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Are You Missing the Obvious?

For Immediate Release
June 23, 2010

It's possible that you're focusing so intently on a few aspects of what's going on in the world, that you're missing the obvious … you’re ignoring the gorilla in the room.  The video and test results show how we can be susceptible to missing the obvious.

During the video, a guy in a gorilla suit wanders by, pounds his chest, and wanders off. Later, when asked about what they saw, only half the students said they saw the gorilla. The other half were watching the ball so intently, they never saw the gorilla! Are you making this same mistake? It’s possible that you’re focusing so intently on a few aspects of what’s going on in the world, that you’re missing the gorilla. The Gulf oil disaster, problems in Europe, our own debt and political debates — it all could be making you reach a conclusion about your investments without considering vital information!  Such as the recent 2010 economic news like…  

• Inflation has fallen to a five month low, according to the Economic Cycle Research Institute.
• In June, the Euro reached its lowest level since March of 2006, according to BusinessWeek.
• U.S. car sales jumped 19% in May, according to Autodata Corp.
• The Organization for Economic Cooperation and Development raised its outlook for the United States, China, Japan and the Euro, noting “there’s objective reasons to be positive about the outlook,” The New York Times reported.
• Walmart announced they are preparing for 20 years of worldwide growth and planning to hire half a million people over the next five years.
• The core Consumer Price Index, which excludes energy and food, is at a 44-year low, according to the Department of Labor.
• In the first quarter, 80% of the companies in the S&P 500 beat profit expectations, according to The Wall Street Journal.
• The free cash flow of the companies in the S&P 500 is near a two-decade high, The Wall Street Journal reports.
• Microsoft, Google, Cisco, Apple and Intel have enough cash on hand to pay the entire debt of Greece, The Wall Street Journal says.
• The Federal Reserve is projecting 3% growth this year.
• In April, the Architectural Billings Index* hit its highest level since August 2008.
• Chrysler has announced 1,100 new jobs in May.
• Intel’s first quarter revenue jumped 44% over one year ago, and operating income quadrupled; it was the company’s best quarter since it was founded in 1968.
• The CEO of General Electric recently told investors, “We feel pretty good about where we’re positioned as the recovery continues,” according to The New York Times.
• Bank of America reported earnings of over $3 billion in the first three months of this year.
• The U.S. Treasury says the cost of the Troubled Asset Relief Program will cost taxpayers substantially less than originally predicted.
• A study released in April by Spectrem, an employee benefits consulting firm, found that retirement accounts have recovered nearly all the losses incurred during the recession.
• Delinquencies on home mortgages have fallen for the first time since 2006, according to USA Today.
• 80% of portfolio managers recently surveyed say they expect the U.S. stock market to rise in 2010, according to a Russell Investments survey released in January.
• In February, we had the strongest gain in home sales, over 8% gain, since October of 2001, according to the National Association of Realtors .
• The World Trade Organization expects global economic trade to grow 9.5% this year.
• The National Association of Business Economics predicts the economy will grow more than 3% this year and next, and that businesses will add 100,000 jobs a month by year-end.
• A March survey by Bloomberg of U.S. CEOs found that executives are boosting their earnings estimates at the fastest rate in at least eight years.
• Non-financial companies have a record $2 trillion in cash, according to the Federal Reserve. The cash will be used to increase dividends — 284 companies have done so already this year — and expand business or acquire other businesses — all of which will help boost the economy.
• A survey completed in March by Duke University and CFO magazine says corporate spending will grow 9% over the next 12 months.
• 83% of the 555 large companies polled earlier this year by human resources consulting firm Hewitt Associates, are planning to award raises.
• The U.S. household savings rate is now 3.6%, higher than it’s been in years, according to the U.S. Commerce Department’s Bureau of Economic Analysis.
• Homeowners added $1 trillion in home equity in 2009, according to the Federal Reserve.
• The Treasury Department announced that it made a $6.2 billion profit selling its stake in Citigroup and another $1.5 billion profit selling warrants in Bank of America. The Treasury Department also indicated that it collected $1.2 billion in fees by insuring money market funds during the credit crisis.
• Between now and 2018, there will be more than 14 million new jobs created but only 9 million new workers available to fill the jobs because so many boomers will be retiring, according to a research report  from Northeastern University released this spring.
• Wages and salaries are up 3% compared to one year ago, according to March research released by TrimTabs Investment Research. Online job postings are up 9%, year over year and 18% year to date.
• Over the next 10 years, China and India will add over 300 million new consumers to the middle class, according to McKinsey Global Institute and CIA World Factbook data .

So don’t be misled by the doom and gloom the media tends to highlight.  Stay focused on your financial goals.  Contact us to talk to a Financial Advisor and let us help you to understand the big picture, what it means for your investments and how to get on track toward achieving your financial goals.



Any information or data provided in this message has been obtained from sources we believe to be reliable, but we do not guarantee its accuracy or completeness. Such information reflects current market conditions, is subject to change without notice. 

*The index, one of the architecture profession’s leading economic indicators, reflects a nine- to 12-month lag time between architectural billings and construction spending. The American Institute of Architects produces the index based on surveys sent to architecture firms. An Index is a portfolio of specific securities (common examples are the S&P, DJIA, NASDAQ), the performance of which is often used as a benchmark in judging the relative performance of certain asset classes. Indexes are unmanaged portfolios and investors cannot invest directly in an index.