The LJL Secured High Yield Income

The LJL Secured High Yield Income Fund I, LLC

annualized return to investors as of 6/21/2009 was 9.14%

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

Is This Bull Cyclical or Secular? Signs Suggest Stocks' Surge Is Blip Within a Bear; Still, There's Opportunity

Mortgage rates fall back from 7-month high Average rate on 30-year fixed-rate home loans now at 5.38 percent

Housing Recovery Moving 'Distressingly Slow'

Wall Street posts losing week

Economic News Will Dominate Week

Dollar Falls Most Against Yen in Month on Fed Rate Outlook

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President's Summary

Previously we commented on the fact that a long term buy and hold strategy in the stock market may not have been the wisest of decisions because of the significantly long periods of sideways price movement clearly illustrated in the chart below. The boom of the roaring 20’s that followed WWI; the three decades boom time following WWII and the 80’s and 90’s technology boom were all interrupted by periods of sideways price movements each lasting between 13 and 16 years. An argument can be made that we are in one of those sideway periods that started with the implosion of the dot com bubble in 2001, during which time we enjoyed a brief respite thanks to the Fed created cheap and Congress mandated (forcing banks to make mortgages available to people who could not afford it) easily available credit essentially based upon real estate. We are now experiencing a sluggish sideways to moderately down recovery in the housing market; a tired looking stock market; more optimistic consumers without jobs and an economic system requiring an overhaul that in itself could put a stranglehold on future growth reminiscent of the Sarbannes Oxlee chokehold over public companies. If we are indeed in one of those long term sideways cycles we may well see a recovery in 2014 to 2017 and the challenge would be to identify the theme for the next major bull market (previous themes were post WWI and WWII spending to rebuild the world and the technology revolution). In the sideways scenario lasting for another couple of years investors would be wise to focus on secured investments that would yield consistently high yields with low volatility – THE LJL SECURED HIGH YIELD INCOME FUND.

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Investor News

Many investors are now calling the rebound in stocks since early March the start of a new bull market. But it could be only a temporary respite from a longer-term bear market dating back to the beginning of this decade. If the market is poised for a multiyear run, investors can be more aggressive about diving into stocks. If the bear market will regain its grip on stocks and send prices lower again, investors need to be cautious. Historical data and the still struggling economy seem to point to the latter case, called a cyclical bull market in a secular bear market. For now, stocks are fully in bull-market territory, even if it doesn't feel that way given the losses that many investors are still nursing. In late 2001, Ned Davis Research, a market analysis and money-management firm, raised the idea that stocks had entered a secular bear market, a long period of flat or declining stocks. That idea gained traction last autumn as stocks fell below levels of a decade ago. Ned Davis considers this the fourth secular bear market since 1900. The last one, from 1966 to 1982, ended when the Federal Reserve moved to aggressively crush inflation. These "secular" cycles run for long periods; secular bull markets have lasted from six to 24 years and bear markets 13 to 16 years. During a secular bull market, the cyclical, or shorter, bull markets within them gained 110% on average and lasted nearly three years. Within secular bear markets, however, the gains in cyclical bull markets averaged 64% and generally were over within a year and a half.

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

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Interest Rates

Rates for 30-year home loans fell back this week after soaring to the highest level in seven months a week earlier. The average rate for a 30-year fixed mortgage was 5.38 percent this week, down from 5.59 percent a week earlier, mortgage company Freddie Mac said. Rates had risen for three consecutive weeks after yields on long-term government debt, which are closely tied to mortgages rates, had been climbing as investors worried that the huge surplus of government debt hitting the market could trigger inflation. But data released Wednesday suggested that inflation remains largely in check, and the yield on the 10-year Treasury note has fallen back from an 8-month high of 4.01 percent reached last week. Though there are signs that the troubled U.S. housing market is beginning to stabilize, higher rates could threaten or slow down any recovery, since borrowers would be able to borrow less money and might decide to hold off on their purchases. The three-week run-up in rates, "is starting to slow homebuyer demand, at least temporarily," Frank Nothaft, Freddie Mac's chief economist, said in a statement. Mortgage applications for home purchases fell 3.5 percent for the week ending June 12, according to the Mortgage Bankers Association, while refinancing applications were down 23 percent from a week earlier.

For the entire article from MSNBC click here:

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Real Estate

A "distressingly slow" U.S. housing recovery, with inflation-adjusted home values expected to decline over the next five years, makes it unlikely that housing wealth will drive consumer spending in the next decade, a Reuters/University of Michigan survey found. Consumers are apt to maintain their renewed emphasis on savings and paring debt, Richard Curtin, director of the survey, said in a June home price update Friday. Housing wealth changes have a lagged impact on spending, and the influence of declines seen in 2008 will depress growth in consumer spending in 2009 and 2010, the survey said. "To be sure, refinancing has reduced the burden of mortgage payments, giving consumers more discretionary income, but the refinancing impact on spending will fade as mortgage rates increase," Curtin said. "Moreover, conventional refinancing is largely limited to consumers whose home is worth about 20 percent more than their current outstanding mortgage." The pool of those homeowners is fast shrinking with each month that home prices sink. On average, home prices nationally have slumped by more than 32 percent from mid-2006 highs, based on Standard & Poor's/Case-Shiller indexes. Sixty percent of homeowners reported home price declines in the second quarter Reuters/University of Michigan surveys. The share of those reporting losses was greatest in the West, at 77 percent, and least in the South, at 51 percent. Some signs of sentiment improvement emerged in the second quarter. Just 22 percent of those surveyed expected price declines in the year ahead, the lowest share since 2007. The share of homeowners reporting price declines in the past year and expected further erosion in the year ahead fell to 28 percent in the second quarter from 35 percent in the first quarter and 43 percent a year ago. "Declines in prices have prompted consumers to view home buying conditions much more favorably, but those same price declines have prompted the least favorable assessments of home selling conditions ever recorded," Curtin said. Most home buyers are also sellers. As a result, many potential transactions are thwarted because the reluctance to sell at a "loss" is seen as greater than the advantage of the buying at a reduced price, he said.

For the entire article from CNBC click here:

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Stock Market

US stocks were mixed on Friday but posted a losing week for only the third time since the lows of March as economic data and earnings reports suggested hopes that the recession will soon be over are premature. Equities began the week on a negative footing with commodities continuing to fall from their highs of the previous week and Wall Street adjusting to some news that was slightly more negative than recent positive data. Tobias Levkovich, chief US equity strategist at Citigroup, said most sentiment gauges suggested that: “The fear that gripped the investment community three months ago has dissipated in almost dramatic fashion. However, it is also fair to say that the mood has not turned truly bullish either as economic worries still abound.” He added that assuming stock and bond prices end the year at current levels, the relative performance swing would be nearly as sharp as the one experienced in 1933 following the 1932 swoon in stock prices.

For the entire article from THE FINANCIAL TIMES click here:

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Economic Indicators

Economic news will dominate as investors stand by for the latest reports on housing, the consumer and the gross domestic product. The final figure for the first quarter GDP is due on Thursday. Economists expect the economy to contract sharply, by 5.7%. The CEO of Fusion IQ says the GDP will be weak for several quarters. Investors are hoping the consumer will show new signs of improvement, with the personal spending report and the Michigan Sentiment Index both due on Thursday. Personal spending likely rose, just slightly, in May. New and existing home sales reports will be on tap in the week ahead. Economists expect both reports to show a small increase in sales for May. Homebuilders KBHome and Lennar are set to report earnings. KBHome's loss is expected to narrow significantly to 64 cents a share, after reporting a loss of $3.30 for the year-ago period. Beyond the housing sector, a slew of retailers are on deck, including Nike Bed, Bath & Beyond, Walgreen and Finish Line.

For the entire article from FORBES click here:

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International Corner

The dollar dropped the most versus the yen in a month as traders pared bets that the Federal Reserve will increase its target lending rate, making U.S. assets less attractive. “The Fed will try to tell the market that they won’t withdraw monetary stimulus unless they see a sustained recovery,” said Alan Kabbani, a senior currency trader at Wachovia Corp. in Charlotte, North Carolina. The dollar fell 2.2 percent this week to 96.27 yen, from 98.43 yen on June 12. It was the biggest decrease since the five days ended May 15, when the greenback slid 3.3 percent. The yen gained 2.7 percent to 134.18 per euro from 137.89 a week earlier. The dollar appreciated 0.6 percent to $1.3937 versus the euro from $1.4016. Interest-rate futures indicated a 44 percent chance the central bank will boost its target rate to at least 0.5 percent by December, down from 55 percent odds a week ago.

For the entire article from BLOOMBERG 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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