Solis Wealth Management Report – September 3, 2013

The Markets

Last week was crunch time in the National Football League (NFL). With the 2013 regular season approaching rapidly, NFL teams cut about 700 players from their rosters over the Labor Day weekend.  That was a big cut—about a 40 percent drop in player employment—as rosters were pared from 90 to 53 players.  However, it’s not likely to have a significant effect on U.S. unemployment data—and that’s really what the week ahead is all about.

Last week, markets jittered and slumped on news that Syria was thought to have used chemical weapons against civilians. According to The New York Times, 70 percent of stocks that trade on the New York Stock Exchange finished Friday lower, and 73 percent of those listed on the NASDAQ lost value.

There were signs of renewed optimism on Labor Day. Although U.S. markets were closed, world markets responded well to news that there would be no immediate American military action against Syria. Encouraging economic data from China and Europe helped share prices, too, although it didn’t do much for government bonds, gold, or the Japanese yen.

Post Labor Day, investors will be anticipating employment data with the zeal of Green Bay Packer fans decked out in foam cheeseheads awaiting the opening kickoff at Lambeau field. The Financial Times, a British publication that has little interest in American football but great interest in U.S. Federal Reserve policy, put it this way:

“Members of the U.S. Federal Reserve open market committee will get their last pieces of information about the labor market before their all-important September meeting, which has been heavily trailed as posing the first real opportunity for the Fed to embark on a taper…The US economy has been recovering at a painfully slow but steady rate for more than two years now and with no sign of any step-up in the pace of improvement, the Fed policy-makers face a finely balanced decision.”

No matter what happens, emotions are likely to be running high this week.

Data as of 8/30/13

1-Week

Y-T-D

1-Year

3-Year

5-Year

10-Year

Standard & Poor’s 500 (Domestic Stocks)

-1.8%

14.5%

16.7%

15.9%

5.0%

4.8%

10-year Treasury Note (Yield Only)

2.8

NA

1.6

2.6

3.8

4.6

Gold (per ounce)

1.3

-17.7

-16.0

3.9

11.2

14.0

DJ-UBS Commodity Index

0.2

-6.2

-10.1

-0.4

-6.6

0.9

DJ Equity All REIT TR Index

-1.9

-0.6

1.4

13.1

4.9

9.5

Notes: S&P 500, Gold, DJ-UBS Commodity Index returns exclude reinvested dividends (gold does not pay a dividend) and the three-, five-, and 10-year returns are annualized; the DJ Equity All REIT TR Index does include reinvested dividends and the three-, five-, and 10-year returns are annualized; and the 10-year Treasury Note is simply the yield at the close of the day on each of the historical time periods.

Sources: Yahoo! Finance, Barron’s, djindexes.com, London Bullion Market Association.

Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. N/A means not applicable.

SOBERING STATISTICS AND INVESTMENT IDEAS SOMETIMES go hand-in-hand. When one of America’s favorite fast food chains unveiled a new product in Japan, some people wondered how long it would be before this fine innovation — a three-quarter pound, 1100 plus calorie serving of potatoes called Mega Fries— would reach our hungry shores. Others deliberated on the ways in which higher consumption of nutritionally deficient foods may affect obesity rates and illness in countries around the world. They may even have done a Google search to ascertain which companies are working on cures for diabetes, developing treatments for heart ailments, or bio-engineering organ replacements.

A key measurement in evaluating the ill effects of diseases and health conditions is the Disability-Adjusted Life Year or DALY. According to the World Health Organization:

“One DALY can be thought of as one lost year of “healthy” life. The sum of these DALYs across the population, or the burden of disease, can be thought of as a measurement of the gap between current health status and an ideal health situation where the entire population lives to an advanced age, free of disease and disability…DALYs for a disease or health condition are calculated as the sum of the Years of Life Lost (YLL) due to premature mortality in the population and the Years Lost due to Disability (YLD) for people living with the health condition or its consequences…”

It’s depressing to note that mental disorders and drug and alcohol abuse are the biggest drivers of disability. They account for more than 7 percent of DALYs. That’s more than diabetes, HIV, or tuberculosis, and almost as many as cancer. Globally, in 2010, depression and anxiety were responsible for about 11 million lost years of healthy life in the 20- to 24-year-old age group. Drug use also appears to peak at about this age. The number of DALYs for depression and anxiety appears to decline with age.

Perhaps the best idea is corporate wellness programs. Research published by HarvardUniversity in 2010, found that medical costs declined by about $3.27 for every dollar spent on wellness programs. In addition, the cost of absentee days decreased by about $2.73 for every dollar spent.

Weekly Focus – Think About It

“When you are offended at any man’s fault, turn to yourself and study your own failings. Then you will forget your anger.”

Epictetus, Greek Stoic philosopher

What’s happening at Solis Wealth Management?

Please enjoy this week’s commentary from ~ Tami Salzer, LPL Registered Administrative Assistant

Summer is coming to a close and fall to begin; the start of such a beautiful time in the desert when the mornings and evenings cool down.

I try to embrace each season even though at times the summer in the desert can be a bit trying!  This summer has been a mild one so I feel blessed!

Our Daughter Salem, her husband Curtis and our precious granddaughter Hayden visited us for the Labor Day Weekend.   It was such a blessing to spend time with our granddaughter Hayden who is seven months old now.

I wanted to take this opportunity to acknowledge how blessed we are to live in this country of ours, the United States of America!! When watching the news, lately it has been so evident how great our country is and how we should wake up each day and give thanks.

I hope everyone has enjoyed their summer.  I’m looking forward to seeing all of those who will be traveling back to the desert for the season.

As always, please know we are here for you and it is our pleasure to assist you with any questions or concerns ~ Tami

Best regards,

Greg R. Solis, AIF®
President

Solis Wealth Management
78-075 Main Street
Suite 204
La Quinta, CA 92253
Office: (760) 771-3339
Fax: (760) 771-3181www.soliswealth.com
E-Mail: greg.solis@lpl.com

CA Insurance License #0795867

The Wealth Advisors of Solis Wealth Management are also Registered Representatives with and securities and advisory services are offered through LPL Financial, a Registered Investment Advisor. Member FINRA/SIPC

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* This newsletter was prepared by Peak Advisor Alliance. Peak Advisor Alliance is not affiliated with the named broker/dealer.

* 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 DJ Global ex US is an unmanaged group of non-U.S. securities designed to reflect the performance of the global equity securities that have readily available prices.

* The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.

* Gold represents the London afternoon gold price fix as reported by the London Bullion Market Association.

* The DJ Commodity Index is designed to be a highly liquid and diversified benchmark for the commodity futures market. The Index is composed of futures contracts on 19 physical commodities and was launched on July 14, 1998.

* The DJ Equity All REIT TR Index measures the total return performance of the equity subcategory of the Real Estate Investment Trust (REIT) industry as calculated by Dow Jones.

* Yahoo! Finance is the source for any reference to the performance of an index between two specific periods.

* Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.

* Past performance does not guarantee future results.

* You cannot invest directly in an index.

* Consult your financial professional before making any investment decision.

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[1] http://www.cbssports.com/nfl/eye-on-football/23400230/final-nfl-cuts-teams-trim-rosters-down-to-53-players

[2] http://www.cbssports.com/nfl/writer/pat-kirwan/23434009/five-things-to-know-what-goes-into-finalizing-nfl-rosters-at-53

[3] http://www.nytimes.com/2013/08/31/business/daily-stock-market-activity.html?_r=0

[4] http://www.reuters.com/article/2013/09/02/us-markets-global-idUSBRE96S00E20130902

[5] http://www.ft.com/cms/s/0/f898538c-1166-11e3-a14c-00144feabdc0.html#axzz2dkbb9FMl

[6] http://www.investopedia.com/stock-analysis/053113/investing-global-diabetes-epidemic-mcd-nvo-rvp-wst-bdx-podd-mnkd-dva-lly-sny.aspx

[7] http://www.who.int/healthinfo/global_burden_disease/metrics_daly/en/

[8] http://www.economist.com/blogs/graphicdetail/2013/08/daily-chart-20

[9] http://dash.harvard.edu/handle/1/5345879

[10] http://www.brainyquote.com/quotes/authors/e/epictetus.html#VeJmMsEEgfrbFEyK.99