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"Always plan ahead.
It wasn't raining when Noah built the ark"
~ Richard C. Cushing
The Markets
In
last week’s newsletter we wondered, “it remains
to be seen whether we will see a “Santa Claus Rally” this
year.” Well, it looks like Santa handed out a few
stocking stuffers early.
For the week just ended, the Dow gained
+3.0%, the S&P
500 +2.8%, the Nasdaq +2.5% and the
Russell 2000 +1.7%. The rally wiped the gloom off one of
the ugliest Novembers ever despite continued bad news in
the background.
For instance, late yesterday came news
that Florida has frozen withdrawals from from its local government
fund, which
has only $15 billion left after investors have withdrawn
$10 billion in recent weeks on concerns over the fund’s
losses from exposure to mortgage-backed securities.
This morning
it was reported that consumer income adjusted for inflation
declined in October, while consumer spending
was flat.
But that kind of information has been overshadowed
by Ben Bernanke’s remarks hinting that the Fed will
cut interest rates again at its next FOMC meeting.
The next
week will be all about "how much is the Fed
going to cut rates?" and "will that make a substantial
difference?" Friday's jobs report is going to be an
important data point. Also, any additional signs about
how consumer spending is this holiday season will have
a notable impact.
| Returns through 11/30/07 |
1-Week |
Y-T-D |
1-Year |
3-Year |
5-Year |
10-Year |
| Dow Jones Industrials |
3.0 |
7.3 |
9.7 |
8.6 |
8.6 |
5.3 |
| Nasdaq Composite |
2.5 |
10.2 |
10.3 |
8.3 |
12.4 |
5.0 |
| Standard & Poor's 500 |
2.8 |
4.4 |
6.0 |
8.1 |
9.6 |
4.3 |
Source: Yahoo! Finance, Barrons
Past performance is no guarantee of future results. Indices
are unmanaged and cannot be invested into directly. Three-,
5-, and 10-year returns are annualized. Assumes dividends
are not reinvested.
IF YOU’RE CONTEMPLATING A MAJOR HOME RENOVATION, you may be wondering how much of your project costs you will get back when you sell your home. To help industrious homeowners answer that question, Remodeling magazine has for two decades produced an annual “Cost vs. Value” report. You can view it at www.costvsvalue.com.
Based on nearly 3,000 responses to a web-based survey conducted with Specpan and the National Association of Realtors, this year’s report found that due to the housing market slump, the percentage of construction costs recovered is down across all projects compared with last year. That said, however, remodeling is still a pretty good investment. Specifically, two-thirds of this year’s projects are projected to return between 65% and 80% at resale. That means you’ll pay just 20 cents to 35 cents on the dollar for most improvements you make to your home.
As you might expect, what you get back at sale time varies depending on your location, location, location. While the percentage of costs returned in New England and Mid-Atlantic cities has remained fairly constant year to year, in the Pacific region (California, Oregon, and Washington), remodeling costs recouped at resale are 14% higher than the national average.
Interestingly, cities in the southeast and southwest that
are experiencing a building boom fall below the national average when it comes
to recouping home improvement costs. This could be a function of the fact that
because these areas have plenty of new homes lingering on the market and falling
in price, buyers are turning their backs on even the most beautifully renovated
older homes.
As the subprime crisis unfolds and continues to impact the
housing market, it’s worth staying up-to-date on factors that impact your home’s value.
Remember, as with investing, your decision of whether to remodel your home
begins with a careful evaluation of your current circumstances and future goals.
America: The Land of Invention
What do you think is the best invention of 2007?
Ever since Ben Franklin
discovered electricity (and probably before) Americans have been coming up
with ingenious and,
sometimes, wacky inventions. Here are a few of Time Magazine’s
nominations for best invention of 2007. Which do you think
deserves top honors?
The Espresso Book Machine
It doesn’t serve coffee, but it can print a 300-page
paperback, complete with color cover, in just three minutes.
And the book costs just $3. There
will never again be an out-of-print title.
The Bubelle Dress
You’ve heard of a mood ring. This is a mood dress. It uses biometric
sensors and lighting to discern the wearer’s feelings. Then it makes
those feelings visible by changing the color of the dress.
The City Car
The brilliant minds at MIT have invented stackable electric
cars. Once installed, these cars can be checked out—like luggage carts at the airport—and
then returned to any station around a city. They’re five feet long
and can travel up to 55 miles per hour. Look for them in 2011.
The Bio Cell
Can you believe it? They’ve invented a battery that
runs on sugar! Just four 50-milliwatt cells will power your
MP3 player for a while.
If you would like to read more about
these amazing inventions,
just visit the Time/CNN website at www.Time.com.
Best Regards,
P.S. Please feel free to forward
this newsletter to family, friends, or colleagues.
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