Macro View Unchanged

We have made no changes in our portfolio this quarter to date. The S&P 890 target remains, 22 percent below current levels.  The indicators we watch still point to lower stock and commodity prices.  Both the important dollar / gold ratio and T-Bond action point to lower stock levels to find value at this point in the macro cycle. With the Goldman Sachs settlement behind us we have lowered our downside target to 103 from the earlier 117 objective as their operations adjust to the new financial regulatory environment.

The China ETF, FXI continue to trace out the downward pattern from its peak last October.  How much could the emerging markets know about projecting exports to the US when the US private sector sees no upturn yet.  More has to be done on the domestic economic front, probably on some reduced tax policy tied to new employment, maybe something like a retroactive tax reduction based on 3 year net increases in employment.