Those Predictions Again - WVRC on January 19th
We began with the Pledge, led by REZA BUNDY. The Song was America, led, sometimes, by both LENNY FRIEDMAN and PP STEVE SCHERER, but accompanied in either event by RICK CULLEN (who apparently wasn’t too nervous to play, even with the thought of his first major professional address to WVRC looming). MARK BLOCK followed with the Invocation, first allowing us to be seated. He thanked our Creator for the good deeds performed around the world by Rotary, and asked blessings on our Financial Advisors in their shortly forthcoming presentations. This created so much hilarity that further thoughts were drowned out, but MARK, you did set a good tone!
President DON stepped in to provide the weekly story. A Mafioso Don learned that his bookkeeper had stolen twelve million dollars from him. The bookkeeper was deaf, and this was considered very important in his hiring, since he would be unable to testify in any subsequent court hearings. The Godfather included his attorney in the confrontation with the bookkeeper, since his attorney knew sign language. The first question was, “Where is the twelve million bucks hidden?” which was conveyed in sign language to the bookkeeper. His reply, also translated from sign language by the attorney, “I don’t know what you’re talking about”. The Godfather then pulled out a 9mm Peace Pistol, placed the barrel against the temple of the bookkeeper, and asked the same question again, followed by the statement that he would kill him if he didn’t get an answer. After translation by the attorney, the bookkeeper replied, “OK, you win. It’s buried behind the shack in my cousin’s backyard in Queens.” The Godfather asked, “What did he say?”
The attorney replied, “He says you don’t have the courage to pull the trigger”.
We had a visiting Rotarian from Sherman Oaks, a partner of LEE DUNAYER – Danny Kim, who sat at my table, busily taking notes during the presentation (no, he really didn’t take notes, but I figured this would get your attention…) CHRIS BRADFORD and ELLIOTT TURNER both claimed credit for their Special Guest, Florence Sampson, who is in Business Management. This is her required second visit with us – and speaking editorially, it wouldn’t be fair to hold against Florence that CHRIS and ELLIOTT are her sponsors…PDG ANDY ANDERSON brought Pat, and Tim Smith was introduced by KACY ROZELLE.
There were several announcements
January 27th – Copenhagen convention information lunch at the Hacienda Hotel in El Segundo – MIKE GINTZ or CHRIS BRADFORD are contacts.
Feb. 11th, the Valentine’s Brunch at Lawry’s - forty bucks, and SEAN McMILLAN is the person to see.
March 4th – the Corazon project, building a house in Tijuana. KACY ROZELLE reminded us that WVRC will be handling this alone this year, so we need more volunteers than last year – and it’s OK to bring 10-year old kids or older
27 June to 30 July - the Japan Student Exchange, followed by the visit of the Japanese kids here. It’s a wonderful program – my daughter did it some years ago, and it’s open to children or grandchildren of Rotarians. Cost per person is $3,500, shared with the Club.
RI Convention, Copenhagen – information lunch at the Hacienda Hotel in El Segundo next Friday, January 27th. Contact is MIKE GINTZ or CHRIS BRADFORD.
LEE DUNAYER is seeking members who would be mentors for a lunch with some 25 students - the professions, mostly.
The Program
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RICK CULLEN
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LEE DUNAYER
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LEO TSENG
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PP STEVE SCHERER emceed the Financial Advisors program. He began by retelling the DON NELSON golf story, and then had some history to pass along. The last increase was in 2003, when the market went up 25%. 2004 and 2005 were pretty much even, which is expected. The annual increase, on average since 1896 when records were first kept has been 6.7%, but in 2005 it declined. There are a number of factors that enter into making predictions, and Contrarians also have a voice.
At this point a voice from the audience (could it be SEAN?) asked about a report on what they predicted for 2005, to which PP STEVE replied he “was getting there”. Last year our members expected the DOW to go up from 10 to 15%, with the S&P and Nasdaq going up from 5 to 10%. Our advisers expected the DOW to go up to 11,585, a 7.4% increase, with S&P at 1251 or a 3.3% increase, and Nasdaq ending at 2939, up 2.9%.
The DOW was way wrong but the other two were pretty close. They also selected a portfolio of moneymaking stocks. If you invested $10K in each of the six stocks suggested, at the end of 2005 their worth would be $55K! The audience survey today was that the DOW would be up about 4.5%, Nasdaq up 6% and the S&P up 5%. Both short and long term interest rates were expected to go up about 5%
DONN CONNER gave his notes to PP STEVE to read. DONN has his own firm, and he expects the following at the end of 2006 – DOW, 12,000. S&P, 1335, and Nasdaq 2400. He likes Pfizer as a stock.
RICK CULLEN was up next – his first time before us. He is with the 1st Regional Bank. The DOW – which he doesn’t think is an accurate indicator anymore – to finish at 11,500, Nasdaq at 2575, and S&P up 11% (but I didn’t get a number – sorry) . His stock pick, in the healthcare field, as all were to be this year, was Sunrise Senior Living. He reminded us that we were designed to “wear out”. And of course someone in the audience said he thought the first word was Sunset, not Sunrise. And he did point out that he wasn’t responsible for last year’s predictions!
LEE DUNAYER came forward – he is with UBS Financial Services. He expects a downturn, with Nasdaq down about 2% and both the DOW and S&P down about 2.5%. His stock pick is SLT, which is on the American Stock Exchange. He likes mutual funds, and believes in hedging your bets.
DICK ROBINSON gave his notes to PP STEVE also. He is a Registered Investment Advisor, and he expects the DOW to end the year at 11,360, Nasdaq at 2475, and S&P at 1323. He likes Johnson and Johnson as a healthcare stock.
LEO TSENG felt he deserved a medal for showing up today, after the advisors record of last year – “Its tough to face a firing squad”. Someone in the audience said he was using a dartboard five years ago, and he opined as how he maybe should have had one in 2005. He picked General Motors, so if you followed his advice, you lost half your money! He reminded us that Kirk Kerkorian’s purchase of GM stock at $31 – now selling at $20 – cost him 900 million dollars, but he still would like to be Kirk’s broker. LEO has been with Merrill Lynch for sixty years, and his stock pick is HCA. He expects the Dow to end at 12,000, S&P at 1348, and Nasdaq at 2530. In conclusion, he reminded us that Pension Plans are currently under funded by some 40 BILLION dollars – a real concern.
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SHANE WAARBROEK
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PP STEVE SCHERER
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SHANE WAARBROEK is also with Merrill Lynch – he and LEO are off iced close by each other. SHANE expects the DOW and Nasdaq to grow by 5%, with the S&P going up 8%. His stock pick is SSH (and SHSSS), which is a diversified company. He expects the large cap and medium cap growth companies to perform better than the lower category. He also prefers international markets better than domestic and he considers the most volatile situation in the world, potentially, is what happens next in Iran.
PP STEVE SCHERER was our last predictor – he has his own firm, also. His stock pick is Medtronic (hope I heard that right) which has been his pick the last two times also. He expects the DOW to end at 11,750, Nasdaq at 2390, and S&P at 1350. He then gave us a homework Assignment – we should read “The World is Flat” by Friedman. It is very thought provoking (and I’ve been told that by others, also).
Thanks to our Advisors – let’s see where we come out when 2006 ends!
To ponder – if love is grand, divorce is a hundred grand.
