First the Good news�..
I
am very pleased to announce the addition of another financial planner
to our team at Asset Planning, Inc. Diane, Carol and I welcome Beverly
Cox to the staff. I have known Bev for several years as we have played
golf together. We have also worked on several projects together over
the last year. Our philosophies about financial planning and
investments are similar and I am sure she will be a great addition. Bev
brings fifteen years of experience to the firm. Her bio is posted on
our web site.
In local events, I should be featured in the LA
Times on Tuesday, October 15 in a new �money makeover� column. I just
finished another �One on One� for the OC Register (copy enclosed) and
was quoted on the front page of the OC Register following the latest
fed rate cut. I remain on a panel of experts for their mutual fund
quarterly review, published on 9/30/01. This keeps me on my toes!
And then the Bad news�.
This
has been a quarter like no other ever experienced by the American
people. We are at war due to an attack on our own land. It still seems
unbelievable and incomprehensible.
Where is our economy now?
When people and businesses stopped buying new items, companies stop
ordering parts and supplies for products and let their supply or
surplus inventory be sold without replacing it. When companies are not
producing at the same level as before, due to lower projected sales,
layoffs of workers and cut back on expenses occur. This is the scenario
that we have all seen since the beginning of the year.
The
stock market values the price of stocks by looking to future earnings
and sales of a company and tries to determine what it will be worth.
When the market saw the earnings potential of companies being reduced,
it lowered the prices of the stocks through sales until the current
estimates equaled the value of the stock. In short, the market declined
and was staying that way since there was no good news on the horizon.
For the first time in several months, I was seeing positive signs
coming from the manufacturing sector. In the days surrounding the
attack, numbers were released that showed manufacturing orders were
increasing as companies began placing new orders. This meant that
things were picking up. This could have been just what was needed for
the market to look forward to increased sales, thus rising stock
prices.
Then the attacks came and America virtually stood
still for several days trying to comprehend what had happened. In this
aftermath of human and business destruction, we find damage to the
economy. The travel, insurance and leisure industries were hard hit.
The layoffs from these industries will continue until Americans go back
to flying and traveling as we did before. This will only come when we
feel safe to do so. I know we will never feel as safe as we did before
the attacks, but we will return to our way of life as we knew it. In
time, we will resume taking vacations and going to conferences and
doing business as we did.
I met with clients in the weeks
following the attacks and one theme stood out in each meeting. They
felt guilty for worrying about their portfolios when human lives had
been lost. Some clients emailed me to see how I was doing, giving me
support. Some brought in checks to deposit to their accounts, wanting
to support the market by purchasing, instead of selling, stocks in
uncertain times. We displayed our flags, lit candles and cried together
to get through these past weeks. I miss my dad more and wish he were
here to tell me more stories about how he fought twice as a Marine for
our American freedom, many years ago. I watch our Armed Forces ready to
fight a new war, knowing action must be taken.
How the market
will react is still an unknown. I am encouraged by the markets behavior
in the last week, with most stocks and funds rising. Historically, the
stock market recovers well following major events such as this. Some
portfolios saw their values rise 5 to 7% in the week following the
quarter end. I continue to monitor the funds very closely and stay in
contact with the fund managers. We do have the strongest economy in the
world and America is the greatest Nation. We will recover and prosper
in 2002.
Please call if you have questions or wish to schedule a meeting.
God Bless,
Sandra C. Field, CSA, MBA, CFP