Forecasts & Trends

This week we take an inside look at the massive government bailout bill that was hastily signed into law by President Bush late last Friday. As taxpayers who are ultimately on the hook for the now $850 billion bailout package, we need to understand how this program is expected to work (or not work). So I will give you the latest details as we understand them. I also ponder whether the bailout is, or is not, the right thing to do. Following that, we will take a look at the latest Electoral Map which has shifted significantly in Barack Obama's favor, unfortunately. Finally, we will revisit Scotia Partners and update you on their performance in the latest stock market meltdown....

The credit crisis has led to gridlock in the financial markets, and the stock markets have dropped like a stone. On Saturday, the Treasury Dept. and the Federal Reserve requested a massive $700+ billion bailout package that would allow the government to buy up troubled mortgage-related assets from banks and financial firms that are in trouble. Congress is reluctant to go along, but I expect they will provided they also get some money to help struggling homeowners and more oversight than the government offered initially. This week, we take a look at the latest enormous bailout plan and the latest government guarantee of money market funds. I also tell you why I believe we are now headed for a recession, and why I believe this huge financial mess will likely make Barack Obama our next president....

It is not uncommon to have major Wall Street players criticize traditional market timing strategies in the financial media. However, such criticism is somewhat misguided in today's market, when many buy-and-hold investors are suffering major investment losses. That's why I was somewhat surprised to see David Dreman, a known contrarian, tag along with the buy-and-hold crowd in a recent Forbes article. In this week's E-Letter, I'm going to take on Mr. Dreman's recent comments about traditional market timing strategies. I'll also show you his recent performance as compared to that of Scotia Partners, one of our latest market timing managers. You can then decide for yourself which one has had the upper hand in the recent volatile market environment....

This week, Mike Posey continues his Retirement Focus series on how to invest during retirement. In this installment, Mike discusses the asset allocation option, and its many variations found in the investment industry today. Asset allocation programs based on "Modern Portfolio Theory" (MPT) are among the most common investment strategies used today, primarily because MPT lends itself to computerization. However, the strategy is not without its critics, and individual allocations to the various asset classes can differ significantly among the various financial services industry players. You definitely need to read Mike's analysis so you can be fully informed when evaluating post-retirement asset allocation strategies....

The Fed left interest rates unchanged at 2% at the FOMC meeting last week, despite warnings in the media that rates would be increased. To the contrary, I have argued that the Fed will leave rates unchanged all year, and the FOMC policy statement last week supports that view. There are indications that inflation will moderate later this year, which will take pressure off the Fed to raise rates. Next, we turn our eyes to the stock market and ponder whether we are looking at a continued sideways market for several more years. If so, this will be bad news for millions of Baby Boomers that have not saved enough. Maybe it's time they consider something different, such as the investment programs I recommend....

This week we begin by taking the pulse of the US economy, which is holding up better than most analysts have expected. 1Q growth was better than forecast, and it now looks like the 2Q will be better than expected as well. The bad news is that inflation is on the rise, and there are fears that the Fed will begin to hike interest rates soon - but then maybe not - I'll give you my take on it. Finally, we focus on the presidential race which seems to be tightening according to the national polls. I will highlight Obama's background and his positions that bother me, and why I think he is the most arrogant candidate in a long time. Finally, we will take a detailed look at the 11 "battleground" states where the race could go either way. Feel free to share this analysis as you see fit....

This week, Mike Posey continues his Retirement Focus series on how to invest during retirement. In this installment, Mike covers the variable annuity option, which is gaining in popularity among retirees. I think this is a very important topic for any investor, especially in light of some of the questionable marketing tactics used to promote these contracts. You definitely need to read Mike's analysis before attending one of the "free lunch" seminars touting variable annuity investments. Mike also includes one of his "Retirement Tidbits," which discusses a retirement resource that I think you may find especially helpful....

If you are undecided about who to vote for in the presidential election, perhaps you should consider the Supreme Court. The next president will likely have the opportunity to nominate 2-3 Supreme Court justices. This week, we will discuss the current make-up of the Supreme Court and the deep divide among the liberal and conservative wings of the High Court. We will also consider what kind of judges Senators McCain and Obama would likely nominate if they are president for the next four years. If you have been reluctant to vote for McCain, the implications for the Supreme Court should help you make up your mind....