A version of this letter was originally sent on July 24, 2011

Dear Clients,

I am sure that you have been following with concern the political drama unfolding in Washington around the issue of raising our nation’s debt ceiling. At this moment, it is not clear what the final resolution of this issue will be and it appears that negotiations have hit an impasse. The markets will start to vote shortly in Asia when exchanges open on their Monday. Our market will certainly react as well to these events and will continue to remain volatile as long as the impasse continues and we get closer to the August 2 deadline when fiscal debt is expected to exceed revenues.

I am also sure you are wondering how all this will impact your savings and investments. I share these same concerns as a fellow investor (and tax payer) following the same investment strategy that I have recommended for you and investing in the same assets that comprise your respective portfolios. Unfortunately, neither I nor the various pundits in the media possess a crystal ball to allow us to divine what will happen over the course of the next few days and weeks and, more importantly, how financial markets will react in response.

It is exactly this unknowability, however, that informs our investment strategy and policy of diversifying across a broad array of asset classes that tend to react differently to economic conditions. I believe that all of your IPSs reflect a prudent approach to the uncertainly and risk that is an essential element of investing. Your equity assets are invested in domestic and international markets, both developed and emerging, and are comprised of thousands of companies running the gamut of size and valuation. Similarly, your fixed income assets are invested globally, in high quality issues (AAA/AA), with maturities averaging less than 2 years. We have intentionally kept your fixed income asset maturities short as a hedge against inflation and to dampen the overall volatility of your portfolio.

In short, I believe that the work we have done together to prepare you for the risks inherent in the market will also prepare you for whatever may happen as a result of the current debt ceiling crisis. This is not to say that the ride will be an easy one. I do believe, however, that you are well-positioned to see this crisis through and remain on track to achieving your long term goals. As both your advisor and fellow market participant, I will be there with you and for you whatever may arise. I am therefore not recommending any changes to your respective strategies at this time.

As always, I am available to you at any time to discuss this or any issue of concern to you.

Thank you for your continued support and trust.