Towards Prosperity

Who voiced the following allegation?

“I believe that banking institutions are more dangerous to our liberties than are standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation and then by deflation, the banks and the corporations that will grow up around them will deprive the people of all their property until their children wake up homeless on the continent their fathers conquered.”

Here we are three months since my last writing in this space. The market had nice gains in April, gave back most of those gains since mid May, and is now in the typical “summer doldrums.” That means low-volume trading and no conviction from the big players to move the market higher. Account performance is not giving any of us much satisfaction. Understandably, I’ve had several questions from clients about this year’s market behavior. While nothing I say in these updates will fully assuage the feeling of poor market performance to which

Did the market gyrations of the first quarter make your stomach churn? Does it feel like a scary world out there? Let’s first get the bad news out of the way, and then we’ll assess what, in my opinion, really happened in the first quarter of 2008. My article is a little longer this quarter since I’ve had some questions from clients about recent market behavior.

Here’s what the fear mongers (the title of last quarter’s newsletter) are telling us:

Undoubtedly, you have noticed the market turbulence (volatility in Wall-Street speak) of the last three weeks. While the news media can exacerbate the problems, it helps to keep this short two- to three-week period of activity in perspective of the bigger picture. For instance, the well-regarded industry rag Barron’s recently proclaimed in huge red type “MARKET TURMOIL!” as its front-page cover. What they neglected to tell you until well into that week’s issue is that the DOW and Russell indices actually closed up for the previous week,

As I write this, the Federal Reserve Open Market Committee (the Fed) has just dropped the “Fed Funds” target rate to 4.75%. Without a doubt, dropping the Fed Funds rate is a positive event for stocks in the U.S. and worldwide. Further, the Fed’s rate cut should benefit a real estate market that is in a nationwide recession (if not depression.) The S&P 500 finished the day up 43.13 or 2.9%. Ok, so what is next? And, what would have happened had the Fed only cut the rate by one-quarter of one percent – or not cut the rate at all? How would that

With Dick Clark counting down as the ball dropped in Times Square, 2007 has now ended. It was another good year for our clients, although it might not have “felt” too wonderful in the last half of the year.