“Housing has been a big source of disappointment lately, and since the pending home sales number wasn’t bad, it has enabled yesterday’s rally to follow through,” said Gary Flam, portfolio manager of Bel Air Investment Advisors in Los Angeles.

“We’re waiting it out,” said Kenneth Naehu, a managing director at Bel Air Investment Advisors in Los Angeles. He manages almost $3 billion in municipal bonds.

The manufacturing report “gives some comfort, but that is only good until the next number,” said Darell Krasnoff, managing director at Bel Air Investment Advisors.

Andrew Palmer, managing director, was ranked in Barron’s “Top 100 Independent Financial Advisors” for 2010.

“The market is pretty strong for well-rated essential service-type issues,” said Kenneth Naehu, managing director and fixed-income portfolio manager at Bel Air Investment Advisors LLC in Los Angeles. “The simple story is that essential-service credits and well-rated bonds are going to be moved at very attractive levels for the issuer.”

“Given the concern of what’s going on in the economy and the potential for a double-dip, I’m looking for more substance to come out of the executive and legislative branches of government and not necessarily out of the Fed,” says Gary Flam, portfolio manager at Bel Air Investment Advisors in Los Angeles.

“From a very broad perspective, we got through earnings season after the first quarter at the end of April, and the market had a sharp correction from late April to late May, and we’re right where we were at the end of May,” said Gary Flam, portfolio manager at Bel Air Investment Advisors.

“Pretty much across the board, companies that reported earlier said they weren’t seeing a slowdown impact their businesses, that Europe wasn’t impacting us and the U.S. seems to be growing,” said Bel Air Investment Advisors portfolio manager Gary Flam.

“Bears have the upper hand today because claims were so much worse than expected,” said Gary Flam, a portfolio manager at Bel Air Investment Advisors in Los Angeles.

“Cisco is one of the first companies that has July in their results and they were talking about seeing economic uncertainty and the slowdown affecting their business,” said Gary Flam, portfolio manager at Bel Air Investment Advisors.

Investors are looking ahead to the government’s unemployment report due on Friday, said Kenneth Naehu, head of fixed income at Bel Air Investment Advisors. Traders will be gearing up all week for its headline jobs number, which is considered one of the most important gauges of the economic recovery, he said.

Others, like Ken Naehu of Bel Air Investment Advisors, are taking the opportunity to clear out lower-quality bonds in favor of higher-quality issues. “We’re selling everything you won’t be able to sell in the near future” should the bond market suddenly turn on investors, he said.

“There aren’t many people jumping in the stock market — they’re nervous,” said Todd Morgan, senior managing director at Los Angeles-based Bel Air Investment Advisors, which has 260 clients, with minimum portfolios of $20 million. “But that’s usually the best time to buy.”

“I think [this week is] really going to be a continuation of a trend of reassurances from companies that the economy, both here in the U.S and globally, continues to grow and that we’re not heading for a double-dip,” said Gary Flam, portfolio manager at Bel Air Investment Advisors.

California’s general obligation bonds are selling briskly despite being rated just a few notches above “junk” status, said Craig Brothers, of Bel Air Investment Advisors. “There is still a lot of demand out there,” Brothers said. However, he added that he will wait to order more California debt. His Los Angeles firm oversees $2.7 billion in fixed-income assets, including $2 billion in municipal bonds.

“At the end of the day, you saw a big snapback in the market over the last week or so off the lows without much justification behind it,” said Gary Flam, portfolio manager for Bel air Investment Advisors. “But the reality is we just received more data that called the sustainability of this economic recovery into question.”

In a recent survey, 91% of wealth management advisory firm Bel Air Investment Advisors’ high net worth clients said they were concerned with wealth transfer.

“The fact that you have certainly, and not necessarily a friendly bill but a bill that you now know exactly what’s in it and what it constitutes, that certainly is being received well in today’s market,” said Gary Flam, portfolio manager of Bel Air Investment Advisors.

“When a client comes in, we have a long dialogue about their history, their sleep-well quotient, income needs, estate planning,” said Todd Morgan, senior managing director of Bel Air Investment Advisors in Century City, Calif.

“The Fed announcement yesterday gave the bias that the economy is not improving,” said Naehu. “So now we still have a flight to quality trade, and [the bond market] is of course the least scary place to invest.”

“For the most part, the vast majority of our clients give us full discretion and with that disrection comes the simple mandate: maximize the yield with minimal risk,” said Naehu, who has headed Bel Air’s bond division since leaving Bear Stearns’ West Coast municipal bond department in 1998.

Gary Flam, managing director and portfolio manager at Bel Air Investment Advisors in Los Angeles, knows customers are still skittish about stocks. But he successfully rode one kind of stock- high-dividend payers- through the downturn, and today, he’s still buying. Flam considers a dividend, a share of a company’s earnings passed along to stockholders, to be a sign of reassurance. And if a stock’s price dips, he adds, “a dividend tends to cushion the blow.”

The next 12 months will see higher prices for residential real estate, in the eyes of 87 percent of the well-heeled who were at Bel Air Investment Advisors’ Next Generation Conference in California.

“Our view is that it’s not going to be the normal reinvestment season,” Brothers said. “There are other things that are bigger.”

But not all companies fit the mold neatly, says Gary Flam, a portfolio manager at Bel Air Investment Advisors. He says Bel Air sometimes seeks hints about a company’s overseas businesses by studying which currency risks end up getting disclosed in regulatory filings. For instance, CSX Corp. (CSX), with rail network in the Eastern half of the U.S., might be far less exposed to Europe’s struggles than airlines it is often grouped with.

“The market’s just looking for an affirmation that the economy here is still growing. That’s the biggest concern,” says Gary Flam, portfolio manager at Bel Air Investment Advisors in Los Angeles. “If the economy continues to grow and this is just a normal correction, the market will continue to grow. But if Europe drags down our economy, some more dour outcomes can be envisioned.”

Another bad thing for parents to do is always to solve their children’s problems. Todd M. Morgan, senior managing director at Bel Air Investment Advisors, a Los Angeles-based company that manages $5 billion, said the tendency among successful executives was to step into their children’s lives and fix things as they would in a boardroom. “Do not offer to fix or change something unless you’ve been invited to do it,” he said.

One potential investory, Los Angeles-based Bel Air Investment Advisors research manager Arun Bharath, knows that his $6 billion under management needs more exposure to emerging markets. “I’m hoping to get some ideas on how,” he says.

Kenneth Naehu, managing director and head of fixed-income at Bel Air Investment Advisors, said he expects the market’s swings to continue as long as any uncertainty remains. “One thing you should expect is volatility going forward,” said Naehu. “People have their hands on the trigger so to speak, whether they are buying or selling.”

“If you look at the Chinese market, technically it’s broken down,” Flam said. “China has slowed down. Now, their policy was to try to slow the rapid growth there, but I think a lot of people are getting spooked because the growth has slowed a little bit more than many anticipated.”

Kenneth Naehu, senior portfolio manager and fixed-income strategy head at Bel Air Investment Advisors LLC in Los Angeles, said spreads widened markedly the last time the state saw a lot of headline risk, in 2009, when lawmakers twice spent weeks arguing over budget solutions with the state facing tight liquidity.

“This is a market dominated by retail buys now,” he said. “Individual investors are very headline-sensitive. Quite frankly, individual investors often have little else to go on.”

Naehu said he tells clients that among the many financial problems facing cities and states, headline risks are the biggest cause of volatility. Headline risk also offers opportunities, he added.

“We were large buyers of California debt when spreads were wider. We haven’t been now that they’ve tightened,” Naehu said, adding that he expects spreads to widen.

“California debt is different from Greek debt,” said Kenneth Naehu, a managing director at Bel Air Investment Advisors in Los Angeles. “Our debt service is so small a part of our budget that is minuscule, and it gets a top priority. For California, restructuring debt is not possible, but for Greece it maybe the best thing.”

Others, like Gary Flam, equity portfolio manager for Bel Air Investment Advisors in Los Angeles, are also optimistic, but think the market has entered a new, more cautious place. He said he expects to see the rally continue with the Dow climbing back to roughly 12,00 from its current level around 10,400. But he thinks the “junk, high beta” market — one from which favors weaker, more volatile stocks — will give way to one that favors companies with strong balance sheets.

“The bond market reversal is showing fear in the system, but I don’t know you can definitely draw anything from it,” said Kenneth Naehu, head of fixed income at Bel Air Investment Advisors, when prices were down at the market’s open.

“It’s like somebody pressed a reset button on the market,” said Gary Flam, portfolio manager at Bel Air Investment Advisors in Los Angeles. “So we’re looking for an opportunity to add some positions and to establish new positions.”

A new study from Los Angeles-based Bel Air Investment Advisors, surveying wealthy kids and families attending a “next generation” seminar, shows that families are well aware of the the pitfalls of inherited wealth –- yet they keep on passing it down.

More than half of wealthy people are worried that their net worth will shrink, according to a new survey by Bel Air Investment Advisors.

“It was a good entry point on cash we’ve been sitting on for a long time,” Morgan said. Bel Air oversees $4.5 billion for clients, who average $17 million in investable assets.

Nearly Two Out of Three High Net Worth Inheritors Are “Very
Concerned” About Growing Wealth, According to Survey Conducted at Bel Air’s Next Generation Conference

LOS ANGELES – May 5, 2010 – Bel Air Investment Advisors LLC (www.belair-llc.com), a leading independent wealth management advisory firm to high net-worth individuals, families, trusts and foundations, released today key findings from a survey conducted at a Next Generation wealth conference.

These are the results of a wealth survey done by Bel Air Investment Advisors LLC, which polled 80 of its very high net worth clients at a conference in Indian Wells.

Gary Flam, portfolio manager of Bel Air Investment Advisors, said fears are ramping up that the euro-zone debt crisis might grow bigger and have broader economic implications than originally thought. Worries of a contagion effect are on the rise. “Greece is seen as the tipping of the first domino, to be followed by Portugal and Spain,” he said.

News of a bailout for Greece may be pushing Treasury prices down Monday, but a one-day slip is not enough to indicate investors are completely convinced the bailout will work, said Kenneth Naehu, managing director and head of fixed income at Bel Air Investment Advisors. “The market is not sold on that there’s a solution for Greece. Until we see a significant rally in Greek bonds, it’s hard to believe the market will have any conviction that Greece has turned the corner,” he said

“It’s what we’ve seen over the last few weeks. There’s this underlying strength in the market,” said Flam. “But I think the second takeaway, given the news out of Greece, is these things are in the headline and are being discounted.”

“If you’re hoping for a pullback to get in at lower levels, then you’re doing exactly that, you’re hoping,” says Gary Glam, portfolio manager at Bel Air Investment Advisors in Los Angeles. “When you invest based on hope it usually doesn’t go well.”

Until then, Treasurys will likely remain in a narrow range, said Kenneth, Naehu, managing director and head of fixed income at Bel Air Investment Advisors.

“Though he’s keeping a watchful eye on slowing momentum in the market, Gary Flam, portfolio manager at Bel Air Investment Advisors, said today’s retail sales figures buoyed stock moves higher despite early session headwinds ranging from Greece’s debt hardships to downbeat jobs data.”

“‘[Same-store sales] were strong across the board. There was some concern that some of this might have been priced in, but they came in even stronger than most were expecting, which is why you’re seeing the strong pick-up,’ he said. ‘The market continues to have tremendous resilience.’”

“‘People seem to be getting a little more faith that you will see economic activity continue in the second half and not fall off a cliff…But the problem for the market may be that the gains will get harder to come by.’”

“‘People seem to be getting a little more faith that you will see economic activity continue in the second half and not fall off a cliff…But the problem for the market may be that the gains will get harder to come by.’”

“‘We think 2010 is going to be about being more opportunistic about positions—not just buying things when they’re down but also selling stocks when they’re richly valued…It’s going to be more about moderating our positions to make sure we have more attractive risk ratios going forward in all our positions.’”

“‘Municipal markets, where not-for-profit hospitals borrow for construction and technology, were unfazed by headlines that declared the health reform law historic in reach…’”

“Gary Flam, portfolio manager at Bel Air Investment Advisors, said to look for traders to ratchet down their exposure as the week goes on.”

Institutional investors are keeping an eye on California’s fiscal woes, but do not doubt its commitment to paying bondholders, a top priority backed by state law, said Ken Naehu, head of fixed-income at Bel Air Investment Advisors in Los Angeles.

“They care more about the state’s ability to make debt-service payments, which is extremely strong,” Naehu said.

Treasury prices may have been little changed by the auction, but fell on the long end because of major stock market gains, said Ken Naehu, managing director and head of fixed income at Bel Air Investment Advisors.

A year ago, “we could have talked blue in the face about the once-in-a-lifetime opportunities” in stocks, but clients “wouldn’t even pick up the phone,” says Gary Flam, equities portfolio manager at Bel Air Investment Advisors in Los Angeles. Now, he says clients “are more open to it, they’re proactively contacting us asking if it’s time to get in.”

Treausry markets are looking a bit lackluster as they have been all week, said Ken Naeuhu, managing director and head of fixed income at Bel Air Investment Advisors. Trading volume is low and looks to remain that way until any major economic news hits headlines, he said.

“The verbiage they’ll pay attention to is whether Fed Chairman Ben Bernanke will allude to any policy changes, especially when it comes to timing for a potential hike in interest rates, said Kenneth Naehu, managing director and head of fixed income for Bel Air Investment Advisors.”

“In the meantime, investors are likely to have a ‘wait and see attitude,’ he said”

“’It’s an ideal time for the state to put a deal in the marketplace,’ said Kenneth Naehu, who oversees $2.5 billion in fixed-income investments for Bel Air Investment Advisors in Los Angeles.”

“‘The state couldn’t have found a better time to bring a deal’”

“Ken Naehu, managing director and head of fixed income at Bel Air Investment Advisors in Los Angeles, said investors are increasingly separating ‘headline risk’ to California debt from the state’s ability and mandate to pay bondholders.

“‘I’ve made it a sort of point to make,’ Naehu said.”

“Investors will keep a close eye on demand from foreign bidders this week… The big question is to what extent will they continue to buy U.S. debt in the auctions…”

“State Treasurer Bill Lockyer will also benefit from the deal’s timing, said Craig Brothers, managing director at Bel Air Investment Advisors in Los Angeles. ‘The market is think,’ Brothers said, ‘Nobody is saying they’ve done a lot of buying in 2010.’”

“‘It clearly makes people question the validity of the data…If you’re in the hospital for one reason and you get sick with something else, it’s not good. As this economy is limping toward recovery, any setback if it’s weather or something else is clearly going to have an outsized effect.’”

Darell Krasnoff, managing director at Bel Air Investment Advisors in Los Angeles, said the rebound after the slide in January and early February is a sign that the market needed a break before it could proceed. Still, he said that investors feel burned by the slide in 2008 and early 2009 and have concerns about the economy.

“There is still tremendous anxiety about the state of the global economy,” he said. “It doesn’t take much to rekindle the animal spirits of the bear market.”

Los Angeles-based Wealth Management Firm Revamps Its Web Site to Reflect Current Brand Image, Strengthen Search Engine Optimization (SEO), and Simplify Navigation

LOS ANGELES – March 1, 2010 – Bel Air Investment Advisors LLC (Bel Air), a leading independent wealth management advisory firm to high net-worth individuals, families, trusts and foundations, launched its newly updated and redesigned Web site today.

“Investors still nursing wounds from the subprime-mortgage crisis fear the Greek sovereign- debt issues could be the start of a broader unraveling across the euro zone, said Gary Flam, portfolio manager at Bel Air Investment Advisors. ‘There’s a lot of reassurance being talked about, but the reality is a lot of investors are looking at this as the tip of the iceberg,’ Mr. Flam said.”

“Investors still nursing wounds from the sub-prime mortgage crisis are suspicious the Greek sovereign debt issues could be only the start of a broader unraveling across the euro zone, said Gary Flam, portfolio manager at Bel Air Investment Advisors.”

“‘There’s a lot of reassurance being talked about, but the reality is a lot of investors are looking at this as the tip of the iceberg,’ Flam said. “

“Investors are sill concerned today that bidders dropped dramatically,” said Kenneth Naehu, managing director and head of fixed income at Bel Air Investment Advisors. “We’ve been issuing this record debt, and the market is jumpy on any sign of saturation.”

“Greece’s issues will get addressed, but I wouldn’t be surprised to see a bigger market pullback in the weeks ahead anyway,” said Tim McCandless, senior equity analyst at Bel Air Investment Advisors.

“’We had one of our best years for new assets in 2009, and we’re hiring new people this year,’ said Todd Morgan, senior managing director, Bel Air Investment Advisors, which has approximately $20 billion in assets under management. ‘I think California is still one of the best kept secrets in the business. It’s a great place to live and a great place to do business. Don’t count California out.’”

“’This is a political mess,’ said Naehu. ‘The state is not out of the woods. In fact, one could argue they are in even worse shape than they were before.’”

“Expectations have been rising for the market overall,” says Gary Flam, portfolio manager for Bel Air Investment Advisors in Los Angeles. “It seems like over the last month the definition of risk changed from losing money to missing the next move higher. You saw a shift from a fear to greed. All the news of the last week did was highlight there is still uncertainty out there.”

“‘Materials took a big hit last week directly related to China…Cooler heads are prevailing this morning. China’s not going to all of a sudden go into a recession. The question is how fast is China going to grow, not will they grow.’”

“A little bit of a pullback gives people an opportunity [to buy],” said Gary Flam, portfolio manager at Bel Air Investment Advisors. “None of the news from last week I saw as derailing to the economy or markets,” he said.

“I don’t see with this volatility how as a foregin investor you can’t help but step back and look at the United States as an investment with some skepticism,” said Kenneth Naehu, a managing director and head of the fixed income at Bel Air Investment Advisors in Los Angeles, which has $5.5 billion under management.

“’This is probably the beginning of a lot of negative press the state is going to get,’ said Kenneth Naehu, who invests $2.5 billion in municipal bonds for Bel Air Investment Advisors in Los Angeles and sold California bonds last year in anticipation prices would slide. ‘Fear will persist in the marketplace again.’”

“’I believe the state is in worse shape than it was last year…Tax receipts are lower, revenues are lower. There will be another round of ‘the state is in trouble’ headlines.’”

The trigger-happy-investor theory also makes sense to Gary Flam, managing director with Bel Air Investment Advisors LLC, which has $5 billion in assets. “Any scares we get now will remind investors of what happened in 2008, and I think we’ll see some pretty volatile markets in 2010,” he said.

“‘The key to 2010 is to expect volatility, and anyone not prepared for that is going to be rudely awakened…There is so much hinging on such little information. We all know the government wants to pull back the stimulus, but no one knows what it’s going to look like when the government isn’t supporting the markets.’”

“It seems like every time they announce an auction, it’s a huge amount of issuance,” said Managing Director and head of Fixed Income Kenneth Naehu, at Bel Air Investment Advisors. “The question is whether the market can continue its willingness to support all this supply.”

“At $1,000, it would still be more expensive than the average home computer, but that’s the price point below which personalized medicine is considered far more economically viable. The lower the cost of genomic sequencing, the greater the shift analysts expect to see in the allocation of research funds toward the consumer market.”

The lower the cost of genomic sequencing, the greater the shift analysts expect to see in the allocation of research funds toward the consumer market, says Timothy McCandless, an analyst at Bel Air Investment Advisors in Los Angeles.

“Gary Flam, a portfolio manager with Bel Air Investment Advisors, said he found Monday’s pullback in prices of long-dated Treasury bonds more encouraging than the rally in stocks, which came on light volume as traders took off for the holiday.”

Gary Flam, a portfolio manager with Bel Air Investment Advisors, said he found Monday’s pullback in prices of long-dated Treasury bonds more encouraging than the rally in stocks, which came on light volume as traders took off for the holiday. … “When you see the yield curve steepen like that, it’s traditionally been a pretty good predictor that the economy is going to be strong,” causing lenders to demand higher payments to justify making long-term loans, he said.

“Bel Air Investment Advisors is staying underweight on consumer discretionary names in the separately managed accounts it oversees. The consumer’s return to frugality, while expected to normalize, will remain ‘an entrenched outlook in the future,’ says Gary Flam, who manages $600 million for high-net-worth investors at the Los-Angeles-based firm. ‘Even if they wanted to go back to spending like they did in 2005, they can’t’ without wage gains, which will be nearly impossible with so much slack in the labor market.”

“Wage increases are unlikely, contends Reed Halladay, managing partner at Bel Air Investment Advisors LLC, which manages $5 billion.”

Wealth Management Firm Donates Time and Money as Part of Its Annual Holiday Community Outreach and Year-Round Philanthropic Programming

LOS ANGELES – December 14, 2009 – Bel Air Investment Advisors LLC (Bel Air), an independent wealth management advisory firm for high net-worth individuals, families, trusts and foundations, has kicked off the holiday season as it volunteers time and resources as part of its annual holiday season philanthropic initiatives to a number of LA-based nonprofit organizations.

“‘Unemployment rates will stay stubbornly high relative to the past 25 years and will not drop below 8% for next three to four years…Extended periods of high unemployment will lead to low wage growth, since an excess supply of workers will give employers little reason to raise wages.’”

“Unemployment will stay stubbornly high relative to the past 25 years and will not drop below 8% for the next three to four years,” said Gary Flam, managing director and portfolio manager of equities at Bel Air Investment Advisors. “Extended periods of high unemployment will lead to low wage growth, since an excess supply of workers will give employers little reason to raise wages.”

“You could say maybe Dubai isn’t the rationale behind it, but it’s a shot across the bow,” says Gary Flam, portfolio manager with Bel Air Investment Advisors in Los Angeles.

“Over the last several months, the weakening dollar has definitely led the market higher, but historically a weak dollar isn’t good for stocks over the long term,” said Tim McCandless, senior equity analyst at Bel Air Investment Advisors.

“The economy has not proven it can stand on its own two legs yet and the market is acting very tired,” said Gary Flam, a portfolio manager with Bel Air Investment Advisors. “The leadership names have started to roll over and the stocks that have outperformed lately are the very defensive utilities, staples and telecom. I find it hard to believe that the bull market can make a significant move higher driven by utilities and telecom.”

“It has become a good business strategy,” said Darell Krasnoff, managing director of Bel Air, which last year added a company’s green credentials as one factor in making investment decisions. “It was less philosophical and more pragmatic.”

“The key question at this point is whether new leadership will emerge. Will volume and breadth come to confirm this rally, or are we nearing a near-term peak here?” says Gary Flam, portfolio manager at Bel Air Investment Advisors in Los Angeles.

LADWP is coming to market after a wave of state issuance, but the utility should find strong demand for its higher-quality paper, said Kenneth Naehu, head of fixed-income trading at Bel Air Investment Advisors in Los Angeles. “I don’t think that deal’s going to have a problem,” given the expected sizing of the tax-exempt and BAB series, Naehu said. “The bigger question is whether there’s a saturation point for California bonds.”

“You have Disney, you have a couple of retailers, but it’s a relatively quiet day,” says Gary Flam, portfolio manager at Bel Air Investment Advisors. “The market overall for the last week or two weeks has seemed tired. The market is right up there at highs, but we are seeing rallies on lower volume.”

Ken Naehu, who manages bond investments at Bel Air Investment Advisors in L.A., believes the state’s budget woes are far from over, which Schwarzenegger acknowledged Tuesday. Still, a 4% tax-free yield on a bond maturing in less than four years was too good an opportunity to pass up, he said. “We gave them a large order,” Naehu said.

“The consumer in the U.S. is going to be in retrenchment, or the back-packer mentality for a long time,” said Gary Flam, a portfolio manager with Bel Air Investment Advisors. “Even if they wanted to go back to spending the way they were, they can’t.”

“The overall market really seems fatigued at this point in the rally,” says Gary Flam, portfolio manager at Bel Air Investment Advisors in Los Angeles. “The key question is, is this just a pause because solid earnings were expected and then we take off from here, or has the market petered out and we’re due for a pullback?”

Investors interested in distressed investments can lend money to the business directly or purchase equity, said Darell Krasnoff, managing director of Bel Air Investment Advisors in Los Angeles, who counsels clients with at least $20 million in investable assets.

At Bel Air Investment Advisors in Los Angeles, for instance, ETFs can “complement an active-management strategy where we want to get exposure to a specific idea,” such as gold, says Darell Krasnoff, managing director of the boutique advisory, which runs $4 billion.