M&A Mania:

by Natalie Pace.

Citigroup's Renaissance under Prince, Charles, HRH Sallie and the King of Wall Street, Sandy Weill.

Including a M&A Mania stock report card that lines up Citigroup's numbers with other Investment Banks. Click to access.

Natalie Pace, NataliePace.com CEO and founder

Mergers and Acquisitions are exploding this year, for the fastest start to any year since 2000, when the $164 billion AOL-Time Warner merger was announced. The value of 3,067 deals announced so far, between January 1st and April 30th, equal $414.31 billion, according to Thomson Financial, beating 2005, which saw 3,018 deals with a total value of $361.25 billion, over the same period. During the first four months of 2000, 3,900 deals were announced, for a value of $631 billion.

This year, on Wall Street's new feeding ground, Disney bought Pixar. Ameritrade merged with TD Waterhouse, and e*Trade answered by consuming Harris Direct. Albertson's was bought out. The question is: which investment bank is benefiting most by this bounty of new business? Is it Lazard, the company with an explosive IPO in May of 2005, which has handled over 1000 mergers and acquisitions valued at over a trillion dollars over the last few years? Or is Goldman Sachs still the preeminent investment bank? Does Lazard's restructuring expertise give it a competitive edge, or is Lehman Brothers, one of the most respected investment banks, according to a veteran, attracting more business? And which, if any, of these corporations are still within attractive buying range?

It's earnings' harvest season across the board; however, there is a big difference in how investors have been ranking the companies. All of the investment banks (and divisions) are experiencing record revenue growth in the current M&A environment, and all, with the exception of Citigroup, have had explosive share price gains in the last two years. Lazard reported that revenue rose 32 percent to $355 million from $270 million in the 1^st quarter, and has a share price that is up 60% from its IPO. Earnings were off, however, $19.7 million versus $73.4 million a year ago, due to corporate restructuring. At the time of the IPO, Lazard spun off its Capital Markets and certain of its Merchant Banking businesses. Lazard's price to earnings ratio is the highest of its peers, at 27.10, and all bets are off as to whether the new corporate structure, with reduced earnings for shareholders, will continue to be appealing. Lazard's share price, at $40.57 on May 26^th, is down 25% from the highs set earlier this month, but, even with that haircut, Lazard is still trading high to earnings.

Goldman Sachs generated record quarterly net revenues of $10.34 billion in the first quarter of 2006, 42% higher than its previous record. Investment Banking produced net revenues of $1.47 billion, which means a large chunk of the dough was cooked up on the trading floor, in a favorable first quarter equity and commodities environment. (Hedging bets are off on how well hedge funds do against the mid-May sell-off, and how that will reflect in the earnings announcement on June 13^th.) Goldman Sachs, with an 11.00 P/E, looks like a bargain, but share prices have already increased almost 20% this year alone, and have moved up over 100% since the doldrums of 2002. Not surprisingly, insiders are taking the opportunity, at long last, to jump ship, and have cashed out over $56 million.

source: MoneyCentral.msn.com

Lehman Brothers' insiders have cashed out over $116 million. All this while Citigroup's Board is doing a little insider buying. Citigroup bought back $12.8 billion of its own stock in 2005, another $2 billion in the first quarter of 2006 and has authorized an additional $10 billion in share repurchases.

At a price to earnings ratio of 10.10, the lowest in its class, it turns out Citigroup might be the best, undervalued M&A play on the Street, which is saying quite a lot for the company that was better known for the Jack Grubman scandal just four years ago. Citigroup, ranked #1 in global debt underwriting, #1 in announced global Mergers & Acquisitions and #2 in global equity underwriting, saw investment banking revenues climb by 34% in the first quarter.

Jack Grubman Who? In 2002, Citigroup, like most investment banks, was subject to investigations regarding some of the most notorious corporate scandals of this century - Worldcom, Global Crossing, Enron. Grubman's swapping a favorable AT&T rating to get his kids into an elite preschool in Manhattan didn't help Smith Barney's credibility (SB is owned by Citigroup). In 2002, Citigroup was also being investigated for its association with Enron (along with a dozen other investment banks).

Fast forward to today. Citigroup has one of the largest market capitalizations in the world, at $246.4 billion, and, even with that massive girth, is growing some divisions at a pace of 34%. How does a corporation weather those storms and come out on top? They work fast to isolate and eliminate the problem, and then polish up their product and image, which is exactly what Citigroup did.

By December of 2002, Grubman was gone. He resigned from Citigroup (receiving a healthy severance package), was banned for life from the securities industry and was ordered to pay $15 million in fines. To prove that he was proactive about separating investment banking from equity research, Sanford Weill, the Chairman and CEO of Citigroup, hired the most respected CEO in the business, Sallie Krawcheck, the former Chairman and Chief Executive Officer of Sanford C. Bernstein & Company, to clean house at Smith Barney, restoring integrity to his corporation. Citibank officially settled Enron-related securities litigation on May 24, 2006 for $2 billion, while Merrill Lynch & Co., Barclays PLC, Toronto-Dominion Bank, Royal Bank of Canada, Deutsche Bank AG and the Royal Bank of Scotland Group PLC are hold outs. Sallie did such a bang-up job at Smith Barney that they made her CFO of Citigroup.

On April 18th, when Sandy Weill retired as Chairman and became Chairman Emeritus of Citigroup, he handed over a crystal clean slate to Charles Prince, Citigroup's current Chairman and CEO, and the corporation couldn't be healthier. Record revenues at Smith Barney were driven by a 32% increase in fee-based revenues and a 4% increase in transactional revenues. Net income increased 19%. Credit costs declined, with lower bankruptcy filings and a continued favorable credit environment. Citigroup is opening their first private bank office in Mainland China, and has added over 5,500 ATMs to 7-11s across the U.S. And investment banking revenue has more than tripled, shooting up to $6.9 billion in 2005 from just $2 billion in 2004, with revenues diversified around the world, including 39% in the U.S., 19% Asia, 17% EMEA, 10% Latin America, 8% Japan and 7% Mexico.

Brad Sorensen, senior sector analyst for the Schwab Center for Investment Research, writes, "Historically, financial stocks have substantially outperformed after the end of tightening periods." Commercial banks, like Citigroup, actually benefit from increasing interest rates, which could hurt investment banks that rely more upon strong equity markets and trading for their returns. So, if the Feds stop raising rates, if mergers and acquisitions continue apace, and if the future is true to the past, the investment banks could all still have some upside ahead. There are a lot of ifs in that sentence that can be avoided by patiently waiting to see what the summer and the next Fed meeting will do to the market. And if there is a buying opportunity, it may pay to bet on the bargain-priced dark horse that is currently the underappreciated champion on Wall Street - Citigroup.

"My friends, remember always to strive for excellence and, as you come close to accomplishing your goals, push them out a little further and see what happens. You'll be amazed at what you really can do." Sandy Weill, commenting on his 4.18.06 retirement as Chairman, Citigroup.

Sandy Weill retired as one of the most successful businessmen on the planet. Citigroup has a bigger market capitalization, more sales and higher earnings than the more famous, Microsoft.

Click to access the M&A Mania stock report card that lines up Citigroup's numbers with other Investment Banks.

INVESTOR QUIZ:

Are you a Bull, a Bear, an Owl or a Dodo When It Comes to Investing? Take our quiz and find out!

1. Experts say the most important consideration to maximize returns and minimize risk is:
   1. asset allocation
   2. equity diversification
   3. buy and hold
   4. Buy low; sell high
   5. Cash is king
      
      
2. The top performing asset class over the last 25 years is:
   1. Real Estate
   2. Stocks
   3. Bonds
   4. Gold
   5. Beanie Babies
      
      
3. Within the presidential election cycle, the year with the highest on average returns is:
   1. The year before the election
   2. Election year
   3. One year after the presidential election
   4. 2 years after the presidential election
      
      
4. Which web site has the most unique visitors, the most pages viewed AND the most average minutes per visitor?
   1. MSN.com
   2. Google.com
   3. Myspace.com
   4. Yahoo.com
   5. AOL.com
      
      
5. Which company has the biggest market capitalization?
   1. Microsoft
   2. Cisco
   3. Berkshire Hathaway (Class A & B shares combined)
   4. Citigroup
   5. Altria Group
      
      
6. The third biggest market capitalization?
   1. Microsoft
   2. Cisco
   3. Berkshire Hathaway (Class A & B shares combined)
   4. Citigroup
   5. Altria Group
      
      
7. Mutual funds and institutional investors currently account for 72.6% of Altria Group's market capitalization, which means that your 401 (k), if it has mutual funds, is likely invested in Altria. What industry is Altria involved in?
   1. Solar energy and other renewable energy solutions
   2. Cigarettes
   3. Technology
   4. Banking in China
   5. Gold and copper mining
      
      
8. Which stock market index has brought in the highest returns in 2006?
   1. Amex Composite
   2. NASDAQ
   3. Dow Jones Industrial Average
   4. S&P 500
      
      
9. Which industry group brought in NEGATIVE returns (lost money) during the first quarter of 2006?
   1. Consumer Staples
   2. Biotechnology
   3. Utilities
   4. REITs
   5. Technology
      
      
10. Which index has seen the highest returns since January of 2000?
    1. Amex Composite
    2. NASDAQ
    3. Dow Jones Industrial Average
    4. S&P 500

For the answers, click on Investor Quiz Answers, located at the end of the ezine.

Dad Wants an iPod:

an NataliePace.com online Survey shows that Dads want iPods, flat screen TVs and satellite radio, not ties, for Father's Day!

Apple Computer.

Our online survey currently shows that Dad wants an iPod, not a tie, for Father's Day. In fact, the respondents were Siriusly into electronics gifts this year, with satellite radio pulling in third, just behind plasma TVs and iPods (and other music devices). Massage and pampering and Angelina Jolie tied for fourth favorite gift (so I guess if you don a brunette wig and stop eating for a week, you might score extra points for your spa treatment).

The dreaded tie wasn't the only gift idea to get passed over by the guys visiting NataliePace.com's site. Art, clothes, magazine subscriptions, power tools and manly DVDs (the Sopranos, the Godfather, Lord of the Rings, etc.) were all discarded for the electronics and evening escapades. (So, you'll have to use that velvet painting of Elvis as a gag giftÉ)

Nothing beats just calling up your man's best friend to find out what he really wants, but you could also search around on the gifts for guys' section of the NataliePace.com shopping mall. The NataliePace.com shopping mall links to Apple, Sony, the Ferrari Store and The Berman/Turner Art Gallery, to name a few. The Berman Turner Gallery is hosting a huge art auction on June 11th, with rare prints of famous artists, and not one velvet Elvis. Promise. (Be sure to ask about Michel Tabori's art if you visit or call. His artwork has been selling out, and is regarded by many respected artists and aficionados as the most emotional and innovative new artist to hit the easels in quite awhile.)

Happy Father's Day from NataliePace.com. Hope your day is enRICHing, soul, body, mind and spirit, and that you get that massage and pampering, even if you do open up an iPod.

40 Million Americans Have No Health Insurance.

Is There a Solution? Dr. Gary Becker, Nobel Laureate, has one that could make you rich.

On May 17^th, 2006, NataliePace.com subscribers were treated to a rare one-on-one chat session with Dr. Gary Becker, Nobel Laureate and professor at the prestigious Graduate School of Business at the University of Chicago. Questions ranged from concerns about a declining dollar, to interest rates and gold fever, but no subject was of greater concern than health care. With 40 million Americans uninsured and the remaining 260 million Americans complaining about ultra-high premiums and limitations on care, finding affordable solutions is one of the greatest crises in the U.S. today.

Dr. Becker is actively endorsing health savings accounts as a solution for some of the people in the U.S. who are currently NOT covered by medical care. The HSAs are designed to allow individuals to pay less for health insurance, without additional risk of catastrophic claims, while also enRICHing their own portfolio. Dr. Becker describes how you can contribute to your nest egg during times of health, while saving up for medical needs that might arise in the future - all in conjunction with the much more affordable catastrophic insurance that is currently offered. If you set up a HSA through your employer, there are tax benefits as well! Find out if you are passing up another opportunity to get a free raise from your employer by contributing pre-tax dollars to your own health!

Gary Becker Nobel Laureate, Economic Sciences, 1992; Professor, Economics and Sociology, University of Chicago; FasterCures Board Member

Question: What happens to interest rates (and our economy in general) in the U.S. if the euro supercedes the dollar as the worldwide currency? Iran is talking about using the euro instead of the dollarÉ

Dr. Becker: The dollar will decline in value, but it would not be a major problem for the U.S. economy.

Does the government really need gold as a reserve to back our currency?

No, gold has lost its value as a reserve. This is especially the case in a world of flexible exchange rates.

Are there serious issues with the Federal Reserve being a private institution?

No, the Fed has, since Volker and Greenspan, done very well. It is better off being "private" with some independence from the government.

Why would a health savings account be better than a great life insurance policy (whole life)?

Health savings accounts are very different than life insurance. HSAs help plan for medical expenses while alive. They also allow unpaid amounts to be carried over tax-free to future years. Life insurance pays benefits after death. Unused balances under HSAs are accumulated tax-free. The employer-based HSA also allows contributions to the account each year to be made tax-free. The President proposed extending this benefit also to individual HSAs. I support very strongly that extension.

Can't you draw against life insurance? We take loans out all the timeÉ

One can draw against life insurance, but that cuts benefits if a person dies. A health savings account is meant to provide for medical care while alive without affecting how much life insurance one has.

Do HSAs get refunded when you die or do they go into your estate?

HSAs are not refunded if a person dies, but unspent amounts can be accumulated until retirement and then used as retirement income.

What do you think about Social Security with the Baby Boomers? Are we going to have enough money for them to retire?

There will not be enough unless we either raise the retirement age at which social security benefits are received, cut benefits, or go to a radically different system, such as individual retirement accounts. I support the last, but the present system can be saved with radical changes.

On the PBS program last night, they said there was an extensive study that showed 401 (k)s weren't working as well for the working lower middle class as it does for upper middle and the wealthy. Apparently returns were highly correlated with education and higher paying jobs. So, are the undereducated people in the US getting a raw deal? Are they really sophisticated enough to make their own retirement choices and is there enough information/education available for them to get smart about how to invest?

I agree that the less educated have more trouble making some of these decisions. That is why one needs simple plans. The health savings account is not a complicated idea. Many people can easily understand it.

How much can you put away per person in the HSA per year? $4000 isn't enough for one ER visit!

At present, a family can put away up to $4,500 per year, although the President has proposed raising that amount by a lot. With the accumulation of unused contributions, the value of a HSA can be considerable. But HSAs are not intended for any catastrophic medical claims. That has to be covered with catastrophic insurance.

HSAs sound like they operate like IRAs or 401 (k)s. Is that the basic model? I can buy catastrophic insurance with a high deductible and have the money socked away in the HSA in case I need to pay the deductible and coinsurance, right? I'm guessing that means that I pay less money each month to the insurance company, and have more that I can put in my piggy bank.

HSAs operate like IRAs, etc., only in the sense that accumulated balances are not taxed. But with an IRA, withdrawals are taxed with a penalty if they are made early. That is not true of HSAs if they are used before age 65 for medical expenses. There is no tax or penalty on withdrawals used for medical care.

It sounds like your tax system in the U.S. is not too much different than ours in Canada!!

No. The U.S. system is very different from Canada's in many ways, especially for the far greater role of private insurance and private doctors in the U.S. system.

So, it's an IRA that you use for medical care, kind of like that plan for education, right? Is this forcing people to pay for their own health, taking individuals away from dependency upon the government and the corporation?

The HSA is like an IRA in that it can be used without penalty for medical care. It does give people incentive to economize on spending in order to have more money for future expenses that are more important. In other words, it tries to introduce better incentives into the health system.

The PBS program seemed to be implying that corporations were shirking their duty to employees, that by establishing the 401 (k), they were able to snake out of millions of liabilities and put the burden back on the individual. What do you say to that accusation?

There are no free lunches. Individuals should bear much of the responsibility, along with how much to save and their income at older ages. That all depends upon their savings decisions.

Thank you Dr. Becker for sharing your wisdom. Dr. Becker has his own weekly blog on his web site, which is amazingly easy to read, given that you are receiving the highest level of information and insight about the economy. Click to access it now. I highly recommend that you check it out every week so that you will join the pretty smart ranks of people planning their own riches and retirement.

Keeping Your Sex Life (and Your Heart) Healthy.

by Jessica Mkitarian.

Jessica Mkitarian (on left) and her friend, Sima

Staying healthy is different for womenÑand not just because we are always on diets. Some of us are trying to have a baby, while others are trying to remember to take our pills so we don't get pregnant. With new studies and discoveries everyday, maintaining our health can be as confusing as finding the right diet. Luckily, we had urogynocologist Amy E. Rosenman, M.D. and cardiologist Sandra P. Fallon, M.D. give us some important information and advice on women's health issues. Both doctors spoke at the "Think Pink for Women's Wellness" luncheon that was held to raise money for the Irene Dunne Guild of Saint John's Health Center in Santa Monica.

Birth Control: The Patch vs. The Ring
The patch contains substantially more hormones than were anticipated, putting women at higher risk for phrombochlebitis (small blood clots). Dr. Rosenman recommended the transvaginal birth control ring, which has the lowest dosage of hormones (a good thing for your body and your mood). Uneasy about leaving a ring in there for a month? Dr. Rosenman said, "Other things have been in there, and the little ring will not make a difference." She also commented on the comeback of Intrauterine Devices. In the past, women experienced a lot of scarring with IUDs. It has been found that this was associated with the string, not the actual IUD. Dr. Rosenman explained that the "string was an area for bacteria to grow," and that has been replaced now. Since the IUD is no longer associated with the same problems, it has re-emerged as a viable birth control option.

HPV and Cervical Cancer
What does HPV have to do with cervical cancer? It is estimated that 70% of women will have been exposed to the Human Papillomavirus in their lifetime. Not everyone gets cervical cancer from exposure to the virus, but HPV is now considered the leading cause of cervical cancer, and smokers run a higher risk than non-smokers of developing the diseaseFortunately, there is a new vaccine that protects against 2 of the 100 strains of HPV. Don't worry, these 2 strains are responsible for 80% of cervical cancers, making the new vaccine an excellent protector against main cancer causing strains. On May 19th, the FDA Advisory Panel voted unanimously to recommend approval of the cervical cancer vaccine, Gardasil, which is owned by Merck.

Trying to Have a Baby?
The optimal age to have a baby is still under 30, nature-wise. Once you hit 40, fertility rates lower, and once you hit 45, they lower significantly. But you can freeze your eggs now, right? Dr. Rosenman said, "We're really good at freezing [eggs]; we're not really good at thawing them. She stated the take home baby rate for frozen eggs is far less than that of frozen embryos, which have an extremely successful take home baby rate. Something to think about while you're trying to decide how and when to fit your career into your plans for a family, or your mother role into your career. As my mom always says, "There's never the perfect time to have a baby. There is never enough money. You never have a big enough house or the perfect job!" So good luck!

The Effects of Estrogen
A Women's Health Initiative Study was put to a stop in 2002, when a link was found between estrogen and increased risks for breast cancer and heart attacks, however recently released data on the study shows that estrogen may not be the villain. The average age of the women in the study was 63, whereas menopauseÑand the need to take estrogen hormones to relieve the onset symptomsÑbegins on average at age 51. It is also possible that women in the study had undiagnosed heart disease prior to taking the estrogen. At any rate, Dr. Rosenman pointed out that the effects of estrogen on a 63 year-old woman who is well into menopause is likely very different than the effects on a 51-year-old woman who is taking a low dosage for a short period of time to ease the most uncomfortable systems of menopause.

When the study was halted, "a lot of women went off all hormones and were miserable and uncomfortable," according to Dr. Rosenman. She suggested taking estrogen if needed for menopausal symptoms, and to take the lowest dosage for the shortest period of time. Also, progesterone, when combined with estrogen, may have more negative side effects than when taken separately; however, this is still being researched.

The Incontinence Solution
Do you leak urine when you cough, laugh, play tennis, etc? Some women think this is just a side effect of giving birth, but incontinence (the involuntary loss of urine) is not normal, according to Dr. Rosenman. There are solutions that are non-surgical and minimally invasive. If you have outpatient surgery, you can even go home the same day, and be back to a normal schedule in a week. Also, ask your doctor about tension free vaginal tape.

Are You at Risk for a Heart Attack or Stroke?
One-third of all women will die from a cardiovascular event like a heart attack or stroke. Women who survive these events are often left chronically disabled and must depend on others for their care. Dr. Fallon gave three questions to know if you are at risk:

1. Did your father have a cardiovascular event at age 55 or younger?
2. Did your mother have a cardiovascular event at age 65 or younger?
3. What is your cholesterol level?
4. Do you have any symptoms on exertion, especially chest discomfort?

Dr. Fallon explained that women don't have typical symptoms for heart attacks. It might be as simple as: Is your chest uncomfortable, and is that aggravated by taking a deep breath?

The Stress Factor
Before manifestations are significant in a cardiovascular event, you start seeing some stress factors. Stress is associated with stress hormones, which elevate blood pressure and increase your heart rate. Dr. Fallon calls these "molecules of emotions," and refers to the book Molecules of Emotion by Candace Pert, PhD who describes the production of hormones from the gut, so pay attention to your "gut feelings." So don't stressÑseriously. Lowering stress can lower blood pressure, and having a blood pressure that is 110 or less will reduce your risk of having a stroke or a heart attack (duh!). Cardiovascular events can also be reduced 20% by lowering LDL cholesterol (Low Density Lipoproteins, also known as "bad" cholesterol) below 70. But Dr. Fallon said to forget "bad versus good," if you have high cholesterol, you need to reduce it!

Diet and Exercise
One of the easiest ways to lower your blood pressure isn't taking a pill, it's exercise! If you want to lower your blood pressure and heart rate, you should exercise 30 to 40 minutes a day, 5 times a week, according to Dr. Fallon. Salt intake is also key; you need less than 2000 mgs of salt a day. As always, fruits and vegetables are important, as they are associated with a reduction in hypertension. Dr. Fallon also suggested looking into the Dash diet. A by-product from all that good food and good exercise: you get a body to rival Jessica Alba, which means more dates, which means more endorphins, which are definitely "happy hormones!"

 

The Irene Dunne Guild is a major support group for the Saint John's Health Center, sponsoring the Angels of the ER (a team of volunteers that assists patients and families in the Emergency Room), the Irene Dunne Guild Neonatal Intensive Care Unit and more. The members of the Guild act as goodwill ambassadors to the community. If you would like more information or would like to donate to the guild, please click to go to their website:

Jessica Mkitarian is currently an undergraduate junior studying economics at Boston University. She enjoys writing and travel, and plans to continue her studies, and obtain her Masters in Economics.

Beautify Your Space:

Enrich Your Life.

by Gary Kobat.

"By expressing your intention to improve the energy in your space, and by making a commitment of action to it, you are sending out an infinite wave of higher-level vibration that will positively alter your energy experiences and your abundance in life." Gary Kobat

That's our own Gary pacing Jim Carrey in Jim's first Half Ironman.

You are your environment. A sanctuary and retreat for some, a clear and powerful platform for others, and a chaotic mess - inside and out for even others still. Every inch of every space that you live-in or occupy regularly has an energy, an intent, a flow as an extension of who you were, or who you are now. Photos, light, music, fragrance, color, plants, piles of clothes, papers, gifts, clutter, or even a clogged digestive tract or tired adrenals have a direct influence, an energy about them that either ground and anchor you to a clear and healthy future, or sluggishly hold you back. No different then "you are a walking opportunity" or "you are a testimonial in progress"É make no doubt about it: you are your environment.

Clearing Space, or space clearing is an ancient technique that provides a beautiful way to clear out all of the old, stagnant or chaotic energy in any space, preparing you for new beginnings and positive outcomes. Space clearing offers an opportunity to focus your attention on more subtle, yet profoundly influential factors of a healthy life plan. The act of clearing space not only transforms the energy found there, but it provides an opportunity to become grounded inside yourself, affirming your goals and reflecting on where you are and where you would like to be. This process can be a life long exercise, embracing a more enlightened way of living, eliminating excess baggage, freeing you, clearing your mind, lifting you emotionally, and giving your space new value and new meaning.

One of the most basic rules regarding health is to make sure your space is healthy - inside and out. Keeping it clean, organized, free flowing, and uncluttered is the best way to attract positive, healthy chi or energy into it. Take a few precious moments to ponder your space, quietly observe each room, each area of your body, your mind and your spirit and allow yourself to experience the emotions that arise as you become more aware of what you see.

If what you see or feel makes you feel frustrated, depressed, angry, or any other low energy negativity, use these as your guide. It is here where you begin to change your energy and here where you begin to change your life.

Besides having an effect on your energy field, these possessions or conditions require your attention. They pull at you and your energy all the time. They can actually distract or prevent you from doing things that you love in life and from getting in touch with your true higher self. There are deep and real messages about yourself hidden in these piles or blockages of stuff. You must ask yourself why you feel like you need to own and hold on to so many things. Realize also, that in order to make changes happen in your life, you must provide an environment that invites change, clearing out the old in order to make room for the new.

You must be patient and kind with yourself as you begin to look at the baggage in your life. Some things will leave effortlessly, while others will pull at your heart and put your stomach in knots. Do not force anything. Donate some of your belongings and imagine those items being discovered by people who are thrilled to find them; send them out with a blessing that will enrich someone else's life. Start a non invasive internal cleanse mentally, spiritually, and physically as well. Slowly the process will become easier as you become accustomed to letting things go. Don't rush. Don't be careless. You will find that as you do this that your spirit will begin to feel lighter. You will also feel amazed that you suddenly have a knack for finding just the right item or eat just the right fuel or think just the right thought or connect with just the right energy frequency the next time you need something.

When you make room for a new life, new health, a new spirit, you create a current of energy that draws awesome-ness to you. Remember that the energy in your space and your own internal process are inseparable. By expressing your intention to improve the energy in your space, and by making a commitment of action to it, you are sending out an infinite wave of higher-level vibration that will positively alter your energy experiences and your abundance in life.

Until next month: Clear space, train smart. Live, race and recover smarter.

A passionate life and fitness coach, world-class athlete, author, and keynote speaker, Gary Kobat works one-on-one with select individuals, customized mastermind groups, and larger goal oriented teams for lasting personal and professional change. If you are interested in joining a group or for a private consultation, email him directly at: gary@e-coach.com.

Too High to Buy: INVESTMENT OUTLOOK.

by Kelley Wright, Managing Editor, Investment Quality Trends.

Kelley Wright, Managing Editor, Investment Quality Trends.

It has been said that most people's historical perspective begins with the day of their birth. Perhaps that is what George Santayana was alluding to when he said something to the effect that "those who are ignorant of the past are condemned to repeat it."If you haven't been paying attention, the U.S. dollar, our currency and the world's reserve currency (for the time being anyway), is dropping like a rock as the world diversifies into the Euro and a basket of Asian currencies.

This isn't the first time a world power has had their currency debased. Actually, every currency in history that wasn't backed by hard assets such as gold has gone the way of the dodo; hmm, what an appropriate analogy.

Since the mid 1990's America has benefited from the kindness of the Chinese as they have recycled the dollars we have poured into their coffers into purchases of Treasuries, which have kept interest rates low, and the great consuming machine powering ahead. What happens to the dollar and interest rates when this tidy little arrangement falls apart?

The big economic picture is completely missed when the markets start to focus on each release of data and every sentence by a member of the Fed is put under the microscope to find the nuance that will give the signal to move ahead or fall back.

The financial press is drooling at the prospect of the Dow topping the old high of 11,700. I know that is supposed to mean something but forgive me for missing the point. 11,700 is a price, which has nothing to do with value. Price to earnings ratios (P/E) fall to extreme levels and dividend yields rise to extreme levels in a bear market. Neither of these things happened from 2000 through March 2003. Never has a market gone from the extreme valuations seen at the end of 1999 beginning of 2000 just back to normal; bear markets always over adjust to the downside.

My point? Hold on to your hats folks because this one isn't over yet. Overvalued stocks should be liquidated and redeployed to Undervalued stocks. If there aren't any new Undervalued stocks to take positions in, then the yield on short-term Treasuries is one that shouldn't be ignored.

The Hulbert Financial Digest ranks IQ Trends the number one investment newsletter out of the 165 letters surveyed for risk-adjusted returns for the previous twenty years. Investment Quality Trends also qualified for the Total Return Ranking for twenty years. What is important to note is what separates IQ Trends from the other four letters in the top five; specifically the amount of risk required to generate returns. Two of the letters had about the same level of risk as the Wilshire 5000 index; one was almost twice the risk of the Wilshire 5000 and the other more than twice the risk of the Wilshire 5000. IQ Trends achieved its returns with about 24% less risk than the Wilshire 5000. Beyond the obvious that superior returns with less risk is desirable, less risk equates to less volatility and therefore generates higher compound rates of return over time. If you are interested in accessing Mr. Wright's newsletter, to post those kinds of gains yourself, go to www.IQTrends.com.

Please note: The opinions of writers contributing to NataliePace.com are their opinions, and not necessarily those of our staff and editors. NataliePace.com does not act or operate like a broker. We are a media and information center. This article is intended to educate and inform individual investors, and, thus, to give investors a competitive edge in their personal decision-making. The publicly traded companies mentioned in this article are not intended to be buy or sell recommendations. ALWAYS do your research and/or consult an experienced, reputable financial professional before buying or selling any security.

Sex & Money: You Are Sexy, Sassy and Smart.

SoÉ Should You Pick Up the Check?

by Natalie Pace.

Demi Moore and Ashton Kutcher, Fortunately, thanks to the hard work of the women who have come before us, American women are free, free, free to get an education and get pretty much any job we desire, so, thankfully, many of us can afford to pick up our own checks. But should you? Or should you politely excuse yourself to the powder room just before the check arrives, to allow him to make the choice? Should you discuss it beforehand? Should you take charge and just snatch the bill before he does? As if procreating the species and having a monthly period wasn't hard enough, now we have to figure out an entirely new mating dance! Who picks up the check?!! The question really isn't whether or not you should pick up the check. The question is: what kind of relationship are you interested in? Once you are in a relationship, you'll be giving your hot guy a say in a lot of things, but when you are just dating, your job is simple. You need to pick the right dream guy so your time together doesn't become a nightmare. Now, picking up the check (or not) sends a relationship signal to your date early on about the kind of relationship that you are interested in. So be sure that you are smart about the message you send, so that you are setting yourself up for the relationship you truly desire!

Are you more of a Demi, a Princess Di or a Hillary? Girls Who Pick Up. * Do you like treating your friends to a good time? * Are you so wealthy that the only guy who can pick up your check is Stavros Niarchos III? * Do you own your own Gulfstream jet? Let's face it. Britney Spears could have dated one of the Google founders, if she wanted to play Grace Kelly in the relationship. Whether it was a conscious choice or not, she picked a dancer to be her husband and the father of her son. Since the goal is to be sexy, sassy, smart and happy, make sure you make your choices before you start drinking! If you have more money than the Queen of England (like J.K. Rowling does), or have a dream job that you want to place first in the relationship, and/or are looking for someone to play a supportive role to you, then, by all means, reach for the check (with all of the femininity that you desire to summon) on ALL of your first dates. The challenge of a woman who rules the roost in a relationship is finding a great guy and not just a leech who is fawning all over you because he can't afford his own cover charge! Demi Moore didn't do so badly with Ashton!!

Girls Who Are Provided For. Princess Grace and Prince Rainier of Monaco, with their first two children, Princess Caroline and Prince Albert. American girls are doing pretty well in the Queen department. Grace Kelly, the Queen of Monaco and Princess Caroline's mother, was an American actress when Prince Rainier came calling. Queen Noor of Jordan, originally of California, was a Princeton graduate who dreamed of working in the Peace Corps when King Hussein asked her to marry him.

Queen Noor chairs the first meeting of KHF Board of Trustees, June 30, 1999. Queen Noor is now one of the most important voices for peace in the world, and, even more importantly, in the Middle East. She is Chairman of the Board of Trustees of the King Hussein Foundation, proving that playing a supportive role to a great man is not such a bad gig. (Note: a great partner is the key in all of these scenarios.)

Girls Who Want an Equal Partnership (and Pick Up the Check Sometimes) President Bill Clinton and First Lady Hilary Rodham Clinton At the 2004 Democratic National Convention Politics aside, you have to admire the strength of the Clinton's marriage and relationship. (It can be argued that Hillary picked a great, horny man. She's been quoted as saying, "It's hard to keep an old dog on the porch.") During his Presidency, Bill Clinton gave Hillary more power and influence than any other First Lady in history. She leveraged that into winning a seat in the Senate, and is now a leading Presidential contender for the next Democratic primary, with one of the most popular and powerful world leaders as her biggest cheerleader!

So, to pay or not to pay is an important choice! But, the most important decision you'll ever make isn't who pays, but picking a great partner. Brokers and Lovers: It pays to pick a good one, regardless of who buys lunch.

Take the NataliePace.com Online Survey: Should a woman pick up the check on a date? Go to the home page at NataliePace.com. Click on any survey, and you will be taken to the Survey page, where you can participate in all three online surveys, including our date protocol survey.

Water: the film.

There Are 33 Million Untouchables Living in India Today. One Noble Man Dared to Touch One. One Brave Woman Tells the Story.

by Maya Patel.

Don't miss one of the best movies of the year!

Water begins with an eight-year old girl, who is widowed. Widows are expected to spend the remainder of their existence in renunciation and atone for the past sins that resulted in the death of her husband. And that is the beginning of a twisted story, one that is still lived by millions of widows in India today.

A widow in the Indian Holy City of Varanasi left an indelible mark on director Deepa Mehta. Deepa describes this woman as "bent like a shrimp, scampering on all fours and head bowed in defeat." Ten years later, against extremist opposition and rioting, she shares the story of the outcast widows in an emotionally igniting film - Water. The film is a triumph, but so is the completion of the film. After violent protests by Hindu fundamentalists forced an end to production in India, a doggedly determined Mehta finally finished her masterpiece years later in Sri Lanka.

Don't think this is just your average boo-hoo chick flick, however. Mehta's masterpiece is a compelling drama, one of the most moving love stories ever written, and Water is being applauded by film critics as one of the best films of the year. It's hard to imagine anyone not being moved by this story.

The movie is set in 1938 Colonial India where child marriage was still prevalent. Marriages of young girls to older men were arranged by families for economic reasons. When the men died they left behind young widows that were farmed out to widow houses as they were considered financial burdens by their families. Most of the women were not literate. Water begins with an eight-year old girl who is widowed and sent to a house where she is the youngest member.

The realities of tradition and human nature are unveiled through the day-to-day lives of the widows. Tradition has cast hardship on the widows. They are separated from society not only by their physical residence, but also based on outward appearance. They have shaved heads and are wrapped in white linen as they must renounce all worldly possessions. The restraint required to do this has profound physical effects on these women. Most of the widows blindly follow tradition, as does the surrounding society. Widows are considered polluted; as a result they are treated like pariahs.

These women are stalwart. They lead lives devoid of material pleasure and are considered outcasts by society. They rely on tradition and religion to derive strength. However, when it is necessary, they break tradition and morals to sacrifice one of their own to the greater good of all. That is where the seed of all the mayhem of the film lies - in one lovely young woman who is allowed forbidden pleasures, which include having long, flowing hair and even nightly boat rides across the waterÉ

Deepa Mehta captures the essence of human nature as she shows the interaction between the widows and the world outside the walls of the widow house. These interactions may seem like trivial points, until you realize the emotional pull each carries. It evokes emotions in the audience because you see how each negative interaction erodes the character of these widows.

The movie is not completely dismal. Despair is juxtaposed against hope. There is a Ghandian idealist who is symbolic of change. There is also one widow, who casts aside tradition to save a life, after struggling with issues of tradition versus modernity.

Due to the historical context of the movie, it would be easy to assume that this was history. Unfortunately, there are still 33 million widows in India, and many in the rural areas, where tradition is still sacred, are outcasts. This movie is eye opening not only for garnering attention to the plight of the widows, but also for tackling the social construct that perpetuates these issues.

It is the director's hope that "people who see [Water] will feel compassion for their fellow beings, even though they might be totally unfamiliar with the characters' interior and exterior landscape."

If you would like to take action please visit the Water website:

Water
Playing in Manhattan at the Paris Theatre and Angelika Film Center and in Southern California at the Laemmle Theaters

Written (in Hindi, with English subtitles) and directed by Deepa Mehta; director of photography, Giles Nuttgens; edited by Colin Monie; music by Mychael Danna, with songs by A. R. Rahman, lyrics by Sukhwinder Singh; production designer, Dilip Mehta; produced by David Hamilton; released by Fox Searchlight Pictures. Running time: 114 minutes.

WITH: Seema Biswas (Shakuntula), Lisa Ray (Kalyani), John Abraham (Narayan) and Sarala (Chuyia).

You Know Zillionaires By Their Smiles.

by Chellie Campbell, author of Zero to Zillionaire.

Chellie Campbell, author of Zero to Zillionaire

I wear gold tennis shoes. Always. I have gold leather tennis shoes for regular wear, gold mesh tennis shoes with rhinestones for speaking engagements, and gold-beaded tennis shoes for black tie affairs. All gold tennis shoes, all the time.

At first, I only wore them for fun. Then one year I gave up high heels for Lent and I haven't had them on my feet since. I decided that being comfortable and cute in my own wayÑnot in the fashion industry wayÑmakes me a Zillionaire. I am always comfortable and my feet never hurt. That makes me happy, and happiness is a Zillionaire trait. You will know Zillionaires by their smiles.

What do you really want? Not what you think you should want, or what your parents said you should want, or what your spouse, partner, friend, magazines or television says would be a great thing to want. Zillionaires are aware of the inner core values that are important to them, and their outer lives reflect them. Inner core value: comfort. Outer reflection: gold tennies.

But what if you don't know what you want? At one point in Alice in Wonderland, Alice was walking through the woods when suddenly the path she was walking on diverged in two different directions. Confused, she stopped, not knowing which path to take.

At that moment, the Cheshire Cat appeared in the tree next to her. She asked him which way she should go. "Where are you going?" he inquired.

"I don't know," she replied.

"Then it doesn't matter which path you take, does it?" said the Cat, and disappeared.

If you don't know where you're going, any path will take you there. Tell me what you want and I can help you locate the right port, help you navigate your ship into that port, and the Universe will kick in the right breeze to lift your sails. But no one knows how to help you get to "I don't know."

Pick a goal. Any goal. Your best guess for today will do. Don't wait for the right goal or the perfect goal. It may be around the bend in the road and you can't see it from where you stand today. Pick an interim goal that will get you in action, give you experience in achieving goals, and one day you'll find yourself around that bend where your "perfect goal" is within reach after all.

Here are some questions to guide you: How much money do you want to make? What job do you want to do that pays that kind of money? Think about what your talents and skills are, and what you most enjoy doing. Who are the people who need what you have and would pay you for it? Decide whether you want to work for someone else or own your own business; whether you want to work as part of a team, or alone as a sole practitioner.

If your fondest desire is to own your own business, how big would you like it to be? Do you want to serve many customers or just a few? Choose whether you want to be a hair stylist or own a chain of beauty salons. Choose whether you want to be a personal trainer or own a gym. Or a chain of gyms. If you want to manufacture a product, choose how many. Do you want to lovingly handcraft fine cabinets yourself, or do you want to mass-market furniture? Do you want to be a sole practitioner accountant or develop a giant multi-national firm like the Big Four? Do you want a job, a career, a profession, or a calling? What moves you, motivates you, inspires you? What gets you up in the morning with a smile and an "I can hardly wait"?

Children are masters of "I can hardly waits." They are laser-focused when they decide they want something. They want it all and they want it now. And they "can hardly wait" until the day when they get it.

When my nephew, Robert, was four years old, both of his older sisters were on T-ball teams. They had bright, crisp uniforms and practiced every week. When game day came, the whole family sat in the bleachers and cheered them on. More than anything else, Robert wanted to play T-ball.

But there were no T-ball teams for four-year-olds. The minimum age was five. Mama Jane patiently explained this to him every time he watched his sisters play. "Okay, I'm going to play T-ball, too," Robert said. "Just as soon as I'm five. I can hardly wait!"

Then one warm spring afternoon, Jane, Robert, the two girls and their dad went to the neighborhood park. There were several families there already, and they had started a pick-up game of T-ball. Laughing, the girls and their parents ran out on the field to join in the fun. But Robert stayed behind.

Jane turned around and saw Robert on the sidelines looking dejected.

"Come on, Robert," she called, "You can play with us today!"

"No, I can't," said Robert.

"Yes, you can!" Jane exclaimed. "Today you can play."

"I can?" Robert asked, wide-eyed with excitement. "Am I five?"

Today, let's all be five. Let's play T-ball, or basketball, or tennis, or poker, or Wheel of Fortune. Let's join a group and play a game for all we're worth. Play the Game of Life for all we're worth. It's the only game in town, and the only way to lose is not to play, crying "I don't know what I want."

CHAT WITH CHELLIE THIS MONTH
Learn more about how to develop that lust for life that bursts on the faces of so many accomplished entrepreneurs. Chat one-on-one with Zero to Zillionaire author Chellie Campbell on Wednesday, June 14th at 8:45 a.m. PT (11:45 a.m. ET) about how to transform your dream business into a dream come true. Learn how to make the personal changes and personal choices (from affirmations and visualizations to choosing great partners and staff) that will allow wealth to be attracted to you. (Subscribers only. You can register for 90 days free now on the NataliePace.com home page.)

Chellie has helped thousands of entrepreneurs increase their net income and personal wealth and her no-nonsense, easy to implement strategies start working from the day that you using them.

Corporate Goddesses Honored at the Forbes Executive Women's Forum.

by Jane C. Rosen.

On May 8^th I had the honor of presenting my new book, My Life as a Corporate Goddess to 160 beautiful Corporate Goddesses at the Forbes Executive Women's Forum. Under the theme of Leading to Change, Forbes created a forum for serious women to discuss serious issues amidst the hugs and laughter of gal-pal camaraderie.

It was the perfect "coming out party" for the book. Not only was it the right audience, but also two of the women featured in its pages were speakers. Both Janet Hanson, founder of 85 Broads and Managing Director at Lehman Brothers, and Connie Duckworth, past Chair of Committee of 200, President and Chairman of the Board of Arzu, Inc. and retired Partner and Managing Director of Goldman, Sachs, & Co. graced panel discussions with other outstanding women.

Kendall Crolius of Forbes introduced me, and I read excerpts from several chapters, which were greeted with much laughter and applause. I described the Corporate Goddess, power ties vs. the power of heels from my chapter "White Guys in Ties," and a little taste of "Corporate Goddess with Children." This last excerpt begins with a quote from Gloria Steinem, who was being honored with the Forbes Trailblazer award that evening. So, not only did I get to be the warm-up act for Ms. Steinem, but I had a chance to talk with her after she received her award and inspired us with her eloquent speech.

As I handed her a copy of my book she said, "I understand you quoted me today." And I replied, "Of course I quoted you." After all, she is the voice for women leaders who dare to follow their dreams.

The following day was delightful. A number of women came by to tell me that they had begun reading my book and they thought it was hysterical and informative. My favorite comment was a woman from Texas who said, "Girl, you are a hoot!"

I wrote My Life as a Corporate Goddess for these women, to bring humor to the serious work they do, and they graciously received my gift with open arms. I couldn't ask for more.

You can purchase My Life as a Corporate Goddess by going to the website, www.mylifeasacorporategoddess.com. Just click "buy the book" which takes you to the publishers secure on-line bookstore.

Shorts and Bikinis.

8 Easy Beauty Treatments for Smart Investors.

by Natalie Pace.

Are You Bikini Fit For Summer? Would You Be Ashamed If Someone Saw Your Nest Egg Naked? Have you even looked at your portfolio lately? Ignoring it is silly. You might be in better shape than you realize, and if you aren't, read on for 8 Easy Tips to make your money house more attractive now!

The mid-May sell-off in the stock markets, where 5-8% of the gains since January were taken back, is a wake-up call that it is summer, and we are headed into the seasonal time of lackluster returns (often referred to as the summer doldrums), as we inch toward the historically worst performing month of the year (September) and the spookiest month (October). October has seen Black Monday 1987 and Black Thursday 1929, two of the most dreaded days in stock market history.

So, what's an investor to do? Panic? Heed calls of doomsday and horror? Before you build the ark, note that real gross domestic product increased in the first quarter of 2006 at a VERY healthy 5.3%, compared to just 1.7% in the fourth quarter of 2005. According to the Bureau of Economic Analysis press release on 5.29.06, "Positive contributions from personal consumption expenditures (PCE), exports, equipment and software, and federal government spending" account for the increase. Exports netted out higher than imports, increasing 14.7 percent over 12.8 percent, respectively in the first quarter. Needless to say reversing the trade imbalance is a trend worth noting and continuing, and, based on the strength of the first quarter numbers, it's not surprising that the mid-month sell-off is reversing itself.

But that kind of drop in the markets sure shakes a person out of complacency. And yes, if it can happen once, it can happen again, and the drop can be quick and painful, like it was in October of 1987, or it can be slow and miserable, like it was from the steady losses incurred from the NASDAQ highs of March 2000 to the suicidal lows of October in 2002. Just like the Caribbean Islands, you've got a lot great days to enjoy bikini weather in the markets, which earned double the returns of real estate over the past 25 years, but you've got to be prepared to weather the storm of the occasional hurricane!

You wouldn't toss all of your belongings into the path of the hurricane, and you shouldn't be dumping all of your stocks in every downturn. It's a sure way to lose.

Just like you do when you're trying to slim down for that bikini, you want to trim any excess fat out of your portfolio NOW, reinforce the foundation of your portfolio and make sure that you're not drinking too much of the punch on hot stocks or the Dow hitting its high of 11,700. How do you beautify your 401 (k)? I've outlined 8 tips below.

1. Invest in knowledge. Start educating yourself now. Be sure to take the Investor Quiz in this month's NataliePace.com ezine, to see how well informed you really are. Look over all the links in the Investor Edu section. Always read the last article by me in each NataliePace.com ezine, where I write the latest news on a number of selected stocks that we follow.
   
   
2. Cash is King. Make sure that a percentage that is equal to your age is completely SAFE, and you might consider adding more than that, to ensure that you can buy in the event of a downturn. Safe means that it is NOT invested in stocks or real estate (both of which can go down. See below for stats). CDs, money markets and T-Bills are virtually risk free and are currently producing bond-like returns. If the investment is backed by the FDIC or by the U.S. government (like government issued bonds), that is about as secure as you can get.
   
   
3. Don't bet the farm. Invest according to your risk tolerance. If you want to try for a higher return, take a small percentage (for the timid, pros suggest not more than 5%) of your nest egg to try your hand on selecting individual stocks. The risk here increases GREATLY, but so does the reward and return. If you choose to invest on your own, find a stock guru with excellent returns to use as your mentor. The price of a great newsletter is well worth it. (And NataliePace.com has one of the best reputations for featuring great companies at an opportune buying time.)
   
   
4. Live. Love. Invest? YES!! Put your money where your heart is. You are more likely to make money on something that you understand and adore than on something that you have no clue about and/or abhor! While you are enRICHing your wallet, you are also enRICHing the world and are more happy and less stressed out with the things that you are supporting. Win/Win/Win.
   
   
5. Are Mutual Funds Obsolete? The Exchange Traded Funds are currently traded on the AMEX Composite, which has seen 120% gains since January 2000, compared to a flat Dow Jones Industrial Average, -12% in the S&P 500 and -42% in the NASDAQ. Mutual funds cost more than index funds or ETFs in fees (though this is not obvious, except in the fine print). Even if the fund has a great reputation for yielding returns, the markets are heading out of mutual funds and over to ETFs, which means that you might suffer from investor exodus, even if the mutual fund manager is exceptionally talented. Also, most mutual funds have holdings that people wouldn't be caught dead supporting, like Altria, which is the new, improved name of the Phillip Morris tobacco company (which also owns Kraft Foods). FYI: For those of you thinking to just go long on the AMEX Composite Index, it is being reported that Barclays is moving its ETF portfolio over to the New York Stock Exchange. We'll report more on this as it develops.
   
   
6. ETFs and Index Funds. A good way to diversify if you're new to the game. The online discount brokerages have a lot of tools to help you determine the ETF that is right for you.
   
   
7. Stocks Outperform Real Estate: The S&P 500 has rewarded investors 10.5% annually over the past 37 years, with small cap stocks ringing up 12.5% returns (source: Ibbotson Associates, a Morningstar company). The National Association of Realtors reports that the median price of existing single-family homes in the US increased only 6.7% annually over the same period. Gold weighed in slightly ahead of real estate, at 7%. (Refer to the chart above.) Do the math. Newspaper headlines are always based on sensationalism. Stocks were sensational in 1999-2000. You could have thrown a dart at a wall and come up with a winner. Real estate has been a rocket over the last five years, and still the returns over a longer period of time are about half that of stocks. You want to own a home for many reasons. You don't want to own a money pit, and you certainly don't want to buy high right now just because it is de rigueur.
   
   
8. The Blue Chips or AMEX? There is a big difference between the way that the different indices behave, and though everyone was riding the Dow near its all-time high in early May, by mid-May it was clear that running with the bulls can be a goring and galling proposition, if you don't jump out of the way in time. In 2000-2002, it was NASDAQ that suffered the strongest correction (losing up to 70%) while the Dow Jones Industrial Average was much more resilient (shaving off a mere 30% at the October low), but this time the story may be reversed. In 2006, the Internet is earning profits and the legacy corporations of the mature Dow Jones Industrial Average are carrying around more debt and pension responsibilities than the average investor may be aware of. Don't try to get too fancy, but do educate yourself and make sure that your blue chips are healthy and your microchip stocks are sound.

More Info on Select Indices:
With the Dow Jones Industrial Average hovering near its six-year high, there are certainly more blue chips to sell than there are to buy. On the other hand, the Amex Composite Index, which has shot up 120% since January 2000, and ETFs (which are concentrated in the AMEX Composite) are still gaining in popularity. Joining the movement of investors that are transferring from mutual funds into ETFs might be a good call, and is an option you should consider. In addition to the momentum move from mutual funds into index and exchange-traded funds, you are also benefiting from lower management costs and brokerage fees.

For those of you who are thinking to just go long on the Amex Composite Index, note that past performance is no guarantee of future gains! The ETFs may be moving to the NYSE (as noted above).

More Info on ETFs
If you want to invest in ETFs on your own, online discount brokerages make it easy to gather important asset allocation and diversification information and to invest. If your nest egg is managed, your certified financial advisor should be able to direct you. If your broker is discouraging you from making the move from mutual funds to ETFs, find out how much s/he receives in commissions from the mutual funds s/he is selling you, in addition to asking other pertinent questions about why the mutual fund is a better choice and which stocks are held in the fund. At the end of the day, it is your portfolio and your decision. Believe it or not, in investing, the best choice is often the one you believe is the best choice because most money is lost when investors panic and sell low to end the agony, not when on investments go belly-up. If you believe you've made a reasonable choice, you are more apt to believe that those investments will recover from a downturn and operate with a level head.

Coach Yourself to Success by Joe Moglia, the CEO of TD Ameritrade, is one of the best investing 101 game plans I've read for those who are new to the terms ETF, mutual fund, bond, T-bill, etc. You can buy it by clicking over to Amazon through the link.

More Info on Risk Tolerance
As Daniel Kahneman, Nobel Laureate in Economics, explained last month at the Milken Global Economic Conference, "The intensity of people's reaction to losses is twice as much as their reaction to gains." Since most people have such an accelerated emotional reaction to losses, the professional who makes you feel safe, and provides you the long shot, is the broker/certified financial planner who is designing and implementing a plan that has a greater likelihood of working. Properly allocating and protecting the bulk of your portfolio, while taking a small percentage for potentially greater gain could be that magic formula of making you feel safe, while at the same time providing you with the potential for great gain. As Kahneman puts it, you want to inoculate yourself so that "when the inevitable occurs, downturns, [you] do not sell low."

Bikini Fit and Trim
To make sure that you are fiscally fit and beautiful this summer, take a look at the curves in your portfolio. Because there is a lot of risk in the markets (high valuation in the Dow, terrorism, rising interest rates, inflation, stronger yields in bonds, moderated GDP growth projections), you should make sure that you have your assets allocated properly NOW. You don't want to have all your clothes on the clothesline during a hurricane, and you don't want your entire portfolio banking on clear skies in the stock market or on real estate. All asset classes have their highs and their pullbacks, including today's darling, real estate. Usually when one is tanking, the other is soaring. The key is patience, pruning, information, a good fundamental plan and the wonderful adage: buy low, sell high.

Any certified financial planner worth his/her snuff should be able to gauge your risk tolerance and help you achieve your long-term goals by spreading out your assets among various types of investments. Some discount brokerages do a great job of outlining asset allocation strategies for do-it-yourselfers.

So, what to do with your stocks, real estate and bonds during the summer doldrums? Just make sure you lighten up on your exposure and that your money is working for you, while you jump into that bikini and enjoy the warm waves. If you've developed a solid, long-term plan, you'll be in far better spirits to enjoy your well-deserved vacation!

How to be a Better Investor?

Experts say start by suspending your emotions.

by David R. Fried, Editor, The Buyback Letter and Buyback Premium Portfolio

David R. Fried, Editor and Publisher, The Buyback Letter

Many longtime subscribers will have heard me talk before about how I believe emotions often trip up many investors and prevent them from achieving their wealth-building goals.

Basically, most of us are a mess when it comes to managing our emotions as they relate to our investments. We procrastinate. We buy what is popular (cocktail party chatter stocks). We watch too much CNBC and sway in the wind each time another pundit speaks. We are so overloaded with facts that we suffer from analysis paralysis. We listen to bad advice. We ignore our own guidelines for investing, and we fear losses and think we can outguess the market.

Yikes! It's a wonder any of us ever make any money.

Well, now science actually backs me up that emotions are an investor's worst enemy.

Let me tell you about a fascinating scientific experiment that sheds light on how we all would be better off if we could switch off our own emotions, or at least ignore them when we sense them rearing up. (I'll try to explain the scientific experiment as simply as possible while avoiding medical jargon. Sources are listed at the bottom of this column.*)

Researchers set up a game that would mimic real-life investment decisions in all their uncertainty, reward and punishment. In it, three groups of people were each given $20 in $1 bills. They were asked to make successive rounds of investment decisions and in each round they had to decide whether to invest $1 or not invest. If they didn't invest, they kept the $1; if they did invest, they gave the $1 to the investigator, who would toss a coin. If heads - a 50% chance - the person would lose the $1; if tails, then $2.50 would be added to the participant's account. And so on, round by round.

The game was set up such that it would behoove participants to invest in all the rounds because the expected value on each round is higher if one invests ($1.50) than if one doesn't ($1). Stated another way, if you lost, the penalty was $1. If you won, the prize was $1.50. So if you didn't play, you still had $20. If you played every round, you would end up with $25 (assuming an equal number of heads and tails). You don't even have to be a savvy investor to figure out what makes sense.

The composition of the three test groups was evenly matched, except for one key element - the emotional component. The mean age of participants was 51-53 years in all the groups, they had about 14 years of education on average, and all had normal IQ and intellect. The first group was called a "normal" group, much like you and I. They volunteered for the experiment after being recruited through a local newspaper advertisement. The second group was the "target" group, which had an injury in the brain region related to emotion; simply put, they cannot process emotions properly. The third group was called the "control" group, and had an injury in the brain not related to processing emotion (perhaps due to stroke or illness). The participants in both the control and target groups (those with brain injuries), were all drawn from a patient registry at the University of Iowa and their injuries were stable and well understood. They were all able to consent to be a part of the research.

How did they do? When confronted with a few times the coin came up tails, the normal and control patients (those whose emotions were intact) were likely to stop playing rather than stay in the game and let the odds work in their favor. They retreated to a conservative strategy, suggesting they were more affected by the outcomes of decisions they had made in previous rounds. You might say these people projected past results into the future, and thus they locked in their losses.

The target group - those players whose emotional circuitry was haywire - made better, more efficient, more advantageous decisions and earned more money from their investments than the normal and control players. Their behavior was more rational because it properly accounted for likely future returns; they didn't factor in fear or anxiety. In other words, their weaker emotional function allowed them to be more rational investors.

OK, so what do we do with this interesting information?

Since most of us aren't suffering from a brain injury that divorces our emotions, let's delve deeper into what made the normal and control groups less successful investors in this game so we might learn from their mistakes.

As background, understand that there is a condition known as "myopic loss aversion" that apparently was at play here. Researchers who discovered that found that even relatively mild negative emotions can play a counterproductive role in making investment decisions. They explain it this way, using gambling terms: For example, when a gamble that involves some possible loss is presented, most people display extreme levels of risk aversion toward the gamble. The example given is that most people will not voluntarily accept a 50-50 chance to gain $200 or lose $150, despite the gamble's high-expected return. This same explanation - myopic loss aversion - has been suggested as an explanation for why many people prefer to invest in bonds, even though stocks have historically earned a much higher rate of return.

The experiment about emotions in investing explains why, since myopic loss aversion has an emotional basis, a problem or dysfunction in the emotional system can lead to better investment decisions. The elimination of emotion in cases in which risk-taking is rewarded, such as the stock market, is a great advantage.

All three groups in the study started out the same, but only the target group (emotionally disconnected) kept investing. The normal and control groups (whose emotions were intact), became more conservative, investing in fewer rounds as the game progressed, in spite of the odds being in their favor. Their decisions were affected by the outcome on preceding rounds. In fact, both the normal and control groups were more likely to withdraw whether they lost on the previous round or they won. This differed greatly from the target players, who invested equally often whether they won or lost.

Our take-home message from delving into the scientific literature that backs up our beliefs is this:

• First, pat yourself on the back for staying in the stock market, because you've overcome the initial hurdle.
• Second, congratulate yourself for remaining disciplined in your approach. The markets have been volatile lately, and it's no exaggeration to say it has been a tough investing year. In fact, at its best all year, the market has only been up a few percent. As I write this, stocks have tumbled, the Dow, S&P 500 and NASDAQ have all been very volatile recently - rallying and then falling 5-8% in just a few days.
• Third, understand that while researchers may use gambling analogies to explain myopic loss aversion, we are not gamblers. We believe that a disciplined, measured, researched and reasoned approach to investing in the stock market is the best and most prudent way to prepare for the future.

Now, after you are done congratulating yourself for hanging tough in a tough year, then rip a page from the playbook of the emotion-challenged target group in this study. Remember that they made better, more profit-maximizing decisions. Accept that you're human and your emotions are likely to get in your way while you invest, whether in difficult times like these, or in boom times. So especially this year, we must keep reminding ourselves to keep a level head in the midst of market turmoil.

Investing is one of those circumstances in which a naturally occurring emotional response needs to be tamped down and controlled to make way for a more deliberate and wiser decision. The researchers call this negative emotional effect the "dark side" of emotions - when moods and emotions can play a disruptive role in decision-making.

For the most effective and successful investing, control your emotions; do not let them control you, or you'll end up on the losing side of the equation.

Whatever you do, avoid the dark side. And may the Force be with you.

*The research, "Investment Behavior and the Negative Side of Emotion," was published in the June 2005 issue of Psychological Science, authored by Baba Shiva, an associate professor of marketing in the Graduate School of Business at Stanford University. He studies the role of emotion in decision-making, the neuro-physiological bases of emotions, and non-conscious mental processes.

David  Fried is the editor and publisher of The Buyback Letter, the only investment  newsletter devoted to finding opportunities among companies that repurchase  their own stock. His asset management firm - Fried Asset Management, Inc. -  offers separate investor advisory and money management services which use the  "Buyback Strategy" principles. Fried  Asset Management's managed accounts have gained 146.98% vs. a 28.67% gain for  the S&P 500 for the 8-years ending 12/31/05*.  All of his NEWSLETTER portfolios are beating the  S&P 500 since inception, and the prestigious Hulbert Financial Digest  consistently ranks The Buyback Letter among the top five for risk-adjusted  returns among stock-picking newsletters.

Answers to the INVESTOR QUIZ.

Are you a Bull, a Bear, an Owl or a Dodo When It Comes to Investing. Take our quiz and find out!

Points: Give yourself an Owl point for the right answer. Give yourself a Dodo point for the wrong answer. Assign Additional points for bull or bear as outlined beneath each answer.

1. Asset Allocation.
   - For "Cash is king," give yourself a bear point.
   - For "Equity diversification" give yourself a bull point.
   
   
2. Stocks
   The stock market has rewarded investors 12.3% annually over the past 25 years (source: Hulbert's Financial Digest), posting higher gains on average than real estate or bonds. The National Association of Realtors reports that the median price of existing single-family homes in the US increased 5.18% annually over the same period. That means stocks paid two to one over real estate. In 1980, 25 years ago, gold was peaking at over $800 per ounce, which means that gold, trading at $650.90 on 5.30.06, has lost value over the last 25 years. Bonds have returned 5.3 - 5.9% over the last 80 years.

   

   - For "Bonds, real estate and gold," give yourself a bear point.
   - For "Stocks" give yourself a bull point.

3. One Year Before the Presidential Election (which gives the incumbent party a stronger economic platform on which to run)
   
   
4. Yahoo.com
   
   

   Top Internet Media Companies	Total Unique Visitors (000)	Total Pages Viewed (MM)	Average Minutes per Visitor
   	Jan-06	Jan-06	Jan-06
   Total Internet : Total Audience	170,797	447,296	1,558.2
   YAHOO.COM	122,188	33,368	216.5
   GOOGLE.COM	91,092	7,237	32.2
   MSN.COM	90,965	15,791	177.9
   AOL.COM	73,657	7,439	60.4
   MYSPACE.COM	35,579	23,125	145.2

   Source: comScore Media Metrix

   - For "Google" and "MySpace" give yourself a bull point.

5. Citigroup.

   Market Caps (5.19.06):
   Citigroup: 246.4 Bil
   Microsoft: 242 Bil
   Cisco: 128.4 Bil
   Berkshire Hathaway: 116.1 Bil (Class A) + 29.53 Bil (Class B)
   Altria Group (Philip Morris): 148.3 Bil
   
   - For Berkshire Hathaway, give yourself a bear point.
   - For Cisco, give yourself a bull point.

6. Altria
   - For Berkshire Hathaway, give yourself a bear point.
   - For Cisco, give yourself a bull point.
   
   
7. Cigarettes.
   - For any wrong answer, give yourself a bull point.
   
   
8. AMEX Composite Index

source: Money Central

- For S&P 500 & DJIA, give yourself a bear point.
- For NASDAQ, give yourself a bull point.

9. Utilities
   Industry group scorecard for 1Q 2006 that measures price change only and does not include dividends:
   
   

   	Symbol	12/30/05	03/31/06	% Change
   Dow Industrials	DJIA	10,717.50	11,109.32	3.66%
   Nasdaq Composite	COMP	2,205.30	2,339.80	6.10%
   S&P 500 Index	SPX	1,248.29	1,294.83	3.73%
   Alternative Energy	ECO	172.97	227.14	31.32%
   Energy	IXE	504.21	545.56	8.20%
   Transportation	TRAN	2,438.10	2,625.20	7.67%
   Capital Goods	IXI	315.17	338.73	7.48%
   Basic Industries	IXB	312.05	333.65	6.92%
   Commercial Services	.SICSS	183.95	194.63	5.81%
   Technology	IXT	211.16	222.96	5.59%
   Biotech	BTK	680.91	712.97	4.71%
   Health Care	DRG	319.99	329.31	2.91%
   Consumer Services	IXY	327.54	336.35	2.69%
   Financials	IXM	316.06	324.25	2.59%
   Consumer Staples	IXR	233.16	236.18	1.30%
   Utilities	IXU	318.97	312.44	-2.05%

   Source: Thomson One Financial

   - For Consumer Staples, transportation, basic industries and capital goods, give yourself a bull point.
   - For biotech, tech, alternative energy, energy and financials give yourself a bear point.

10. Amex Composite
    - For S&P 500 & DJIA, give yourself a bear point.
    - For NASDAQ, give yourself a bull point.

    In addition, here's the equity market segment scorecard for the first quarter of 2006.

    	Symbol	12/30/05	03/31/06	% Change
    REITs	VNQ	59.56	67.92	14.04%
    Small Cap. Value	IJS	63.88	72.59	13.63%
    Microcap	IWC	51.15	58.10	13.59%
    Small Cap.	IJR	57.80	65.00	12.46%
    Small Cap. Growth	IJT	116.07	128.70	10.88%
    MidCap Value	IJJ	70.49	76.69	8.80%
    MidCap	IJH	73.80	79.23	7.36%
    MidCap Growth	IJK	75.62	80.49	6.44%
    Large Cap. Value	IVE	65.05	68.85	5.84%
    Large Cap.	IVV	124.67	130.13	4.38%
    Large Cap. Growth	IVW	59.28	61.09	3.05%

    Source: Thompson One Financial

Now do the math! Are you a wise old owl or do you need to learn more about investing? Do you play it safe or are you anticipating great gains? By understanding your tendencies and separating truth from fiction, you can start up the golden brick road to wisdom, where even more riches await.

Tune in next month for a real estate investor quiz, designed by the prosÉ

National Savings Crisis or Media-Generated Hysteria?

Either Way, It's Time to Start Saving for a Rainy Day.

by Natalie Pace.

8 Tips for Sailing Through Rising Interest Rates, Inflation and Other Storms on the Horizon. Including our monthly Hot News on Cool Stocks Report.

21 BIG WINNERS, even given the mid-May sell off!, which keeps the companies featured in NataliePace.com at the top in Annualized Returns (according to TipsTraders.com).

Natalie Pace, NataliePace.com CEO and founder

This is a reprint of the NataliePace.com mid-May report (which is available online to subscribers) with some important updates and additions. There are new stats and info in the Hot News charts below, a very interesting new section on Companies in the News and a new online chat opportunity for entrepreneurs (which is free to NataliePace.com subscribers).

Last month, the media picked up on an old story, the fact that Americans are not depositing money into savings accounts, and hyped it as the new crisis (alongside bird flu and nuclear weapons in Iran), so naturally, NataliePace.com got a few hysterical calls and emails. The personal savings rate has been a negative number since last fall (when NataliePace.com first reported on the trend), hovering at a negative 0.3 percent in March 2006, but recently the media decided to represent that as proof that America is doomed to drown in its own debts. With nobody saving and inflation and interest rates on the rise, is the U.S. economy heating up for a major economic meltdown? Is it time to run for the hills and hide your cash under a mattress?

As in most crises, the voice of reason is hard to hear above the din of fear, so I'm going to do the equivalent of yelling for at least a few sentences to catch your attention. Over the last few years, when interest rates were at 40 year lows, AMERICANS WERE NOT STUPID ENOUGH TO DEPOSIT MONEY INTO A SAVINGS ACCOUNT THAT WAS PAYING 2% OR LESS, but that doesn't mean that they don't have money socked away elsewhere. In fact, the nation's homeownership rate in 2005 was a record-breaking 69%, with most Americans benefiting from a healthy home price appreciation (source: National Association of Realtors).

Home equity is not included in the savings rate, and neither are retirement plans, both of which are where the bulk of Americans assets are being housed today. Additionally, in April 2006, unemployment was down to 4.7%, which means that any American who wants to have a job probably is working. GDP is still growing. Real GDP increased at an annual rate of 4.8 percent in the first quarter of 2006, according to advance estimates provided by the Bureau of Economic Activity, and labor productivity is still at an all-time high. So, the savings crisis is just another fairy tale, a manipulation of the facts to keep you glued to your television or amped up to vote for this or that politician, alongside other hysteria-inducing headlines including how immigration and outsourcing are stealing American jobs. (Having less than 5% unemployment is generally considered as having a nation fully employed.) Meanwhile, serious bipartisan concerns, like the pension care crisis in the U.S., are still flying under the radar of most reporters. (Tune into the June NataliePace.com ezine for a major report on the pension plan crisis in the U.S., in our report from the 2006 Milken Global Economic Conference.)

While it is true that interest rates, national debt AND inflation are on the rise and that the U.S. Pension Guaranty Benefit Plan is sliding deeper into the red abyss, home owners in particular and most Americans in general do have more assets than a negative savings number would indicate, and the future is not doomed, provided there isn't a panic run for gold, a run on the banks, a rush of all U.S. intelligent life to Estonia or a fallout in American productivity. Smart Americans, who now have control over their investments, their work, their commute and their retirement plans, can make a few changes to their life style, can continue to work hard and are then in a great position to find solutions to the challenges that lie before us. After all, we still have great universities, attract the brightest talent on the globe and lead the world in innovations. If we can put a man on the moon, surely we can figure out how to power our lives by sunlight, wind and other renewable resources, and high oil prices mean that talented individuals are given the dough to solve the problems. (Note the run-up in market capitalization of just about ANY alternative energy company.)

Fear cycles into chaos; confidence creates miracles. How do smart people benefit from your hysteria? They do know the facts behind the headlines, and prepare for the coming trends, instead of dropping their head into the sand and getting whipped around by sandstorms. Preparedness means that when others panic or hide or sell low, you are in a position to profit.

So, how do you prepare to profit and flourish during a period of rising interest rates and inflation (instead of spinning out of control and selling all of your hard-earned gains low)?

1. Preserve your nest egg. Meet with a trusted certified financial planner now. With the Dow Jones Industrial Average and real estate near all-time highs, it is time to diversify. Consider taking some profits off the table. As Sally Krawcheck, the CFO of Citigroup, says, "What your financial services provider should be doing is not to get you in and out of segments of the market on a rapid-fire basis, but to give you a diversified portfolio. When the stock market goes up, you take some profits out. When fixed income goes up, tilt it that way." There is some tilting right now with real estate and the DJIA riding at all time highs. To review some more words of wisdom from Ms. Krawcheck, check out Citigroup Wows L.A. Women.
   
   
2. Save for a Rainy Day: Money markets and CDs are earning bond-like returns with very low risk (no risk if they are FDIC-insured). Liquidity means your money is protected AND available for buying opportunities, in the event of a downturn in stocks or real estate. Additionally, liquid assets may become necessary in a period of rising interest rates and inflation. Investors who bought NASDAQ on October 2001, after 9.11, saw 40% gains in just three months, by January 2002. Investors who bought at the October 2002 low, are today enjoying 90% gains in NASDAQ, 140% gains in the AMEX Composite, 40% gains in the Dow Jones Industrial Average and 50% gains in the S&P 500. You can have your index funds or basket of diversified individual stocks pre-selected so that you (or your broker) are ready to buy in the event of a shock in the markets. Be patient.
   
   
3. Reduce costs now to offset the rising monthly costs of inflation and interest rates. High oil, gas and energy are hard on your wallet, but good for our world because they provide a big incentive to our universities and scholars to find a better solution to being oil-dependent. As a consumer, you need to find ways now to become more gas efficient, more energy efficient and to live with renewable energy products. Find a way to carpool, work from home, reduce your commute, use solar energy to heat your water, etc. Check out the June issue of NataliePace.com for tips on how.
   
   
4. Increase your income now. It is a tight labor market, which is a great time to ask for that raise or to check out opportunities for a promotion. If you think you're ready for more responsibility, more hours or anything that will put more money in your pocket, go for it!
   
   
5. Lock in a fixed home loan at the lowest possible interest rate. Shop around.
   
   
6. Pay off your credit card debt and/or find a low, fixed rate that is guaranteed for a sustained period of time until you can pay off the debt. Credit card companies are going hog wild with interest rates these days, and if interest rates continue to rise, the companies will only get more aggressive. Penalties and high interest rates can literally kill your budget in the future if you start falling behind on payments.
   
   
7. Reduce your exposure now to any investment in any corporation that has a large pension plan obligation. Pension obligations are not listed in the company's debt or financial statements, but there is a report that was issued by Standard and Poor's last year which outlines the top 300 companies that are in the red on their pension benefit obligations. Standard and Poor's lists over 31 companies that owe over a billion dollars to their pension benefit plans, with the largest debt being owed by Ford Motor Company. Standard & Poor's, Credit Suisse First Boston and many pension specialists project that there are many legacy corporations that owe more to their pension plans than they currently have on tap in their market capitalization. Click to review data from the 2004 report on Pensions.

Companies in the News (That Are Not on the Hot News List)
6 companies have consistently received GovernanceMetrics International's highest corporate governance rating of 10.0  in either five out of six, or six out of seven occasions (including the latest ratings), and thus represent companies with high governance standards and little governance risk. These companies are: BCE (Canada), Nexen (Canada), Colgate-Palmolive (US), Pepsico (US), Wisconsin Energy (US) and Westpac Bank (Australia).  GMI reports that, in contrast to the companies which scored the lowest in corporate governance - Apollo Group, The Australian Wheat Board, Audiovox, Biovail and Livedoor -- the composite total shareholder return over the last three years of the best 6 companies (through February 25) was 23.75%. (source: GovernanceMetrics International)

Fannie Mae. According to James Lockhart, Ofheo Acting Director, "They committed fraud. Fannie Mae had a culture of arrogance. There were manipulating earnings. They didn't follow generally accepted accounting standardsÉ We are going to watch them closely." FYI: NataliePace.com first began reporting on Fannie's problems in 2003, when the share price was still strong and investment advisors believed that the Federal government would take a hands-off approach to the policies that had resulted in one of the biggest debt/equity ratios, at 39 then (at 23.41 now), on the street. With that kind of risk going on, it probably pays to keep your hands off Fannie, no matter how much she has cleaned up her sheets!

EDUCATIONAL OPPORTUNITES AND INFORMATION:

1. Higher Interest Rates. The Federal Open Market Committee decided on 5.10.06 to raise its target for the federal funds rate by 25 basis points to 5 percent, for the 16^th consecutive rate hike, and believes that further tightening may be needed, depending upon the "evolution of the economic outlook." In our interpretation of "Fed-speak," that is likely to mean that Bernanke will be inclined to pause with the rate hikes, in order to be able to examine how the past 16 rate hikes are impacting the economy. As Bernanke testified before Congress in April, "At some point in the future the Committee may decide to take no action at one or more meetings in the interest of allowing more time to receive information relevant to the outlook." The next FOMC meeting is scheduled for June 28 and 29, 2006. Click to review the FOMC Press Release from the May 10th, 2006 meeting.
   
   
2. Entrepreneurs: If you are stuck in a financial rut, or if you have too much month at the end of your money, join us for a chat with Chellie Campbell, the author of Zero to Zillionaire, in the NataliePace.com chat room on Wednesday, June 14^th, at 8:45 a.m. PST (11:45 a.m. ET). Through her books and workshops, Chellie has helped literally thousands of entrepreneurs to attract profits and jump to the next revenue plateau, while reducing stress and enjoying life more.
   
   
3. We'll look to add Citigroup in September. Waiting to see what the next Fed meetings and the summer doldrums do to the markets. Citigroup reports 2Q earnings on July 17^th. Rising interest rates and the current M&A mania are positive for Citigroup, but interest rate hikes, combined with high oil prices and the summer doldrums, are tough on the markets.
   
   
4. 21 BIG WINNERS, even given the mid-May sell off!, which keeps the companies featured in NataliePace.com at the top in Annualized Returns (according to TipsTraders.com). This hot news article still has the proud honor of featuring twenty-one companies that have posted positive gains, versus just seven that have gone south. Of the seven that have gone south, we were most concerned with Krispy Kreme, but with the hiring of Kraft Foods veteran Daryl Brewster as president and chief executive that company seems to be sweetening up. Turnarounds are difficult to stomach, even the turnaround of the most popular sweet on the planet. Lawsuits and challenges remain. There has been upside over the past month for the patient, however. For RELM Wireless, Sirius Satellite Radio and Yahoo, we believe the company and the marketplace are ripe for more gains. If you've already bought in, it may be a rough summer. If you haven't, check back in September for any Back to School Stock Sales. Still love Jet Blue as a consumer, but the sector is in trouble until they figure out how to fly solar-powered planes. As we head into the summer doldrums, look for some stocks to trim back on and/or take your profits on, including Martha Stewart, Sony, Automated Data Processing, ImClone, and LifeCell.

Bottom Line: NataliePace.com is providing you with news and important information, but you need to consult your financial planner to determine your best strategy for using the information. That will depend upon your age, your retirement plan, and your risk tolerance and portfolio diversification. The stock portion of your portfolio is a higher risk classification, where you ideally seek to gain higher returns. As the NASD said in a recent investor alert, don't bet the farm on the stock market. NataliePace.com is NOT a brokerage and doesn't operate or act like one. We are an online media service with a mission of providing the news and information you need to make better choices in business, investing and personal prosperity. Always consult a trusted financial professional before buying or selling any security.

Full disclosure: I have listed the companies that I own under the column "NP OWNS?"

Hot Stocks
Investors who "never pay retail," note that highlighted stocks are trading at their 52-week lows or near the price featured in NataliePace.com's article. It may be a good buying opportunity. The companies that are listed below which are not highlighted may not be in a good buying range, but they appear to be poised to continue performing well. There are never any guarantees in life, and all stocks are risk-based investments. Consult your certified financial planner before making any changes to your investment strategy. You'll note, in the interest of moving from stocks to liquidity, we've moved a lot of our featured companies from this Buy or Hold opportunity list to our Hold or Sell opportunity list (below).

Cooling Off Stocks (that may be in Profit-Taking Range).
Note: If the news is still favorable on some of these companies for the long-term, if you have them in your 401K or long-term portfolio, you might want to keep them there. However, for the trading portion of your portfolio, in a market of modest gains but high volatility, many analysts recommend taking profits in shorter windows. A gain is a gain. We may look to add some of these great companies to our Hot News list again, if the price point should become attractive (as we did NetGear in March). The companies listed in bold have recently been added to this cooling off list. Investors who have them in their portfolio should read the recent news and consider whether it is time to sell and take profits, dump losses and/or simply take a long-range view of weathering the storms, while keeping the company in their long-term portfolio.

Note: Martha Stewart Omniliving, Sony and Sunoco were taken off of the Cooling Off Stocks list effective 5.12.06. MSO was slightly down. Sony and Sunoco had both had GREAT runs!

Please note: NataliePace.com does not act or operate like a broker. We are a media and information center. This article is intended to educate and inform individual investors, and, thus, to give investors a competitive edge in their personal decision-making. The publicly traded companies mentioned in this article are not intended to be buy or sell recommendations. ALWAYS do your research and/or consult an experienced, reputable financial professional before buying or selling any security.

Other articles of interest:
Affordable Health Care. by Dr. Gary Becker, Nobel Laureate, Economics.
Real Estate (REITs) Rules Wall Street, but For How Long? Market Update. By Paul Woods, President & CEO of Odyssey Advisors, LLC.
From Flipping Burgers to Owning Your Own Island. By Natalie Pace, NataliePace.com CEO and founder. How tithing 10% to Your Nest Egg will make you a millionaire, even if you're only bringing home $30,000
Investing is Not Surgery. Brokers are Not Surgeons. Why wise, informed, personal, daily, healthy choices keep you fiscally fit. By Natalie Pace, NataliePace.com CEO and founder.
Are GM, Delphi and Delta the Beginning of Japan-like Stagnation for the U.S.? Q&A with Nobel Laureate Economist Gary Becker. By Natalie Pace.
Want a Raise Now? It Could Be a Check Mark Away. by Maya Patel.
The Eastern European Renaissance. This Year's "It" Investment. Article and Stock Report Card by Natalie Pace.
Leave Your Job, Not Your 401(k) By Maya Patel. Discount Brokerages Make Rollover IRAs Easy.
NASD Investor Alert: Putting Too Much Stock in Your Company - A 401(k) Problem
What the Mutual Fund Salesman Forgot to Mention. by Paul Woods, President & CEO of Odyssey Advisors, LLC.

IMPORTANT DISCLAIMER: Information has been obtained from sources believed to be reliable however NataliePace.com LLC does not warrant its completeness or accuracy. Opinions constitute our judgment as of the date of this publication and are subject to change without notice. This material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. Securities, financial instruments or strategies mentioned herein may not be suitable for all investors.

VISION: To build a global community of investors through a worldwide website, seminars, radio, television and print partners.
GOAL: To provide high-quality, first-run, ethical financial news, information and education, presented in an entertaining format, across all media (television, radio, print and online).
MISSION: To provide the news, information and education investors need to make better choices and to make investing as much fun as shopping.
PHILOSOPHY: Member Mosaic. Piecing together a more complete picture of the publicly traded company, one tile at a time, by valuing firsthand consumer experience, conducting evaluations of the executive team and lining up the numbers of the publicly-traded company with its competitors in a Stock Report Card.
For more information on NataliePace.com contact us at www.NataliePace.com, P.O. Box 1350, Santa Monica, CA 90406-1350 or 1-866.476.7442 (toll-free telephone number).

NOTICE: NataliePace.com is NOT a stock brokerage service, and does not operate or act as one.