Archive for the ‘The Market’ Category
Monday, September 12th, 2011
September 5, 2011
To Our Valued Clients and Friends,
Welcome back.
Labor Day marks the end of the summer season (even though Autumn does not officially begin until September 23rd). Kids go back to school, or off to college. The baseball season enters its final days, and the football season kicks in. Everyone comes back from vacation, and the pace of life picks up. The weather turns cooler (except that I am predicting a very hot Indian summer here in the Bay Area); swim suits get put away and sweaters and jackets begin to appear.
It has been a full summer for the Starmont community. People got married; people got divorced. Babies were born and others were conceived and are cooking for delivery in other seasons. No one in the Starmont community died, but we have had deaths in the past and expect them in the future. People went away—on trips across the United States; to Canada, Mexico, South America, Europe, Asia and the Pacific. People stayed home and had staycations. Body and soul were nourished and made ready for whatever is to come.
During the summer the global economy slowed and the U.S. debt rating was lowered from AAA to AA+ for the first time in history. (more…)
Tags: asset management, Congress, Harvey Rowen, market performance, Portfolio Management, Starmont, Wealth Management
Posted in Blog, Client Communications, The Market | No Comments »
Friday, August 19th, 2011
August 4, 2011
To Our Valued Clients,
Global equity markets were pretty ugly today. But since you have a diversified portfolio and bonds are holding their own, and since many of you raised cash in advance of the debt ceiling vote, you did not do nearly as badly as the Dow being down 500 points today would lead you to believe.
Indeed, if you have a portfolio that is 20% in domestic stocks, 12.5% in developed international stocks, 12.5% in emerging markets stocks, 45% in bonds and 10% in cash, your portfolio is down around 2.4% for the day. Not a great day, but not down the 5% represented by the Dow decline.
Why the sell off?
(more…)
Tags: Debt Ceiling, economic outlook, equity allocations, Harvey Rowen, market performance, Starmont, Stock Market
Posted in Blog, Client Communications, The Market | No Comments »
Tuesday, July 19th, 2011
To Our Valued Clients,
We sent to you a week ago an e-mail that included a discussion of what is going on with the debt ceiling legislation under a heading that read, “July Could Be A Volatile Month-Buckle Up.” If you didn’t have a chance to read it, here is a link: http://www.starmont.com/2011/07/market-and-debt-ceiling-update/
Where Are We Now?
The date at which the United States Treasury runs out of cash and could start defaulting on the payment of principal and interest on Treasury bills, notes and bonds is only 15 days away.
No resolution is in sight from the White House and Congress, although there are numerous plans being floated in Washington.
Stock and bond markets have been rather blasé about this until today, when the Dow closed down around 100 points. As the drop dead date of August 2nd gets closer with no resolution, we expect increased volatility in the markets.
Ask just about anyone in the investments business why there has been little interest in this topic and they will say, “It’s all a bunch of political posturing, and by August 2nd they will have raised the debt ceiling.”
Maybe. But maybe not.
And the consequences of Maybe Not could be severe.
We are only speculating, since the United States has never defaulted on its debt in its over 200 year history as a country. But here is what could happen:
(more…)
Tags: asset management, Bonds, Congress, Debt Ceiling, economic outlook, Harvey Rowen, Investments, market performance, Portfolio Management, Starmont, Wealth Management
Posted in Blog, Client Communications, The Market | No Comments »
Monday, July 18th, 2011
Starmont’s Harvey Rowen and Christine Benz of Morningstar, were quoted by the Associated Press regarding the Debt Ceiling, Congress and Client portfolios.
Click here to see Mark Jewel’s July 14, 2011 article, “7 tips for rebalancing your fund portfolio now” on MSN.Money.com
Tags: asset management, Congress, Debt Ceiling, economic outlook, equity allocations, Harvey Rowen, Investments, Portfolio Management, Starmont, Stock Market, Wealth Management
Posted in Blog, Starmont In The News, The Market | No Comments »
Monday, July 11th, 2011
To Our Valued Clients and Friends
June started out badly, but rallied at the end of the month and closed only moderately down for the month. (Markets were down for the month, but are up for the year. See below).
The major U.S. stock indexes were down from 1% to 2.5% for the month. The EAFE index (Developed International Markets) was down 1.2%, and the iShares EEM (Emerging International Markets) was down 0.94%. For the year through June 30th, all major domestic and international stock indexes are up, from 8.6% for the DJIA and Russell 2000 (domestic small cap) Growth; to 0.91% for the iShares EEM.
Domestic and international bond indexes were negative for the month, with the Barclays Capital U.S. Aggregate Bond Index down 0.45% and the Barclays Capital Global Treasury Ex-US Index down 0.01%. For the year through June 30th these indexes are positive.
Commodities and REITs, both domestic and international, were negative in June, and the commodity index has gone negative for the year.
All Starmont Client portfolios are positive for 2011 through June 30th—with the amount dependent on how their assets are allocated among the various asset groups. So far in 2011 the higher the allocation to equities, the better the portfolio performance. Your First Half Reports will be sent to you later in the month.
July Could Be A Volatile Month—Buckle Up!
(more…)
Tags: asset management, Bonds, Congress, economic outlook, Economy, Harvey Rowen, Interest Rates, Investments, Portfolio Management, U.S. economy, Wealth Management
Posted in Blog, Client Communications, The Market | 1 Comment »
Tuesday, July 5th, 2011
Click on the link below to see Harvey Rowen on MarketWatch.com discuss the dangers if Congress does not pass the legislation raising the debt ceiling this month.
US Knocking At Debt’s Door
Tags: asset management, Congress, equity allocations, Harvey Rowen, Interest Rates, Investments, market performance, MarketWatch.com, Starmont, Stock Market, Stocks, Wealth Management
Posted in Blog, Starmont In The News, The Market | No Comments »
Tuesday, June 21st, 2011
May was a down month. Global stock market indexes were down–from 1.1% (the S&P 500 index and the Russell 1000 Index–domestic large cap stocks) to 3.2% (EEM Index–emerging markets).
Global REIT indexes (commercial real estate) also were down, as was the commodities index.
Domestic and international bond indexes were mixed, with the Barclays Capital U.S. Aggregate Bond Index up 1.3% and the JP Morgan GBI Global Bond Index down 1.2%.
However, when we evaluate the first five months of 2011 as a whole, we see that all indexes are positive for 2011 through May 31st, with the domestic stock indexes up around 6%; the international stock indexes up around 4%; and the domestic and international bond indexes up around 4%.
All Starmont Client accounts are positive for 2011 through May 31st—with the amount dependent on how their assets are allocated among the various asset groups. So far in 2011 the higher the allocation to equities, the better the portfolio performance.
The first six trading days in June have continued the negative trend from May. Some analysts have described what is happening as a “soft patch” in the economy; others have said that the U.S. economy has “hit a brick wall.” Some economists are revising their estimate of 2011 GDP in the United States to 2.0-2.5% from previous estimates of 3.0-3.5%GDP of 2% is not enough to create jobs and grow the economy at a sustainable rate.
Starmont has received a number of questions about the situation, and we thought that we would share those questions and our responses with you.
(more…)
Tags: asset management, economic outlook, equity allocations, Harvey Rowen, market performance, Starmont, Stock Market, Stocks, Wealth Management
Posted in Blog, Client Communications, Messages to Starmont Clients, The Market | No Comments »
Tuesday, May 3rd, 2011
1st Quarter Summary
The equity rally of the last three months of 2010 carried over into the first two months of 2011. Then the earthquake, tsunami and nuclear problem in Japan, and the events in North Africa and the Middle East stalled the market in early March. This was followed by significant drops in mid March, and then a recovery in late March. This created a mostly flat month for the domestic equity market, a down month for the developed international market, and an up month for the emerging international market. We expect global equity markets to behave like this more often than not going forward given all that is happening in the world at the present time.
(more…)
Tags: asset management, Bonds, economic outlook, equity allocations, Harvey Rowen, investment, market performance, Starmont, Stock Market
Posted in Blog, Client Communications, Messages to Starmont Clients, The Market | No Comments »
Friday, March 18th, 2011
Is the Stock Market Getting Its Mojo Back?: Find Out Why 2011 Could Be the Inflection Year for the Stock Market
After a decade of the stock market underperforming historical norms, the economic winds seem to have changed. 2011 may be the year that the stock market returns to its historical long-term performance. At Starmont we have been increasing the equity allocation in most of our Clients’ portfolios. Harvey Rowen, Starmont’s CEO and Chief Investment Officer, discusses the thinking behind this strategy and answers frequently asked questions on topics like the next correction, buying gold and the outlook for bonds.
Click Here To View Slides
Tags: asset management, Bonds, equity allocations, Harvey Rowen, Starmont, Stock Market Performance
Posted in Blog, Client Communications, Messages to Starmont Clients, The Market | No Comments »
Thursday, September 2nd, 2010
Americans are facing a large tax increase in 2011 unless Congress enacts legislation to prevent it. There appear to be three windows of opportunity for Congress to act:
- 1. When they come back in session after Labor Day and before they go away for the elections in November;
- 2. In a lame duck session after the elections and before this Congress adjourns;
- 3. Next year after the new Congress convenes in January, if it were to pass legislation retroactive to
January 1, 2011.
Our view is that nothing will get done by this Congress this year (indeed, so many incumbents are likely to get defeated in November that they may decide not to have a lame duck session, and the chances of anything except talk happening before the election seems remote in our view).
If we are correct, then on January 1, 2011, the following happens:
- - Income tax rates go up for everyone, with the top bracket going from 35% to 39.6%
- - Long term capital gains tax rates go to 20% from the current 15%
- - Taxes on dividends go from the current 15% to 36.9%
- - Estate taxes are re-imposed at 55% with a $1 million per person exemption compared to the 2009 rate of 45% with a $3.5 million per person exemption (there is no estate tax in the United States in 2010)
Thus you may want to meet with your tax advisor to discuss the following:
- - Should you accelerate income into 2010 and defer deductions to 2011 (the reverse of the usual advice)?
- - Should you take more than your required minimum deduction from your tax-deferred account(s) in 2010, paying at the lower 2010 income tax rate and lessening the amount in those accounts that will be withdrawn in later years at higher income tax rates?
- - If you are younger than 70 years and 6 months and older than 59 years and 6 months, should you take money out of your IRA account for the same reason?
- - Should you convert some or all of your IRA money into a Roth IRA for the same reason?
- - Should you take capital gains in your taxable account(s) before December 31st in order to take capital gains at this year’s lower rate?
- - Do you need to make any changes to your estate plan in light of the significantly lower exemption ($2 million per couple vs. $7 million per couple in 2009) and the higher estate tax rate?
For Starmont clients, we would be happy to be part of those conversations, either in person or by phone.
Tags: capital gains, Congress, Estate Taxes, Legislation, Starmont, Taxes
Posted in Blog, Messages to Starmont Clients, The Market | No Comments »
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