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When financial experts using the benefit of 20 x20 hindsight write about this present economic crisis, it’s likely they’ll point to this period of time as the most critical moment of all. It’s a time of shocking disconnects between dismal economic reality and Super Wall Street Hype ... A time of temporary stock market euphoria leading to a major collapse of confidence and stock prices ...And this is the time when prudent investors seeking Financial Freedom, that have courage and good judgment, can seize the opportunity to move into safe havens can protect their assets and steadily increase their account values.

Don’t Think Otherwise: The fundamentals that caused this crisis are only growing worse by the day.

Unemployment is burgeoning — and with nearly 20 million Americans out of work, consumer credit is crashing.

Plus, new housing starts are plummeting. Auto sales are still falling.

You don’t have to be a Harvard MBA or  Columbia economic genius to realize that these fundamentals can only lead to dramatically, decreasing earnings, soaring losses and collapsing stock prices for many months — and perhaps for years — to come. The recent rally on Wall Street is giving sophisticated investors the opportunity to protect themselves and get out of the market at the crest of this fools rally. One of the best moves to make now… with the bear market rally clearly running out of steam to take advantage of an extremely limited window of opportunity to set up an EIA with a very attractive guaranteed 8% income benefit. So, if you would welcome a way to take full advantage of historically high income account growth… You can seize this historic opportunity.  Look at this:  An EIA combination of 3 Indices and Annual Reset starting 10/1/1998… Would have turned $100,000 into $190,000 by 3/30/09.  The accompanying Income Account value would have grown to in excess of $238,000. Meanwhile an equally mixed S&P 500 index, NASDAQ 100, and the Dow Jones Industrial Average Would have produced a loss of approximately ($20,000). 

The Bear Market Rally is ending… The Time for Action is now.

Bob Tonachio is President of Robert James & Associates., His firm
Does Not Charge For Advice… and Consultations Are Always Free.
For Complete Details Call: Kimberly at 1-800-530-5700


Dividend Payments Collapse Is there a Safe Alternative

Recently, JPMorgan Chase said it was cutting its dividend by a whopping 87%. And unfortunately it's just one… in a long string of major companies slashing their payments.  The latest dividend cuts for the S&P 500 index are massive. In the fourth quarter of 2008, companies in the benchmark index announced a record $15.9 billion in dividend cuts. Bad news for those relying on dividends for a source of income… also for those looking for growth.  40% of the gains reported for the S&P have been due to dividends being credited.  Recently we have seen 12 years of gains lost due to declining stock prices.

Over the first 90 days of 2009, 26 companies from the S&P 500 have done away with $16.6 billion in dividend payments. This new record has already been set, and the first quarter of 2009 has not taken its toll... Not even counting the JPMorgan cut! A lot of companies are reducing or suspending their payments in this economic environment. Take a look at what's happening to their underlying businesses: 93% of S&P 500 companies reported sales were down 8.8%, with more than half of the firms losing business during the fourth quarter of 2008...Their operating earnings were the lowest in 16 years ... Overall earnings went negative for the first time in the S&P 500's history! Companies are suffering, and they're cutting dividends to preserve their cash as much as they can.

Get Ready for Inflation… it’s Coming!

Turn on the news or surf the net… Some politician, commentator, or the Fed is talking about deflation. Which we might get a bit of in the first half of the year... But. Instead, the opposite effect is inevitable. One leading indicator is pointing the way to a strong rally in 2009. That indicator is inflation (not deflation). It's coming, and it's going to hit us fast & furious. Due to the trillions of dollars being pumped in to the global financial system... the stage is already set for an inflationary spiral. Don’t be fooled by Gas prices being low, interest rates being practically nothing, and the dollar seeming relatively safe for now. Watch out… When global investors gain confidence (which will be in the near future), the dollar's going to fall fast and your dollars will buy a lot less.

There is an alternative to recoup some of the loses and increase income…

While still available… “The Guaranteed Income Account” tied to an EIA… Will do the job for you! This winning combination will guarantee that you don’t suffer from further loss and at the same time provide a guaranteed minimum rate of 8% compounding on the income account value… No tax until income is taken out. 100% of your money works for you!

Bob Tonachio, CEO of Robert James & Associates, has details about “Guaranteed Lifetime Income Accounts Call 1-800-530-5700 His Firm Charges No Fees for Advise and Consultations are Always Free.

Investors Bail Out In Record Number Due To Lousy Returns

After Years of Lousy Returns and Being Smacked With High Fees & Taxes…
The $10 trillion mutual fund industry is losing its believers at a rapid pace.
Let’s look at the funds that most advisors thought, could never lose as much as they did: Touchstone JSAM Institutional Value, Negative 78%... Touchstone Large Cap Value Negative 75%... Oppenheimer Champion Income Negative 78%... Alpine International Real Estate Negative 70%... Fidelity Select Home Finance Negative 66%.

According to investment researcher Morningstar Inc., "Out of almost 2,100 diversified retail U.S. stock mutual funds that are open to new investors, only 17 have generated positive returns during the past 12 months and year to date." According to a new study by Mass.-based Cogent Research, it was found that seasoned mutual fund investors presently have an average of 40 percent of their portfolios in funds, down from 53 percent in 2006.

The combined assets of the nation's mutual funds decreased by $191 billion, or 2.0 percent, to $9.411 trillion in January, according to the Investment Company Institute's official survey of the mutual fund industry.

"Funds are still going to have difficult periods to go through," before things turn around, said Tom Roseen, senior analyst at Lipper. "We might not start seeing some people returning by next summer." Mutual funds have been whacked by a combination of falling asset values and redemptions. Average total returns of all stock funds, U.S. and international, are down 50% this year, causing the fall in asset values. "Bond funds just got crushed," in October, said Roseen, who added that much of the outflows were from investors leaving intermediate investment-grade debt. "People just don't trust the ratings for these things any more," he said.

Mutual funds are plummeting each year while taxes and high fees reduce return on investment (ROI). Want a hedge against inflation? Better look elsewhere!

Taxes took the largest bite ever out of taxable mutual funds in 2007, setting a new high. For the 2007 tax year, more than $24 billion — the highest capital gains tax billed by the IRS in stock market history — stunned mutual funds holders, according to fund research company Lipper Inc.

Since substandard performance is presently the norm in mutual funds, and recent tax-break laws will sunset in 2010, it would be prudent for investors with taxable mutual funds to reduce the two main drags on their performance – high fees and taxes.

"The economic downturn is accelerating a continuing move from mutual funds to alternative products, says Christy White, a principal at Cogent

Knowledgeable advisors should have been advising their buy-and-hold mutual fund clients with huge mutual fund losses… to move their fund assets and take advantage of the new bright star on the alternative investment horizon, a “Guaranteed Lifetime Income benefit”; attached to an EIA… Clients would have had guarantees against loss and elimination of a duplication of fees and tax liability.

The “Guaranteed Lifetime Income benefit” is particularly attractive as part of an alternative program that guarantees future income because it underscores… simplicity… strong guarantees against loss and a lifetime income that can increase but never decrease.

The “Guaranteed Lifetime Income benefit” is an important option that can enhance IRA, 403b and 401k investments as well as money in CD’s and Money Market accounts. A “competent, knowledgeable, advisor” is capable of setting up an account and setting in motion the transfer funds from institution to institution in a matter of minutes.. Usually funds in qualified accounts, annuities or life insurance, transfer tax free. 100% of your money should go to work for you with no commissions or fees charged to your new account… At the present time very attractive front end, incentive, bonuses of up to 12% for qualified individuals and corporate 401k plans, are available and guaranteed minimum growth rates of up to 8% compounding annually. You owe it to your own and or your employee’s financial future to look into these guaranteed accounts…

Bob Tonachio is CEO of Robert James & Associates… His firm has complete details about “Guaranteed Lifetime Income Benefits” call Kimberly @ 1-800-530-5700… For a Free, No Obligation, Consultation. His Firm Does Not Charge Fees.

U.S. Treasury Bonds wipe out Retired Investors

A Little over a month ago, Retired Investors Panicked and bought long-term U.S. Treasury bonds. Retired Americans living on fixed income as well as foreigners  — all emotionally jumped into U.S. Treasury bonds at the precisely the wrong time. Their goal: To find what they thought was a safe haven ... Something better than the near-zero yields on the short-term U.S. Treasury Bills. Many bought the longest term U.S. Treasury bond in existence — the 4.5% "bond" maturing in May 15, 2038. But as the Treasury bond buying frenzy reached a peak on December 18th of last year, they paid a premium for the bond and didn't get the face yield of 4.5%. Instead, because they had to pay a premium for the bond, they locked themselves into the lowest Treasury-bond yield in history: A paltry 2.52%!

Now for the rest of the story:

The real wipe out came when the following happened...

For each $100,000 in face value bonds… they paid a high premium price of $140,910. Now, the value of that bond has crashed to only $122,000, delivering a huge loss of $18,900 in six weeks... If they hold on to maturity… they receive the face amount of $100,000 and take a loss of $40,910.

The summary of interest return reads like a fixed-income horror story:

Annual yield: A paltry 2.52%

Market loss: 12.85%

Years of interest lost: 12.85/2.52 = 5.3

Time elapsed: 6 weeks

Loss: the equivalent of more than 5 YEARS OF INTEREST in 6 weeks.

This easily is the epitome of the most stupidity in the history of Treasury bond investments! Retired investors and the 10,000 or more advisors we have trained over the years were taught by us to avoid this trap. Do you see why we are recommending other, alternative, depression-proof sources of income and profits for you… not long term bonds

Don't be left behind. Especially in these trying times! You must take action to protect yourself… We see retired people with 60 to 70% of their savings gone!... The foolish ones think they have to maintain their current, extravagant life style and gamble with their future... And surprisingly enough, some even defend their inept advisors that put then in this mess... One only has to look at the great depression to see that the same pattern existed...Look at the weak ones:  The Badly Managed Banks Failed…The Greedy Stock Brokers Failed.. Who was the Champion … The Insurance Companies… They paid every income payment on time and came out of the depression stronger then they went into it!... How about you?  Who would you rather be with?  Are you gambling on your future and present financial well being by staying with the present and historically weak ones?

Call Kimberly @1-800-530-5700. Bob's firm does not charge a fee for consultations or reviews.

Does My Financial Advisor Know Anything?

In 2009, there would likely be a great deal of support for Will Shakespeare’s, “The first thing we do, let's kill all the lawyers." — today, the idea might be to kill all the “financial experts”. It seems that almost all the financial concepts we have relied upon in recent years have turned out to be nothing more than a conundrum. What is the public to do to obtain financial security? Who and what can be relied upon for help achieving this goal? What assertions should a knowledgeable financial advisor have make to a client?

Myths we now know to discard … Let's start by examining old myths that have been recently destroyed:

Myth A:  Risk can be controlled.  The 2007-2008 Yearbook of the Securities Industry and Financial Markets Association (SIFMA), in the first ranking is a listing of financial firms ranked from largest to smallest based oncapital. Since this listing was compiled barely one year ago, the No. 1 firm, Merrill Lynch, has since sold itself under hardship to Bank of America, and No. 4, Lehman Brothers, and No. 6, Bear Stearns, both failed and went out of business. If these firms, each employing tens of thousands of the best financial minds in the business, could not control their risk enough just to stay in business, how can the average person expect to do so? And, why should the average person rely upon similar firms, their strategies or their advice?

Myth B: Smart management can achieve excellent returns. On page one of the SIFMA Yearbook, in the 35th position is Bernard L. Madoff of Investment Securities LLC. This firm rose to prominence because it was able to consistently deliver above-average returns to its customers, no matter what the economic environment. Its founder and CEO was a very respected figure on Wall Street, a man who could credibly claim to possess the special knowledge required to beat the market. However, we have since learned that it was all a lie — a Ponzi scheme that lost perhaps $50 billion in investor funds. And note this: The Madoff firm had 147 employees and 54 registered representatives. How could it be that none of them knew the firm's financial statements were a complete fraud?  How come the SEC examiners found nothing?

Myth C: Invest regularly in your 401(k) and it will take care of your retirement. The financial advice that had become almost unquestioned was the idea that an employee who consistently invests in an employer's 401(k) plan over the course of his career, and who chooses a well-balanced portfolio of mostly stock mutual funds, will achieve a comfortable retirement. However, the  stock market losses of the past year have destroyed many retirement plans. Even worse, a report from Boston College's Retirement Research Center, which examined a number of scenarios in which workers had done everything right. In scenarios where a worker contributed 6 percent of their salary to a plan for 40 years invested in a target-date fund, and never touched their savings until retirement, the portion of the pre-retirement income that these savers could replace in retirement varied dramatically depending on when they retired. Those retiring in 1948 could replace 19 percent, 1999 retirees could replace 51 percent, and 2008 retirees could replace 28 percent. Notice that none of these percentages is anywhere near replacing 100 percent of their pre-retirement income.

Myth. D: Buying a home is always a good idea. … That’s all Folks!... Here come the Easter Bunny!

Bob Tonachio is CEO of Robert James & Associates, Inc.

Call Kimberly @1-800-530-5700. Robert James & Associates does not charge a fee for consultations or reviews

How far will they take you?

Retired and Pre-retirement individuals have to be more concerned about outliving their money than ever before.

As Americans, we work hard to earn an income to take care of our families, educate our children and provide for a secure retirement. As retirement age draws near, we are wise to ask ourselves:

  • Will we have enough money to retire?
  • Will we outlive our money?
  • How safe are our Retirement Dollars?
  • Will we ever, in our lifetime, make up stock market losses?
  • Will our mutual finds and EFT’s ever get us back to even before we die?
  • Should we consider a Reverse Mortgage?
  • Will ever increasing taxes affect our standard of living?
  • What happens to my family if I become ill and have to enter a nursing home?

Is there an ideal Retirement Portfolio?

  1. Never causes me to lose money?
  2. Guarantees me a lifetime income I and my spouse can not outlive
  3. Guarantees My Lifetime Income Account to Grow by 8% or more no matter what the stock market or banks do?
  4. Guarantees my Lifetime Income to never go down

For Answers to these important questions…
Call Kimberly @ 1-800-530-5700

Serious Threats to your Retirement

If you've been a careful, conservative investor over the years ... Washington is beating you up by keeping interest rates low and systematically devaluing your dollars. If you've paid off your home ... the housing bust is destroying one of your largest sacred assets. If you've been listening to conventional advice from inexperienced and inept advisors about investing in stocks, bonds and mutual funds ... your portfolio has probably lost 30%, 60%, or more. We are living , in some of the darkest days for savers and investors since the years of the Great Depression. Savings accounts are paying one tenth of one percent, CD’s 2%, Money markets ¼% and T-Bills ¼%. For many years, I've been warning advisors and investors about all of these potential risks. If they heeded my advice they should have been able to avoid much of the pain that is now being dished out to their clients, friends and relatives.  As for today I see another series of threats that are being ignored  They are every bit as dangerous as the crises I've been presenting in my seminars and articles.  Let’s Take a looks at these new threats 

New Serious Threats to Your Retirement!

Your ability to accumulate sufficient savings can make or break your retirement dreams.  As stated previously retirement savings all over the world have been destroyed.  Unfortunately, many people are in denial ... they think everything is going to be ok, even if their investments don't recover for a while.

They're counting on income from pensions and Social Security. They mistakenly believe costs for their basic necessities will not go up from here. Furthermore, they're grossly underestimating just how rapidly taxes will eat away a lot of the money they do have left. But unless they take swift, decisive action, they will end up falling far short of a comfortable retirement . Take a look at what's happening right now ...

Serious Threat #1: Social Security and Medicare on the Brink of Collapse! Social Security and Medicare trust funds will run out sooner than expected.  The Medicare, date is 2017 rather than 2019. For Social Security, it's 2037 rather than 2041 ... In 2016, the program will begin collecting far less money than it pays out! Many people are counting on these failing government programs as part of their retirement plan ... Big mistake as both are in trouble. Long-term systemic problems are the big issue. But the recession is compounding the problems. Fewer jobs mean less taxes to fund the system. Washington seems to be too busy giving billions to big banks to care about you. In fact, their poor fiscal policies are causing big problems for both programs! The average Social Security recipient was receiving only $1,079 a month in 2008.!

Serious Threat #2: Pensions Disappearing, and the Government doesn’t quite get it! When we survey the health of corporate pensions, we see even more problems. Just consider the failure of a firm like General Motors and you'll see how many retirement dreams are getting crushed on a daily basis. Even companies with sound businesses are seeing their pension plans get decimated by massive losses in stocks and bonds.
The worst part is that the PBGC (the government agency charged with insuring failed pension plans) has been consistently running deficits of its own. So much for a sure-fire reliable fall back! If you have a pension plan, you need to know how healthy it is ... and what to do if it fails. Don't have a pension plan? The situation is still going to affect many of the big companies you invest in as their employee pension plans suffer losses. So either way, you must understand the current pension fund crisis.

Serious Threat #3: Taxes Only Set to Rise from Here! Due to the rate that Washington is pumping money into our system, higher taxes may end up killing millions of retirement dreams! After all, they are living on fixed incomes ... so even small additional costs send their budgets reeling! Imagine what will happen if all your Social Security benefits start getting taxed ... if the government starts taking another 10% off the top of your retirement account withdrawals ... and if Washington institutes a national sales tax on all the daily items you buy!
You absolutely must understand what changes are coming and how to position your investments ahead of time.

Serious Threat #4: The Costs of Health Care, Energy, and Food are set to go higher! Food, health care, and energy are eating up more and more of your budget. Gas prices could go to $5 or $6 a gallon in the near future. According to Fidelity Investments, the amount needed for retiree health care costs has jumped 50 percent in just the last seven years! They say an average 65-year-old couple currently needs $240,000 to cover their healthcare costs even with Medicare!

If you don't take precautions right now, you could find it VERY hard to maintain your lifestyle. You may have to take on jobs for extra income or give up golf and vacation trips. Fortunately, You Have time to protect yourself and prosper throughout financial crises. It is highly important to take positive corrective action now!

While we have the utmost respect for financial planners, investment advisors and anyone else who tries to help people better their lives. We also recognize that financial advisors cannot spend hours and hours on end with each client. Nor do they typically specialize in   safe retirement plans or have a broad knowledge of them..

Some estimates we've seen, the  price for a consultation with a financial planner is $175 an hour. Some charge as much as $500 or $600 an hour! Always ask him or her to show you the results he has attained for his existing clients during this market before you get in too deep. 
The other alternative… you could meet with someone from a major brokerage firm or bank  to talk about your retirement ...But you would probably get steered into in a few of the firm's expensive funds and hand over a percentage of your savings just for the privilege or risking your money.

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