The Feds continue with low interest rate policies due to a slower recovery than hoped.

Read this month’s report to learn how events beyond U.S. borders are culminating to impact U.S. financial policy and what it means to you as an investor.

1. How the geopolitical uprisings are swaying commodity prices. Troubles in the Middle East, a growing global Middle Class and possible changes in China’s financial policies are impacting the prices of gold and other commodities.

2. The world watches Obama’s new deal unfold. The President’s change of attitude could drive a new generation of US industries that promise jobs and future growth. Meanwhile, corporate earnings exceed expectations and consumers are hopeful as evidenced by stronger consumer confidence.

3. The Fed walks a fine line to keep the U.S. afloat. Will quantitative easing continue to erode the US dollar? Will low interest rates drive consumer spending and encourage corporations to rebuild their payrolls? Or are we headed toward hyper-inflation?

4. Seven potential investments to help weather the current economic climate. We offer seven investment ideas for you to discuss with your financial planner.

February 2011 economic outlook

iSSUE: FEBRUARY 2011

in The February Economic Newsletter You Will Learn:

An integrated approach to nurturing your wealth and achieving your financial goals.

Inside This Issue:

Economy ReportLas Vegas Real Estate Club

PAGE 2: Geopolitical events shape Geo-economic realities

PAGE 3: Gold’s rally may be short lived

PAGE 4: indicators oF u.s. Fiscal health

And Much More...

A lot has changed since our economic outlook last month. The biggest story has been the dramatic challenges in Egypt. i always try to break down what these types of global political situations mean to my subscribers. This is especially important now because the events in Egypt directly impact the United States and all Americas. Here is a summary of what i see happening. Egypt is the most populous Middle East country and has been a major factor in America’s influence in the region for over 30 years. in fact, Egypt has vital strategic importance to the United States and the entire Middle East. Specifically, Egypt has assisted with israeli-Palestinian peace negotiations and worked against islamist extremism and joined the United States in trying to contain the expansion of iran’s power.

The leader of Egypt, President Mubarak, has lost his legitimacy among the Egyptian people and he could end up using force to try and retain his power. We are seeing this in the news as several political factions demand changes and police and mobbing protestors fire on each other.

With the uprising in Egypt, the biggest worry is that the fall of Egypt’s government could set off a wave of other uprisings in the Middle East, because these countries are closely interwoven. For example, just days before Egypt erupted we saw the collapse of the Tunisian government and the ousting of its leaders. This dramatic shift in power may have served as the catalyst behind the Egyptian uprising.

A similar shift in Egypt could have an even more dramatic impact on the region, because if the Muslim Brotherhood takes control of Egypt, that coalition will tear up any peace treaties with israel. And if the potential new Egyptian government is hostile to israel, then the United States will be in a very difficult situation if israel asks for additional assistance. That’s

because the reality right now is that the U.S. has no extra cash to assist israel and participate in a new war in the Middle East.

This growing unrest and uncertainty has sent gold prices soaring again. in the coming weeks i will closely monitor this situation and how it impacts all subscribers on an individual basis.

The Federal Reserve Holds Steady on Interest Rates The biggest story directly affecting investors is the unanimous vote by Federal Reserve policymakers to hold interest rates at historic lows. The Fed predicts the rates will remain near zero for the foreseeable future.

The Feds also expressed continued concern with the lackluster performance of the economic recovery. The Feds cited that the growth in consumer spending was not enough to overcome high unemployment and lower housing wealth.

in addition, although corporations have massive reserves of cash they still remain reluctant to add to payrolls and the housing sector continues to be depressed.

Most important, the Feds say they would continue their program of buying $600 billion of longer term Treasury securities.

The rise in commodity prices continues to cause inflationary concerns for the Feds. if we were to see signs of hyper-inflation, then the Feds would be forced to raise interest rates, which would effectively kill any chance of a full economic recovery.

Geopolitical events shape Geo-economic realities

“The biggest story directly affecting investors is the unanimous vote by Federal Reserve policymakers to hold interest rates at historic lows. The Fed predicts the rates will remain near zero for the foreseeable future.”

grow. protect. invest.

As i mentioned, gold saw a rise in the last few days due to the situation in Egypt. Although investors flocked to the safety of precious metals in the midst of this uncertainty, i believe this rally will be short lived unless the Middle East situation intensifies. As the economy shows signs of recovery gold holders will sell off their gold positions to invest back into the stock market where they believe the returns will be stronger. For those who do not own any gold at this time, such a sell-off may be your opportunity to finally enter that market. Remember gold is to be held mainly as a hedge against uncertainty and if the economy improves that will lead to more confidence in the US dollar and gold prices will drop.

Longer term, i remain bullish on gold. And as stated earlier if the Middle East situation does not intensify, i believe we will see more downward pressure on gold and silver in the next several months.

Part of this movement out of precious metals is due to the strong earnings from S&P 500 companies. Seventy-five percent of these companies have met or exceeded earnings expectations. This strong performance is causing money to flow out of the Treasury bond market and into the stock market, but away from gold.

in addition, higher interest rates in China are also causing concerns for commodity investors and that will dampen demand for gold.

in the short term, i agree that we may also see a correction in commodity prices. However, the global Middle Class keeps growing and as a result, consumption increases and causes even more demand for commodities. Silver at this time is very weak technically. The only way we will see silver prices move up in the short term is if we see negative economic reports, which we are not seeing. Even new home sales reported last week were showing slight improvements.

President Obama Finally Gets It Right

Overall i was pleased with Obama’s State of the Union Address. He hit the right tone on education and the need for more industrial Research and Development, stating that the United States must spend more in these areas or it will lag behind.

China and india are definitely producing many more highly skilled workers than the United States is at this time and i believe outsourcing will continue to challenge the American workforce as jobs are shipped overseas. Unfortunately, i believe this means that high unemployment rates will be around for a very long time.

Another welcome relief was Obama’s increased focus on the issues concerning Americans rather than on issues concerning politicians. He showed in his speech that he is becoming less of a Socialist and even the right wing politicians gave him credit for his speech. This bodes well as Obama shows signs he will no longer be an obstacle for economic recovery.

grow. protect. invest.

Gold’s rally may be short lived“China and india are definitely producing many more highly skilled workers than the United States is at this time and i believe outsourcing will continue to challenge the American workforce as jobs are shipped overseas.”

“On the positive side, consumer confidence has grown stronger as more consumers reported being optimistic about their income and jobs.”

Indicators of U.S. Fiscal Health

The United States debt remains my biggest concern. The fiscal deficit for the year is $1.5 trillion. The overall debt is $14.3 trillion. That means that 40% of every dollar America borrows is being used to service the national debt.

On the positive side, consumer confidence has grown stronger as more consumers reported being optimistic about their income and jobs. As i have mentioned numerous times in the past, consumer confidence drives two-thirds of the U.S. economy and this indicator impacts many fiscal decisions - from the smallest business owner to the largest corporation as well as many government agencies.

in other positive economic news, the U.S. expansion rate for GDP is better than expected at 3.1%. Even the US dollar is moving higher as the social unrest in the Middle East is causing investors to move back into the US dollar, which creates more demand. However, this improvement in the US dollar was only a trend last week. As i mentioned earlier, i will monitor the situation in the Middle East to see if this “flight to the safety of the US dollar” continues.

Getting Down to Your Investments

it has only been a couple of weeks since my last economic update to my subscribers, which is why this update is shorter than usual. But it would not be complete without some insights into what i see happening on the investing front. Here are the areas that i would like you to consider and discuss with your licensed financial advisor:

1. Lower Gold Exposure. Longer term my outlook for gold is very bullish, but in the short term we could see weakness. The trend to buy gold could kick in again if the Middle East crisis heats up.

2. Dividend Paying Stocks. Many corporations have cash and there is pressure from shareholders to either use the cash or send out dividends. Discuss corporations with growing dividends with your financial advisor.

3. Corporate Bonds. Corporate bonds with triple A ratings are paying 6% on average. This is a very conservative investment for investors who are comfortable with a lower yield and want to sleep comfortably at night.

4. Oil investments. Oil will make sense on any pull back below $70. Such a pull back is a great opportunity to look at large oil producing companies.

5. Focus on Technology. With so much money in corporate bank accounts a lot of spending is occurring and much of that spending is being directed toward the technology sector. Find which tech companies are benefiting from this spending. Discuss this idea with your financial advisor or tune into the monthly economic outlook calls where licensed financial advisor Dominic Tersigni talks about specific companies.

6. Rare Earth Minerals. i spoke about this area in last month’s outlook report. investors must continue to pay attention to this area. China has cornered the market and the tech and medical industries are completely dependent on the 17 elements that make up Rare Earth. Stocks in this sector have skyrocketed - several thousand percentage points in some cases, but if we see continued shortages this high-risk/high-reward sector we could continue to see all Rare Earth stocks skyrocket. This is definitely an area to discuss with your financial advisor, but don’t bet all your cash here, because we don’t know exactly what China is hiding. For a comprehensive overview of Rare Earth elements please read last month’s Economic Outlook newsletter.

7. Cash Flow Real Estate. Las Vegas cash flow property remains the best area for conservative cash flow. The Median Price has dropped from $350,000 to $140,000 since 2007 and Vegas is definitely under-priced. The rents in relation to the purchase price of a property, as well as the affordability index, both remain the best of any North American city.

To get a closer look at this opportunity, you’ll want to attend the next Las Vegas Real Estate Economic Bootcamp being held March 21st right after our annual Summit. The Bootcamp is from 8:00 a.m. to 6:00 p.m. and the pick up spot is the Paris Paris Hotel, which is where we are hosting the Summit.

Tickets for the day-long Bootcamp are just $197 each and include lunch along with a guided tour of the Las Vegas Market. if you are interested to purchase a ticket simply send an email to education@allianceinvestor.com.

“Our Powerteam Financial Economic Summit, formerly known as investfest, is combining content, learning and entertainment all together in a first-class location”

Powerteam Financial Economic Summit

For those planning on attending the Powerteam Financial Economic Summit scheduled from March 17th to the 20th here is a quick update.

Back by popular demand is financial forecaster Steve Hawks, who will be discussing what is happening in the Real Estate Market and the best places to invest.

Our own monthly economic co-host Dominic Tersigni will talk about the economy and specific stocks you’ll want to discuss with your financial advisors.

Another guest is the largest holder of second mortgages in the United States with over $4 billion in assets. He is making a fortune and will explain how he is doing it.

World famous economist and best-selling author Harry Dent will also join our event as a speaker. You may want to check out one of his seven books to understand how well informed this man is and why hearing him speak will be so valuable.

Also in attendance this year is Richard Lee, who is one of the Nevada’s top respected public faces in the Las Vegas real estate industry. Lee has some important insights to share with Summit attendees.

The King of infomericals Joe Sugarman has made millions of dollars and he will also be giving a presentation that should be both informative and entertaining.

Tax liens were not the best investment until the collapse of the U.S. Real Estate market put so many homeowners behind on their property taxes. Now, people are making a fortune in this lucrative business once again. You’ll learn everything you need to know from North America’s top authority in this area.

Not only will you hear these speakers from the big stage, you will have the opportunity to interact with many of them one-on-one during the private workshops we have scheduled during the Summit.

Our Powerteam Financial Economic Summit, formerly known as investfest, is combining content, learning and entertainment all together in a first-class location. We are holding the event at a 5- Diamond resort on the Las Vegas Strip called the Paris Paris Hotel.

Once again, the dates are March 17th through the 20th, just before our Las Vegas Real Estate Bootcamp. Tickets for the Summit are just $497.

To get your tickets just send an email to education@allianceinvestor.com.

That wraps my report up for this month. i’m monitoring several issues affecting the investment world and will keep you on the inside track so you can position yourself for profit as things unfold.

As always, discuss these ideas with your licensed financial advisor, or better yet, invite them to listen in to our talks.

Until next month, remember that knowledge is power, but knowledge without action is just knowledge.

Mike LathigeePresident, Las Vegas Real Estate Club