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The NationalDebt
The Housing Slump
NationalizedHealthcare
Lack of Trust in Wall Street
Media’s Focus on Bad News
Environmental Concerns
Unemployment
1975:Highest UnemploymentSince the Great Depression
Unemployment—or the fear of it—has
become a gnawing preoccupation…
millions of Americans would argue that
the most severe slump since the 1930s
has indeed become worse than a
recession…[The jobless toll] will stay
high for the foreseeable future, even
long after the economy turns up.
“
”TIME magazine, March 17, 1975
INNOVATION: Invention of the microprocessor, floppy
disks, and gene splicing
ECONOMY: Inflation dropped from more than 12% in
1974 to less than 5% by the end of 1976 Unemployment dropped from 8.5% in 1975
to 5.8% in 1979
PAST ECONOMIC AND INDEX PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS. Assumes reinvestment of income and no transaction costs or taxes. This data is for illustrative purposes only and not indicative of any investment. The S&P 500 Index is an unmanaged list of 500 widely held U.S. common stocks frequently used as a measure of U.S. stock market performance. Cash is represented by 30-day U.S. Treasury Bills. Indices are unmanaged, are not available for direct investment, and do not represent the performance of any of The Hartford’s products or any particular investment.
Data source: Thomson Reuters, 8/10.
1983:Foreign Debt Will Sink the Global Economy
PAST ECONOMIC AND INDEX PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS. Assumes reinvestment of income and no transaction costs or taxes. This data is for illustrative purposes only and not indicative of any investment. The S&P 500 Index is an unmanaged list of 500 widely held U.S. common stocks frequently used as a measure of U.S. stock market performance. Cash is represented by 30-day U.S. Treasury Bills. Indices are unmanaged, are not available for direct investment, and do not represent the performance of any of The Hartford’s products or any particular investment.
The global economy is sitting on a
debt bomb. The risks, according to
U.S. Federal Reserve Chairman Paul
Volcker, are ‘without precedent in
the postwar world.’ Says British
Financier Lord Lever: ‘The banking
system of the Western world
is now dangerously overexposed.
“
”TIME magazine, January 10, 1983
ECONOMY: U.S. economy entered a period of unusually
strong growth, averaging 5.2% growth from
1983 to 1986 Concerns about high levels of foreign debt
moved to the sidelines Large American companies began to sell
more products and services overseas
Data source: Thomson Reuters, 8/10.
INNOVATION: Personal computers, the Windows
operating system, and digital cell phones
First artificial heart transplant
Data source: Thomson Reuters, 8/10.
1984:
High GovernmentSpending Leads to Record Budget Deficits
PAST ECONOMIC AND INDEX PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS. Assumes reinvestment of income and no transaction costs or taxes. This data is for illustrative purposes only and not indicative of any investment. The S&P 500 Index is an unmanaged list of 500 widely held U.S. common stocks frequently used as a measure of U.S. stock market performance. Cash is represented by 30-day U.S. Treasury Bills. Indices are unmanaged, are not available for direct investment, and do not represent the performance of any of The Hartford’s products or any particular investment.
If Congress and the White House
insist on avoiding...the difficult
measures needed to control the
deficit, the chance to keep the
recovery going and assure the future
health of the U.S. economy may slip
irretrievably away.
“
”TIME magazine, March 5, 1984
1992:No Recovery
in Sight
In a normal rebound, Americans
would be witnessing a flurry of
hiring, new investment and
lending, and buoyant growth. But
the U.S. economy remains
comatose a full year and a half
after the recession ended.
“
”TIME magazine, September 28, 1992
INNOVATION; Internet introduced to general public Technology boom created millions
of jobs, greatly increasing productivity
ECONOMY: Low inflation, low interest rates, and
moderate-to-strong growth led to “Goldilocks”
economy
PAST ECONOMIC AND INDEX PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS. Assumes reinvestment of income and no transaction costs or taxes. This data is for illustrative purposes only and not indicative of any investment. The S&P 500 Index is an unmanaged list of 500 widely held U.S. common stocks frequently used as a measure of U.S. stock market performance. Cash is represented by 30-day U.S. Treasury Bills. Indices are unmanaged, are not available for direct investment, and do not represent the performance of any of The Hartford’s products or any particular investment.
Data source: Thomson Reuters, 8/10.
Emerging Markets: Emerging Wealth
Middle-class consumers span
a dozen emerging nations, and
they include almost 2 billion
people who spend a total of
$6.9 trillion annually1
Companies in the S&P 500
Index reported that 46.6% of
their sales came from overseas2
Technology for a Greener and Wireless World
U.S. auto makers challenged to sell one million plug-in hybrids, and proposed tax concession for those who buy them3
Shift to “cloud computing,” is becoming more popular4
By 2030, developing nations will own more than 90% of all mobile phones worldwide5
PAST ECONOMIC AND INDEX PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS. The S&P 500 Index is an unmanaged list of 500 widely held U.S. common stocks frequently used as a measure of U.S. stock market performance. It does not represent the performance of a specific fund and is not available for direct investment.
1 “Capturing The World’s Emerging Middle Class,” McKinsey Quarterly, July 22, 2010.2 Standard & Poor’s Research & Design Report, August 2010.
3 “Crisis Bodes Well For Electric Cars,” Forbes, February 10, 2009.4 “Cloud Computing’s Great Promise,” Forbes, June 30, 2010.5 “The Scary New Rich,” Newsweek, March 6, 2010.
Expect the Unexpected
Over the next 10 years, new
products and innovations will
surprise and delight us.
We can’t know in advance what
they’ll be, but It’s always
something.
By investing in a diversified portfolio,
you can potentially profit from the
growth new trends may bring.
Healthcare: Increased Innovation and Demand
Dr. Leroy Hood, who played key role
in decoding the human genome, is
working to make “P4 medicine”—
personalized, predictive, preventive,
and participatory—a reality.1
The average American spends
$7,000 per year on healthcare, while
the average person in China spends
just $150, leaving room for growth in
healthcare spending.2
1 “A Vision for Personalized Medicine,” TechnologyReview.com, March 9, 2010.2 “US Reform and the Investment Case for Health Care,” Wellington Management white paper, May 2010.
INDEX PAST PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS. Assumes reinvestment of income and no transaction costs or taxes. This data is for illustrative purposes only and not indicative of any investment. Indices are unmanaged, are not available for direct investment, and do not represent the performance of any of The Hartford’s products or any particular investment. The Dow Jones Industrial Average (DJIA) is an unmanaged price weighed index of 30 of the largest, most widely held stocks traded on the NYSE. Data Source: Ned Davis Research, 2/12.
Perspective 1:After Periods of Decline, the Market Has Always Recovered
Dow Jones Rolling 10-Year Average Annual Returns (12/31/1910–12/31/2011)
What’s Next?Although the future is uncertain, based on this graph, would you rather invest when the market has already had a strong 10-year run, or after the market has had a dismal decade?
What’s Next?Although the future is uncertain, based on this graph, would you rather invest when the market has already had a strong 10-year run, or after the market has had a dismal decade?
INDEX PAST PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS. Indices are unmanaged, are not available for direct investment, and do not represent the performance of any of The Hartford’s products or any particular investment.Data Source: Morningstar, Inc., 2/12.
Perspective 2:Diversify Globally to Capture Global Opportunities
Major Equity Indices From Several Countries and Regions Calendar-Year Total Returns (2006-2011)
1 Brazil is represented by the MSCI Brazil USD Index, a free-float adjusted market-capitalization index that is designed to measure the equity performance of the Brazilian market.2 The European Union is represented by the MSCI Europe Index, a free float-adjusted market capitalization weighted index designed to measure the equity market performance of the developed markets in Europe: Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, the Netherlands, Norway, Portugal, Spain, Sweden, Switzerland, and the United Kingdom.3 Japan is represented by the MSCI Japan Index, a free float adjusted market capitalization index designed to measure large and mid cap Japanese equity market performance.4 United States is represented by the S&P 500 Index, which is a composite of the 500 largest companies in the United States.5 Russian Federation is represented by the MSCI Russia USD Index, a free-float adjusted market-capitalization index that is designed to measure the equity performance of the Russian market.6 China is represented by the MSCI China USD Index, a free-float adjusted market-capitalization index that is designed to measure equity market performance in China.
Perspective 3:Remember, Innovation Can Drive Markets
Growth of $1 Invested (12/31/81–12/31/11)
12/31/1981 1985 1990 1995 2000 2005 2011
$26
$23
$18
$13
$23
$22
$4
$2$4
Hypothetical value of $1 invested at year-end 1981Assumes reinvestment of income and no transaction costs or taxes. This data is for illustrative purposes only and not indicative of any investment.PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS. BECAUSE OF ONGOING MARKET VOLATILITY, PERFORMANCE MAY BE SUBJECT TO SUBSTANTIAL CHANGES.Government bonds and Treasury bills are guaranteed by the full faith and credit of the U.S. government as to the timely payment of principal and interest, while stocks are not guaranteed and have been more volatile than the other asset classes. Furthermore, small stocks are more volatile than large stocks, are subject to significant price fluctuations and business risks, and are thinly traded. Small stocks are represented by the fifth capitalization quintile of stocks on the NYSE for 1926–1981 and the performance of the Dimensional Fund Advisors, Inc. (DFA) U.S. Micro Cap Portfolio thereafter. Large stocks are represented by the Standard & Poor’s 500®, which is an unmanaged group of securities and considered to be representative of the stock market in general. Government bonds are represented by the 20-year U.S. government bond, Treasury bills by the 30-day U.S. Treasury bill, and inflation by the Consumer Price Index. The Consumer Price Index (CPI) is the most common measure of inflation for urban consumers; it records the increase in the rate of inflation by relating the cost of a basket of goods and services today to a base period.Gold is represented by the S&P GSCI Gold Index, a sub-index of the S&P GSCI, which tracks the COMEX gold future.Indices are unmanaged and unavailable for direct investment. Data Source: Morningstar, 1/12. Sources for Inventions: About.com and ThePeopleHistory.com, 9/10.
After Periods of Decline, the Market Has Always Recovered
Diversify Globally to Capture Global Opportunities
Remember, Innovation Can Drive Markets
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This information is written in connection with the promotion or marketing of the matter(s) addressed in this material. The information cannot be used or relied upon for the purpose of avoiding IRS penalties. These materials are not intended to provide tax, accounting or legal advice. As with all matters of a tax or legal nature, you should consult your own tax or legal counsel for advice.
“The Hartford” is the Hartford Financial Services Group, Inc. and its subsidiaries, including the issuing companies of Hartford Life Insurance Company and Hartford Life and Annuity Insurance Company.
All information and representations herein are as of 12/11 unless otherwise noted.
This seminar has been funded in whole or in part by Hartford Life Distributors, LLC, a broker dealer affiliate of The Hartford.
SEM_IAS 102089 2/12