We continue to emphasize investing in dividend paying U.S. equities.  We anticipate that after this past week’s euphoria regarding the European Union, economic fundamentals will be the focal point and many of the European economies will struggle to show growth.  December 9th is the next big intergovernmental meeting.

The emerging markets, including China, have already felt some impact from Europe.  China’s manufacturing sector declined in November, purportedly due to higher inflationary pressures and a decrease in demand from Europe.

We still do not see interest rates rising dramatically until economic activity becomes more robust (unless a bond buyer strike occurs like Spain and Portugal are experiencing).  With Europe being a drag on global economics, as we saw this week, Central Banks will be in a very accommodative and perhaps easing mode.  Because of the lessons learned during the financial crisis in 2008-2009 (which was really a liquidity crisis), the Federal Reserve and other central banks will provide as much liquidity as necessary to avert bank runs and to help the world grow out of our debt problems.  This will be in spite of all the current negative press regarding the $7.7 trillion dollars of loans the U.S. Fed made during the crisis.