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marcfrey150Skip this column if all your stars are aligned and you are in perfect harmony with yourself and the world. All others may read on.

Somewhere along in 2012, I started to feel overwhelmed with the sheer amount of information raining down on me, the fast pace of change, the vastly different interpretations on how it affects mankind, and my own efforts to keep up with it all. If you have ever experienced the feeling of being exhausted and confused because your mind is racing at 150 miles an hour, processing loads of information and asking yourself dozens of questions, you know what I’m talking about.

So, I decided that there has to be a better way, and thus reminded myself that the word intelligence comes from the Latin word “intelligere” which means to see through things. We all know the Johnny Nash hit song “I can see clearly now,” and that is the feeling we would like to enjoy more often in our lives. So how do we get there?

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marcfrey150Stop ringing the bells! I was just about to write another cheesy note, full of clichés like, “This is the time to count our blessings and give to somebody that needs it more than ourselves.” While I encourage you to do that, the very smart readers of Last Call already know that, and are not looking for me to state the obvious.

So I was wondering what makes readers come back to this page, and why it solicits spontaneous reader comments from all walks of life. Maybe it’s because I write from the heart, maybe because I try to cut through the noise and try to put issues into perspective or provoke my readers to think about a topic in new terms. Whatever it is, I feel grateful for the opportunity and the feedback I receive.

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steven_mugThis past year turned out to be a year marked and paced by the political process, beginning with hotly contested primaries, two emotional conventions, three cliffhanger debates, and now, the aftermath of the election and a lame duck Congress.  Once again, the United States has proven a shining example to the world of how the democratic process works, even in a sharply divided nation.  Over the last eleven months financial markets have had to contend with the infamous Facebook IPO, weather-related market closings, the East Coast economy savaged by Superstorm Sandy, the Fed’s “Operation Twist” and “QE3,” multiple flareups of the European debt crisis, and a generational changeover of leadership in China. We reveled in a strong market rally from January until May, suffered through a summer slump, saw gains return through the end of October, only to retreat in November.  The real estate market, so far a no show in the recovery, finally began to show signs of life.  2012 has been in turn a challenging, maddening, frustrating deflating, turbulent and triumphant year. Now, with 2013 just over the horizon, here are a few things to prepare for, and some things to attend to, before the year ends.

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last-callThrough my recent involvement with, the Island School Council for the Arts, a local not-for-profit organization that enhances art education in schools, I had the opportunity to think more how art affects our lives.

Imagine for a moment a life without the arts:

We would all be wearing the same boring clothes, driving the same non-descript vehicle, eating tasteless food, sitting in front of blank TV screens with no movies to entertain us, we wouldn’t be able to sing along our favorite songs or dance the night away… you get the picture.

Some form of art is everywhere in our lives. Artists make us think, wonder, laugh, cry. Artists color and shape our world and make it more livable, more enjoyable, more memorable. In one sentence: “Art adds value.”

Nobody could have said it better than Steve Jobs: “Technology alone is not enough — it’s technology married with liberal arts, married with the humanities that yields us results that make the hearts sing.”

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marcfrey150Yes you are! The power of marketing is everywhere in our lives, influencing our way of thinking and even dictating the way we feel about things.

How else is it possible that the color pink is exclusively associated with girls; how is it possible that a simple folded pink ribbon symbolizes the fight against breast cancer without the need to put one single word next to it? Think about that for a moment…

I venture to say that it is not often that we reflect on the outside influences that infiltrate our brains. Unfortunately, there is no class in high school called “Independent thinking 101.” It seems that we simply accept that marketing is a natural part of our lives without giving much thought to how we are being manipulated into behavior patterns or believing things without fact-checking them.

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stevenweberAs investors contend with low yields and the possibility of higher taxes, investments that are tax-free have particular appeal.  Despite some recent high-profile defaults, municipal bonds have an exemplary track record of safety, and bonds issued within the state of South Carolina offer returns that are free from both federal and state taxes. Let’s look at some basic background on these investments, as well as a few tips on getting started.

The state of South Carolina, as well as our cities, counties, and improvement and utility districts, all issue bonds to finance operations, capital expenditures, and development. These bonds have a stated interest rate and a promise of repayment at a specific time in the future, known as the maturity date. The safety of these bonds, both investment income and principal, is determined by the source of the funds designated for repayment. The two major categories of Municipal bonds are general obligation, or G.O. bonds, and revenue bonds. General obligation bonds are backed by the taxing power of the issuer, which could mean income taxes, in the case of state of South Carolina, or property taxes, for bonds issued by a county. Revenue bonds, on the other hand, are backed by revenue from the particular project for which the bonds are issued. For example, bonds issued to pay for the Cross Island Expressway would be backed and repaid by toll revenue from drivers who use the expressway.

 

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marc_frey

13 proven ways to get out of a ditch

 If the rain made you dump your car in a ditch, forget it. Just call a tow truck and let it go. But if you are mentally in a funk, here are some things that might help you find a renewed zest for life:

13. Visit your favorite pizza store for lunch, have a glass of wine and call it a day.

12. Call somebody you feel safe with, meet up and dump it on them.

11. Buy some flowers or, better yet, plant some flowers or herbs or a small tree.

10. Cook your favorite meal.

9. Start a new fitness routine and stick with it.

8. End your evening with some dark chocolate and a single malt scotch.

7. Walk the beach in the rain.

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stevenweberThe future can be a murky place. And let’s face it, anyone in the investment business is always on the lookout for that crystal ball. When investors take a flight of fancy and start mining data for arcane and offbeat ways to predict the economy and the markets, there’s no telling where they will end up. With our attention focused on the Olympics, we thought we would explore what impact the summer games might have for stock investors. It’s not so farfetched to think that a swelling of national pride after a stellar Olympic performance might translate to greater confidence, optimism and positive expectations, expanding P/E ratios and attractive investment returns. But the Olympics are far from the only televised entertainment that can teach us a thing or two about the market.

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stevenweberLast month we discussed some aspects of what the “new retirement” looks like, including the role of working longer past traditional retirement age, as well as properly structuring Social Security benefits. In the second part of our article we’ll talk about why a written investment and income plan is such a critical tool when planning your income and investment strategy in retirement.

Why in writing? The very process of articulating your goals and objectives on paper or screen can give an individual the grounding to stay focused in an unsteady investment environment. A good plan can provide continuity and coherence to investment strategy and activity. It should include a target asset allocation as well as restrictions based upon the investor’s age, need for income and growth, and tolerance for risk. It should also outline an investment strategy that can be pursued in a variety of market and economic conditions.

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marcfrey150Nobody has time to read, never mind to think

By Marc Frey

Instead of writing the usual 700 words about one topic, and given that we are in the middle of summer, I opted to go with short snippets of thoughts instead. If any of them grab you, e-mail me. It might motivate me to expand on the idea in a future column.

"I'm so energized about the future, but depressed about the present "


I mentioned that in a business conversation, probably expressing the sentiment of many small business owners. Real entrepreneurs always find the energy to come up with new plans, yet see the current economic conditions and the inability to get bank financing as a real hindrance to implement these plans. One has to wonder why government programs always tend to favor big business but don't give small business its fair share of support in helping to reduce unemployment.

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Most investors understand that the companies they put their money in may have business plans and market objectives they may not totally agree with, or sell products they don’t use or approve of.

moralcompassStill, they are generally willing to overlook this if the company is profitable and produces a good return. Mutual funds have specific investment objectives and limitations as well; in the past we have written about funds that include environmental, religious, or moral constraints in what they buy. So, what should you pursue for investment survival — vice or virtue? Here are two funds; both are highly rated, but with very different objectives.

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marcfrey150This month I want to follow up on my last two articles and bring light to a local topic.

ibrains

Readers of my column will remember that I wrote about smart phones and how they could, in essence, take control of humans. Just weeks after my predictions were published, an Intel-commissioned white paper about the future of mobile technology concluded that “connected devices interfacing with the human brain is an inevitability.”

Here’s how the paper’s authors, from consulting firm Booz Allen Hamilton, put it: “As convergence continues across device types, functions, and capabilities, the melding of mobile technologies directly into the human body becomes the logical next step.”

The only question for me is: Who is in control? Humans, the machines or a third-party entity like the government? The fact that researchers believe that this is no longer science fiction but likely to become a reality does not solve the ethical and moral issues that are associated with such advances. Could it be that we are developing technology that is too smart for our own good? I ask because we could ultimately lose control over our own destiny. Then again, maybe I’m simply too old-fashioned to realize that having your own will and privacy are a thing of the past?

I urge you to send me your feedback on this topic.

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marc_freyIf one would have to summarize what characterizes Americans, four words suffice: We like to win!

So it should come as no surprise that we are slowly but surely on the rebound. After shaking the memories of the 9/11 attacks, followed by the occupation of Afghanistan and Iraq, the near meltdown of our financial system and one of the longest recessions on record, there are signs of optimism everywhere.

Trend spotting is not a science but rather a deduction based on unrelated events that point in the same direction. A few years back I predicted in this column that the United States had not seen the best of what is yet to come. I based that on a few major fundamentals, including that we are uniquely adept at combining science, capital and entrepreneurial drive into forward momentum. We are not afraid to try out new things, fail, and then try again.

How cool was it to see a Boeing 787 Dreamliner (assembled in North Charleston) fly low over the 18th hole during the RBC Heritage? Well beyond soliciting a few “Oohs” and “Aahs,” that plane served as a clear reminder that manufacturing in the USA is back.

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stevenweberLast month we examined the case for international diversification in stock and bond portfolios, and reviewed currency risk, which can have a dramatic impact on the returns U.S. investors receive from international investments. This month in part two we focus on regulatory and political risks, and conclude by looking at investments you can use to effectively implement global diversification.

It’s easy to take it for granted, but the accounting and regulatory environment we enjoy in the U.S. provides investors with audited information, a system of financial oversight, and a (mostly) level playing field.  While accounting and reporting standards in some other developed markets are comparable, they are by no means identical. Moreover, many capital markets, especially in developing counties, lack stringent regulation, consistent reporting standards, market liquidity and shareholder rights legislation.  In some markets, loose or unconventional accounting standards make it very difficult to compare results among companies and industries; investment decisions made in these less-than-ideal environments can be very challenging.

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