Annual Meeting

The first week of corporate earnings is here and the investing environment has turned around. It appears that all of the noise of Europe is in the background and the focus is on corporate earnings which appear to be coming in about as expected. The first annual meeting occured past Thursday night and the bullet points from the meeting are shown.

Vanguard

Retail sales grew faster than expected in September as the Federal Open Market Committee (FOMC) minutes showed considerable debate about what the Fed should do next to help the economy out of its funk. For the week ending October 14, the S&P 500 Index rose 6% to 1,225 (for a year-to-date total return—including price change plus dividends—of about –2.74%). The yield on the 10-year U.S. Treasury note increased 16 basis points to 2.26% (for a year-to-date decrease of 104 basis points).

Annual Meeting Bullet Points

1) Business Cycle: The US economy remains in a recovery mode, not in a growth mode.
2) Investment Cycle: The cycle has shifted to being favorable to stocks and when stocks reach the July high the accounts that purchased stocks will be asked to be sell stocks and get back to the previous position.
3) Retirement Environment: People need to continually invest in retirement accounts due to future reductions in Social Security, Medicare, and government pension funds.
4) Cheapest Investment Today: US Stocks, bonds and gold are expensive.
5) Greece/Europe: This is a minor story as Europe has to solve it to keep the European Union together.
6) Current Concerns: Legislation involving the Volker Rule and the impact on banks and the Yuan Bill impacting the relationship with China.
7) Housing and Banks: Banks are not the cause of the housing mess rather government policy.
8) Timing to buy Real Estate: Now is a great time to refinance a mortgage and for many people now is a great time to buy real estate due to improving economic conditions and having mortgage rates at historically low levels.
9) Obama Care: Medicare reimbursements to health providers are starting to be reduced because of it. This means that individuals will be paying more in the future so it would be prudent to keep contributing to a retirement account.
10) Investing in the Short Term: Take advantage of the Investment Cycle.
11) Investing Strategy: Long term time horizon with decisions based upon value of possible asset choices.