Stone & Youngberg LLC Comments on the Debt
Market Commentary by Paul R. Touchstone, CFA Senior Investment Strategist and Portfolio Manager
July 29, 2011 10:33 AM Eastern Daylight Time
SAN FRANCISCO--(EON: Enhanced Online News)--Stone & Youngberg, a leading financial services firm and
the nation’s top underwriter of California and Arizona municipal bonds over the past five years1, is pleased to share
the following market commentary from the firm’s Asset Management Group regarding the debt ceiling debate:
While we prefer to avoid commentary on politics, our clients, colleagues and friends have encouraged us to opine on
the debt-ceiling debate that is taking place in Washington DC. There is no way to predict the outcome of this
political exercise, though we continue to err on the side of probabilities and believe that both sides will work
something out in advance of the August 2nd deadline. In a rational world governed by rational people, this issue
would have already been resolved.
Short-term rates and spreads are typically early indicators of stress in the capital markets. At this time, they are
showing little in the way of increased volatility or risk. Perhaps this is an indication that regardless of the outcome of
the debate, the US Treasury will pay interest and principal on time as they avoid an actual default on their debt
While the politicians act hysterical and the media creates a frenzy, investors would do well to maintain cooler heads
and focus less on the short-term effects and instead on the longer-term opportunities that are prevalent. These
opportunities may actually become cheaper in the days ahead in which case we may be compelled to add to our
Of note, commodities are off to an upbeat start this quarter as global leading indicators remain positive, retail sales
across the developed countries are healthy, and Japan’s industrial production rebounded sharply in April & May
following the sharp decline in March due to the devastating earthquake and tsunami earlier this year.
Some areas of the economy are decelerating, though corporate profits remain robust. 2/3rds of the companies in the
S&P 500 Index have reported 2nd quarter earnings and the results thus far have been solid. 70% of the companies
have beaten forecasts for bottom line profits & top line sales which is the strongest showing since 2006 and 2004
The August 2nd deadline will come and go and regardless of the resolution markets will continue to ebb and flow.
Our best defense is to remain disciplined in our approach and continue to set our sights on longer-term opportunities,
goals, and objectives.
If you have any questions or comments, please give us a call.
About Stone & Youngberg Asset Management
As a complement to our fixed-income brokerage services, Stone & Youngberg offers fee-based asset management
to individuals and institutions. Our approach relies on reducing volatility and minimizing exposure to risk. This is
designed to increase the probability of meeting our investors’ financial objectives. Disciplined risk management,
planning, and communication are essential in formulating long-term, successful investment strategy.
To learn more, please give us a call or visit www.syllc.com/amg.
Important Information: Stone & Youngberg's asset management services are only available in states in which the
firm and or its associated persons are registered or exempt from registration. Information presented on this website is
not intended as a solicitation of products or services or a recommendation of any investment or investment strategy.
This release is for informational purposes only and are solely the views of its author. These views are subject to
change at any time based on market conditions and the author does not undertake to update the reader of any
changes in opinion or information. Readers should evaluate his or her personal situation with a professional before
investing. The information presented should not be construed as investment advice or guidance as to the
appropriateness of any investment decision or as a recommendation as to any specific security, sector or strategy.
Past performance does not guarantee future results. All investing involves risk and the value of your investment will
fluctuate over time and you may gain or lose money.
About Stone & Youngberg: Stone & Youngberg Holdings LLC is a financial services company providing a range
of products and services. Stone & Youngberg LLC, founded in 1931 and member FINRA/SIPC, specializes in the
origination and sale of fixed-income securities. The firm led or co-managed the sale of 927 municipal bond issues
totaling $21 billion over the past five years.1 In addition to bond underwriting and sales, Stone & Youngberg
provides investment services to individuals, institutions, and government agencies and offers a wide variety of tax-
exempt and taxable securities.
Additional information is available at www.syllc.com or by calling 800-447-8663.
¹ Based on number of bond issues 2006-2010, Thomson Reuters 2011
Stone & Youngberg LLC
Steve Hall, 415-445-2656
Pierce Communications Group LLC
Kimberley Pierce, 510-326-0058