[ Quarterly Client Update - January 2003 ]   We want to thank you for your continuous commitment to our firm throughout 2002.  Although 2002 was a volatile and uncertain year, the market has finally started to see upward momentum.  Performance improved in the fourth quarter for several reasons, which we will discuss below.  We are quite proud of our recommendations and guidance, which have allowed our clients to successfully navigate this very difficult period in investment history.  The environment for investors has finally started to, once again, pay off.  As always, we will continue to look for ways to add value to our services.  We are confident that the markets will continue to improve, and invite you to discuss your investment management, financial/retirement planning or any other issue during this upcoming year.  We are poised for growth in the economy and stock market in 2003 and feel your patience will be rewarded. Good News On the Horizon - President Bush has announced future tax cuts and an economic stimulus package.  A favorable change on taxation of dividends and capital gains can only jumpstart the market and free up capital for future growth. - It is impressive to see companies with positive earnings growth, in a low inflationary environment. - Since the changes made in August and the recent stringent enforcement of these laws, corporate America is accountable and significantly more responsible than in the previous decade. - Corporations are leaner and meaner after the past three years of limited expansion and business spending.  There is pent-up demand for goods and services.  This was the 11th straight month for growth in the services area.  Factory orders also rose in December.  In short, corporate America is now structured to improve its bottom line. - After the events of the last three years, earning estimates and forecasts have become more realistic by companies and shareholders.  The data that is published is more conservative and accurate.  This will result in stock prices, which are more stable, and data that is more reliable.  In short, investors will probably be rewarded with better, not worse, numbers than are forecasted. Why are we so optimistic at this point in time?   We know that markets overreact to both positive and negative news.  There is an “irrational exuberance” factor in both directions.  When all negative news has passed, so has the opportunity to buy good stocks at good values.  Waiting for the “all-clear” sign means missing a substantial move upward.  We also know that with money markets ($3 trillion) at 1% interest rates and no plans by the Federal Reserve to move those 30-year low rates upward, the cash should start shifting back toward equities shortly.   Recent Changes: We saw a solid recovery from mid October thru December.  It has been encouraging to see strong economic fundamentals finally being translated into stock market performance.  These figures were ignored due to the market fixation on non-economic data (scandal and war).  While we remain cautious, the cornerstone of our beliefs is that stock prices will eventually follow earnings growth.   Our research efforts have continued to focus on evaluating growth stock funds.  On the fund specific level, we have increased our exposure to Small Cap Growth Stocks.  This entailed adding to existing positions, and in some portfolios introducing Independence Small Cap fund.  To accommodate these buys, we trimmed our Small Cap Value exposure through sales in One Group Small Cap Value and Armada Small Cap Value.  We have also recently added another Mid Cap Growth fund to our mix that will be utilized in our next reallocation. Variable annuities posted double-digit gains since the lows of October. The limited growth-oriented choices that hurt performance in the first three quarters were responsible for the upside in the final quarter.  We have completed research on an additional Variable Annuity product US Allianz Charter.  Furthermore, we anticipate variable annuity portfolio adjustments will be recommended two to three times per year.  News at Singer Xenos Wealth Management Shortly, you will receive our annual client survey.  Please take the time to complete it.  It helps us chart our course for the New Year. Our Client Appreciation Gala is scheduled for Thursday, February 6th.  Invitations will reach you shortly.  We look forward to seeing you there. Marc Singer has been lobbying for physicians around the state of Florida with numerous speaking engagements regarding the medical malpractice crisis.  If you have issues about asset protection, we are available to review your situation in-depth. We want to wish everyone a wonderful 2003 and look forward to meeting with you personally.