(1888PressRelease)
February 27, 2007 - AUSTIN, Texas – February 27, 2007 – “While the economy should stage another respectable performance in the first quarter, we are looking for a weakening trend to set in towards the end of the period, presaging several quarters of below-trend growth,” said Robert G. Smith, Sage Advisory president and CIO. “If the gradual reduction in inflationary pressures unfolds as we expect, that should open the door for the Fed to ease rates sometime in the second half of the year.”
Smith cited several factors that have led the U.S. to enjoy an upbeat first quarter. For one, the economy is still feeling the positive effects of households that are still spending their savings from lower energy costs in late 2006, as well as redeeming gift cards. Steady job gains and higher wages are increasing household income, and foreign investment in corporate bonds are keeping borrowing costs down. Capital outlays by business are also up.
However, he warned, other influences coming into play may upset that balance.
“We doubt that the full effects of the housing drag has been felt,” he said. “Its impact will become more apparent once the temporary growth boost from the mild weather of December and early January and low energy costs dissipates. Relatively low bond rates also signal that investors expect the economy to weaken considerably, inflation to stay low and interest rates to fall.
“It is a close call as to what the Fed will do in coming months. However, it is our sense that the next move is likely to be a cut rather than an increase, following its traditional role of lowering rates to stimulate the economy.”
For a more complete economic analysis, visit www.sageadvisory.com and download SageAdvice “Quarterly Economic Outlook, First Quarter 2007.”
About Sage Advisory Services
Founded in 1996, Sage Advisory Services is a national investment management and financial advisory firm that provides institutions and high-net-worth individuals with customized products and services including fixed-income and equity portfolio management, asset/liability analysis and structured portfolio solutions designed to minimize financial risk and increase returns. Sage is one of the fastest growing companies in Central Texas, with an AUM (assets under management) growth rate of 20 percent per year over the past five years. Its consistently high performance record is a result of its proprietary investment process, as well as its dedication to offering clients exclusive representation by senior-level managers with global expertise.
Sage’s investment management strategy employs a top-down approach to market analysis, taking into account broad domestic, international and economic trends when applying portfolio management strategies. And while most investment management firms have limited experience with exchange-traded funds, Sage offers an in-depth understanding of ETFs and a highly successful five-year performance record managing ETF portfolios.
Reflecting its commitment to providing education and transparency, Sage provides frequent access to up-to-date information on investment fundamentals, market trends and economic issues affecting client investments, and 24-hour real-time access to information about investment activity. For more information, visit www.sageadvisory.com.
CONTACT:
Laura P. Wright
Blabbermouth PR
512-461-5777
laura ( @ ) blabbermouthpr dot com
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