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I am concerned about war with Russia. Should I be making my clients more conservative?

The situation in Russia is serious but falls into the category we call global risks. Unfortunately, there will always be global risks on the economic horizon and investors cannot wait until the dust settles to get into the market, otherwise they will be waiting forever. We recommend that investors keep their eye on the fundamental driver of the markets - corporate profits as a guide to the market's direction. Right now corporate earnings are at all-time highs and fourth quarter earnings growth was 8.5% higher than last year. So for now there is no immediate market concern regarding Russia.

Are gold and silver prices going to continue to increase?

The trend on gold and silver are negative. The metals climbed on the fears of Fed tapering and the commensurate hit to selected emerging market currency and stock markets. Gold in particular has been a fear trade, alternate reserve currency and a hedge against inflation and deflation. In other words the expectations are unreasonably high and I expect that it will continue to lose its luster until it gets to a more sustainable level. Our forecast for gold in 2014 is $999.

In past decades, when the US economy was growing, in how many of those years was the S&P 500 Index up, and in how many was it down? In other words, what is the probability that the stock market will be up in 2014?

The market is driven by fundamentals – namely corporate earnings. Yes it is great to have a favorable economic backdrop for companies to make money but U.S. companies have shown they can increase profits even in a slow growth economy. Earnings in 2013 reached the highest level ever despite economic growth of about 2.5%. Based on the current earnings season and the projections for earnings in 2014 I would say the chances of the market going up a pretty good.