2009 Mid-Year Review

With the first half of 2009 behind us, I'd like to take a look at what has happened and speculate about what we might expect for the second half of the year.

First, looking at the financial markets, we can take stock in the fact that the markets are still way off their October 2007 highs. The DOW industrials remain down over 40%, the S&P 500 is off by 42% and the NASDAQ composite down 36%. Virtually no sector was spared in the Stock Market Carnage of 2008. How has the markets fared year-to-date through the end of June? The DOW is down 3.75% but the S&P 500 and the NASDAQ are up 1.1% and 16.3%, respectively. Some say they are sniffing the beginnings of a bull market these days. Which way will the markets go? Honestly, I've never been more uncertain about the direction of the markets than I am right now. Clearly, at these price levels, there are strong arguments to start accumulating shares in solid, reliable companies. On the other hand, there are great arguments that say the worst is yet to come. Job losses could lead to more mortgage defaults. Credit is hard to come by. Businesses are not growing and they are not hiring. The macro economy remains fraught with uncertainty. From an investment standpoint, the financial markets hate uncertainty.

Where does all this leave the average investor? I believe there are opportunities in ANY market, as long as you know where to find them. I also strongly believe that buy-and-hold investing is dead for the foreseeable future. If your stock broker was unable to tell you that October 2007 was the top of the market and you should sell to lock in your gains, how do they know that this is the bottom? If you are worried about the volatility in the markets, or you just can't afford to lose any more money, there are safe places of refuge you can run to in troubled times. At CFS, we specialize in safe investment strategies. We have access to asset classes that don't derive their values from the gyrations of a fickle stock market. We can safely craft a portfolio which can deliver needed cash flow with double-digit returns outside of the stock market. Call CFS today so we can honestly and objectively evaluate your holdings and get you in a position to succeed.