SHAFFER ASSET MANAGEMENT, INC.

Today's investment climate offers unprecedented opportunities and historical levels of risk. At Shaffer Asset Management, Inc., our mission is to help our clients take advantage of those opportunities and preserve assets from extreme risk levels to meet both their medium- and long-term financial objectives. 

The game has changed. With the demise of Bear Stearns and Lehman Brothers, banks too big to fail philosophy, and the US Government ownership of major companies and institutions, anything is possible. The past few years have proven that the "efficient markets hypothesis" was false. Asset allocation doesn't work when all asset classes move in tandem as was experienced in the fall of 2008.

Our current analysis is indicating that the United States is in a very deep recession and has a very high probability of heading towards a depression. Over the past few years, almost every leveraged vehicle has had some type of a margin call. In other words, the 25 years of credit expansion has ended and it is now time to pay the money back. The problem is that the underlying assets that were used to support our debt appetite are no longer at the values that were originally appraised. On top of this worldly margin call, the US debt clock keeps ticking deeper and deeper into debt. Banks are being shut down almost every week by the FDIC and according to the latest "Quarterly Banking Profile" for the third quarter 2009: "The number of insured institutions on the FDIC’s “Problem List” rose from 416 to 552 during the quarter, and total assets of “problem” institutions increased from $299.8 billion to $345.9 billion. Both the number and assets of “problem” institutions are now at the highest level since the end of 1993."  And, we believe that the climbing US debt will have a multiyear drag affect on our economy.

Of course, time will tell but, in the meantime, is your portfolio investment strategy prepared for the worse or even have the potential to profit from this mess, just in case?

The markets can be very confusing, especially with conditions and policies that affect the markets daily. At Shaffer Asset Management, Inc., in order to give you more insight and interpretation of markets and economic conditions to assist you in your investment decisions, we offer the "Shaffer Market Report", a twice per week newsletter with Daniel Shaffer's opinions and technical analysis of the stock market, major indices, commodity futures and currencies. Also, we offer the "Shaffer Stock Investment Program", an unusual and unique investment strategy, which follows our research and philosophy, and is available for adviser managed accounts.

For assistance with your financial management, or for more information, please contact us today at (914) 468-0862 or info@shafferasset.com.