Market Commentary
For the week of April 28, 2008

The Market
With government reports largely quiet the past two weeks, corporate earnings have taken center stage.
That will change this week, as the Federal Reserve bank holds its meeting Tuesday and Wednesday.
Analysts expect another quarter-percent rate cut. Since last summer, the Fed has cut its federal funds
rate by a cumulative 3 percentage points, from 5.25 percent to 2.25 percent. Thursday, the government
will release its personal spending report, expected to show a 0.3 percent gain in March, followed Friday
by the employment report, expected to show a drop of 75,000 jobs in April and an increase in the
unemployment rate to 5.2 percent. For the week, the Dow rose 0.33 percent to end at 12,891.86. The
S&P gained 0.55 percent to close the week at 1,397.84, and the NASDAQ added 0.83 percent to finish
the week at 2,422.93.

Source: * Past performance is no guarantee of future results. Indexes are unmanaged and
cannot be invested into directly. Three and five-year returns are annualized. The S&P, excluding “1 Week”
returns, is a reflection of return to an investor, by reinvesting dividends after the deduction of withholding tax.

Unexpected Drop – New unemployment claims dropped unexpectedly for the week ended April 19 by
33,000 to a seasonally adjusted 342,000. Analysts had predicted initial claims would increase by about
3,000, according to a Reuters poll. The four-week moving average of new claims, a more reliable
measurement because it evens out weekly fluctuations, fell from 376,750 to 369,500.

Don’t Stop Now – A 40-year-old employee that invests $1,000 at the beginning of every month in a tax-
401(k) account will accumulate $510,000 by age 60 if the funds grow at 7 percent per year. If
that individual was forced to suspend his/her monthly deferral for just four years from ages 45-48, the
account is worth just $394,000 at age 60. This mathematical calculation ignores the ultimate impact of
taxes on the account which are due upon withdrawal, is for illustrative purposes only and is not intended
to reflect any specific investment or performance. Actual results will fluctuate with market conditions and
will vary (Source: BTN Research).      

For Just One Year? – The average private college costs $32,307 for tuition, fees, room and board for
the current school year (2007-08), more than a three times increase over the $10,455 average cost from
20 years ago (1987-88 school year). If the same
rate of inflation occurs over the next 20 years, an
average private college will cost $99,832 for the single school year of 2027-28 (Source: College Board,
BTN Research).  

After A Big Gain – In the past 75 calendar years (1933-2007), the S&P 500 has gained at least 30
percent on a total return basis 16 separate times (most recently was a 33.4 percent gain in 1997). The
subsequent three calendar years following 14 of the 16 big up-years generated a positive total return.
The average three-year total return performance (in aggregate) for the S&P 500 following the 30 percent
up-years has been a gain of 34 percent (Source: BTN Research).   

WEEKLY FOCUS - The Gift of Financial Literacy

Congratulations! Today is Financial Literacy Day, and
you’ve already given yourself the gift of reading this
newsletter to expand your knowledge about the
financial markets and related topics. Unfortunately, you
may be in the minority. Statistics show a somewhat
depressing picture of our nation’s financial literacy:

  •        In a biennial survey by the Jump$tart Coalition
for Personal Financial Literacy, high school
seniors correctly answered only 48.3 percent
of the questions correctly, a decline from 52.4
percent in 2006. Accuracy increased with age
and education: college freshman averaged 59
percent and college seniors answered 65
percent correctly.

  •        Only 29 percent of workers ages 21 to 24 sign up for their employer’s retirement plan,
compared with 60 percent of those ages 55 to 64, according to the Employee Benefit
Research Institute.

  •        According to the Institute for Social Research at the University of Michigan, 34 percent of adults
between the ages of 18 and 34 receive financial assistance from their parents, averaging         

Researchers agree children should begin learning
money lessons early and that those lessons should be
appropriate to the child’s age and development. For example, kindergartners learn how to identify and
count currency and coins, so it’s a good time to start a piggy bank and, regardless of whether the money
comes from gifts, an allowance or chores, to emphasize the concept of saving. Introduce new concepts
every few years – how interest works around fifth grade, budgeting in junior high, the dangers of debt by
the end of high school.

You can also encourage your child’s or grandchild’s school to place a greater emphasis on financial
literacy and offer your help with extra projects or events that focus on money lessons. Groups like Boy
Scouts or Girls Inc. often welcome help from adults in teaching children valuable life lessons. You can find
a wealth of information and materials for teaching finances to kids at

We often view our legacy as what we leave behind for our children and grandchildren. Financial literacy
is a legacy you can begin imparting today to prepare your loved ones for the monetary gifts you may
leave them in the future. If you need help talking to your kids, grandkids or other family members (child or
adult) about money, please feel free to call our office.

* The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of
the stock market in general. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded
blue-chip stocks. NASDAQ Composite Index is an unmanaged, market-weighted index of all over-the-counter
common stocks traded on the National Association of Securities Dealers Automated Quotation System. The
Morgan Stanley Capital International Europe, Australia and Far East Index (MSCI EAFE Index) is a widely
recognized benchmark of non-U.S. stock markets. It is an unmanaged index composed of a sample of companies
representative of the market structure of 20 European and Pacific Basin countries and includes reinvestment of all
dividends.  WMCSAI# 275655
Copyright © 2010 The Money All rights reserved.
Returns through 4/25/08
1 Week  
Dow Jones Industrials  
NASDAQ Composite
S&P 500  
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