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| For the Week of March 1, 2010 The Market The Dow and the S&P ended February with their best gains since November, climbing 2.6 percent and 2.9 percent respectively, while the NASDAQ had its best month since December, gaining 4.2 percent. All three indexes had small declines for the week, however, as existing home sales recorded an unexpected drop in January and consumer sentiment fell in February. Those signs of the economy’s ongoing struggle to recover were offset slightly by a revised gross domestic product report from the Commerce Department, which showed the economy grew at a 5.9 percent annualized rate in the fourth quarter, compared to the 5.7 percent pace previously reported. For the week, the Dow lost 0.69 percent to close at 10,325.26. The S&P fell 0.37 percent to finish at 1,104.49, and the NASDAQ declined 0.25 percent to end the week at 2,238.26.
Source: Morningstar.com. *Past performance is no guarantee of future results. Indexes are unmanaged and cannot be invested into directly. Three- and five-year returns are annualized. The S&P, excluding “1 Week” returns, is a reflection of return to an investor, by reinvesting dividends after the deduction of withholding tax. Paper or Plastic? – Over the 25 years from Dec. 31, 1983, to Dec. 31, 2008, outstanding credit card balances in the U.S. grew by 10.5 percent per year, reaching $957 billion. From the end of 2008 to the end of 2009, outstanding credit card balances fell by 9.5 percent to $866 billion. The government has tracked credit card data since 1968. Last year’s drop in the outstanding credit card balances nationwide was the first time ever that the year-over-year change was negative (Source: Federal Reserve, BTN Research). We Are Saving More – The national personal savings rate in the U.S. was 4.6 percent as of Dec. 31, 2009, the highest year-end rate since Dec. 31, 1996. As recently as March 31, 2008, the national personal savings rate was 1.2 percent. As of Dec. 31, 1984 (i.e., 25 years ago), the rate was 10.4 percent (Source: Bureau of Economic Analysis, BTN Research). In the Business of Health – The five largest U.S. health insurance companies had combined profits in 2009 of $12.2 billion, up from $7.8 billion of profits in 2008 (Source: Health Care for America Now, BTN Research). WEEKLY FOCUS – Identity Theft: Deter, Detect, Defend The Federal Trade Commission (FTC) reported last week that for the first time since it started tracking identity theft a decade ago, the number of complaints it received dropped in 2009. Even with a 10 percent decline, however, the FTC still logged 278,078 reports of identity theft. Other types of fraud jumped by 24 percent in 2009, possibly due to the economy. Debt collection fraud topped the “other” list, accounting for nearly 10 percent of all complaints. Reports of credit card fraud more than tripled in 2009. These numbers reflect only consumers who self-reported the fraud to the FTC. Of all fraud complaints reported, nearly half (48 percent) of victims say their first contact with the perpetrator came through the Internet, with another 12 percent making contact through a website and 10 percent through a phone call. The FTC recommends that consumers use an approach of deter, detect and defend. Deter identity theft by safeguarding your Social Security number and other personal information, shredding financial documents, deleting unsolicited emails and avoiding easy-to-guess computer passwords. Detect identity theft by watching for unexpected account statements or bills that do not arrive as expected, denials of credit for no apparent reason, and calls or letters about purchases you did not make. Monitor your credit card report and your financial statements closely. Defend against identity theft as soon as you suspect it by placing a fraud alert on your credit reports, closing any accounts that may be at risk, filing a police report and reporting the incident to the FTC. Protecting your personal information is important to us. We will never send confidential information such as account numbers, balances or statements to you by email. Once your account has been opened, we should never need to ask for your Social Security number by phone. If you ever doubt that a person claiming to represent our firm actually does work for us, please don’t hesitate to end the call and then call our office directly to verify. We’re your partner in ensuring only you have access to the assets you’ve working so hard to attain. * The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. NASDAQ Composite Index is an unmanaged, market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Morgan Stanley Capital International Europe, Australia and Far East Index (MSCI EAFE Index) is a widely recognized benchmark of non-U.S. stock markets. It is an unmanaged index composed of a sample of companies representative of the market structure of 20 European and Pacific Basin countries and includes reinvestment of all dividends. Barclays Capital Aggregate Bond Index is an unmanaged index comprised of U.S. investment-grade, fixed-rate bond market securities, including government, government agency, corporate and mortgage-backed securities between one and 10 years. Written by Securities America. SAI# 303418 We also encourage you to forward this Weekly Market Commentary to anyone you think might be interested in this information. |
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