RECOVERY PLAN

OUR OVERALL STRATEGY

NOTE:  A NEW 100 DAY TRADING CHART HAS BEEN UPLOADED ON 11 FEB 2010 (CLICK HERE TO VIEW)

1.  LET'S KEEP THINGS SORT OF SIMPLE.  WHENEVER YOU GO AFTER AN INVESTMENT RETURN GREATER THAN A GUARANTEED RATE OF RETURN FROM THE PERFECT INVESTMENT, YOU ARE AT RISK.  CLICK HERE TO SEE A CHART OF THE DOW JONES , NASDAQ , AND STANDARD AND POOR'S 500 INDICES COMPARED TO THE DIAMONDS TRUST SERIES A (DIA) ETF THAT CONTAINS AN APPROXIMATE EQUAL WEIGHTING OF THE DOW 30 STOCKS THAT COMPRISES THE DOW INDEX.  THE TRUST WAS STARTED IN JAN 1998.  THEREFORE, IT REPRESENTS AN INTERESTING WAY TO EVALUATE HOW OUR INVESTMENTS ARE DOING IN RELATION TO THE THOUSANDS OF STOCKS THAT WE COULD INVEST IN.  THE MAJOR POINT HERE IS SIMPLY THAT LOOK AT HOW ALL OF THE INDICES ARE MOVING VIRTUALLY TOGETHER.  WITH THE EXCEPTION OF HUGE BUBBLE EXHIBITED BY THE NASDAQ, ALL ARE CLOSELY ALIGNED WITH THE ETF TRADING SYMBOL "DIA".  SO, CLICK HERE AND SEE FOR YOURSELF, AND THEN HIT YOUR BACK BUTTON AND COME BACK AND READ THE NEXT OBSERVATION.

2.  LET'S JUST CONCENTRATE ON THE ETF SYMBOL "DIA" FOR THE MOMENT.  IF WE PUT ALL OF OUR FUNDS IN THE "DIA" ETF, IT WOULD BE ABOUT THE SAME AS BUYING A BASKET FULL OF ALL OF THE DOW 30 STOCKS.  THAT IS BECAUSE THE ETF IN FACT COMPRISES THE DOW 30 STOCKS.  BUT REMEMBER, THE DOW JONES INDEX IS NOT EQUALLY WEIGHTED.  YOU NEED TO UNDERSTAND HOW THE INDEX IS INFLUENCED BY DIFFERENT STOCKS.  FOR EXAMPLE, IBM COMPRISES NEARLY 10 PERECENT OF THE ENTIRE INDEX OF THE 30 STOCKS.  FURTHERMORE, 16 STOCKS REPRESENT APROXIMATELY 75 PERCENT OF THE ENTIRE INDEX.  SO, WHAT'S THE POINT?  AS THE SAYING GOES, HOW GOES BIG BLUE (IBM), GOES THE WORLD.  CLICK HERE TO VIEW EXACTLY WHAT I'M TALKING ABOUT AND THEN HIT YOUR BACK BUTTON AND COME BACK AND READ THE NEXT OBSERVATION.

3.  NOW LET'S GO BACK AND LOOK AT A DESCRIPTION OF THE ETF "DIA" AND YOU CAN SEE HOW THE DOW IS BASICALLY BROKEN DOWN INTO SECTORS AND CONFIRM IN YOUR MIND THE ETF DOES BASICALLY TRACK THE DOW 30.  LOOK OVER THE DESCRIPTION OF THE ETF SO YOU FEEL COMFORTABLE WITH THE OBSERVATION THAT FOLLOWING THE SYMBOL "DIA" IS MORE OR LESS A GOOD INDICATION OF HOW YOU COULD GENERALLY EXPECT YOUR ACCOUNT TO LOOK IF YOU WERE 100% INVESTED IN THE ETF "DIA" WHICH APPEARS TO MORE OR LESS FOLLOW THE MAJORITY OF INVESTMENTS IN THE STOCK MARKET.

4.  SO WHAT'S THE POINT OF ALL THIS?  FIRST OF ALL IT SEEMS LOGICAL THE PERFORMANCE OF THE ETF "DIA" CAN GIVE US A FEEL OF HOW WELL THINGS SHOULD BE GOING IN OUR ACCOUNT.  IF WE ARE DOING EXTREMELY WELL, OR MUCH BETTER THAN THE "DIA" RETURN, WE HAVE EITHER BEEN FORTUNATE IN SELECTING SOME REAL "WINNERS" OR HAVE A GREAT DEAL OF THE ASSETS IN A RISKIER POSITION---SUCH AS HEAVILY ALLOCATED TO A SMALL NUMBER OF "WINNING" STOCKS OR A SECTOR THAT IS REALLY HOT.  THE CURRENT RETURN MAY BE FANTASTIC WHILE IT LASTS, BUT WITHOUT DIVERSIFICATION, WHEN THE THE STOCKS OR THE SECTOR COOL DOWN, WE WILL BE ON THE LOSING END OF THE TRANSACTION.  LET'S NOW TAKE A LOOK AT WHERE WE HAVE BEEN AND WHERE WE ARE IN RELATION TO ETF"DIA".  AFTER LOOKING OVER THE DATA, HIT YOUR BACK BUTTON AND COME BACK FOR A REVIEW OF HOW WE MIGHT WANT TO PROCEED.

5.  THE DATA WE HAVE HAS SOME GAPS WE NEED TO FILL IN AS TIME GOES ON.  A GOOD OVERALL GOAL IS TO GET BACK TO WHERE WE WERE ON 31 DEC 97.  TO DO THIS WE NEED A PLAN.    a.  The strategy needs to reduce exposure to risk through diversification.  For now, we will have a goal of bringing the total assets in all accounts in line with the following percentages:         1.  Not more than 5% in any one entity such as a stock, fund or bond.         2.  Not more than 20% in foreign markets.         3.  Not more than 20% in any one sector.    b.  Our main focus for the moment will be the DOW 30 stocks.  We will look at other opportunites with stocks followed for a long time.    c.  We will keep between 5 to 20 percent in money market at any one time and search for higher yields in secure instruments such as treasury and equivalents.    d.  We will use covered call writing to help increase total return if possible and cushion us if possible from markets corrections.

6.  THIS SECTION IS STILL UNDER CONSTRUCTION, HOWEVER CLICK ON THE FOLLOWING LINKS FOR ADDITIONAL INFORMATION: 1.  Allocations and values. 2.  Performance.  Comparison with different statistics. 3.  The BBC Global Index and information. 4.  The BBC Global Index and world market information. 5.  The DOW 30 Index and information. 6.  Railroad loadings within the US.

7.  Click on the following links for company specific information. 1.  Proctor and Gamble. 2.  Walmart. 3.  Alcoa. 4.  Metropolitan Life. 5.  Energy ETF. 6.  Gold ETF, 7.  American Express and other banking information. 8.  General Electric.

11FEB10