July 23, 2010

Can you believe it?  We are actually 10 years into the 21st Century   Seems like just yesterday we were all overwhelmed by the Y2K media hype!  How time seems to fly.

The war between the Bulls and Bears continues unabated. The stock market has gone absolutely nowhere for the past 60 days.  In fact, we have been on another wild rollercoaster ride since the beginning of the year.  The net result is that the market is down year-to-date.

The following is a portion of an article from CNNMoney.com following our Federal Reserve Chairman’s report to congress last week.  I thought you might find it interesting.

Washington (CNNMoney.com) -- Federal Reserve Chairman Ben Bernanke warned Congress Wednesday that the economic outlook remains "unusually uncertain," but stopped short of revealing what the Fed might do to sustain the shaky U.S. recovery.

There had been growing expectations on Wall Street that the Fed chairman would give a clearer signal about additional steps the central bank might take to spur the economy in the face of growing weakness.

Instead, his semi-annual testimony offered little new policy direction, focusing on expectations that economic growth would allow the Fed to eventually pull money out of the system and raise short-term rates, as the economy improves.

The main question seems to be:  ‘Is our economy improving’ and if it is, ‘how long will it take’?  From all indications that I can gather the Fed and other financial “gurus” believe it will take 5+ years for the market to regain its pre-market crash of 2007 position.  

The good news is:  we here at CFI are maintaining a very conservative stance in your investment portfolio amid the current volatility.  Most of the analysts we utilize are currently in the bearish camp. So, until we see positive improvement in the financial data, we will remain mostly in cash and bonds.  My years of experience in the financial market have taught me these situations don’t last forever and I am optimistic we will begin to see improving circumstances in the near future.

On a more personal note, Thank You to everyone who has contacted me with well wishes.  I am still recovering from the injury to my back and I am about 85% healed. It is still uncomfortable, but at least I can now sit for short periods of time and get more work done.  I am definitely feeling better.

As always, if you would like to talk with me, please don’t hesitate to pick up the phone and give me a call.