George Washington's First Thanksgiving

Financial Lessons from Thanksgiving


By Steve Davis, CERTIFIED FINANCIAL PLANNER™

President George Washington designated November 26, 1777 as the first Thanksgiving Day recognized by the US government. In the years that followed, each state scheduled its own Thanksgiving holiday at different times, until Abraham Lincoln made it an ongoing National holiday. His proclamation read, “I do therefore invite my fellow citizens in every part of the United States, and also those who are at sea and those who are sojourning in foreign lands, to set apart and observe the last Thursday of November next, as a day of Thanksgiving and Praise to our beneficent Father who dwells in the Heavens.” For most of us, Thanksgiving goes by in a blur of family, friends, holiday preparations, and a table of traditional dishes. The story of the first Thanksgiving was very different from our own and holds important lessons for us today.

The Fruit of One’s Labors:
After landing on our shores, life was almost unbearable for the Pilgrims for the first few years. Crop yields were poor and many went hungry. William Bradford, the Governor of Plymouth Bay Colony later reasoned that the old English tradition of farming in common – where the harvest was collected and rationed based on need – led to a lack of productivity. It seems that some of the colonists resented not receiving a share of the harvest proportional to their labors. When Bradford decided to abandon farming in common in the spring of 1623, things changed. He set aside a plot of land for each family as their own private property to supply themselves with corn. The result was a bountiful harvest. The idea of enjoying the fruits of one’s own labor caused productivity to soar. Bradford wrote, “It made all hands very industrious, so much more corn was planted then otherwise would have been by any means.” And so, in the fall of 1623 Governor Bradford “set apart a day of thanksgiving.”

Recover from Mistakes:
When the Pilgrims first packed their belongings into trunks and crossed the rickety wooden gangplank onto the deck of the Mayflower, they were setting sail much later than they had originally planned. Instead of reaching their planned destination in Virginia, they found themselves hundreds of miles off course. They anchored in Massachusetts and braved a frigid first New England winter and then suffered three years of near starvation. Many would curse their bad luck and consider giving up, but not these hardy souls. The Pilgrims accepted the things they could not change and adapted and adjusted to their unforeseen and new conditions. How do we respond to setbacks? If you have experience investment losses, or if you’ve racked up too much credit card debt, or if you’ve made some bad career moves, resolve to recover and bounce back. We can learn from the Pilgrim’s example and ability to overcome.

Weather Hardships:
The men and women that first landed on these shores back in 1621 were not seasoned explorers or soldiers; they were mostly a group of religious Separatists who held regular jobs. They were farmers and printers and shoemakers with no experience or knowledge in establishing a settlement in an adverse land. During that first traumatic winter, half the pilgrims died.


And here we are, almost 400 years later, living in vastly different times. Still, human hardship remains. People get sick, loved ones die and we sometimes struggle because of unemployment or any number of other life events. The Pilgrims were a small group who leaned on each other and their Native American allies. What is your support network like? As you gather with your family and friends this week, take time to develop and appreciate the ability you have to offer support and guidance to one another.

Move Ahead:
Those first years in Plymouth must have been dreadful. Of course they didn’t have consumer confidence surveys back then so we don’t know the sentiment in the early 1620s. Eventually, the fledgling colonial economy became so successful that Governor Bradford wrote these words 24 years after the first Thanksgiving, “Any general want or famine has not been amongst them since to this day.” Years of abundance followed the first few hard winters. Eventually the colony produced enough corn to spare and trade for other comforts and enjoyment.

What about today? According to Bloomberg Consumer Comfort Index, confidence hovered last week near a record low. However, unemployment is slowly improving, businesses generally have good balance sheets and profits have been boosted by cost cutting on everything including capital spending and inventories. While the economic data doesn’t point to robust economic growth, the economy is expanding. It is my hope that soon workers will be enjoying the fruits of their labors with years of abundance.


Give Thanks:
Before you enjoy your meal this Thursday, perhaps you might like to share the words of President George Washington with those at your table. Here is his Thanksgiving Proclamation from October 3, 1789:

     Whereas it is the duty of all nations to acknowledge the providence of Almighty God, to obey His will, to be grateful for His benefits, and humbly to implore His protection and favor; and Whereas both Houses of Congress have, by their joint committee, requested me to “recommend to the people of the United States a day of public thanksgiving and prayer, to be observed by acknowledging with grateful hearts the many and signal favors of Almighty God, especially by affording them an opportunity peaceably to establish a form of government for their safety and happiness:”
     Now, therefore, I do recommend and assign Thursday, the 26th day of November next, to be devoted by the people of these States to the service of that great and glorious Being who is the beneficent author of all the good that was, that is, or that will be; that we may then all unite in rendering unto Him our sincere and humble thanks for His kind care and protection of the people of this country previous to their becoming a nation; for the signal and manifold mercies and the favorable interpositions of His providence in the course and conclusion of the late war; for the great degree of tranquility, union, and plenty which we have since enjoyed; for the peaceable and rational manner in which we have been enable to establish constitutions of government for our safety and happiness, and particularly the national one now lately instituted for the civil and religious liberty with which we are blessed, and the means we have of acquiring and diffusing useful knowledge; and, in general, for all the great and various favors which He has been pleased to confer upon us.
     And also that we may then unite in most humbly offering our prayers and supplications to the great Lord and Ruler of Nations and beseech Him to pardon our national and other transgressions; to enable us all, whether in public or private stations, to perform our several and relative duties properly and punctually; to render our National Government a blessing to all the people by constantly being a Government of wise, just, and constitutional laws, discreetly and faithfully executed and obeyed; to protect and guide all sovereigns and nations (especially such as have shown kindness to us), and to bless them with good governments, peace, and concord; to promote the knowledge and practice of true religion and virtue, and the increase of science among them and us; and, generally to grant unto all mankind such a degree of temporal prosperity as He alone knows to be best.
     Given under my hand, at the city of New York, the 3d day of October, A.D. 1789.

The 2011 Pan Mass Challenge Recap

By Steve Davis, CERTIFIED FINANCIAL PLANNER ™

It has been a month since my most excellent adventure and I can happily tell you that I’m fully recovered. I’m writing this note to offer my heartfelt thanks to those who supported my ride in the Pan Mass Challenge. Thanks to you, we are able to contribute $6,500 toward the expected $35 million total for the weekend; that’s more than half the Jimmy Fund’s annual revenue. Wow!

Hannah’s Huckleberries

I’ve been riding the PMC for 14 consecutive years and I thought it would be appropriate to share some thoughts and descriptions of this year’s four day, four hundred mile bike ride.

Our Pedal Partner: Hannah Hughes

For me, this year was particularly memorable because of a little girl named Hannah Hughes. Only eight months earlier Hannah had been diagnosed with a fast-growing cancer that required her family to routinely travel 200 miles each way from their home in Ballston Spa NY to the Dana Farber Cancer Institute where Hannah could receive treatment. While at the Jimmy Fund clinic, Hannah learned about the PMC and its “Pedal Partner” program which matches young patients with teams of cyclists. I ride on team Huckleberry which is comprised of a group of friends who routinely start the PMC a day early and ride from West Stockbridge so we can cross the whole state in a true Pan-Mass Challenge. Our team was honored to adopt Hannah and because her commute to Boston is so long, we thought it only made sense for us to bring the PMC to her.

On Wednesday, Sandy and I drove to Saratoga Springs, New York in anticipation of rendezvousing with several of my teammates the next morning. We had a wonderful evening together walking up and down the streets of that famous horse racing town. There was a big event scheduled at the track that weekend so the place was buzzing with activity. Main Street was lined with art galleries, restaurants and all sorts of interesting shops. Only later did we learn that the place once received the “Great American Main Street” award – who knew such an award even existed?! We found a nice restaurant where we could both do some serious people watching and where I loaded up on carbohydrates.  

Thursday morning dawned with clear skies and soon Sandy and I were off to meet the Hucks at a local Dunkin Donuts so that we could then travel together to Hannah’s home. It was fun for me to have Sandy there; she was able to meet a bunch of guys I’ve know and hung out with every summer, buy many of whom she had not yet had the pleasure to meet. Shortly after 9am, we all piled back into our cars and drove the short distance to Hannah’s home. We were greeted enthusiastically by Hannah, her mom and dad, her younger sister, and all sorts of neighbors, friends and extended family – they had all taken the morning off from work and gave us a warm welcome. For all the years I’ve ridden the PMC, I’ve always had a personal motivation to do so. When my mom was first diagnosed, it gave me an outlet; when friends were diagnosed or died from this terrible disease, it gave me an opportunity to ride in their honor… or their memory. This time, however, I was riding for someone I had just met and it added a new dimension to the PMC. I can’t imagine what it must be like for Hannah’s parents Jeff and Rana. For all the heartache they surely must be enduring, it gave my friends and me a great deal of joy to be able to show them support and hopefully buoy their spirits. And Hannah? She was vibrant, expressive and seemed genuinely happy. After an hour of warm conversation, our team prepared to leave for the first leg of our journey. Before we did, however, Hannah presented each one of us with a purple bandana embroidered with the words, “Love, Hannah”. I pray that God will heal this child and her family.  



Hannah and her mom, Rana



Hannah's Dad Jeff, Hannah, Huckleberry Hound
and Team Captain Dave Grossman



Ballston Spa NY to West Stockbridge MA

Hannah’s Huckleberry’s lined up in her driveway and after I gave Sandy a goodbye kiss and a few final hugs and high-fives to everybody else, we were off. There were thirteen of us riding in a single paceline following a route planned out and downloaded to a few bicycle GPS computers owned by some members of the team (very cool). We headed west across the Hudson River and then south parallel to the MA border until we finally crossed the state line in West Stockbridge. The route was nice, but one of the things those fancy GPS units can’t do is distinguish between dirt and asphalt roads. A few times we were surprised when the roads turned to gravel, but nothing was more surprising than the time I was bombing down a hill toward the finish at 35+ mph when the smooth decent turned to gravel… Yikes.



Paul Davis on the Summit of Mt Whitney



When I look back on the ride that day there were two things that stand out. First, when we crossed the Hudson, several of us spotted a huge American Bald Eagle. I had never seen one in the wild so it was pretty thrilling to see the majestic nature of this remarkable bird. Next, as we were approaching our lunch stop, I could feel my cell phone vibrating in my jersey pocket; it was an incoming text from my son Paul (who previously had joined me on three PMCs). Paul was hiking the 200-mile John Muir Trail from Yellowstone National Park through the Sierra Nevada mountain range and since there is no cell coverage along the trail, it had been several days since I last heard from him. Once we stopped for lunch and I pulled out my phone, I was thrilled to not only see that it was Paul who had texted, but that he included a photo from the summit of Mt Whitney, the highest point in the Continental US. I’m thankful that my teammates humored me while I acted like a proud dad and passed my phone around so they too could see my boy safe, sound and on top of the world. I imagine my feelings of relief were in stark contrast to the anxiety faced each day by Hannah’s dad and mom.



Dinner at the Shaker Mill Tavern





We arrived at the finish around 4 o’clock. In most years, the members of team Huckleberry drive out to West Stockbridge early Friday morning, but because we were all there Thursday night, we had the unique opportunity of sharing dinner together. This really was a lot of fun and is something I hope we can repeat in the future. I’m sure the proprietors of the Shaker Mill Tavern hope this same group of hungry cyclists makes it a recurring event too.

West Stockbridge to Sturbridge



In 1999 my good friend Jim Boyko and I planned to ride the PMC. It would be my second year riding and Jim’s first. He suggested that we start a day early and ride from the New York state line. Somehow Jim discovered that a few other guys had a similar idea and beat us to the punch by riding from West Stockbridge the year before. We were invited to join them and this was the genesis of Team Huckleberry. Since Jim grew up in Western Mass, he was able to tweak the original route and helped us discover some great roads and a terrific lunch stop (Atkins Farm in Amherst). But before lunch, we needed a place to grab a mid-morning snack – the place was a bakery in Huntington called Huckleberries. The food was great, the owner a doll and the locals even welcomed our group of sweaty stinky cyclists by putting PMC donations into a coffee can on the counter. A few years ago, the shop sadly closed down, but we keep its name alive.



The official Team Huckleberry jersey



Steve Siegel at the Huckleberry Bakery in 2004



 Since the beginning, we have always started our ride by lining up in front of the “Welcome to New York” sign so that we can capture a group photo. This year’s photo was different from all the previous ones because this year we posed wearing Team Huckleberry jerseys. After all these years, we finally had an official jersey! For the next 100 miles we managed to stay together throughout the day and finally arrived in Sturbridge as one. Our paceline was smooth and fast, plus we looked really good too!

  

The 2011 Team Huckleberry: Steve Weiss, , Tom Tinory, Steve Davis, Mark Stockwell, Mark Dolny, Jon Siegel, Ellen (Huck Chick) Kirk, Steve Siegel, Mike Lucas, Rawson Hubbel, Dave Grossman, Tim Conry, Joel Bard, Remy Evard, Scott Taylor

  

One of the most shocking things for me during the entire weekend was riding along Route 20 just west of Sturbridge. It was here that the June 1 tornado touched down and left a scar of devastation. In Brimfield, a ½ mile swath of broken trees extended for what is said to be 20 miles; our route went right through the middle of it.   



Aerial photo of tornado devastation along Rt 20 -- How did this house survive?

The PMC festivities take place at the Sturbridge Host Hotel and it is here that thousands of PMC riders converge to register, receive their PMC jerseys, and take place in the annual carbo-loading dinner and opening ceremonies. Lance Armstrong was one of the 5,227 riders taking place in the event. While everyone was celebrating and catching up with old PMC buddies, I received a somber phone call from Sandy. My grandmother, Gladys Davis had died earlier in the day. Nanny was 98 years-old and lived a good long life. I have such fond memories of Nanny and was always impressed with her enthusiastic outlook. In recent years, her mind had started to go and one of my last memories was visiting Nanny in her nursing home – Sandy and I were preparing to say goodbye when Nanny looked directly at us and said, “I’m SO happy.” It was the story of her life. We should all live to be her age.

 



Great Nanny and my dad



The Pan Mass Challenge: Sturbridge to Bourne

My friend Mike Lucas and I share a room together each year and Mike is in charge of the alarm clock. It went off at 4 am. Ugh. The PMC starts early in an effort to beat traffic. We’re up before sunrise and amazingly the hotel is buzzing with volunteer activity even at that hour. Folks are serving the riders Dunkin Donuts coffee and muffins, mechanics are pumping tires and performing last-minute adjustments, and hundreds of supporters line the start to cheer us on. Once all the cyclists are up, the place becomes a zoo. Not only do we need to eat, but we need to find our bikes and place them in the correct corral so the fast riders aren’t mixed in with the pedestrian riders (and vice-versa).



Thousands of cyclists crowd the starting line



This year, I made a huge mistake. Because the place was so crowded I decided to skip breakfast and fuel up at the first water stop 20-miles into the ride. Not a good idea, especially when my tank was near empty from riding the previous two days. You would think I was a rookie!

One of the most difficult parts of the Saturday ride is the mile long Muggett Hill in Charlton. This is early in the ride when thousands of riders are still bunched together and all too often a slower rider overestimates their abilities and starts with the fast group but then slows to a crawl on the uphill. When this happens it can become dangerous with riders changing their lines to get past the bottleneck. I came across one such rider on Saturday and asked her if she’d like some help. “What do you mean” she asked. At that point I placed my hand on the small of her back and pushed her up the hill while riding alongside. She was able to keep pace with the group and kept thanking me over and over as we rode along. No sooner had we reached the top that I realized my expending more energy on the climb was causing me to *really* wish I hadn’t skipped breakfast. The first rest stop couldn’t come soon enough – I was starting to bonk and wondered how in the world was I going to ride 112 miles today.



Riding in the Paceline behind Steve Weiss aka "Big George"



I ate a sensible amount at the first rest stop and then suffered alone for the next 20 miles since the number of cyclists, all wearing identical PMC jerseys, made it next to impossible to find the other members of my team. When I arrived at the next rest stop, my friend and teammate Ellen Kirk saw me sitting on the grass by one of the food tents. She could tell I was struggling and without saying much, picked up my bike and rolled it over to the area where the rest of Team Huckleberry had started to congregate after finding one another. “No Huck left behind” has been a motto for our group and on this day I got to understand what a wonderful sentiment that really is. For the rest of the day, I rode easily in the slipstream of my friends and gradually recovered enough to finish the ride feeling strong. It’s said that one uses up to 30 percent less energy when riding in the back of a paceline. Thanks Ellen!

Team Huckleberry at the cemetery with Mike

 

I’m so happy that I was able to hook onto the Huckleberry train because the rest of the day was so memorable and I was pleased to be able to share it with them all. First, we took a planned ¼ mile detour off the PMC route so that we could visit the cemetery in Berklee where Mike’s wife and mother were buried after having lost their battles with cancer many years ago. The team rode quietly into the cemetery and stopped giving Mike an opportunity to share a few thoughts with us all. Coincidentally, another good friend (and PMC rider on sabbatical), Seth Dillingham also has family members buried at this cemetery too. All who ride the PMC have been touched by cancer in one way or another. Standing silently in that small private graveyard certainly reminded us once again of the reason for the ride.



The Davis' in Lakeville -- Mom wearing her Living Proof Button

After rejoining the PMC route, we rode to Lakeville where a Pedal Partner Picnic was scheduled for Hannah and all the other Jimmy Fund patients adopted by other teams. Sandy and the boys along with my folks planned to join us there too. Seeing my mom on Saturday has become a PMC tradition for me and it’s always an emotional experience for both of us. And once again, mom would be wearing the “Living Proof” button that I had given her after my first PMC in 1998. As we neared the water stop, the road was lined with posters of the children participating as Pedal Partners and was another telling reminder of the reason for the ride. Seeing my boys interact with Hannah – Dan playing catch with a beach ball, for example – made me feel that my kids “got it”. That it is important to be compassionate and kind to everyone, especially those in need. We spent at least an hour in Lakeville making sure that the Hughes family got a taste of what the PMC is all about. In the end, my friends, family and I came away having received more from Hannah than we could possibly have given. She and her family are a wonderful example of strength and courage.

A high-5 with Hannah before heading out on the road again

While my body was feeling better as Saturday’s ride progressed, something began to go wrong with my bike -- it developed an annoying click with every rotation of the pedals. At 90 revolutions per minute and with a couple of hours left to ride, it was driving me crazy and undoubtedly driving my teammates even crazier. Click, click, click… In any event, we arrived safe and sound in Bourne and would soon shower, change and enjoy plenty of food and beer. But first, I took my bike over to the Landry’s bike shop repair tent and they completely overhauled the drivetrain on my bike and fixed the problem. The pedals turned smooth as butter and were quiet too. Awesome!

Look Ma, no pedals

Saturday’s ride ends at the Mass Maritime Academy and the school grounds are turned into party central. There is a tent that would make Ringling Brothers’ big top look small. Thousands of riders and volunteers mill about eating hamburgers, clam chowder, pizza, baked potatoes, and just about anything else you can think of. Live bands play set after set of music and hundreds of massage therapists volunteer to help ease the aches and pains in the riders’ legs and backs. Over the years, the PMC has gotten bigger and bigger and one of the downsides to this growth is that it sometimes becomes hard to find your friends. It was impossible to use cell phones because so many riders inundated the towers and consequently the lines were jammed. My friend and Mansfield neighbor, Tony Bretti, rode the Wellesley to Bourne route and while he was under the tent the whole afternoon, we never saw each other once. Go figure. 

 

As the day turned to evening, the tent thinned out as riders started to retire to their sleeping quarters. Some stayed in dorms, others in tents. I stayed on the training ship and slept in the lowest level berth with 40 plus other guys. The beds were stacked three-high and so cramped that the sailors call them coffin bunks. It didn’t bother me at all and I think I fell fast asleep by 8:30.

The Pan Mass Challenge: Bourne to Provincetown

Reveille came early. At 4 am we were awake and soon learned that it was pouring outside. I joined the throngs heading to the breakfast tent – there was no way I was skipping breakfast today! I grabbed an egg and ham sandwich and stood silently under the tent watching the rain pour down and puddle on the grass. Was it starting to slow down? Yes! By 5:00 the rain was a drizzle and soon it stopped altogether, just in time for our 5:15 departure. Riding over the Bourne Bridge is a big effort on a bike. It’s a steep climb and is crowded with tons of cyclists who are elbow to elbow trying to share space with one another and the occasional car and truck making an early escape to the beach. Once over the bridge, we ride along the Cape Cod Canal and eventually head down Route 6A. It’s a beautiful ride and one of the highlights each year is in Brewster. There, hundreds of campers at the Cape Cod Sea Camp line the street and cheer loudly and enthusiastically as wave after wave of pacelines make their way past the hedge in front of the camp. It’s an amazing feeling and creates quite a surge of adrenalin in me every year. So cool!





Jack and Paul

Right after the camp, the route turns into Nickerson State Park and every year I have ridden the event, a boy named Jack has greeted us. The first year I rode his parents stood there pushing a baby carriage and holding a sign that said, “I’m two because of you.” The first time I saw Jack and his parents, I cried. And in each succeeding year the little boy got older and the sign changed. When Jack turned 8, he passed out little plastic medals to any and all cyclists. Mine still hangs in my office and reads, “Thank you, from Jack.” In 2006 when my son Paul was 15 (the minimum age for riding the PMC), he met Jack at the Brewster stop and I recall commenting to Jack that it wouldn’t be long before he would be old enough to ride too. Well, this year Jack turned 15 and for the first time he wasn’t in Brewster to greet us – he was riding! I saw him on the road too and get this; he was riding with one foot in a cast. He broke his foot trying to land a 360 on his BMX bike a few months before the PMC. Jack was no longer a little boy with cancer. He was a normal teenager doing all the things that 15 year-old kids do. That’s the hope that I have for Hannah too.

Home

Team Huckleberry stayed together all weekend and we arrived in Provincetown around 10:30 Sunday morning. We celebrated another completed PMC and before too long, we were all off on our separate ways. I took one of the fast ferries from Provincetown to Boston and was greeted at the dock by Sandy.  We drove back home to Mansfield where I crashed on the couch feeling both exhausted and exhilarated. The PMC was over, but its memories will continue.



A Happy Group of Friends at the Provincetown Finish Line



Boston Skyline from the PMC Fast Ferry

Sign greeting riders at the dock in Boston



Thanks again for your continued support.  It means so much to me and I'm convinced now more than ever that the contributions we make and the time we spend is making a world of difference in the lives of many.   

 



Quarterly Review -- First Half of 2011

By Steve Davis, CERTIFIED FINANCIAL PLANNER ™

MANSFIELD, MA:  As I write this blog entry, the June 30 investment statements are starting to come across my desk.  I imagine that the US Postal Service has already delivered yours to you too.  You’ll see that the first half of the year has produced modest single-digit gains for most assets classes. 

Market Performance in the First Half
The first quarter of the year showed the markets registering solid gains, despite the effects of Japan’s terrible earthquake and tsunami. 

The second quarter was a different story, with concerns arising from growing inflation threats in emerging markets, debt worries in Europe and a downgrading of growth forecasts for the global economy.  Below are the first-half results for some key markets.

Source: MSCI
Note: Results are in local currencies; the effect of swings in the dollar is not reflected

Here at home, we saw U.S. stocks fall for the first time in four quarters.  The S&P 500 lost 0.39% in the second quarter, a period marked by worries over high gas prices and indications that the recovery was stalling.  Given the above, I want to share a few quotes which I think help us see things in perspective.

Quote #1
-- Warren Buffett, letter to investors published February 2011
“Money will always flow toward opportunity, and there is an abundance of that in America.”

In November of 2009, Berkshire Hathaway spent $26 billion to buy the 77% of rail giant Burlington Northern that it didn't already own. In interviews, Warren Buffett referred to this as "betting on America." Buffett has been consistent in his positive outlook for the U.S. economy, looking past short-term events to focus on America's ingenuity and resolve and its ability to attract the best and the brightest from around the world.

Buffett is consistently voted the greatest investor of all time. In the 46 years he's run Berkshire Hathaway, annual growth in book value has exceeded 20%, more than twice the gains for the U.S. stock market index. Even more remarkable, Buffett's numbers are after tax, while the index's gains are pretax. And while he had lagged in individual years, in his last letter to shareholders, Buffett pointed out that there has never been a five-year period where Berkshire Hathaway underperformed the S&P.

To put his record into dollar terms, $1,000 invested in the Standard & Poor’s index of U.S. stocks at the start of 1965 would have risen by the end of 2010 to $62,620. By contrast, that same $1,000 under Buffett's stewardship would have grown to over $4 million.

Quote #2
-- Bill Gross, Morningstar Fixed Income Manager of the Decade; June 7, 2011
“In terms of the stock market, there are amazing 0pportunities [compared to U.S. government bonds]; there’s a huge gap and a huge differential.”

As manager of PIMCO Total Return Fund, the world's largest bond fund, Bill Gross turned in a track record matched by few others and was named Morningstar Fixed Income Manager of the Decade. In part, this stems from his willingness to take contrarian views: in 2010, he went on record talking about the "new normal" of lower growth, higher inflation, and increased risk in holding debt of governments around the world.

In a June 7 interview on CNBC, he spoke about stocks and said, “Corporations are in the catbird seat. They've got cheap financing, cheap leverage. They've got cheap labor and the ability to move from one country to another at their will. And so corporations basically have done very well, and will probably continue to do very well.”

What this Means to Investors
In today's low-interest-rate environment, it's hard to make a compelling case for cash except as a portfolio diversifier and a source of liquidity.  As for bonds, Bill Gross represents the growing sentiment that the risk in bonds is rising as economies recover and interest rates start to rise.
This leaves stocks.  Whether you adopt the "lesser of two evils" view of stocks as opposed to bonds, like Bill Gross, or join Warren Buffett in embracing stocks more enthusiastically, there are clear values in high-quality stock market investing.

In Buffett’s annual letter, he encouraged his shareholders to see through the haze.  He wrote, “Commentators often talk of ‘great uncertainty.’  Throughout my lifetime, politicians and pundits have constantly moaned about terrifying problems facing America. Human potential is far from exhausted, and the American system for unleashing that potential remains alive and effective.”
Here’s what I wrote last quarter, and I continue to believe this is the way forward:  We've always had unexpected events and always will. And despite these unforeseen events, economies have grown, companies have prospered, and stock markets have generated positive returns. The key to benefiting from this long-term growth has been to diversify so that no single event can create permanent damage to your portfolio.

I believe that investors with a balanced approach and a long-term view will be well rewarded. The approach to risk management I recommend may not be fun or sexy in the short term, but all the evidence at hand suggests that over time it will serve you well, getting you to your goals with the least amount of stress and distress along the way.

Happy Groundhog Day?

By Steve Davis, CFP®

As I sit here typing, the snow continues to fall.  It looks like we're in for at least another six weeks of winter no matter what the legend of Punxutawney Phil says today.  In fact, it wouldn't surprise me to learn that the good ol' groundhog can't even burrow out of his lair because he's burried under too much of the white stuff.  The way I see it, all this snow will be hanging around 'til at least June! 

We're trying to make the best of it here in Mansfield; I've taken up snowshoeing and the kids have moved beyond making snowmen and have progressed to making all sorts of interesting snow structures.  After the first storm of the year, our boys constructed a snow couch in the front yard.  We used the couch as a prop for a long overdue family photo. 

 

The Davis Family - January 2011

I share this portrait of Sandy and our boys because I work hard not only to serve my clients, but also to provide a nice life for my family.  It is on behalf of my family that I offer you thanks for your business, friendship and trust.  And if you're not yet a client, and would be interested in learning more about what I do, please give me a call at 508-337-9400. 



Here are a couple more snapshots from that fun day.  The first few pictures show the couch and coffee table during "construction".  Later, after the sun came out, Sandy added the decorative touches and directed the photo shoot.  If your family is like mine, every group photo session usually ends with a call to "act silly".  Somehow, I don't think we'll be sending the last photo out with our Christmas cards next year...

 



To cap off the weekend, my oldest son and I went snowshoeing at the Moose Hill Reservation in Sharon, MA.  He is now a sophmore at VCU and was planning to leave for Richmond later in the day.  This was the perfect opportunity to get some one-on-one time together before the end of his holiday break.  It was a gorgeous day all around.