This quarterly newsletter provides an overview of the first quarter of 2011 for markets and asset class performance. While markets experienced volatility due to events in North Africa, the Middle East, and Japan, most asset classes ended the quarter with positive returns. Specifically, US large companies returned 5.92%, US small companies returned 7.94%, international large companies returned 2.67%, international small companies returned 4.34%, real estate returned 7.5%, and commodities returned 4.45%. US bonds returned 0.42% while international bonds returned -0.77%. The recovery from the 2008 financial crisis appears to be continuing despite ongoing challenges in Europe.
The document provides an overview of the Bush-era tax cuts that are scheduled to expire at the end of 2012. It discusses:
1) The major tax cuts implemented in 2001 and 2003, including reductions in individual income tax rates, increases in tax credits, and reductions in estate taxes.
2) That these tax cuts were intended to be temporary and would expire at the end of 2010 unless extended by Congress.
3) That Congress passed legislation in 2010 to extend certain provisions, such as lower capital gains and dividend tax rates, for two additional years through 2012.
4) An explanation that if these tax cuts are allowed to expire as scheduled at the end of 2012, individual tax rates and other taxes
The document discusses the state of the U.S. economy and interest rate outlook in August 2011. It notes that greater uncertainty threatens economic expansion due to inflation hurting demand, supply chain issues from Japan, and weak confidence from unemployment and fiscal policy issues. Key risks include financial market volatility and unfavorable fiscal situations in Europe and the Middle East. Continued government support and contained oil prices are key to maintaining the expansion. Housing and employment remain weak areas and the federal budget committee must address deficit issues.
The document discusses the Federal Reserve's focus on boosting corporate profits during the recent economic slowdown. The Fed has been contacting analysts weekly to get updates on plunging earnings. It is concerned that falling profits could trigger further cuts to business investment and hiring, tipping the economy into recession. By aggressively cutting interest rates, the Fed is betting it can support profits without igniting inflation. However, some see risks in this strategy if companies raise prices to boost margins, potentially leading to stagflation. Bond investors in particular are worried the Fed is ignoring inflation risks in its drive to prop up corporate earnings.
- The document summarizes market developments in November 2012 and year-to-date. It discusses the US presidential election, housing market momentum, and uncertainty around resolving the US fiscal cliff.
- Major world markets showed resilience despite issues like Hurricane Sandy and the fiscal cliff negotiations. Companies attracted investors with strong earnings and balance sheets.
- The resource-heavy Canadian S&P/TSX Composite trailed other markets. Gold-related stocks in particular pulled back, weighing on the Materials and Energy sectors.
- Bond markets offered less volatility than equities but low yields meant little return beyond historically low levels. Uncertainty around resolving the fiscal cliff increased volatility into the end of the year.
Monthly Investment Commentary December 2010ll19046
The document provides a monthly investment commentary for December 2010. It summarizes major market developments in November, including volatility in capital markets in response to renewed concerns over European debt, Chinese monetary policy, and tensions between North and South Korea. The S&P/TSX Composite index gained 2.2% for the month while other markets were flat or negative. Commodity prices like gold and oil increased. The document also notes General Motors' return to the stock market through a large IPO and introduces an upcoming change to London Capital Management and its parent company.
The faculty meeting celebrated accomplishments from the 2011-2012 academic year and reviewed strategic planning for the future. The meeting agenda included discussing where the Harrington School is currently, visions for the future, and how to achieve that vision. The vision is for the Harrington School to be a distinctive and nationally-recognized program that prepares graduates for citizenship, careers, and life in a changing global economy. The school's mission is to use communication and digital media to make a difference through building interdisciplinary programs, making real-world learning integral, and increasing flexibility and reach of the program.
The document provides an overview of the Bush-era tax cuts that are scheduled to expire at the end of 2012. It discusses:
1) The major tax cuts implemented in 2001 and 2003, including reductions in individual income tax rates, increases in tax credits, and reductions in estate taxes.
2) That these tax cuts were intended to be temporary and would expire at the end of 2010 unless extended by Congress.
3) That Congress passed legislation in 2010 to extend certain provisions, such as lower capital gains and dividend tax rates, for two additional years through 2012.
4) An explanation that if these tax cuts are allowed to expire as scheduled at the end of 2012, individual tax rates and other taxes
The document discusses the state of the U.S. economy and interest rate outlook in August 2011. It notes that greater uncertainty threatens economic expansion due to inflation hurting demand, supply chain issues from Japan, and weak confidence from unemployment and fiscal policy issues. Key risks include financial market volatility and unfavorable fiscal situations in Europe and the Middle East. Continued government support and contained oil prices are key to maintaining the expansion. Housing and employment remain weak areas and the federal budget committee must address deficit issues.
The document discusses the Federal Reserve's focus on boosting corporate profits during the recent economic slowdown. The Fed has been contacting analysts weekly to get updates on plunging earnings. It is concerned that falling profits could trigger further cuts to business investment and hiring, tipping the economy into recession. By aggressively cutting interest rates, the Fed is betting it can support profits without igniting inflation. However, some see risks in this strategy if companies raise prices to boost margins, potentially leading to stagflation. Bond investors in particular are worried the Fed is ignoring inflation risks in its drive to prop up corporate earnings.
- The document summarizes market developments in November 2012 and year-to-date. It discusses the US presidential election, housing market momentum, and uncertainty around resolving the US fiscal cliff.
- Major world markets showed resilience despite issues like Hurricane Sandy and the fiscal cliff negotiations. Companies attracted investors with strong earnings and balance sheets.
- The resource-heavy Canadian S&P/TSX Composite trailed other markets. Gold-related stocks in particular pulled back, weighing on the Materials and Energy sectors.
- Bond markets offered less volatility than equities but low yields meant little return beyond historically low levels. Uncertainty around resolving the fiscal cliff increased volatility into the end of the year.
Monthly Investment Commentary December 2010ll19046
The document provides a monthly investment commentary for December 2010. It summarizes major market developments in November, including volatility in capital markets in response to renewed concerns over European debt, Chinese monetary policy, and tensions between North and South Korea. The S&P/TSX Composite index gained 2.2% for the month while other markets were flat or negative. Commodity prices like gold and oil increased. The document also notes General Motors' return to the stock market through a large IPO and introduces an upcoming change to London Capital Management and its parent company.
The faculty meeting celebrated accomplishments from the 2011-2012 academic year and reviewed strategic planning for the future. The meeting agenda included discussing where the Harrington School is currently, visions for the future, and how to achieve that vision. The vision is for the Harrington School to be a distinctive and nationally-recognized program that prepares graduates for citizenship, careers, and life in a changing global economy. The school's mission is to use communication and digital media to make a difference through building interdisciplinary programs, making real-world learning integral, and increasing flexibility and reach of the program.
The newsletter summarizes the top 10 estate planning mistakes. Specifically, it discusses mistakes #5 and #6 from the list. Mistake #5 is giving beneficiaries a percentage of the estate rather than a specific dollar amount, as percentages can lead to disputes over valuation and costs. Mistake #6 is giving one child control over another as trustee, as this can cause disputes even in good families by excluding one child from decision making. The article recommends naming an impartial third party such as a financial institution as trustee instead of a family member beneficiary.
The document provides a quarterly newsletter for clients of FJY Financial. It discusses the performance of various asset classes in Q3 2012, noting that US and international stocks gained 6-7% despite concerns in the markets. It introduces new associate advisor Ginnie Baker and outlines her background and role at FJY. It also summarizes FJY's recent educational events and conferences attended to enhance their knowledge and client services.
The document provides annual performance data for various asset classes and indexes in 2010. U.S. small equities (Russell 2000 Index) performed best, returning 26.85%, while international fixed income (JP Morgan GBI ex-US Index) returned the least at 3.44%. Other top performers were real estate investment trusts (REITs) at 27.95% and commodities/natural resources at 16.83%.
The quarterly newsletter discusses the gloomy third quarter of 2011 for investment markets. Major stock market indexes like the S&P 500 and Russell 2000 experienced double-digit percentage declines. International markets also suffered, with the EAFE index falling 19.6%. Nearly all asset classes had negative returns for the quarter. The debt ceiling debate and uncertainty in Europe weighed on investor sentiment, leading to persistent selling through the summer.
This document introduces Aisha Al Sakkar and shares that she enjoys makeup, travel, seeing and listening to things. Her favorite food and color are not specified, but she loves children and spending time with her family. She thanks the reader for their attention and invites any questions.
Presentació del treball de les comissions de l'AMPA durant el 2015. Resum de la feina feta. Elaborada per a l'Assemblea General de Socis celebrada el 17 de febrer de 2016
This document provides information about Altair Advisers LLC, an independent investment advisory firm. It lists details about the firm such as its founding date, ownership structure, client retention rate, assets under management, compensation methods, and minimum requirements for clients. It also provides biographies of the firm's principals and directors who have received various industry recognitions. The document appears to be marketing or informational material for prospective clients of Altair Advisers.
The article discusses negative real yields on short-term Treasury securities since October 2010. Real yields are nominal yields adjusted for inflation, and have been negative in most months since 2010 as inflation has exceeded nominal interest rates. Investors have faced losing wealth in real terms by earning almost nothing on cash balances due to the Federal Reserve cutting interest rates to near zero since 2008 to spur economic recovery. Some investors have shifted portfolios to money market funds and cash to avoid stock market volatility, but this risks eroding purchasing power as no one can consistently time markets.
The document provides John Leslie's market analysis for April 2011. It discusses the positive trends in the US economy and markets, including improvements in employment, manufacturing, and consumer confidence. It also notes lingering issues in housing. The analysis presents both bullish and bearish perspectives on the market outlook. Technical indicators profile sector performance and point to bullish trends in energy, industrials, and materials. Fixed income and commodities relationships are also examined.
- The US stock market declined in May amid concerns over rising interest rates and inflation. The S&P 500 and Nasdaq fell nearly 3% and 6% respectively.
- Economic data was mixed, with GDP growth revised up but consumer confidence falling. Unemployment remained low while manufacturing grew unexpectedly.
- Housing sales declined slightly in April but prices rose over 4% year-over-year, suggesting a soft landing for the housing market so far.
- Corporate profits were solid, with the majority of S&P 500 companies reporting earnings above analyst estimates led by energy firms.
- Major equity markets dropped in August due to concerns about the pace of the global economic recovery. Bond markets and gold prices rose as investors sought safer assets.
- While the US and global economies are growing, the recovery is slower than expected. Unemployment remains high in the US and the housing market is still weak.
- Canada's economy is performing better than the US due to stronger commodity demand and fiscal position. However, growth may slow as the housing and consumer spending boom recedes.
This quarterly newsletter provides an overview of recent market volatility and macroeconomic concerns. It notes that insider buying was high during recent market declines, which may indicate hidden value in some companies. The newsletter recommends focusing on high-yielding securities and considering insider information when investing. It also emphasizes the importance of keeping investments simple and understanding the risks and costs.
1) The newsletter discusses maintaining a positive attitude and analytical thinking when making investment decisions. Using intuition can lead to regretted decisions.
2) A survey of the company's clients found high levels of satisfaction, trust, and comfort with portfolio risk. Clients requested additional services like estate planning.
3) The document provides an investment update, including stock and ETF recommendations, and current economic and market conditions.
Weekly Economic Update For The Week Of March 7, 2011tjsulli1
The document provides a weekly economic update from DSA Financial Group. It summarizes recent economic data reports including a better-than-expected jobs report showing 192,000 new jobs added in February and the unemployment rate falling to 8.9%. Service and manufacturing sectors continued expanding in February according to new surveys. Commodity prices such as gold, oil, and silver increased last week. Despite volatility, major stock indexes posted weekly gains.
The portfolio manager provides two key lessons from recent events including the earthquake in Japan: 1) Expect the unexpected and build strict risk controls like diversification into portfolios to limit damage from unforeseen events. 2) Avoid overconfidence which can lead to taking large concentrated bets and ignoring potential risks, as demonstrated by investors who heavily weighted Nortel and Canadian assets. The manager then discusses their approach to portfolio construction which focuses on risk management through identifying an appropriate target mix, diversifying across companies and sectors, and having disciplined selling processes.
- In August, Wall Street experienced its worst liquidity crunch in nearly ten years due to accelerating mortgage defaults and fears of a recession. A sharp rise in mortgage defaults undermined mortgage-backed securities and highly leveraged funds.
- The Dow lost 796 points (nearly 6%) in five trading days through August 15th. The S&P 500 and other indexes also declined sharply.
- On August 17th, the Federal Reserve unexpectedly cut interest rates by 0.5% to help alleviate risks, buoying markets for the rest of the month.
Global equity markets rallied in August despite ongoing economic concerns. Hopes grew for policy action to rescue fragile economies and boost confidence, with the US Federal Reserve and central banks in China and Europe announcing stimulus packages. As a result, major markets posted gains for the month, led by the US S&P 500 index with double-digit year-to-date returns. Commodity prices and the Canadian market rebounded from declines earlier in the year on signs of improved global growth prospects from the stimulus measures.
This document discusses managing globally and international business. It covers key topics like the characteristics of the global economy, strategies used in international operations ranging from exporting to alliances, assessing political risk, and the goals of major trade agreements between countries and regions. Cultural differences between countries like the US and Japan are also examined, especially in areas like employment, decision-making, and relationships with employees.
- After positive returns in the first three quarters of 2011, global markets saw negative returns in the second quarter due to normal volatility, though prospects for economic recession remain remote.
- While economic growth has slowed globally, it is still positive and temporary factors like disruptions from Japan's disasters and commodity price rises have contributed; leading indicators remain positive.
- European sovereign debt issues continue regarding some countries' debt levels and management, but efforts to address problems have been taken and debt is still seen as manageable.
- Outlook remains positive for continued growth in the second half of 2011 and beyond, though expect continued short-term market volatility; long-term discipline and diversification are recommended.
Warren Buffett, Larry Fink, Bill Gross, and Jeremy Siegel all see opportunities in U.S. stocks despite concerns about the global economy. They note that corporations have strong cash flows and dividends provide greater safety than bonds given low interest rates. The portfolio manager has tilted client portfolios toward high-quality, dividend paying stocks and believes these stocks still have potential despite recent market volatility.
- Major stock markets started 2011 positively, continuing the rally from late 2010, as improving economic data boosted investor confidence.
- Investors shifted funds out of bonds and into riskier assets like equities and commodities, showing reduced risk aversion.
- Commodity prices rose due to stronger global growth, helping energy stocks, while materials stocks lagged.
- While the economic outlook remains positive overall, inflation concerns in emerging markets and potential market corrections pose risks.
- Major stock markets started 2011 positively, continuing the rally from late 2010, as improving economic data boosted investor confidence.
- Investors favored riskier assets like equities and commodities over traditional safe havens like bonds. Commodity prices rose on strong global growth.
- Canadian and US stock markets rose in January, led by energy sector gains. European markets also rose on positive economic news from Germany.
- Inflation concerns emerged in some emerging markets like China and India, weighing on their stock markets. Geopolitical risks also contributed to volatility.
- While economic fundamentals remain positive, markets may be due for a pause given extended gains, and confidence can remain fragile. Diversification remains important
The newsletter summarizes the top 10 estate planning mistakes. Specifically, it discusses mistakes #5 and #6 from the list. Mistake #5 is giving beneficiaries a percentage of the estate rather than a specific dollar amount, as percentages can lead to disputes over valuation and costs. Mistake #6 is giving one child control over another as trustee, as this can cause disputes even in good families by excluding one child from decision making. The article recommends naming an impartial third party such as a financial institution as trustee instead of a family member beneficiary.
The document provides a quarterly newsletter for clients of FJY Financial. It discusses the performance of various asset classes in Q3 2012, noting that US and international stocks gained 6-7% despite concerns in the markets. It introduces new associate advisor Ginnie Baker and outlines her background and role at FJY. It also summarizes FJY's recent educational events and conferences attended to enhance their knowledge and client services.
The document provides annual performance data for various asset classes and indexes in 2010. U.S. small equities (Russell 2000 Index) performed best, returning 26.85%, while international fixed income (JP Morgan GBI ex-US Index) returned the least at 3.44%. Other top performers were real estate investment trusts (REITs) at 27.95% and commodities/natural resources at 16.83%.
The quarterly newsletter discusses the gloomy third quarter of 2011 for investment markets. Major stock market indexes like the S&P 500 and Russell 2000 experienced double-digit percentage declines. International markets also suffered, with the EAFE index falling 19.6%. Nearly all asset classes had negative returns for the quarter. The debt ceiling debate and uncertainty in Europe weighed on investor sentiment, leading to persistent selling through the summer.
This document introduces Aisha Al Sakkar and shares that she enjoys makeup, travel, seeing and listening to things. Her favorite food and color are not specified, but she loves children and spending time with her family. She thanks the reader for their attention and invites any questions.
Presentació del treball de les comissions de l'AMPA durant el 2015. Resum de la feina feta. Elaborada per a l'Assemblea General de Socis celebrada el 17 de febrer de 2016
This document provides information about Altair Advisers LLC, an independent investment advisory firm. It lists details about the firm such as its founding date, ownership structure, client retention rate, assets under management, compensation methods, and minimum requirements for clients. It also provides biographies of the firm's principals and directors who have received various industry recognitions. The document appears to be marketing or informational material for prospective clients of Altair Advisers.
The article discusses negative real yields on short-term Treasury securities since October 2010. Real yields are nominal yields adjusted for inflation, and have been negative in most months since 2010 as inflation has exceeded nominal interest rates. Investors have faced losing wealth in real terms by earning almost nothing on cash balances due to the Federal Reserve cutting interest rates to near zero since 2008 to spur economic recovery. Some investors have shifted portfolios to money market funds and cash to avoid stock market volatility, but this risks eroding purchasing power as no one can consistently time markets.
The document provides John Leslie's market analysis for April 2011. It discusses the positive trends in the US economy and markets, including improvements in employment, manufacturing, and consumer confidence. It also notes lingering issues in housing. The analysis presents both bullish and bearish perspectives on the market outlook. Technical indicators profile sector performance and point to bullish trends in energy, industrials, and materials. Fixed income and commodities relationships are also examined.
- The US stock market declined in May amid concerns over rising interest rates and inflation. The S&P 500 and Nasdaq fell nearly 3% and 6% respectively.
- Economic data was mixed, with GDP growth revised up but consumer confidence falling. Unemployment remained low while manufacturing grew unexpectedly.
- Housing sales declined slightly in April but prices rose over 4% year-over-year, suggesting a soft landing for the housing market so far.
- Corporate profits were solid, with the majority of S&P 500 companies reporting earnings above analyst estimates led by energy firms.
- Major equity markets dropped in August due to concerns about the pace of the global economic recovery. Bond markets and gold prices rose as investors sought safer assets.
- While the US and global economies are growing, the recovery is slower than expected. Unemployment remains high in the US and the housing market is still weak.
- Canada's economy is performing better than the US due to stronger commodity demand and fiscal position. However, growth may slow as the housing and consumer spending boom recedes.
This quarterly newsletter provides an overview of recent market volatility and macroeconomic concerns. It notes that insider buying was high during recent market declines, which may indicate hidden value in some companies. The newsletter recommends focusing on high-yielding securities and considering insider information when investing. It also emphasizes the importance of keeping investments simple and understanding the risks and costs.
1) The newsletter discusses maintaining a positive attitude and analytical thinking when making investment decisions. Using intuition can lead to regretted decisions.
2) A survey of the company's clients found high levels of satisfaction, trust, and comfort with portfolio risk. Clients requested additional services like estate planning.
3) The document provides an investment update, including stock and ETF recommendations, and current economic and market conditions.
Weekly Economic Update For The Week Of March 7, 2011tjsulli1
The document provides a weekly economic update from DSA Financial Group. It summarizes recent economic data reports including a better-than-expected jobs report showing 192,000 new jobs added in February and the unemployment rate falling to 8.9%. Service and manufacturing sectors continued expanding in February according to new surveys. Commodity prices such as gold, oil, and silver increased last week. Despite volatility, major stock indexes posted weekly gains.
The portfolio manager provides two key lessons from recent events including the earthquake in Japan: 1) Expect the unexpected and build strict risk controls like diversification into portfolios to limit damage from unforeseen events. 2) Avoid overconfidence which can lead to taking large concentrated bets and ignoring potential risks, as demonstrated by investors who heavily weighted Nortel and Canadian assets. The manager then discusses their approach to portfolio construction which focuses on risk management through identifying an appropriate target mix, diversifying across companies and sectors, and having disciplined selling processes.
- In August, Wall Street experienced its worst liquidity crunch in nearly ten years due to accelerating mortgage defaults and fears of a recession. A sharp rise in mortgage defaults undermined mortgage-backed securities and highly leveraged funds.
- The Dow lost 796 points (nearly 6%) in five trading days through August 15th. The S&P 500 and other indexes also declined sharply.
- On August 17th, the Federal Reserve unexpectedly cut interest rates by 0.5% to help alleviate risks, buoying markets for the rest of the month.
Global equity markets rallied in August despite ongoing economic concerns. Hopes grew for policy action to rescue fragile economies and boost confidence, with the US Federal Reserve and central banks in China and Europe announcing stimulus packages. As a result, major markets posted gains for the month, led by the US S&P 500 index with double-digit year-to-date returns. Commodity prices and the Canadian market rebounded from declines earlier in the year on signs of improved global growth prospects from the stimulus measures.
This document discusses managing globally and international business. It covers key topics like the characteristics of the global economy, strategies used in international operations ranging from exporting to alliances, assessing political risk, and the goals of major trade agreements between countries and regions. Cultural differences between countries like the US and Japan are also examined, especially in areas like employment, decision-making, and relationships with employees.
- After positive returns in the first three quarters of 2011, global markets saw negative returns in the second quarter due to normal volatility, though prospects for economic recession remain remote.
- While economic growth has slowed globally, it is still positive and temporary factors like disruptions from Japan's disasters and commodity price rises have contributed; leading indicators remain positive.
- European sovereign debt issues continue regarding some countries' debt levels and management, but efforts to address problems have been taken and debt is still seen as manageable.
- Outlook remains positive for continued growth in the second half of 2011 and beyond, though expect continued short-term market volatility; long-term discipline and diversification are recommended.
Warren Buffett, Larry Fink, Bill Gross, and Jeremy Siegel all see opportunities in U.S. stocks despite concerns about the global economy. They note that corporations have strong cash flows and dividends provide greater safety than bonds given low interest rates. The portfolio manager has tilted client portfolios toward high-quality, dividend paying stocks and believes these stocks still have potential despite recent market volatility.
- Major stock markets started 2011 positively, continuing the rally from late 2010, as improving economic data boosted investor confidence.
- Investors shifted funds out of bonds and into riskier assets like equities and commodities, showing reduced risk aversion.
- Commodity prices rose due to stronger global growth, helping energy stocks, while materials stocks lagged.
- While the economic outlook remains positive overall, inflation concerns in emerging markets and potential market corrections pose risks.
- Major stock markets started 2011 positively, continuing the rally from late 2010, as improving economic data boosted investor confidence.
- Investors favored riskier assets like equities and commodities over traditional safe havens like bonds. Commodity prices rose on strong global growth.
- Canadian and US stock markets rose in January, led by energy sector gains. European markets also rose on positive economic news from Germany.
- Inflation concerns emerged in some emerging markets like China and India, weighing on their stock markets. Geopolitical risks also contributed to volatility.
- While economic fundamentals remain positive, markets may be due for a pause given extended gains, and confidence can remain fragile. Diversification remains important
This document summarizes the current US economic outlook. It notes some positive indicators like improving manufacturing and corporate earnings numbers, but also highlights ongoing challenges. Specifically:
1) While manufacturing and mergers & acquisitions are up, hiring remains slow and unemployment high at 8.8%.
2) The housing market continues to struggle with foreclosures expected to rise again, further depressing home prices.
3) Overall the recovery is sluggish and dependent on improved consumer confidence, which remains weak due to high gas prices, slow wage growth, and concerns about job security.
Global equity markets rose in February as investors gained confidence in the U.S. economic recovery and progress was made in resolving Greece's debt crisis. The Canadian market also saw gains, though the materials sector struggled due to rising costs for gold producers. Higher oil prices boosted energy stocks in Canada and posed risks to recovering economies and export competitiveness. Looking ahead, continued issues in Europe and volatility in oil prices may lead to increased short-term market fluctuations.
- Stocks fell sharply in the first quarter of 2009, with double-digit losses across most asset classes, though high-yield bonds gained slightly. The fund portfolios outperformed their benchmarks due to strong performance from fixed income managers and tactical equity allocations.
- The economic downturn was caused by a self-reinforcing cycle of debt, falling asset prices, and lower spending/profits, which has reversed the long trend of rising debt fueling growth. Breaking this debt-deflation spiral will be difficult.
- The outlook incorporates scenarios ranging from a quick recovery to a severe prolonged recession, and positions portfolios accordingly with a focus on compelling long-term opportunities from active managers, high-yield bonds
1. Volume 5, Number 2
Quarterly Newsletter April 2011
QUARTER IN REVIEW turmoil arising in North Africa and the
Middle East. The markets were further ASSET CLASS PERFORMANCE: Q1 2011
By: Jon P. Yankee, MBA, CFP ® &
tested by Japan’s most devastating
Thomas N. Saunders, Jr.
earthquake and the resulting tsunami
and nuclear crisis. Despite this mid-
Market Volatility Leads To Favorable
quarter stagger, the markets ultimately U.S. Fixed Income 0.42%
Returns (Barclay Capital Aggregate Bond Index)
proved they were tough enough to
Over the course of the past three
survive this “one-two punch.” International Fixed Income -0.77%
months, investors were forced to over-
come a number of major shocks, yet (JP Morgan GBI ex-US (Hedged) Index)
U.S. large companies, as measured
posted the best first quarter for U.S. U.s. Equities, Large 5.92%
by the S&P 500 index, were up 5.92%
equities since 1999. As global markets (S&P) 500 Index)
(including dividends) and U.S. small
continue to recover, we continue to
see growing optimism that the recov-
companies performed even better, U.S. Equities, Small 7.94%
returning 7.94%. International stocks (Russell 2000 Index)
ery from the 2008 financial crisis has
gained modestly as well, returning
become self-sustaining, albeit fragile.
2.67% for the quarter, while interna- International Equities, Large 2.67%
(MSCI EAFE Index)
tional small company stocks were up
Investors experienced positive returns
across almost the entire spectrum of
4.34%. Commercial real estate re- International Equities, Small 4.34%
turned a positive 7.5% and commodi- (S&P/Citigroup EPAC Ext. Mkt. Index)
asset classes for the first three months
ties, as measured by the Dow Jones
of the year. However, achieving these Real Estate Investment Trusts (REITs) 7.50%
UBS Commodities Index, were up (NAREIT Equity Index)
end results was anything but a smooth
4.45%. Bond rates continue at historic
ride. As sovereign debt issues con- Commodities/Natural Resources 4.45%
lows, yet owning high quality fixed
tinued to plague Europe, the markets (DJ UBS Commodities Index)
Continued Pg. 4
were thoroughly tested by the political
Congratulations CLINT AT A GLANCE wife, Sarah, who I married just this last May.
After finishing my degree, I worked at Tyler
By: Clint McCalla
Technologies as a Client Services Specialist
up until this last December. I entered the Mas-
LAURIE AND ZACH BELEW ON I met the FJY team through our Opportunity
ter of Science in Personal Financial Planning
Days event at Texas Tech University this last
THE SAFE ARRIVAL OF KATE program at Texas Tech University in January
February. I interviewed with Jon Yankee dur-
BELEW ON MARCH 26TH ing the career days portion of the activities 2010 Continued Pg. 3
after Josh Blair, a former Summer Associate at
FJY, had suggested I apply for their internship
position. I consider myself truly blessed to be
MARJORIE FOX AND given this opportunity to learn from some of
DAN JOSS the best in the industry and look forward to
meeting the rest of the team in May.
RECENTLY NAMED AS TOP
FINANCIAL PLANNERS IN THE I am originally from Greenville, Texas where
APRIL EDITION OF NORTHERN my parents still live. I moved to Lubbock,
Texas in August of 2005 to pursue a Bachelor
VIRGINIA MAGAZINE of Arts in Economics which I completed early
in May 2008. During this time I also met my
QUICK PLANNING QUESTION:
DO YOU NEED A SAFE DEPOSIT BOX? THE BUSINESS BANK HAS BOXES AVAILABLE AT ALL SEVEN LOCATIONS IN NORTHERN VIRGINIA.
ON A THREE YEAR AGREEMENT, THE BUSINESS BANK IS OFFERING THE FIRST YEAR FREE FOR FJY CLIENTS.
PLEASE CONTACT THE BUSINESS BANK FOR MORE DETAILS. WWW.BUSINESSBANKVA.COM
2. GIFTS AND GIVING, PART 1 tax preparer about tax consequences of this
type of account. A custodial account can
could easily provide for college and a have a
generous gift ready for that new car or what-
By: Daniel D. Joss, MBA, CFP®, RLP®
contain various investments and proceeds ever that new college grad hopes for within
from these investments will be used for the the limits of the annual gift exclusion. Start
“Gifts and giving” is a very big topic and
benefit of the child. An advantage of this early, give often, and let time and investment
not likely to be covered well in 500 to 800
account is that the proceeds can be used returns work for you. We can help you man-
words. So, this quarter I’ll forgo the lecture
for any reason for the benefit of the child. age your gifts to the next generation.
on how we all should be giving more and
Uses are not limited to qualified educational
how charities are receiving less because
expenses. This account can be used to
of our recent economic issues. Instead, I’ll
focus a few words on non-charitable giving
teach an older child about investments, NEW RULE CHANGE TO
dividends, stock, mutual funds, etc… When
and give a few examples of how our clients
the child turns age 18 or 21, the account is SOCIAL SECURITY BENEFIT
express their love by giving to those in their
lives.
then retitled to the child as the “new owner”
giving him or her control of the asset. Some
OPTIONS
By: Tess Downing, MBA
clients plan to make the account balance
FJY often assists with the transactions of our
zero by age of majority. Other clients want a Your retirement decisions just became even
clients as they give or receive money or stock
balance left as a gift for them at graduation or more important with a new rule change
to or from family members. There are several
celebration of adulthood. They wish to send from the Social Security Administration. Due
ways to give, which may depend upon the
them on their way with an investment in their to the recent publicity surrounding social
amount of gift, the control the giver intends
future. security strategies, the current Administra-
the recipient to have over the gift, the age of
the recipient, and tax related issues. Types tion has decided that it will no longer allow
Retirement someone to collect benefits at a lower rate
of accounts include 529 plans, custodial
Several of our clients make contributions to and then payback those benefits to receive
accounts, Roth or traditional IRA accounts,
retirement plans for their grown children. an increase in their payments at a later date.
and individually owned accounts. Types of
This is a wonderful way of transferring wealth This strategy is often known as the “Do-Over”
assets include cash, EE Savings bonds, and
to the next generation. With it, the recipient or the “Payback Method.”
stocks, bonds, mutual funds and trusts.
is receiving a much larger future gift. If an
adult child earns $5,000 or more in a given For example, at age 62 you decide to start
Education
taxable year, yet is short on cash to set aside your social security benefits at the reduced
One common example of giving is parents or
for their retirement, a parent, relative, or rate of $750 a month. At age 64, you then
grandparents contributing money into a well
anyone else, could contribute $5,000 to that decide you would like to stop the payments.
managed 529 plan for future college ex-
recipient’s Roth or traditional IRA. The plan You then must payback all of the benefits
penses of a child or grandchild. A 529 plan
works best when the recipient lets the con- you received interest- and penalty-free.
allows gifts to be contributed and removed
tribution grow in a well diversified portfolio Then at age 66, you decide to start collecting
from the estate of the giver, yet allow the
for many years. In the case of a Roth IRA, the benefits at your full retirement age (FRA) at
giver control over the funds until they are
distributions will be tax-free. $1,000 a month. However, if you wait until
distributed for qualified education expenses.
The contributions grow tax free for years and, age 70, you could receive $1,320 a month.
Taxation (source: www.ssa.gov)
because it is an investment account, there is
In each of these cases, the giver must re-
potential for investment returns, not just inter-
member that the federal government does The “Do-Over” strategy has gained in popu-
est. Sometimes, the beneficiary of the 529
not want them to give their wealth to the larity in recent years. According to Kip-
plan doesn’t know they are the beneficiary of
next generation and avoid estate tax. So, the linger’s, in 2007, only 500 retirees chose to
the very valuable gift.
IRS has given us guidelines regarding how payback their benefits to start receiving a
much can be given without worrying about higher benefit. But by 2009, the number of
Custodial
taxes. In 2011, each giver can give up to retirees had doubled as they realized they
Another gift we help with is the management
$13,000 (annual gift tax exclusion amount) to could repay their benefits interest-free and
of custodial accounts for minor children.
each recipient without worries. This amount penalty-free. They were also able to claim a
Contributions are made to the account for
is not so limiting as a couple could each tax credit or deduction for any income taxes
the benefit of the child. Earnings in this ac-
give $13,000 to each of their children and paid on the benefits.
count are taxed annually so speak with your
grandchildren, each year. A generous family Continued Pg. 4
3. COULD IT BE TRUE, IS YOUR you would use the 50 year average annual
compounded housing appreciation rate of
not a factor.
DC METRO AREA HOME 4.5%, and you would see a 10 year return
of $226,797 in value growth on that home.
With homeownership, you also get the
mortgage interest deduction on mortgage
REALLY ONE OF THE BEST Then, since the average homebuyer is financ- payments. This tax benefit brings the average
ing their purchase, we really need to be fair house payment down to a net monthly figure
PERFORMING INVESTMENTS IN in our comparison, and see what the rate of below the monthly market rent payment for
return has been on the actual cash invested. that same house. However, when you own
YOUR ENTIRE PORTFOLIO? a home, you do have maintenance costs
By: Thierry Roche, SFR, CDPE On a $400,000 home purchase, we will you need to spend money on, and that will
use an average down payment amount of generally even out the tax savings difference
Believe it or not, for many local residents, it $60,000 (15% down payment) plus closing from that mortgage interest deduction.
is true. Generally speaking [and from FJY’s costs of $10,000 for a total investment of
perspective] your primary residence should $70,000. Now we find that an investment of It’s also important to consider a minimum
not be considered an investment in the true $70,000 that grows to $226,797 in 10 years is break even time period. The average in the
sense of the word. However, the returns an 11.8% annual compounded rate of return. DC metro area has been 4-5 years of home-
on your initial down payment can be quite I challenge you to find any large market that ownership, until your value has increased
impressive. has shown an average compounded rate of enough to cover all selling expenses.
return of approximately 12% annually over
Unfortunately, many publications just don’t the past 50 years. You won’t, because you According to the National Association of
“get it”, when it comes down to analyzing don’t get the kind of leverage in other market Realtors and the Mortgage Bankers Associa-
the rate of return on a home. They generally vehicles that you get with Real Estate, due to tion, their analysis shows that there has not
write articles or cite statistics that state hous- low cost mortgage financing. been a better market for buying a house in
ing’s average appreciation rate roughly equal the past 50 years due to the convergence of
to the rate of inflation over the past 50 years – Even more exciting is if you use a 10% down low interest rates, and lowered prices. Just
about 3.7% annual housing appreciation rate. payment of $40,000 plus $10,000 in closing imagine what the yields could be over the
In some areas (like our area), they calculate costs, which totals $50,000 invested. Then next 10 years if you buy a home now.
housing as a bit better than inflation rates, but you get a whopping 15.22% annual com-
maybe only 4.5% average appreciation rate pounded rate of return. On the other end Thierry is host of the DC areas longest running Real Estate
per year. On the surface, that does not sound of the spectrum a 20% down payment of Radio Show, ‘Inside Real Estate”, and a 22 veteran Realtor
like a very exciting rate of return. Especially with Re/Max in Northern VA. He can be contacted at
$80,000 plus $10,000 in closing costs, results thierry@thierryroche.com
when comparing to historical mutual funds in $90,000 invested, which generate a 9.28%
averages in the 8%-10% annual range. return- not too shabby. Plus, don’t forget, CLINT AT A GLANCE FROM PAGE 1
since you put up a larger down payment
But this is where the novice analyst/reporter of 20%, you will also have lower monthly after speaking with a friend who was at the
drops the ball and unknowingly misguides mortgage payments, so there is more money time completing his undergraduate degree in
the general public. When comparing housing you get to keep. Don’t forget to evaluate that Personal Financial Planning.
to inflation, these unwitting article authors in the total return, which will take it up over I have found the course of study to be both
compare the total cost or total current value 10% compounded annually. challenging and enjoyable, with the level of
of a home ($400,000 in our area) and its aver-
instruction received unparalleled.
age annual appreciation rate, to the annual Of course dissenters to these obvious facts I enjoy spending time with family, hunting,
Inflation rate. This understanding is lacking will stand up and yell, “You didn’t calculate fencing, gardening and cooking. I attend
in a true comparison of apples to apples. the cost of the monthly payments. That will Lubbock Baptist Temple with my wife where
Very few home buyers ever buy a home with bring the yield down to a lower number”. we are involved in various church ministries.
‘all cash’. Most finance their home purchase But, if they would stop and think before Again, I am extraordinarily grateful for the
with a mortgage. The actual cash invested jumping to conclusions, they would real- opportunity provided by the FJY team to ac-
averages between 10%-20% down payment, ize it is irrelevant - simply because if you quire practical financial planning experience
plus closing costs. don’t own a house, then you have to rent. at the highest level in a region on the very
Therefore, you have to make monthly pay- edge of current events. See you in May!
In order to properly break down the num- ments wherever you live, whether you make
bers on an average home price of $400,000, mortgage payments, or rent payments, so it is
4. The ability of the markets to respond so favor- At FJY, we continue to do our due diligence
ably can be partially attributed to central bank on your behalf in a number of different areas.
policies acting as shock absorbers during the During the first quarter, Dan and Tess attended
first quarter’s turmoil. The markets were con- the T-3 Technology Conference in Miami, FL –
tinuously flooded with money, from sources where Dan participated on one of the tech-
1925 Isaac Newton Square such as the U.S. Federal Reserve Bank, the nology experts panels. In addition, Marjorie
Suite 400 European Central Bank, and the Bank of Japan, attended the PIMCO Institute for Wealth Manag-
Reston, Virginia 20190 as we experienced a surge in oil prices and ers, in Newport Beach, CA, where she was able
witnessed the turmoil in Japan, the world’s to listen and participate in several discussions
1.703.889.1111 phone
third largest economy. In addition, nerves were regarding the PIMCO’s investment strategy
1.877.395.7795 toll free soothed as a result of actions taken to stabilize and their outlook of the current economic and
1.866.366.9233 fax currency markets after the earthquake. “In the market environments. We attend these types of
end, the market was able to get its head around conferences in order to continue to learn how
the idea that these events were unlikely to be to achieve better diversification in our managed
www.fjyfinancial.com major, macro-economic events,” says the head portfolios, which asset classes tend to zig when
of Global Research at RBC Capital Markets, others zag, and what new investment oppor-
Marc Harris. In addition to central bank mon- tunities exist that we should be explored. Stay
etary policies, U.S. private employers added tuned!
216,000 jobs in March, and a revised 194,000
in February, reflecting a reasonably-paced labor
recovery. Katelyn
Elizabeth
NEW RULE CHANGE TO SOCIAL Meanwhile, the U.S. stock market recovery has Belew
born
SECURITY BENEFIT OPTIONS FROM PG. 2 highlighted one of the peculiarities of invest-
March 26th,
ment math. Prior to March of 2009, the S&P 500
had fallen about 54% since its 2007 peak. The 7lbs 1.5oz
Essentially, individuals would take the
early benefit, invest the funds, and keep recovery since then has achieved a remarkable
the interest/capital gains earned and then 100% gain since that March 9 low point. Yet
the market has not yet fully recovered to its for-
FJY ADVISORS
payback the government with the initial
amount. mer heights. The reason is that investment math
tends to understate losses and overstate gains.
Under the new rule, retirees are still
allowed the option to withdraw their ap-
After a 20% decline in your investment portfo-
lio, you need a 25% gain before the portfolio & STAFF
is made whole again – and as the declines get
plication for benefits, but, only once during
bigger, the disparity grows dramatically, as we
MARJORIE L. FOX
their lifetime and that must happen within SR. FINANCIAL ADVISOR
the first 12 months of receiving benefits. have seen.
The new rule for the payback method DANIEL D. JOSS
makes the decision about when to start While investors’ nerves were tested by the SR. FINANCIAL ADVISOR
receiving social security benefits that more volatility of the first quarter, those who stayed JON P YANKEE
.
significant. If you do have questions about the course were rewarded for their paitence, SR. FINANCIAL ADVISOR
your specific situation, please contact FJY proving to the point that timing the market is still
to discuss the strategy that will be best for a fool’s errand. Achieving diversification, and LAURIE A. BELEW
living with the volatility of many different asset FINANCIAL ADVISOR
you and your family.
classes, is not always easy. We experienced TESS L. DOWNING
this especially during the Great Recession of ASSOCIATE FINANCIAL ADVISOR
QUARTER IN REVIEW FROM PG 1. 2008-09, when virtually every equity asset class
THOMAS N. SAUNDERS, JR.
fell in lock-step. We were fortunate in the first
quarter of this year that nearly every one of the
CLIENT RELATIONSHIP ASSOCIATE
income securities continues to provide
stability to investor portfolios, despite the traditional asset classes offered positive returns; LISA J. CRAFFORD
“headline risk” about which many investors but we do not anticipate that being the case OFFICE MANAGER
forever. Your investment eggs are in many bas-
continue to read. SALLY M. YANKEE
kets as a precaution against choppier markets, ADMINISTRATIVE ASSISTANT
whenever they may rear their ugly heads.
Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future
performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this newsletter, will be profitable, equal any corresponding indicated
historical performance level(s), or be suitable for your portfolio. Due to various factors, including changing market conditions, the content may no longer be reflective of current opinions
or positions. Moreover, you should not assume that any discussion or information contained in this newsletter serves as the receipt of, or as a substitute for, personalized investment
advice from Fox, Joss & Yankee, LLC. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/
she is encouraged to consult with the professional advisor of his/her choosing. A copy of our current written disclosure statement discussing our advisory services and fees is available for
review upon request.
Historical performance results for investment indices and/or categories have been provided for general comparison purposes only, and generally do not reflect the deduction of transaction
and/or custodial charges, the deduction of an investment management fee, nor the impact of taxes, the incurrence of which would have the effect of decreasing historical performance
results. It should not be assumed that your account holdings correspond directly to any comparative indices.