The third quarter was a rough one for investors, marked by the toxic debt limit debate, the sounding of recession alarms in the U.S., and doubts around the ability of policymakers in Europe to act decisively to stem a broadening crisis. These fears have taken a toll on a range of asset classes. With a number of issues unresolved headed into 4Q, investors with a long-term time horizon (3-5 years or more) should remain cautious, but balanced. Core fixed income and non-correlated strategies can help to minimize volatility, while compelling valuations in equities and high-yield bonds may represent an opportunity to rebalance at an attractive entry point.  September marked a month where the benefits of a diversification was muted while most asset classes were experiencing negative returns primarily lead by a lack of confidence and fear.  In our “Portfolio Revision Presentation” for the Private Client portfolios we discussed the probabilities for a pull back in the markets to different levels.  The Probability of a pull back around 8,500-10,500 (or continued trading in this range) on the Dow has a 40% probability, and the probability of a double dip recession similar to 2008 was only 10%.  As we continue to monitor the economic data out there we are seeing some decent numbers but once again this is not a market trading on fundamentals but one that is trading on fear and panic.  We continue to recommend advisors stay conservative with strategies being utilized with investors by utilizing the Capital Preservation Plus, Income Plus, & Conservative Growth strategies.  Finally, watch for our 4Q 2011 LSA Market Update, including updated charts related to Europe, the economy and valuations.