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Weekly Invoguement Letter

|Includes: Citigroup Inc. (C)

The Beige book is an anecdotal report generated roughly two weeks before Federal Open Market Committee meetings in order to gauge economic activity and aid the overall outlook of the economy for policy makers. Each report has concluded an enhanced improvement which begs to question if/when policy is to be tightened?

Market Watch: Dubai and Abu Dhabi equities advanced over the weekend as a 13% sell off may have been overdone. Watch out for companies where a significant holding belongs to any Arab nation as they may follow Kuwait’s move in liquidating. (Kuwait sold $4.1B of Citigroup’s stock recently). Both Washington and Wall Street will be focussed on consumer credit and consumer sentiment this week which may back up Friday’s unemployment figures.  

Highlights of Last week: Employment and non-farm payrolls came out on Friday and made a dramatic surprise to the upside. It appears businesses are now hiring as the unemployment rate drops from 10.2% to 10%. However, taken in context – we had almost a .5% gain the month before. The Dollar strengthened and may be the beginning of the end for any relationship between equities and the USD. Ben Bernanke was questioned and received endorsements from Chris Dodd and others.