Market Commentary by Scott J. Brown, Ph.D., Chief Economist

Scott J. Brown Ph.D., Chief Economist Raymond James Investment Services

Europe, again. Election results in France and Greece were not a surprise, but they added to concerns about the European crisis. The important aspect, for U.S. investors, is the uncertainty. Nobody knows exactly what will happen in Europe, but few doubt that the situation will be resolved anytime soon.

The second bailout agreement for Greece was only a few months ago, but at the time many felt that Greece would never be able to live up to the requirements.

Elsewhere in Europe, there has been some backsliding on austerity. Tighter budgets have weakened the troubled economies in Europe and have done nothing to resolve financial difficulties. Austerity is needed in the long term, but what’s needed in the short term is economic growth.

The economic calendar was thin. The trade deficit widened more than most analysts expected, but figures were only slightly wider than what was assumed in the advance GDP report.

Jobless claims appear to have settled down (at nearly the same pace as in March) after seasonal adjustment quirks lifted the figures in the first three weeks of April. Consumer sentiment improved in the mid-May assessment.

Next week, Europe is expected to be an ongoing concern for U.S. investors, but the arrival of mid-month economic data will provide a distraction. The focus is likely to be on the retail sales and residential construction reports. April’s retail sales are likely to have been moderate. April building permits and housing starts are expected to reflect an unwinding of the multi-family noise from March (single-family construction appears to have turned the corner, but a full recovery in housing is years away). The FOMC policy meeting minutes could include some market-moving quotes.

Indices

Consumer Money Rates

Currencies

[470center]

Commodities

Bond Rates

Treasury Yield Curve – 5/11/2012

[320center]

S&P Sector Performance (YTD) – 5/11/2012

Economic Calendar

Important Disclosures

[320left]Past performance is not a guarantee of future results. There are special risks involved with global investing related to market and currency fluctuations, economic and political instability, and different financial accounting standards. The above material has been obtained from sources considered reliable, but we do not guarantee that it is accurate or complete. There is no assurance that any trends mentioned will continue in the future. While interest on municipal bonds is generally exempt from federal income tax, it may be subject to the federal alternative minimum tax, state or local taxes. In addition, certain municipal bonds (such as Build America Bonds) are issued without a federal tax exemption, which subjects the related interest income to federal income tax. Investing involves risk and investors may incur a profit or a loss.

US government bonds and treasury bills are guaranteed by the US government and, if held to maturity, offer a fixed rate of return and guaranteed principal value. US government bonds are issued and guaranteed as to the timely payment of principal and interest by the federal government. Treasury bills are certificates reflecting short-term (less than one year) obligations of the US government.

Commodities trading is generally considered speculative because of the significant potential for investment loss. Markets for commodities are likely to be volatile and there may be sharp price fluctuations even during periods when prices overall are rising. Specific sector investing can be subject to different and greater risks than more diversified investments.

Tax Equiv Muni yields (TEY) assume a 35% tax rate on triple-A rated, tax-exempt insured revenue bonds.

Material prepared by Raymond James for use by its financial advisors.

The information contained herein has been obtained from sources considered reliable, but we do not guarantee that the foregoing material is accurate or complete. Data source: Bloomberg, as of close of business April 26th, 2012.

©2012 Raymond James Financial Services, Inc. member FINRA / SIPC.

Market Commentary by Scott J. Brown, Ph.D., Chief Economist

Scott J. Brown Ph.D., Chief Economist Raymond James Investment Services

As expected, the Federal Open Market Committee left short-term interest rates unchanged and refrained from additional asset purchases. The Fed still expects that “economic conditions – including low rates of resource utilization and a subdued outlook for inflation over the medium run – are likely to warrant exceptionally low levels for the federal funds rate at least through late 2014.”However, officials were still divided on when they thought it would be appropriate to start tightening. Officials revised higher their projections for 2012 GDP growth, but slightly lower their growth expectations for 2013 and 2014.

Real GDP rose at a 2.2% annual rate in the advance estimate for 1Q12, below the +2.5% median forecast. The details were a mixed bag. Consumer spending rose at a 2.9% annual rate, led by a sharp increase in motor vehicles. Business fixed investment fell at a 2.1% pace (structures down 12.0%, equipment and software up 1.7%).

Residential fixed investment picked up, adding 0.4 percentage point to GDP growth. A faster pace of inventory accumulation (likely unintentional) added 0.6 percentage point. Government remained a drag on overall growth, subtracting 0.6 percentage point. An increase in exports was roughly offset by an increase in imports. The PCE Price Index ex-food and energy rose 2.1% (+1.9% y/y), very near the Fed’s inflation target.

Stock market participant began the week worrying about global growth, but the market spit out bad news at the end of the week (a disappointing GDP report, developments in Spain).

Next week, the focus is expected to be on the April Employment Report. The unusually mild winter likely shifted seasonal job gains from March and April into January and February, but it’s unclear how much of a payback we’ll see in April. In addition, higher gasoline prices may have dampened the pace of hiring.

Indices

Consumer Money Rates

Currencies

[470center]

Commodities

Bond Rates

Treasury Yield Curve – 4/27/2012

S&P Sector Performance (YTD) – 4/27/2012

Economic Calendar

Important Disclosures

[320left]Past performance is not a guarantee of future results. There are special risks involved with global investing related to market and currency fluctuations, economic and political instability, and different financial accounting standards. The above material has been obtained from sources considered reliable, but we do not guarantee that it is accurate or complete. There is no assurance that any trends mentioned will continue in the future. While interest on municipal bonds is generally exempt from federal income tax, it may be subject to the federal alternative minimum tax, state or local taxes. In addition, certain municipal bonds (such as Build America Bonds) are issued without a federal tax exemption, which subjects the related interest income to federal income tax. Investing involves risk and investors may incur a profit or a loss.

US government bonds and treasury bills are guaranteed by the US government and, if held to maturity, offer a fixed rate of return and guaranteed principal value. US government bonds are issued and guaranteed as to the timely payment of principal and interest by the federal government. Treasury bills are certificates reflecting short-term (less than one year) obligations of the US government.

Commodities trading is generally considered speculative because of the significant potential for investment loss. Markets for commodities are likely to be volatile and there may be sharp price fluctuations even during periods when prices overall are rising. Specific sector investing can be subject to different and greater risks than more diversified investments.

Tax Equiv Muni yields (TEY) assume a 35% tax rate on triple-A rated, tax-exempt insured revenue bonds.

Material prepared by Raymond James for use by its financial advisors.

The information contained herein has been obtained from sources considered reliable, but we do not guarantee that the foregoing material is accurate or complete. Data source: Bloomberg, as of close of business April 26th, 2012.

©2012 Raymond James Financial Services, Inc. member FINRA / SIPC.

Market Commentary by Scott J. Brown, Ph.D., Chief Economist

Scott J. Brown Ph.D., Chief Economist Raymond James Investment Services

Europe remained a key concern for U.S. investors. Spain’s debt auction went better than feared. Global investors expressed some concerns about France’s election (first round on April 22nd, second round on May 6th). In its World Economic Outlook, the IMF revised its outlook for global growth slightly higher, but cautioned that “recent improvements are very fragile.”

The U.S. economic data were mixed. Retail sales were stronger than expected in March. Existing home sales and industrial production were weaker than anticipated. Residential construction figures were mixed (permits up, starts down), but first quarter figures were stronger than a year ago (likely aided by a mild winter). Weekly jobless claims were higher than expected, but seasonal adjustment at the start of the quarter is difficult, making recent figures appear suspect.

Next week, the focus is expected to be on the Fed policy meeting, although earnings reports, European developments, and Friday’s GDP Report will likely have some influence on the markets. No monetary policy changes are expected following the Federal Open Market Committee – no change in rates, no change in the conditional commitment to keep rates exceptionally low into late 2014, and no further asset purchase plans (QE3).

Fed officials will revise their forecasts of growth, unemployment and inflation, as well as the expected date that the Fed will start raising the federal funds rate target. Real GDP is expected to have risen at close to a 2.6% annual rate, although there is always a lot of uncertainty in the advance estimate (inventories and net exports account for a small part of GDP, but a disproportional amount of the quarterly variation of GDP growth).

Indices

Consumer Money Rates

Currencies

Commodities

Bond Rates

Treasury Yield Curve – 4/20/2012

S&P Sector Performance (YTD) – 4/20/2012

Economic Calendar

Important Disclosures

[320left]Past performance is not a guarantee of future results. There are special risks involved with global investing related to market and currency fluctuations, economic and political instability, and different financial accounting standards. The above material has been obtained from sources considered reliable, but we do not guarantee that it is accurate or complete. There is no assurance that any trends mentioned will continue in the future. While interest on municipal bonds is generally exempt from federal income tax, it may be subject to the federal alternative minimum tax, state or local taxes. In addition, certain municipal bonds (such as Build America Bonds) are issued without a federal tax exemption, which subjects the related interest income to federal income tax. Investing involves risk and investors may incur a profit or a loss.

US government bonds and treasury bills are guaranteed by the US government and, if held to maturity, offer a fixed rate of return and guaranteed principal value. US government bonds are issued and guaranteed as to the timely payment of principal and interest by the federal government. Treasury bills are certificates reflecting short-term (less than one year) obligations of the US government.

Commodities trading is generally considered speculative because of the significant potential for investment loss. Markets for commodities are likely to be volatile and there may be sharp price fluctuations even during periods when prices overall are rising. Specific sector investing can be subject to different and greater risks than more diversified investments.

Tax Equiv Muni yields (TEY) assume a 35% tax rate on triple-A rated, tax-exempt insured revenue bonds.

Material prepared by Raymond James for use by its financial advisors.

The information contained herein has been obtained from sources considered reliable, but we do not guarantee that the foregoing material is accurate or complete. Data source: Bloomberg, as of close of business April 19th, 2012.

©2012 Raymond James Financial Services, Inc. member FINRA / SIPC.

Market Commentary by Scott J. Brown, Ph.D., Chief Economist

Scott J. Brown Ph.D., Chief Economist Raymond James Investment Services

The stock market began the week with a (negative) reaction to the March Employment Report (which was softer than expected, but not terrible). Worries about Europe and global growth also weighed against market sentiment – the fear subsided a bit on Wednesday and Thursday, but appeared to return on Friday. Fed officials suggest that monetary policy was conditional on how the economy develops – although no action is expected anytime soon.

The economic data remained consistent with moderate growth and moderate inflation. As expected, the seasonal adjustment dampened the impact of higher gasoline prices in the Consumer Price Index. The core CPI rose 2.3% y/y. The Fed’s Beige Book noted “modest to moderate” economic growth.

Next week, the retail sales report will likely set the tone for the week, although we could see market reactions to any surprises in the other data reports. Fed officials will go quiet (there’s an unofficial blackout period, a week before and after policy meetings, where officials won’t comment on the economy or monetary policy).

Earnings and Europe are expected to remain important factors for the financial markets.

Indices

Consumer Money Rates

Currencies

Commodities

Bond Rates

Treasury Yield Curve – 4/13/2012

S&P Sector Performance (YTD) – 4/13/2012

Economic Calendar

Important Disclosures

[320left]Past performance is not a guarantee of future results. There are special risks involved with global investing related to market and currency fluctuations, economic and political instability, and different financial accounting standards. The above material has been obtained from sources considered reliable, but we do not guarantee that it is accurate or complete. There is no assurance that any trends mentioned will continue in the future. While interest on municipal bonds is generally exempt from federal income tax, it may be subject to the federal alternative minimum tax, state or local taxes. In addition, certain municipal bonds (such as Build America Bonds) are issued without a federal tax exemption, which subjects the related interest income to federal income tax. Investing involves risk and investors may incur a profit or a loss.

US government bonds and treasury bills are guaranteed by the US government and, if held to maturity, offer a fixed rate of return and guaranteed principal value. US government bonds are issued and guaranteed as to the timely payment of principal and interest by the federal government. Treasury bills are certificates reflecting short-term (less than one year) obligations of the US government.

Commodities trading is generally considered speculative because of the significant potential for investment loss. Markets for commodities are likely to be volatile and there may be sharp price fluctuations even during periods when prices overall are rising. Specific sector investing can be subject to different and greater risks than more diversified investments.

Tax Equiv Muni yields (TEY) assume a 35% tax rate on triple-A rated, tax-exempt insured revenue bonds.

Material prepared by Raymond James for use by its financial advisors.

The information contained herein has been obtained from sources considered reliable, but we do not guarantee that the foregoing material is accurate or complete. Data source: Bloomberg, as of close of business April 4th, 2012.

©2012 Raymond James Financial Services, Inc. member FINRA / SIPC.

Market Commentary by Scott J. Brown, Ph.D., Chief Economist

Scott J. Brown Ph.D., Chief Economist Raymond James Investment Services

The week began with a speech by Fed Chairman Bernanke, where he noted that “further significant improvements in the unemployment rate will likely require a more-rapid expansion of production and demand from consumers and businesses, a process that can be supported by continued accommodative policies.”Many interpreted this to mean that further asset purchases (QE3) were still on the table (if somewhat unlikely). Concerns about softer global growth seemed to weigh against equity market sentiment through the middle of the week. Quarter-end likely window-dressing added a bit to market volatility. Bond yields fell.

The economic data reports were mixed. The personal income and spending figures were probably the most important, but were not fully appreciated by the markets.

A month ago, inflation-adjusted consumer spending (roughly 70% of Gross Domestic Product) was reported flat in November, December, and January – suggesting an unexpectedly soft first quarter. However, inflation-adjusted spending was reported to have risen 0.5% in February, and December and January figures were revised higher. As a result, consumer spending appears to be on a 2.0% to 2.5% track (annual rate) in 1Q12, vs. the 1.0% to 2.0% pace seen a month ago. Economists are expected to revise their first quarter GDP growth forecasts higher.

Next week, key labor market data will arrive at the end of the week. The stock market will be closed for the Good Friday holiday, but the bond market will be open half the day. An unusually mild winter boosted payroll figures for January and February. There may be some payback (a somewhat slower rate of job growth) in March and April. However, the trend is expected to remain strong. While weather has certainly played a roll, easier bank credit to consumers and small businesses has been an important factor fueling the expansion. Higher gasoline prices are a threat, but the impact depends on the magnitude and duration of the increase (and the impact usually arrives with a lag).

Indices

Consumer Money Rates

Currencies

Commodities

Bond Rates

Treasury Yield Curve – 3/30/2012

S&P Sector Performance (YTD) – 3/30/2012

Economic Calendar

Important Disclosures

[320left]Past performance is not a guarantee of future results. There are special risks involved with global investing related to market and currency fluctuations, economic and political instability, and different financial accounting standards. The above material has been obtained from sources considered reliable, but we do not guarantee that it is accurate or complete. There is no assurance that any trends mentioned will continue in the future. While interest on municipal bonds is generally exempt from federal income tax, it may be subject to the federal alternative minimum tax, state or local taxes. In addition, certain municipal bonds (such as Build America Bonds) are issued without a federal tax exemption, which subjects the related interest income to federal income tax. Investing involves risk and investors may incur a profit or a loss.

US government bonds and treasury bills are guaranteed by the US government and, if held to maturity, offer a fixed rate of return and guaranteed principal value. US government bonds are issued and guaranteed as to the timely payment of principal and interest by the federal government. Treasury bills are certificates reflecting short-term (less than one year) obligations of the US government.

Commodities trading is generally considered speculative because of the significant potential for investment loss. Markets for commodities are likely to be volatile and there may be sharp price fluctuations even during periods when prices overall are rising. Specific sector investing can be subject to different and greater risks than more diversified investments.

Tax Equiv Muni yields (TEY) assume a 35% tax rate on triple-A rated, tax-exempt insured revenue bonds.

Material prepared by Raymond James for use by its financial advisors.

The information contained herein has been obtained from sources considered reliable, but we do not guarantee that the foregoing material is accurate or complete. Data source: Bloomberg, as of close of business March 29th, 2012.

©2012 Raymond James Financial Services, Inc. member FINRA / SIPC.

Market Commentary by Scott J. Brown, Ph.D., Chief Economist

Scott J. Brown Ph.D., Chief Economist Raymond James Investment Services

Worries about the Greek debt swap agreement weighed against global stock markets earlier in the week, but confidence returned as the Greek deal looked like it would succeed. The February job market figures were strong, a positive for equities and a negative for bonds, but most of that news was already factored in.

Nonfarm payrolls rose by 227,000 in February, while the two previous months were revised a net 61,000 higher (leaving the three-month average at 245,000). The unemployment rate held steady at 8.3%, but that was despite an increase in labor force participation (which rose from 63.7% to 63.9%). The employment-to-population ratio edged up to 58.6%, vs. 58.5% in January and 58.4% in December. It’s likely that the unusually mild winter had a significant impact on payrolls, hours, and labor force participation.

The household survey showed that 178,000 were unable to work during the survey week due to adverse weather – that compares to a 484,000 average over the last five Februarys. Thus, mild weather may have pulled forward seasonal gains that would otherwise have occurred in March or April. In addition, higher gasoline prices could dampen the pace of new hiring over the near term.

Next week, the reports on retail sales and industrial production are expected to reflect a continued economic recovery. The Fed policy meeting is expected to result in no change, despite some talk recently of “sterilized” QE3 (that’s were the Fed would buy long-term assets to push long-term rates lower, and reverse repo short-term securities to leave the size of the balance sheet unchanged).

Indices

Consumer Money Rates

Currencies

Commodities

Bond Rates

Treasury Yield Curve– 3/09/2012

S&P Sector Performance (YTD) – 3/09/2012

Economic Calendar

Important Disclosures

[320left]Past performance is not a guarantee of future results. There are special risks involved with global investing related to market and currency fluctuations, economic and political instability, and different financial accounting standards. The above material has been obtained from sources considered reliable, but we do not guarantee that it is accurate or complete. There is no assurance that any trends mentioned will continue in the future. While interest on municipal bonds is generally exempt from federal income tax, it may be subject to the federal alternative minimum tax, state or local taxes. In addition, certain municipal bonds (such as Build America Bonds) are issued without a federal tax exemption, which subjects the related interest income to federal income tax. Investing involves risk and investors may incur a profit or a loss.

US government bonds and treasury bills are guaranteed by the US government and, if held to maturity, offer a fixed rate of return and guaranteed principal value. US government bonds are issued and guaranteed as to the timely payment of principal and interest by the federal government. Treasury bills are certificates reflecting short-term (less than one year) obligations of the US government.

Commodities trading is generally considered speculative because of the significant potential for investment loss. Markets for commodities are likely to be volatile and there may be sharp price fluctuations even during periods when prices overall are rising. Specific sector investing can be subject to different and greater risks than more diversified investments.

Tax Equiv Muni yields (TEY) assume a 35% tax rate on triple-A rated, tax-exempt insured revenue bonds.

Material prepared by Raymond James for use by its financial advisors.

The information contained herein has been obtained from sources considered reliable, but we do not guarantee that the foregoing material is accurate or complete. Data source: Bloomberg, as of close of business March 1st, 2012.

©2012 Raymond James Financial Services, Inc. member FINRA / SIPC.

Market Commentary by Scott J. Brown, Ph.D., Chief Economist

Scott J. Brown Ph.D., Chief Economist Raymond James Investment Services

The economic data reports were mixed. Real GDP rose at a 3.0% annual rate in the 2nd estimate for 4Q11 (vs. +2.8% in the advance estimate), with slight upward revisions to consumer spending and business fixed investment. The details of the report showed a significant upward revision to estimates of personal income for both 3Q11 and 4Q11 (that news, suggesting that the trend in income wasn’t especially strong, but a lot less weak than previously estimated, went largely unnoticed by the markets).

Consumer spending was softer than expected in February, held down partly by a weather-related decrease in energy consumption (ex-energy, spending rose 0.4%). Still, adjusted for inflation, consumer spending was flat for the third consecutive month in January. Since consumer spending accounts for 70% of overall GDP, these data suggest that first quarter growth may be a lot weaker than was hoped for earlier.

Unit auto sales jumped to a 15.0 million seasonally adjusted annual rate in February, up from 14.1 million in January and 13.0 million a year ago. The February ISM Manufacturing Index fell. Consumer confidence improved, but the survey missed much of the recent increase in gasoline prices.

In his semi-annual testimony on monetary policy, Fed Chairman Bernanke said that recent information “is consistent with growth proceeding, in coming quarters, at a pace close to or somewhat above the pace that was registered during the second half of last year (about 2¼%).” Bernanke noted that “continued improvement in the job market is likely to require stronger growth in final demand and production” and added that “strains in global financial markets pose significant downside risks to the economic outlook.” However, the markets focused on what he didn’t say – that is, there was no hint of further asset purchases in the near term.

Next week, the focus is expected to be on Friday’s job market report. Seasonal adjustment will remain an important factor in February, adding, along with the weather, considerable uncertainty to the payroll estimate. However, it’s unclear whether mild weather has pulled forward gains that normally would have occurred in March and April (as is often the case). More troublesome, high gasoline prices, if sustained, are likely to dampen the pace of hiring for smaller firms.

Indices

Consumer Money Rates

Currencies

Commodities

Bond Rates

Treasury Yield Curve – 3/02/2012

S&P Sector Performance (YTD) – 3/02/2012

Economic Calendar

Important Disclosures

[320left]Past performance is not a guarantee of future results. There are special risks involved with global investing related to market and currency fluctuations, economic and political instability, and different financial accounting standards. The above material has been obtained from sources considered reliable, but we do not guarantee that it is accurate or complete. There is no assurance that any trends mentioned will continue in the future. While interest on municipal bonds is generally exempt from federal income tax, it may be subject to the federal alternative minimum tax, state or local taxes. In addition, certain municipal bonds (such as Build America Bonds) are issued without a federal tax exemption, which subjects the related interest income to federal income tax. Investing involves risk and investors may incur a profit or a loss.

US government bonds and treasury bills are guaranteed by the US government and, if held to maturity, offer a fixed rate of return and guaranteed principal value. US government bonds are issued and guaranteed as to the timely payment of principal and interest by the federal government. Treasury bills are certificates reflecting short-term (less than one year) obligations of the US government.

Commodities trading is generally considered speculative because of the significant potential for investment loss. Markets for commodities are likely to be volatile and there may be sharp price fluctuations even during periods when prices overall are rising. Specific sector investing can be subject to different and greater risks than more diversified investments.

Tax Equiv Muni yields (TEY) assume a 35% tax rate on triple-A rated, tax-exempt insured revenue bonds.

Material prepared by Raymond James for use by its financial advisors.

The information contained herein has been obtained from sources considered reliable, but we do not guarantee that the foregoing material is accurate or complete. Data source: Bloomberg, as of close of business March 1st, 2012.

©2012 Raymond James Financial Services, Inc. member FINRA / SIPC.

Market Commentary by Scott J. Brown, Ph.D., Chief Economist

Scott J. Brown Ph.D., Chief Economist Raymond James Investment Services

A deal was reached in the €130 billion bailout package for Greece. However, investors almost immediately began to doubt Greece’s ability to stick to the plan (especially given the unrealistic assumptions about Greece’s growth prospects). Meanwhile, oil and gasoline prices continued to rise, posing a more significant threat to the U.S. growth outlook.

The economic calendar was relatively thin. Home sales figures were mixed, but January housing data aren’t all that critical. Jobless claims continued to trend at a relatively low level. Consumer sentiment rebounded from a dip in the middle of the month, apparently as job market optimism offset worries about higher gasoline prices.

Next week, the calendar heats up again.

The Fed Chairman’s semi-annual monetary policy testimony to Congress (to the House Financial Services Committee on Wednesday and to the Senate Banking Committee on Thursday) is often a big deal for the markets, but we’re unlikely to learn much this week. That is, Bernanke should present a moderate, but uncertain economic outlook.

Monetary policy changes (more QE) would depend on a loss of momentum in growth or expectations that inflation will be below target. The estimate of 4Q11 GDP growth is expected to be little changed from the advance estimate (+2.8%). The Beige Book will provide anecdotal evidence of what’s going on with the economy (expected to be a bit brighter than the previous assessment).

Indices

Consumer Money Rates

Currencies

Commodities

Bond Rates

Treasury Yield Curve – 2/24/2012

S&P Sector Performance (YTD) – 2/24/2012

Economic Calendar

Important Disclosures

[320left]Past performance is not a guarantee of future results. There are special risks involved with global investing related to market and currency fluctuations, economic and political instability, and different financial accounting standards. The above material has been obtained from sources considered reliable, but we do not guarantee that it is accurate or complete. There is no assurance that any trends mentioned will continue in the future. While interest on municipal bonds is generally exempt from federal income tax, it may be subject to the federal alternative minimum tax, state or local taxes. In addition, certain municipal bonds (such as Build America Bonds) are issued without a federal tax exemption, which subjects the related interest income to federal income tax. Investing involves risk and investors may incur a profit or a loss.

US government bonds and treasury bills are guaranteed by the US government and, if held to maturity, offer a fixed rate of return and guaranteed principal value. US government bonds are issued and guaranteed as to the timely payment of principal and interest by the federal government. Treasury bills are certificates reflecting short-term (less than one year) obligations of the US government.

Commodities trading is generally considered speculative because of the significant potential for investment loss. Markets for commodities are likely to be volatile and there may be sharp price fluctuations even during periods when prices overall are rising. Specific sector investing can be subject to different and greater risks than more diversified investments.

Tax Equiv Muni yields (TEY) assume a 35% tax rate on triple-A rated, tax-exempt insured revenue bonds.

Material prepared by Raymond James for use by its financial advisors.

The information contained herein has been obtained from sources considered reliable, but we do not guarantee that the foregoing material is accurate or complete. Data source: Bloomberg, as of close of business February 23rd, 2012.

©2012 Raymond James Financial Services, Inc. member FINRA / SIPC.

Market Commentary by Scott J. Brown, Ph.D., Chief Economist

Scott J. Brown Ph.D., Chief Economist Raymond James Investment Services

The Greek soap opera continued, but investors took some encouragement in the hope that a deal will be soon reached. Bond yields backed up on reduced fear about Europe and on reduced odds of further Fed asset purchases.

The January 24-25 Fed policy meeting minutes showed only “a few” officials leaning toward QE3, although others thought such action would be warranted if “the economy lost momentum or if inflation seemed likely to remain below the (2%) inflation mandate over the medium term.” Fed officials continued to see an unusually high level of uncertainty surrounding the outlooks for growth and unemployment.

The Consumer Price Index rose 0.2% in January (+2.9% year-over-year), up 0.2% ex-food & energy (+2.3% year-over-year). Bear in mind that the Fed’s inflation target gauge, the PCE Price Index, usually runs about 0.2 or 0.3 percentage points below the CPI (hence, core consumer price inflation appears to be right on target on a year-over-year basis).

Retail sales rose a disappointing 0.4% in January, with downward revisions to November and December. Industrial production was flat in January, held down by a weather-related 2.5% drop in the output of utilities (which followed a 2.4% decline in December) –manufacturing output rose 0.8%, following a 1.5% increase in December (+4.7% year-over-year).

Next week, the economic calendar thins out. Home sales figures are likely to see some benefit from an unusually mild winter, which could be exaggerated by the seasonal adjustment. The bond market will face supply (in the form of 2-, 5-, and 7- year notes).

Indices

Consumer Money Rates

Currencies

Commodities

Bond Rates

Treasury Yield Curve – 2/17/2012

S&P Sector Performance (YTD) – 2/17/2012

Economic Calendar

Important Disclosures

[320left]Past performance is not a guarantee of future results. There are special risks involved with global investing related to market and currency fluctuations, economic and political instability, and different financial accounting standards. The above material has been obtained from sources considered reliable, but we do not guarantee that it is accurate or complete. There is no assurance that any trends mentioned will continue in the future. While interest on municipal bonds is generally exempt from federal income tax, it may be subject to the federal alternative minimum tax, state or local taxes. In addition, certain municipal bonds (such as Build America Bonds) are issued without a federal tax exemption, which subjects the related interest income to federal income tax. Investing involves risk and investors may incur a profit or a loss.

US government bonds and treasury bills are guaranteed by the US government and, if held to maturity, offer a fixed rate of return and guaranteed principal value. US government bonds are issued and guaranteed as to the timely payment of principal and interest by the federal government. Treasury bills are certificates reflecting short-term (less than one year) obligations of the US government.

Commodities trading is generally considered speculative because of the significant potential for investment loss. Markets for commodities are likely to be volatile and there may be sharp price fluctuations even during periods when prices overall are rising. Specific sector investing can be subject to different and greater risks than more diversified investments.

Tax Equiv Muni yields (TEY) assume a 35% tax rate on triple-A rated, tax-exempt insured revenue bonds.

Material prepared by Raymond James for use by its financial advisors.

The information contained herein has been obtained from sources considered reliable, but we do not guarantee that the foregoing material is accurate or complete. Data source: Bloomberg, as of close of business February 16th, 2012.

©2012 Raymond James Financial Services, Inc. member FINRA / SIPC.

Market Commentary by Scott J. Brown, Ph.D., Chief Economist

Scott J. Brown Ph.D., Chief Economist Raymond James Investment Services

Global equity markets rallied on progress on a Greek bailout package, but reacted negatively as Greece stumbled as it approached the finish line. In the U.S., investors began to question whether the stock market rally has gone too fast in 2012.

The economic calendar was thin. Consumer credit rose sharply in December, following a strong gain in November, apparently reflecting the improvement in motor vehicle sales. The trade deficit was narrower than expected in December (implying, all else equal, a small upward revision to the 4Q11 GDP growth estimate).

Five big banks reached a foreclosure settlement with the attorneys general of 49 states and the Obama administration, which will provide mortgage adjustments for about 10% of those underwater on their mortgages and distribute checks of around $2000 to about 750,000 who were foreclosed upon through faulty or fraudulent practices. The settlement should help the housing sector to some extent, but is not expected to lead to a sharp recovery.

Next week, the economic calendar turns busy. The focus is likely to be on the reports of retail sales and consumer prices. Seasonal adjustment may magnify the impact of unusually mild weather in January (likely apparent in residential construction and industrial production). The White House’s Office of Management and Budget will release its budget outlook on Monday.

Significant deficit reduction is expected in this plan, following required discretionary spending cuts from last year’s Budget Control Act, but it will be interesting to see what gets cut and whether there will be a push to soften or postpone scheduled tax increases (the Bush tax cuts and the reduction in payroll taxes). Note that the payroll tax reduction, which is set to expire at the end of February, has yet to be extended for the full calendar year.

Indices

Consumer Money Rates

Currencies

Commodities

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Bond Rates

Treasury Yield Curve – 2/10/2012

S&P Sector Performance (YTD) – 2/10/2012

Economic Calendar

Treasury Yield Curve – 2/3/2012

S&P Sector Performance (YTD) – 2/3/2012

Economic Calendar

Important Disclosures

Past performance is not a guarantee of future results. There are special risks involved with global investing related to market and currency fluctuations, economic and political instability, and different financial accounting standards. The above material has been obtained from sources considered reliable, but we do not guarantee that it is accurate or complete. There is no assurance that any trends mentioned will continue in the future. While interest on municipal bonds is generally exempt from federal income tax, it may be subject to the federal alternative minimum tax, state or local taxes. In addition, certain municipal bonds (such as Build America Bonds) are issued without a federal tax exemption, which subjects the related interest income to federal income tax. Investing involves risk and investors may incur a profit or a loss.

US government bonds and treasury bills are guaranteed by the US government and, if held to maturity, offer a fixed rate of return and guaranteed principal value. US government bonds are issued and guaranteed as to the timely payment of principal and interest by the federal government. Treasury bills are certificates reflecting short-term (less than one year) obligations of the US government.

Commodities trading is generally considered speculative because of the significant potential for investment loss. Markets for commodities are likely to be volatile and there may be sharp price fluctuations even during periods when prices overall are rising. Specific sector investing can be subject to different and greater risks than more diversified investments.

Tax Equiv Muni yields (TEY) assume a 35% tax rate on triple-A rated, tax-exempt insured revenue bonds.

Material prepared by Raymond James for use by its financial advisors.

The information contained herein has been obtained from sources considered reliable, but we do not guarantee that the foregoing material is accurate or complete. Data source: Bloomberg, as of close of business February 9th, 2012.

©2012 Raymond James Financial Services, Inc. member FINRA / SIPC.