Greetings! Patterns emerge in the stock market, and times of great volatility are followed often by times of reduced volatility and great growth. This may have been what we just experienced this year, with the markets largely going up after last year, when the markets did everything but a back-flip. Our own equity-expert, Dr. Tom Howard, and our friend, Dr. Craig Callahan (who runs the mutual fund company, ICON Advisors), recently penned an article for Financial Advisors that I think the rest of us might enjoy. Follow the link for the complete details. Click Here. (5) So, does this period of quiet gains continue? Or are we heading for more volatility in the near future? Unfortunately, the good doctors do not provide a prescription that includes a time. Instead, they make a strong argument that volatility is our friend - not the enemy - because these volatile stories end well. And, fortunately, our time horizons for our stock investments are much longer than the periods of certainty or uncertainty directly ahead of us. Instead, we want to keep our eyes focused on long-term goals. |
| Weekly Economic Update | |
227,000 NEW JOBS, BUT JOBLESS RATE STILL AT 8.3% While unemployment levels remained unchanged in February, Labor Department data showed that nonfarm payrolls expanded by more than 200,000 positions for the third straight month. The private sector added 233,000 jobs in February, so it was basically responsible for the impressive net job gain. The underemployment rate (representing the jobless plus those settling for less than a 40-hour workweek) was 14.9% in February, a 1.8% drop from a year before. With such consistent job growth, the Federal Reserve faces less pressure to roll out another monetary stimulus. (1)
SERVICE SECTOR GROWS IN FEBRUARY The Institute for Supply Management's service sector PMI climbed to 57.3 for February, seeing a half-percent gain. A 3.1% jump in business activity/production and a 1.8% rise in new orders were nice highlights. (2)
OIL, GOLD END WEEK WITH MODERATE GAINS From Wednesday to Friday, gold futures rose $39.50 and oil futures $2.70. For the week, gains were actually modest: oil advanced but $0.70 on the NYMEX to $107.40 a barrel, while gold racked up a $2.10 gain to end Friday's COMEX session at $1,710.90 per ounce. The price of unleaded gas was $3.76 a gallon nationally on Friday per AAA's survey. (1,3)
LITTLE VOLATILITY AFTER GREEK BOND SWAP On Wall Street, March 5-9 mirrored the week before: the Dow pulled back (-0.43% to 12,922.02) and the NASDAQ (+0.41% to 2,988.34) and S&P 500 (+0.09% to 1,370.87) advanced. The market was still wary of the debt deal out of the EU - last week, 86% of investors holding Greek bonds agreed to swap securities issued by the Greek government for replacement ones worth less, and collective action clauses will force about 10% more of these bondholders to do so. While this seemingly opens the door for a new €130 billion EU/IMF rescue package for Greece, it could be the last bailout Greece receives. (1,4) |
| Market Summary |
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% Change |
Y-T-D |
1Yr Chg |
5-Year Avg | |
DJIA |
+5.77 |
+5.80 |
+1.05 | |
NASDAQ |
+14.71 |
+8.60 |
+5.03 | |
S&P 500 |
+9.01 |
+3.86 |
-0.46 |
(Source: cnbc.com, bigcharts.com, treasury.gov, treasurydirect.gov - 3/9/12). Past performance is no guarantee of future results. Indices are unmanaged, and investors cannot invest in them directly. |
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Create a beautiful week!
Karl Frank, MBA, MSF
Certified Financial Planner (R)
A & I Financial Services LLC
303.690.5070
Citations:
(1) - money.msn.com/market-news/post.aspx?post=e280f203-b968-4fde-b06c-075eaf9a5756 [3/9/12]
(2) - www.ism.ws/ISMReport/NonMfgROB.cfm [3/5/12]
(3) - blogs.wsj.com/marketbeat/2012/03/09/data-points-energy-metals-552/ [3/9/12]
(4) - www.ism.ws/ISMReport/MfgROB.cfm [3/1/12]
(5) - http://www.financial-planning.com/fp_issues/2012_2
/analyzing-volatility-2677060-1.html
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 |
"Science is the great antidote to the poison of enthusiasm and superstition."
Adam Smith
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Karl Frank In Investor Advisor Magazine |
 | | Investor Advisor - November 2011 |
Investor Advisor Magazine's November 2011 edition features Karl Frank. In the article "Never Satisfied," John Sullivan writes: Passion born of tragedy drives Karl Frank to do all he can to help business owners ensure a legacy for loved ones and heirs. Industrial age publisher and philanthropist Frederick Bonfils said there is no hope for the satisfied man. If that's the case, Karl Frank is full of hope.
"I'm never satisfied," Frank says matter-of-factly when asked about his advisory firm
.....Read More. |
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Karl Frank was interviewed by 9News on January 9, 2012 regarding "Key Questions to ask when picking a financial advisor". | |
Click Here to View Video
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Riddle of the Week
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What word doesn't belong in this group: blast, paper, castle, coin, box, storm.
Last week's riddle:
Two fathers and two sons shopped for computers at their local big box retailer. Each bought a PC, yet they bought only three PCs total. How could this be?
Last week's answer:
The shoppers were a man, his son and his grandson.
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