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| Shoreline Wealth & Investment Management |
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Newsletter
February 2005 |
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The Stock & Bond Markets -
First the good news: after recording the worst beginning of a year in the past 14, the stock and bond markets recovered some of their early losses. As of this writing, the S&P 500 is down about 1%, the NASDAQ is down about 4% and the bond market is relatively flat.
As for the disturbing news, a few more big/respected names have gone public with their concerns for the economy, the dollar and our current fiscal policies. In 2004, Warren Buffet and Alan Greenspan warned about the spiraling budget and trade deficits with Buffet taking a $12 billion bet (which turned out to be very profitable) against the U.S. dollar. His buddy Bill Gates, the only person richer than Buffet, has followed his lead and similarly bet a huge amount against the U.S. dollar calling the current situation "scary." And Bill Gross, manager of the world's largest bond fund, suggested the current plan to overhaul Social Security lacked economic credibility and was a "joke" compared to resolving the twin deficits. If you like betting with the house, believe that it's no accident some people seem to always be on the winning side of economic transactions and that following the money is better than the latest sound bite from another talking head, then this might be a time to consider spreading your risk by owning foreign securities and currencies.
CELEBRATING 25 YEARS
Since 1980, I have been providing financial advice to investors and I'm proud to say that our service and performance (see "Bottom Line" section on the right) continue to be superior to the market and our peers. Thanks for your support.
Real Estate Bubble? -
Santa Barbara was just listed as the "least-affordable" housing market in the U.S. based on a formula that compares median housing prices to median income. According to the Nathional Association of Home Builders, the median price of a Santa Barbara home was $668,750 while the median household income was $64,700. The implication is that it takes more than 10 years of income to buy a home. In Lima, Ohio (I'm aware homeowners there wake up in Ohio but stay with me), the median household income was $52,500 and the median home price was $82,000 meaning it only takes 1 1/2 years of income to pay for that home. Of course prices along both coasts are higher than the heartland due, not just to desireablity, but to economic opportunity. However, the two coasts have had percentage appreciations far in excess of other areas and, to quote Bill Gross, "if something can't go on forever, it won't."
| Selecting an Advisor |
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 Warren Buffet, the most successful investor of the 20th century learned his craft from Benjamin Graham, author of several books including the legendary "Intelligent Investor." This has been recently updated by Jason Zweig who includes 16 key questions to ask your advisor and 11 an advisor might ask...
Read on... »
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| Coverdell Education Savings Account |
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 Formerly known as the Educational IRA, this is an ideal savings plan for parents, grandparents, relatives or friends who wish to start an investment program to meet a child's future needs.
Full Story »
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| Living Trusts: Disinheriting Uncle Sam |
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 Last month, we discussed the importance of having a will, the first line of defense in protecting your assets in upon death. A more sophisticated strateg includes establishing a living trust.
Learn More »
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| Looking for a Speaker for Your Event? |
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 Shoreline Wealth & Investment Management has given presentations to Fortune 500 companies as well as many local groups and organizations. If you are looking for a professional presentation on topics ranging from investments to estate taxes to business or tax law, please contact us
Click here for more details »
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| The Bottom Line |
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| This is where we provide the performance of our conservative, moderate and aggressive portfolios and compare these to the S&P 500 and NASDAQ Indexes. While they are an important consideration, performance is only a portion of the evaluation investors should consider when evaluating investment management. Other considerations include the risk taken to generate the returns, the quality of the service, the reasonableness of the fees and, more important now than ever, the integrity of the investment manager.
Find out more.... |
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email: cbloom@cfiemail.com
voice: 805.886.3624
web: http://www.swimllc.com/
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Shoreline Wealth & Investment Management · 3905 State Street Suite 7173 · Santa Barbara · CA · 93105
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