MORE HEADLINES
Economic Update
Economists are predicting that the intensity of the recession should ease by this summer.
Domestic Equity
U.S. equities fell in the first quarter, but the decline was muted by a market rally in March.
International Equity
Emerging markets turned positive for the quarter.
Fixed Income
High yield bonds posted exceptional first quarter results.
Real Estate Securities
Real estate investment trusts (REITs) underperformed the broad equity market.
Hedge Funds
Lack of market exposure enabled hedge funds to protect capital.
MARKET REVIEW
The unemployment rate hit 8.5% in March, with many economists expecting the jobless rate to approach 10% by the end of the year. GDP fell an annualized 6.5% in the fourth quarter of 2008 and a further 6.1% in the first quarter of 2009. Corporate earnings continued to fall, leading to further declines in the stock market. The inflation rate, as measured by the Consumer Price Index, declined 0.4% over the last year. This was the first time since 1955 that the year-over-year CPI was negative, leading to concerns about deflation and talk that the U.S. economy could be headed towards a period of stagnation, similar to Japan since 1988. The bad news is not confined to the U.S., as most of the major economies are now in a recession and their governments are introducing similar unprecedented
