A&I Financial Services Periscope

A & I Financial Services LLC Newsletter

For the Week of
May 5, 2011
 

What an amazing week for news! It's a good thing we investors don't care about the news, right?

 

On Monday, we learned details about the death of the most wanted man in the world, Osama Bin Ladin.

 

On Wednesday, we learned that 1 in 7 of Americans is on food stamps. Colorado is lucky, only 1 in 8 Coloradoans using Government stamps to eat. (1)

 

And on Friday we'll reflect on the 1-year anniversary of the Flash Crash.  By the time you read this, you can tell me if we're experiencing déjà vu in 2011.

 

Bin Ladin, of course, brings back awful memories. Where were you on September 11, 2011? I'll never forget it. I was working for a company that was bought 5 times in 5 years, eventually by Lehman Brothers (remember them?).  We had folks in our office from Mexico, England, Czechoslovakia, Japan, and all over the USA.

 

Our President was from France. I'll never forget watching him cry as we sat in front of a tiny TV, mesmerized by the falling of the towers. I called my wife, Stacey, then pregnant with our (now) 9-year old daughter and told her to get out of the city, America was under attack.

 

Some of the guys swore they would enlist with the military, and some of them did. I made a phone call to our Manchester, England office and they said how do you feel? I said I feel like we are going to war. 

 

What is your story? 

Economic Briefs
CONSUMER SPENDING INCREASES 0.6%
This March gain wasn't that surprising in light of rising food and energy costs. (The Commerce Department just revised February's gain to 0.9%). Disposable incomes were up by 0.1% in March while the personal savings rate held steady at 5.5%. The Commerce Department also released its initial estimate of 1Q 2011 GDP Friday (+1.8%) and 1Q consumer spending (+2.7%). (2)

CONSUMER CONFIDENCE REBOUNDS
The University of Michigan's final April consumer sentiment survey came in at 69.8, up from March's final reading of 67.5. The one-year inflation expectation was 4.6%, the same as last month. The Conference Board's April consumer confidence poll came in at 65.4, better than the median projection of economists surveyed by Bloomberg. Both indices improved despite gas prices rising - AAA said a gallon of regular unleaded averaged $3.87 on April 27, the highest price since August 2008.(2,3)
  
CASE-SHILLER INDEX WITHIN .01% OF DOUBLE-DIP
February's Case-Shiller Home Price Index revealed a 3.3% year-over-year drop in prices across 20 metro areas. Most notably, the index was down 1.1% from January to just .01% above its April 2009 trough. Prices in 14 of the index's 20 metro areas have declined for six months or more. In more positive news, the Census Bureau said new home sales increased by 11.1% from February's record low. The National Association of Realtors said pending home sales were 5.1% better in March than in February.(4,5)
  
STOCKS FINISH APRIL WITH A FLOURISH
Stocks took their cues from earnings last week, and earnings were mostly strong. The weekly performance numbers: DJIA, +2.44% to 12,810.54; S&P 500, +1.96% to 1,363.60; NASDAQ, +1.89% to 2,873.54. The DJIA rose 3.98% in April. (6)
  
Market Summary

% Change

Y-T-D

1Yr Chg

5-Year Avg

DJIA

+10.65

+14.71

+2.54

NASDAQ

+8.32

+14.40

+4.74

S&P 500

+8.43

+12.99

+0.81

(Source: cnbc.com, bigcharts.com, treasury.gov, treasurydirect.gov - 4/29/11)
Create a beautiful week!

Karl Frank, MBA, MSF
Certified Financial Planner (R)
A & I Financial Services LLC
303.690.5070
 

Citations:
(1) - http://blogs.wsj.com/economics/2011/05/03/about-1-in-7-americans-receive-food-stamps/?KEYWORDS=food+stamps
(2) -bloomberg.com/news/2011-04-29/personal-spending-in-u-s-
rises-0-6-incomes-climb-more-than-forecast.html [4/29/11] 
(3) - bloomberg.com/news/2011-04-29/u-s-consumer-sentiment-gains-as-index-climbs-to-69-8-from-67-5-in-march.html [4/29/11]
(4) - seattlepi.com/realestate/article/Home-prices-continue-to-slide-nationwide-more-so-1353033.php [4/26/11]
(5) - bloomberg.com/news/2011-04-28/pending-sales-of-existing-homes-in-u-s-increase-5-1-more-than-estimated.html [4/28/11]
(6) - cnbc.com/id/42827178 [4/29/11]
 
This material has been prepared and is distributed solely for information purposes only. It is not a solicitation or an offer buy any securities or instrument or to participate in any trading strategy. There is no assurance that a particular trading strategy will achieve investment success.

 

Securities offered through Geneos Wealth Management, Inc., member FINRA/SIPC.  Investment advisory services offered through A & I Financial Services LLC, registered investment advisor.


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 Helen Keller
Watch Karl Frank on Channel 9 News & Read his article "Where to Invest in Times of Turmoil"

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Karl Frank was interviewed in The Denver Magazine.  The article talks about investing in our renewable energy future.

 

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Karl Frank & Cameron Morgan were featured in the Denver Post.  They talked about how to have a happy holiday while sticking to a budget. 

 

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Karl Frank, Certified Financial Planner, provided several Money Makeovers for families on CBS Channel 4. 
 
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 Beating the Recession
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FPA Week
Riddle of the Week
You go in through one hole, you come out through three holes. Once you're inside you're ready to go outside, but once you're outside you're still inside. What is it? 
  

Last week's riddle: 

      What is the smallest number of cars that can be driven down the road in this formation: two cars ahead of a car, two cars behind a car, and a car between two cars?

Last week's answer: 

 

Three: one car in front, one in the middle, and one behind