More On Legal & Compliancefrom The Advisor's Professional Library
- The Need for Thorough and Effective Policies and Procedures Whethere an advisor is SEC or state-registered, RIAs must revise their policies and procedures to address significant compliance problems occurring during the year, changes in business arrangements, and regulatory developments.
- Differences Between State and SEC Regulation of Investment Advisors States may impose licensing or registration requirements on IARs doing business in their jurisdiction, even if the IAR works for an SEC-registered firm. States may investigate and prosecute fraud by any IAR in their jurisdiction, even if the individual works for an SEC-registered firm.
The Dow Jones industrials posted a gain of 401.03 points in the week ending October 17, 2008, or a rise of 4.75%, to close at 8,852.22, the biggest one week improvement since March 2003. That good news followed the worst week ever for the Dow--that of October 6-10--when the Dow plummeted 1,874.19 points, or 18.2%, to close at 8,451.49. Before that, the worst week ever was the one that ended July 22, 1933 when the Dow posted a 17% decline.
For the year, the Dow is off 33.27%, while the S&P 500 is off 35.95%. Beyond those indexes, the closely watched VIX measure of volatility reached an all-time high on October 16 of 81.170 but then settled down; it closed on October 17 at 70.33, a level that many observers of the "fear" index suggest might indicate a market capitulation that would precede a major rally.
Ron Schwartz, manager of the municipal bond fund RidgeWorth Investment Grade Tax Exempt (SISIX) admits that for the investor, this is a "challenging environment to say the least," and since he suspects that we are "going into a bad recession...the worst in 20 years...there will be fiscal pressures throughout" the country. While Schwartz argues that now is a "great opportunity to go into munis--they're cheap" he counsels that now is not the time to go into anything for the short term, "because nobody knows for sure what's going to happen short term."
In the week ahead, government reports on leading economic indicators are due out on October 20, jobless claims on October 23, and existing home sales are to be released Friday, October 24. Earnings reports are due October 20 for American Express, October 21 for U.S. Bancorp, and October 22 for Travelers.
On October 17, ING, the Netherlands' biggest bank, announced that it expected to post its first-ever quarterly loss in its third quarter of $674 million, though it still expected to post a healthy profit for the first nine months of the year. On Sunday, October 19, the Dutch Finance Ministry and central bank announced that the government would invest $13.4 billion into the bank in exchange for warrants.