Brinker Capital, a leading investment management firm, released results of the second quarter’s Brinker Barometer, a gauge of financial advisor confidence and sentiment regarding the economy, retirement savings, investing and market performance.

"In Q2, we continued to see some of the major thematic concerns expressed to us by financial advisors in Q1," noted John Coyne, President of Brinker Capital. "A primary concern we’ve seen emerge from quarter to quarter is general dissatisfaction with the manner in which the federal government is handling the economic crisis. However, in the second quarter, inflationary fears have risen close to the top of the major concerns list, with 69 percent of advisors indicating ‘moderate’ or ‘high’ concerns that the US will enter a period of prolonged inflation, and 66 percent of advisors saying they have already discussed portfolio strategies with their clients in anticipation of a possible inflationary period."

Among some of the Brinker Barometer other findings:

Economic Optimism Split

Asked to rank on a 1-5 scale, with five being the highest, their level of optimism that the US economy will significantly improve by year-end 2009, advisors appear to be split almost evenly on their responses. Twenty-four percent ranked their optimism as a ‘4,’ and 27% as ‘2.’ Not surprisingly, the majority of advisors are taking a wait-and-see approach, with 41% responding with a ‘3.’

Endowment Model Still Finds Favor

Despite criticism leveled at some of the major schools’ 2008 endowment investment performance, most advisors still believe in the ‘individual investor’ version of the endowment model, in which clients’ assets are allocated across all asset classes. Fully 90% of respondents said they would recommend this version of the endowment model to their clients.

Nothing to Fear but Fear Itself

When asked to rank their clients’ greatest concerns as of the second half of 2009, advisors overwhelmingly (70%) chose "greater chance they’ll outlive their money." Among some of the other major client concerns, respondents selected "retirement has been placed on hold indefinitely" (61%), "will have to work in retirement" (61%), "assets will continue to be eroded by poor market performance (61%), and "will have to re-enter the workforce to make ends meet" (40%).

For perspective, advisors were asked to rank their greatest concerns, to which they responded with "client losses" (66%), "client anger" (31%), "may have to postpone retirement indefinitely" (26.%).

Washington Under Fire

Financial advisors continue to be critical of the Obama Administration’s policies and general effectiveness in righting the economy. In a series of questions related to their views on Washington, respondents indicated as follows:

Which of the Obama Administration policies do you consider to be more effective?

- Domestic (23%)

- Foreign (13%)

- Neither (64%)

Do you think the economic stimulus plan is working?

- Yes (39%)

- No (61%)

Do you think the stimulus plan has any chance of delivering on its promise?

- Yes (32%)

- No (68%)