If you missed it, you need to read Paul Farrell’s “All wrong! Bernanke, Paulson, Greenspan.” Not that this piece will help you much with your investing efforts, it’s the media circus at its best. Read it for entertainment only.

Yes, it’s hard to believe that Paul, who has forever touted the Buy-and-Hold the coffeehouse and gone-fishing portfolios, is now forecasting a bear recession. His solution is “bonds” based on the fact that history suggests a rally.

Hmm, based on his past writings, I was under the impression that you should hold his coffeehouse portfolios forever. That it was a solution for all times, no matter if bull or bear market. What happened?

From my vantage point, it’s the usual media hype of useless information at its finest. As I wrote in Thursday’s blog, we may be facing a changing headwind, but the investments of choice can’t yet be determined.

I believe it’s a better approach to be rational in your decisions and make changes when appropriate (and trends can be established) as opposed to writing articles that do nothing but spread fear and uncertainty to the investing public.

My latest No Load Fund/ETF Tracker has been posted at:

http://www.successful-investment.com/newsletter-archive.php

Thanks to Federal Reserve’s decision to lower interest rates by 1/2%, the markets staged one of the best rallies in quite some time.

Our Trend Tracking Index (TTI) for domestic funds/ETFs jumped to +5.03% above its long-term trend line (red) as the chart below shows:

The international index also moved sharply higher to +2.73% above its own trend line, keeping us safely on the buy side.

For more details, and the latest market commentary, as well as the updated No load Fund/ETF StatSheet, please see the above link.

With the recent announcement of unexpected job losses during August, and now the lowering of interest rates, the question about a slowing economy in 2008 has been moved again to the front pages. At this time this is only speculation, however, you may be interested in knowing which investment orientations might have the best potential during times of a slowdown.

Obviously, interest rate sensitive instruments have always worked well, but what else? In my view, it’s way too early to tell specifics; however, as a regular reader of my weekly StatSheet, you will know first as to when new opportunities develop.

As the economy works itself through this cycle and into a different one, you will notice how the M-Index rankings of my listed no load funds and ETFs are changing. While it is possible that we may very well have sell signals in domestic and international funds, the wide variety of sectors will offer investment opportunities for a different economic environment.

As I mentioned before, the glut of ETFs and their ongoing dissection into many sectors will eventually be a benefit to all of us, since there will always be areas in demand even in a slumping economy. My data base currently contains over 1,700 no load funds and ETFs, with more being added.

As time goes on, follow the changes in the rankings, which will give you a clue as to which investment orientations are on the way up and which ones are on the way down.

It’s been an age old question. You’re facing retirement and are trying to decide whether it is wise to pay off your home mortgage or not. Maybe you have a bias because you witnessed your parents’ mortgage burning ceremony and are wondering if that still makes sense nowadays.

As a general rule, I believe that living a retired life without a mortgage is a worthwhile goal; however, there is no one fits all solution as circumstances vary widely for each individual. Forbes had an article called “Burdening Your Retirement with a Mortgage,” which outlines many of the pros and cons. Some of them might give you the answer you’ve been looking for or at least make you look at your own situation from a different angle to clarify your thinking.

Wall Street got its version of an early Christmas present by finally getting a long wished for rate cut by the Fed. Not only that, the cut was wide and deep, encompassing the Fed Funds rate and the Discount rate at a hoped for ½ point rather than the acceptable ¼ point.

As the chart above shows, the reaction was fast and furious with all major indexes scoring solidly.

Our Trend Tracking Indexes (TTIs) rallied as well and moved above their respective trend lines as follows:

Domestic TTI: +5.38%
International TTI: +2.17%

It will be interesting to see if this move to the upside will be supported in the coming days (and weeks) by more buying which is necessary to support this breakout from the current sideways pattern.

We are holding all current positions subject to our sell stop rules and are adding where appropriate.

On September 10, Barclays Global Investors debuted the first ETF to track the U.S. municipal bond market, which will provide investors a different way to invest in municipal issues as reported by Bloomberg.

My preference for investors with after-tax money wishing to generate income has always been the use of closed end muni funds, the benefits which have been detailed in my free e-book. This will offer investors another opportunity, and I will track pricing and yield of the new iShares S&P; National Municipal Bond Fund (MUB) to see how it compares to old fashioned muni CEFs.

One obvious advantage is the instant diversification this $294 million ETF would provide. Income is distributed monthly and throughout the day pricing provides more transparency than individual bonds. The expense ratio is pegged to be $25 for every $10,000 of assets.

Not to be outdone, State Street announced a similar offering to be available around September 13. Another player in that field is the SPDR Lehman Municial Bond ETF, with the ticker symbol TFI which will track the three-year old Lehman Brothers Municipal Managed Money Index.

With other offerings in the pipeline, it is the individual investor who will benefit by having more and better choices, which is a development I applaud.