DreamWorks Capital Management’s 2012 Third Quarter Investment Letter, When Planning and Hard Work Payoff

DreamWorks Capital Friends and Clients,

Please find attached DreamWorks Capital Management’s 2012 Third Quarter Investment Letter, When Planning and Hard Work Payoff

The biggest news of the quarter, besides the equity markets impressive double digits return through the end of Q3, had to be the announcement by the US Federal Reserve to launch what we are calling “QE Unlimited”. 

The Fed is set to start buying back $40B worth of mortgage backed securities each month until it sees a turnaround in the economy and more specifically the unemployment rate.  Maintaining artificially low interest rates isn't doing much to stimulate the economy in any meaningful way.  One consequence of the Fed's low interest policy, has been to hurt the savers of this country.  Lower interest rates basically force people into higher risk assets in order to achieve the possible returns that they are looking for in order to produce income or achieve their financial goals. 

Whether you are receiving any interest or not, having a consistent and dedicated savings plan is still the prudent approach to take in order to accomplish financial and lifestyle goals.  As we stressed in this quarter’s lecture, Balancing Your Changing Investment Needs, emergency planning which should be your first priority within the wealth management planning process.  Having and maintaining an emergency fund is more than just having some money sitting in a liquid savings account.  This type of planning helps to protect your assets and can get you through life’s volatile storms, which is the basis for our case study this quarter.

Feel free to call if you would like to discuss our Outlook, your investments, or those of a client or friend.

Warm regards,

Paul Fenner, ChFC

President

DreamWorks Capital Management LLC

(248) 860-2279

pfenner@dwcmllc.com

www.dwcmllc.com