Good afternoon, TSPwire Tactical Investor!

Stocks finished little changed afte4r a wild week marked by a big interest rate cut by the Federal Reserve. Indexes posted gains Friday morning after the White House unveiled a $17.4 billion rescue plan for Detroit car makers that will stave off bankruptcy for now. But indexes pulled back to swing between gains and losses though much of recession.

The back-and-forth trading Friday underscored a theme that echoed all week. Most investors acknowledge the need for government and central banks to intervene to bolster the global economy. However, as specific proposals surface, market participants start thinking about the reasons for the government moves - the recession and grim outlook for months to come.

With less than two weeks to go in the year, the Standard and Poor 500 index (C Fund) is down 40% in 2008, on track to be the worst year since 1931.

Oil futures for January delivery fell for a sixth consecutive day down 6.5% to $33.87 a barrel in New York (27% down for the week). At the same time Euro fell against dollar and yen Friday, reversing much of its gains in the wake of the Federal Reserve's rate cut Tuesday.

After stocks have already fallen off the cliff across the board, plunging 48.5% since peaking in late 2007, we are facing once in a life-time opportunity to buy stock funds at incredibly discounted prices. This week we also decided to move some of our funds into small-cap stock index. Small caps stocks are very well positioned to benefit from the low interest rates and stronger dollar. We would like to set our new allocation at 25% S Fund, 25% C Fund and 50% I Fund.

P.S. Now is a also a one of the best times to refinance mortgages. Freddie Mac's survey shows average rate for 30-year fixed mortgage to be at 5.19% - the lowest (!!!) rate level since 1970s.