Last year I wrote at a time that turned out to be the start of a severe economic and financial market downturn. Looking back from our vantage point today we see the wreckage of failed banks, bankrupt Fannie Mae and Freddie Mac, an auto industry that is essentially nationalized. We have seen economic stimulus packages totaling hundreds of billions of dollars, and the injection of literally trillions of dollars into the economy from the Fed and the Treasure. We have seen a stock market that routinely moved several hundred points on a daily basis, and dropped by nearly half when all was said and done.

The Foundation's investment strategy was designed to survive a downturn the equal of the 1973 - 1974 time frame, and we found ourselves in an environment where the stock market losses easily equaled that period but in a much shorter time. In addition, the credit markets virtually froze so bonds were no help for a number of months.

All of this forced us to review out strategy and take quick action. The board reset our asset allocation to a more conservative stance, and temporarily modified our dividend policy. The whole thrust of this effort was to do everything possible to minimize loss of principal and still pay income to support our Baptist ministries.

The tide seems to have turned, with gains so far this year in excess of 20%. We still have a long way to go for full recovery, and the road ahead looks anything but smooth as the long-term effects of the stimulus may cause higher inflation or slower growth (or both).

We want you to know that we are working hard to take advantage of the positive moves we have been seeing as the economy recovers. The Foundation is healthy, and will continue to grow. Thank you for allowing us to serve you!