NEWS RELEASE: Tampa Asset Management Celebrates Successful First Year Anniversary

For immediate release:

INVESTING IN CLIENTS, NOT WALL STREET
Local Tampa investment advisor celebrates firm’s successful one year anniversary with over $95 million dollars of assets under management, and total freedom from commissions and corporate hidden agendas.

South Tampa, FL—Bob Garey, CEO of Tampa Asset Management, LLC, has twenty-five years of experience providing investment advice to families and individuals, most of it spent under the auspices of big name firms like Shearson/American Express, Smith Barney and Wachovia Securities. In December 2008, after the near collapse of several of the biggest banks and brokerages fueled increasing turmoil in the minds of investors, Bob took the financial bull by the horns and went independent, founding the fee-only registered investment advisor firm of Tampa Asset Management, LLC.

“Founding a new registered investment advisor (RIA) firm at a time when trust in the market was at an all time low was a big leap,” says Bob, “but if I had no confidence in the current system, how could I expect my clients to? It made sense to go independent, and take my clients with me. They weren’t just faceless, numbered accounts—they were people, many of whom have become personal friends.”

A January 2009 article in The Wall Street Journal¹ supports Bob’s strategy, citing how financial turmoil and tarnished reputations have resulted in a major shift in the financial industry as assets are transferred away from big name brokerages and into low cost custodial accounts at neutral firms like Charles Schwab and TD Ameritrade, to be managed by registered investment advisors like Tampa Asset Management.

Most of Bob’s original clients opted to follow his lead, transferring their accounts from his former brokerage firm into low cost custodial accounts, which he manages on a fee-only basis. One year later, he’s certain everyone involved made the right decision.

“What people may not realize is that RIAs like Tampa Asset Management have a fiduciary responsibility to act in each client’s best interest,” Bob says. “Brokers and insurance agents, who charge commissions for the products they sell, do not. Simply put, our registration with the SEC holds us to a higher standard, and our clients are the ones who benefit. My clients receive all the benefits of the personalized financial guidance and management I was giving them before, with lower costs, no hidden fees, commissions or corporate agendas,” Bob states. “It’s a win-win scenario for everyone involved, except the big banks and brokerages.”

⁽¹⁾E.S. Browning, “More Brokers Flee Big Firms, Taking Investors With Them”, Wall Street Journal, 1/4/2009

Bob Garey has a B.S. in mathematics and an M.A. and Ph.D. in political science from the University of South Carolina. Prior to his graduate studies, Bob was a pilot and captain in the U.S. Marine Corps. After receiving his doctorate, he was a research associate at Oak Ridge Associated Universities in Tennessee. He and his wife, Terri, have three children, are active in the South Tampa community, and are members of Logos Dei Community Church.

Visit Tampa Asset Management on the web at http://www.tampaasset.com/.

Contact info:
Bob Garey at Tampa Asset Management, LLC
4221 W. El Prado Blvd.
Tampa, FL 33629
813-675-8011 (office)
813-390-2577 (cell)
bob.garey@tampaasset.com

“Will you be able to afford to retire?” – Investment game plan for 2010 if you have less than 10 years to retirement.

We all hope to be able to retire some day with peace of mind, knowing that we will have enough money to last throughout our lives. Unfortunately, many Americans in their 50s and early 60s lost a lot of money in their investment accounts and IRAs in the last two years. Now they wonder if they will ever be able to retire. Does this describe you?

Adding to the confusion is the wide range of predictions about where the stock market is likely to go in the months ahead. Many commentators, who are looking at our well-known problems (the declining dollar, mammoth new government debt, high unemployment, etc.), look for another big decline in the stock market. Others, who see the glass half full (because of a simultaneous recovery from the recession beginning around the world, rapid corporate earnings growth, low interest rates), think the market may go much higher. The truth is, it’s too early to tell which will be right. So where does that leave you? You need to rebuild your portfolio so you’ll have enough money to retire, but you don’t want to take too much risk and lose a lot more money. How do you go about it?

The first and most important step is to have the right mix of stocks (for growth) vs. bonds, CDs and cash (for safety and income) for your needs. There’s no one pat answer or formula. The best mix for you (called “asset allocation”) depends on a number of factors, such as: How many years will it be till you retire? How much annual income will you need from your investment assets when you retire? What is the size of your portfolio now? How much will you be able to save each year? How do you emotionally handle losing money during market declines?

Don’t take too much risk for you. It’s great to try to build up again. However, if you have a short number of years to retirement, don’t take so much risk that you won’t have enough time to build back up—if the market has a big downturn again. Also, don’t have more in stocks than you can psychologically endure if the market has another big drop.

On the other hand, don’t be falsely conservative. After last year’s market crash, almost everybody felt afraid of losing even more money. It’s been very tempting to say goodbye forever to the stock market, and keep everything in government bonds and CDs. However, if you plan on retiring in a few years but no longer have as much money as you should at this point, it’s probably not a good plan to put everything in CDs—even though it might make you feel better. Having some amount in stocks will give you a better chance of building up to the amount you’ll need—and thus may actually reduce your risk of not having enough money to retire. If you are close to or just entering retirement, and have everything in CDs, inflation will steadily eat away at the buying power of your income each year. Having some of your assets in stocks may help you keep up with inflation in the years ahead.

As the stock market goes up, gradually reduce the percentage you have in stocks. As stocks rise, you will be gaining on the amount of money you’ll need to have when you retire. Use the opportunity to reduce your risk of loss by cutting back a little on your weighting in stocks. If the market goes up more, reduce your risk even further.

Prepare for an increase in interest rates by investing your bond and CD money in very short maturities. Eventually, probably in the second half of 2010 or in 2011, interest rates will start going up—perhaps a lot. While interest rates are low, resist buying bonds with maturities longer than 2 – 4 years. Better yet, invest money you would normally put into bonds in CDs instead. That way, you’ll be ready when higher rates come.

Don’t base your investment plan on your feelings about politics. Political swings to the far left (or right) in American politics have always come back to the middle (over the last 225 years, at least), and they very likely will again. At any rate, political news, forecasts of the economy, and other news events tend not to be useful indicators of which way the financial markets are going to go.

Interest Rates Are Low, Which Means Bond Prices Are Very High. Resist Buying

The government is in a pickle. The Treasury is spending itself into an ocean of new debt in the name of fixing everything. Last fall, Congress funded $700 billion to bail out the big Wall Street banks and brokerages, and this year it passed a $787 billion "stimulus" bill. The proposed health care plan will cost upwards of $900 billion, and who knows what will come up next. Meanwhile, tax receipts are lower because we are in a recession. So, that means it all has to be borrowed-to the tune of $1.5 trillion or more this year alone, and $9 trillion over the next decade. Ouch.

The way the government borrows money is by issuing treasury bonds-so that's a lot of new bonds to sell. So far, interest rates on treasury bonds have stayed very low, in part because investors are still gobbling them up (because they're afraid of the economy and the stock market, and want to feel safe). Individual investors now own $606 billion of treasury bonds (mostly through mutual funds), up from $240 billion at the beginning of the year. In addition, the Federal Reserve Board is right beside investors, printing enough money to buy nearly half of the treasury bonds being issued this year. All of this has kept treasury-and other bond-prices high and interest rates low in 2009 ("Eager Fed Helps Keep Treasury Rally Alive," WSJ 9/21/09 page C1).

This won't last forever. At some point-I believe in the next year or two-yields (interest rates) will rise and treasury bond prices will fall. This could be triggered by a precipitous decline of the dollar, an increase in inflation, the Fed stopping its purchases of treasuries, or just a general upturn in the economy. When treasury prices fall, they will likely drag other bond prices down with them, at least somewhat.

Recommendations: (1) Hold on to your high quality corporate and municipal bonds, especially if you bought them at or below par (face) value as TAM recommends. (2) Consider selling treasury bonds with maturities longer than five years if you purchased them in the last 15 months (when yields have been very low). (3) Most importantly: for now, invest new money that you would normally put in bonds (including money from matured or called bonds) in CDs or high quality bonds with maturities of 3 years or less. Wait out this low interest rate period with short maturities, and I believe you will be able to lock in higher rates when they mature in a year or two.