NATIONAL TRENDLINES
14001 Berryville Rd., North Potomac, MD 20874.
1 year, 4 issues, $85.

Lower prices into 4th quarter

        Douglas Jimerson: "Stocks have entered another correction. The current decline will likely lead to accelerating losses for stocks for the remainder of the year, as significant liquidity, i.e. buying power, has been consumed over the past six months in just keeping stock market losses to single digits. International stocks are paralleling U.S. stocks.
        Bonds have benefited from the weakness of stocks this year. Although bond funds remain higher for the year, we believe that bonds are topping and will turn lower.
Gold has reentered another declining phase in its multi-year see-saw price pattern. Gold funds continue to lose ground for the year.
        The asset allocation accounts remain positioned 100% in money market funds."

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THE FINANCIAL REPORT CARD
P.O. Box 7173, Kensington, CT 06037.
Monthly, 1 year, $129.95.

Master Plan - Stick to the Plan

        Dr. Robert Valuk: "Making money in any market can often be described as easy or hard. The real estate market has been offering easy money, but some say this bubble will soon be in bust mode. We have always been in the "take the money and run" camp regardless of tax consequences for all markets. When the real estate bust strikes, property near water and in Florida should be more likely to retain value with a huge "baby boomer" demographic in their favor. A strong signal for this decline will be 30-year mortgage rates above or near 5.75%. As far as making money in this range-bound market, we offer our tried and true method that fall in the "hard work" for investors category:
       (1) buy conservative mutual funds that pay dividends
       (2) buy large-cap stocks that pay dividends
       (3) trade stocks you know and follow
       (4) buy high-yield stocks, especially oil trusts
       (5) write covered calls on stocks that pay dividends
       (6) write covered calls on a few "concept" stocks (biotech or technology)
       And yes, (3) we actually recommend making selective short-term trades
       in stocks you know. Ironically, these methods work well in all markets, but are especially defensive in range-bound markets. When the market cycle shifts (breaks out of its range), growth stocks and more aggressive sectors may be purchased by investors willing to assume more risk. Our investment philosophy has remained constant for over 12 years, and our record speaks to its effectiveness for diligent and patient investors. Value investors should keep a significant amount of their portfolio in cash (bond funds, CDs, money market, etc.) to be able to attend any stock market "fire sale" when it occurs. We consider 20% an absolute minimum."

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