The LJL Secured High Yield Income

The LJL Secured High Yield Income Fund I, LLC

annualized return to investors as of 11/7/2008 was 10.47%

Diversification

Fully Invested

Compound Interest

Quick

Links

President's Summary

Investor News

Interest Rates

Real Estate

Stock Market

Economic

Indicators

International

Thought for

the Week

Joe Investor, the Markets Are All Yours Now

Bernanke hints at rate cut - Fed chairman says policymakers are 'ready to take additional steps' as markets remain volatile and economy weakens.

F.D.I.C. Offers Plan to Stem Foreclosures

Industrials Lose 5% on Week

Saving Detroit

Eurozone enters first recession

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President's Summary

On Thursday last week the Dow Jones Industrial Index opened up approximately 150 points it then dropped to minus 300 points and ended the day on the plus side by nearly 600 points only to give back more than 300 points on Friday. This is heaven if you are a day trader AND you are on the right side of the wave. Unfortunately most investment portfolios are drifting rudderless in the waves of this windblown volatile market. The adages that buy and hold over the long term is the best way to invest in the stock market and that investing in the stock market delivers the highest returns in the overall investment arena are true if you really invest for the long term. The Dow was at 169 in 1937 and at its current level of 8,497 has yielded a whopping 4,988% in 70 years! But dissecting this return one finds that the Dow was indeed 169 in 1937 and again 167 in 1949 down 1% after 12 years. Then a time of explosive growth from 167 in 1949 to 969 in 1965 an appreciation of 480% over 16 years. These returns were tempered from 969 in 1965 to 896 in 1982, losing 14% over 17 years. In 1982 the Dow rallied from 896 to 11,497 in 1999, a positive return of 1,183% over 17 years. And now we are at 8,497 in 2007 down 26% from 1999 and down 39% from the highs in 2007. It is therefore a question of how long your time horizon is. Since the inception of the LJL Secured High Yield Income Fund in April 2007 investors would lost 35% in the Dow, down 26% in oil stocks, even down 7% in owning Warren Buffett’s Berkshire Hathaway! Investing in the 2-year Treasury investors would have earned approximately 3% in 2007 on an annualized basis and half that in 2008. Investors who invested in the LJL Secured High Yield Fund in April 2007 and selected the compound interest feature have seen their investment grow by 17.02%!

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Investor News

For the past couple of decades, the markets have been dominated by institutional investors who devoured bargains so fast and in such bulk that individual investors were usually left, at best, with a few scraps. But pension funds, hedge funds, mutual funds and other institutions are under siege as their portfolios implode and investors redeem their shares, forcing the fund managers to raise cash. Virtually every investment that carries any risk is on sale. Stocks and bonds, at home and abroad, have had their prices slashed by up to 45% this year. Yet at the very moment when bargains abound, many of the giants who normally would buy can do nothing but sell. Welcome to a buyer's market without buyers. This is a huge change for the little guys. Rob Arnott, who oversees $35 billion at Research Affiliates LLC in Newport Beach, Calif., puts it this way: "The question that hardly anyone ever thinks about is: Who's on the other side of my trade, and why are they willing to be losers if I'm going to be a winner?" Ever since the 1970s, the person on the other side of your trade has almost always been someone who manages billions of dollars and has millions of dollars to spend on gathering more information than most individuals ever could. Now, however, as Mr. Arnott says, "You can -- and probably do -- have a counterparty on the other side of your trade who absolutely has to sell, perhaps at any price." You would be very wise to give these distressed sellers a little bit of your cash, which they overvalue, in exchange for some of the stocks and bonds that they are undervaluing. Sooner rather than later, institutions will no longer need to beg for cash, they will regain the upper hand over individuals, and the tables will turn again.

For the entire article from THE WALL STREET JOURNAL click here:

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Interest Rates

Warning that financial markets remain under "severe strain," Federal Reserve Chairman Ben Bernanke pledged Friday to work closely with other central banks to fix global financial problems and left open the door to a fresh interest rate cut to help brace the sinking U.S. economy. "The continuing volatility of markets and recent indicators of economic performance confirm that challenges remain," Bernanke said in remarks prepared for a central banking conference in Frankfurt, Germany. "For this reason, policymakers will remain in close contact, monitor developments closely and stand ready to take additional steps should conditions warrant." The Fed chief's remarks appeared to reinforce the view of Wall Street investors and economists that the Fed probably will lower interest rates again on Dec. 16, its last regularly scheduled meeting this year. The Fed's key rate is now at 1%. Although the Fed has ratcheted down rates and taken a flurry of unprecedented actions to arrest the worst financial crisis since the Great Depression, deep problems remain. Credit is still not flowing normally in the U.S. and overseas, hobbling not only the domestic economy but also the global economy, which many believe is edging toward recession. THE CHART BELOW IS THE "TED SPREAD" THE DIFFERENCE BETWEEN THE 3-MONTH TREASURY AND THE 3-MONTH LIBOR INDICATING THE HEALTH OF THE FINANCIAL SYSTEM - CLEARLY WE ARE STILL IN INTENSIVE CARE.

For the entire article from CNNMoney click here:

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Real Estate

Breaking with the Bush administration’s position, the Federal Deposit Insurance Corporation proposed Friday to use $24 billion in government financing to help 1.5 million American households avoid foreclosure. The agency’s plan, posted on its Web site Friday, would guarantee 2.2 million modified loans — mainly risky loans made to borrowers with weak credit or small down payments — through the end of next year. Borrowers would get reduced interest rates or longer loan terms to make their payments more affordable. The F.D.I.C. said the government’s backing will make the lending industry more willing to modify loans because taxpayers will absorb half of the losses if the borrower defaults again. Even if a third of borrowers default again on their modified loans, 1.5 million homes would still be saved, the F.D.I.C. says. Under the agency’s plan, monthly payments should not total more than 31 percent of homeowners’ pretax monthly income.

For the entire artcile from the NEW YORK TIMES click here:

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Stock Market

Mounting evidence that a slowing global economy is taking an increasing toll on both companies and consumers pushed stocks lower on Friday, bringing a volatile session and a wild week to a gloomy close. The Dow Jones Industrial Average seesawed all day long but finished near its intraday lows, falling 337.94 points, or 3.8%, to 8497.31, off 5% on the week. Twenty-eight of its 30 components ended lower on Friday. The market has been dogged in recent days by signs that consumer spending, which represents more than two-thirds of overall U.S. economic activity, is still under heavy pressure. A report out Friday showed the steepest monthly drop in retail sales on record, a number of department-store and apparel chains warned about their outlooks, and cellphone maker Nokia reined in expectations for its results amid what it said was a significant shift in consumer behavior. Other stock indexes ended lower Friday. The S&P 500 sank 4.2% to 873.29, down 6.2% on the week. It was hurt by declines in all its sectors, led by basic materials and financials, off about 6% each. The Nasdaq Composite Index ended down 5% at 1516.85, off 7.9% on the week. The small-stock Russell 2000 fell 7.1% to 456.52, down 9.7% on the week.

For the entire article from THE WALLSTREET JOURNAL click here:

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Economic Indicators

DETROIT is running on empty. General Motors and Ford announced on November 7th that they had burnt their way through a total of nearly $15 billion of their precious spare cash in the third quarter. GM is on course to run out of money early next year; Ford a little later. Chrysler, 80% owned by Cerberus Capital, a private-equity firm, is less open about its suffering. But most people think it is already roadkill. Across American industry, politics and labour, rarely have so many been so united: Detroit needs saving. The carmakers think they need $50 billion of taxpayers’ support to see them through. At a time when the government is throwing more than $1 trillion at the financial system, isn’t that only fair? Indeed, if it saves millions of jobs isn’t it a bargain? You never know, the state’s investment might even turn a profit. Bailing out Detroit would be a bad use of public money. It would be bad in principle, because it would be an open invitation to companies everywhere to apply for aid to survive the recession. Banks qualify for help because the entire economy depends upon their services. They are vulnerable to sudden collapses in confidence that can spread to other banks that are perfectly solvent. A good car company does not face the same threat. And although Detroit employs a network of suppliers, which would suffer if production shuts down, nothing would sap a recovery and job-creating enterprise like locking up badly used resources in poorly performing companies. The United States created Chapter 11 precisely to help companies that need protection from their creditors while they restructure their liabilities and winnow out the good business from the bad. If the North American businesses of GM and Ford filed for Chapter 11, their activities elsewhere would be largely unaffected. Even in North America, their businesses could continue to make vehicles as they shed costs and renegotiated contracts. That is an unpopular message. It is almost certain to be ignored by Congress, which is itching to “save jobs” and to counter the public-relations disaster of bailing out Wall Street. If the state is determined to keep the industry out of Chapter 11, it should set up a special fund and demand preferred equity to deter shareholders in other industries from asking for money. But it would still do better to let the car firms fail.

For the entire articel from the ECONOMIST click here:

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International Corner

The eurozone has fallen into its first recession, official figures showed on Friday. The decline came even before the global financial market crisis worsened in October, adding to fears of worse to come. Gross domestic product in the 15-country region contracted by 0.2 per cent in the three months to September after a similar drop in the previous quarter. Italy joined Germany and Ireland in reporting that it was in technical recession, defined as two quarters of declining GDP. Underlining the scale of the global turmoil on Europe’s biggest economies, it emerged that General Motors’ Adam Opel unit was seeking loan guarantees from the German federal government and four states where it has plants to protect its business from its US parent’s worsening finances. The European Central Bank is expected to cut its main interest rate again next month from 3.25 per cent, after already cutting by half a percentage point twice in a month. Marco Annunziata, chief economist at Unicredit, said the eurozone was in recession in July when the ECB raised rates to a seven-year high of 4.25 per cent.

For the entire article from the FINANCIAL TIMES click here:

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Thought for the Week

FROM THE ECONOMIST

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Contact Us

LJL Funding, LLC the investment manager of the LJL Secured High Yield Income Fund I, LLC, offers you (the investor) an opportunity to invest in (a pool of) real estate secured trust deeds through the LJL Secured High Yield Income Fund I, LLC.

The LJL Secured High Yield Income Fund offers you a high-performance investment, managed by seasoned professionals in a fund with assets that are secured by real estate at loan-to value ratios not exceeding 60% at the date of the loan (based upon the lower of the appraised value or the 30-day sale value as determined by a Broker Price Opinion).

The benefits of investing in our fund include:

Diversification - Your investment risk is spread over multiple loans.
Investment Performance - Anticipated high yields (10% +, but past performance does not guarantee future results)
Fully Invested - Your investment remains fully invested at all times.
Compound Interest - You have the ability to reinvest some or all of your monthly interest thus taking advantage of the benefits of compounding the return.

Investor Qualifications:

Investors have to be bona fide California residents or foreign nationals living abroad.
Investors must have a net worth (excluding home and automobiles) of at least $250,000 and an annual income of at least $65,000 or a net worth of $500,000 excluding home and automobiles)

If you are interested in adding a high yield mortgage fund to your portfolio, or if you are looking to turn your 401k or pension funds into high yield investments, please contact us today and we can help get you on your way to higher returns.

Jim Chung

Senior Vice President
(West Coast)

(949) 351-8747 Mobile
JChung@LJLFunding.com

LJL Funding, LLC

8880 Rio San Diego Dr #500

San Diego, CA 92108

888-456-0246

www.LJLFunding.com

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