Neither bulls nor bears in 2011, LPL Financial Research expects the economy and the markets will be range bound in upcoming year. Bound by economic and fiscal forces that will restrain and not reverse growth, Shank Wealth Management believes the market will provide modest single digit rates of return. In 2011, business leaders, policymakers and investors will play important roles in shaping the investing environment. We anticipate that: The job market will stage a comeback. Slowing productivity gains have driven the need to bring on new workers. We believe business leaders will increase hiring, ultimately resulting the unemployment rate drifting lower. However, slow sales growth from tepid consumer spending will keep the pace of hiring modest. We expect nearly twice the pace of job creation experienced in 2010. The Gross Domestic Product (GDP) in 2011 will be near the long-term average between 2.5 and 3%. Policymakers and the Federal Reserve will deliver new economic stimulus packages in the new year. After supplying a record-breaking $1.75 trillion in stimulus in 2008-09. Later in the year, growth will drag as the federal stimulation fades and there is gridlock-induced shrinkage of the federal budget deficit. In 2011, investors will play it safe. Inflows to riskier markets will be anemic, contributing to a modest performance of both stocks and more aggressively postured bonds. Single-digit gains will remain under pressure and gains for bonds as yields will remain range bound. Currencies will also influence returns. A volatile, downward path for U.S. Dollar is a result of the current risky 'currency war.' Overall, 2011 will continue the economic and market volatility of 2010. The global economy remains out of balance, teetering back and forth between the soft spots that invoke a need for increasingly extended policy support and the growth spurts that provoke a desire to begin to pull back some of the stimulus. The last time government spending comprised as much of GDP as it does today, the period between 1945-1960, the economy was subject to heightened volatility driven by major swings in policymaking. Bill Shank & Christian Shank Shank Wealth Management 2627 Chestnut Ridge, Ste. 110 Kingwood, Texas 77339 281-359-3133 www.shankwm.com

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