Weekly Economic Update February 25, 2013

WEEKLY QUOTE “You miss 100% of the shots you never take.”       – Wayne Gretzky           WEEKLY TIP Inflation is tame right now, but keep in mind that even moderate inflation can have significant impact. For example, today’s $20,000 car would cost roughly $29,600 in 2023 after ten years of just 4% annual inflation.       WEEKLY RIDDLE What can explode slowly, with no smoke or flame?        Last week’s riddle: If a single-engine airplane taxied not onto a runway, but onto an enormous conveyer belt whose speed precisely equaled that of the plane in the opposite direction, could the plane still manage to take off?     Last week’s answer: Yes, eventually. A plane’s wheels roll freely, and the thrust generated by the prop or jet engine will still be greater than drag and the lift created by air flowing over the wing will still be greater than the aircraft’s weight.	February 25, 2013     HOME SALES RISE, HOUSING STARTS FALL January brought a 0.4% improvement in existing home sales, even as the inventory of properties for sale hit a 93-month low. The National Association of Realtors reported a 25% year-over-year decline in existing home inventory, which hasn’t been seen since December 1999. The median sales price was $173,600 last month, up 12.9% from a year ago. Turning to new construction, housing starts dropped 8.5% in January after a 15.7% gain in December, but new home permits increased 1.8%.1,2 NO CHANGE IN CPI, BUT PRODUCER PRICES ADVANCE The Consumer Price Index was flat for a second straight month in January, with annualized inflation at just 1.6%. Core CPI (minus food and energy prices) advanced 0.3%, however – the biggest monthly gain since May 2011. The Producer Price Index rose 0.2% in January, with overall yearly wholesale inflation at 1.4%.3,4 SEQUESTRATION SEEMS IMMINENT On March 1, $85 billion in federal budget cuts are set to occur – and with Congress on recess last week, not much more than talk emerged about delaying them further. Friday, President Obama said he did not believe that the cuts were “inevitable” and commented that “this is not a smart way for us to reduce the deficit”. At the end of last week, no bipartisan effort to reschedule them was underway.5 STOCKS STAGE FIRST WEEKLY RETREAT OF 2013 Pronounced volatility returned to Wall Street last week due to earnings surprises and the January Federal Reserve policy meeting minutes, which raised concerns over the longevity of QE3. How did the key indices do last week? The numbers: Dow, +0.13% to 14,000.57; S&P 500, -0.28% to 1,515.60; NASDAQ, -0.95% to 3,161.82.6 THIS WEEK: Earnings reports from Lowe’s and Hertz arrive Monday. Tuesday, January new home sales figures, a new Conference Board consumer confidence poll and the latest Case-Shiller Home Price Index appear, and Fed chairman Ben Bernanke begins two days of testimony in Congress; Macy’s, Home Depot, Saks, AutoZone, Priceline and TiVo announce earnings. Reports on January pending home sales and durable goods orders are out Wednesday plus earnings from Target, Monster, Limited Brands, Dollar Tree, TJX, Groupon and JCPenney. Thursday offers quarterly results from Best Buy, Gap, Sears, Kohl’s and Barnes & Noble and the second estimate of Q4 GDP. Friday is March 1: sequester cuts may occur, the final February consumer sentiment index from the University of Michigan arrives, February’s ISM manufacturing index and reports on January consumer spending and vehicle sales appear, and Ben Bernanke speaks at the San Francisco Fed. % CHANGE Y-T-D 1-YR CHG 5-YR AVG 10-YR AVG DJIA +6.84 +8.21 +2.62 +7.46 NASDAQ +4.71 +7.80 +7.45 +13.44 S&P 500 +6.27 +11.63 +2.40 +7.87 REAL YIELD 2/22 RATE 1 YR AGO 5 YRS AGO 10 YRS AGO 10 YR TIPS -0.57% -0.27% 1.44% 1.93%   Sources: cnbc.com, bigcharts.com, treasury.gov – 2/22/136,7,8,9 Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly. These returns do not include dividends.
Please feel free to forward this article to family, friends or colleagues. If you would like us to add them to our distribution list, please reply with their address. We will contact them first and request their permission to add them to our list.
This material was prepared by MarketingLibrary.Net Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. Marketing Library.Net Inc. is not affiliated with any broker or brokerage firm that may be providing this information to you. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is an unmanaged, market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. It is not possible to invest directly in an index. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world’s largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. All economic and performance data is historical and not indicative of future results. Market indices discussed are unmanaged. Investors cannot invest in unmanaged indices. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional.   Citations. 1 – http://www.marketwatch.com/story/home-sales-inch-up-in-january-as-inventory-shrinks-2013-02-21 [2/21/13] 2 – blogs.wsj.com/developments/2013/02/20/housing-starts-fall-but-economists-stay-positive/ [2/22/13] 3 – http://www.foxbusiness.com/economy/2013/02/21/consumer-prices-flat-in-january/ [2/22/13] 4 – articles.marketwatch.com/2013-02-20/economy/37188507_1_wholesale-prices-vegetable-prices-higher-food-prices [2/22/13] 5 – abcnews.go.com/blogs/politics/2013/02/hope-springs-eternal-for-obama-on-budget-cuts/ [2/22/13] 6 – http://www.cnbc.com/id/100484753 [2/22/13] 7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=2%2F22%2F12&x=0&y=0 [2/22/13] 7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=2%2F22%2F12&x=0&y=0 [2/22/13] 7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=2%2F22%2F12&x=0&y=0 [2/22/13] 7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=2%2F22%2F08&x=0&y=0 [2/22/13] 7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=2%2F22%2F08&x=0&y=0 [2/22/13] 7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=2%2F22%2F08&x=0&y=0 [2/22/13] 7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=2%2F21%2F03&x=0&y=0 [2/22/13] 7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=2%2F21%2F03&x=0&y=0 [2/22/13] 7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=2%2F21%2F03&x=0&y=0 [2/22/13] 8 – http://www.treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [2/22/13] 9 – http://www.treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [2/22/13]

 

 

Weekly Economic Update November 7, 2011

WEEKLY QUOTE “Experience is a dear teacher, but fools will learn at no other.” – Ben Franklin WEEKLY TIP Starting a small business? A written plan is handy for forecasting, risk management and raising capital. A written plan is far preferable to one you keep in your head. WEEKLY RIDDLE What can run but never walks, has a mouth but never eats, has a head but never thinks, and has a bed but never sleeps? Last week’s riddle: A man brings a silver antique wrapped up in a towel to an appraiser, claiming it is a trophy engraved “To General Stonewall Jackson, presented after the first Battle of Bull Run, 1861.” The appraiser knows it is a fake without even looking at it. Why? Last week’s answer: People in 1861 wouldn’t have known it was the first Battle of Bull Run (the second occurred in 1862). Also, Stonewall Jackson fought for the Confederacy, which referred to the battle First Manassas.	November 7, 2011JOBLESS RATE DECREASES TO 9.0% Economists surveyed by Bloomberg News had expected unemployment to stay at 9.1% in October, so this was a nice development. Still, this latest jobs report had something in common with its predecessors: underwhelming job growth. Non-farm payrolls expanded by 80,000 positions last month, but that fell short of the 95,000 new jobs envisioned in the consensus Bloomberg forecast. On the bright side, the percentage of underemployed Americans fell from 16.5% to 16.2% and the long-term unemployed (those out of work for at least 27 weeks) shrank to 42.4% of the jobless population, the lowest percentage since November 2010. BOTH ISM INDICES MOVE LOWER The Institute for Supply Management’s purchasing manager indexes were both above 50 in October, but not quite where they were at a month before. The ISM manufacturing index slipped from 51.6 to 50.8; its service sector index ticked down to 52.9 from the preceding 53.0. The service sector employment gauge improved by 4.6% and moved from 48.7 in September (contraction) to 53.3 (expansion).2 GOLD & OIL POST WEEKLY GAINS Oil futures advanced 1.01% last week to settle at $94.26 per barrel on the NYMEX Friday. Prices have jumped 19.02% over the past five weeks of trading. Gold logged a 0.52% gain last week, closing at $1,755.30 an ounce on the COMEX Friday.3 GREEK THEATRE PREOCCUPIES WALL STREET The whims of Greek Prime Minister George Papandreou affected stocks more than anything last week: first he announced a public vote on the latest austerity cuts for the nation, reconsidered it, and then prepared to step down Friday amid concerns that he might change his mind. As these weekly performance numbers show, bears were roaming last week: DJIA, -2.03% to 11,983.24; S&P 500, -2.48% to 1,253.23; NASDAQ, -1.86% to 2,686.15.4,5,6 THIS WEEK: No major economic releases are slated for Monday; we do have results from Priceline and SYSCO. Eurozone finance ministers conclude their meeting in Brussels on Tuesday, and Toyota presents earnings. Wednesday, Ben Bernanke speaks at a Federal Reserve conference on small business; earnings come in from GM, Anheuser Busch, HSBC, Cisco, Green Mountain, Ralph Lauren, Macy’s and Wendy’s. Thursday we have earnings from Viacom, Kohl’s, Disney and Nordstrom; Ben Bernanke speaks at an El Paso town hall. Friday is Veterans Day: banks are closed, markets are open, and the initial October University of Michigan consumer sentiment survey arrives plus earnings from D.R. Horton. % CHANGE Y-T-D 1-YR CHG 5-YR AVG 10-YR AVG DJIA +3.50 +4.80 -0.000047 +2.69 NASDAQ +1.25 +4.22 +3.05 +4.98 S&P 500 -0.35 +2.63 -1.63 +1.36 REAL YIELD 11/4 RATE 1 YR AGO 5 YRS AGO 10 YRS AGO 10 YR TIPS -0.08% 0.44% 2.40% 3.50% Sources: cnbc.com, bigcharts.com, treasury.gov, treasurydirect.gov – 11/4/116,7,8,9Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly.These returns do not include dividends.
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This material was prepared by MarketingLibrary.Net Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is an unmanaged, market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. It is not possible to invest directly in an index. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world’s largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. All economic and performance data is historical and not indicative of future results. Market indices discussed are unmanaged. Investors cannot invest in unmanaged indices. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional.Citations.1 – http://www.bloomberg.com/news/2011-11-04/u-s-payrolls-increased-by-80-000-in-october-as-jobless-rate-falls-to-9-.html [11/4/11]2 – http://www.ism.ws/ISMReport/NonMfgROB.cfm [11/3/11]3 – blogs.wsj.com/marketbeat/2011/11/04/data-points-energy-metals-529/ [11/4/11]4 – montoyaregistry.com/Financial-Market.aspx?financial-market=financial-planning-and-wealth-management&category=4 [11/4/11]5 – http://www.cnbc.com/id/45166675 [11/4/11] 6 – http://www.cnbc.com/id/45163231 [11/4/11] 7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=11%2F4%2F10&x=0&y=0 [11/4/11] 7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=11%2F4F2%2F10&x=10&y=18 [11/4/11] 7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=11%2F4%2F10&x=0&y=0 [11/4/11] 7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=11%2F3%2F06&x=0&y=0 [11/4/11] 7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=11%2F3%2F06&x=0&y=0 [11/4/11] 7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=11%2F3%2F06&x=0&y=0 [11/4/11] 7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=11%2F5%2F01&x=0&y=0 [11/4/11] 7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=11%2F5%2F01&x=0&y=0 [11/4/11] 7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=11%2F5%2F01&x=0&y=0 [11/4/11] 8 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [11/4/11] 8 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [11/4/11] 9 – treasurydirect.gov/instit/annceresult/press/preanre/2001/ofm71101.pdf [7/11/01]

Weekly Economic Update October 24, 2011

WEEKLY QUOTE “Jealousy is the tribute mediocrity pays to genius.” – Fulton J. Sheen     WEEKLY TIP Many small business owners don’t have succession plans. If you haven’t created one, now is as good a time as any to start; this will not only enable continuity, but also address possible gift, income and estate tax issues.     WEEKLY RIDDLE I am in the center of gravity, and part of every victory. I am clearly seen in the midst of a river. I could name three who are in love with me and have three associates in vice. What am I?     Last week’s riddle: Trains travel from one town to another town all day, always on the same track, always going nonstop and at the same speed. The noon train took 80 minutes to complete the trip, but the 4 PM train took an hour and 20 minutes. Why?     Last week’s answer: 80 minutes is the same as an hour and 20 minutes.	October 24, 2011 ANNUALIZED INFLATION HITS 3.9% So noted the Bureau of Labor Statistics last week. The Consumer Price Index rose 0.3% during the month of September, with core CPI rising 0.1%, the smallest such increase in six months. (Annualized core consumer inflation was at 2.0%.) The Producer Price Index climbed 0.8% for September after a flat August.1   HOMEBUYING TAPERS OFF IN SEPTEMBER Existing home sales decreased by 3.0% last month, according to the National Association of Realtors. At this rate, about 4.91 million previously occupied homes will be sold in 2011, matching the total for 2010. In a normal year, about 6 million residential resales occur in the real estate sector.2 HOUSING STARTS UP 15% Here’s a good sign for residential real estate: a sign of demand. Most of the 15.0% monthly increase in September came from apartment construction; the Commerce Department reported a 53% monthly jump in that category. Single-family construction improved by 1.7%. Overall, there were 658,000 housing starts last month, the best number in any month since April 2010.3 DOW EXTENDS WINNING STREAK Wall Street rallied Friday on the eve of the crucial summit meeting to address the Eurozone debt crisis, helped by news that a new aid package for Greece had been approved by EU finance ministers. The DJIA gained ground for the fourth week in a row; the S&P 500 also advanced. The weekly numbers: S&P 500, +1.12% to 1,238.25; DJIA, +1.41% to 11,808.79; NASDAQ, -1.14% to 2,637.46.4,5 THIS WEEK: Earnings season is in full swing. Monday, earnings reports from Netflix, Amgen, Caterpillar and Texas Instruments hit the Street. On Tuesday, BP, Deutsche Bank, Amazon.com, Broadcom, DuPont, UBS and 3M issue 3Q results … and the August Case/Shiller Home Price Index comes out along with the Conference Board’s October gauge of consumer confidence. On Wednesday, quarterly results arrive from Boeing, VISA, GlaxoSmithKline,Sprint, ConocoPhillips and Ford and we have data on September new home sales and durable goods orders. Thursday brings the initial estimate of 3Q GDP and the data on September pending home sales, plus earnings from ExxonMobil, Occidental Petroleum, Baidu, P&G, Aetna, Bristol-Myers Squibb, Time Warner Cable, Hershey and Motorola Solutions. Friday, earnings from Merck and Chevron come out along with the report on September consumer spending and October’s final University of Michigan consume r sentiment index. % CHANGE Y-T-D 1-YR CHG 5-YR AVG 10-YR AVG DJIA +2.00 +5.94 -0.32 +2.59 NASDAQ -0.58 +7.23 +2.52 +5.44 S&P 500 -1.54 +4.91 -1.90 +1.36 REAL YIELD 10/21 RATE 1 YR AGO 5 YRS AGO 10 YRS AGO 10 YR TIPS 0.23% 0.50% 2.53% 3.50% Sources: cnbc.com, bigcharts.com, treasury.gov, treasurydirect.gov – 10/21/114,5,6,7,8 Indices are unmanaged, do not incur fees or expenses,and cannot be invested into directly. These returns do not include dividends.
Please feel free to forward this article to family, friends or colleagues. If you would like us to add them to our distribution list, please reply with their address.We will contact them first and request their permission to add them to our list.
This material was prepared by MarketingLibrary.Net Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is an unmanaged, market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. It is not possible to invest directly in an index. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world’s largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. All economic and performance data is historical and not indicative of future results. Market indices discussed are unmanaged. Investors cannot invest in unmanaged indices. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. Citations. 1 – nytimes.com/2011/10/20/business/economy/us-consumer-inflation-subdued-housing-starts-up.html [10/19/11] 2 – ajc.com/business/sales-of-previously-occupied-1206303.html [10/20/11] 3 – thestreet.com/story/11283665/1/raise-the-roof-housing-starts-up-15-in-september.html [10/20/11] 4 – montoyaregistry.com/Financial-Market.aspx?financial-market=an-introduction-to-the-stock-market&category=29 [10/21/11] 5 – cnbc.com/id/44988273 [10/21/11] 6 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=10%2F21%2F10&x=0&y=0 [10/21/11] 6 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=10%2F21F2%2F10&x=10&y=18 [10/21/11] 6 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=10%2F21%2F10&x=0&y=0 [10/21/11] 6 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=10%2F20%2F06&x=0&y=0 [10/21/11] 6 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=10%2F20%2F06&x=0&y=0 [10/21/11] 6 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=10%2F20%2F06&x=0&y=0 [10/21/11] 6 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=10%2F22%2F01&x=0&y=0 [10/21/11] 6 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=10%2F22%2F01&x=0&y=0 [10/21/11] 6 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=10%2F22%2F01&x=0&y=0 [10/21/11] 7 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [10/21/11] 7 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [10/21/11] 8 – treasurydirect.gov/instit/annceresult/press/preanre/2001/ofm71101.pdf [7/11/01]

Weekly Economic Update September 5, 2011

Phillip Statler  Presents:
WEEKLY ECONOMIC UPDATE
WEEKLY QUOTE “Friendship either finds or makes equals.” – Publilius Syrus     WEEKLY TIP If you are divorcing and will have joint custody of your children, clarify who will claim them as dependents on a federal return. If you both claim the same dependents, it might be a red flag for the IRS.   WEEKLY RIDDLE It weighs nothing, but when you put it into any container it makes the container lighter. What is it?   Last week’s riddle: In a drawer are 6 pairs of red socks, 4 pairs of white socks and 5 pairs of blue socks. In total darkness, how many socks would you have to grab to be certain you had a matching pair?   Last week’s answer: You would have to grab 4 socks – 4 is the maximum number you’d need to pull to insure you had at least 2 socks that matched. (Don’t believe it? Give it a try!)	September 5, 2011   NO JOB GAINS IN AUGUST In August, nonfarm payroll employment totaled 131.1 million – as it did in July. The Labor Department measured no job growth in the economy for the first time since September 2010. Additionally, employers reduced the average work week slightly to 34.2 hours. The unemployment rate remained at 9.1% last month.1 CONSUMER SPENDING IMPROVES BY 0.8% This hugely encouraging July figure from the Commerce Department trounced forecasts and represented the best month for the statistic since February. Personal incomes improved by 0.3% in July; the personal savings rate hit a four-month low.2 PENDING HOME SALES DOWN, HOME PRICeS UP The National Association of Realtors announced pending home sales had declined by 1.3% in July following three months of gains. The number of sales contracts was still 14.4% better than a year before. July’s Case-Shiller Home Price Index was notable for indicating a 3.6% 2Q gain in home prices, though the index was still down 5.9% year-over-year.2,3,4 MANUFACTURERS SIGNAL MINOR EXPANSION The Institute for Supply Management’s August purchasing manufacturers index ticked down to 50.6 from July’s 50.9 mark. So the sector is growing, but not by much (50 is the line between expansion and contraction). The new orders sub-index improved 0.4% to 49.6.5 STOCKS GIVE BACK SOME GAINS While the NASDAQ managed a 0.02% advance last week to settle at 2,480.33 on Friday, the S&P 500 and Dow had minor weekly losses. The DJIA retreated 0.39% to a Friday close of 11,240.26, and the S&P pulled back 0.24% to settle Friday at 1,173.97. Gold futures gained 4.43% on the week – prices jumped $47.70 on Friday alone.6,7 THIS WEEK: U.S. markets are closed for Labor Day. On Tuesday, ISM releases its August service sector index and Pep Boys issues earnings. Wednesday, the Fed puts out a new Beige Book and we have an earnings report from Hovnanian. Thursday promises to be interesting: the Bank of England and European Central Bank will each conclude policy meetings, Fed chief Ben Bernanke speaks in Minneapolis, President Obama addresses the nation on jobs and the economy, and of course new initial claims figures come out. Friday, we have earnings from Kroger. % CHANGE Y-T-D 1-YR CHG 5-YR AVG 10-YR AVG DJIA -2.91 +8.92 -0.39 +1.24 NASDAQ -6.50 +12.74 +2.62 +4.01 S&P 500 -6.65 +7.69 -2.09 +0.36 REAL YIELD 9/2 RATE 1 YR AGO 5 YRS AGO 10 YRS AGO 10 YR TIPS 0.00% 1.05% 2.25% 3.50% Sources: cnbc.com, usatoday.com, bigcharts.com, treasury.gov, treasurydirect.gov – 9/2/116,8,9,10 Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly. These returns do not include dividends.
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This material was prepared by MarketingLibrary.Net Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is an unmanaged, market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. It is not possible to invest directly in an index. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world’s largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. All economic and performance data is historical and not indicative of future results. Market indices discussed are unmanaged. Investors cannot invest in unmanaged indices. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional.Citations. 1 – latimes.com/business/la-fiw-jobs-20110903,0,2844276.story [9/2/11] 2 – nj.com/business/index.ssf/2011/08/consumer_spending_climbs_more.html [8/29/11] 3 – realtor.org/press_room/news_releases/2011/08/phs_july [8/29/11] 4 – blogs.wsj.com/economics/2011/08/30/vital-signs-home-prices-remain-low/ [8/30/11] 5 – ism.ws/ISMReport/MfgROB.cfm [9/1/11] 6 – blogs.wsj.com/marketbeat/2011/09/02/data-points-u-s-markets-47/ [9/2/11] 7 – blogs.wsj.com/marketbeat/2011/09/02/data-points-energy-metals-518/ [9/2/11] 8 – usatoday.com/money/index [9/2/11] 9 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=9%2F2%2F10&x=0&y=0 [9/2/11] 9 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=9%2F2%2F10&x=10&y=18 [9/2/11] 9 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=9%2F2%2F10&x=0&y=0 [9/2/11] 9 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=9%2F1%2F06&x=0&y=0 [9/2/11] 9 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=9%2F1%2F06&x=0&y=0 [9/2/11] 9 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=9%2F1%2F06&x=0&y=0 [9/2/11] 9 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=9%2F4%2F01&x=0&y=0 [9/2/11] 9 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=9%2F4%2F01&x=0&y=0 [9/2/11] 9 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=9%2F4%2F01&x=0&y=0 [9/2/11] 10 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [9/2/11] 10 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [9/2/11] 11 – treasurydirect.gov/instit/annceresult/press/preanre/2001/ofm71101.pdf [7/11/01]

Weekly Economic Update, May 31, 2011

CONSUMER SPENDING SLOWS IN APRIL
Personal spending and personal incomes both increased by 0.4% last month – but the inflation-adjusted gains were minimal or non-existent. With inflation factored in, personal spending rose by 0.1% in April while personal incomes were flat. These latest numbers out of the Commerce Department aren’t very inspiring, especially since April’s small gains can be attributed to higher gas and food prices. However, many economists believe things will pick up in coming months, assuming gas prices moderate and more jobs appear.¹

EXPECTATIONS IMPROVE IN KEY CONFIDENCE POLL
The final May consumer sentiment survey is in from the University of Michigan. At 74.3, it shows a nice rebound from the final 69.8 mark for April. It also surpassed the 72.5 reading forecast by economists polled by MarketWatch. The 2011 high for the survey – 77.5 – was recorded in February before gas prices soared.²

MIXED NEWS FROM THE REAL ESTATE SECTOR
The Census Bureau said that new home sales improved by 7.3% in April. (Sales were 23.1% below the tax credit-influenced levels of a year ago.) The National Association of Realtors noted a dip in pending home sales: they fell 11.6% in April.^3,4

DEMAND LESSENS FOR HARD GOODS
Durable goods orders fell 3.6% in April, much more than the 2.5% slip anticipated by economists surveyed by Bloomberg News. Minus the volatile transportation category, hard goods orders still decreased by 1.5%.⁵

INVESTORS LEFT COLD BY TEPID INDICATORS
The latest economic reports suggest that the economy is going through a soft patch. They didn’t exactly trigger a wave of buying on Wall Street. Stocks pulled back for the fourth straight week, as follows: DJIA, -0.56% to 12,441.58; S&P 500, -0.16% to 1,331.11; NASDAQ, -0.23% to 2,796.86. One bright spot to note: the CBOE VIX retreated 8.15% for the week.⁶

THIS WEEK: Monday was Memorial Day, so U.S. financial markets were closed. Tuesday offers the latest edition of the S&P/Case-Shiller home price index and the Conference Board’s May snapshot of consumer confidence. June begins Wednesday, when we have the ISM May manufacturing index and a report on April construction spending. Thursday brings the latest initial claims figures and data on April factory orders. Friday is big – the April unemployment numbers are released and the ISM service sector index for May arrives.

Sources: cnbc.com, bigcharts.com, treasury.gov, treasurydirect.gov – 5/27/11^6,7,8,9
Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly.
These returns do not include dividends.

---

This material was prepared by MarketingLibrary.Net Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is an unmanaged, market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. It is not possible to invest directly in an index. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx^®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world’s largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. All economic and performance data is historical and not indicative of future results. Market indices discussed are unmanaged. Investors cannot invest in unmanaged indices. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional.

Statler Financial Services, Inc. is registered as an investment adviser with the state of Florida. The presence of this Web site on the Internet shall in no direct or indirect way to be construed or interpreted to suggest Statler Financial Services, Inc. is soliciting to sell advisory services or offering to sell advisory services to residents of any other state other than the state of Florida.

Citations.
1 – cnbc.com/id/43196816 [5/27/11]
2 – marketwatch.com/story/consumer-sentiment-rises-in-may-2011-05-27 [5/27/11]
3 – census.gov/const/newressales.pdf [5/24/11]
4 – seattlepi.com/realestate/article/Home-sales-deals-fall-in-nation-Seattle-area-1398967.php [5/27/11]
5 – dailyfx.com/forex/market_alert/2011/05/25/052411_US_Durable_Goods_Fall_Most_in_Six_Months.html [5/25/11]
6 – cnbc.com/id/43198036 [5/27/11]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=5%2F27%2F10&x=0&y=0 [5/27/11]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=5%2F27%2F10&x=10&y=18 [5/27/11]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=5%2F27%2F10&x=0&y=0 [5/27/11]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=5%2F26%2F06&x=0&y=0 [5/27/11]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=5%2F26%2F06&x=0&y=0 [5/27/11]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=5%2F26%2F06&x=0&y=0 [5/27/11]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=5%2F25%2F01&x=0&y=0 [5/27/11]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=5%2F25%2F01&x=0&y=0 [5/27/11]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=5%2F25%2F01&x=0&y=0 [5/27/11]
8 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [5/27/11]
8 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [5/27/11]
9 – treasurydirect.gov/instit/annceresult/press/preanre/2001/ofm11001.pdf [1/10/01]
10 – montoyaregistry.com/Financial-Market.aspx?financial-market=401k-companies&category=2 [5/30/11]

Weekly Economic Update, March 16, 2011

INFLATION SPRINGS AHEAD
Consumer inflation increased by 0.4% in April after rising 0.5% in March. (You can cite food and energy costs – gasoline prices rose 3.3% alone last month.) Annualized inflation is the real story here: the federal government’s Consumer Price Index has advanced 3.2% in the past 12 months. That is the biggest annual gain since October 2008. As for wholesale inflation, the Producer Price Index was up 0.8% for April; it showed an annual increase of 6.8% (the most since September 2008).^1,2,3

GAINS IN RETAIL SALES, Consumer SENTIMENT
The Census Bureau announced that retail sales were up 0.5% in April; it also revised the March gain from 0.4% to 0.9%. The University of Michigan’s preliminary April consumer sentiment survey came in at 72.4, better than the 70.0 forecast by economists polled by Reuters and the final April reading of 69.8.^1,4

KEY Commodities BOUNCE BACK
Last week, there was a bit of a rebound in precious metals and energy futures. Gold actually advanced 0.15% for the week; silver’s five-day loss was 0.77%. Oil futures gained 2.5% for the week on the NYMEX, while RBOB gasoline futures lost 0.6%.^5,6

BLEAKER OUTLOOK FOR MEDICARE, SOCIAL SECURITY
New reports from trustees of the entitlement systems project that Medicare’s trust fund will be depleted by 2024 and that Social Security’s trust fund will be exhausted by 2036 … if no action is taken. (Prior respective estimates were 2029 and 2037.) By these forecasts, Medicare would only be able to pay out 90% of retiree hospital insurance costs after 2024; after 2036, Social Security would only be able to pay out about 77% of scheduled benefits.⁷

A FAIRLY FLAT WEEK
While the NASDAQ pulled off a tiny weekly advance (+0.03% to 2,828.47), the Dow and S&P 500 ended up with some minor weekly losses (DJIA, -0.34% to 12,595.67; S&P 500, -0.18% to 1,337.78.)¹

THIS WEEK: No major economic releases come out Monday, but Federal Reserve Chairman Ben Bernanke speaks at Georgetown University. Tuesday offers reports on April housing starts and industrial output plus 1Q results from Wal-Mart, Dell and Home Depot. Wednesday, the most recent FOMC minutes are released and we have earnings from Target and HP. Thursday brings weekly jobless claims figures, data on April existing home sales, the Conference Board’s April LEI index and 1Q results from Sears, Gap and GameStop. No economic releases are scheduled for Friday.

Sources: cnbc.com, bigcharts.com, treasury.gov, treasurydirect.gov – 5/13/11^1,8,9,10
Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly.
These returns do not include dividends.

---

This material was prepared by MarketingLibrary.Net Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is an unmanaged, market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. It is not possible to invest directly in an index. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx^®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world’s largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. All economic and performance data is historical and not indicative of future results. Market indices discussed are unmanaged. Investors cannot invest in unmanaged indices. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional.

Statler Financial Services, Inc. is registered as an investment adviser with the state of Florida. The presence of this Web site on the Internet shall in no direct or indirect way to be construed or interpreted to suggest Statler Financial Services, Inc. is soliciting to sell advisory services or offering to sell advisory services to residents of any other state other than the state of Florida.

Citations.
1 – cnbc.com/id/43026751 [5/13/11]
2 – nytimes.com/aponline/2011/05/13/business/AP-US-Consumer-Prices.html [5/13/11]
3 – bloomberg.com/news/2011-05-12/u-s-april-producer-price-index-report-text-.html [5/12/11]
4 – census.gov/retail/marts/www/marts_current.pdf [5/12/11]
5 – blogs.wsj.com/marketbeat/2011/05/13/silver-gold-have-a-divergent-week/ [5/13/11]
6 – marketwatch.com/story/oil-futures-ease-but-stay-above-98-a-barrel-2011-05-12 [5/13/11]
7 – money.usnews.com/money/blogs/planning-to-retire/2011/05/13/financial-outlook-worsens-for-social-security-medicare [5/13/11]
8 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=5%2F13%2F10&x=0&y=0 [5/13/11]
8 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=5%2F13%2F10&x=10&y=18 [5/13/11]
8 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=5%2F13%2F10&x=0&y=0 [5/13/11]
8 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=5%2F12%2F06&x=0&y=0 [5/13/11]
8 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=5%2F12%2F06&x=0&y=0 [5/13/11]
8 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=5%2F12%2F06&x=0&y=0 [5/13/11]
8 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=5%2F14%2F01&x=0&y=0 [5/13/11]
8 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=5%2F14%2F01&x=0&y=0 [5/13/11]
8 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=5%2F14%2F01&x=0&y=0 [5/13/11]
9 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [5/13/11]
9 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [5/13/11]

10 – treasurydirect.gov/instit/annceresult/press/preanre/2001/ofm11001.pdf [1/10/01]

Weekly Economic Update, March 21, 2011

INFLATION PICKS UP
The Labor Department announced that the Consumer Price Index advanced 0.5% in February, following 0.4% advances in January and December. Energy prices climbed 3.4% in February and food prices rose 0.8%, the biggest monthly increase since July 2008. Annualized inflation now stands at 2.1% – a full percentage point higher than it was last November. The Producer Price Index climbed by 1.6% last month, the biggest monthly leap since June 2009; this puts annualized PPI at 5.6%. However, core CPI and core PPI did not advance so dramatically. In fact, core CPI and core PPI were both just +0.2% in February.^1,2

LEADING INDICATOR INDEX ADVANCES
The Conference Board index of leading indicators improved by 0.8% for February, which was below the 1.0% advance forecast by economists polled by Reuters but much better than the 0.1% gain for the previous month. The Conference Board’s report called the recent jump in food and energy prices a “headwind” in the face of the recovery.³

FEBRUARY SEES PLUNGE IN NEW CONSTRUCTION
Housing starts plummeted by 22.5% in February to 479,000, a number marginally better than the historic low measured by the Commerce Department in April 2009. How much of this is attributable to weather, we don’t know. Building permits touched a record low of 517,000 units last month.²

TWO DAYS OF RECOVERY ON WALL STREET
The major U.S. indexes rebounded strongly on Thursday and Friday from YTD lows touched on Wednesday. All three indices lost ground for the week, as these numbers show: DJIA, -1.54% to 11,858.52; S&P 500, -1.92% to 1,279.20; NASDAQ, -2.65% to 2,643.67. The CBOE VIX gained 21.81% on the week but fell 7.32% Friday.⁴

G7 INTERVENES IN JAPAN
The crisis in Japan saw the Yen soaring to a record 76.25, and threat of a recession was looming. But that fear was at least partially reduced when the G7 agreed to intervene to weaken the currency. By Friday the Nikkei 225 index was able to recover some of the ground it lost, but still dipped about 10% on the week. ^{8, 9}

THIS WEEK: Monday brings a report on February existing home sales; Fed chairman Bernanke addresses a conference of commercial bankers. Tuesday brings before-the-bell earnings from Walgreens and after-the-bell earnings from Adobe. Wednesday, we learn about new home sales in February; after the bell, we get earnings from General Mills. Thursday offers reports on last month’s durable goods orders and initial and continuing claims, and then after-the-bell earnings from Research in Motion and Oracle. Friday brings the final March reading for the University of Michigan’s consumer sentiment survey and the government’s final estimate of 4Q 2010 GDP.

% CHANGE	Y-T-D	1-YR CHG	5-YR AVG	10-YR AVG
DJIA	+2.43	+10.01	+1.03	+1.91
NASDAQ	-0.35	+10.55	+2.92	+3.55
S&P 500	+1.71	+9.73	-0.43	+0.93
REAL YIELD	3/18 RATE	1 YR AGO	5 YRS AGO	10 YRS AGO
10 YR TIPS	0.85%	1.45%	2.16%	3.52%

Sources: cnbc.com, bigcharts.com, treasury.gov, treasurydirect.gov – 3/18/11^4,5,6,7
Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly.
These returns do not include dividends.

This material was prepared by Peter Montoya Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information should not be construed as investment, tax or legal advice. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is an unmanaged, market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. It is not possible to invest directly in an index. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx^®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world’s largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. All economic and performance data is historical and not indicative of future results. Market indices discussed are unmanaged. Investors cannot invest in unmanaged indices. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional.

Statler Financial Services, Inc. is registered as an investment adviser with the state of Florida. The presence of this Web site on the Internet shall in no direct or indirect way to be construed or interpreted to suggest Statler Financial Services, Inc. is soliciting to sell advisory services or offering to sell advisory services to residents of any other state other than the state of Florida

Citations.
1 – latimes.com/business/la-fi-cpi-20110318,0,1486304.story [3/18/11]
2 – nytimes.com/2011/03/17/business/economy/17econ.html?_r=1 [3/17/11]
3 – reuters.com/article/2011/03/17/us-usa-economy-index-idUSTRE72G47620110317 [3/17/11]
4 – cnbc.com/id/42155882 [3/18/11]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=3%2F18%2F10&x=0&y=0 [3/18/11]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=3%2F18%2F10&x=10&y=18 [3/18/11]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=3%2F18%2F10&x=0&y=0 [3/18/11]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=3%2F17%2F06&x=0&y=0 [3/18/11]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=3%2F17%2F06&x=0&y=0 [3/18/11]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=3%2F17%2F06&x=0&y=0 [3/18/11]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=3%2F19%2F01&x=0&y=0 [3/18/11]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=3%2F19%2F01&x=0&y=0 [3/18/11]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=3%2F19%2F01&x=0&y=0 [3/18/11]
6 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [3/18/11]
6 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [3/18/11]
7 – treasurydirect.gov/instit/annceresult/press/preanre/2001/ofm11001.pdf [1/10/01]
8 – reuters.com/article/2011/03/18/japan-quake-markets-idUSL3E7EI0JO20110318 [03/18/11]
9 – money.cnn.com/2011/03/17/markets/world_markets/index.htm?iid=EL [03/18/11]
10 – montoyaregistry.com/Financial-Market.aspx?financial-market=common-mistakes-that-ira-heirs-make&category=1 [03/18/11]

HOW HEALTHY IS THE DOLLAR?

The strong dollar policy is long gone, but the greenback isn’t in peril just yet.

A favorite doomsday scenario. Have you heard about the forthcoming collapse of the dollar? Well, if you turn on your computer, your radio and even your TV, you just may. With the Federal Reserve poised to increase the money supply, the commentary on this topic is heating up again.

The scenario has variations, but the basic outline goes like this: An unexpected political or economic event leaves the dollar so weak that all confidence in it is gone. Foreign nations sell Treasuries in a panic and the Fed becomes the buyer of last resort. Traders and individual investors dump dollars for whatever they can get. Interest rates leap. Next stop: hyperinflation. America’s economy suddenly resembles that of Zimbabwe in 2007 or Germany in 1922.

So is there any validity to this scenario? Could the dollar collapse?

Let’s just say that the odds are very long. While the Federal Reserve will likely ramp up quantitative easing in the near future, it is highly unlikely that the dollar will suddenly become too cheap.

Why it is unlikely to happen. Foreign countries don’t want the dollar to collapse. Fundamentally, that is because some of the world’s biggest manufacturing economies rely on a great customer for their exports – the United States of America.

China and Japan currently hold 41% of America’s debt.¹ In the worthless dollar scenario, they are the key dominoes that fall. But what incentive do China and Japan have to sell dollars? Their economies are tied to U.S. consumer spending. Selling dollars would not benefit them – it would drive up the prices of their exports to America, it would wreck the economy of their best customer, and it would harm their own economies in turn.

The dollar is also the world’s reserve currency; it has been so since the U.S. abandoned the gold standard during the Nixon administration. While the central banks of China and Russia have argued that it should be supplanted or replaced, no challenger has knocked it off its pedestal. In spring 2010, the International Monetary Fund concluded that the dollar still accounted for 61.5% of global foreign exchange reserves, with the euro coming in a very distant second at 27.2%.²

In a way, the dollar has “collapsed” – and America is still standing. The dollar is much weaker today than it was in the 1990s, or even in the early 2000s. Its value has gradually declined and may decline further despite recent surges. In mid-October, the U.S. Dollar Index had slipped about 7% since August, and was approaching an all-time low set back in April 2008.³

America’s debt was less than $3 trillion in 1990; it has doubled since, and the federal Office of Management and Budget thinks it will hit $15 trillion by 2015.¹ The federal government would certainly rather pay those debts back using a declining dollar.

Of course, analysts also talked about the pound collapsing and the euro collapsing earlier this year. All this talk – and expectations about what the Fed will do – sent many investors toward the precious metals market, where gold and silver futures hit new highs.

A little word about diversification. When you hear commentators talking about the oncoming collapse of the dollar, take it with a grain of salt. This much is true so far: a dollar decline has occurred, and the dollar could weaken further. So it might be worthwhile to consider diversifying your portfolio as a cautionary move.

 

This material was prepared by Peter Montoya Inc., and does not necessarily represent the views of Statler Financial Services, Inc.  This information should not be construed as investment advice. Statler Financial Services, Inc. does not give tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. The publisher is not engaged in rendering legal, accounting or other professional services. If other expert assistance is needed, the reader is advised to engage the services of a competent professional. Please consult your Financial Advisor for further information.. http://www.petermontoya.com, http://www.montoyaregistry.com, http://www.marketinglibrary.net

 

Statler Financial Services, Inc. is registered as an investment adviser with the state of Florida. The presence of this Web site on the Internet shall in no direct or indirect way to be construed or interpreted to suggest Statler Financial Services, Inc. is soliciting to sell advisory services or offering to sell advisory services to residents of any other state other than the state of Florida.

Citations

1 – azcentral.com/news/articles/2010/09/19/20100919debt-of-us-grows-with-debate.html [9/19/10]

2 – businessweek.com/news/2010-06-30/dollar-share-of-global-reserves-declines-imf-says.html [6/30/10]

3 – bloomberg.com/news/2010-10-19/geithner-weak-dollar-policy-seen-as-path-to-recovery-in-contest-with-brics.html [10/19/10]

 

 

Weekly Economic Update, August 16, 2010

GOOD NEWS: INFLATION IS BACK
The Consumer Price Index rose 0.3% for July – the largest monthly increase since August. The Labor Department’s report quelled deflation worries among economists and investors who feared the CPI would go negative for a fourth straight month. Energy prices rose 2.6% in July, while core CPI (minus food and energy prices) went up 0.1%. Across the last 12 months of data, core CPI has increased 0.9% and overall CPI has advanced 1.2% – the mildest inflation in 44 years.^1,2

RETAIL SALES IMPROVE
The Commerce Department estimated a 0.4% gain in retail sales for July – a nice turnaround after two months in the minus column. (A 1.6% rise in motor vehicle and motor vehicle parts purchases certainly helped.)¹

A SLIGHT RISE IN CONSUMER SENTIMENT
The middle of the month brings the latest University of Michigan/Reuters consumer sentiment survey. The preliminary August edition came in at 69.6, slightly better than the 69.0 consensus forecast of economists polled by Bloomberg News.³

FED WILL BUY UP MORE DEBT
As if acknowledging that the recovery is not moving fast enough to stimulate notable growth or job creation, the Federal Reserve said it would use proceeds from maturing mortgage-linked securities to buy up U.S. Treasuries. Analysts estimate the Fed could buy $10 billion to $30 billion of the bonds per month. The new effort will keep the Fed’s portfolio of Treasuries around the $2 trillion level for the near future, with the goal of keeping long-term interest rates from rising. Fed policymakers left the benchmark interest rate unchanged last week.^4,5

BUSINESS INVENTORIES UP, BUSINESS SALES DOWN
The Commerce Department noted last week that business stockpiles grew by 0.3% for June, on the heels of a 0.2% increase for May. However, business sales fell by 0.6% – better than June’s 1.2% drop, but still the second monthly decline in a row after 13 straight monthly gains.⁶

ROUGH WEEK FOR WALL STREET
It was especially tough for the NASDAQ, which dived 5.02%. The S&P 500 slipped 3.78% last week while the DJIA lost 3.29%. Wednesday, Wall Street endured a major selloff on pessimism over the bearish FOMC statement and worries about a slowing global economy; that was the pivotal day of the week for stocks. Where did the indices settle at Friday? DJIA, 10,303.15; NASDAQ, 2,173.48; S&P 500, 1,079.27.⁷

% CHANGE	Y-T-D	1-YR CHG	5-YR AVG	10-YR AVG
DJIA	-1.20	+9.63	-0.56	-0.78
NASDAQ	-4.22	+8.17	+0.15	-4.35
S&P 500	-3.21	+6.57	-2.46	-2.76
REAL YIELD	8/13 RATE	1 YR AGO	5 YRS AGO	10 YRS AGO
10 YR TIPS	1.00%	1.80%	1.91%	4.03%

Source: cnbc.com, bigcharts.com, ustreas.gov, bls.gov – 8/13/10^7,8,9,10

Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly.

These returns do not include dividends.

This material was prepared by Peter Montoya Inc., and does not necessarily represent the views of Statler Financial Services, Inc. This information should not be construed as investment advice. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is an unmanaged, market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. It is not possible to invest directly in an index. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world’s largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. All economic and performance data is historical and not indicative of future results. Market indices discussed are unmanaged. Investors cannot invest in unmanaged indices. The publisher is not engaged in rendering legal, accounting or other professional services. If other expert assistance is needed, the reader is advised to engage the services of a competent professional. Please consult your Financial Advisor for further information. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. http://www.montoyaregistry.com http://www.petermontoya.com

Statler Financial Services, Inc. is registered as an investment adviser with the state of Florida. The presence of this Web site on the Internet shall in no direct or indirect way to be construed or interpreted to suggest Statler Financial Services, Inc. is soliciting to sell advisory services or offering to sell advisory services to residents of any other state other than the state of Florida.

Citations.

1 – economy.kansascity.com/?q=node/7992 [8/13/10]

2 – bls.gov/news.release/cpi.nr0.htm [8/13/10]

3 – bloomberg.com/news/2010-08-13/u-s-consumer-confidence-rises-more-than-estimated-michigan-index-shows.html [8/13/10]

4 – latimes.com/business/la-fi-fed-20100811,0,835529.story [8/11/10]

5 – federalreserve.gov/newsevents/press/monetary/20100810a.htm [8/10/10]

6 – cbsnews.com/stories/2010/08/13/ap/business/main6769597.shtml [8/13/10]

7 – cnbc.com/id/38696191 [8/13/10]

8 – bigcharts.marketwatch.com/historical/default.asp?detect=1&symbol=DJIA&close_date=8%2F13%2F09&x=0&y=0 [8/13/10]

8 – bigcharts.marketwatch.com/historical/default.asp?detect=1&symbol=COMP&close_date=8%2F13%2F09&x=0&y=0 [8/13/10]

8 – bigcharts.marketwatch.com/historical/default.asp?detect=1&symbol=SPX&close_date=8%2F13%2F09&x=0&y=0 [8/13/10]

8 – bigcharts.marketwatch.com/historical/default.asp?detect=1&symbol=DJIA&close_date=8%2F12%2F05&x=0&y=0 [8/13/10]

8 – bigcharts.marketwatch.com/historical/default.asp?detect=1&symbol=COMP&close_date=8%2F12%2F05&x=0&y=0 [8/13/10]

8 – bigcharts.marketwatch.com/historical/default.asp?detect=1&symbol=SPX&close_date=8%2F12%2F05&x=0&y=0 [8/13/10]

8 – bigcharts.marketwatch.com/historical/default.asp?detect=1&symbol=DJIA&close_date=8%2F14%2F00&x=0&y=0 [8/13/10]

8 – bigcharts.marketwatch.com/historical/default.asp?detect=1&symbol=COMP&close_date=8%2F14%2F00&x=0&y=0 [8/13/10]

8 – bigcharts.marketwatch.com/historical/default.asp?detect=1&symbol=SPX&close_date=8%2F14%2F00&x=0&y=0 [8/13/10]

9 – ustreas.gov/offices/domestic-finance/debt-management/interest-rate/real_yield.shtml [8/13/10]

9 – ustreas.gov/offices/domestic-finance/debt-management/interest-rate/real_yield_historical.shtml [8/13/10]

10 – treasurydirect.gov/instit/annceresult/press/preanre/2000/ofm11200.pdf [7/12/00]

Weekly Economic Update for the Week of March 22, 2010

Inflation? What inflation? Inflationary pressures remain weak in this subdued recovery. The Consumer Price Index was flat in February; core CPI rose 0.1%. CPI only advanced 2.1% over the last 12 months of data. Core CPI rose 1.3% in that period, the smallest year-over-year gain in six years. The Federal Reserve forecasts core CPI advancing 1.2% for all of 2010.^1,2

PPI drops in February. Producer prices decreased by 0.6% last month after a 1.4% rise in January; core PPI advanced 0.1%. Industrial production managed to rise 0.1% even with February’s rough weather.^2,3

Tiny LEI gain. Another 0.1% advance here: the Conference Board’s Leading Economic Index was positive for the eleventh straight month in February.⁴

Snow stalls housing starts. They fell 5.9% last month, according to the Commerce Department. Yet February housing starts and building permits were respectively 0.2% and 11.3% above year-ago levels.⁵

Oil drops, gold gains. Oil futures fell 0.69% across last week to close at $80.68 a barrel on the NYMEX Friday. Gold, however, gained $5.90 last week; even with a $20.00 drop Friday, it ended the five-day stretch at $1,107.40.⁶

Eight-day win streak for the Dow. That streak – the longest since August – helped the index rise 1.10% across last week to 10,741.98. Looking at the other two marquee indices, the S&P 500 gained 0.86% last week while the NASDAQ rose 0.29%.⁷

% Change	Y-T-D	1-Yr Chg	5-Yr Avg	10-Yr Avg
DJIA	+3.01	+45.15	+0.21	+0.06
NASDAQ	+4.64	+60.06	+3.65	-4.85
S&P 500	+4.02	+47.94	-0.50	-2.04
Real Yield	3/19	1 Yr Ago	5 Yrs Ago	10 Yrs Ago
10YrTIPS	1.50%	1.31%	1.77%	4.34%

(Source: CNBC.com, CNNMoney.com, ustreas.gov, bls.gov, 3/19/10)^7,8,9,10

Indices are unmanaged, do not incur fees or expenses, and cannot be

invested into directly. These returns do not include dividends.

___________________________________________________________________

These views are those of Peter Montoya Inc., and not Statler Financial Services, Inc., and should not be construed as investment advice. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is an unmanaged, market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. It is not possible to invest directly in an index. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx^®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world’s largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. All economic and performance data is historical and not indicative of future results. The market indices discussed are unmanaged. Investors cannot invest in unmanaged indices. The publisher is not engaged in rendering legal, accounting or other professional services. If other expert assistance is needed, the reader is advised to engage the services of a competent professional. Please consult your Financial Advisor for further information. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards.

Statler Financial Services, Inc. is registered as an investment adviser with the state of Florida. The presence of this Web site on the Internet shall in no direct or indirect way to be construed or interpreted to suggest Statler Financial Services, Inc. is soliciting to sell advisory services or offering to sell advisory services to residents of any other state other than the state of Florida.

Citations.

1 marketwatch.com/story/story/print?guid=A37FB003-34F9-41A5-83B4-823778033C51 [3/18/10]

2 businessweek.com/news/2010-03-17/producer-prices-in-u-s-dropped-more-than-forecast-update1-.html [3/17/10]

3 marketwatch.com/story/us-feb-industrial-output-up-01-despite-snow-2010-03-15?reflink=MW_news_stmp [3/15/10]

4 dailyfinance.com/story/leading-economic-indicators-rose-again-in-february/19404951/ [3/18/10]

5 latimesblogs.latimes.com/money_co/2010/03/housing-starts-fell-5-point-9-percent-in-february.html [3/19/10]

6 blogs.wsj.com/marketbeat/2010/03/19/data-points-energy-metals-244/ [3/19/10]

7 cnbc.com/id/35952832 [3/19/10]

8 money.cnn.com/quote/historical/historical.html?pg=hi&close_date=3%2F19%2F09&mode=add&symb=DJIA [3/19/10]

8 money.cnn.com/quote/historical/historical.html?pg=hi&close_date=3%2F18%2F05&mode=add&symb=DJIA [3/19/10]

8 money.cnn.com/quote/historical/historical.html?pg=hi&close_date=3%2F20%2F00&mode=add&symb=DJIA [3/19/10]

8 money.cnn.com/quote/historical/historical.html?pg=hi&close_date=3%2F19%2F09&mode=add&symb=COMP [3/19/10]

8 money.cnn.com/quote/historical/historical.html?pg=hi&close_date=3%2F18%2F05&mode=add&symb=COMP [3/19/10]

8 money.cnn.com/quote/historical/historical.html?pg=hi&close_date=3%2F20%2F00&mode=add&symb=COMP [3/19/10]

8 money.cnn.com/quote/historical/historical.html?pg=hi&close_date=3%2F19%2F09&mode=add&symb=SPX [3/19/10]

8 money.cnn.com/quote/historical/historical.html?pg=hi&close_date=3%2F18%2F05&mode=add&symb=SPX [3/19/10]

8 money.cnn.com/quote/historical/historical.html?pg=hi&close_date=3%2F20%2F00&mode=add&symb=SPX [3/19/10]

9 ustreas.gov/offices/domestic-finance/debt-management/interest-rate/real_yield.shtml [3/19/10]

9 ustreas.gov/offices/domestic-finance/debt-management/interest-rate/real_yield_historical.shtml [3/19/10]

10 treasurydirect.gov/instit/annceresult/press/preanre/2000/ofm11200.pdf [1/12/00]