A&I Financial Services Periscope

A & I Financial Services LLC Newsletter

For the Week of
July 20, 2011
 
Greetings!   
         
A recent study from SunAmerica reveals that having two recessions in 10 years has changed how we think about money.

Folks age 55 and over say that financial peace of mind is now six times more important than accumulating wealth. Protecting assets is now five times more important than investing aggressively to make up for lost time.

Americans recognize that new economic realities call for new financial solutions. They are seeking investments that will help protect their income from market loss, guarantee rising income, and guarantee income for life.

More Americans are now wanting professional financial advice - and those who have used an advisor are 72% more likely to feel very financially prepared. (1)
A Money Manager's Point of View

 

Some money managed by Bob Doll at Blackrock is in many of our clients' portfolios. Here are some take-aways. Email us for the full article:
 

* In our view, there is virtually no chance that the gridlock reaches a point that could cause an actual default on US Treasury debt.


* While we are expecting to see additional volatility, we view the current period of weakness as a potential buying opportunity.


* The economy has entered a soft patch, but this should be a temporary condition.


* Ultimately, we are expecting to see better news concerning the US economy and are calling for a reacceleration in growth in the second half of 2011.  


Should Bob Doll be correct, it should reassure investors that the global recovery will persist, which should help stock prices to again move higher. (2,3)

 

Meet the Manager: AthenaInvest

Tom Howard, PhD University of Denver

CEO and Director of Research AthenaInvest

 

We had such great feedback from last month's lunch with AthenaInvest, we are offering another opportunity to Meet the Manager for those of you who live on the west side of town.

 

Please join us for lunch and a conversation with Dr. Tom Howard, who will share his insights on the importance of expected returns in managing investment portfolios.

 

Let us know if you are interested in attending lunch, receiving a complimentary portfolio analysis or learning more about AthenaInvest.

 

WHEN:  Tuesday, July 26th   Noon - 1:00 PM 

WHERE:  240 Union - 240 Union Boulevard, Lakewood, CO


RSVP:  Jane Ericson, 303.690.5070 or [email protected]

Please RSVP by Friday,  July 22nd  

Seating is limited! 

Economic Briefs

 

DEBT ISSUES DOMINATE THE HEADLINES
Friday, President Obama reassured the media that Democrats and Republicans had "enough time" to "create a package that solves the deficit and debt." While Congress needs to hike the debt cap by $2.4 trillion to enable federal borrowing through the end of 2012, Republican leaders want an equivalent federal spending cut linked to such a move. This week, House Republicans intend to vote on a plan to accomplish both goals, reliant on a constitutional amendment requiring a balanced federal budget. House Minority Leader Nancy Pelosi (D-CA) calls the measure "outrageous." Another plan offered by Senate Minority Leader Mitch McConnell (R-KY) would give the President more autonomy to lift the debt cap. In Europe, Italy's parliament passed austerity measures to cut $99 billion from that nation's deficit by 2014.(4,5,6)

CONSUMER PRICES RETREAT 0.2% IN JUNE
This marks the first dip in the Consumer Price Index in 12 months. The big reason? Gasoline prices fell 6.8% last month. Stripping out food and energy prices, core CPI rose 0.3% in June (as it did in May). All this brought annualized inflation to 3.6% (1.6% in core terms). Producer prices also decreased last month - June's PPI fell 0.4%, the first monthly decline in a year.(7)
 
CONSUMERS BUY A BIT MORE, FEEL WORSE
Consumer sentiment has plummeted. The initial July Thomson Reuters/University of Michigan survey came in at 63.8, the lowest reading in 28 months. Census Bureau data had retail sales improving 0.1% in June and 8.1% annually.(8,9)

GOLD PUSHES TOWARD $1,600
Futures settled at a new all-time peak Friday: $1,589.80 an ounce. That capped a 7.25% gain across two weeks, 3.15% of it coming last week.(10)
 
STOCKS PULL BACK
Here is how the major indices performed last week: S&P 500, -2.06% to 1,316.14; DJIA, -1.40% to 12,479.73; NASDAQ, -2.45% to 2,789.80.(11)  
Market Summary

% Change

Y-T-D

1Yr Chg

5-Year Avg

DJIA

+7.79

+20.47

+3.24

NASDAQ

+5.16

+24.04

+7.39

S&P 500

+4.65

+20.03

+1.29

(Source: cnbc.com, bigcharts.com, treasury.gov, treasurydirect.gov - 7/15/11).  Past performance is no guarantee of future results.  Indices are unmanaged, and investors cannot invest in them directly.
Create a beautiful week!

Karl Frank, MBA, MSF
Certified Financial Planner (R)
A & I Financial Services LLC
303.690.5070
 
Citations:   
(1) - http://view.s4.exacttarget.com/?j=fe8e157875620c7474&m
=fe991570756d027d73&ls=fdfd15737662077976137475&l=fef812767d6506&s
=fe611d777664047e7110&jb=ffcf14&ju=fe561576736c027e7311&r=0
(2) - Blackrock - An Investment Perspective: Summer Update, What's Ahead in 2011 by Bob Doll
(3) - Blackrock Weekly Investment Commentary By Bob Dall 6/27/2011 
(4) - money.cnn.com/2011/07/15/markets/markets_newyork/ [7/15/11] 
(5) - online.wsj.com/article/BT-CO-20110715-711566.html [7/15/11]
(6) - nytimes.com/2011/07/16/world/europe/16italy.html [7/15/11]
(7) - online.wsj.com/article/SB10001424052702304521304576447641965
268196.html [7/15/11]
(8) - cnbc.com/id/43768567/ [7/15/11]
(9) - census.gov/retail/marts/www/marts_current.pdf [7/14/11]
(10)  - blogs.wsj.com/marketbeat/2011/07/15/data-points-energy-metals-500/ [7/15/11]
(11) - cnbc.com/id/43773110 [7/15/11]

 
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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Words for Thought
"The task of the modern educator is not to cut down jungles, but to irrigate deserts."

C.S. Lewis
Watch Karl Frank's interview on MoneyLine9 9NEWS on May 9, 2011

Click Here

 

 

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

Click Here

 

Read about us in the Denver Post

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

 

Click here to read the article.  

Riddle of the Week
Name two words in the English language that have the letter I twice in the middle of the word.  
  

Last week's riddle: 

  

 A librarian finds that pages have been ripped out of a novel. Pages 28, 29, 148, 211 and 212 are torn out. Given this, how many separate sheets of paper have been torn from the book?

 

 Last week's answer: 

 

  Four sheets of paper (not five). Pages 211 and 212 are on opposite sides of the same sheet of paper.