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BOSTON — Playing it safe paid off in 2008 for Tom Forester and David Ellison, two standout mutual fund managers in a year when winning meant losing less money than the competition.

Forester’s eponymous Forester Value Fund (FVALX) focused on stocks that typically do well in recessions to roughly break even for the year, declining just 0.82 percent through Tuesday — easily making it the top-performing large-cap value fund of the year, according to Morningstar Inc. data. The second-place Copley Fund was down nearly 17 percent, which was still well above the average decline in the category of 38 percent.

Ellison’s FBR Small Cap Financial Fund (FBRSX) also stood out in 2008, ranking No. 2 among financial sector funds. It shed just 10 percent of its value, easily beating the category’s average decline of 45 percent.

If the economy is poised to turn around, Forester and Ellison might do well to heed the contrarian investment maxim that yesterday’s winners are likely to be tomorrow’s losers.
But the two managers — both of whose funds carry Morningstar’s five-star ranking — aren’t yet ready to budge from the approaches that served them so well in 2008. Neither sees enough positive economic news to merit shifting from investments that typically do OK in recessions to those more likely to gain when conditions improve.

"I’ll probably be in some of the same stocks for the first six months or so of 2009," said Forester, whose recent success has drawn new clients and boosted his fund’s assets more than fivefold since the start of 2008, to $55 million. "And then as I see things getting better, I’m going to shift out of the real defensive things, and get more constructive on the more cyclical stocks that can grow quite well as we come out of this period."

The fund’s top five holdings as of Sept. 30 included Kraft Foods Inc., Johnson & Johnson and H.J. Heinz Co. — three companies that managed to outperform broader markets for the year, with their shares all losing less than 20 percent cash advance no fax. Other 2008 investments included Wal-Mart Stores Inc. and McDonald’s Corp., which draw budget-conscious consumers during hard times.

Forester also spent 2008 easing out of financial stocks with heavy exposure to the mortgage meltdown, and unloading energy holdings before skyrocketing oil prices reversed course.

While Forester used much of his fund’s cash holdings to snap up low-priced stocks in the third quarter, Ellison continues to keep plenty of money on the sidelines. About 40 percent of his $179 million fund’s assets are in cash, and Ellison said he doesn’t plan to use much of it until he sees signs that the slide in home prices and surge in job cuts are about to end.

The former bank teller has managed his small-banking specialty fund since its inception 12 years ago. While smaller banks generally weren’t as exposed to mortgage troubles as much as larger rivals, Ellison took pains to find the small banks with the least risk. Shares of his fund’s top holding, Paramus, N.J.-based Hudson City Bancorp., were up about 4 percent for the year.

Now, the key for both Ellison and Forester is figuring out when to adjust their strategies as markets eventually build momentum for an expected rebound.

Forester expects that to happen around mid-2009, when he hopes to move out of defensive stocks and into industrial and technology companies whose business tends to move in tandem with the economy.

Ellison is confident his small bank investment niche will continue to perform relatively well, but he doesn’t believe big profits are just around the corner for small banks. There are too many uncertainties in the economy, and currently low borrowing rates for everything from mortgages to auto loans will pressure all banks’ bottom lines. So for now, Ellison hopes to keep plenty of cash on the sidelines.

"I think unaffordable mortgages are still going to chew on the economy for a while," he said.

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When Alan and Pat Richardson moved their upscale European furniture store to downtown St. Louis from Ballwin in June 2007, they expected a temporary slowdown because of the relocation.

But what the owners of English Living didn’t count on was the recession, and within months of the move tough times came calling.

"We saw what was happening in the housing market," said Alan Richardson. "We knew we were facing something, and we had to make some significant changes.

"We trimmed 40 percent of our payroll in preparation for what we thought was a storm coming. The storm came, and we thought by now, we’d be out of it."

Such hasn’t been the case.

Sales in October and November, typically the strongest months, were down 5 percent for the store at 1520 Washington Avenue. And that was on top of a 10 percent decline a year ago, after the store moved.

While the economy is hurting a range of retailers, merchants in the furniture and home furnishing business are particularly being slammed because of plunging house sales and cutbacks in big-ticket discretionary purchases.

Nationally, sales by furniture and home furnishing stores totaled $8.7 billion in November, down nearly 11 percent from sales of $9.8 billion in November of last year, according to advance figures from the U.S. Census Bureau. In comparison, sales at clothing and clothing accessory stores fell 5.8 percent. "For (furniture) retailers, it’s pretty bleak right now," said Jackie Hirschhaut, vice president of marketing for the American Home Furnishings Alliance, the nation’s largest trade association for furniture manufacturers.

Factors that can compound the problems range from bad locations to run-of-the-mill merchandise.

"It’s been rough this past year," said Susan Block, owner of The Designing Block, at 7735 Clayton Road near Hanley Road. "First we got hurt by Highway 40. Then we got hit with the economy. We really got a double dose.

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"We’re not dying, I’m not going belly up, but I’m off a whole lot from the previous year."

For example, gifts being shipped from the store are about 80 percent fewer than last year, and the store was struggling to sell a piece of furniture this holiday season.

In contrast, Mueller Furniture, at 1004 East Main Street in Belleville, says its location is a huge plus.

"When the big financial crisis hit in October, we had three unusually slow days," said owner Lynwood Mueller. But that was it.

October sales figures were slightly more than the previous year, and November brought a double-digit increase. Mueller also is expecting an increase in December figures, even though the month is usually slow for furniture sales.

Mueller says the Metro East area, which is home to major employers such as Scott Air Force Base and hospitals, has helped insulate his business from the recession.

"We’re not so dependent on manufacturing," he said.

Being able to offer more promotional goods has helped Carol House Furniture at 2332 Millpark Drive in Maryland Heights, said co-owner Brook Dubman.

"There are many more opportunities for us to buy closeouts and specials. We have the warehouse space to stock up," he said.

While business is down for the year, it’s only by a little, he said.

"That’s pretty good considering the stories you hear out there," Dubman said.

Discount prices also are helping Good Works at 6323 Delmar Boulevard, which opened an outlet store in August. Both stores are in the Delmar Loop area.

Owners Chris Dougher and Rita Navarro made the move after closing the Good Works location in downtown St. Louis because of a lack of customers. The store, which was shuttered in June, was open about eight months.

"There’s no question it’s a tough time. Fortunately we opened the outlet and it helped us maintain levels," Dougher said.

The outlet, at 6707 Vernon Avenue, is open Fridays and Saturdays and offers furniture at about 40 percent off the regular price.

Although Good Works didn’t succeed downtown, Alan Richardson says he believes the locale is the right spot for English Living and he plans to stay.

Located in the historic Ely Walker building, the store offers hard-to-find imported wooden furniture, antiques and custom-made pieces.

A big plus is the store’s bustling tea room that sells about 50 loose teas.

"The tea room has scored for us. It makes the store a destination," Richardson said.

gappleson@post-dispatch.com | 314-340-8331

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Ontario’s ailing auto sector will get the CPR it needs from the federal and provincial governments to avoid a "doomsday scenario" that would result in thousands of job losses, Ontario Economic Development Minister Michael Bryant said today.

A report prepared for the Ontario government warning Canada could lose more than 580,000 jobs within five years if the Detroit Three automakers go out of business shows that a proposed $3-billion rescue package is needed to avoid a "catastrophic" chain of events, Bryant said.

"We are talking about CPR, literally, CPR for a company to avoid it from going under and causing a chain of events that would be catastrophic to the economy," Bryant said.

"It’s our job as government, because there is no private capital available, to step in and provide that CPR and eventually that life support to allow the intensive care to these businesses that will allow them to transform."

On Friday, federal Industry Minister Tony Clement said Ottawa and Ontario agreed to provide the equivalent of 20 per cent of whatever emergency aid the Bush administration gives to the companies – a figure proportional to the number of vehicles produced in Canada.

The aid won’t come until the U.S. makes its own plans known. The plan has been criticized by some for using taxpayer money to bailout international companies that have failed to manage their own affairs.

Bryant said the government isn’t looking to enhance or even preserve shareholder value for GM, Ford and Chrysler, nor does it want to necessarily sustain the current management.

"We’re not just talking, in that sense, about GM and Chrysler as manufactures themselves, it’s also all of their creditors, all of those workers, all of those suppliers, all of those parts manufacturers and all of those car dealerships," he said payday loans for bad credit.

"All that adds up to a massive industry.

"Auto is to Ontario what the oilsands is to Alberta, and I don’t anybody would suggest that the oilsands is expendable to our economy."

The report paints a gloomy picture if the Ontario, federal and U.S. governments do not bail out the automakers.

It warns the collapse of General Motors, Ford and Chrysler would send lasting shock waves through the economy, and that Ontario alone would lose 517,000 jobs.

If auto output by U.S.-based manufacturers in Canada was cut in half, at least 157,400 jobs would be lost right away, 141,000 of them in Ontario.

"This report says that Canada is better off providing life support to GM and Chrysler because the demise of auto in Canada is the economic equivalent of a nuclear freeze with catastrophic effects that would knock us into a deep recession," Bryant said.

He denied that the report is alarmist or that it was released to rally support for the government’s plans.

"They’re doomsday scenarios and the governments of Ontario and Canada will make sure that they don’t happen," he said.

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Nintendo Co Ltd said sales of its Wii game console more than doubled during the week of Thanksgiving in the United States, apparently defying the retail gloom of the global economic crisis.

President Satoru Iwata told Reuters in an interview that Wii sales more than doubled to about 800,000 units during the week of Thanksgiving, from about 350,000 units a year earlier.

While Iwata did not give specific dates, he said the sales were measured over a seven-day period that included both Thanksgiving and the so-called Black Friday for U.S. retailers, which is the traditional start of the holiday shopping season and when retailers rack up their biggest sales of the year.

“Fortunately for us a lot of shoppers put our products at the top of their list,” Iwata said on Monday.

He said sales of its DS handheld game player were up about 20 percent year-on-year during the holiday period. European Wii sales so far this holiday season have outstripped last year’s, he said.

“We are shooting for quite big numbers as our annual (unit) sales targets. But we are not in a situation where it is getting difficult to hit that target or our plans are getting off track,” Iwata said.

Nintendo, locked in a three-way battle with Sony Corp and Microsoft Corp in the global video game industry, aims to sell 27.5 million units of the Wii in the year to end-March, up 48 percent from a year earlier.

Since 2002, Iwata has focused on expanding the overall gaming population by launching game machines and software like the ‘Wii Fit’ home exercise game, rather than competing head-on with Sony and Microsoft in enhancing the speed and power of game consoles fast pay day loan.

That strategy appears to have paid off handsomely as the Wii is outselling Sony’s PlayStation 3 and Microsoft’s Xbox 360 by a large margin, allowing Nintendo to forecast an operating profit more than three times as big as Sony’s.

“When similar products are on store shelves, price competition is inevitable. Nintendo has been trying to steer clear of that direction and create a market of our own,” Iwata said. “Our effort in the past is now bearing fruit.”

NOT OUT OF STEAM

Worldwide Wii sales came to 34.6 million units at end-September, against about 16.8 million for the PlayStation 3 and about 22.5 million for Microsoft Corp’s Xbox 360.

“The competition stage is over,” Nomura Securities analyst Yuta Sakurai said. “The spread on shipment volumes is so large that it’s not even worth talking about it. They aren’t rivals.”

For a graphic on hardware sales by Nintendo and its rivals, click here

Iwata said people tended to pick video games even when their budget was tight as they were affordable. 

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It’s one of the biggest if not the biggest asset for millions of Americans in or near retirement. Despite a global financial crisis, it has kept all of its value.

But we have little practical knowledge of this asset — assuming we even think about how to get the most out of it.

I am taking about Social Security retirement benefits, which by all rights should be a major component of any retirement income plan.

Consider: The average monthly Social Security retirement benefit, after a 5.8 cost-of-living increase, will be about $1,153 in 2009. To receive that much inflation-adjusted income for life, a 65-year-old man would have to pay an insurance company a lump-sum premium of about $204,000 for an immediate annuity, and a 65-year-old woman about $225,000, based on the lowest quotes I found from highly rated companies.
Is your IRA or 401(k) worth that much? In addition, Social Security offers attractive spousal and survivor benefits.

Clearly, we should pay attention to the ins and outs of Social Security. The decision of when best to start collecting benefits — as early as age 62 for reduced benefits to as late as age 70 for enhanced benefits, or anywhere in between — can hinge on many factors.

Aside from any immediate need for money, these factors include how long you expect to live, your tax bracket, whether you’re still working and whether you are single or married.

"Social Security-related decisions can be complex and there can be tradeoffs," said Carolyn Clancy, an executive from Fidelity Investments. A recent online survey commissioned by Fidelity shows many Americans lack the basic knowledge to understand these tradeoffs and make informed decisions.

A vast majority (85 percent) of 300 61-year-olds surveyed did identify age 62 as the earliest they can start collecting reduced benefits. But 56 percent didn’t know when they would receive unreduced benefits if they waited to collect same day payday loans. (The answer is age 66 for anyone born between 1943 and 1954. After that, the age of eligibility rises by two months every year until it becomes age 67 for those born in 1960 or later.)

More than half didn’t know we have to file for benefits three months before we want to start receiving them. Almost a third believed incorrectly that Social Security benefits are not taxed (up to 85 percent of benefits may be taxed depending on what other income we have).

Nearly three-quarters didn’t know that a non-working or lesser-earning spouse could be eligible for benefits based on the work record of the higher-earning spouse. More than half didn’t know that a surviving spouse could be eligible to receive the Social Security benefit of the deceased spouse if it was larger than the survivor’s own benefit.

Also, 45 percent of the 61-year-olds say they plan to start taking benefits as soon as they are eligible at age 62. The most common reason given was that they need the money.

Such an action would lower their benefits permanently. Among those planning to collect as soon as possible, 73 percent didn’t have a retirement income plan. So perhaps there is another way to bridge the income gap until full retirement age that they didn’t consider.

Also, just 22 percent said they knew exactly how much their benefits would be — and 26 percent had no idea. And yet Social Security has been mailing Americans an annual benefits estimate since 1997, and this year the agency introduced an improved benefits estimator at www.socialsecurity.gov/estimator). Fidelity also has launched a site, www.socialsecurity.com/socialsecurity, that while obviously commercial does include valuable educational information.

AskHumberto@aol.com

2008, TRIBUNE MEDIA SERVICES INC.

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OTTAWA–Tourism generated $19.7 billion of revenue for governments in Canada in 2007, boosted 4.3 per cent over 2006 by domestic travel.

Statistics Canada reports government revenue from domestic tourism rose 6.1 per cent to just over $14.5 billion last year, while revenue from international visitors dropped 0.6 per cent to $5.1 billion.

The agency says the share of government revenue from international visitors declined to about a quarter last year from just over a third in 2000.

Taxes on products, such as the goods-and-services tax and provincial sales taxes, were the single largest source of tourism revenue for the federal, provincial and territorial governments.

These taxes accounted for $4.7 billion for the federal government in 2007, half its revenue from tourism.

Provincial and territorial governments collected $5 payday advance services.5 billion from taxes, 60 per cent of their tourism revenue.

These tax revenues rose just 2.7 per cent in 2007, the second straight year of weak gains, largely due to one-percentage-point drop in the GST that took effect in July 2006.

Taxes on employment income and business profits were the second most important source of tourism revenue for both the federal and provincial and territorial governments.

Income taxes directly attributable to tourism rose 9.4 per cent in 2007, reflecting gains in both personal and corporate incomes and associated taxes.

These taxes brought in $3 billion for the federal government and another $1.9 billion for provincial and territorial governments.

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Enterprise Financial Services Corp. of Clayton is preparing to raise up to $62 million in new capital to position the banking company for growth in a period of economic uncertainty.

Peter Benoist, Enterprise Financial president and CEO, said Thursday that the company will consider seeking the new capital from a combination of sources, including the government’s Troubled Asset Relief Program and private equity groups.

Enterprise remains well capitalized, Benoist said, but it wants to be ready to take advantage of opportunities that may arise while weathering the "uncharted waters of the financial industry.

"The financial industry is transforming right before our eyes," Benoist said, "and it’s clear to me that highly focused, well-capitalized commercial banking organizations in attractive markets will be the ultimate winners when the dust settles."

Banks must apply for the TARP funds by Nov. 14, and the process of gaining approval likely will take 30 to 45 days after a bank applies. Enterprise also has been working with investors on raising money by selling convertible trust preferred securities.

Enterprise, the parent of Enterprise Bank & Trust, also reported a 74 percent drop in third-quarter profit after it took a $5 free credit report instantly.9 million goodwill impairment charge.

The charge relates to Millennium Brokerage Group, a wholesale insurance subsidiary Enterprise bought several years ago. The charge reflects margin pressure in insurance as carriers consolidate.

Enterprise said it is looking at strategic options to improve the brokerage. Often companies talk in terms of strategic options when they are considering selling an asset.

The non-cash charge doesn’t reduce the bank’s regulatory capital, cash flow or liquidity, the company said. Enterprise bank’s earnings, which exclude the charge, were about even with last year’s.

Benoist said the bank is seeing loan growth despite the troubled economy. That growth may slow going forward, but the bank also has been able to increase pricing.

Enterprise completed the previously announced sale of its Great American Bank charter and a branch in DeSoto, Kan., to First Financial Bancshares Inc. of Lawrence, Kan. The sale generated an after-tax gain of $1.5 million or 12 cents a share.

jerristroud@post-dispatch.com

314-340-8384

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Philip Morris International said Wednesday its third-quarter profit rose 20.6% as sales climbed and a weak dollar boosted results.

The results led the company to reaffirm its full-year profit forecast for 2008.

The world’s biggest non-governmental cigarette maker reported net income for the quarter of $2.1 billion, or $1.01 per share, compared with $1.73 billion, or 82 cents per share, a year ago.

Philip Morris International Inc. (PM) - which sells Marlboros outside the U.S. and has offices in Lausanne, Switzerland and New York - said revenue rose 22% to $17.37 billion. Sales rose 23.6% in Eastern Europe, the Mideast and Africa; 17.3% in Europe; 14.9% in Latin America and Canada; and 11.7% in Asia.

Excluding one-time costs, the company said it earned 93 cents per share in the quarter, beating a consensus Wall Street estimate low fee cash advance. The weak dollar added 8 cents per share to the results and tax items added another 8 cents.

Analysts surveyed by Thomson Reuters, who typically exclude one-time costs, expected earnings of 90 cents per share on revenue of $6.57 billion.

The company reiterated that it would earn $3.32 to $3.38 in 2008. It earned $2.79 a share in 2007.

During the quarter, the company completed its acquisition of Canadian cigarette maker Rothmans Inc. 

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Gasoline prices extended their slide, dropping more than 4 cents a gallon and coming within 25 cents of breaching the $3 level, according to a daily survey of credit card swipes releases Sunday.

The average price of unleaded regular fell to $3.247 a gallon nationwide, down 4.4 cents from $3.291, according to the Daily Fuel Gauge Report issued by motorist group AAA. That brings the two-day total decline to 10.3 cents.

The decline comes as hurricane season winds down and oil prices drop because demand is likely to weaken as the economy slows.

Gas prices dropped a record amount in the last two weeks, falling by more than 35 cents a gallon, the publisher of a separate survey said Sunday.

Trilby Lundberg, publisher of the nationwide Lundberg Survey of gasoline prices, said the average price for self-serve unleaded across the United States dropped to $3.31 a gallon - the largest decline in the six-decade history of the survey.

"This could be one the largest drops in history," Lundberg said.

Lundberg’s survey looks at about 5,000 gas stations around the nation, tallying an average gas price for regular-grade unleaded gasoline.

Before the latest survey, the record drop tallied by surveyors came after Hurricane Katrina in October 2005, when national gas prices dropped 25 cents a gallon, Lundberg said.

The price has now tumbled nearly 87 cents, or 21%, below the record $4 cheap payday advance.114 set July 17. And it’s down about 43 cents from a month ago, but still remains some 49 cents, or 19%, higher from a year ago.

The average price has dropped below $3 a gallon in six states: Iowa, Kansas, Minnesota, Missouri, Ohio and Oklahoma, where gas was selling for $2.83 a gallon, on average.

Gasoline is highest in Alaska, at $4.133 a gallon, with Hawaii - at $4.079 - the only other state above $4 a gallon.

Gasoline prices had surged during the highly traveled summer season and as a series of hurricanes battered oil refineries in the Gulf of Mexico. But with hurricane season nearly over, prices began their slide.

Oil prices also have been moving sharply lower amid fears that the economic crisis, which has deepened globally, will have a severely adverse effect on demand.

Crude plunged to a 13-month low on Friday, ending down $8.89 to $77.49 a barrel. That’s a far cry from the $147.27 a barrel seen in July.

And since oil prices make up about half of the price of gasoline, the slide in crude S good news for drivers.

The survey is conducted for AAA by Oil Price Information Service from credit card swipes at more than 85,000 service stations nationwide.  

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The global economic crisis claimed its first Japanese financial institution on Friday and the government looked to prop up smaller banks, as Tokyo shares flirted with their biggest one-day fall since the 1987 market crash.

Escalating bankruptcies in the property sector and among small businesses, along with fears of a global recession, have dragged Japan’s export-dependent economy into the crisis, sending blue chip shares sliding by a quarter so far this week.

“This is panic. New York, the currencies — there’s nothing left for us to trust,” said Takashi Ushio, head of investment strategy at Marusan Securities, as the Nikkei share average slid more than 10 percent, following sharp falls on Wall Steet.

“Investors are scurrying to convert to cash. A lack of confidence is coupling with panic.”

As unlisted Yamato Life Insurance Co failed, the government said that to help hard-hit smaller lenders it may revive a bank rescue law from the 1990s Japanese banking crisis (no fax instant cash advance). One newspaper report suggested Tokyo may set up a $100 billion fund.

Fearful selling also sent Hong Kong and South Korean shares down 7 percent while Singapore declared its first recession in six years as the U.S. stock plunge heaped pressure on economic powers to halt a global spiral of financial distress and slowing growth.

Financial policy makers from the Group of Seven major industrial nations, including Japan, are to meet in Washington later on Friday to consider what to do next, as bank bailouts, liquidity injections and interest rate cuts across the world have failed to quell investor anxiety.

After arguing for months that Japan had avoided the worst of the global financial crisis, its leaders acknowledged they were increasingly worried about the stock falls. 

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