Economic Commentary Highlights...

• Few, if any, of the traditional harbingers of recession are in place today.
  

• Although this week’s economic calendar in the United States is chock full of data for May and June, investors are likely to be looking for more as the week draws to a close ahead of the long holiday weekend in the United States.

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Lincoln Savings Bank and LSB Financial are pleased to provide the above Economic Commentary for the week of June 27, 2011. The commentary is prepared by LPL FINANCIAL RESEARCH, the broker-dealer partner for Lincoln Savings Bank and LSB Financial. The above commentary and others like it can be found at www.mylsb.com/investments/commentary.aspx

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This information is being provided by Lincoln Savings Bank (LSB) / LSB Financial, an Iowa-based institution devoted to providing complete financial services since 1902. www.mylsb.com

Market Commentary Highlights...

• The so-called earnings “pre-announcement season” is upon us.
  

• The current ratio of negative-to-positive preannouncements is 2.3, above the historical average pre-announcement ratio of 2.1; historically this 2.3 ratio has been followed by a gain of about 2% in the S&P 500 during the ensuing earnings season.

• While the above average pre-announcement ratio may be a small positive for the earnings season once it gets underway, the next few weeks may continue to feature negative pre-announcements and modest losses for the stock market.

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Lincoln Savings Bank and LSB Financial are pleased to provide the above Economic Commentary for the week of June 27, 2011. The commentary is prepared by LPL FINANCIAL RESEARCH, the broker-dealer partner for Lincoln Savings Bank and LSB Financial. The above commentary and others like it can be found at www.mylsb.com/investments/commentary.aspx

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This information is being provided by Lincoln Savings Bank (LSB) / LSB Financial, an Iowa-based institution devoted to providing complete financial services since 1902. www.mylsb.com

In order for us to better serve our customers a number of our ATM's will be undergoing renovations over the next few weeks. The changes will allow customers with impairments to their vision to more easily use the machines.

Below is the list of ATM's that will be undergoing improvements and the dates that they will be out of order. Please take note of your local ATM location as to avoid any inconvenience for yourself.

Reinbeck – July 6
Waverly – July 7
Greene – July 11
Grinnell (Branch only) – July 13
Aplington – July 19
Tama – July 21
Hudson – July 26
Allison – July 28

The following locations will have a full ATM replacement:
CFDT – August 4
Waterloo – August 9
CFIP – August 11
Grinnell (college location only) – August 16

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This information is being provided by Lincoln Savings Bank (LSB) / LSB Financial, an Iowa-based institution devoted to providing complete financial services since 1902. www.MyLSB.com

Economic Commentary Highlights...

• The Fed’s policymaking arm, the Federal Open Market Committee (FOMC), meets to set policy this week.
  

• We examine what might cause the FOMC to embark on another round of quantitative easing.

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Lincoln Savings Bank and LSB Financial are pleased to provide the above Economic Commentary for the week of June 20, 2011. The commentary is prepared by LPL FINANCIAL RESEARCH, the broker-dealer partner for Lincoln Savings Bank and LSB Financial. The above commentary and others like it can be found at www.mylsb.com/investments/commentary.aspx

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This information is being provided by Lincoln Savings Bank (LSB) / LSB Financial, an Iowa-based institution devoted to providing complete financial services since 1902. www.mylsb.com

Market Commentary Highlights...

• Europe’s Greece fire has been burning for well over a year despite attempts by the ECB and IMF to put it out. Investors are feeling the heat of the Greece fire, as it has added to the pressures on markets in recent weeks. However, after having spilled over into some European banks, it is highly unlikely to spread to the rest of the world in a dangerous fashion and trigger another global financial crisis.
  

• While the events of 2008 are fresh in market participants’ minds, and it is often easy to draw comparisons to that financial crisis, there are other historical parallels — such as Argentina’s default in late 2001 — that present much less dire comparisons.

• Many factors are likely to avoid a financial crisis stemming from Greece’s financial problems. European banks have already cut their exposure to the troubled peripheral European nations in half, a rescue package is emerging that avoids restructuring until banks are further braced for it, and money market funds are insignificantly exposed to European lenders most at risk of losses on Greek debt.

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Lincoln Savings Bank and LSB Financial are pleased to provide the above Economic Commentary for the week of June 20, 2011. The commentary is prepared by LPL FINANCIAL RESEARCH, the broker-dealer partner for Lincoln Savings Bank and LSB Financial. The above commentary and others like it can be found at www.mylsb.com/investments/commentary.aspx

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This information is being provided by Lincoln Savings Bank (LSB) / LSB Financial, an Iowa-based institution devoted to providing complete financial services since 1902. www.mylsb.com

Economic Commentary Highlights...

• Over the past four weeks, only 25% of economic reports in the United States beat expectations.
  

• This week, Fed Chairman Bernanke is likely to continue to prod Congress to put the United States on a sounder fiscal footing.

• One of the under appreciated stories in the economy over the past several years has been the recovery in consumer net worth.

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Lincoln Savings Bank and LSB Financial are pleased to provide the above Economic Commentary for the week of June 13, 2011. The commentary is prepared by LPL FINANCIAL RESEARCH, the broker-dealer partner for Lincoln Savings Bank and LSB Financial. The above commentary and others like it can be found at www.mylsb.com/investments/commentary.aspx

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This information is being provided by Lincoln Savings Bank (LSB) / LSB Financial, an Iowa-based institution devoted to providing complete financial services since 1902. www.mylsb.com

Market Commentary Highlights...

• The attraction of a summer day at the ballpark endures, but it is no longer the most common topic of conversation during these early days of summer. The boys of summer are taking a backseat to the Dogs of the Dow.
  

• After six weeks of market declines, totaling almost 7%, as measured by both the Dow and the S&P 500, we believe we are the middle innings of this pullback with a few left to go.

• The good news is that we do not expect this pullback to extend into extra innings and, despite the tough season, stocks are likely to have a winning year.

View the entire economic Commentary (pdf format)

Lincoln Savings Bank and LSB Financial are pleased to provide the above Economic Commentary for the week of June 13, 2011. The commentary is prepared by LPL FINANCIAL RESEARCH, the broker-dealer partner for Lincoln Savings Bank and LSB Financial. The above commentary and others like it can be found at www.mylsb.com/investments/commentary.aspx

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This information is being provided by Lincoln Savings Bank (LSB) / LSB Financial, an Iowa-based institution devoted to providing complete financial services since 1902. www.mylsb.com

Economic Commentary Highlights...

• Market participants will have to look elsewhere for direction this week amid a quiet week for economic reports in the United States.
  

• On balance, the backdrop for hiring remains supportive for modest job creation in the coming months.

• There are several key reports on the Japanese economy for May due out this week that are expected to show that the pace of recovery in Japan hastened in May.

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Lincoln Savings Bank and LSB Financial are pleased to provide the above Economic Commentary for the week of June 6, 2011. The commentary is prepared by LPL FINANCIAL RESEARCH, the broker-dealer partner for Lincoln Savings Bank and LSB Financial. The above commentary and others like it can be found at www.mylsb.com/investments/commentary.aspx

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This information is being provided by Lincoln Savings Bank (LSB) / LSB Financial, an Iowa-based institution devoted to providing complete financial services since 1902. www.mylsb.com

Market Commentary Highlights...

• Last week’s reading on the ISM Index confirmed that the economy has entered a period of slower growth and stock market performance is likely to be modest and volatile in the months ahead. However, we do not envision a return to recession or a bear market for stocks.
  

• While there is no cure for the summertime blues that accompany slow and uneven growth in the economy, there is portfolio medicine that may buffer the volatility.

• While stocks should be considered as a component of a diversified portfolio, other asset classes such as high-yield bonds and commodities asset classes may offer better prospects and valuable diversification in the near future.

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Lincoln Savings Bank and LSB Financial are pleased to provide the above Economic Commentary for the week of June 6, 2011. The commentary is prepared by LPL FINANCIAL RESEARCH, the broker-dealer partner for Lincoln Savings Bank and LSB Financial. The above commentary and others like it can be found at www.mylsb.com/investments/commentary.aspx

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This information is being provided by Lincoln Savings Bank (LSB) / LSB Financial, an Iowa-based institution devoted to providing complete financial services since 1902. www.mylsb.com

Economic Commentary Highlights...

• The economic data for April and May continues to be impacted by poor weather and the Japanese earthquake. Is the weak economic data a signal or just noise?
  

• The end of QE2 and its impact on the economy.

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Lincoln Savings Bank and LSB Financial are pleased to provide the above Economic Commentary for the week of May 23, 2011. The commentary is prepared by LPL FINANCIAL RESEARCH, the broker-dealer partner for Lincoln Savings Bank and LSB Financial. The above commentary and others like it can be found at www.mylsb.com/investments/commentary.aspx

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This information is being provided by Lincoln Savings Bank (LSB) / LSB Financial, an Iowa-based institution devoted to providing complete financial services since 1902. www.mylsb.com

Market Commentary Highlights...

• As the grand ocean liner the QE2 embarked on her final voyage, she ran aground on a sandbank near the Isle of Wight.
  

• Might the markets run aground on unseen risks as the Fed’s flagship QE2 program comes to its finish at the end of June?

• We do not think so, the economy is much better equipped to handle unseen risks than after the end of QE1.

• The real issue for the post-QE2 environment may be the financial position of the United States and the outlook for fiscal, rather than monetary, policy.
  

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Lincoln Savings Bank and LSB Financial are pleased to provide the above Economic Commentary for the week of May 31, 2011. The commentary is prepared by LPL FINANCIAL RESEARCH, the broker-dealer partner for Lincoln Savings Bank and LSB Financial. The above commentary and others like it can be found at www.mylsb.com/investments/commentary.aspx

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This information is being provided by Lincoln Savings Bank (LSB) / LSB Financial, an Iowa-based institution devoted to providing complete financial services since 1902. www.mylsb.com