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| Shoreline Wealth & Investment Management |
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Newsletter
July 2005 |
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The Stock & Bond Markets -
With oil prices approaching $60 per barrel, long-term bonds have been rallying in anticipation that higher energy prices will slow economic growth and that interest rate increases have run their course. Stocks have also been performing well the past 6 weeks after declining 3 out of the first 4 months to begin the year.
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? -
According to a recent New York Times article, Americans are making a $1 trillion bet on unending real estate appreciation. The bet is in the form of a willingness to assume increasing payments over time in the belief that home appreciation will more than pay for increase monthly payments. Here's how it works:
Buyers are taking interest-only loans with substantially lower payments required up front. After the "grace" period, they not only have to make principal payments but increasing interest payments as well if rates go up. In 2005, only about $80 billion in loans are affected by this structure but the number will increas to $1 trillion by 2007 according to Deutsche Bank in New York. If individuals can't make the payment, then they will have to sell the homes or give them back to the bank. Should this result in increased supply, as Economics 101 teaches, that will result in lower prices. Of course, real estate has been defying gravity (and logic) for years and may continue to do so. Quite confusing to those of us who use value models to make investment decisions.
| 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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| Understanding Bond Investing |
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 Bonds were the number one asset category in 2000, 2001 and 2002. This was due to a "flight to quality" from stocks as the dot-com boom crumbled as well as interest rates declining to the lowest level in 45 years. While rates jumped in the past year and a half, they appear to have leveled off and even dropped a bit below. Conflicting economic data will keep rates in a trading range and bonds do pay a 400% premium to just leaving excess cash in money market accounts or CDs.
Full Story »
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| Offshore Trusts: Disinheriting Uncle Sam |
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 As a well-established asset protection strategy, "offshore" trusts provide protection for your assets and may also be the right vehicle to use to diversify your portfolio by investing internationally.
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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