and anger many groups of Americans.

Agree on a plan to reduce the budget deficit and national debt.
A package of $4 trillion in spending cuts and revenue increases is widely considered by fiscal experts to be the only way to start reining in the runaway U.S. debt. In this respect, the key issue is not just that a deal be made, but that it qualifies as a long-term solution.

Two key ratings agencies have said they expect policymakers to agree on a plan to meaningfully reduce the debt. Moody's Investors Services said Wednesday it would likely change its outlook on U.S. debt from “stable” to "negative" unless "substantial and credible agreement is achieved on a budget that includes long-term deficit reduction." Standard & Poor's went farther on Thursday by announcing there is a fifty percent chance it would downgrade the U.S. within 90 days if a credible agreement is not reached.

And while most Americans understand that changes need to be made, the politicians can’t agree on what those changes should be. To quote the president, “The American people are sold” on the idea of balancing spending cuts with tax increases. The problem is members of Congress are dug in ideologically.”

Even if the government agreed to cut all discretionary spending it wouldn’t make up for half of the deficit. Even eliminating social security and all defense spending would barely cover the deficit. And of course, that can’t be done. So as you see, policy makers have a serious challenge on their hands.

2) Raise the debt ceiling again.
Most experts agree that policymakers will raise the debt ceiling. If for no other reason, because the consequences of not doing so are too great. If the debt ceiling is breached, interest that the government pays on its debt will rise, pushing the deficit even higher.

Federal Reserve Chairman Ben Bernanke was on Capitol Hill Thursday, warning that failure by Congress to raise the debt ceiling would create "a calamitous outcome." Global confidence in U.S. Treasuries and the nation's AAA credit rating are among our nation's greatest economic assets, and according to Bernanke, "Losing that credit rating would be a self-inflicted wound". It would also be bad news for the labor market, the Fed chairman explained, which is an area of growing concern since the June jobs report showed hiring slowed to a crawl. In short, failing to raise the debt ceiling would be bad news all around.

It is our hope that a combination of efforts involving raising the debt ceiling and implementing a plan to begin reducing the deficit will be agreed upon promptly.

What are we doing in the meantime?

We have determined that it is too risky to try and predict what the outcome of this situation will be, and if we get a prediction wrong, it could cost our clients money.

Overall, we have confidence that some sort of agreement will be reached and we do not think now is the time to take drastic action. We realize it may not be especially reassuring for you to hear this, but we believe it is the best choice.
Rather than reacting too conservatively or aggressively, we continue to maintain that a balanced approach to investing, including diversification and maintaining long-term vision, is the best way to weather storms like this. We will, however, keep a close eye on the situation and monitor how any developments have the potential to affect your portfolio.
If you have any questions or concerns, please don’t hesitate to reach out to us. It is a pleasure serving you.

Jobs needed, for US Markets

2011-07-11T08:39:00.000-07:00

Jobs needed, for US Markets

Three things were on the minds of investors last week – jobs, jobs, and jobs.
U.S. Stocks posted broad losses on Friday as investors digested a disappointing June jobs report that showed hiring virtually stalled last month. The Labor Department's report showed the U.S. economy created only 18,000 jobs, a fraction of the 120,000 that economists predicted. At the same time, the unemployment rate rose to 9.2% from 9.1%, rather than declining as hoped.

Interestingly, the government's employment report came as a sharp contrast to two better-than-expected reports released Thursday on the job market, which helped U.S. stocks rise sharply. Payroll processing company ADP said private jobs grew rapidly in June – a figure that was much higher than anticipated and more than four times higher than May’s numbers. (ADP measures only private jobs, while the Bureau of Labor Statistics measures both private and public sector jobs.)

So on Thursday, positive jobs reports were good for stocks, while on Friday, negative jobs reports were bad for stocks. Why is everyone so focused on the nation’s employment picture? Put simply, the U.S. is a consumption economy. When Americans spend money on things like cars, clothes, and eating out, our economy grows. When people don’t have gainful employment, they spend less, companies earn less, and slower economic growth ensues. For these reasons and more, the jobs picture commonly affects stock market performance.

In the weeks ahead, investors will shift their focus to the health of Corporate America as companies start reporting earnings for the second quarter. Many expect that strong earnings and outlooks will help compensate for weak jobs data, and will reinforce that the recovery is still progressing.

ECONOMIC CALENDAR: Tuesday – International Trade, FOMC Minutes Wednesday –Import and Export Prices, Ben Bernanke Speaks, EIA Petroleum Status Report, Treasury Budget
Thursday – Producer Price Index, Retail Sales, Jobless Claims, Business Inventories
Friday – Consumer Price Index, Empire State Mfg Survey, Industrial Production, Consumer Sentiment

HEADLINES:

Betty Ford, the former first lady whose triumph over drug and alcohol addiction became a beacon of hope for addicts and the inspiration for her Betty Ford Center in California, died at age 93 on Friday. Her death was confirmed to The Associated Press by Marty Allen, chairman emeritus of the Ford Foundation. The former first lady died at the Eisenhower Medical Center in Rancho Mirage. Other details of her death were not immediately available.

The last shuttle thundered into orbit Friday on a cargo run that will close out three decades of both triumph and tragedy for NASA and usher in a period of uncertainty for America's space program.

South Sudan became the world's newest country Saturday with a raucous street celebration at midnight. South Sudanese citizens, international dignitaries and the world's newest president are convening in the new country capital of Juba to celebrate the birth of a nation.

European Union President Herman Van Rompuy has called a meeting of top EU policy makers Monday to discuss plans for a second bailout package for Greece, EU officials said on Sunday. The gathering comes as Europe continues to struggle with a contentious issue: whether and how Greece's private-sector creditors should share the burden when the anticipated second aid package is doled out to the debt-burdened country.

Fed Chair Bernanke makes a significant ‘revision’ for 2011, and 2012

2011-06-27T07:20:00.000-07:00

Fed Chair Bernanke makes a significant ‘revision’ for 2011, and 2012

With the Dow logging its seventh drop in eight weeks and the S&P off 7% from its three-year high at the end of April , many people are wondering if the markets have hit a speed bump or a roadblock. Combine weak stock performance with lukewarm economic readings and it’s easy to understand Fed chairmen Ben Bernanke’s comments last week: “We don’t have a precise read on why this slower pace of growth is persisting…some of these headwinds may be stronger and more persistent than we thought.”

The expressions: “We don’t have a precise read” and “than we thought” are interesting. They clearly demonstrate that even the “experts” do not have all the answers, and that they must change their viewpoint from time to time. Along these lines, the Fed issued new economic projections that call for slower growth, higher unemployment and higher inflation in 2011 and 2012 than in its previous forecast. At a press conference Wednesday afternoon, Bernanke referred to the new forecast as a significant revision. At the same time, the Fed still downplayed the chance of another recession, saying that it "expects the pace of recovery to pick up over coming quarters and the unemployment rate to resume its gradual decline."

Why do we point this out? This illustrates why we do not try to predict the future of the stock market or the economy. Doing so consistently and accurately is simply not possible. Whether we are facing a temporary slowdown or one that will last much longer is still open to interpretation and there are vocal proponents on both sides of the issue.

Since there is no way for us to predict the future, our goal is to help you commit to a sound investment plan based on your personal risk tolerance, goals and time horizon. Doing this requires that we take a long-term approach, not a short-term one. If we lose sight of the long-term and think we can time the market by exiting at the peak and re-entering at the trough, we open ourselves up for big mistakes. To quote legendary investor Warren Buffet: "Someone is sitting in the shade today because someone planted a tree a long time ago."

ECONOMIC CALENDAR: Monday – Personal Income and Outlays Tuesday – S&P Case-Shiller-HPI, Consumer Confidence Wednesday – Pending Homes Sales Index, EIA Petroleum Status Report
Thursday – Jobless Claims, Chicago PMI Friday – Motor Vehicle Sales, Consumer Sentiment, ISM Mfg Index, Construction Spending

Data as of 06/24/2011 1-Week YTD 1-Year 5-Year 10-Year
Standard & Poor's 500 -0.24 0.86 18.1 0.38 0.35
Dow -0.58 3.08 17.6 1.72 1.25
NASDAQ 1.39 0.00 19.6 5.01 3.04
MSCI EAFE -0.76 -0.02 20.1 1.04 2.59
10-year Treasury Note (Yield Only) 2.94 NA 3.12 5.23 5.12

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. NA means not available.

HEADLINES:

Irving Picard, the trustee liquidating Bernard Madoff’s firm, revised a claim against JPMorgan Chase & Co. requesting a minimum payment of $19 billion in damages for its role in the fraud. The new amount represents Picard’s latest estimate of principal lost by all Madoff investors by the time the Ponzi scheme collapsed in December 2008.

On Thursday, President Obama decided to release 30 million barrels of oil from the nation's strategic reserve, which will put 60 million barrels of fuel on the market over the next 30 days. Done in conjunction with other developed nations including Saudi Arabia, the move is not only an attempt to salvage Libya’s lost supply and meet rising demand in Asia and the Middle East, but is also seen as an attempt to lower fuel prices.

New-home sales fell 2.1% in May, the Commerce Department reported Thursday. The numbers showed a seasonally adjusted annual rate of 319,000 homes, far below the 700,000 homes per year that economists say must be sold to sustain a healthy housing market.

An EU-IMF team has approved Greece’s new five-year austerity plan after committing to an additional round of tax rises and spending cuts.

Can the economy improve for the second half of 2011?

2011-06-20T08:16:00.000-07:00

Can the economy improve for the second half of 2011?

Though our economic growth is being challenged by some strong headwinds, including high food prices, high gas prices, and a soft housing market, good news came at the right time last week. The Conference Board reported on Friday that its index of leading economic indicators grew by 0.8% in May. This represents the largest increase since February and is a strong improvement over the initial forecast. Some of the things that helped lift the index were:

• Federal Reserve policies designed to help financial markets.
• An increase in building permits, which signal future construction.
• A boost in consumer confidence as gas prices fell.
• Fewer people applying for unemployment benefits.

This report reaffirms what many economists have already been saying – while we are clearly facing some obstacles, the overall picture is improving. According to Moody’s analytics, economists are anticipating second-quarter growth between 2% and 2.5%. "Consumers are not panicking. We should begin to emerge from the soft patch in the second half of the year; a lot of the drags on the recovery are fading," said Ryan Sweet, a senior economist there.

In related news, the Dow rose for the first time since April and the S&P 500 broke a six-week losing streak by climbing 0.3%. In addition, suppliers are finally able to predict full rebounds from the March Japanese earthquake, with Honda projecting a return to normal production in August and Toyota following suit in September. While the economic recovery will likely continue to ebb and flow, these are some of the signs that we are still headed in the right direction.

ECONOMIC CALENDAR: Tuesday – Existing Home Sales Wednesday – EIA Petroleum Status Report, FOMC Meeting
Thursday – Jobless Claims, New Home Sales Friday – Durable Goods Orders, GDP

HEADLINES:

The Senate voted Thursday to cut the $5 billion-a-year subsidy given to oil refiners for blending ethanol into gasoline. Provided in the form of tax credits, the subsidy gives 45 cents a gallon to refiners who use ethanol, a renewable fuel additive that comes mainly from corn in the U.S..

Ownership of the Los Angeles Dodgers baseball team will be determined by a one-day divorce trial. The outcome will decide whether Frank McCourt is the sole owner, or if the team should be considered community property, which could likely lead to a sale of the team.

Microsoft won antitrust approval to complete the purchase of Skype, an internet phone service. Its largest acquisition to date, the company will buy Skype for $8.5 billion.

In the United States, 176 million people watched online videos last month, much of it on YouTube, according to the latest survey by comScore. Each person watched 15.9 hours on average.

Has the economy hit a "soft patch"? Or something worse?

2011-06-13T08:51:00.000-07:00

Has the economy hit a "soft patch"? Or something worse?

With hiring at a crawl, home prices at a low, consumer and business spending slowing, and the stock market logging its sixth straight week of losses, headlines continue to declare doom and gloom. As is frequently the case, all this negative press has caused investor sentiment to swing wildly. The latest American Association of Individual Investors (AAII) survey shows that bearish sentiment jumped 14.2% last week alone. Despite the bearish sentiment though, there are positive markers that bode well for a slow-growth recovery.

While leading economists have trimmed their forecast for 2011 GDP growth to 2.7% from 3% a month ago, they are still predicting stronger growth for the second half of the year. 2.7% isn’t that far off the 2.9% growth we saw in 2010. Additionally, manufacturing continues to expand and the ISM Non-Manufacturing Index for May reported that economic activity grew in May for the 18th consecutive month, providing a pleasant surprise last Friday. And while U.S. supply was significantly reduced in the auto and technology sector as a result of the earthquake in Japan, the problems are being steadily resolved.

Lower commodity prices are also a positive side effect of slowed growth. All things being equal, as commodity prices fall, growth prospects improve. In fact, Goldman Sachs Group recently turned bullish on commodities, making the case that dropping prices will stimulate growth and send commodity prices rising again. This aptly illustrates the cyclical nature of our economy.

Strong corporate earnings have allowed for cheaper stocks. Interest rates remain extremely low and aren't expected to start rising until at least a year from now. U.S. exports climbed to an all-time high on Thursday, increasing to $175.6 billion in April, and now comprise 13% of the GDP. As you can see, there is still a lot of positive information out there.

Market sentiment and media reports often go hand-in-hand. When circumstances seem glum, the good news tends to get buried behind fearful forecasts. And while it can be tempting to go with the flow and join the ranks of anxious investors, we urge you to examine every part of the economic picture before drawing conclusions.

ECONOMIC CALENDAR: Tuesday – Producer Price Index, Retail Sales, Business Inventories Wednesday – Consumer Price Index, Empire State Mfg Survey, Industrial Production, Housing Market Index, EIA Petroleum Status Report
Thursday – Housing Starts, Jobless Claims, Philadelphia Fed Survey Friday – Consumer Sentiment

Data as of 06/10/2011 1-Week YTD 1-Year 5-Year 10-Year
Standard & Poor's 500 -2.24 1.06 16.9 0.30 0.05
Dow -1.64 3.23 17.5 1.95 0.89
NASDAQ -3.26 -0.34 19.2 4.76 1.94
MSCI EAFE -2.95 1.56 24.6 1.48 2.36
10-year Treasury Note (Yield Only) 3.00 NA 3.32 4.98 5.33

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. NA means not available.

HEADLINES:

Oil prices fell 2.5% Friday on reports that Saudi Arabia plans to increase production 13% to 10 million barrels per day. The increased production is expected to slow this year’s 26% rise in oil prices and the 2% increase in gasoline.
The Fed will buy $50 billion of Treasury’s in the final series of government bond purchases that marks the last phase of QE2. Launched in November 2010, the purchases will end June 30, though the stimulus will continue with the Fed reinvesting maturing securities.

The White House confirmed that it is considering cutting the payroll taxes that businesses pay. In December employees began paying 4.2% of their wages, two percentage points less than usual, while employers continue to pay the standard 6.2%. The potential policy change hopes to improve employment numbers by promoting hiring.

Paying a total of $2,626,411, an anonymous donor has won lunch with Warren Buffett. Already winning the eBay auction, the bidder topped their previous offer by $100. Proceeds from the auction benefit Glide, an organization that benefits poverty-stricken residents of the San Francisco Bay area.

Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.
These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative or named Broker dealer, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

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http://money.cnn.com/2011/06/10/news/economy/recession_economic_survey/index.htm?iid=EL
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http://money.cnn.com/2011/06/10/news/economy/recession_economic_survey/index.htm?iid=HP_LN
http://www.ism.ws/ISMReport/nonmfgROB.cfm
http://www.smartmoney.com/invest/stocks/why-the-market-worrywarts-are-wrong-1307117379674/
http://www.smartmoney.com/invest/stocks/why-the-market-worrywarts-are-wrong-1307117379674/
http://www.smartmoney.com/invest/stocks/why-the-market-worrywarts-are-wrong-1307117379674/
http://www.nytimes.com/2011/06/10/business/10markets.html
http://online.wsj.com/article/BT-CO-20110609-708605.html
http://www.businessweek.com/ap/financialnews/D9NP4RCG1.htm
http://www.cnbc.com/id/43356436
http://blogs.marketwatch.com/election/2011/06/10/employer-payroll-tax-proposal-panned/
http://money.cnn.com/2011/06/10/news/companies/buffett_lunch/index.htm?iid=HP_LN

How much longer will the market's correction continue?

2011-06-06T08:00:00.000-07:00

How much longer will the market's correction continue?

U.S. Stocks fell for the fifth straight week after disappointing reports on jobs and manufacturing fueled concerns that economic growth is slowing. The S&P 500 slid 2.3% to 1,300, its lowest level since March, while the Dow fell 290.32 points, or 2.3%, to 12,151. Should this be cause for alarm? This week, we would like to share what some industry insiders have recently said about the matter.

"Our view is that we're clearly seeing a slowdown, but you'd need a shock to the system to see things get much worse from here. There's little room for error, but there are reasons to expect growth, and we don't see a whole heck of a lot more downside."

- Andrew Goldberg, market strategist at J.P. Morgan Funds in New York
"We don't see material downside from here. A five percent correction is appropriate for the slowdown we're experiencing, and over the intermediate term, our expectation is that we'll regain some momentum.”

- Jim McDonald, chief investment strategist at Northern Trust Global Investments
“Investors should be looking for buying opportunities. The economy is not as bad as it looks right now.

- Byron Wien, vice chairman of Blackstone Advisory Partners
From experience we know that the “experts” aren’t always right. In this case, we agree things are not as bad as some of the headlines make them out to be. The recovery is progressing slower than we would like, but it is still progressing. Until employers start persistently hiring again, the housing market gets straightened out, and Washington figures out what to do about the deficit, the recovery is going to ebb and flow.

The events that ultimately led up to the so-called Great Recession took years, even decades to unfold. In a similar way, the economy will take years to recover, not weeks or months. It is good to keep this fact in mind when we pick up the newspaper, turn on the television, or visit our favorite news website.

ECONOMIC CALENDAR:
Monday: Ben Bernanke Speaks
Tuesday: Consumer Credit
Wednesday: EIA Petroleum Status Report, Beige Book
Thursday: International Trade, Jobless Claims
Friday: Import and Export Prices, Treasury Budget

HEADLINES:
Greece has agreed to speed its sale of state-owned property and cut billions of dollars more from its budget to satisfy requirements for promised loans from the International Monetary Fund and other European countries.

The president of Toyota Motors said on Saturday he expects the automaker to resume full production globally in November and its Japanese output is expected this month to recover to 90% of levels seen before the March earthquake.

Two bottles of the world’s oldest Champagne, which spent about 170 years at the bottom of the ocean, sold for 54,000 euros ($78,400) at an auction in Finland today.
The computer phishing attack that Google says originated in China was directed, somewhat indiscriminately, at an unknown number of White House staff officials, setting off the Federal Bureau of Investigation inquiry that began this week, according to several administration officials.

Is the glass half full or half empty for US Markets?

2011-05-31T11:26:00.000-07:00

Is the glass half full or half empty for US Markets?

Have you ever been through a period of recovery in your life? Perhaps you received an injury of some sort and needed time to heal. While recovering, we don’t usually function at our peak level do we? We might experience a measure of discomfort or decreased mobility for a time. We may have good days and bad days. This aptly illustrates what our economy is going through.

From late 2007 to mid 2009, we sustained a serious injury. Since that time official data shows that we are recovering, but it doesn’t always feel like we are. Disruptions from the Japanese earthquake and tsunami have had a direct impact on manufacturing and the auto industry in particular. The spike in oil and gasoline prices has affected consumer and business spending. More recently, European sovereign debt woes and a batch of soft economic reports have created tension for stock markets. What does this all mean? It means we are not functioning at our peak level because we’re going through a period of healing. Until we are fully recovered, we are going to experience ups and downs.

We’ve come very far, very fast – especially in the stock market. With the Dow up some 22% in the last 12 months , we must reasonably acknowledge that such rapid growth is not sustainable. We may have to go lower before we go higher. Since the markets began to rise in March 2009, we have seen a number of 5-7 % pullbacks and we may see more of them in the future.

To use another analogy, if you’re on a bumpy plane ride, you don’t strap on a parachute and jump out the door at the first sign of turbulence; you simply buckle your seatbelt and try to relax. That is precisely what we are encouraging you to do. Now is not the time to give up on our expectations for a full recovery.

ECONOMIC CALENDAR:
Monday: US Holiday – Memorial Day
Tuesday: Chicago PMI, Consumer Confidence, S&P Case-Shiller Home Price Index
Wednesday: Motor Vehicle Sales, ADP Employment Report, ISM Manufacturing Index, Construction Spending
Thursday: Monster Employment Index, Jobless Claims, Productivity and Costs, Factory Orders
Friday: Employment Situation, ISM Non-Manufacturing Index

HEADLINES:
Gas prices have come down in May after reaching nearly $4 last month, giving a lift to how people feel about the economy and raising hopes that they might be willing to spend more. Benchmark oil for July delivery was down 70 cents to $99.89 a barrel in electronic trading on the New York Mercantile Exchange on Friday.

The European Union is working on a second bailout package for Greece in a race to release vital loans next month and avert the risk of the euro zone country defaulting, EU officials said on Monday.

China will raise retail electricity prices starting next month, the first increase in more than a year, to curb demand and boost power generation as the nation battles with a supply shortfall that may be the worst in history.

A woman's attempt to sell a purported $1.7 million moon rock was thwarted last week when the buyer she met with turned out to be an undercover agent working for NASA. The sting, which according to the Riverside County (Calif.) Sheriff's Dept. came after several months of investigation, took place at a Denny's restaurant in Lake Elsinore, Calif., about 70 miles southeast of Los Angeles. The woman, who authorities did not identify, was detained but not arrested pending the "moon rock" being verified as

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How will European Debt crisis impact our US Markets?

2011-05-23T08:02:00.000-07:00

How will European Debt crisis impact our US Markets?

The sovereign debt situation in Europe and particularly in the PIIGS (Portugal, Italy, Ireland, Greece, and Spain) has been a feature in the news since early last year. In recent days though, additional attention has been drawn to this issue as international ratings agency, Fitch, lowered Greece’s credit rating further into junk status Friday. They also warned that any attempt to extend the maturities of Greek sovereign debt would be treated as a default.

Likewise illuminating the significance of this problem, eighty-five percent of international investors surveyed by Bloomberg last week said Greece will probably default on its debt, with majorities predicting the same fate for Ireland and Portugal. The European Commission said on May 13 that Greece’s debt will reach 166 percent of gross domestic product next year, the highest for any country in the euro’s history.

Perhaps you are wondering why debt problems on the other side of the world matter here in the U.S. Admittedly, Greece’s annual output is only about one-half of one percent of the world’s output and less than three percent of Europe’s GDP . But if the problems extend into other Eurozone countries, triggering additional defaults, a slowdown in European growth could occur, creating further drag on the world economy.

To bring matters closer to home, with U.S. debt projected to grow more than 275 percent by 2035 , the U.S. has financial problems too. American political leaders disagree on how to solve these problems just as Greece’s leaders do. This is another reason why many people are watching Europe so closely – they recognize that important lessons can be learned by evaluating how debt problems abroad are resolved.
No one can say with certainty how the sovereign debt crisis will be resolved.

Regardless of what happens though, rest assured that we will continue to monitor the situation both domestically and abroad, and will keep you informed about anything with the potential to affect your finances.

ECONOMIC CALENDAR:
Tuesday: New Home Sales
Wednesday: Durable Goods Orders, EIA Petroleum Status Report
Thursday: GDP, Jobless Claims, Corporate Profits
Friday: Personal Income and Outlays, Consumer Sentiment, Pending Home Sales Index

HEADLINES:

The average U.S. price of a gallon of gasoline has dropped about 9 cents over the past two weeks bringing the national average for a gallon of mid-grade to $4.05. For premium it's $4.16 a gallon.

With the effects of the earthquake in Japan rippling through the auto industry and causing shortages, prices are rising for both new and used cars. It is also anticipated that fewer models and options will be available come summer, especially for the hybrids and fuel-efficient vehicles that Japan produces.

Oil slid to its lowest price in almost three months last week as
a stronger dollar, increasing crude-oil stockpiles, and decreasing demand all took a toll on prices. Crude oil for June delivery dropped 46 cents to $96.91 a barrel on the New York Mercantile Exchange, the lowest settlement since Feb. 22.

The number of American households behind on mortgage payments hovered at its lowest level in nearly two years during the first quarter, but the number of borrowers in foreclosure stayed near record high levels, the Mortgage Bankers Association said on Thursday.

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What is the ‘true’ financial health of Medicare and Social Security???

2011-05-16T08:06:00.000-07:00

What is the ‘true’ financial health of Medicare and Social Security???

Each year the Trustees of the Social Security and Medicare trust funds report on the current and projected financial status of the two programs. This year’s report was released on Friday, and we thought you might like to know about the key findings.
According to government predictions, Medicare’s largest trust fund will run out of money in 2024, five years earlier than projected last year. The program’s faulty finances are, in part, a symptom of the sluggish economy. Higher projected health-care costs and lower payroll taxes are being blamed for the shortfall. Pressure will doubtless intensify in Washington as a bipartisan effort is made to shore up the 46-year-old healthcare plan that covers more than 47 million elderly and disabled Americans.

Regarding Social Security, the report showed that expenditures exceeded the program’s non-interest income in 2010 for the first time since 1983, and that the program faces a $46 billion deficit for 2011. The projected point at which the combined Trust Funds will be exhausted comes in 2036 – one year sooner than projected last year. At that time, there will be sufficient income to pay only 77% of scheduled benefits.

The report concluded by saying that, “projected long-run program costs for both Medicare and Social Security are not sustainable under currently scheduled financing, and will require legislative corrections if disruptive consequences for beneficiaries and taxpayers are to be avoided. The financial challenges facing Social Security and Medicare should be addressed soon. If action is taken sooner rather than later, more options and more time will be available to phase in changes so that those affected can adequately prepare.”

While it is impossible for us to address all the nuances of Medicare and Social Security in this brief communication, let alone all the proposed solutions, we wish to draw your attention to the two italicized words at the end of the previous paragraph: adequately prepare. Of all the information we found in the eye-crossing 244 page report (you can read it here: http://www.socialsecurity.gov/OACT/TR/2011/tr2011.pdf), these two words strike us as most significant.

No one can predict with certainty what the future of Medicare and Social Security will be. Most people agree that reforms are needed and that changes will be made, but what those changes will be and how they will affect beneficiaries, remains to be seen. What we do know, is that we must adequately prepare in every way possible.
Adequate preparation requires a number of things. It involves taking your life expectancy into consideration when deciding what withdrawal rates are sustainable in your portfolio. It includes choosing an asset allocation that is likely to keep pace with inflating healthcare costs. It means considering whether long-term-care or other insurance coverage is right for you. It dictates determining the best time to start collecting benefits. Many important decisions must be made when preparing for the future and it is unwise to rely too heavily on government programs for support. Although making the right decisions can be challenging, we are here to guide you through the process.

If you have questions about how anything in this report could affect you or your loved ones, please don’t hesitate to reach out to us. We are here to serve you.

HEADLINES:
The average 401(k) balance rose to $744,900 at the end of March, Fidelity said, the highest since the firm began tracking the data in 1998 and a 12% jump from a year ago. Nearly 10% of participants raised their contribution rate during the first quarter, also a record.

Consumers continued to feel the pinch at grocery stores and gasoline stations in April as higher prices pushed up a widely used index of inflation to the fastest 12-month pace since the later part of 2008, according to government figures released Friday. The Labor Department said the consumer price index, the most widely used measure of inflation, was up 0.4 percent in April from March, and up 3.2 % from a year earlier.

US oil drilling activity slipped this week, down by 6 rotary rigs compared with a year ago, Baker Hughes Inc., an oilfield services company, reported. Land operations had the biggest loss, down 7 units, and inland waters activity decreased by 2 rigs. In what has become an unusual situation, offshore drilling registered the only increases, up by 3 rigs to a total of 33 rigs drilling in US waters.
The euro fell against all but two of its 16 most-traded counterparts, reaching a six-week low against the dollar, on concern Greece may have to restructure its debt and the nation’s problems may spread in the region.

Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.
These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative or named Broker dealer, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

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When will lower oil prices translate to lower gas prices at the pump?

2011-05-09T07:37:00.000-07:00

When will lower oil prices translate to lower gas prices at the pump?

More jobs and more oil – two things we have to be thankful for. When Americans are gainfully employed, they spend more and the economy grows. When there’s extra oil supply, its value drops and gas prices usually follow.

The employment picture has been improving since the beginning of the year, with a total of 768,000 jobs added since January. This momentum was carried through the month of April with the economy adding 244,000 jobs, the Labor Department reported Friday. April was the strongest month for business hiring since February 2006, and the job gains were distributed across multiple business sectors. In fact, 73% of the nation’s industries have added jobs in the last six months alone. That's the most broad-based job gain on record since 1998.

Last week finally gave us a break from the recent run-up in oil prices as crude tumbled 15% to its biggest weekly decline in more than two years. In just one week, light, sweet crude fell from a close of $113.93 to a close of $97.18 a barrel on the New York Mercantile Exchange. After nearing $114 a barrel as fears about supplies took hold following escalating violence in Libya, a close below $100 is more than welcome.

The 15% drop in oil prices revives hope that lower gas prices will follow. And while oil usually needs to hover in this price range for a couple weeks before gas prices will fall, some analysts are predicting that prices will drop to an average of $3.75 per gallon by Memorial Day, and $3.50 by mid-summer. Some areas of the country have already seen a decrease in prices. Nigel Gault, chief economist for IHS Global Insight was quoted by USA Today as saying that "If this sticks, it's worth about 20 cents off the price at the pump."

These are two areas of the economy that we have been watching closely, and it is nice to see these positive trends. If things continue moving in this direction, it will probably have a positive impact on the American financial system.
e.

HEADLINES:

News of Bin Laden’s death led U.S. stocks to trade higher on Monday morning, but the so-called “Bin Laden Rally” quickly fizzled after investors concluded his death does little to ease global economic and political risks.

G.M. Reported that their earnings tripled in the first quarter, as revenue jumped 15%. The company’s profit was more than triple what it achieved in the same period a year ago, and its fifth consecutive profitable quarter.

U.S. born radical Anwar al-Awlaki is expected to become Al Qaeda leader Bin Laden's successor. It's understood that he survived a U.S. drone attack on a car in Yemen on Thursday. U.S. born radical al-Awlaki is widely believed to be the mastermind behind a number of terror atrocities and the leader of Al Qaeda in the Arabian Peninsula.
Fannie Mae reported a net loss of $6.5 billion for the first quarter as a weakening housing market dashed hopes that the company had stabilized. Fannie said Friday it would ask the government for a fresh taxpayer infusion of $6.2 billion after paying dividends to the Treasury. The loss follows net income of $73 million during the previous quarter.

Eurozone members are debating milder recovery terms for debt-hit Greece as it struggles to stick to a harsh austerity plan, Greek media said Saturday after emergency talks in Luxembourg. The reports said Finance Minister George Papaconstantinou had flown to a "secret" meeting among G20 eurozone states that debated giving Athens more time to repay a 110-billion-euro ($157 billion) EU-IMF loan and easier deficit reduction targets.

Crosscurrents of the economy and a market at a 3 year high.

2011-05-02T08:06:00.000-07:00

Crosscurrents of the economy and markets at a 3 year high.

Stocks finished sharply higher last week, leading major indexes to their best month so far this year. A strong earnings season coupled with increases in personal spending, personal income, and gradual improvement in the nation’s job picture helped the Dow finish 4.3% higher for the month.

Also last week, Fed Chairman Ben Bernanke held his first-ever press conference to answer reporters’ questions in a televised setting. A clear effort was made to reassure a skeptical public that the central bank is doing everything it can to control inflation and expand the recovery. "It is very hard to blame the American public for being impatient," the Fed Chairman told about 60 reporters at Wednesday's news conference. Citing high unemployment and rising gas prices, Bernanke acknowledged that, "Conditions are far from where we would like them to be.”

Commenting on the Fed’s commitment to help curb excessive inflation, the Fed Chairman added, “If inflation persists or inflation expectations begin to move, then there is no substitution for action. We would have to respond... I think every central banker understands that keeping inflation low and stable is absolutely essential to a successful economy. And we will do what is necessary to ensure that that happens.” At a time when food and gas prices are on the rise, these words were comforting for many Americans to hear. And while stating that the recovery has been merely “moderate”, Bernanke also stressed the Fed’s belief that it is “sustainable”.

In spite of Mr. Bernanke’s constructive tone, we must reasonably acknowledge that the economic picture is not entirely rosy. Government data released Thursday showed that U.S. GDP slowed in the first quarter to 1.8% from 3.1% in the previous quarter, reflecting a spike in gasoline, higher overall inflation, and continued weakness in the housing market.

Much like a ship captain monitors his navigational instruments, we will continue to monitor both the policy makers and the economic indicators that help us navigate the vast sea of investment options. Commentaries like this are our way keeping you informed of the course we are charting.

ECONOMIC CALENDAR:
Tuesday – Redbook, New Home Sales
Wednesday – Durable Goods Orders
Thursday – GDP, Jobless Claims , Corporate Profits
Friday – Personal Income and Outlays, Consumer Sentiment

HEADLINES:
The death toll from this week's storms rose to 343 Saturday, according to an NBC News count, making the tornado outbreak the second deadliest in U.S. history. Catastrophe risk modeling company EQECAT said that with initial reports of nearly 10,000 destroyed buildings, property insurance losses were expected to range from $2 to $5 Billion.

President Barack Obama used his weekly address to the nation to reiterate his call on Congress to stop granting tax subsidies to oil and gas companies. Despite recent signs of economic recovery, families across the country are experiencing “real pain” from soaring gas prices, Obama said.

Prince William and Kate Middleton have been pronounced husband and wife at Westminster Abbey in London. The Duke and Duchess of Cambridge, as they will now be known, made their vows in front of 1,900 guests and the eyes of the world.
The U.S. Federal Trade Commission is preparing an investigation of Google Inc.’s dominance of the Internet search industry by alerting high-tech companies to gather information for the probe, three people familiar with the matter said. The probe is examining whether Google discriminated against other services in search results and stopped websites from accepting rival ads.

Al Qaeda leader Osama bin Laden, a mastermind of the largest terrorist attack in American history, was killed Sunday in Pakistan in a military operation after the U.S. learned of his location.

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Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market

How will budget talks affect your tax rate?

2011-04-25T10:04:00.000-07:00

How will budget talks affect your tax rate?

Do you want to pay higher taxes? I know I don’t! But if you happen to be among the fortunate few that earn more than $250,000 a year, new polls suggest your neighbors want you to pay up.

According to the latest New York Times/CBS News poll, 72% of adults approve of increasing federal taxes on households making more than $250,000 starting in 2013. At the same time, a separate poll from ABC News and the Washington Post showed that 72% of respondents want to raise taxes on the rich to help reduce the federal deficit. The desire to see America’s wealthiest citizens paying higher taxes even spans political boundaries, with 55% of Republicans, 74% of independents and 83% of Democrats all calling for an increase.

So will increasing taxes on the rich fix the budget? This is not a question we will even try to answer in this brief commentary. It is worth noting however, that less than 3% of all American households earn more than $250,000 per year, and as it stands today, the U.S. tax system is already highly disproportionate. The top 1% of income earners pay 40% of all federal income taxes, the bottom 50% pay only 3%, and more than one-third of U.S. earners pay no federal income tax at all.

As new data from the Congressional Budget Office shows, raising all six income tax rates by 1 percentage point would yield an additional $480 billion over 10 years, while raising the top two rates by 1 percentage point would yield only $115 billion. So what is better: Increasing taxes a little bit for everyone or a lot for just a few? Perhaps another question to ask is whether America has a spending problem or a revenue problem? Again, these are not questions we can answer in this forum.

The point of sharing this information with you is not to fuel a political debate. The nation is already sharply divided on this issue. The reason we draw your attention to this matter is because directly or indirectly, it affects every American. And, at the rate things are going, there is a good chance we will see higher taxes in the future. Taking into consideration how taxes can affect your investments, both now and in the future, is an important element to preparing sound financial strategies. As always, we will monitor how the landscape changes and do our best to help you adapt to changing conditions.

ECONOMIC CALENDAR: Tuesday – S&P Case-Shiller Home Price Index, Consumer Confidence
Wednesday – Durable Goods Orders, FOMC Meeting Announcement
Thursday – GDC, Jobless Claims, Pending Home Sales Index Friday – Personal Income and Outlays, Chicago PMI, Consumer Sentiment, Ben Bernanke Speaks

HEADLINES:

U.S. stocks advanced for a third straight session Thursday, with the Dow closing at almost a 3-year high following a slew of strong earnings.

Sales of existing homes increased in March. Home sales rose at an annual rate of 5.1 million in March, up 3.7% from February, the National Association of Realtors said Wednesday. However, sales were 6.3% lower than in March 2010.

With a 4% gain so far this month, following March’s 10% rise, benchmark oil futures are keeping up with a long-running trend – advancing in March, April and May before taking a breather in June.

Toyota Motor Corp.'s global car production, disrupted by parts shortages from Japan's earthquake and tsunami, won't return to normal until November or December, imperiling its spot as the world's top-selling automaker.

US debt is over 14 Trillion, and counting..What’s next?

2011-04-18T08:19:00.000-07:00

US debt is over 14 Trillion, and counting..What’s next?

Standard & Poor's on Monday downgraded it’s outlook for the United States, citing a "material risk" that policymakers may not reach agreement on its large budget deficit. The US debt is over 14 Trillion (and counting) http://www.usdebtclock.org/

While S&P maintained the country's top AAA credit rating, it said that authorities have not made clear how they will tackle long-term fiscal pressures.
S&P said the move signals there's at least a one-in-three chance that it could cut its long-term rating on the United States within two years.

In spite of a rocky start to earnings season, promising economic news helped reassure investors this week. Stocks even managed to post modest gains on Friday in response to the hopeful signs.
Aside from food and gas prices, the Labor Department reported that consumer prices rose just 0.1% in March, lower than the predicted 0.2%. With prices inflating slower than expected, Americans got a break. And in today’s economy, consumers need every break they can get. When prices are lower, people tend to feel better and spend more – good news since consumer spending accounts for about 70% of the total U.S. economy.

Signs show that Americans are also feeling more optimistic. The U.S. consumer sentiment index rose from 67.5 in March to 69.6 in April, beating expectations. This increase could be partially attributed to the addition of jobs for six straight months and an unemployment rate sitting at a two-year low. These positive numbers indicate job gains are helping Americans manage rising fuel costs and maintain a positive outlook.

Industrial production increased for the ninth straight month in a row, rising 0.8% in March, and factory production increased 9.1% in the first quarter. Total industrial production was 5.9% above its year-earlier level. These numbers are all higher than forecast last month, and are a good sign that factories will keep driving the U.S. economy.
These indicators show that prices are down, optimism is up, and factories are producing at higher levels than last year; all signs that our economy is still making progress. Earnings season will kick into high gear this week as Wall Street gets quarterly results from 110 members of the S&P 500, giving us a broad view of how Corporate America is doing.

ECONOMIC CALENDAR: Monday – Housing Market Index Tuesday – Housing Starts, Redbook Wednesday – Existing Home Sales, EIA Petroleum Status Report
Thursday – Jobless Claims, Philadelphia Fed Survey, Leading Indicators Friday – U.S. Market Holiday: Good Friday Observed

HEADLINES:
Congress sent President Barack Obama legislation cutting a record $38 billion from federal spending on Thursday. This measure will finance the government through the September 30th end of the budget year.

Bank of America's first-quarter income fell 39% on higher costs related to its mortgage business and litigation. The bank also settled a claim over faulty mortgage investments and set aside less money to cover bad loans. The earnings fell short of the 28 cents a share estimated by analysts surveyed by FactSet and revenue fell to $26.9 billion from $32 billion in the same period last year.

The first settlement with the Securities and Exchange Commission (SEC) could be reached as soon as next week. The securities regulator is in talks with major Wall Street banks to settle fraud allegations relating to the sale of toxic mortgage bonds to various investors that helped unleash the financial crisis.

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Here,” Member FINRA/SIPC.

Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.
These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative or named Broker dealer, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

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Will high oil prices and stocks run a collision course?

2011-04-11T07:30:00.000-07:00

Will high oil prices and stocks run a collision course?

A barrel of oil is now over $112 a barrel, and gas in our area is over $4 a gallon. Master card reported that gas purchases were down 5 weeks in a row. The higher prices now are already affecting consumer behavior and is acting as an overall ‘headwind’ for our economy. It seems for most analysts that something has to give; it’s either that oil prices moderate, or perhaps the stock market.

Fears of a government shutdown loomed large last Friday night. With less than an hour to spare, Congress pushed through a last-minute spending bill – the seventh in the past six months – which cut $2 billion and allows agencies to spend money through April 15. By that time, lawmakers expect to determine a budget for the remaining six months of the fiscal year. It is interesting to note how awareness of the potential shutdown affected investors.

As a result of the budget impasse, a sharply weaker dollar led investors into oil and commodities, while U.S. stocks fell. As we’ve mentioned before, equity markets don’t like uncertainty, and the exodus we saw on Friday is a classic example of this fact. At a time when concerns regarding the Middle East situation has sent oil prices surging, and the Japanese disaster has impacted supply chains, reaching a deal was extremely important. The last-minute agreement keeps 800,000 government workers on the job and a variety of services, from passport issuing to tax collecting, up and running. It also allows the military to continue receiving their paychecks.

“Both sides had to make tough decisions and give ground on issues that were important to them,” President Obama said. “But beginning to live within our means is the only way to protect those investments that will help America compete for new jobs.” Despite budget concerns, consumer confidence rose for a second consecutive week as an improving job market helped ease the burden of higher fuel costs.
As in the past, both international and domestic politics will continue to play a part in peoples investing decisions. The week ahead will likely be no exception as the new budget is voted on. Also next week, a series of labor reports are released and earnings season begins. We’ll let you know how things turn out in our commentary next week.

ECONOMIC CALENDAR: Tuesday – International Trade, Import and Export Prices, Bank of Canada Announcement, Treasury Budget Wednesday – Retail Sales, Business Inventories, EIA Petroleum Status Report, Beige Book
Thursday – Producer Price Index, Jobless Claims Friday – Consumer Price Index, Empire State Mfg, Treasury International Capital, Industrial Production, Consumer Sentiment

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. NA means not available.

HEADLINES:
Crude oil advanced 2.3% Friday, settling at $112 a barrel – its highest price in more than 30 months. In addition to sparking fears about a slowdown in the global economy, investors are also concerned about Libya's civil war and the country’s 80% drop in production.

On April 6 Portugal asked for international assistance, joining Greece and Ireland in receiving bailouts from the European Union and the International Monetary Fund. The country faces around €4.3 billion ($6.2 billion) of bond redemptions in April, followed by a repayment of €4.9 billion in June.

The quarterly earnings season begins next week. Gas and commodity prices have surged this year, and could spell trouble for the rebound in consumer spending and sales growth. Overall, earnings for the companies in the S&P 500 are expected to be up 11.5% over last year. Revenues are expected to rise 8%, remaining unchanged from the fourth quarter.

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Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.
These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative or named Broker dealer, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

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What can investors expect after a strong first quarter?

2011-04-04T08:25:00.000-07:00

What can investors expect after a strong first quarter?

The first quarter of 2011 has been one for the history books. Political turmoil in Northern Africa and the Middle East, as well as multiple catastrophes in Japan rattled many investors, but wasn’t enough to halt the running of the bulls. Despite noteworthy volatility, the Dow rose 6.9% to its best first quarter in 12 years, rebounding 6% from lows hit in mid-March.

January – The year started hesitantly as Americans considered the impact of political transition, both through QE2 measures and the new Republican majority. At the end of the month, political strife in Egypt was affecting world markets. Protests started there on January 25th when thousands of people took to the streets to protest poverty, rampant unemployment, government corruption and the autocratic governance of President Hosni Mubarak.

The price of oil rose with fears about the stability of maritime operations on the Suez Canal. As a major trade route, any interruption or closure has the potential to create a spike in oil and energy prices. Still, on the 31st, the Dow posted its highest close since October 2, 2008.

February – By Valentine’s Day, U.S. stocks climbed to fresh 2 1/2-year closing highs after the resignation of Mubarak removed a layer of uncertainty from global markets. Mubarak’s resignation dramatically reduced geopolitical risk and uncertainty from the region, and crude oil prices dropped to $85.16 a barrel. But the calm would last only a short while before similar issues in Libya made headlines. Although Libya supplies just under 2% of the world's oil supply, oil fears still caused the stock market to suffer its first weekly loss in a month. And while U.S. drivers were already feeling the pinch at the pump, gas prices took their biggest one-day jump in two years adding to concerns about the stability of the economic recovery.

March – On March 11, 2011 an 8.9 earthquake rocked Japan and generated a 30-foot-high tsunami that devastated the country’s northeastern coast. On the heels of this devastating news were reports of several damaged nuclear reactors. Almost immediately, Japan’s recession-burdened stock markets dropped. Many of the nation’s industries, including automotive factories and electronics, were forced to halt operations. Simultaneously, the U.S. participated in establishing a no-fly zone over Libya – a situation that remains unstable. And in the Euro zone, debt woes flared up again as Portugal’s government collapsed and questions about Spain’s solvency persisted. Thankfully, the economic impact of Europe’s debt woes have remained relatively contained to date. Finishing the quarter, the markets struggled to regain their footing after two negative weeks, but by the end of March had managed to recoup losses on positive news regarding 2010’s fourth quarter, increased consumer spending, and higher GDP.

Despite upheaval in the Middle East, Eurozone changes, and an ongoing crisis in Japan, investors appear determined to maintain their confidence. Sending a signal that bodes well for the second quarter, the Dow rose 0.5% on Friday, reaching its highest intraday level since June 6, 2008. Although such positive news should be enjoyed, it is not to say more uncertainty and market volatility won’t arise. Many of the issues introduced in March still linger and remain developing stories. As always though, we are here to help you assess the risks and rewards of investing, to educate you, and to keep you informed. We hope you have a great week!

ECONOMIC CALENDAR: Tuesday – ISM Non-Mfg Index, FOMC Minutes Wednesday – EIA Petroleum Status Report
Thursday –BOE Announcement, ECB Announcement, Jobless Claims
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Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.
These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative or named Broker dealer, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

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Despite international uncertainty, US data improving by Ken Mahoney

2011-03-28T09:27:00.000-07:00

Despite international uncertainty, US data improving by Ken Mahoney

Despite a plague of turbulent international events, the bulls managed to triumph over uncertainty last week. U.S. stocks climbed for a third straight day Friday, erasing the past week’s losses from Japan’s nuclear crisis. In fact, all three measures ended two-week losing streaks as the S&P 500 added 2.7%, the Nasdaq climbed 2.8%, and the Dow rose 3.1% to its best week since July 9, 2010.

While several reasons could be cited for last week’s performance, the primary piece of good news was that fourth quarter GDP outperformed previous estimates as businesses maintained spending and demand. U.S. GDP increased at a 3.1% annualized rate, revised up from the 2.8% reported one month ago, and pleasantly surprised analysts.

Investor’s hopes have also boosted in anticipation of next Friday’s jobs report from the Labor Department. Payrolls increased by 195,000 workers this month, the most since May 2010 according to a preliminary survey by Bloomberg News. Manufacturing grew at its fastest pace in seven years, while record exports and consumer spending are prompting many companies to boost hiring. In light of these positive reports, Libya, the series of events in Japan and new changes in the Eurozone – circumstances which previously shook investor’s confidence – appear to have left markets unfazed last week.

As we have seen in times past, it is impossible to pinpoint exactly when markets will persevere or turn bearish. Last week’s reversal thus illustrates that the markets do not always behave rationally.

ECONOMIC CALENDAR: Monday – Personal Income & Outlays, Pending Home Sales Index Tuesday – S&P Case-Shiller HPI, Consumer Confidence Wednesday – ADP Employment Report, EIA Petroleum Status Report
Thursday – Jobless Claims, Chicago PMI, Factory Orders
Friday – Motor Vehicle Sales, Employment Situation, ISM Mfg Index, Construction Spending Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. NA means not available.

HEADLINES:

The U.S. Postal Service announced plans to shutter seven district offices (located in Columbus, South East Michigan, Northern Illinois, South East New England, South Georgia, Big Sky and Albuquerque) eliminating 7,500 jobs. When fully implemented, the Postal Service estimates the cuts will lead to about $750 million in annual savings. The agency also plans to close as many as 2,000 post offices over the next year and hopes to end Saturday delivery service.

On the heels of Portuguese Prime Minister Jose Socrates’ resignation over austerity measures, an EU Summit was held last week to negotiate the details of the European Stability Mechanism. In 2013, the ESM will have a lending capacity of 500 billion euros. Standard & Poor's downgraded Portugal's long-term credit, bringing the country's credit standing closer to junk status. A bailout may wait till June as the country needs to first figure out its political situation.

Japanese engineers struggled to pump radioactive water from a crippled nuclear power station after radiation levels soared in seawater near the plant. Prolonged efforts to prevent a meltdown at the 40-year-old plant have also intensified concern around the world about nuclear power. The crisis at the plant, 150 miles north of Tokyo, has overshadowed a big relief and recovery effort from the magnitude 9.0 quake and the huge tsunami it triggered on March 11 that left more than 27,100 people dead or missing in northeast Japan.

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Insert your broker/dealer disclosures here. i.e. Securities offered through “Your B/D Name Here,” Member FINRA/SIPC.

Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.
These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative or named Broker dealer, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

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2011-03-21T09:26:00.000-07:00

March Madness continues for US markets … By Ken Mahoney

The markets bounced back on Monday as investors embraced ‘Monday Merger Mania’. AT&T announced a 39 Billion Dollar deal to buy competitor T-Mobile. Investors are also hoping that the crisis in Japan is stabilizing ‘a bit’, while the Libya conflict will be measured in ‘days’.

Between situations in Japan and Libya, stocks faced some serious headwinds last week. The Dow declined 1.5%, the S&P 500 fell 1.9% and the Nasdaq dropped 2.7%. The Libyan cease-fire announcement temporarily calmed concerns about developments in the Middle East on Thursday and Friday, but ongoing uncertainty eventually caused the rally to slow and it wasn’t enough to recover from Wednesday’s thrashing.

Recent events, including the nuclear disaster in Japan, international forces b
ombing in Libya, and the possibility of more currency market intervention will likely keep investors reacting to headlines in the weeks ahead. We are currently facing an extremely media-driven market that responds quickly to what is visible in the news. At times like this, it is more important than ever to avoid trading based on emotion rather than facts or fundamentals. Even when things are uncertain, there are often many promising opportunities to be found.
Consider one example:
Some people see huge opportunities in Japan. Since experts are optimistic that the earthquake's impact will have a relatively mild long-term effect on Japan’s economy, a cross-section of investors are watching the Japanese market with the intent to invest – viewing the Nikkei’s sharp drop as the best time to get in. In fact, a whopping $956 million flowed into Japanese equities in the week ending March 16 alone, according to data from Thomson Reuters Lipper service. While we are not necessarily advocating this strategy for you, it does highlight the importance of seeking out opportunities even when things look grim.

Despite the complicated and unpredictable elements at play, these events remind us of the nature of the markets: ups and downs are to be expected. Although we've quoted him before, now is a good time to recall the words of billionaire investor Warren Buffet who said, “Be Fearful When Others Are Greedy and Greedy When Others Are Fearful”. And always remember, we’re monitoring the situation closely.

ECONOMIC CALENDAR: Monday – Existing Home Sales Tuesday – Redbook Wednesday – New Home Sales, EIA Petroleum Status Report
Thursday – Durable Goods Orders, Jobless Claims Friday – GDP, Consumer Sentiment

.

HEADLINES:
America’s top military commander says a United Nations-authorized no-fly zone over Libya has effectively been achieved. The Chairman of the U.S. Joint Chiefs of Staff, Admiral Mike Mullen, is calling the initial phase of a multi-national effort to take control of Libyan airspace a success. Mullen says Libyan command-and-control centers and air defense installations have been struck, and that leader Moammar Gadhafi’s forces effectively are grounded.

The U.S. cost of living hit a record high (127.4) in February, according to the Chained Consumer Price Index. The previous high of 126.9 was reached in July 2008, before economic markers like unemployment and stock prices were affected. Simultaneously, states will be cutting back services this year at the same time they increase taxes in order to close enormous budget deficits.

Japanese government officials say food and milk contaminated with radiation is being detected in a wider than expected area. Some shipments are now being stopped, although authorities stress that ingesting the items will not immediately harm people.

Nissan Motor Co. said Sunday that it will start parts production and vehicle assembly operations this week in Japan, becoming the first car maker to restart its entire auto production process after a devastating quake brought the country's auto industry to a standstill.

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Insert your broker/dealer disclosures here. i.e. Securities offered through “Your B/D Name Here,” Member FINRA/SIPC.

Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
The Nikkei is an Index of 225 leading stocks traded on the Tokyo Stock Exchange.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.
These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative or named Broker dealer, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

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Japan’s earthquake sends shock waves around the Globe Ken Mahoney

2011-03-14T08:31:00.000-07:00

Japan’s earthquake sends shock waves around the Globe Ken Mahoney

On Friday, an 8.9 earthquake rocked Japan and generated a 30-foot-high tsunami that devastated the northeastern coast. In consideration of the widespread destruction, human suffering is the issue of primary concern at this time. Simultaneously though, it is crucial to consider the economic impact of this natural disaster. What affects are we already experiencing?

Though Japan’s recession-burdened stock markets dropped, the expected scope of the rebuilding effort sent U.S. stocks climbing on expectations for increased demand for materials. Interestingly, we also saw a $3 a barrel drop in oil prices inspired by anticipation of decreased Japanese demand. At the same time, some speculate that the probable increase in Japan’s spending has the potential to propel their already strong currency, the yen, higher as Japanese money invested abroad is applied to rebuilding. How long and to what extent such factors will influence the world economy remains to be seen.

The earthquake also took a heavy toll on the nation’s industries, forcing Toyota, Honda and Nissan to halt operations at most of their domestic plants. These shutdowns come at a time of strong recovery in global consumption (U.S. auto sales clocked their strongest pace in 18 months in February ). Also suspending operations are Panasonic, Sony, and Toshiba. A bigger impact will likely come in the weeks ahead as the disruptions make their way through the global supply chain.

In today’s world, we exist as part of a connected, global community. And although it is fitting to discuss how international situations can have an impact domestically, we should also remember that such analysis cannot diminish Japan’s catastrophic losses. While the weeks and months ahead will gradually reveal the extent of the disaster, it will also give us a chance to demonstrate our humanity and generosity.

SPECIAL NOTE: While we do not want to discourage you from donating toward relief efforts in Japan, we urge you to exercise caution. Whenever a natural disaster strikes, there are always unscrupulous individuals who will attempt to take advantage of the generosity of those who wish to give. Many reputable sources warn donors to be cautious when making contributions to relief agencies and charities. Please visit the Better Business Bureau’s Wise Giving Alliance for more information about how to donate safely. See www.bbb.org/charity.

ECONOMIC CALENDAR: Tuesday – Empire State Mfg Survey, Import and Export Prices, Treasury International Capital, Housing Market Index, FOMC Meeting Announcement Wednesday – Housing Starts, Producer Price Index, EIA Petroleum Status Report
Thursday – Consumer Price Index, BOE Announcement, International Trade, Jobless Claims, Industrial Production, Leading Indicators, Philadelphia Fed Survey

HEADLINES:
Professional-football players disbanded their union and filed a lawsuit against the NFL and team owners on Friday. The collapse of the talks makes it likely that NFL owners will bar their players from turning up to work and withholding their paychecks. The players filed suit for the right to be allowed to work.

U.S. consumer sentiment fell to its lowest level since October 2010 as gasoline prices rose. The preliminary March reading on the overall index on consumer sentiment came in at 68.2, down from 77.5 in February. The numbers were in contrast to the retail sales report earlier Friday, which showed sales posted their largest gain in four months in February.

House Republicans are preparing another stopgap-spending bill that would cut $6 billion from current levels and keep the government running for three more weeks. The stopgap-spending bill would buy lawmakers more time after existing funding authority expires on March 18 to agree on final spending levels for the 2011 fiscal year, which ends September 30. The Senate would have to approve it as well before it could be sent to President Obama to sign into law.

Forbes 2011 Billionaires List breaks two records: total number of listees (1,210) and combined wealth ($4.5 trillion). Mexico's Carlos Slim Helu, added $20.5 billion to his fortune, and is now worth $74 billion. Bill Gates (#2) and Warren Buffett (#3) both added a more modest $3 billion to their piles and are now worth $56 billion and $50 billion, respectively.

Share the Wealth of Knowledge!
Please share this market update with family, friends, or colleagues. If you would like us to add them to our list, simply click on the "Forward email" link below. We love being introduced!

Insert your broker/dealer disclosures here. i.e. Securities offered through “Your B/D Name Here,” Member FINRA/SIPC.

Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.
These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative or named Broker dealer, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

By clicking on these links, you will leave our server as they are located on another server. We have not independently verified the information available through this link. The link is provided to you as a matter of interest. Please click on the links below to leave and proceed to the selected site.

What did Fed Chair Bernanke say about rising oil and our US economy? Ken Mahoney

2011-03-07T10:42:00.000-08:00

What did Fed Chair Bernanke say about rising oil and our US economy? Ken Mahoney

As of late, the big question on everyone’s mind has been: Will the recovery stick? And while the talking heads have been debating their positions on the issue, the chief talking head himself – Federal Reserve Chairman Ben Bernanke – appeared before the House Financial Services Committee and a Senate panel last week to offer his semiannual report on the state of the economy.

What was the word? Bernanke said the economy is gaining traction and stressed that the Fed is prepared to act if higher commodity prices start to have a negative effect on U.S. growth. His comments also offered a brighter outlook on the status of rising energy costs, inflation risk, and job creation. Good news indeed!

While acknowledging that a prolonged rise in oil prices could pose a danger to the economic recovery, the Fed chief countered that other risks to the economy, including rising commodity prices, were more likely to affect consumer spending. At the same time, Bernanke reiterated his commitment to keeping inflation low, and added: "I recognize that the increases in gas prices are very troubling… but they are not inflation per se. Inflation is an increase in the overall price level, which is very low. The inflation rate right now is 1.2% for all goods and services".
As for jobs, Bernanke expressed confidence that growth would increase this year. Supporting his view, the Labor Department announced on Friday that the nation’s unemployment rate fell to 8.9% in February, the lowest level in two years. The report suggests that companies are gaining confidence in the economy and their own financial prospects. It also strengthens hopes that businesses will shift into a more aggressive hiring mode to heighten momentum for the ongoing recovery.

Against the backdrop of geopolitical turmoil that has packed the headlines in recent weeks, the Fed chairman’s testimony offered a positive perspective on the improving state of the American recovery.

HEADLINES:
On Tuesday, Apple Chief Steve Jobs introduced the world to the iPad2, a sleeker, faster follow-up to the original. The market sent shares of Research in Motion down 0.3%, and Motorola was down by over 4%. The new iPad2 sports front and back facing cameras, more memory, and a faster processor, but despite the upgrades, the iPad2 starts at $499, while Xoom tablets will run between $599 and $799.

President Barack Obama said Saturday that he is willing to offer deeper spending cuts if it means Republicans and Democrats can work out their differences and reach an agreement on the federal budget. The standoff over government spending intensified this past week as Republicans ripped the White House’s offer to make $6.5 billion in budget cuts this fiscal year, and the threat of a government shutdown lay over the horizon. Government operations are now running on a stopgap funding measure that expires on March 19.

U.S. manufacturers expanded at the fastest pace in nearly seven years last month, but a sudden rise in the price of raw materials could threaten their profits. The Institute for Supply Management said its index of manufacturing activity rose to 61.4 in February, the highest reading since May 2004. But prices paid for steel, plastics, rubber and other raw materials rose for a third straight month, a sign that increasing production costs could spark higher inflation.

National Football League owners and players agreed Friday to a seven-day extension to contract talks in an effort to resolve the league’s labor dispute. The agreement means the CBA will remain in force until the night of March 11 and averts the threat of a lockout by the owners or a lawsuit by the players for at least a week. The owners were due to earn about $4 billion in TV money this coming season, even in the event of a lockout.

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Will higher oil prices derail the US economy? Ken Mahoney

2011-02-28T16:40:00.000-08:00

Will higher oil prices derail the US economy?
By Ken Mahoney

As turmoil in the Middle East continues to roil the markets, it is no coincidence that "oil" is at the root of economic concerns. From an investment perspective, analyzing oil's relationship to the markets is crucial, but the reality is that nearly everyone (investors and non-investors alike) are affected by oil prices. So what exactly is affecting the rise in oil costs? And, more importantly, do oil prices have the potential to derail America's economic recovery?

After the fall of dictatorial governments in Tunisia and Egypt, unrest has spread throughout the Middle East, with Libya dominating the spotlight this week. The International Energy Agency reported late Friday that Libya is probably producing about 850,000 barrels of oil daily, down from its normal capacity of 1.6 million barrels, which represents just under 2% of the world's oil supply. While the sudden oil shortage hits European refiners the hardest, oil fears still caused the stock market to suffer its first weekly loss in a month. For the week, the S&P 500 slid 1.7%; the Dow dropped 2.1%, and the Nasdaq fell 1.9%. Happily, fears were eased somewhat on Friday when Saudi Arabia reported it has increased its crude oil production to 9 million barrels a day to make up for supplies lost in Libya.

What we're seeing right now is a tug of war between worry and economic fundamentals. While most U.S. economic data looks good, investors are focused on the potential implications of interruptions in oil production. For the moment, this issue will dominate the headlines regardless of how attractive other data looks.

U.S. drivers have already been feeling the pinch at the pump, with gas prices spiking 6 cents on Friday, the biggest one-day jump in two years. The national average price for a gallon of regular gas rose to $3.29, according to AAA, marking the fourth day in a row that prices have risen and bringing the national average to the highest level since October 2008. In general, every $1 increase in the price of oil costs consumers $1 billion over the course of a year. Higher oil prices also weigh on the U.S. economy by increasing the costs of moving goods, thus transferring rising costs to manufacturers, wholesalers, retailers, and eventually the American public.

If gas prices continue to rise as some analysts predict, how will this affect the economic recovery? Put simply, there is no way to know for sure. Granted, when gas prices go up, Americans have less to spend on everything else. And since consumer spending makes up over 70% of the U.S. economy , a drop in spending could slow the recovery down. At the same time though, modest increases in fuel prices do not inevitably cause economic slowdowns. What they more often do is cause alarm, thus affecting consumers' perceptions about what they can afford and causing them to react by tightening their belts.

So while the natural reaction may be to retreat to conservative investments and cut-off all spending on nonessentials, it is important to avoid overreacting. The coming week promises to shed more light on the true status of our domestic economy as various data related to jobs, payrolls, and manufacturing are released.

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Mr. Mahoney is a registered broker with Aurora Capital LLC, registered broker-dealer with U.S. Securities and Exchange Commission, member FINRA/MSRB/SIPC. Clearing through Legent Clearing LLC, member FINRA/MSRB/SIPC.

*Stock investing involves market risk including loss of principal. The fast price swings of commodities will result in significant volatility in an investor's holdings. Government bonds and Treasury Bills are guaranteed by the US Government as to the timely payment of principal and interest and, if held to maturity, offer a fixed rate of return and fixed principal value.
Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.
The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.
These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative or named Broker dealer, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

Markets climb to 2 ½ year highs, what’s next? Ken Mahoney

2011-02-14T08:59:00.000-08:00

Markets climb to 2 ½ year highs, what’s next? Ken Mahoney

Wall Street started last week holding its breath while waiting to see whether Hosni Mubarak would step down as Egypt’s president. Bowing to pro-democracy protests, Mubarak resigned on Friday, ending 30 years of authoritarian rule in the Middle East’s most populous country.

As fireworks burst over Cairo’s Tahrir Square, there was a collective sigh of relief on Wall Street, while the benchmark averages rose to finish Friday’s session with weekly gains. U.S. stocks climbed to fresh 2 1/2-year closing highs after the resignation of Mubarak removed a layer of uncertainty from global markets. The Dow had a weekly advance of 1.5%, while the S&P 500 rose 1.4% and the Nasdaq added 1.5%.
Analysts and investors agree that Mubarak’s resignation dramatically reduces geopolitical risk and uncertainty from the region.

Reflecting this, oil prices fell following the news in Egypt, with crude dropping to $85.16 a barrel in midday trading Friday. Other dollar-denominated commodities, including gold and silver, also drifted lower following Mubarak's resignation. Gold prices slid $5.30, settling at $1,357.20 an ounce.

On another topic, how does starting a new week on St. Valentine’s Day traditionally affect the markets? Interestingly, the “day of love” hasn’t customarily shown much “love” to investors; at least when using the S&P 500 index as a gauge. According to Howard Silverblatt, a senior index analyst at S&P Indices, going back to 1928, February 14 trading days only notched gains on the S&P 38.7% of the time against a historical daily rate of 52.03%. Here’s an interesting caveat though – in looking at the 11 Valentine’s Days that occurred on the first trading day of the week, the S&P 500 logged a gain 63.4% of the time. While we’re certainly not trying to make a prediction, it is interesting to see what history can teach us about market behaviors.

From war and peace one week, to love and chocolates the next, it just goes to show that almost any world event has potential to affect people’s investments. Like everything in life, weathering all the little ups and downs requires intelligence, patience, and a cool head.

ECONOMIC CALENDAR:
Tuesday – Retail Sales, Empire State Mfg. Survey, Import and Export Prices, Redbook, Treasury International Capital, Business Inventories, Housing Market Index Wednesday – Housing Starts, Producer Price Index, Industrial Production, EIA Petroleum Status Report, FOMC Minutes
Thursday – Consumer Price Index, Jobless Claims, Industrial Production, Leading Indicators, Philadelphia Fed Survey

Data as of 02/11/2011 1-Week YTD 1-Year 5-Year 10-Year
Standard & Poor's 500 1.39 5.69 23.2 0.98 0.11
Dow 1.50 6.01 20.9 2.48 1.38
NASDAQ 1.45 5.90 29.0 4.84 1.37
MSCI EAFE 0.07 4.48 17.6 1.71 N/A
10-year Treasury Note (Yield Only) 3.65 N/A 3.73 4.58 5.02

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. NA means not available.

HEADLINES:
Pandora Media Inc., filed papers Friday to raise as much as $100 million in an initial public offering of stock. Pandora offers an Internet service that creates playlists of songs based on user feedback. The Oakland, Calif.-based company said it now has more than 80 million registered users, and “a more than 50% share of all Internet radio listening time among the top 20 stations and networks in the United States.”

The euro fell to a three-week low against the dollar as speculation increased that Portugal will follow Ireland in tapping the European Financial Stability Facility. Yields on 10-year Portuguese debt climbed on Feb. 10 to 7.64 percent, the highest level since the introduction of the euro in 1999.

U.S. consumer sentiment rose to its highest level in eight months in early February, boosted by recent tax cuts and optimism about the economy. The preliminary February reading for the overall index on consumer sentiment came in at 75.1, up from 74.2 in January, the highest level since June 2010.

The Commerce Department says the deficit in December increased 5.9% to $40.6 billion. It grew because the 2.6% gain in imports outpaced the 1.8% rise in exports. For 2010, the U.S. trade deficit rose to $497.8 billion, a 32.8% surge and the biggest annual percentage gain since 2000.

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*Stock investing involves market risk including loss of principal. The fast price swings of commodities will result in significant volatility in an investor’s holdings. Government bonds and Treasury Bills are guaranteed by the US Government as to the timely payment of principal and interest and, if held to maturity, offer a fixed rate of return and fixed principal value.
Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.
These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative or named Broker dealer, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

2011-02-07T11:43:00.000-08:00

Investor’s are more optimistic

In spite of ongoing turmoil in Egypt and the Middle East, the markets continued their gain last week. For the period ending February 4th, the Dow, the S&P 500, and the Nasdaq all climbed reflecting elevated optimism in the markets. The AAII Sentiment Survey for last week shows that 51.5% of investors are feeling bullish, up 9.5% from the week of January 24th. That’s well above the historical average of 39%.
Indeed, this optimism is even more remarkable in light of last week’s jobs report which has been subject to conflicting opinions and interpretations. Case in point: According to a MarketWatch headline from Friday, the “job crisis isn’t over”, while a cnnmoney.com headline from the same day touted that, “the job market is getting better.” Each headline could be considered accurate, but clearly they offer different slants. Though the rate of hiring did not show a notable increase, the unemployment rate still fell to 9.0% - bad news and good news at the same time. Some analysts predict that bad weather across the U.S. is partially to blame, with more than 850,000 workers prevented from working at the time the survey was conducted. Other explanations have also been cited, and as a result, it appears that many are waiting for February’s report for clarification before jumping to conclusions.

Recent events, both within the U.S. and internationally, illustrate a noteworthy aspect of investing: It is impossible to predict how the stock market will react to news. Such an optimistic week in light of Egyptian strife and a conflicting jobs report is a pleasant surprise. It seems that the market has had time to price in geopolitical risks in Egypt and sluggish jobs growth and found such factors to be no immediate threat. Clearly, the headlines and the stock market do not always move in tandem. This is a good fact to remember when evaluating how much credence should be given to sensational news reports.

ECONOMIC CALENDAR
Tuesday – Redbook
Wednesday – Bank Reserve Settlement, EIA Petroleum Status
Thursday – BOE Announcement, Jobless Claims, Wholesale Trades, Treasury Budget Friday – International Trade, Consumer Sentiment

Data as of 02/04/2011 1-Week YTD 1-Year 5-Year 10-Year
Standard & Poor's 500 2.71 4.23 23.3 0.74 -0.29
Dow 2.27 4.45 20.9 2.41 1.13
NASDAQ 3.07 4.39 30.3 4.48 0.41
MSCI EAFE 3.16 3.93 15.7 -0.41 1.56
10-year Treasury Note (Yield Only) 3.33 N/A 3.61 4.53 5.14

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. NA means not available.

HEADLINES:

The Green Bay Packers won its fourth Superbowl title in a 31-25 victory over the Pittsburgh Steelers. The Vince Lombardi Trophy is headed back to Titletown for the first time in 14 years.

Super Bowl-related consumer spending will reach $10.1 billion this year, the National Retail Federation says. The Washington-based trade group cites a survey conducted by its Retail Advertising and Marketing Association division that says the average consumer will spend $59.33 on game-related merchandise, apparel and snacks, up from $52.63 last year.

Hackers have repeatedly penetrated the computers running Nasdaq during the past year. Though the exchange’s trading platform was not violated and no information has been compromised, a federal investigation is underway.

Businesses’ unemployment-insurance payments rose 37% in 2010. Last year, the amount employers paid into state unemployment-insurance funds rose 34%. Combined with the increase in total wages, businesses paid out $43 billion.

On Friday, Bank of America appointed a new foreclosure and loan modifications czar, and created a new unit to oversee problem home loans. The new unit creates a seventh major division at the bank and will be overseen by Terry Laughlin. The move splits the largest U.S. bank by assets’ mortgage business: one focused on new and current mortgages, and another dedicated to foreclosures.

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*Stock investing involves market risk including loss of principal. The fast price swings of commodities will result in significant volatility in an investor’s holdings. Government bonds and Treasury Bills are guaranteed by the US Government as to the timely payment of principal and interest and, if held to maturity, offer a fixed rate of return and fixed principal value.
Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.
These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative or named Broker dealer, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

What impact will Egypt have on the Markets? Ken Mahoney

2011-01-31T09:19:00.000-08:00

What impact will Egypt have on the Markets? Ken Mahoney

U.S. stocks’ winning streak ended Friday amid news of political strife in Egypt. The Dow closed down 1.39%, the S&P 500 declined 1.79%, and the Nasdaq fell 2.48% -- the biggest single day losses in nearly six months. This pullback left many investors asking what political strife in Egypt has to do with the U.S. stock market. You may be wondering the same thing. So what is the answer?

While many factors are involved, the primary issue is that the stock market hates uncertainty. It’s an old adage, but one that is often true. On a fundamental level, the stock market is based on people’s speculation about what is going to happen in the future. Uncertainty about the future leads many to sell and/or sit on the sideline because they aren’t comfortable investing their money until they feel like they know what is ahead. For the time being, the situation in Egypt is anything but certain.

Uncertainty, combined with Egypt’s position along one of the busiest trade routes in the world, had a combined affect on the markets last week. The price of oil rose with fears about the stability of maritime operations on the Suez Canal. As a major trade route, any interruption or closure has the potential to create a spike in oil and energy prices. As a result, analysts predict a measure of volatility until calm is restored. As we saw on Friday, when volatility increases, a flight to safety often drives uneasy investors into so-called “safe havens”.

The affect of Egyptian politics on U.S. stock markets serves as a reminder that we are part of an intricate international economy. The ups and downs of the markets are rarely predictable, and a measure of risk is to be expected. Historically, stocks have outperformed all other investments, but in the short-term, fluctuations are inevitable. At times like this, rest assured that we will continue to monitor the situation abroad and bring you relevant information as soon as it becomes available.

ECONOMIC CALENDAR:
Monday – Personal Income and Outlays, Chicago PMI Tuesday – Motor Vehicle Sales, Redbook, ISM Mfg Index, Construction Spending
Wednesday – ADP Employment Report, EIA Petroleum Status Report
Thursday – ECB Announcement, Jobless Claims, Productivity and Costs, Factory Orders, ISM Non-Mfg Index Friday – Employment Situation

HEADLINES:
The United Nations reported that international food prices rose by an all-time high of 25% in December. The rising costs for staples like rice, wheat, and maize have been affected by bad weather in Australia and Russia, rising incomes in China and India, and a push for biofuels. The sharp inflation in food costs has sparked political unrest throughout the Middle East, including Egypt and Tunisia.

The GDP figures for the last quarter showed that consumer spending was up a strong 4.4% on an annualized basis, and final sales surged 7.1%, its largest jump in nearly 30 years. Trade was a big contributor to the economic gains, with exports surging 8.5% and imports declining 13.6%. Inventories grew by $121 billion in the third quarter, but only rose by $7 billion in the final three months of the year.

Comcast Corp., took control of NBC Universal shortly before midnight on Friday. The deal comes after the government shackled Comcast’s behavior in the coming years to protect online video services such as Netflix and Hulu. The takeover gave Comcast 51% control of NBC Universal, which owns the nation's fourth-ranked broadcaster, NBC, the Universal Pictures movie studio and related theme parks, and a bevy of cable channels including Bravo, E! and USA.

Chinese authorities have blocked the word "Egypt" from searches on Twitter-like microblogging sites in an indication of concern among Communist Party leaders that the unrest there could encourage similar calls for political reform in China.

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Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.
These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative or named Broker dealer, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

Stock prices and gas prices both are rising, what happens next? By Ken Mahoney

2011-01-24T08:43:00.000-08:00

Stock prices and gas prices both are rising, what happens next? By Ken Mahoney

While the recovery continues to burn brighter, it’s no thanks to the rising cost of gasoline. Most consumers are cringing over prices at the pump and, as a nationwide economic marker, it affects nearly everyone.

Gas prices hit almost $3.12/gallon on Friday, less than a dollar below the all-time high of about $4.11/gallon in July 2008. Current prices have risen 12 cents a gallon (4%) in the last month alone and 39 cents (14%) over the last year. Crude oil has risen on a similar track and is currently trading at just under $90 a barrel.

Though American consumers are paying the price, international oil demand and lack of supply are primarily responsible for the rising cost. Last year, worldwide demand hit a record of more than 87 million barrels a day, largely driven by strong growth in India, China, and the Middle East. Simultaneously, supply was constricted by the drilling moratorium in the Gulf of Mexico following the BP disaster, slow production growth in non-OPEC countries, and OPEC production controls.

Gas prices are proving to be a critical, but unpredictable element in the economic recovery. Analysts are predicting prices to range from $3.20 to $3.75/gallon by spring, just when Americans typically hit the road. Just as positive consumer sentiment can be tempered by the daily reminders of rising prices, there is also an unknown tipping point for when those prices take a toll on spending.

While all this talk about rising gas prices may have you feeling less than enthusiastic, the overall economic outlook is still positive and the stock market is performing well. While some indexes fell slightly for the week, the Dow climbed 0.72%, continuing its longest winning streak since April of last year. At least for now, rising gas prices aren’t creating a significant drag on the economic recovery.

ECONOMIC CALENDAR:
Tuesday – Redbook, S&P Case Shiller HPI, Consumer Confidence
Wednesday – New Home Sales, EIA Petroleum Status Report
Thursday – Durable Goods Orders, Jobless Claims, Pending Home Sales Friday – GDP, Employment Cost Index, Consumer Sentiment

Data as of 01/21/2011 1-Week YTD 1-Year 5-Year 10-Year
Standard & Poor's 500 -0.76 2.04 14.9 0.35 -0.44
Dow 0.72 2.54 14.3 2.26 1.21
NASDAQ -2.39 1.38 18.7 3.93 -0.29
MSCI EAFE -0.35 1.83 7.12 -0.43 1.32
10-year Treasury Note (Yield Only) 3.33 N/A 3.61 4.36 5.17

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. NA means not available.

HEADLINES:

Facebook raised $1.5 billion from Goldman Sachs and Digital Sky Technologies, giving the company an estimated value of $50 billion. Facebook confirmed that it will begin filing public financial reports by April 2012, a move likely indicative of an IPO.

A 1963 Pontiac ambulance that supposedly carried the body of President John F. Kennedy after his assassination was sold at a Scottsdale, Ariz., auction Saturday night for $132,000.

Existing home sales jumped 12% in December, the fifth month of gains in the past six months. While the rates are higher than expected, the median price of homes has fallen by 1% and is still down 2.9% from a year ago.

Thirty-second advertising spots for 2011’s Super Bowl XLV will cost about $3 million each. This year’s ads contain a record number from the auto industry, while the largest advertisers include Anheuser-Busch and Dot-com firms. Many will include online features with contest components.

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Insert your broker/dealer disclosures here. i.e. Securities offered through “Your B/D Name Here,” Member FINRA/SIPC.

Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative or named Broker dealer, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

How long can the bull market ‘winning streak’ continue By Ken Mahoney

2011-01-18T09:18:00.000-08:00

How long can the bull market ‘winning streak’ continue? By Ken Mahoney

The bluebird of happiness has landed in the headlines again. In the longest winning streak since April 2010, the Dow posted its seventh straight week of gains as investors fly in the face of lackluster economic data. Driven by a rally in the financial sector, U.S. stocks reached their best closing levels in two and a half years.

Despite higher than expected unemployment numbers, more Americans are dining out, traveling, and paying down their debt – all signs that people are feeling more confident in their spending ability. The National Retail Federation reported that holiday retail sales showed the biggest percentage gain in six years, rising 5.7%.

While the recent increase in optimism is a relief, it is prudent to remember that too much optimism can be dangerous. It is especially during times when euphoria is spreading that we need to be realistic and balanced in our expectations. In the words of noted stock investor, businessman and philanthropist Sir John Templeton, “Bull markets are born in pessimism, grow on skepticism, mature on optimism and die on euphoria.” Despite recent positive developments, many investors remember these timely words. There are still a number of challenges worth keeping an eye on, such as sovereign debt concerns in Europe, and the rising cost of basic goods. Keeping such issues in mind helps maintain a balanced approach toward investing.

While we are not recommending that any specific action be taken, we are highlighting the importance of avoiding the type of irrational exuberance that leads to poor, emotional decision making. If you have questions, please remember that we are always here to help you balance the risks and the rewards associated with investing.
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HEADLINES:

The U.S. federal government will bill states $1.3 billion in interest on jobless-pay loans. Thirty states owe money to the federal government for their unemployment programs. The first interest payment on the borrowed $41 billion is due in September.

Wall Street is facing its first blitz of fourth-quarter earnings, with Bank of America Corp., General Electric Co. and Apple Inc. among the industry titans slated to report in coming days. With the U.S. financial markets closed Monday for Martin Luther King Jr. Day, Wall Street faces a holiday-shortened week.

BP and Russia's state-controlled Rosneft agreed to a share swap under which they would jointly explore for offshore oil and gas, in a deal that immediately raised concerns in the United States about Russia's global oil ambitions. The deal gives BP access to highly sought after reserves of oil and natural gas in Russia's remote Arctic region. BP will trade 5% of its shares, for 9.5% of Rosneft.

The People's Bank of China raised the level of reserves that banks are required to hold by one half of a percentage point. Major Chinese banks will have to set aside 19% of their reserves and small and medium banks will have to keep 15.5% of their deposits as reserves, a record high for the country's deposit-taking institutions. This is the seventh time in the last year that the bank has used higher reserve standards to try to pull money out of the economy and tame rising prices.

Share the Wealth of Knowledge!
Please share this market update with family, friends, or colleagues. If you would like us to add them to our list, simply click on the "Forward email" link below. We love being introduced!

Insert your broker/dealer disclosures here. i.e. Securities offered through “Your B/D Name Here,” Member FINRA/SIPC.

Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative or named Broker dealer, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

What does the 2010 Tax Relief mean to you? By Ken Mahoney

2011-01-10T08:35:00.000-08:00

What does the 2010 Tax Relief mean to you? By Ken Mahoney

After waiting until almost the last minute, Congress averted tax increases that would have affected taxpayers at all income levels and added some 15 million lower-income workers to the tax rolls.1

Had Congress not passed the 2010 Tax Relief Act (H.R. 4853), tax rates for income, capital gains, dividends, and estates would have reverted to higher pre-2001 levels in 2011. Rates for these taxes were reduced in 2001 and 2003 but were subject to a December 31, 2010, expiration date because of the political climate at the time. The new law pushes their expiration dates to December 31, 2012.

Despite the uncertainty created by yet another temporary tax law, there are many encouraging provisions that result in some of the most favorable tax conditions Americans have seen in a generation.

What’s New and What’s Not?

One-year payroll tax cut. Employees may notice slightly more take-home pay in 2011 because their share of the payroll tax, which is used to fund Social Security, has been temporarily reduced to 4.2% of income (on up to $106,800 in taxable wages). For the self-employed, the payroll tax has been reduced to 10.2%. The employer’s share of the payroll tax, equal to 6.2% of an employee’s pay, did not change.

Estate tax revival. Although the federal estate tax is back after being repealed in 2010 (for one year only), the new parameters are more generous than those that had been scheduled for 2011 (a $1 million exemption and a 55% top tax rate).

For individuals who leave behind an estate before December 31, 2012, assets in excess of a $5 million applicable exemption will be subject to a top rate of 35%. Married couples who take the appropriate steps may be able to pass up to $10 million tax-free to their heirs.

The new law also brings back the stepped-up basis rules, which allow heirs to calculate their basis in an asset according to its value on the date of inheritance. Heirs who inherited assets in 2010 can elect to use the modified carryover basis rules that were in place for that year (meaning they must calculate capital gains using the decedent’s basis) or they can apply the new $5 million exemption and 35% top rate and use the stepped-up basis rules.

Gift tax reunified with the estate tax. Gifts in excess of the donor’s $5 million lifetime exemption are subject to a maximum 35% rate.

Itemized deductions for high incomes. The repeal of the so-called Pease limitation, which reduces the use of certain deductions for taxpayers with incomes in excess of certain levels, has been extended through 2012.

No phaseout of the personal exemption. High-income taxpayers will be allowed to claim the full personal exemption through 2012. Prior to 2010, the exemption was phased out for taxpayers with incomes in excess of certain thresholds.

Two more years of AMT relief. Middle-income taxpayers may be able to avoid the alternative minimum tax for at least two more years. The AMT was crafted in 1970 to keep wealthy taxpayers from using exemptions and deductions to avoid income taxes, but it has started to affect less affluent taxpayers because the limits aren’t indexed to inflation. The new exemption amounts for 2010 and 2011 are $47,450 and $48,450, respectively, for single filers ($72,450 and $74,450, respectively, for married taxpayers filing jointly).

Capital gains and dividends. Long-term capital gains and qualifying dividends will continue to be taxed at a 0% rate for individuals in the 10% and 15% income tax brackets and at a maximum 15% rate for other taxpayers. After 2012, long-term capital gains will be taxed at a maximum 20% rate and dividends will be taxed as ordinary income.

Income taxes. The 2010 Tax Relief Act includes a two-year extension of the income tax rates that have been in effect since 2003. These are the 2011 income limits:2

These are just the highlights. Several other provisions have been extended. Before you take any action, consult your tax advisor for information about your situation.

1) The Wall Street Journal, December 17, 2010
2) CCH, 2010 (Income limits are projected. Actual limits may vary.)

The information in this article is not intended as tax or legal advice, and it may not be relied on for the purpose of avoiding any federal tax penalties. You are encouraged to seek tax or legal advice from an independent professional advisor. The content is derived from sources believed to be accurate. Neither the information presented nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. This material was written and prepared by Emerald. © 2011 Emerald Connect, Inc.

2010, the year in review, and a look at 2011 prospects by Ken Mahoney

2011-01-03T09:39:00.000-08:00

2010, the year in review, and a look at 2011 prospects by Ken Mahoney

2010 was truly a year for the history books! The Standard & Poor’s 500 began January at 1115, and then crisscrossed that line 165 times to eventually end the ride with its finest December performance in 19 years. The Dow’s second-straight annual increase was equally dramatic, with almost half of its climb (5.2%) occurring in December.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. Indexes cannot be invested into. Chart is for illustration purposes only.
More than a few factors influenced the roller coaster ride of last year. Here are a few of the highlights:

January – Stocks start out looking good at 15-month highs.

February – European debt concerns take center stage as investors fear Greece will default and trigger a landslide that continues into Portugal, Italy, Ireland and Spain. Anxiety about these areas tug at the markets all year.

April – In a series of left hooks, the SEC files charges against Goldman-Sachs related to improper sale of securities tied to subprime mortgages, the BP oil spill fiasco begins, and Greece requests a $53 billion bailout.

May - Wall Street experiences the infamous “Flash Crash” that sends the Dow plunging almost 1,000 points in just a matter of minutes.

July – Stocks sink to 2010 lows as June’s jobs report disappoints. President Obama signs the Frank-Dodd Wall Street Reform and Consumer Protection Act into law, enacting the most far-reaching financial reform since the 1930s.

November – Republicans win back the House in mid-term elections - a shift in power that is generally seen as a win for Wall Street. The Fed unveils a $600 billion bond-buying stimulus program called quantitative easing, and the Dow and Nasdaq touch 2-year highs.

December – President Obama signs the $858 billion tax cut deal into law. Stocks end the year on a high note with the S&P up 12%, the Dow up 10%, and the Nasdaq up 17%.
As we ride a wave of optimism into 2011, there are still a number of challenges to face. The Fed’s QE2 policy has many experts increasingly worried about inflation.

Home prices are falling again, leading to questions about a double-dip in the housing market recovery. And the economy continues to suffer from one of the longest job droughts in our nation's history, with the monthly unemployment rate lingering above 9% for 19 straight months.

Investors will also be paying attention to politics and global economics as the year begins. Congress will return this week with Republicans in control of the House, and while investors are hoping the new political landscape will deliver business-friendly policies, there's also the chance of political gridlock. In addition, Euro zone debt and China’s attempts to rein in inflation without derailing progress pose potential hurdles to overcome.

All things considered, the future looks bright for 2011. Bullish sentiment toward the stock market is spreading and investors are beginning to put more money into it than they are pulling out. There has been a recent decrease in unemployment claims which are currently at their lowest level since July 2008. And corporate earnings are strong, with a 32% growth rate estimated for S&P 500 companies in 2010’s fourth quarter.

The new year is beginning on a more positive note than many investors could have predicted given the challenges of 2010. And while we hope the economy and the stock market maintains its positive momentum, history teaches us that ups and downs are part of life. Whatever we face in the year ahead, rest assured that we will maintain a watchful eye on any factors that have the potential to affect you. May a bright and prosperous 2011 be yours!

ECONOMIC CALENDAR:

Tuesday – Motor Vehicle Sales, Redbook, Factory Orders
Wednesday – ISM Non-Mfg Index, EIA Petroleum Status
Thursday – Jobless Claims, Fed Balance Sheet, Money Supply
Friday – Employment Situation, Consumer Credit

Data as of 12/29/2010 1-Week 1-Year 5-Year 10-Year
Standard & Poor's 500 0.07 12.78 0.15 -0.47
Dow 0.03 11.02 1.60 0.73
NASDAQ -0.48 16.91 4.06 0.74
MSCI EAFE 0.68 4.90 -0.26 1.06
10-year Treasury Note (Yield Only) 3.35 3.81 4.38 5.11

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. NA means not available.

QUOTE OF THE WEEK:

“For last year's words belong to last year's language, and next year's words await another voice, and to make an end is to make a beginning.” – T.S. Eliot

Are the markets setting up for a positive 2011?

2010-12-27T11:33:00.000-08:00

Are the markets setting up for a positive 2011?

And, A note from us to you…

U.S. founding father Thomas Paine wrote: “The real man smiles in trouble, gathers strength from distress, and grows brave by reflection.” As we ponder the experiences of 2010, we cannot help but see timeless value in his words.

As one year draws to a close and the next unfolds before us, we are moved to reflect on the people and experiences that brought us to this point. Such reflection is essential because it helps us to be thankful for what we have, to grow in acuity, and to make prudent plans for the future.

From our perspective, providing you with sound financial guidance is about much more than numbers. It is about helping you ‘smile in times of trouble and gather strength in times of distress.’ More than that, it is about helping you ‘reflect’ on your personal experiences and aspirations so you can convert those into worthwhile, attainable goals for the future.

From the day we started working together, your goals became our goals; your trials, our trials. We consider it a privilege to serve you in this capacity, and we hope that you enjoy working with us as much as we enjoy working with you.
Thank you for all that you do. We look forward to continually growing our relationship in the years ahead!

THE MARKETS:

The final weeks of the year are traditionally light for the markets and 2010 is no exception so far. Thursday closed the week on a quiet note as the Dow rose a stingy 0.1%, and the three major indexes only moved about 1% higher for the week. Leading up to the Christmas holiday, it seems that both stocks and traders slipped quietly into vacation.

While gains have been modest in recent weeks, stocks are still on track to post double-digit increases for the year. And with good news surrounding consumer spending and consumer sentiment, the economy appears to have earned a break. The Commerce Department said spending rose 0.4% in November, slightly higher than economists had predicted, and experts calculate that the 2% cut in employee’s 2011 payroll taxes may fuel further spending in the year ahead. Interestingly, even if spending doesn't increase at all in December, it is on track to grow at an inflation-adjusted 4% annual rate in the fourth quarter, which would mark its fastest pace since 2006. "It looks like we've transitioned into a period of solid consumer spending," said Barclay’s Capital economist Dean Maki. "That makes it hard not to be optimistic about economic growth."

Obviously there are still a number of hurdles for the economy to overcome. Despite a recent increase in new home sales, we are still contending with a depressed housing market that could further damage household finances, prompting people to cut back spending. And at more than $91 a barrel, recent price hikes have earned oil a lump of coal in its stocking too. With oil prices at their highest levels in over two years and gasoline selling for an average $3.01 per gallon, this has the potential to squeeze a few pocketbooks.

Still, most of the economic news arrives just in time to offer fresh hope for the new year. Morgan Stanley economists boosted their fourth quarter GDP forecast to 4.5%, supported by the Commerce Department’s report that total orders for durable goods, excluding transportation, rose 2.4%, the best performance since last March. This increase in production bodes well for employment, where the recent drop in initial unemployment claims offers an additional glimmer of hope.
All in all, the year has ended more positively than it began. Stay tuned for our 2010 recap due in the week ahead. See you next year!

ECONOMIC CALENDAR:
Tuesday – Redbook, S&P Case-Shiller HPI, Consumer Confidence
Wednesday – EIA Petroleum Status Report
Thursday – Jobless Claims, Chicago PMI, Pending Home Sales Index, EIA Natural Gas, Farm Prices, Fed Balance Sheet, Money Supply
Friday – U.S. Holiday: New Year’s Day Observed

Data as of 12/23/2010 1-Week Y-T-D 1-Year 5-Year 10-Year
Standard & Poor's 500 1.12 12.7 12.2 -0.19 -0.38
Dow 0.65 10.9 10.6 1.27 0.88
NASDAQ 1.07 17.5 17.5 3.70 0.59
MSCI EAFE 0.65 4.20 4.61 -0.49 1.29
10-year Treasury Note (Yield Only) 3.48 N/A 3.75 4.38 5.00

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. NA means not available.

HEADLINES:
China's central bank has raised its interest rate for the second time in just over two months as the nation fights to keep inflation in check.
The gap between the rich and the middle class is larger than it has ever been due to the bursting of the housing bubble. The richest 1% of U.S. households had a net worth 225 times greater than that of the average American household in 2009, according to analysis conducted by the Economic Policy Institute, a liberal think tank. That's up from the previous record of 190 times greater, which was set in 2004.
The number of food stamp recipients increased 16% over last year. This means that 14% of the population is now living on food stamps. That's about 43 million people, or about one out of every seven Americans.
Taxpayers who claim deductions for home-mortgage interest, gifts to charity and state and local taxes will have to wait until middle to late February to file their 2010 returns. The Internal Revenue Service attributed the late start of the filing season to changes in tax law for 2010 that were finished last week. The agency needs extra time to put processing systems in place, the IRS said Thursday.

QUOTE OF THE WEEK:

“The greater danger for most of us lies not in setting our aim too high and falling short; but in setting our aim too low, and achieving our mark.”– Michelangelo

How will the extension of the Bush Tax Cuts benefit the economy next year? by Ken Mahoney

2010-12-20T08:13:00.000-08:00

How will the extension of the Bush Tax Cuts benefit the economy next year? by Ken Mahoney

After months of speculation about the future of Bush era tax cuts, closure finally came late Thursday when the House of Representatives approved an $858 billion tax package to extend them through 2012. The approval of the plan has been marked by an optimistic attitude in the markets and positive speculation about the future of the economic recovery. While the S&P 500 only edged up one point this week, it has gained nearly 6% since Obama agreed to compromise with Republicans on the tax plan , and all major indexes either closed at or touched 52-week highs at some point during the last five trading days.

The economy is also showing signs of gaining ground, as a slew of upbeat statistics – from rising retail sales to falling unemployment claims – indicate. The economy grew at an annualized pace of 2.5% in the third quarter, and expanded growth is expected into next year. In an interview late Friday, Former Federal Reserve Chairman Alan Greenspan told Bloomberg: “The U.S. economy unquestionably has some momentum. The fourth quarter looks good. The growth rate could be 3.5 percent or more.” He later expressed this pick up in the economy should lead to increased hiring, and that the unemployment rate should drop next year. This would certainly be a welcome development!

It will be interesting to see what affect the new tax bill has on stock market performance in the shortened trading week ahead. Regardless of how things go, we hope you will relax and enjoy some quality time off with your family and friends.

ECONOMIC CALENDAR:

Tuesday – Redbook
Wednesday – GDP, Corporate Profits, Existing Home Sales, EIA Petroleum Status
Thursday – Durable Goods Orders, Personal Income and Outlays, Jobless Claims, Consumer Sentiment, New Home Sales, EIA Natural Gas
Friday – U.S. Holiday: Christmas Observed

Data as of 12/17/2010 1-Week Y-T-D 1-Year 5-Year 10-Year
Standard & Poor's 500 0.28 11.5 13.5 -0.37 -0.52
Dow 0.72 10.2 11.5 1.13 1.01
NASDAQ 0.21 16.5 21.2 3.47 -0.04
MSCI EAFE -0.10 2.58 4.69 -0.71 1.02
10-year Treasury Note (Yield Only) 3.30 N/A 3.49 4.45 5.18

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. NA means not available.

HEADLINES:

The largest forfeiture settlement in U.S. history has recovered about half of Bernard Madoff’s stolen money. Barbara Picower returned $7.2 billion from her deceased husband’s estate. Jeffry Picower was a Florida businessman who had been the single-largest beneficiary of the fraud.

Bank of America said it will not process payments intended for WikiLeaks despite threats from the group that their next large documents release will be bank information. In related news, WikiLeaks founder, Julian Assange was released on bail this week from a jail in Britain, where he is fighting extradition to Sweden over alleged sexual offenses.

Americans spent $942 million online December 17, 61% more than they spent the same day last year, thanks to the more than 1,500 online merchants who participated in Free Shipping Day.

EU leaders outlined a plan for a new fund to fight future crises. Intended to take effect in 2013, the plan will replace the existing 750 billion euro ($998.8 billion) European Financial Stability Facility (EFSF). The meeting failed to create measures to limit borrowing costs which have forced rescues of Greece and Ireland and threaten other high-debt countries on the euro-zone periphery.

QUOTE OF THE WEEK:

“ Congress has voted to extend the Bush tax cuts. Is it me, or is George W. Bush getting more done now than when he was in office?
Jay Leno

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative or named Broker dealer, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

Rockland County
Chestnut Ridge NY

Can the Santa Claus Rally continue? (And year end tax moves) by Ken Mahoney

2010-12-13T11:22:00.000-08:00

Can the Santa Claus Rally continue? (And year end tax moves) by Ken Mahoney

Many economic indicators have shown gradual improvement in recent months, and this seems to be reflected by a growing sense of optimism on Wall Street.
Despite an unusually flat stretch for the markets, stocks gained on Friday and the S&P 500 closed at its highest level since September 2008. Gains came after newly released government data showed a narrowing U.S. trade deficit, thus boosting hopefulness about further economic growth early in 2011. A separate report on consumer sentiment also came in better than expected, helping the Dow lock in a gain of 0.4%, the S&P 500 add 1.3%, and the Nasdaq rise 1.5% for the week.

If things continue as they are, the Dow and S&P 500 are on track to finish 2010 with 10% gains each, while the Nasdaq is up 16% year to date. Alec Young, equity strategist at Standard & Poor's, was quoted by CNN Money on Sunday and said, "The market has been doing pretty well. The recovery continues nice and steady in the U.S. and the market looks like it could go higher if that stays intact." And regarding the economy, John Canally, chief economist at LPL Financial was quoted by MarketWatch as saying, “Long term, the economy has turned the corner.” Hopefully these gentlemen are right, but of course, this paragraph did start with the word “if”. And when it comes to the stock market, few things are certain.

With the holiday shopping season well under way, much attention will be focused on retail sales figures due this Tuesday. Many analysts predict they will confirm a strong start to the post-Thanksgiving shopping season, and since consumer spending represents the single biggest component of U.S. economic growth, positive sales figures bode well for the overall health of the economy.

Also this week, eyes will be turned to Washington for signs a compromise has been reached regarding extending Bush-era tax cuts. The final outcome of the tax debate has been a major source of uncertainty for the markets, and putting the issue to bed is likely to have a stabilizing effect.

Each week, it may seem this commentary introduces new factors that affect the stock market, the economy, and our perception of how well things are going in the world. But regardless of what we report to you, rest assured that our goal is always the same – to educate you and to remain ever alert to the various challenges and opportunities that exist in the framework of working toward your goals. We hope you have a great week!

ECONOMIC CALENDAR:
Tuesday – Producer Price Index, Retail Sales, Business Inventories, FOMC Meeting Announcement
Wednesday – Consumer Price Index, Empire State Manufacturing Survey, Industrial Production
Thursday – Housing Starts, Jobless Claims, Philadelphia Fed Survey
Friday – Leading Indicators

Data as of 12/10/2010 1-Week Y-T-D 1-Year 5-Year 10-Year
Standard & Poor's 500 1.28 11.2 12.5 -0.30 -0.95
Dow 0.25 9.42 9.65 1.17 0.65
NASDAQ 1.78 16.2 20.4 3.37 -0.96
MSCI EAFE 0.38 2.68 3.81 -0.31 0.92
10-year Treasury Note (Yield Only) 3.02 N/A 3.48 4.54 5.34

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. NA means not available.

HEADLINES:

Higher food prices continue to be the main driver of inflation in China, raising the likelihood of an imminent interest rate hike as the country tries to reel in its red-hot economy.

American homes are expected to be worth $1.7 trillion less in 2010 than they were worth last year, according to a report released Thursday by real estate website Zillow. This year's drop in home values is 63% bigger than the $1 trillion dip in 2009, and brings the total value lost since the housing market's peak in 2006 to a whopping $9 trillion.

Sadly, Mark Madoff, the oldest son of convicted swindler Bernard Madoff, committed suicide on Saturday, two years to the day after his father’s arrest.
A powerful, gusty storm dumped mounds of snow across the upper Midwest on Sunday, closing major highways in several states, canceling more than 1,600 flights in Chicago and collapsing the roof of the Minnesota Vikings' stadium.

Credit card offers are surging again after a three-year slowdown, as banks seek to revive a business that brought them huge profits before the financial crisis wrecked the credit scores of so many Americans. HSBC mailed more than 16 million card offers to this group in the third quarter of this year, Citigroup 14 million and Discover 10 million, all roughly tenfold increases over the same period last year, according to Synovate Mail Monitor, a market research firm. Capital One’s rate rose fiftyfold, to 22 million.

Share the Wealth of Knowledge!
Please share this market update with family, friends, or colleagues. If you would like us to add them to our list, simply click on the "Forward email" link below. We love being introduced!.

Insert your broker/dealer disclosures here. i.e. Securities offered through “Your B/D Name Here,” Member FINRA/SIPC.

Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative or named Broker dealer, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

The Markets Split Personality and Year End Tax Savings Solutions by Ken Mahoney

2010-12-06T09:27:00.000-08:00

The Markets Split Personality and Year End Tax Savings Solutions by Ken Mahoney

Does it ever seem to you that news headlines possess a split personality? That everything is always rosy or doom and gloom with no middle ground? This perception scares many people out of investing leading them to conclude that such unpredictability is a risk they can do without. Is this a recent phenomenon?
While it may be obvious that sensational headlines are designed to get an audience’s attention, media influence over public opinion is a long-held tradition. Consider a few headlines from years past:

Can Capitalism Survive? – 1975
Is There Light at the End of the Tunnel? – 1992
Awash in Troubles – 1984

Do any of these headlines sound familiar, even recent? If the years weren’t printed next to them, would you conclude that two of them are over 25 years old? Often, such dire predictions leave something out. In many cases, even as the news is inundated with pessimistic headlines, positive long-term trends are in development.

Just this Sunday, Fed Chairman Ben Bernanke appeared on CBS’ 60 Minutes. Included among his comments were positive statements such as, “I have every confidence that this economy will recover, and recover in a strong and sustained way. The American people are among the most productive in the world. We have the best technologies. We have great universities. We have entrepreneurs. I just have every confidence that as we get through this crisis, that our economy will begin to grow again, and it will remain the most powerful and dynamic economy in the world."

To our point, just an hour after the Fed Chairman’s interview, CNN lead with this headline: Bernanke on '60 Minutes': Grim Outlook. Granted, not everything Bernanke said was positive, but why did CNN choose to highlight the negative? Because sensational headlines sell. Remembering this fact can help you avoid making rash, emotional decisions, and may even help you sleep better at night.

Data as of 12/03/2010 1-Week Y-T-D 1-Year 5-Year 10-Year
Standard & Poor's 500 2.97 9.83 11.4 -0.64 -0.69
Dow 2.62 9.15 9.80 0.93 0.97
NASDAQ 2.24 14.2 19.3 2.80 -0.20
MSCI EAFE 3.68 2.32 0.30 -0.19 1.01
10-year Treasury Note (Yield Only) 2.86 N/A 3.38 4.52 5.51

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. NA means not available.

ECONOMIC CALENDAR:

Tuesday – Consumer Credit
Wednesday – EIA Petroleum Status Report
Thursday – Jobless Claims, EIA Natural Gas Report
Friday – International Trade, Consumer Sentiment, Treasury Budget

HEADLINES:

The U.S. Senate on Saturday defeated two attempts by Democrats to extend the Bush-era tax cuts for the middle class permanently. After the Senate voted, President Barack Obama told Democratic congressional leaders he would be open to a temporary extension of the Bush-era tax cuts for the affluent, but he would demand concessions from the GOP.

The United States has reached a tentative free trade agreement with South Korea, the White House said Friday. The agreement, which must be ratified by Congress, strengthens economic ties between Washington and Seoul at a time when the longtime U.S. ally faces an increasingly hostile northern neighbor. If ratified, the agreement would eliminate tariffs on over 95% of industrial and consumer goods within five years.

A surprising increase in the number of unemployed Americans wasn't enough to stall oil's momentum Friday as it cruised to a 26-month high. Benchmark oil settled up $1.19 at $89.19 a barrel on the New York Mercantile Exchange. It's the second time in less than a month that oil has reached the level where it was in the fall of 2008. There are widespread expectations that the price will hit $90 a barrel by year's end and head toward $100 a barrel by next spring when traders begin looking ahead to the summer driving season.
Nonfarm payrolls rose by 39,000 in November, far lower than the 155,000 gain expected by economists surveyed by MarketWatch and the upwardly revised figure of 172,000 jobs gained in October.

As the end of 2010 approaches we know you are busy with holidays, family, and travel, but it is also a good time to do some last minute tax planning. As a courtesy, we want to provide you with a few eleventh-hour tax tips you may find useful. Although tax planning is rarely fun, these strategies could help you keep more of your hard earned money:

 Vehicles: If you purchased a vehicle in 2010, including a motor home, you can deduct state and local sales taxes and fees. [1]

 Go Green: There is still a tax break available for the purchase or lease of certain hybrid vehicles. [2] In addition, energy-efficient home improvements like insulation qualify for deduction of 30% of the cost, up to $1500 and can be claimed on your 2010 taxes. There is also a renewable-energy credit that lets you deduct expenses for items like geothermal heat pumps, solar panels, and wind-energy systems. (Note: Some of these devices need to be installed this year to earn the credit. [3])

 Accelerated Payments: Paying your mortgage payments into the new year allows for an itemized deduction. You may also want to pay property taxes this year in order to claim the added standard amount on your 2009 return. [4]

 Charitable Donations: If you have stock you would like to donate, you can deduct the full market value and skip paying capital-gains (the charity doesn't pay either). [5] Remember to get a receipt and an acknowledgment from the charity for gifts of $250 or more.

 IRA Contributions and Distributions: You may want to consider IRA withdrawals to pay for education, including that of your grandchildren without owing the 10% penalty. [6] Depending on your income, you may be able to deduct your IRA contribution as well. [7]

 Alternative Minimum Tax (AMT): If your income is above about $75,000 and you have significant write-offs for personal exemptions, state and local income and property taxes or interest on a home equity loan not used to improve a house, you may want to discuss whether you qualify for the AMT with your tax professional. [8]

 Possible Deductions: This is an excellent time of year to get organized. Gathering cash receipts will help you calculate possible deductions and miscellaneous payments. Examples:
• Do you have a hobby or activity that might also qualify as for-profit income? If so, these losses might also be eligible for deduction. 6
• Prepaying college tuition for your children or grandchildren, could allow you to qualify for the American Opportunity Credit, [9] Lifetime Learning credits, or other deductions. [10] Paying ahead for next year's tuition costs could provide a nice write-off this year.
A few extra notes for those of you who are still working:

 401(k): If you are still working, maximize your 401(k) contributions, up to $16,500 or $22,000 if you will be over 50 in 2010.12

 Making Work Pay Credit: In July, you may have noticed an increase in your earned income thanks to this credit. Earned income went up by 6.2%, though certain AGI amounts will affect the amount you can claim. You may have received the credit, but earned too much to be entitled to it. Unless you adjust withholding before the end of the year, you may have to give the money back, either in the form of a smaller tax refund or a higher tax bill next spring.12

 Withholding Adjustments: You may also want to adjust your withholding if you have more than one job, both you and your spouse work, you can be claimed as a dependent, or you have taxes withheld from a pension check.12

 Stimulus Checks: Employed retirees can only keep $150 of their $250 economic-stimulus check. You may want to have money withheld from your check to avoid owing taxes next spring.12

 Flexible Spending Accounts: This time of year is when you probably need to specify how much salary you’ll contribute to your flexible spending accounts. Not only is it appropriate to review your changing needs, but tax-free withdrawals can then be taken from these accounts for medical and dental insurance premiums, uninsured medical and dental expenses, and child-care costs.6 You will forfeit any balance left in these accounts at the end of the year, so take advantage now by filling prescriptions early, making medical or dental appointments, or scheduling elective surgeries.6

Please check with your accountant or tax preparer as the applicability of the above

QUOTE OF THE WEEK:

There are always flowers for those who want to see them. – Henri Matisse

.

Share the Wealth of Knowledge!
Please share this market update with family, friends, or colleagues. If you would like us to add them to our list, simply click on the "Forward email" link below. We love being introduced!.

Insert your broker/dealer disclosures here. i.e. Securities offered through “Your B/D Name Here,” Member FINRA/SIPC.

Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative or named Broker dealer, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

It’s a small world after all… By Ken Mahoney

2010-11-29T08:12:00.000-08:00

It’s a small world after all… By Ken Mahoney

People around the world are arguably more connected now than any other time in history. During the past hundred years, remarkable advances in science, trade, and technology have drawn us closer together. Just 15 years ago, who would have thought we would be able to use our mobile devices to video conference with individuals on the other side of the world? So many things that once seemed impossible have now become everyday occurrences. And yet, this trend toward globalization has also raised significant challenges – some of which we are battling right now.

In recent days, news sources have been commenting on how developments abroad could affect the condition of the U.S. Economy. For example, a FOX News headline from Saturday read: International Crises Threaten to Overshadow Obama's Economic Message , and TIME Magazine online asked Sunday: Will North Korea's Artillery Blast the Global Economy? As these headlines emphasize, the actions of our distant neighbors give many pause for concern. How should we react to such news?

Back in the spring, you may recall that problems in Greece and the so-called PIIGS (Portugal, Ireland, Italy, Greece, Spain) countries caused markets around the world to fall and raised fears of a global double-dip recession. Before long though, the Greek bailout plan and the establishment of a European bailout fund quieted those fears for a time and the markets experienced a nice summer rally. Or you may recall back in March that North Korea sank a South Korean naval vessel, but there was no medium or long-term damage done to either the economy of South Korea, the U.S., or the wider East Asian region. What do these examples teach us?

There will always be bad news to shake up the stock market and rattle investors. And while past performance is no guarantee of future results, declines are historically followed by advances. And, of course, hindsight is always 20/20. When it comes to investing, there are no crystal balls. It is for this reason that we are wise to maintain a long-term approach, stay focused on our objectives, diversify as much as possible, and make adjustments where necessary.

In a way, the words of White House chief spokesman Robert Gibbs on Tuesday capture the essence of the point we are trying to make. Speaking about how the time Obama spends focused on international issues could distract from time spent working on the domestic economy, he said: "there are events that happen like North Korea that you have to address as they happen, not how you would plan for them to happen."
Please rest assured that we are ever alert to the changing world scene, and that we will keep you informed about events that could affect you and adjustments that should be made.

Data as of 11/26/2010 1-Week Y-T-D 1-Year 5-Year 10-Year
Standard & Poor's 500 -0.86 6.66 7.09 -1.24 -1.14
Dow -1.00 6.37 6.00 0.29 0.59
NASDAQ 0.65 11.7 16.5 2.40 -1.27
MSCI EAFE -4.15 -0.71 0.90 -0.51 0.88
10-year Treasury Note (Yield Only) 2.88 N/A 3.45 4.43 5.62

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. NA means not available.

HEADLINES:

Online sellers kick off the week with one of their biggest sales days of the year - Cyber Monday. E-tailers consider it their version of Black Friday. It is the day that Web merchants furiously push big discounts, free gift cards, free shipping and any other gimmick they can think of to entice consumers to spend even more of their holiday shopping dollars online.

ComScore, a digital marketplace research firm, expects online sales for the 2010 holiday season will reach $32.4 billion, marking an 11% increase over the previous year for the combined November-December gift-buying period.

Billionaires Warren Buffett and Bill Gates said Sunday in addition to their enormous philanthropic contributions, they are willing to pay higher U.S. taxes. The pair appeared on ABC's "This Week" to discuss "The Giving Pledge," a program that recruits the wealthy to donate at least half of their wealth to philanthropic causes, which if successful would raise $600 billion. "The rich are always going to say … just give us more money, and we'll go out and spend more, and then it will all trickle down to the rest of you, but that has not worked the last 10 years, and I hope the American public is catching on," Buffett said.

The pound posted its biggest weekly drop against the dollar in more than six months as concern that China is moving to slow its economy and tensions between North and South Korea diminished demand for riskier assets. The pound dropped to $1.5602 as of 4:30 p.m. in London yesterday, a weekly decline of 2.4%. It’s the third weekly decline against the dollar in a row and the biggest since the week ending May 7.

Share the Wealth of Knowledge!
Please share this market update with family, friends, or colleagues. If you would like us to add them to our list, simply click on the "Forward email" link below. We love being introduced!.

Insert your broker/dealer disclosures here. i.e. Securities offered through “Your B/D Name Here,” Member FINRA/SIPC.

Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative or named Broker dealer, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

Goldilocks, where are you? Some country’s economies are too hot, or too cold…by Ken Mahoney

2010-11-15T08:07:00.000-08:00

Goldilocks, where are you? Some country’s economies are too hot, or too cold…

Last week drew attention back to the health of the global economic recovery as the Dow fell 2.2%, the Nasdaq slid 1.5%, and the S&P slumped 1.2%, for their biggest point and percentage drops in three months.

The week’s downturn can be largely attributed to ongoing concern about Europe’s debt crisis, particularly in Ireland, and to the fact that China is considering policies to slow its economic growth in order to counter inflation. Speculation that these new policies will decrease China's demand for natural resources resulted in a decline among materials and energy stocks, as well as crude oil prices.

On the bright side, although these losses end a five-week winning streak, the S&P 500 still closed above its 200-week moving average for the second week in a row – something that has not happened since mid-June 2008.

Also last week, the U.S. government embarked on its second round of quantitative easing (QE2) in response to slow employment growth, global economic concerns, and fears of deflation. On Friday the Federal Reserve purchased $7.3 billion of the $600 billion in securities slated for purchase through June 2011. QE2 is intended to increase the supply of money and lower interest rates in an effort to prompt spending and boost available credit.

Critics contend that the Fed’s plan will increase financial speculation and produce inflation, while its positive impact on average consumers will be limited. To date, commodity prices have soared in response to QE2, with wheat, corn, cotton, sugar and coffee — all broadly used consumer items — listed among the gainers. One concern about this is that any permanent rise in costs for basic goods will be passed on to consumers. Foreign governments, including China, are also concerned about the manipulation of U.S. currency, leading to fears about a drop in foreign Treasury buying. To critics, Fed Chairman Ben Bernanke counters that the Fed's job is to focus on the U.S. economy, not everyone else's.

While the U.S. monitors overseas financial policy, foreign markets watch U.S. economic policy to determine their level of investment. As your financial advisors, we must do something similar when making decisions about what is best for you. As technology and trade increasingly connects our world, it becomes ever more critical for us to remain sensitive to changing global economic issues, as well as current U.S. policies, and to keep you informed about how such factors could affect the health of your investments. This weekly email update is one of the ways we aim to educate you about such matters. We hope you enjoy reading it.

ECONOMIC CALENDAR:

Monday – Retail Sales, Empire State Manufacturing Survey, Business Inventories
Tuesday – Producer Price Index, Treasury International Capital, Industrial Production, Housing Market Index
Wednesday – Consumer Price Index, Housing Starts, EIA Petroleum Status Report
Thursday – Jobless Claims, Leading Indicators, Philadelphia Fed Survey, EIA Natural Gas Report

Data as of 11/12/2010 1-Week Y-T-D 1-Year 5-Year 10-Year
Standard & Poor's 500 -2.17 7.54 10.3 -0.58 -1.22
Dow -2.20 7.33 9.76 0.95 0.56
NASDAQ -2.36 10.9 17.2 2.87 -1.69
MSCI EAFE -2.97 3.18 3.16 0.50 0.83
10-year Treasury Note (Yield Only) 2.54 N/A 3.45 4.56 5.80

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. NA means not available.

HEADLINES:

President Obama has identified another big goal for the upcoming lame duck session of Congress: The pending Strategic Arms Reduction Treaty with Russia. The START treaty, which has been pending in the Senate for months, would reduce the limit on strategic warheads to 1,550 for each country from the current ceiling of 2,200. It also would set up new procedures to allow both countries to inspect each other's arsenals to verify compliance.

Germany is pressing Ireland to seek aid before a Nov. 16 meeting of European finance ministers to calm market volatility and win agreement on making investors help pay for future bailouts, a German government official said Saturday.

Buyers spent over $2 million at an auction of ponzi schemer Bernie Madoff's stuff on Saturday. Ruth Madoff's 10.5-carat diamond engagement ring went for just over half a million, a lot containing those sweet monogrammed slippers went for $6,000, and for some reason a middle-aged man from Long Island paid $1,700 for "a batch of Bernie's unused boxers and socks." He told the Post, "They are brand new so I don't have to buy socks for the next two or three years. I don't really know about the boxers. I just bought it for the socks."

This Thursday is the day when President Obama and the Democratic and Republican leadership on Capitol Hill meet to formally kick off negotiations about possible compromises over the extension of the Bush tax cuts, which are set to expire Dec. 31.

Share the Wealth of Knowledge!
Please share this market update with family, friends, or colleagues. If you would like us to add them to our list, simply click on the "Forward email" link below. We love being introduced!.

Insert your broker/dealer disclosures here. i.e. Securities offered through “Your B/D Name Here,” Member FINRA/SIPC.

Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative or named Broker dealer, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

How will the ‘shift in power’ of congress affect investors? by Ken Mahoney

2010-11-08T08:05:00.000-08:00

How will the ‘shift in power’ of congress affect investors? by Ken Mahoney

Republicans have seized control of the House and increased their presence in the Senate. How will this shift in power affect investors? We can only speculate.

Thankfully, we aren’t completely in the dark when speculating, as history provides some clues. While we cannot possibly discuss the potential impact on every type of investment in this brief commentary, let’s focus on two; stocks and bonds.

STOCKS:
It is commonly held that Republicans are “business friendly”, and thus good for the stock market when they are the controlling party, but there is no solid data to back this up. Additionally, stock returns in years when power is split between the White House and Congress show no clear pattern. Some historical averages however, are interesting to note. Since 1945, the Standard and Poor's 500 index has gained 4% in years when Congress was split between parties, 8% when Congress was controlled by one party but the White House another, and 11% when a single party was in control of Washington.
Also noteworthy though, is an observation made by the Wall Street Journal while commenting on the future of the stock market in light of recent election results: “Watch out for anyone who tells you "divided government is good for the stock market. The historical basis for this – such as data since 1949 via the Stock Trader's Almanac – Is meager. You can't extrapolate universal rules from such a small amount of data.”

BONDS: Two months ago, the GOP issued their 48-page Pledge to America. In it, they laid a plan for trillions in tax cuts, but few intentions to cut spending. Where bonds are concerned, if taxes are cut and deficits rise, the government will likely issue more bonds. The result could be a depression in prices and an undermining of confidence in federal finances. While this scenario wouldn’t be so bad if bonds were already cheap, it is a concern when bond prices are high as they are right now.

One thing is certain – 2011 will be an interesting year. The President’s party no longer has control of Congress. It will be the second year of a slow economic recovery, and one year before the next presidential election. With so many economic and policy issues remaining uncertain, the way politicians handle their responsibilities will be closely scrutinized.

In summary, it is important to remember that when it comes to investing (and politics for that matter), forecasting the future is impossible. At best we can speculate calculatedly. As your financial professionals, it is our job to stay alert to critical changes that could impact your portfolio, and to make necessary adjustments so you can stay on track with your long-term goals. You could say that’s our Pledge to You.

ECONOMIC CALENDAR:
Tuesday – Redbook
Wednesday – International Trade, Jobless Claims, EIA Natural Gas Report, EIA Petroleum Status Report, Treasury Budget
Thursday – U.S. Holiday – Veterans Day
Friday – Consumer Sentiment

Data as of 11/05/2010 1-Week Y-T-D 1-Year 5-Year 10-Year
Standard & Poor's 500 3.60 9.93 14.9 0.09 -1.41
Dow 2.93 9.74 14.4 1.73 0.58
NASDAQ 2.85 13.6 22.5 3.78 -2.53
MSCI EAFE 3.84 5.74 8.16 1.09 0.86
10-year Treasury Note (Yield Only) 2.61 N/A 3.53 4.66 5.80

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. NA means not available.

HEADLINES:
Government-controlled mortgage buyer Fannie Mae is asking for $2.5 billion in additional federal aid after posting a narrower loss in the third quarter. Fannie Mae also said Friday it was likely that the market disarray and suspension of foreclosures due to big lenders' problems with flawed documents will have a negative impact on the delinquency rates of its loans, its expenses and foreclosure timelines.

U.S. securities regulators are close to approving a plan to ensure markets remain liquid even in times of crisis, the chairman of the Securities and Exchange Commission said on Friday. At a meeting to discuss the May "flash crash" that sent the Dow Jones industrial average into a brief 700-point freefall, SEC chief Mary Schapiro and other regulators were zeroing in on new rules to prevent another uncontrollable market plunge.

MSNBC host Keith Olbermann was suspended indefinitely without pay for making political donations in violation of the channel’s policies. “I became aware of Keith’s political contributions late last night,” Phil Griffin, president of MSNBC, said today in an e-mail. “Mindful of NBC News policy and standards, I have suspended him indefinitely without pay.”

Friday’s Labor Department report showed that the United States economy added 151,000 jobs in October. It was certainly a welcome change after four months of job losses but not strong enough to make a dent in unemployment. Nearly 15 million people are still out of work, and the unemployment rate remains at 9.6 percent.

Share the Wealth of Knowledge!
Please share this market update with family, friends, or colleagues. If you would like us to add them to our list, simply click on the "Forward email" link below. We love being introduced!.

Insert your broker/dealer disclosures here. i.e. Securities offered through “Your B/D Name Here,” Member FINRA/SIPC.

Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative or named Broker dealer, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

Earnings, Earnings, Earnings, and Elections

2010-11-01T08:05:00.000-07:00

Earnings, Earnings, Earnings, and Elections
By Ken Mahoney

In real estate, we are taught over and over again it's “location, location, location”. Well for particular stocks, stock sectors and stock markets, it should be “earnings, earnings, earnings”.

While there are a number of factors that may affect the stock market including government policy, interest rates and investor confidence, these factors always impact earnings. And this past earning season seems to have done pretty well.

As we know from history, October can be spooky and we’re not talking just about Halloween. Ironically, it’s been during October that we’ve seen particularly scary stock markets with the October 1929 crash, the October 1987 crash and the October 2008 crash. At this moment however, the stock market has some strength and momentum. There are a number of reasons why the stock market may have momentum now including perhaps another round of quantitative easing, and maybe a more business friendly Congress. And perhaps it's earnings.

Many people don’t understand the disconnect between Wall Street and Main Street, especially while Main Street is still suffering. Daily we hear reports about housing foreclosures and high unemployment. What we don’t pay enough attention to is what is happening overseas - PIIGS (Portugal, Italy, Ireland, Greece, and Spain) saddled with too much debt, economic and social unrest and their attempts to deal with that debt. That story played out very strongly this past summer as the U.S. markets were powerfully impacted by those conditions.

In addition, I don't think enough attention is paid to BRIC (Brazil, Russia, India, and China). These countries are growing. U.S. companies penetrating and selling to those markets are doing very well. According to some reports, S&P 500 companies earn more than 40% of their profits overseas. So, when you scratch your head to try to understand how the stock market is doing well despite our lows here in the U.S., maybe if you look at abroad you can understand why this is all happening and that's because companies are getting their earnings, earnings, earnings from overseas.

October provided another example that the stock market and the economy do not always move in tandem. For the month, the Dow posted its best October since 2006, rising 3%, the S&P advanced 4%, and the Nasdaq leapt 6% . Meanwhile, the government’s initial reading on Gross Domestic Product – the broadest measure of the economy – showed that the current recovery is still one of the weakest in generations.

For three months ending in September, GDP grew at an annual rate of only 2%. During the past 30 years, the average growth rate during a U.S. economic expansion has been 3.6%. During the end of 2009, growth was as strong as 5%. In light of these figures, the past two quarters have been understandably disappointing (2Q growth was 1.7%). What do these numbers mean in plain English? On the bright side, they mean the economy isn’t shrinking; or worse, freefalling, as some naysayers have predicted. They also show that we are moving in the right direction – even a 0.3% increase is worth noting. From another perspective though, the lackluster growth we are seeing is too slow to bring down the unemployment rate, and likely too slow to keep the Federal Reserve from intervening with another round of quantitative easing.

Even as voters hit the polls Tuesday, the Fed’s FOMC (Federal Open Market Committee) is set to convene its 8th meeting of the year. As investors digest election results the following day, economists expect the Fed to announce plans stimulate the economy with another $500 billion to $1 trillion injection.

Also anticipated this week is the government’s closely watched jobs report due Friday. Employers are expected to have added 45,000 jobs in October, and the unemployment rate is projected to hold at 9.6%. Since the jobs report comes out after the Fed’s plans for quantitative easing are announced, investors will surely be analyzing it for signs as to whether QEII was warranted.
Between the election, the Fed’s FOMC meeting announcement, and the jobs report, the first week of November will be a busy one.

ECONOMIC CALENDAR:

Monday – Personal Income and Outlays, ISM Manufacturing Index, Construction Spending
Tuesday – Motor Vehicle Sales
Wednesday – ADP Employment Report, Factory Orders, ISM Non-Manufacturing Index, EIA Petroleum Status Report, FOMC Meeting Announcement
Thursday – BOE Announcement, Jobless Claims, Productivity and Costs, ECB Announcement, EIA Natural Gas Report
Friday – Pending Home Sales Index, Employment Situation, Consumer Credit

Data as of 10/29/2010 1-Week Y-T-D 1-Year 5-Year 10-Year
Standard & Poor's 500 0.02 6.11 10.9 -0.25 -1.42
Dow -0.13 6.62 11.6 1.38 0.50
NASDAQ 1.13 10.5 19.5 4.00 -2.35
MSCI EAFE -0.49 2.25 5.46 0.57 0.75
10-year Treasury Note (Yield Only) 2.56 3.84 3.50 4.57 5.71

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. NA means not available.

HEADLINES:

Monster Worldwide (jobs website operator) reported third-quarter results Thursday that easily topped forecasts, and the company raised its fiscal outlook. During the company's conference call, Monster CEO Sal Iannuzzi said that "while economies still aren't as strong as any of us would like to see them around the world, they are picking up." He added that "the momentum clearly in Europe, United States, North America and Asia is significantly more positive than it was a year ago."

For the school year 2010-11, in-state tuition and fees at public four-year colleges and universities rose to $7,605, up 7.9% from a year ago, the College Board reported Thursday. At private four-year institutions, the average cost rose 4.5% to $27,293.

September’s new-home sales climbed 6.6% from a month earlier to a seasonally
adjusted annual rate of 307,000 the Commerce Department said Wednesday. When compared to a year earlier, the rate tumbled 21.5%. September saw the fourth-worst monthly reading since 1963, though these statistics are notoriously prone to later revisions.

Two packages found on cargo flights from Yemen bound for the U.S. contained explosive material, President Barack Obama said Friday, after U.S. and European authorities went on high alert following the discovery of the parcels. President Obama said authorities had uncovered a “credible terrorist threat.” Both packages were addressed to Jewish organizations in Chicago.

WRCR, Mahoney's Mail bag

2010-10-25T09:24:00.001-07:00

Ken, what do you think about the falling dollar and the rising price of gold?
This is a very sophisticated question. I hear a lot of people saying gold is the currency of the future. Generally, the value of the dollar is lower because you have lower interest rates. When the value of the dollar goes down, the price of gold goes higher as a hedge for a lot of investors and institutions. Conversely, if rates go up, the value of the dollar goes higher and gold would, perhaps, go down because there is an inverse relationship.

It is very cyclical and right now we're going through a rate environment that keeps going down. Sometimes, when there is very low inflation, low interest rates are not enough to maintain the desired level of money supply. The Federal Reserve Bank is expected to implement a concept known as “quantitative easing” which includes the government buying up bonds and still trying to push rates down lower to stimulate the economy and demand.

While gold will go up under those conditions, interest rates will also start going higher, the economy will start to do better and you will, then notice gold start to pull back. One thing to note about gold is that it is not a building material like copper or other metals. Though gold is important – it is used as a way to hedge against currency – it is not used as a significant source in construction unless, of course, you are modeling your bathroom with gold fixtures.

Also, in the last several years gold has dramatically beat stocks and bonds. But, again, this is cyclical because over the last 10, 20, 30 years, stocks and bonds have generally performed better than gold.

Over the past several years gold has become very a popular investment but I would watch out from running with the herd. Again, it works well for awhile and the momentum is with gold right now but again I would caution anyone to try to follow past performance over the last couple years and characterize gold as the definite investment. If anything, a sophisticated investor will opt to pick up an investment that's out of favor and that's important to consider.

As far as whether I see gold as the currency of the future I don't think so. I don't think the currency of the future is gold because you still have other currencies from around the world; you'll still have the Euro, you’ll still have the sterling pound and you'll still have the dollar. With all these different currencies out there I don't think they're going to mold into that of gold.

Finally, and as an aside, I want to comment on the comparison of BRIC (an acronym for the combined economies of Brazil, Russia, India and China) versus PIIGS (an acronym used to refer to the five Eurozone nations – Portugal, Italy, Ireland and Spain). A lot of attention has been paid to PIIGS as all have debt issues and other economic problems in their respective countries. What we don't hear enough about is BRIC where the largest amount of growth is in the world. If you put it together, basically, you have PIIGS versus BRIC - PIIGS and debt bringing down the rest of the world versus BRIC and growth bringing up the rest of the world.

How does currencies, gold, and international trade affect your finances? By Ken Mahoney

2010-10-25T09:13:00.000-07:00

How does currencies, gold, and international trade affect your finances? By Ken Mahoney

What is the G-20? What is a currency war? And what does any of this have to do with my money? If you’ve been asking yourself these questions, you’re not alone. The relationships that exist between global currencies and the officials who control monetary policy have been a regular feature in recent headlines. Why?

Currency values affect international trade. When the value of a nation’s currency is low, it encourages countries with higher valued currency to spend money there because their exports are “cheaper” so to speak. When the value of a nation’s currency is high, its exports become “more expensive”, and nations with lower valued currency are discouraged from purchasing goods and services produced there. While recovering from a global recession that brought high levels of debt and unemployment, it’s no wonder countries would want an advantage when peddling their wares abroad. This scenario explains why there has been a measure of tension between the U.S. and China in recent weeks.

China’s currency (the Yuan) is widely seen as being at least 20% artificially undervalued, which has driven up Chinese exports, but has also amassed a U.S. trade deficit with China of $227 billion in the last year alone. Ripple effects of this trade deficit are being felt throughout the U.S. political system. In Congress, the House of Representatives has already passed a bill that would give the administration power to penalize countries judged to be manipulating their currency values to gain a competitive edge in international trade.

On Saturday, the Group of Twenty (G-20) Finance Ministers and Central Bank Governors met in Gyeongju, South Korea to pursue an end to battles over currencies, with the goal of maintaining trade balances. At this meeting, the world’s currency keepers agreed to "be vigilant against excess volatility and disorderly movement in exchange rates" and China agreed to "move towards more market-determined exchange-rate systems that reflect underlying fundamentals." Although the language is not strong enough to impose strict guidelines on anyone, the G-20 agreed to adopt "indicative guidelines," an intentionally vague phrase that is yet to be clarified.

So how does all of this relate back to the average American investor? First, it is a reminder that taking a global approach to investing is prudent. Because currency values – like many other factors – commonly affect a country’s economic stability, it is better to avoid keeping all your proverbial eggs in one basket. Second, it can help you keep the right perspective when the dollar falls in value. Although a severely undervalued dollar would be bad, a slightly undervalued dollar can invite foreign money into our economy, boost domestic manufacturing, and create jobs.

ECONOMIC CALENDAR:
Monday – Existing Home Sales
Tuesday – Consumer Confidence, S&P Case-Shiller HPI (Home Price Index)
Wednesday – Durable Goods Orders, New Home Sales, EIA Petroleum Status Report
Thursday – Jobless Claims, EIA Natural Gas Report
Friday – GDP, Employment Cost Index, Chicago PMI, Consumer Sentiment

Data as of 10/22/2010 1-Week Y-T-D 1-Year 5-Year 10-Year
Standard & Poor's 500 0.59 6.10 8.25 0.06 -1.53
Dow 0.63 6.76 10.4 1.80 0.89
NASDAQ 0.43 9.27 14.5 3.81 -2.88
MSCI EAFE -0.42 2.72 1.44 1.10 1.03
10-year Treasury Note (Yield Only) 2.58 3.84 3.42 4.39 5.64

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. NA means not available.

HEADLINES:

Since August 27, when Federal Reserve Chairman Ben Bernanke signaled the central bank was likely to pump more dollars into the economy, the greenback’s value has fallen about 4.8% against the currencies of U.S. trading partners (data through October 15). Given the historical behavior of U.S. exports and imports, a sustained move of that magnitude should shrink the U.S. trade deficit by nearly $140 billion over the next two years. That’s the equivalent of an added 0.5 percentage point of economic growth in each year.

The Bureau of Labor Statistics has released data on regional and state unemployment for September. “Twenty-three states and the District of Columbia recorded unemployment rate decreases, 11 states registered rate increases, and 16 states had no rate change", the U.S. Bureau of Labor Statistics said as it compared numbers to August figures.

U.S. Treasury Secretary Timothy Geithner met China's Vice-Premier Wang Qishan on Sunday and "exchanged views" about economic relations between their countries, both sides said.

The simple credit card is on its way toward a makeover. The familiar plastic cards may one day be overtaken by credit-transactions over cell phones. Next month, Citibank will begin testing a card that has two buttons and tiny lights that allow users to choose at the register whether they want to pay with rewards points or credit, at most any merchant they please.

There is more positive news recently; can that hold the Dow over 11,000? by Ken Mahoney

2010-10-18T08:05:00.000-07:00

There is more positive news recently; can that hold the Dow over 11,000? by Ken Mahoney

Fortune magazine showcased a headline on Friday that read, “Who can magically fix the economy?” A picture of a magician pulling a skunk out of Uncle Sam’s hat was comically pictured below. The article went on to read: “There is nothing that the U.S. government or the Federal Reserve or tax cutters can do to make our economic pain vanish overnight. There are no all-powerful, all-knowing superheroes or super villains who can rescue or tank the economy all by themselves.”

Do you agree with the quote above? We do. The simple truth is, no one has a magic wand. Some politicians peacock as if they do. Some analysts would have you think they do. But as a nation, we’ve suffered a huge financial setback. Home values – investment accounts – jobs – all have taken a big hit. It took us a long time to get into this mess, and it will take us a long time to come out of it. Just because the “great recession” technically ended in June of 2009 , doesn’t mean we’ve healed. Despite the best efforts of the Fed, Congress, President Obama, and the famous talking heads, the recovery will take time.

So what’s the good news? We’re headed in the right direction and Americans seem to be sensing that. For the third straight month, retail sales are on the rise nationwide. Shoppers spent more than $367 billion at retailers in September, which reflects a 7.4% year-over-year increase. Because personal consumption expenditures comprise 70% of national output, these healthy percentage gains create a solid base for U.S. Gross Domestic Product (GDP). The level of total U.S. retail sales has now recovered two-thirds of its recessionary peak-to-trough decline from late 2007 through the end of 2008.

In other positive news, since June, the private sector has added an average of 85,000jobs a month. By contrast, the economy lost 8 million jobs in 2008 and 2009.
Speaking on Friday, Federal Reserve Chairman Ben Bernanke said banks are slowly becoming more proactive in seeking out credit-worthy borrowers, and added that he expects a pickup of economic growth next year due to a "somewhat faster pace" of household spending. Tempering his optimism, he did express that economic growth would continue to be "relatively modest" due to persistent high unemployment and dampened consumer demand.

One of Bernanke’s comments is particularly noteworthy in the context of this discussion. "Sustained expansion must ultimately be grown by private demand," he said. So regarding the “magic wand” we mentioned earlier, if anyone has it, it looks like it is the American Public. Hire people – lend money – spend money. Take these actions, and the wheels of capitalism will turn.

ECONOMIC CALENDAR:

Monday – Industrial Production
Tuesday – Housing Starts
Thursday – Jobless Claims, Leading Indicators, Philadelphia Fed Survey
Friday – G20 finance ministers and central bank governors meet in Seoul, South Korea

Data as of 10/15/2010 1-Week Y-T-D 1-Year 5-Year 10-Year
Standard & Poor's 500 0.95 5.48 7.26 -0.17 -1.44
Dow 0.51 6.09 9.94 1.51 0.85
NASDAQ 2.78 8.80 13.6 3.91 -2.56
MSCI EAFE 1.16 3.19 1.80 0.72 0.98
10-year Treasury Note (Yield Only) 2.38 NA 3.47 4.49 5.72

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. NA means not available.

HEADLINES:

President Barack Obama will press Congress to approve $250 stimulus payments to seniors, veterans and the disabled, the White House said Friday amid persistent worries about the US economic recovery. The Social Security Administration earlier announced it would not be making cost of living adjustments to pension payments to seniors for the second year running.

Countrywide's notorious ex-CEO Angelo Mozilo settled with the Securities and Exchange Commission over a civil fraud and insider trading case on Friday. Mozilo agreed to repay $45 million of profit made and another $22.5 million in civil penalties, the SEC said.

U.S. retail sales rose for a third consecutive month in September, posting a stronger-than-expected increase that should fend off fears of a double-dip recession but doesn't signal a strong recovery.

U.S. President Barack Obama on Saturday said he wants to strengthen the labor market by closing tax loopholes that would encourage companies to send jobs overseas. Mr. Obama said he's aiming to replace the tax loopholes with new policies that would allow companies to write off the cost of new equipment, provide tax breaks for clean-energy manufacturing and make the research and experimentation tax credit permanent.
The U.S. government debt is expected to increase by 32% over the next five years if U.S. economic growth stays as slow as it is now, according to the International Monetary Fund.

The Dow Jones is at 11,000, can the momentum continue? by Ken Mahoney

2010-10-11T07:47:00.000-07:00

The Dow Jones is at 11,000, can the momentum continue? by Ken Mahoney

Stocks have gained in five out of the last six weeks, and the Dow Jones Industrial Average closed above 11,000 for the first time in five months Friday.

Bolstering results last week, Friday’s depressed jobs report lifted expectations that the Federal Reserve will soon step in to stimulate the economy yet again, and earnings season kicked off with a bang. Several companies posted profits that beat Wall Street estimates and raised its outlook for the year. In the coming week, 15 S&P companies are set to report, and according to Thompson Reuters, third-quarter year-over-year results are expected to be up 24%. With such strong numbers anticipated this earnings season, many analysts predict that the market will continue to inch higher.

There isn’t much market-moving activity expected in the early part of the week, but Thursday begins a flood of economic data, including the next batch of U.S inflation figures. The Fed said in its last statement that inflation is lower than it would like, and this led many to predict that they will proceed with another round of quantitative easing – likely pulling the trigger at the next policy-setting meeting in November.

Through “quantitative easing”, the Federal Reserve buys up big chunks of government debt with money it creates from nothing – often colloquially described as "printing money”. Some economists insist that with unemployment stuck near 10% and inflation below target, the Fed cannot sit idly by without taking this action. Others remain vocally opposed due to the side effects of additional pressure on the U.S. dollar and a spike in commodity prices. So, will they? Or won't they? Investors will be alert for further signals.

Friday’s retail sales figures will also be in focus as investors try to gauge the appetite of the American consumer. Since consumer spending accounts for over 70% of economic activity, any sign that wallets are open is a welcome one.

ECONOMIC CALENDAR:

Wednesday – Treasury Budget
Thursday – International Trade, Producer Price Index, Jobless Claims
Friday – Consumer Price Index, Retail Sales, Empire State Manufacturing Survey, Consumer Sentiment, Business Inventories, Federal Reserve Chairman Ben Bernanke speaks to the Boston Fed's conference on Revisiting Monetary Policy in a Low Inflation Environment

Data as of 10/08/2010 1-Week Y-T-D 1-Year 5-Year 10-Year
Standard & Poor's 500 1.65 4.49 9.35 -0.51 -1.73
Dow 1.63 5.55 12.5 1.39 0.39
NASDAQ 1.31 5.85 13.0 2.98 -2.85
MSCI EAFE 2.52 1.89 2.75 0.31 0.49
10-year Treasury Note (Yield Only) 2.53 N/A 3.26 4.36 5.82

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized. Sources: Yahoo! Finance, Google Finance, Barron’s, djindexes.com, MSCI Barra. Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. N/A means not available.

HEADLINES:

The federal government ran a deficit of nearly $1.3 trillion in the fiscal year that ended Sept. 30, according to preliminary estimates released Thursday by the Congressional Budget Office. The Treasury Department will deliver the official deficit numbers later this month. According to the CBO, the fiscal year 2010 deficit came in $125 billion below last year – the worst on record since World War II.

President Barack Obama plans to veto a bill whose opponents say would make it harder for homeowners to stop foreclosures. The move marks the Obama administration's most direct intervention so far into a growing debacle tied to how banks foreclose on homes, and the first effective veto of Mr. Obama's presidency. The veto could make it more difficult for banks to complete paperwork and speed the foreclosure process, and could give homeowners more time to rework loans.

U.S. payrolls dropped by 95,000 in September as private employers added 64,000 workers, while governments shed 159,000, half of them temporary Census workers, the Labor Department said Friday. State and local governments shed 83,000 workers. The unemployment rate was unchanged at 9.6%.

The dollar fell against the euro for a fourth week in the longest stretch of losses in almost two years as bigger-than-expected U.S. job cuts spurred speculation that the Federal Reserve will buy more debt.

further information.

Does October have to be ‘spooky’ for the markets? by Ken Mahoney

2010-10-04T07:17:00.000-07:00

Does October have to be ‘spooky’ for the markets? by Ken Mahoney

Thursday marked the end of a quarter and the end of a month. Both turned out to be favorable for equity markets. Although September is historically one of the slowest months of the year, this September wasn’t slow at all. Last week’s slight drop followed four straight weeks of gains that allowed the month to go down as the strongest September since the days of World War II – 1939 to be exact. For the month, the S&P gained 8.8%, the Dow rose 7.72%, and the Nasdaq advanced 12.04%. For the quarter, the S&P gained 10.7%, the Dow added 10.4%, and the Nasdaq rose 12.3%, even as the U.S. economic recovery remained tepid.

A note out of Bespoke last Friday noted that "when the S&P 500 has been positive in September, the index has averaged a gain of 5.51% over the last three months of the year with positive returns 80% of the time...During mid-term elections, the average returns have been even better. When September is an up month during a mid-term election year, the S&P 500 has averaged a 3.5% gain during the month of October and a gain of 11.3% during the 4th quarter." So hopefully no goblins for October ??

Source: cnnmoney.com

Meanwhile, in a report released Friday, the Securities and Exchange Commission and the Commodity Futures Trading Commission said that a large investor – left unidentified – used automated trading software to sell futures contracts called E-minis at a time in the afternoon when the markets were already stressed, and that this action sparked the "flash crash" of May 6. The report indicates that this selloff in the futures market then spilled over into the market for individual stocks. As conditions worsened, the liquidity in the market dissolved because automated systems used by many firms paused when prices began falling severely. The ensuing plummet sent the Dow Jones industrial average down nearly 1,000 points, and briefly erased $1 trillion in market value. It was the largest one-day point drop on record.

The SEC-CFTC report detailed technical factors that led to the market turmoil, but it did not contain any specific policy recommendations that would prevent another flash crash from happening. The report has been submitted to a special advisory committee, which will eventually make recommendations to Congress related to market structure issues and incongruent trading rules across various markets.

Back in May, as an initial response to the crash, the SEC adopted a rule instituting a circuit-breaker “pilot” program for all exchanges to halt or slow down trades of a particular stock if the price moves 10% or more in a five-minute period. In September, the agency expanded the circuit-breaker program to all stocks of the Russell 1000 index as well as 344 specified ETFs. The SEC is expected to use the results of this new report to justify additional measures.
If you’re feeling ambitious, you can read the full 104 page report from the SEC here:
http://www.sec.gov/news/studies/2010/marketevents-report.pdf
Or you can check out the edited summary from MarketWatch here:
http://www.marketwatch.com/story/text-of-flash-crash-reports-summary-2010-10-01
As your financial advisors, we consider it our responsibility to understand factors that have affected, are affecting, or could affect your financial future. We also aim to educate you about such factors so that you can feel comfortable with the recommendations we make. If you ever have questions about this or any other matter, please don’t hesitate to reach out to us. We consider it an honor and a privilege to be good stewards of the assets you have entrusted to our care.

Key things to watch this week:

Monday – Factory Orders,
Tuesday – ISM Non-Manufacturing Index
Thursday – Jobless Claims, Consumer Credit
Friday – Employment Situation

Data as of 10/01/2010 1-Week Y-T-D 1-Year 5-Year 10-Year
Standard & Poor's 500 -0.21 2.79 11.3 -1.34 -2.02
Dow -0.28 3.85 13.9 0.49 0.17
NASDAQ -0.44 4.48 15.2 2.04 -3.55
MSCI EAFE 0.16 -0.82 2.82 -0.64 0.19
10-year Treasury Note (Yield Only) 2.61 N/A 3.19 4.33 5.78

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized. Sources: Yahoo! Finance, Google Finance, Barron’s, djindexes.com, MSCI Barra. Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. N/A means not available.

HEADLINES:
Beijing warned Washington on Thursday that economic ties might be damaged after American lawmakers escalated the conflict over China's currency controls, inching the two economic giants closer to a trade war.
Americans bought cars and trucks last month at the strongest pace since 2009's cash-for-clunkers program, giving Chrysler and Ford sharp increases – a trend that could give the industry and consumers a psychological boost in the year's final quarter, executives and economists said. U.S. auto sales jumped 28.5% in September, helping to lift year-to-date sales 10.3%.
The federal government is looking to raise corporate average fuel economy requirements to something between 47 and 62 miles per gallon by 2025, according to documents released Friday by the National Highway Traffic Safety Administration and the Environmental Protection Agency.
Personal income rose 0.5% in August, the largest increase this year, while spending by individuals remained steady, according to a government report released Friday. Personal income increased $59.3 billion, or 0.5% last month, the Commerce Department said. That's more than the 0.3% rise economists expected.
The dollar fell Friday, hitting a six-month low versus the euro, after a report showing weakness in the U.S. manufacturing sector supported investors who expect the Federal Reserve to resume large-scale bond purchases in coming months to boost the U.S. economy.
.

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Sources:
Marketwatch
The Wall Street Journal Online
Barrons
CNN Money
http://technews.tmcnet.com/topics/associated-press/articles/106097-china-warns-us-currency-bill-might-harm-ties.htm
http://www.freep.com/article/20101002/BUSINESS01/10020307/1322/Automakers-post-solid-Sept.-gains
http://money.cnn.com/2010/10/01/autos/2025_fuel_economy/index.htm
http://money.cnn.com/2010/10/01/news/economy/personal_income_spending/index.htm
http://www.marketwatch.com/story/dollar-weakness-continues-on-fed-fears-2010-10-01

Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative or named Broker dealer, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

The US Markets are now up 4 weeks in a row, Now What? By Ken Mahoney

2010-09-27T09:39:00.000-07:00

The US Markets are now up 4 weeks in a row, Now What? By Ken Mahoney

The recession is over and it ended 15 months ago. Surprised? According to the National Bureau of Economic Research, an independent group of economists, it’s true. In a statement released on Monday, September 20th, the bureau announced that the recession technically ended back in June 2009. As many economists had expected, this official end date makes the most recent downturn the longest and deepest for the U.S. economy since the Great Depression.

So does this mean that everything is back to normal? I think most of us know better than that. According to a new CNN/Opinion Research Corporation poll, 74% of Americans believe the economy is still in a recession. Even the bureau took care to mention that the end of the recession, by definition, is only the period until the economy reaches its low point – not necessarily a return to its previous vitality. They said, “In determining that a trough occurred in June 2009, the committee did not conclude that economic conditions since that month have been favorable or that the economy has returned to operating at normal capacity. Rather, the committee determined only that the recession ended and a recovery began in that month.”

So if the recovery began back in June 2009, why do most Americans think we’re still in a recession? Because to many of them, it feels like it. Often, when referencing events that occur in the economy, the words “official” or “technical” are used. Incidentally, you can find both those words in the first paragraph of this commentary. But as we all know, just because something is “technically” true doesn’t mean it’s practically true. Commenting on this, President Barack Obama said last week, "Obviously, for the millions of people who are still out of work, people who have seen their home values decline, people who are struggling to pay the bills day to day, [the recession is] still very real for them." Whether or not you agree with Mr. Obama’s policies, it is easy to see that this statement has some merit. And as long as Americans feel that we are in a recession, the pace of the recovery will be challenged by lower spending, slower hiring, and the like.

On the bright side, the same CNN/Opinion Research Corporation poll found that the percentage of Americans who say the country is in a recession has dropped 13 points since August – a significant spike in sentiment. The stock market is also looking good for the moment, as Friday closed out the week with a surge that put the Dow Jones Industrial Average on track for its best September in 71 years. Even if the recovery isn’t moving as fast as everyone would like, “slow and steady” seems to be its mantra.

Key things to watch this week:

Tuesday – Consumer Confidence
Thursday – GDP, Jobless Claims, Chicago PMI
Friday – Motor Vehicle Sales, Personal Income and Outlays, Consumer Sentiment, ISM Manufacturing Index, Construction Spending

Data as of 09/24/2010 1-Week Y-T-D 1-Year 5-Year 10-Year
Standard & Poor's 500 2.05 3.01 9.32 -1.10 -2.07
Dow 2.38 4.14 11.9 0.85 0.01
NASDAQ 2.83 4.94 13.0 2.50 -3.74
MSCI EAFE 3.26 -1.02 0.68 -0.25 023
10-year Treasury Note (Yield Only) 2.75 N/A 3.38 4.25 5.83

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized. Sources: Yahoo! Finance, Google Finance, Barron’s, djindexes.com, MSCI Barra. Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. N/A means not available.

HEADLINES:
Silver climbed to its highest price since 1980 last week, as the dollar’s slump boosted demand for precious metals as alternative assets. Gold also climbed to another record, topping $1,300 an ounce.
The economy expanded at a 1.6% annual rate in the second quarter, and will probably finish the current quarter at a 1.4% annual rate, according to estimates by St. Louis forecasting firm Macroeconomic Advisers.

Legislation pressing China to raise the value of its currency is set for a vote in the U.S. House next week, as Republicans joined Democrats in expressing frustration that the Yuan is appreciating too slowly.

Nearly 11% of mortgages modified under the government's Home Affordable Modification Program, known as HAMP, have fallen two months behind in payments, according to a banking regulators' report issued Friday.
In his first comments on Iranian President Mahmoud Ahmadinejad’s statement that the Sept. 11 terrorist attacks may have been orchestrated to bolster the U.S. economy and “save the Zionist regime,” President Barack Obama told BBC Persian that “for him to make a statement like that was inexcusable. It was offensive, it was hateful,” Obama said, according to an excerpt of the interview released by the White House.

QUOTE OF THE WEEK:

“
Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Google Finance is the source for any reference to the performance of an index between two specific periods.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative or named Broker dealer, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

Do we have ‘irrational negativity’ about the US Markets and Economy? By Ken Mahoney

2010-09-20T08:15:00.000-07:00

Do we have ‘irrational negativity’ about the US Markets and Economy? By Ken Mahoney

In his famous "irrational exuberance" speech on December 5, 1996, then Federal Reserve chairman Alan Greenspan posed a rhetorical question: "How do we know when irrational exuberance has unduly escalated asset values, which then become subject to unexpected and prolonged contractions?” With those words, he underscored the influence that emotions can have on financial assets.

Thinking along these lines, it is interesting to note that if there is such a thing as “irrational exuberance”, the opposite must also exist. Let’s call this converse emotion “irrational negativity”. Is there such a thing? The ABC News Consumer Comfort Index is a rolling average based on telephone interviews with 1,000 randomly selected adults over the previous four-week period. Last week, 89% rated the economy negatively, while only 54% rated their own finances negatively. Translation: People think we are worse off than we actually are (irrational negativity).

For the year, the S&P 500 is up 0.94%, the Dow is up 1.72%, and the Nasdaq is up 2.05%. Company earnings are strong, and stocks have moved steadily higher in September thanks to a series of encouraging signals on the economy. Despite this fact, gold set another record last week, and Treasury prices edged higher in a sign that investors remain cautious.

Will people eventually come around? There are reasons to believe they will. One good sign is that Americans are spending more. The U.S. Census Bureau announced Tuesday that consumer spending rose 0.4% from July to August, and 3.6% from 12 months ago, with retail sales up 0.5% and 3.7% respectively. This was the 10th month in a row of year-over-year growth in consumer spending estimates from the Census Bureau, following 14 months of year-over-year declines. All told, Americans spent $363.7 billion at retailers in August – the most since April. Since consumer spending accounts for more than two-thirds of the U.S. economy, this provides yet another silver lining in what many still view as confusing times.

Key things to watch this week:

Monday – Housing Market Index
Tuesday – Housing Starts, FOMC Meeting Announcement
Thursday – Jobless Claims, Existing Home Sales, Leading Indicators
Friday – Durable Goods Orders, New Home Sales

Data as of 09/17/2010 1-Week Y-T-D 1-Year 5-Year 10-Year
Standard & Poor's 500 1.45 0.94 5.64 -1.81 -2.32
Dow 1.39 1.72 8.42 -0.06 -0.29
NASDAQ 3.26 2.05 8.88 1.44 -3.96
MSCI EAFE 1.55 -2.98 -2.40 0.72 -0.19
10-year Treasury Note (Yield Only) 2.80 N/A 3.40 4.26 5.83

Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized. Sources: Yahoo! Finance, Google Finance, Barron’s, djindexes.com, MSCI Barra. Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. N/A means not available.

HEADLINES:

President Obama named Harvard law professor Elizabeth Warren a special adviser Friday and tasked her with setting up an agency to look out for consumers in their dealings with banks, mortgage companies and other financial institutions. Calling Warren "one of the country's fiercest advocates for the middle class," Obama said she would ensure the Consumer Financial Protection Bureau ends abusive practices.

Americans' net worth – the value of assets like homes and investments, minus debts like mortgages and credit cards – fell 2.7% last quarter, or $1.5 trillion, the Federal Reserve said Friday. That left net worth at $53.5 trillion – above the bottom hit during the recession ($48.8 trillion in the first quarter of 2009), but below the pre-recession peak of $65.8 trillion.

General Motors announced Friday that it is planning to invest $483 million and add 483 jobs to its engine plant in Spring Hill, Tenn.
The number of people with health insurance in the United States dropped for the first time in 23 years, the U.S. Census Bureau said Thursday. There were 253.6 million people with health insurance in 2009, the latest data available, down from 255.1 million a year earlier.

After months of debate and significant pressure from the White House, the Senate on Thursday passed a $42 billion bill aimed at helping small businesses. The measure is expected to create 500,000 jobs, according to a Senate summary of the bill.

As the tax debate continues, will the market show improvement this fall? By Ken Mahoney

2010-09-13T07:17:00.000-07:00

As the tax debate continues, will the market show improvement this fall? By Ken Mahoney

After taking one giant step back on Tuesday followed by three baby steps forward on Wednesday, Thursday, and Friday, U.S. stocks managed to rise into positive territory for the second straight week. Although September is traditionally the worst performing month of the year for equities, stocks have been on the mend so far as reports on the labor market, manufacturing, and business activity have been better than expected. Recent economic reports are confirming that while the rate of economic recovery has slowed, it's still on a positive trajectory.

The President also agrees with this sentiment as expressed by his words Friday at a nationally televised news conference. "While the economy is growing again...the hole in the recession left was huge and progress has been painfully slow," he said. Over the last week, Obama has rolled out a series of new proposals, including a six-year, $50 billion plan to rehabilitate the nation's transportation infrastructure and provide jobs. He also called for federal income tax rates to return to their pre-Bush levels for the 2-3% of Americans who earn more than $250,000 – a move that will bring in $700 billion to the US treasury, Obama said. Critics argue that while $700 billion is a hefty sum, it is hardly enough to close the fiscal gap, and is likely to do more harm than good as the nation’s highest income earners curtail their spending.

In the week ahead, readings on retail sales, industrial production, jobless claims, and consumer prices should help give direction to the markets. And with November elections fast approaching, politics are also in play. Currently, all three indexes are hovering around what analysts consider to be key levels, and are likely to meet continued resistance until more economic numbers come in positive. At this point, most people accept that the recovery is going to be slower than expected. What they are looking for is further confirmation that it is expanding rather than contracting.

Key things to watch this week:

Monday – Treasury Budget
Tuesday – Retail Sales, Business Inventories
Wednesday – Industrial Production, Empire State Manufacturing Survey
Thursday – Producer Price Index, Jobless Claims, Philadelphia Fed Survey
Friday – Consumer Price Index, Consumer Sentiment

HEADLINES:

The Greek government is planning no new austerity measures as part of efforts to pull the country out of debt and might even exit international supervision earlier than expected, the prime minister said Sunday. George Papandreou said Greece was on track to meet targets for reducing its deficit by nearly 40% this year.

China's major economic indicators picked up in August after slowing for several months, data issued over the weekend show, an unexpected rebound that could help prospects for global growth.

Michael Barr, assistant treasury secretary for financial institutions, and Edward DeMarco, acting director of the Federal Housing Finance Agency will testify on Capitol Hill next week on the future of Fannie Mae and Freddie Mac. Barr and DeMarco will appear before the House Financial Services Subcommittee on Capital Markets on September 15.

Work on the ultimate seal of BP's troubled gulf oil well will begin sooner than expected, officials said Friday. The 'bottom kill' procedure, in which the well is filled with mud and cement, will start this weekend – closing for good the well that spewed 4.9 million barrels of oil into the Gulf of Mexico.

Donald Trump offered Friday to purchase the site of the proposed mosque near Ground Zero in order to end the national controversy. His bid includes $4.8 million, the amount that businessman Hisham Elzanaty paid for the two-building site, plus a 25% premium. But Elzanaty's lawyer, Wolodymyr Starosolsky, blasted the offer as a publicity stunt and told The Post that his client "found this letter somewhat laughable."

The markets are at a crossroad, which turn does it take? By Ken Mahoney

2010-09-07T08:38:00.000-07:00

The markets are at a crossroad, which turn does it take? By Ken Mahoney

Imagine that you are driving to an important destination when you unexpectedly reach a crossroad. As you consult your map and look to the street signs for direction, you notice there is a conflict. Your map indicates that you should turn left, but the signs indicate that you should turn right. Which is the proper course to take?

In many ways, this scenario illustrates the challenge facing investors today. There are signs pointing in the direction of a deteriorating economy, and there are signs pointing in the direction of a stabilizing and steadily growing economy.

To make matters even more complicated, the signs seem to change every week. Good news – bad news. Bad news – good news. The result is that many people are nervously holding onto their cash. According to Schaeffer's Investment Research, Americans are currently sitting on $9.4 trillion in cash, which is 27% more than in 2007. This, in turn, contributes toward low trading volume and increased volatility in the stock market, which further scares investors away. In a way, it is a self-perpetuating cycle. So what happened last week?

Good news: The Labor department reported that hiring is picking up. Businesses added 67,000 jobs to their payrolls in August, marking the eighth straight month of job growth, following nearly two straight years of job losses. Nonfarm payrolls only fell by 54,000 last month, roughly half the decline that had been feared. Unfortunately, the unemployment rate rose from 9.5% to 9.6% because the number of job seekers was still greater than the number of job openings. So while this report shows that things are headed in the right direction, it also shows that the labor market is still soft.

More Good news: The ISM (Institute for Supply Management) manufacturing index hit 56.3 in August, up from July and significantly ahead of expectations. Any reading above 50 is considered a sign of growth, while a drop below 41.2 is associated with a recession in the broader economy. Good news also came out of the housing sector as marked by an unexpected increase in pending sales of used homes.

How did this dose of positive economic news affect the stock market? The Dow kicked off September with its best three days at the start of a month since March 2009, and its best pre Labor Day week since 1990. Echoing how many investors feel, Phil Orlando, an equity strategist at Federated Investors was interviewed by MarketWatch on Friday and quoted as saying, “In the last two weeks or so, things have been starting to firm up, and today's jobs numbers really put an exclamation mark on that. We're feeling a lot more comfortable about our view, than those thinking about a double dip. If you had a bearish bent in the middle of August when you went on vacation, the story seems different today – it seems constructive."

Little economic news is anticipated in the holiday shortened week ahead, and trading volume is expected to remain light as vacationers return home from their travels. Eyes will undoubtedly be fixed on the President Wednesday as he outlines his administration’s plans to spark the economy. Let’s hope the upcoming “street signs” offer clear direction.

HEADLINES:

According to a CNN/Opinion Research Corporation survey released Sunday, 81% of the public rated the country's economic conditions as poor, with 18% describing the economy as good. 44% of people questioned described economic conditions as very poor, up seven points from July.

President Obama is scheduled to lay out a new plan for the economy this Wednesday. Administration officials previously told CNN that the president is considering a payroll tax holiday as well as new infrastructure spending, among several proposals his economic team has been weighing.

According to Schaeffer's Investment Research, the Dow is on pace to register 90 days this year with swings of 100 points or more – more than twice as many as in any of the three years leading up to the crash.

Burger King said Thursday that it has agreed to be acquired by investment firm 3G Capital in a deal valued at $4 billion. The New York-based firm will buy the fast food chain for $24 a share. That marks a 46% premium over Burger King's closing price of $16.45 on Tuesday, the day before news reports said the company was up for sale.

The nation's top automakers reported disappointing sales Wednesday, resulting in the worst August for industry wide auto sales in 27 years. According to sales tracker Autodata, U.S. new vehicle sales fell just short of 1 million vehicles, a drop of 21% from a year ago.