Summer Update

These last several months have been full of differing views depending on which media outlets you watch or read. What is most interesting is how most investment professionals lack the quality of being open-minded and believe their opinion to be the only truth. In fact, many follow a herd mentality and anchor on their beliefs to be the only view and will go to any length to prove their point. Recently, I have read some suggestions that our Government along with Wall Street and the Banks have a conspiracy to lie about the state of our economy for their own gain. I would assert that if this conspiracy were to really exist (I doubt that it really does) it is really in the best interest of our people. Many managers have very short memories and tend to forget where we were last October. After the failure of Lehman, AIG and Merrill Lynch were next on the chopping block. If it weren’t for the foresight of Mr. Bernake and Mr. Paulson, we might have had a systematic failure. It is always nice to criticize after that fact but without the intervention, our markets would have failed. There are still many risks that still exist such as the mortgage resets and rising levels of housing inventories. Also, the labor markets are far from being rosy which really impacts the consumer but there is a turn in many leading indicators. The credit markets are the first place to look to see if we are still repairing after the shock we incurred. Spreads continue to narrow in the corporate debt markets and with many securitized products, although some would argue that it is due to the stimulus from our Treasury and Fed. Either way, there is substantial improvement in our credit markets from where we were just a year ago. As the economy improves, so will our stock market and confidence will return to both the consumer and our corporations.