Welcome to the MONEYLETTER Hotline for November 14, 2007

We are recommending a cutback in the domestic stock fund allocation for all investors. Venturesome investors should cut their domestic stock fund allocation from 50% to 35%. Moderate investors should cut their allocation from 35% to 25% and Conservative investors should cut back from 45% to 40%. Here are the changes being made to the model portfolios:

MONEYLETTER Venturesome: Sell ½ of Janus Contrarian and ½ of Janus Research. MONEYLETTER Moderate: Sell ½ of Janus Orion and ½ of Janus Contrarian. MONEYLETTER Conservative: Sell 20% of Janus Research. Fidelity Venturesome: Sell all of Fidelity OTC Portfolio and 1/3 of Fidelity Growth Discovery. Fidelity Moderate: Sell ½ of Growth Discovery and 1/3 of Fidelity Independence. Fidelity Conservative: Sell 40% of Growth Discovery. Vanguard Venturesome: Sell all of Vanguard Morgan Growth and sell 30% of Vanguard Growth Equity. Vanguard Moderate: Sell ½ of Growth Equity. Vanguard Conservative: Sell all of Vanguard Mid-Cap Index. Put 70% of the proceeds into Vanguard’s money fund. Invest the rest in Vanguard Midcap Growth.

All of the funds raised are to be invested in money funds. We are making this recommendation because we see an extended period – six months or so – of sluggish growth for the American economy. At the same time we no longer see the Federal Reserve acting forcefully to support the economy during this period. The risks to profits have consequently risen over this period. We are now in a very uncertain period for the domestic economy and corporate profits. Some caution is warranted.

New Fund Ratings – For domestic stock funds, two funds are now rated Buy: Marsico 21st Century and Fidelity Trend. Four funds are now rated Hold: Powershares QQQ, Rainier Small/Midcap Equity, Undiscovered Managers Behavioral Growth, and Oberweis Emerging Growth. Vanguard Morgan Growth is now rated Sell. For international stock funds, SSgA Emerging Markets is now rated Hold.

The Economy – We have not changed our outlook; sluggish growth until mid-year ’08, and a pick-up over the second half of that year. What has changed is our confidence in that outlook. $90 oil has shaken our confidence, and the freefalling dollar has done so as well. Retail sales were weak in October, as expected. Recession forecasts for next year are becoming common. The outlook is not sunny, but the deep gloom is overdone. Global growth continues. We need lower oil prices. We look for a sluggish but positive domestic economy.

The Stock Market – We see Tuesday’s huge rally as being powered by a large element of short covering. This is an options expiration week, and some of the market’s gyrations will be purely technical. Next week will give us a better handle on the market. We look for a flat, choppy market.

The Bond Market --

The Select Portfolio – There is no change for this portfolio.

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