For the week of January 21, 2008

President Bush announced an economic stimulus plan totaling about $145 billion in tax relief last week, hoping to spur Americans into spending. The plan had little immediate effect on Wall Street, which received reassurance the week before from Federal Reserve Chairman Ben Bernanke, who said the Fed is ready to take aggressive measures to support the economy. Most analysts read that to be a promise of a half-point rate cut at the Fed’s meeting later this month. For the week, the Dow lost 3.98 percent to close at 12,099.30. The S&P fell 5.39 percent to end the week at 1,325.19, and the NASDAQ dropped 4.10 percent to finish the week at 2,340.02.

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.

The Dead Rose – On August 13, 1979, BusinessWeek ran a cover story that was titled “The Death of Equities.” The S&P 500 closed at 107 on August 13, 1979. The S&P 500 closed calendar year 2007 at 1,468 (Source: BusinessWeek, BTN Research).

Job Claims Drop – Workers filing initial claims for U.S. unemployment benefits fell unexpectedly by 21,000 for the week ended Jan. 12, suggesting some improvement in the labor market. According to the Labor Department, first-time claims for state jobless benefits fell for the third consecutive week, dropping to 301,000 in the week ended Jan. 12 from 322,000 for the prior week and to its lowest since Sept. 22.

Put It On My Card – Social Security is going electronic. The Treasury Department plans to roll out prepaid debit cards to select states this spring, with nationwide distribution in August. On payment days, benefits will be loaded onto the recipient’s card, which can then be used at ATMs, banks, retail locations and online. There will be fees for ATM or bank withdrawals and online bill payment, however, there will be no overdraft or declined transaction fees. Because an electronic payment cost 80 cents less than issuing a paper check, the federal government estimates it would save $44 million per year if all 4 million recipients signed up. Last year, approximately 60,000 Social Security checks were stolen; the debit card would be a more secure way of getting benefits to recipients.

Unlikely – A day before OPEC’s quarterly meeting in September 2007, the headline in the Wall Street Journal stated “Wary of a Slowdown, OPEC Is Unlikely to Lift Output.” The following day Sept. 11, 2007, OPEC surprised the oil markets and decided to boost its daily crude oil production by 500,000 barrels a day (Source: WSJ, BTN Research).

A Better Year – The earnings of the S&P 500 companies are projected to grow 16.1 percent during 2008 over their 2007 levels (Source: Thomson Financial, USA Today, BTN Research).

WEEKLY FOCUS – Don’t Take Your Password To Your Grave

Computer security and privacy gurus admonish users to never write down user names and passwords and to never use the same password repeatedly for different accounts. But with the proliferation of websites giving us access to confidential information like our bank and investment account balances, keeping passwords straight in your head has become a mind-boggling proposition.

Now imagine the chore your heirs might face if you die suddenly without divulging those passwords to anyone. So how do you protect your passwords but make them available to those who need them in an emergency?

One option is account aggregation websites, which use sophisticated software called “screen scraping” to gather data from those PIN-protected accounts that have been authorized by the individual. Virtually any accounts that report balances on a website can be brought into your account aggregation profile: checking and savings accounts, investment accounts, mutual funds, 401(k) accounts, frequent flier and reward plans, travel reservation services, credit card accounts and loans. Some sites even offer digital document storage, providing a paperless depository for wills, insurance policies, powers of attorney, contracts and other important documents.

Even with account aggregation, you will still have at least one user name and password to make accessible for your loved ones. You may also need to remind yourself in the event of a hurricane, fire or other natural disaster. As part of your personal disaster recovery plan, put lists of your account numbers, user names and passwords in sealed envelopes. Give one to your attorney or other trusted advisor, place one in your home safe (fire- and water-proof), place one in your safe deposit box and send one to a trusted relative who lives in another state.

Preventing identity theft has become a growing concern. Be sure that in protecting yourself, you don’t inadvertently make things more difficult for yourself and your heirs in an emergency. If you’d like to learn more about account aggregation, give our office a call.

* 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. SAI# 266423