Wow!! What a humbling year for the entire investment community including investors, advisers, traders, economists, Wall Streeters, tipsters, brother's-in-law, etc. While our will to remain committed to longer term investing has been tested, we as advisers are confident that both the DOW and NASDAQ shall improve. Remember, IBM still makes great machines; Microsoft is still the boss of the street in the land of software and Citigroup still loans money at a profit.

The year 2000 for investors was not only brutalizing, but it provided great education for those who confused good stock picking and asset allocation selection with a hot market. This is the first time since '73-'74 where we have seen steep market declines in three successive quarters. Now...to the culprits: First, the Fed was the leader of the band with 6 interest rate hikes within 12 months and as you know, Wall Street does not like rising rates. Second, the Euro against the dollar was trading at a low of 82 cents making it a very difficult year for international investing. Third, energy prices skyrocketed (short term) to over $37 dollars per barrel of oil, causing inflation fears. Fourth, as you no doubt have heard, we had an election this year rife with uncertainty, rancor and division; this is unsettling at best. Last, and probably most importantly, the story is weak earnings brought about by rising interest rates (inflation fighters) and now fear of a slowing economy (possible recession).

In response to all this ugliness, I believe we should continue to subscribe to the fundamentals of investing that have proven successful to us all over our many years as investors in capital markets. They are:

• Think Longer Term (3-5 years)
• Diversify - use asset allocation strategies
• Use proven and established Money Managers
• Stay with Quality
• Fine-Tune..occasionally
• Dollar-Cost-Average - add to accounts regularly
• Don't do it alone; use professional guidance
• Avoid panicked decisions

Wishing you a happy, healthy, and indeed prosperous 2001.