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Ideas for managing wealth in a tough economy

February 26, 2009 by  

Council says diversification is still the best investment strategyDuring the current recession everyone can benefit from a piece of sound economic advice, and one industry group is offering its own insights into managing wealth during turbulent times.

Dow Jones Wealth Management Advisory Council said that the optimal portfolio mix in the current conditions focuses on opportunities in liabilities instead of assets and makes allocations for the long term. As always, keeping the portfolios diversified is the best strategy.

"Our clients are making sure that their long-term risk tolerance is in line with their asset allocation," said Patricia Bell, senior vice president of investments for Merrill Lynch. "Where there is a disconnect there needs to be discussions."

Council members are also advising their clients to reduce exposure to risky investments and to focus on simple financial instruments. According to Mike Sawyer, managing director of investments at Citi Smith Barney, now is a good time to invest in fixed income, high-dividend blue chip stocks, well-managed funds and appropriate deposit vehicles.

The council is a group of top wealth managers dedicated to promoting the practice of wealth management, facilitating industry discussion and representing the needs and concerns of the profession.

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  • Virginia Prendergast

    Some one needs to tell Osama Obama to stop talking at people and to stop wagging and pointing his finger…
    He is dumb as a door nail about the economy and about everything else…

  • s c mailen, jr.

    Virginia, you’re right about Obama’s consummate ignorance of economics. Presidents don’t get elected because they are economics wizards. Presidents use lesser mortals to “help” them. The fact that Bernanke doesn’t know what he’s doing won’t help the economy.
    I would like to know how/why ANY president has ANY moral or legal
    right to appoint the head of a private corporation [the 'Fed']. I know it will never be explained, but we do deserve an answer. Without that explanation, our imploding economy is simply a matter of ‘Washington knows best. Shut up, and be a good [dumbed-down and controlled] citizen.’

  • Allan

    Heck if the gov’t had thrown those bills out to the public our purchases would have stimulated the economy like a huge rolling wave. I haven’t seen even one speck of recovery and the market is heading into a deep abyss. If the poor guys had received the money they would be purchasing and restoring business like a rolling storm. Oh well: In time they may become aware they need to load up some planes with currency and then let em’ fly. We will do the rest in restoration.

  • Bob Livingston

    “As always, keeping the portfolio diversified is the best strategy.” I believe this to be a true statement.

    I would be reluctant to take investment advice from Merrill Lynch who just had a government bailout. If they took their own advice it did not work. Now is the time to invest in precious metal stocks which are contra-cyclical to the New York market, which is still in a downward direction. Also some precious metal stocks pay dividends.

    • John Shroeder

      Bob, I saw the letter saying you were recommending buying silver coins for a couple on fixed incomes with little to invest. I purchased a few some time ago but learned that coins of any sort are one of the things that the public has to buy retail but sell wholesale. Diamonds are another.

      • Bob Livingston


        The recommendation was based on the desire to get a financial safety net if needed for survival and silver coins can be purchased for much less investment than gold coins.

        You are correct that there is a “spread” between the buying and selling price. It is normally between 3% and 5% and if it’s larger than that, find a different dealer.

        The point of silver coins (and gold) is for a financial safety net to use in times of crisis, not for short-term trading where the 3-5% spread might be a factor.

        However, if you do wish to trade in and out of coins for profit in the shorter term, the spread between reatil and wholesale is essentially like a broker’s commission when you buy and sell stocks… although it may be higher depending on volume.

        Best Wishes — Bob.

        • John Shroeder

          Good answer on the coins. Thanks for clarifying my thinking.

      • John Hunt


        Is there any oversight or regulations on that 3% to 5% ?

  • John Shroeder

    This morning’s headline quotes the President and his staff as saying they won’t “cater to the whims of the investing class.” Apparently they don’t even understand that unions, teachers, firefighters, federal and state civil servants, and a majority of the public have their retirement funds invested in the market so all of these people and voters are included in “the investing class”. This illustrates their distorted view of the country and its people.

  • Dan

    DO NOT take advice from Citi-Smith Barney – have you seen the GOBS of money they have lost – at least 50% or more of their INVESTOR’S nest egg – and STILL FALLING!

  • John Hunt

    To: Personal Liberty News Desk,

    Buy into fixed income. If you are old, especially when you are old while we are facing serious inflation, are you nuts? Merrill Lynch??? what on earth do you expect them to say? The market is being manipulated as it is brought up on false incentives in these volatile markets and then they (profit takers) sell and "bang" down it goes again and then they do it over again. How many times has it been done since the first if the year? Up 300 down 280 , Wow, a licence to steal. Sometimes you are allowed to pick up some crumbs. The average broker is just a shill and doesn't even know it.


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