The LJL Secured High Yield Income

The LJL Secured High Yield Income Fund I, LLC

annualized return to investors as of 5/12/2009 was 9.12%

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

The $1.8 Trillion Question: Inflation Or Deflation?

Citi Bond Sale Shows Strength

Treasury Dept. is giving 'cash-for-keys'

Week Ahead: Stocks Could Be in for Choppy Seas

Economists Foresee Protracted Recovery

German hopes stir after record plunge

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President's Summary

The bulls on Wall Street took a breather, well deserved after running for six weeks, but the rest of the economy continued, albeit at a snail’s pace, to absorb bad but better than expected news. The Chrysler bankruptcy and a likely filing by GM with the resulting closures of thousands of dealerships are anticipated to cause pain, but not the end of the world. On the real estate front commercial real estate seems to be falling off a cliff with residential now only rolling down a steep hill. Foreclosures are up, as can be expected after an imposed moratorium, but are being handled in a fairly orderly fashion with the Obama administration even giving incentives for a “cash-for-keys” program designed to facilitate an orderly, quick and less expensive way to reach what in many cases are the inevitable end result. The bursting of the housing price bubble and the implosion of the subprime mortgage backed securities market was the catalyst for the frozen credit markets that nearly brought the world economy to its knees. Without the credit markets regaining full functionality there should not be any sustained recovery. During the week under review the thawing of the credit markets accelerated with the placement of $2 Billion (oversubscribed) bonds by Citigroup without any government guarantees. One of the significant measures of the health of the credit market the TED Spread ( spread between 3-month Treasuries and 3-month LIBOR) narrowed to 62 basis points, well down from nearly 500 basis point at the height of the crisis and fast approaching the normal range of between 35 and 50 basis points.

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Investor News

The federal government's budget deficit is alarmingly large and has the potential to wreak further havoc on the economy. The markets face the need to finance a record $1.8 trillion government budget deficit next year. That's 13% of our gross domestic product and roughly four times the $454.7 billion deficit incurred last year. This task appears to be doable since the Treasury sold or auctioned off more than $1 trillion in new bills, notes and bonds late in 2008. As interest rates did not spike, the stock market became encouraged enough to rebound from the March 9 lows. The Bernanke-Geithner printing presses, massive guarantees and subsidization of Wall Street removed the fear of a systemic breakdown and proved there was no limit to the bailout funds for financial intermediaries. Today, the unknown future perplexes investors and traders alike. Is it to be a recovery shaped like the letter V, as folks like the forecasters at JPMorgan and the ECRI Institute would have it, or the more banal U, which will take longer, or the terrible L-shape, describing an extended period of little or no growth in the economy? At the core of the quandary is the mighty showdown battle between two forces that will decide the issue; the deflation of an L or the inflation of a V. Deflation means we may have had our rally and stocks will now back and fill, possibly rising to the 10,000 mark on the Dow. That still leaves from today's level another 75% move to get back to the peak of 14,100. It isn't likely under deflation or inflation is what Croesus deems. It's hard to predict inflation because in the short run, higher interest rates shouldn't be a problem because industrial production is down, retail sales are soft, unemployment headed higher and the Consumer Price Index reading was down year-over-year.

For the entire article from FORBES click here:

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Interest Rates

Citigroup stood on its own two feet Friday and sold $2 billion of investment-grade bonds without the backing of the federal government. This is the first time the financial institution has sought financing away from the protection of the Federal Deposit Insurance Corp.'s Temporary Liquidity Guarantee program begun in November. Demand was strong, with orders exceeding $6 billion, according to one person familiar with the deal. The Citi offering was the latest in a string of non-FDIC bond offerings from financial institutions recently tested by the government to determine how well they could stand up to further deterioration in the economy. Selling long-term debt without FDIC backing as well as plugging any capital shortfalls found under the stress tests are prerequisites for repaying government funds received under the Troubled Asset Relief Program, or TARP. Citi said the offering isn't an indication it is looking to repay TARP funds, however. "It's more a signal of strength to the market," one Citi official said.

For the entire article from THE WALL STREET click here:

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Real Estate

When all else fails, the Treasury Department is now willing to cough up cash to get homeowners to move on and to get loan servicers to forgive mortgage debt. The new initiatives are part of the government's Making Home Affordable program. Under the original program, unveiled earlier this year, homeowners could be eligible for loan adjustments or refinancings if they meet several criteria: the home must be their primary residence, for example, and the mortgage balance must be no more than $729,750. Even then, however, mortgage help is not assured. The homeowners may still not be able to afford reduced monthly mortgage payments of 31% of income. And to protect the investors who own the mortgage, the value of a modified loan still has to be greater than the value of what would be recovered in foreclosure. In these cases, lenders first consider a short sale, a deal in which the home is sold for less than the mortgage balance, and loan servicers may forgive the difference. If that is unsuccessful, the final step is a "deed in lieu of foreclosure," when borrowers voluntarily forfeit the deed and the debt may be erased. Under the new initiatives, for short sales and deeds in lieu, borrowers will get up to $1,500 to assist with relocation expenses. Treasury will also pay the servicers $1,000 to complete a short sale or deed in lieu. A deed in lieu can be the least painful way of ending a mortgage default nightmare, according to Pamela Simmons, a real estate attorney in California.

For the entire article from CNNMONEY click here:

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Stock Market

Expect choppy seas for stocks in the coming week. For the most part, traders say the market should bump along with a downward bias while it establishes a new trading range. The lack of economic news and earnings reports in the coming week leaves a news vacuum, and the market will be looking for catalysts. Minutes from the last Fed meeting, and the Fed's economic forecast are released Wednesday. Treasury Secretary Tim Geithner testifies Wednesday before Congress on the TARP, and there are a few economic reports, including housing starts and leading indicators. Dow components Home Depot and Hewlett-Packard are among the few companies reporting earnings in the week ahead. Stocks staged their worst weekly decline since March 6. The Dow was down 306 points, or 3.6 percent to 8268, and the S&P 500 fell 46 points, nearly 5 percent, to 882. The Nasdaq had its first down week in 10, losing 3.4 percent to 1680.

For the entire article from CNBC click here:

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Economic Indicators

Economists in the latest Wall Street Journal survey see an end to the recession by autumn, but say it will take years for the economy to fully recover. On average, the 52 economists who participated in the survey project that the recession will end in August. They expect gross domestic product to contract 1.4% at a seasonally adjusted annualized pace in the current quarter, compared with the 6.1% drop recorded in the first quarter. Slow growth is expected to return by the third quarter, with the economy expanding more than 2% in the first half of 2010. The depth of the downturn means it will take years to eat up the slack created by the recession. Nearly half of the economists said it will take three to four years to close the output gap, while more than a quarter say it will take five to six years.

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

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International Corner

The US and British recessions have left their mark on shopping centres and high streets. Germany’s has been visible at factories on short-time working – in the lightly loaded industrial barges on the Rhine and the lines of unsold luxury cars at the motor plants. First-quarter gross domestic product figures yesterday confirmed what economists had long suspected: Germany, which has relied heavily on exports of industrial goods to power its growth, had taken a much bigger blow from the slump in global demand than other big European economies. German GDP shrank by 3.8 per cent compared with the final three months of 2008 – the largest quarterly fall since comparable statistics were first compiled in 1970. Weak exports and investment spending explained much of the slump, according to the federal statistics office, although it gave no breakdown of the figures. The far grimmer-than-expected news increases the pressure on Angela Merkel, the German chancellor, who faces elections later this year. Unemployment figures are only just starting to reflect the severity of the recession in the past half year. But it may not be too long before the German economy shows signs of recovering. Forward-looking surveys – such as the Ifo business confidence index – suggest that the pace at which the economy is contracting has already slowed. The first quarter “is water under the bridge”, said Dirk Schumacher, an economist at Goldman Sachs in Frankfurt. “It doesn’t take anything away from the rebound that we have seen in the indicators.” Latest industrial orders data – for March – showed a month-on-month increase, and such trends could gain momentum as “green shoots” emerge around the world. Chris Williamson, chief economist at Markit, the information group, reports a sharp increase in the global “orders-to-inventories ratio” index compiled by his company, which should lead to companies stepping up production. “Germany, as the world’s biggest exporter, should benefit more than anyone else from that,” he says. Germany should also start to feel the effects of the government’s stimulus programmes soon.

For the entire article from THE FINANCIAL TIMES click here:

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Thought for the Week

FROM PAT OLIPHANT

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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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