With the S&P 500 Having Gone Nowhere in 9 Years, CornerCap's Chief Investment Officer Offers Comments to Answer the 'What Next' Question

PRNewswire -- Some remember the 1970s when the stock market index was flat for an entire decade. Due to the OPEC oil cartel driving energy prices way up while inflation was simultaneously ratcheting up, the market went sideways.

"Now, thirty years later, we appear to have circled back for a repeat of that disappointing decade," says Thomas E. Quinn, the chief executive officer and chief investment officer of Atlanta-based CornerCap Investment Counsel, in a recently published commentary.

"Over the nine years between 1999 and 2008, a period many have referred to as the 'Lost Decade,' the S&P 500 stock index was down 6.75 percent or -0.8 percent annually and, like the 1970s, energy costs are once again skyrocketing, crowding out consumer purchases and contributing to fears of inflation," Quinn notes.

Noting that CornerCap's equity returns during this period were well over the averages of the Lost Decade, Quinn says a disciplined investment process that recognizes the booms and busts of the short-term market swings is the key to avoiding long-term pain.

"There is no magic," Quinn says. "Beating the averages over time requires a consistent philosophy and strict adherence to a buy / sell discipline which keep the probabilities in your favor."

The full text of Quinn's commentary is available online and may be downloaded at no cost from http://www.cornercap.com/library/Articles/07_15_08a.shtml .

According to Quinn, fear appears to be rampant now, with many investors selling their stock holdings. But probabilistically, Quinn says, broad selling now makes absolutely no sense.

"We can realistically observe the behavior of other investors," Quinn says. "We can objectively quantify when their behavior overpower the facts. In the long cycles, we can take advantage of those infrequent, but really extreme, investor obsessions. In the short cycles, we can continually rebalance our portfolios," he says.

"Simply stated, if we pay attention to probabilities rather than the pundits, we may lose a few small hands but we should ultimately win the game," Quinn says.

Survey Finds 29% of Americans Receiving Nonprofit Financial Counseling Use Federal Tax Stimulus to Pay for Food, Gasoline

PRNewswire -- A survey of 3,004 persons across the United States who receive financial counseling from a national nonprofit agency found that 29.4% used funds from their tax stimulus check to pay for everyday expenses, such as food and gasoline, while 20% said they paid down their credit card debt.

In addition, almost 5% of those surveyed said they utilized the funds to help them prevent foreclosure of their home or avoid bankruptcy. An additional 7.5% said the funds "give some more time to organize their finances and possibly avoid" these two scenarios.

In response to the question, "If you are facing foreclosure, will this check help you avoid foreclosure?" 3.5% responded "yes." An additional 5.1% of those surveyed, said the stimulus payment "gives some more time to organize finances and possibly avoid foreclosure."

Approximately 1.4% surveyed, said the funds would help them avoid bankruptcy, while 2.4% said the funds will allow them more time to organize their finances and possibly avoid bankruptcy.

The survey was conducted in late June by Consumer Credit Counseling Service (CCCS) of Greater Atlanta, a national nonprofit agency that provides credit counseling, as well as counseling to prevent foreclosure and avoid bankruptcy, to people in all 50 states. Of the 3,004 responding to the survey, 2,147 had received their check from the federal government.

"Many Americans are using the federal stimulus checks to help them get by and pay for everyday expenses," said Suzanne Boas, president of CCCS of Greater Atlanta. "The extra money is providing them breathing room with their creditors, including those who want to avoid foreclosure and keep their homes."

Approximately $106.7 billion in stimulus payments will be made this year to 130 million households. The payments began on April 28 and are scheduled to be completed by mid-July.

Rather than spend funds on new purchases, the survey also shows that some Americans are using the stimulus checks to make additional payments on their mortgage, car or other loans, and others are using the funds for home repairs. For example:

-- 7.8% said they would use the funds to make an additional payment on their mortgage;

-- 9% said they would make an additional payment on another debt, such as a car payment or a student loan;

-- Approximately 5.6% of respondents said the funds will be used to make home repairs;

-- 2.5% said they would use the funds to pre-pay their property or income taxes for 2008.

Other survey findings include:

-- Approximately 82% of the people surveyed said they plan to save 20% or less of the tax stimulus funds they receive.

Asked to rate the state of their current financial situation on a scale of 1 to 10, with 1 being the "most stressful," about 33.6% of respondents rated their situation a "1."

When asked, "What is your confidence level in the economy six months from now," 66% expect it to worsen and only 11% expect it to improve. The remaining people surveyed expect the economy to remain the same.

Statement from Governor Sonny Perdue Concerning President Bush’s Lifting of Executive Order on Offshore Drilling

Governor Sonny Perdue issued the following statement today concerning President Bush’s Lifting of Executive Order on offshore drilling:

“With record gas prices straining the budgets of many Georgia families, we cannot afford to take any option off the table. It is imperative that we take a balanced approach of conserving, developing alternative energy technologies and increasing the supply of domestically-produced resources. I want to thank President Bush for his action today and I urge Congress to hear the voices of the American people who are asking for relief from our dependence on foreign oil.”

GeorgiaBankRobbery.com Website Announced to Aid in Apprehending Suspects

Special Agent in Charge (SAC) Gregory Jones, FBI Atlanta, in conjunction with the Georgia Association of Bank Security (GABS), is pleased to announce the following new aid to crime fighting in Georgia:

A new publicly accessed web site, GeorgiaBankRobbery.com, is designed to assist law enforcement in the identification and apprehension of suspects throughout Georgia. This web site features images of persons who may be involved in criminal activity and wanted for questioning. Through this web site, the public is urged to click on the image to send comments or contact law enforcement (a direct link with contact information for Atlanta Crime Stoppers is provided) should they recognize any of these individuals or know their whereabouts.

GeorgiaBankRobbery.com is sponsored by the member banks of the Georgia Association of Bank Security (GABS).

The Georgia Association of Bank Security (GABS) was formed in 1980 by Bank Security Directors from the Major Atlanta Financial Institutions, after discussions with each other found that they each had similar criminal activity that was affecting each others companies. They decided that one of the best ways they could help solve their own crimes was to help each other as a united group. They started sharing information about Bank Robbery Suspects and other financial crimes with not only each other but also the FBI, and Local & State Law Enforcement. They found out that not only was this group successful in solving crimes together, they could also be a unified force in making changes in security training, and driving new development for security equipment.

Omni Financial Services Receives Nasdaq Notice of Non-Compliance

BUSINESS WIRE--Omni Financial Services, Inc. (NASDAQ: OFSI) (the “Company”), the bank holding company for Omni National Bank, today announced that on July 10, 2008, the Company received a letter from the Listing Qualifications Staff of The Nasdaq Stock Market (the “Staff”) notifying the Company that it fails to comply with Nasdaq’s minimum market value of publicly held shares (the “MVPHS”) requirement for continued listing set forth in Nasdaq Marketplace Rule 4450(a)(2) (the “Rule”), which requires companies to maintain a MVPHS of $5,000,000.

In accordance with Marketplace Rule 4450(e)(1), the Company will be provided 90 calendar days, or until October 8, 2008, to regain compliance. If, at anytime before October 8, 2008, the MVPHS of the Company’s common stock is $5,000,000 or greater for a minimum of 10 consecutive trading days, the Staff will provide written notification to the Company that it has achieved compliance with the Rule. If the Company does not regain compliance with the Rule by October 8, 2008, the company’s common stock is subject to delisting. At that time, the Company may appeal the Staff’s determination to delist its securities to a Listing Qualifications Panel.

Forbes Ranks Georgia as Third Best State for Alternative Energy from Biomass

Forbes Magazine has tapped Georgia as the third best state in the nation for alternative energy from biomass. Also this week, cable news and business channel CNBC ranked Georgia in the top ten and second in the Southeast in its annual rankings of “America’s Top States for Business.”

According to a recent Forbes article entitled “America's Best Places For Alternative Energy,” the abundance of biomass in Georgia’s Bioenergy Corridor ranks third in the nation as a potential source of renewable energy. The article referenced the amount of privately owned forest in Georgia, more than any other state in the country, as a reason for the state’s ranking. Forbes also cited that “roughly 50 million tons of the state's own timber end up in the state's wood-products manufacturing plants every year” and the industry “returns nearly half of it in the form of primary mill wood debris.” Only Iowa and North Dakota ranked higher. Rounding out the top five were Mississippi and North Carolina.

“Georgia’s wealth of natural resources combined with our research institutions and a strong business climate create an ideal environment for the development of renewable energy,” said Governor Perdue. “We appreciate Forbes’ recognition of our ability to develop alternative energy sources.”

Georgia’s Energy Innovation Center (EIC), housed at the Georgia Environmental Facilities Authority (GEFA), draws on the state's vast resources to expand and strengthen Georgia's bioenergy industry. The EIC recruits and promotes industries focused on producing energy from clean and renewable sources. Georgia boasts an abundance of renewable natural resources such as pine trees and agricultural products, along with waste streams from agriculture and industrial processes, available as feedstocks for an expanding renewable energy industry. Companies concentrating on every aspect of energy development will find a streamlined and pro-active business environment in Georgia.

Georgia is at the forefront of the nation’s development of cellulosic ethanol, a non-food feedstock for the production of ethanol from pine and other wood residuals. Range Fuels broke ground on the nation’s first commercial-scale cellulosic ethanol plant in Soperton on November 6, 2007. The facility is expected to be operational in 2009. In addition, the state’s research institutions including the Georgia Institute of Technology, University of Georgia and the Herty Advanced Materials Development Center are providing R&D in support of cellulosic ethanol and other renewable energy alternatives.

The Bioenergy Corridor represents an extensive network of bioenergy-related businesses and organizations located throughout the state: Atlanta and Rome to the north; Columbus to the west; Albany, Valdosta and Brunswick to the south; and Athens, Augusta and Savannah to the east. The Bioenergy Corridor’s northern region encompasses research and development, academic, and public and private partnerships. Manufacturing facilities are primarily situated in the mid-to-south region, where a majority of commercial pine forests and current commercial forestry infrastructure are located.

This week, the financial network CNBC ranked Georgia in the top 10 in “America’s Top States for Business.” Coming in at number 8, the Peach State received high marks for its strong workforce, excellent transportation network and affordable cost of living. Georgia received the second highest ranking in the Southeast, behind only North Carolina, which came in at number 6.

Each year, CNBC compiles rankings for all 50 states in 10 categories such as workforce, transportation, cost of doing business and others. The combined scores in those 10 categories are then used to generate an overall ranking.

“Georgia’s high ranking in America’s Top States for Business shows that CNBC appreciates our state’s selling points,” said Ken Stewart, commissioner of the Georgia Department of Economic Development. “We market Georgia every day by showcasing our well-trained workforce, unmatched transportation network and a cost of living that is welcoming to families.”

The state’s access to capital, business friendliness, cost of doing business, technology and innovation and overall economy also placed Georgia above average. According to its Web site, CNBC used publicly available data to score all 50 states on 40 different measures of competitiveness, which are separated into ten broad categories. For more information, visit the Web site at http://www.cnbc.com/id/25447603.

Sens. Chambliss-Isakson Urge USDA to Stop Plans to Change Peanut Program Loans

U.S. Senator Saxby Chambliss (R-Ga.), Ranking Republican Member on the Senate Agriculture Committee, and Johnny Isakson (R-Ga.) today sent a letter to U.S. Department of Agriculture Under Secretary Dr. Mark Keenum urging the Department to continue using the current peanut loan differential method for 2008 and 2009. The proposal made by USDA last month would result in a significantly lower marketing loan rate for the Runner variety, which makes up almost 100 percent of Georgia production. Georgia produces nearly 45 percent of all the peanuts produced in the United States, making it the number one peanut producing state.

Text of the letter is below:

July 10, 2008

Dr. Mark Keenum
Under Secretary
Farm and Foreign Agricultural Services
Room 205 Whitten Building
United States Department of Agriculture
1400 Independence Ave., SW
Washington, DC 20250

Dear Dr. Keenum:

Now that the 2008 farm bill has finally been enacted into law the responsibility of implementing the legislation consistent with Congressional intent falls on the Department of Agriculture. This task can be as daunting as crafting the legislation and we are appreciative of the efforts you have taken to expedite the implementation process.

However, we are concerned about proposed changes to the peanut program. Shortly after the passage of the farm bill, a white paper was distributed at the direction of Deputy Under Secretary Floyd Gaibler highlighting proposed changes to the method of determining marketing loan differentials for peanuts. The proposal to move to a market-based loan differential for peanuts was met with little to no support within the peanut industry. We find it very disturbing that since Congress made minimal changes to the Peanut Title of the 2008 farm bill that USDA would make such a drastic proposal, which was never discussed during the many farm bill meetings attended by the Department.

Recently you held an industry wide meeting to discuss the peanut market-based loan differential proposal. You made it clear to the industry that the proposal would not be implemented for the 2008 crop of peanuts, but that a decision for the 2009 and subsequent crop years has not yet been made. We are appreciative of the fact there will be no changes for the 2008 crop and that you assured the industry there would be an open dialogue on the subject before a final decision is made for the 2009 and subsequent crop years.

After the industry wide meeting, we both received a letter from the American Peanut Council (APC). The APC is the trade association representing all segments of the U.S. peanut industry. The letter stated that APC members, at your request, reviewed the proposal again and still determined that if enacted the proposal, “…will harm the peanut industry and subject the federal government to the risk of increased financial losses.”

Dr. Keenum, we respectfully request that the peanut market-based loan differential proposal not be considered and that the Department continue to use the existing peanut loan differential method. The proposal is not supported by any segment of the industry and we are fearful that if the Department continues to pursue this proposal there will be a significant deterioration of USDA’s relationship with the peanut industry.

Please do not hesitate to contact us or our staff if you have any questions about our request.

Very truly yours,

Saxby Chambliss
Johnny Isakson