| Join Our List |
 |
|
|
|
GREEN SHOOTS OR JUST SHOOT? |
|
|
by Bob Van Wetter
 During what was a busy and news-filled quarter, the S&P 500 was up 15.93% including dividends. For the year, the S&P 500 is up 3.16%. The rise in global stock prices since early March has been a welcome development indeed and a tangible sign that economic activity is on the mend following the big banking and credit freeze last fall. Many leading economic indicators such as building permits and consumer confidence have leveled off and in some cases have begun to trend higher. Positive trend reversals often feed on themselves, creating a positive feedback loop that increases confidence and begets more positive economic data points. One example is corporate debt whose pricing has improved and yields have fallen. Previously capital-strapped companies have been able to raise considerable debt and equity capital in recent months. Coincidentally, and thanks to extraordinary liquidity measures by the government, market fears of bank insolvency have faded and the prices of bank stocks have risen dramatically off their lows. |
| WHITHER ENERGY PRICES |
|
by Dick Kopp
 Much has changed since I wrote about the outlook for crude oil at about this time last year. Oil prices had experienced a dramatic increase due to a number of factors that we discussed. I had pointed out the likelihood of a "sharp and steep" cyclical correction in oil prices. Since then, oil prices have declined with a vengeance that few of us had foreseen. The primary culprit has been the severe worldwide economic slowdown that has ensued. Individuals, businesses, and industrial users have all scaled back usage resulting in high inventories that are challenging storage capacity. While crude oil prices have about doubled off their recent lows, prices are still only about one half of where they were a year ago. Until we recover from the current economic malaise around the world, I doubt that much further price recovery will occur. On the other hand, looking beyond the next year or so, I feel that the longer term supply and demand concerns voiced last year will resurface. Oversupply fears will dissipate and upward pressure on prices will likely recur. The calls for alternative energy sources will persist, but significant commercial development seems far enough out that the risk to fossil fuels is some years away. |
| PREPARING FOR INFLATION |
|
| by Charlie Farrell
 With all of the talk about inflation in the news lately, we thought it would be helpful to summarize our fixed income strategy for a potential inflationary cycle. While many of the traditional ingredients for inflation are present in the economy, investors cannot be certain that inflation is the only possible outcome. Thus, our fixed income portfolios are generally structured to address three probable outcomes from this crisis: 1) high inflation, 2) no significant inflation, and 3) future declines in rates.
Also, I invite you to check out my latest blog post for CBS MoneyWatch. You can find it here. | |
|
700 17th Street, Suite 2350
Denver, CO 80202
(303) 832-2300 phone
(800) 204-6199 toll-free
(303) 832-0034 fax
For archives of our newsletter and more places where Northstar is in the news, please visit our website. For reprints of any article in this issue, please call or e-mail us at the address listed above. 
From left to right: Fred Taylor, Tim Waymire, Dick Kopp, Bob Van Wetter, and Charlie Farrell |
|
|
