WEEKLY MARKET COMMENTARY
For the Week of November 26, 2007

THE MARKETS
With many of the big players on vacation for Thanksgiving and no major releases of economic data or
corporate earnings, trading volume on the major markets was at typical holiday lows. The shortened
trading session on Friday helped the Dow and the S&P recover slightly from losses of more than 1.5
percent on Wednesday. The Dow finished the week at 12,980.88, down 1.43 percent, while the S&P
closed at 1,440.70, down 1.21 percent. The NASDAQ lost 1.54 percent to finish at 2,596.60.









Source: Morningstar.com. * 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.

Here’s The Scoop – The final Fed meeting of 2007 will take place on Dec. 11, 2007. At the conclusion
of the meeting, the Fed will release a brief statement (typically five to six paragraphs in length) indicating
what action (if any) the Fed has decided to take and how the various members voted. The release of a
statement immediately following every Fed meeting has occurred for just the past eight years, a practice
that began 86 years after the Fed was started in the year 1913 (Source: Federal Reserve, BTN
Research).  

Big Bucks For The Fifth Grader – The average cost for one year of college education at an in-state
public college is $13,589 for the 2007-08 school year (cost includes tuition, fees, room and board). The
total one-year cost has increased 6.5 percent per year over the past 30 years. If that same annual rate of
inflation continues into the future, then a 5th grader today will ultimately pay $100,000 for his/her four
years of public college education during the years 2015-19 (Source: College Board, BTN Research).     

What’s in Your Gift Box? – Last year, consumers lost $8 billion in unredeemed gift cards, according to
TowerGroup, a research firm. The growth in gift card giving, which has exploded in the past four years,
has slowed to 6 percent this year for a total of $26.3 billion, compared to a 35 percent growth rate in
2006. The National Retail Federation says that 88 percent of consumers in a recent survey say they will
buy two or more gift cards this year. Buyers should watch out for fees, expiration dates and penalties for
inactivity.

Clarification – Last week’s Weekly Focus article on IRS rule changes for nonspouse beneficiaries of
401k and other qualified plan accounts incorrectly stated that such beneficiaries could delay distributions
until age 70½. Distributions must begin by the end of the year following the year of death.  If the decedent
was under age 70½ at the time of death, the beneficiary has the option of taking equal annual
distributions calculated over his own life expectancy or to take distributions of any amount, until the
account is liquidated, for the five years following the year of death. If the decedent was over age 70½, the
only choice is the five-year option. Situations vary, so consult your financial and tax professional.


WEEKLY FOCUS - Beware Bequeathing Trojan Tax Horses

Last year, according to the National Association of
Realtors, a record 1.07 million Americans purchased
vacation homes. The typical buyer was 44 years old and
had a median household income of $102,000. The
vacation home trend, which has been increasing in
volume but decreasing in average buyer age for several
years, has put a larger amount of property into estate
plans than in previous generations.

If your estate plan includes
gifting or bequeathing a
second home to your children, you may not be doing
them a favor. Your heirs will be responsible for paying for
maintenance, insurance and
property taxes on a gift they
may not use often enough to justify the ongoing expense.
If you have multiple children sharing in the property, the decision to keep or sell can be contentious,
especially if one child can afford the expenses and another cannot.

Some parents may have the wherewithal to fund a trust specifically to cover the ongoing expenses of the
home. Others, especially those already pressed to pay the mortgage on the second home, may want to
consider a
life insurance policy whose settlement can be used for property expenses. Another option is
to specify in the will that the second home must be sold and the proceeds divided among the heirs.

Some heirs may not want fixed assets or real estate of any kind, viewing it as not only a financial burden,
but an emotional one. An adult child may cherish the memories of family time spent at a vacation home,
but the realities of his life today may make it unfeasible to continue that tradition with his own children.
Guilt ensues over paying upkeep on a property he cannot use or selling the vacation home his parents
valued so highly.

Before including a vacation home or other real estate in your estate plan, you should consult with your
children about their willingness and ability to handle the ongoing financial responsibility. Our office can
help you examine your options and broach the often difficult subject of money with your heirs. Call us for a
family appointment.

* 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# 262138
Copyright © 2010 The Money Alert.com. All rights reserved.
Returns through 11/23/07
1 Week  
YTD
1-Year  
3-Year
5-Year
Dow Jones Industrials  
-1.43  
6.37
7.76  
9.85
10.55
NASDAQ Composite
-1.54
7.51   
5.30
7.29
12.07
S&P 500  
-1.21
3.29
4.41
8.98
11.15
MSCI EAFE
-0.42
10.35
15.19
18.80
20.71
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