A step-by-step guide to asset allocation

Your overall asset allocation needs to reflect your future capital or income needs, the timescales before those capital sums are required, or the level of income sought, and the amount of risk you can tolerate.

No two investors’ allocations will be the same but, as a general rule, the more assets you can add to a portfolio using low-cost funds, the lower the volatility and the smoother the returns.

We have shown some typical asset allocations for different objectives, below, and examples of the fund holdings used to achieve them – for illustration purposes only.
1. Set your
financial planning objectives

Financial planning objectives can include providing additional pension income (see also Part One of this series at www.ft.com/diyfinancialplanning), paying for children’s education or property deposits, or meeting care fees – so you may need to use different asset allocations at different times, to match these liabilities.

For example, building up a lump sum over 20 years will require a higher allocation to long-term growth investments, such as equities. However, providing income will require equities, high-yield bonds and gilts.

“It’s all about asking: what is your objective,” says Matthew Merritt, head of investments strategy unit at Insight Investment. “Is it achieving a certain return, or matching a liability stream? Liability-driven investment is the same for an institution as it is for a private investor getting a kid through college.”
2. Set your strategic allocation

A strategic asset allocation is simply the mix of assets to be held in a portfolio for the term of the investment – to achieve a target level of risk and return.

For example, a simple strategic allocation for a 20- year term might be 50 per cent equities, 25 per cent bonds, 15 per cent cash and 5 per cent in both commodities and hedge funds. But, depending on how actively you want to manage your portfolio, you can also use tactical asset allocations in the short term, to exploit temporary economic or market conditions and boost returns. For example, a 5 per cent allocation to commodities may be increased in times of constrained supply – but revert to the normal strategic level once short-term profits are achieved.
3. Add assets to build up your portfolio

If you already hold shares and equity funds, you can simply buy exposure to the other assets needed to achieve your target allocation, and geographical spread. By adding assets with low correlations to your existing holdings – such as bond funds and exchange traded commodities – you will reduce overall portfolio volatility and generate smoother returns.

This can be done at low cost through a discount broker service, for a flat fee of £10-12 per share or fund added, with no initial or administration charge on the funds.

Over the long term, adding assets can enhance returns. For example, a diversified portfolio returning a steady 5 per cent a year will outperform a less well diversified portfolio returning 3 per cent one year and 7 per cent the next – even though the average annual return is the same.

“Open yourself up to broadest opportunity set that you can,” advises Merritt. “It’s not just about equity, government bonds, and property. Consider absolute return-style vehicles that have a different risk/return trade-off, commodities, and other opportunistic investments. Think about diversification not just in terms of asset class and geography but also in the way you manage money. Give money to different fund managers – some active, some passive.”
4. Monitor your asset allocation regularly

An asset allocation may need to be changed over time, for two reasons: rises in the value of assets can increase the volatility of a portfolio, and age can reduce the risk tolerance of an investor – especially in the years before retirement.

To ensure higher-risk assets do not dominate a portfolio, make sure you rebalance your portfolio annually, or when any one asset rises in value by, say, 20 per cent.

Vanguard, the fund manager, has found that, over the long term, a portfolio split 60:40 between equities and bonds but never rebalanced would have gradually drifted towards a more volatile split of 90:10 – because shares historically outperformed bonds.
5. Rebalance your portfolio

Rebalancing simply involves selling some assets that have risen in value and reinvesting the proceeds into those assets that have fallen below their target allocation.

For example, a portfolio that starts with £10,000 in equities and £10,000 in bonds may end the year with the equities up 10 per cent and the bonds unchanged – a 5 per cent return overall. So, to rebalance, you sell £500 of equities and buy £500 of bonds. After paying dealing charges of £10 on the two transactions, the portfolio is still split 50:50: £10,490 in equities, £10,490 in bonds.
6. Consider ‘lifestyling’

To ensure market volatility does not reduce your portfolio’s value just before the money is needed – for example, to provide a lump sum – you should consider gradually moving out of higher-risk assets, such as equities, and into lower-risk assets, such as cash and government bonds, before the money is needed.

This process, known as lifestyling, aims to reduce the volatility in a portfolio over a period of time.

For example, investors in their 30s can afford to hold more equities as they can ride out price fluctuations over time – but investors in their 50s cannot afford as much equity exposure as they have less time to recover from sharp falls.

Lifestyling can be carried out manually, by selling risky assets and holding the proceeds as cash or in government bonds (see “Rebalancing” above). Or you can use target date or “lifecycle” funds, which automatically change their asset allocations to accumulate capital gains in the early years and then protect them to deliver a lump sum, or generate income, on a specified target date.

Target-date funds are now offered by fund managers Vanguard and Fidelity, and allow investors to choose a fund with a target date nearest to when they will need to drawdown capital or income.

For example, a 30-year-old planning to retire in 35 years’ time might choose a 2045 fund. However, regulators in the US have expressed concern about the wide variation in performance between funds with the same target date.

Wife wins in court's property shock

A landmark Supreme Court judgment has opened the way for wives to take a share of their husbands' property - even though they owned it before the marriage.

A prominent Auckland family law barrister has described the decision as "shocking", saying the woman has won a huge payout as a result of her performance of domestic chores during the 24-year marriage.

The court says the woman is entitled to almost half of the increased value of the couple's farm, even though her ex-husband inherited it before their marriage.

The long-running dispute case - heard before four different courts - is expected to open the floodgates on a series of similar disputes.

The Supreme Court has agreed with the Court of Appeal the woman is entitled to a 40 per cent share of the increased value of her husband's farm, even though he owned it before their marriage in 1979. They separated in 2003.

The woman argued that as the homemaker, her duties helped her husband focus on developing the farm and, later, a vineyard on the land.

At stake were two properties - the second was inherited by the husband in 1995, during the marriage.

The wife won at Family Court level, but lost in the High Court. For round three, the Court of Appeal said the wife was entitled to almost $560,000 for both properties. Both parties appealed to the Supreme Court - the husband said his wife was not entitled to any of that money; she said she was entitled to more.

"The argument for the wife was that her actions since marriage had freed up the husband to undertake work solely for the benefit of his separate property and that she had prevented the debt from reaching an unsustainable level," the Supreme Court said.

"In addition to looking after the children and managing the household, she had earned over $300,000 from outside employment, all of which she had contributed to the household."

The wife asserted had it not been for her actions the farm would have been sold to ease debt, and neither party would have seen the "spectacular increase" in the value of the property.

Barrister Anthony Grant has described the case as involving "the annihilation by stealth of separate property". He says the case is "shocking" and "a stunner", not necessarily because it was wrongly decided, but because people had not been aware that "indirect contributions" involving something as ordinary as household chores could convert a spouse's separate property into relationship property.

"In a typical marriage where, say, the husband has separate property from an inheritance or a prior relationship he is now liable to lose it if his wife can say that her doing the housework helped him to increase the value of the property. While he was at his desk working on his separate property affairs and his wife was doing the dishes, sweeping the floor, feeding the kids, and so on - she was simultaneously taking the separate property!"

SEC blamed for failing to spot Madoff fraud

Harvey Pitt, the former head of the US Securities and Exchange Commission, on Thursday delivered a measured, but trenchant indictment of his former employer over its “terrible failure” to spot the Ponzi fraud of Bernard Madoff, who on Monday was sentenced to 150 years in jail.

Mr Pitt, who was SEC chairman for 15 months between 2001 and 2002, confirmed that the regulator had been given evidence of alleged wrongdoing by Mr Madoff’s business at various points – in 1992, 1999, 2005 and 2006. “But during [my tenure], there was no indication whatsoever that Madoff was doing something wrong,” he said.

Staff at the regulator, he said, had always “lacked the sophistication and skillset” necessary to do their jobs effectively. The SEC was staffed with too many lawyers and not enough economists and market practioners, said Mr Pitt, himself a former lawyer.

Commenting on the SEC’s future, Mr Pitt said he admired the calibre of US president Barack Obama’s team and was broadly supportive of its desire to reform the regulatory environment. But he said political expediency meant grand plans for new structures – for example to speadhead consumer protection – would crash into existing bodies. “Rather than eliminating the SEC now, there is an effort to make it even less relevant than some think it’s already become,” Mr Pitt said. The result was an “emasculated” SEC.

Mr Pitt resigned from the SEC in November 2002, after a difficult period during which Enron and Worldcom both collapsed. He was seen by critics as having been slow to address the problems of biased equity research on Wall Street.

Speaking on Thursday at the offices of CQS, a London-based hedge fund on whose advisory board he sits, Mr Pitt also laid out his blueprint for the direction he thought regulatory reform should take.

Having spent recent months advising governments on both sides of the Atlantic, in his capacity as chief executive of regulatory consultancy Kalorama Partners, he said current ideas for “extensive and, I believe, invasive regulation” seemed to be directed at “fighting yesterday’s crisis”. “The next crisis, we can be pretty sure, won’t look anything like the last one,” he said.

The answer, Mr Pitt said in a familiar refrain, was to adopt the more principles-based approach that the UK’s Financial Services Authority has traditionally used. “The FSA model is a good model and one that the US would do well to follow,” he said, though the FSA has recently redefined itself, under chairman Lord Turner, as an “outcomes-based” regulator and has moved away from its former “light-touch” style.

Mr Pitt said there were two key principles vital to ensure effective financial regulation. The first was a need for more data to be disclosed by banks and hedge funds to government, though that information should only come back to the markets in aggregate form. In particular, hedge funds should be obliged to disclose potential conflicts of interest, for example if they were simultaneously invested in a company’s equity and debt.

The second was a need for government to have a “residual regulatory authority”, allowing it emergency powers to intervene in the financial system if it saw that by certain measures, such as leverage, the economy was overheating.

Blue Chip founder hit with $11m debt

Blue Chip co-founder Mark Bryers has racked up another debt - this time $11.2 million to Westpac.

The High Court last week awarded summary judgment to Westpac NZ Ltd against Bryers after he guaranteed a company debt.

The judgment, which opens the door for bankruptcy proceedings, is among several already awarded against Bryers, including one for $4m.

So far the head of the failed Blue Chip group has eluded bankruptcy and continues to run a property investment business in Australia.

Citing client confidentiality, Westpac declined to specify the name of the company, the full amount of the debt or whether the bank planned to proceed with bankruptcy proceedings.

Bryers' business partner, Bob Bangerter, was bankrupted in April by Wellington property magnate Bob Jones' company after $398,000 in rent was left unpaid in an Auckland tower block following the Blue Chip collapse.

After a group of Blue Chip-related companies went into liquidation in February last year, thousands of investors were left a combined $80m out of pocket.

Bryers, 51, also faces more than 100 criminal charges brought by the Companies Office and seven charges relating to a lodge he managed on the Whangaparaoa Peninsula.

Folic acid law shock for Hide

MP Rodney Hide warned New Zealand Food Safety Minister Kate Wilkinson against mass medicating bread with folic acid three months ago - a month before the Herald on Sunday broke the story.

Hide, as Minister of Regulatory Reform, said he was "shocked" to learn breadmakers were being forced to add folic acid to all bread and urged Wilkinson - who does not eat bread - to delay the decision. In his April 16 letter, Hide expressed concerns about the lack of choice and potential health risks linked to folic acid.

Ireland and the United Kingdom had recently postponed their plans to force breadmakers to add folic acid because of concerns about links with cancer, he wrote.

"Choice is something that is very important to my party and I had thought to yours ... I don't think the New Zealand public will be happy to find out that there are plans to mass-medicate 4.3 million of them through a product they have no choice but to consume."

Wilkinson, who does not eat bread because she is gluten intolerant, said in a statement she was aware of Rodney Hide's concerns.

"The Prime Minister has sought further advice and we are working to find a suitable solution."

Last week Hide said New Zealand had rejected "the nanny state" in the last election.

"It seems to me the only argument in favour of it is we might upset the Australians which I thought was a plus."

Suicide blasts at Jakarta Ritz, J.W. Marriott kill 9

JAKARTA, Indonesia -- Suicide bombers who checked in as guests smuggled explosives into American luxury hotels in Indonesia's capital and set off a pair of heavy blasts that killed nine people and wounded more than 50, investigators said Friday.

The near-simultaneous bombings ended a four-year lull in terror attacks in the world's most populous Muslim nation. At least 18 foreigners were among the dead and wounded. The blasts at the J.W. Marriott and Ritz-Carlton hotels, located side-by-side in an upscale business district in Jakarta, blew out windows and scattered debris and glass across the street, kicking up a thick plume of smoke. Facades of both hotels were reduced to twisted metal. An Associated Press reporter at the scene saw bodies being shuttled away in police trucks.

Alex Asmasubrata, who was jogging nearby, said he walked into the Marriott before emergency services arrived and

“there were bodies on the ground, one of them had no stomach,” he said. “It was terrible.” Two Australians and a New Zealander were believed to have been killed, but there was confusion about the exact number of victims.

“I have grave concerns for three Australians following the terrorist bombings in Jakarta earlier today,” Australian Prime Minister Kevin Rudd told reporters late Friday. “One of these Australians is an Australian Embassy official. These figures may be the subject of further change.”

An Australian think tank, the Strategic Policy Institute, predicted the Southeast Asian terrorist group Jemaah Islamiyah might launch new attacks just a day before Friday's deadly strike.

A paper released Thursday said tensions in the group's leadership and the release of former members from prison “raise the possibility that splinter factions might now seek to re-energize the movement through violent attacks.”

Indonesian President Susilo Bambang Yudhoyono said the attack was carried out by a “terrorist group” and vowed to arrest the perpetrators. He also suggested a possible link to the national election last week that is expected to hand him another five-year term as president, but he provided no details. Suspicion will fall on the Southeast Asian Islamist militant group Jemaah Islamiyah or its allies. The network is blamed for past attacks in Indonesia, including a 2003 bombing at the Marriott when 12 people died.

“Those who carried out this attack and those who planned it will be arrested and tried according to the law,” a somber-looking Yudhoyono told a news conference.

The Manchester United football team canceled a planned visit to Indonesia. The team had been scheduled to stay at the Ritz on Saturday and Sunday nights for a friendly match against the Indonesian All Stars, the Indonesian Football Association said.

Iran, Russia to Hold Joint Naval Exercise

LONDON, July 19 (IranMania) - Iran and Russia are scheduled to hold a joint maritime exercise in the Caspian Sea on July 28-29, an Iranian official said on Sunday Fars News Agency reported.

Managing Director of Iran's Ports and Shipping Organization Taheri Motlaq said that the maneuver, due to be held in the northern Iranian port city of Bandar-e-Anzali, is aimed at enhancing the safety of transportation in the Caspian Sea.

Taheri Motlaq was quoted by the Islamic republic news agency as saying that the exercise will be held within the framework of international conventions such as those on the prevention of sea pollution.

According to the official, the exercise will be dubbed as "Regional Interaction, Key to Safe and Clean Caspian Sea".

"Over 30 modern vessels and two helicopters will take part in the exercise," he added.

Malaysia 2 Man U 3

MICHAEL OWEN marked his Manchester United debut with a late winner to save his side's blushes in Kuala Lumpur.

Sir Alex Ferguson's men looked like being held to a surprise draw in the opening match of their Far East tour.

Owen, though, had other ideas after coming on as a second-half sub, showing the scoring instinct Ferguson knew he had when he made his shock decision to buy the former Liverpool star last month.

When Zoran Tosic was upended in the penalty area going for a 50-50 challenge, there was Owen to pounce on the loose ball and stroke the Red Devils to victory.

In front of almost 100,000 fans at the Bukit Jalil Stadium, United appeared to be on thir way to a comfortable win as Wayne Rooney and Nani eased them into a two-goal first-half lead.

It was certainly an encouraging hour-long display from Rooney, during which he scored United's first, created the second and came within a couple of inches of chipping home a third.

With Cristiano Ronaldo and Carlos Tevez consigned to the pages of United's history books, Rooney is now the main man at Old Trafford.

True, there will be sterner tests than this for the England man, but on the basis you can only beat the team put in front of you, Rooney did everything asked of him.

His goal was a real poacher's effort.

Darron Gibson crossed after collecting a superb cross-field pass from Anderson, and though Dimitar Berbatov was repelled by Mohammed Farizal Marlias, Rooney was on hand to expertly steer a shot into the top corner.

It was the start of a bad luck story for Berbatov, who twice grazed the Malaysian post with flicked near-post headers and got into plenty of dangerous positions without finding the net.

Twelve months ago, the Bulgarian's arrival triggered the eventual exit of Tevez. Now Owen lies in wait to upset the established order.

Rooney's place is not under threat. When he threaded a superb pass through the home defence, Nani applied the finish and it appeared United would saunter home.

They reckoned without Mohammed Amri Yahyah, one of only two full internationals to start for the Malaysian side, who halved the deficit just before the interval, then levelled eight minutes after the restart.

On both occasions, questions could be asked of the goalkeeper.

Edwin van der Sar had no chance of actually stopping Yahyah's effort but his starting position seemed to be too far from his goal.

If that was a debatable point, there was no doubting Van der Sar's replacement Ben Foster was to blame for the equaliser.

As this is almost certain to be Van der Sar's last season of top-flight football, the pressure is on Foster to prove he is worthy of becoming his successor. This was not a good start.

Trying to control Gibson's backpass, Foster was horrified as the ball cannoned off his shin. Yahyah was quick to react and Foster was unable to prevent the home striker tapping home.

The England keeper was more steady when he needed quick feet to get him out of trouble from a Jonny Evans backpass — but the damage had been done.

In between those two moments, Ferguson made a quadruple substitution.

Owen was among those introduced, with Rooney departing, although not before he had nearly scored again after controlling Paul Scholes' pass and landing a chip just the wrong side of the post.

Owen's first effort as a United player was a miscued volley which bounced harmlessly across the home six-yard area.

His second, typically, proved to be the winner.

United: Van der Sar (Foster 46), O'Shea, Ferdinand (Brown 61), Evans, Evra (Fabio 61), Gibson, Scholes (Tosic 61), Anderson (Giggs 76), Nani, Rooney (Owen 61), Berbatov (Macheda 76).

Goals: Rooney 8, Nani 28, Owen 85

Malaysia XI: Marlias, Mazlizam, Zamani, Zafuan, Asraruddin, Rahim, Rohidan, Kunalan, Yahyah, Indra Putra, Zaquan.

Goals: Yahyah 45, 52

More people moving into Taiwan than moving out

TAIPEI, Taiwan -- More people moved into Taiwan than those who moved out in the first six months of this year, the latest tallies compiled by the Ministry of the Interior (MOI) showed Sunday.

According to the MOI tallies, 47,000 people immigrated to Taiwan or registered their households in Taiwan for the first time in the first six months of this year, while 32,000 people emigrated abroad or moved out of the country.

The northern county of Taipei had the highest rate of net inward immigration among all administrative districts in Taiwan this year, the tallies showed.

The MOI statistics showed that Taipei County had the highest net inward population migration in the first six months of this year, with a figure of 9,843, followed by the outlying island county of Kinmen with 4,659, and Taoyuan County with 4,585.

During the same period, a total of 950,000 people -- 41 in every 1,000 -- migrated around the country, the statistics showed.

Meanwhile, the capital city of Taipei had the highest rate of outward migration among all administrative districts in the country, with a gross out-migration of 7,878 people in the first half of the year.

Taipei City was followed by the central Changhua County with an outward migration of 2,080 people and the southern Kaohsiung County with 1,273 during the same six-month period.

In the first half of this year, 2,885 people moved from abroad to live in Taipei County, while 1,551 moved to Taoyuan County, and 1,090 moved to the central county of Taichung County, according to the statistics.

Over the past five years, Taipei County, Taoyuan County, Taichung City, Hsinchu County and Kinmen County have been the major districts in terms of migration, while Taipei City, Changhua County and Pingtung County have topped all districts in terms of net out-migration, the statistics showed.

More than 141,000 people have moved residence from other districts to the cities and counties in northern Taiwan over the past five years, indicating that the Taiwan population remains centered in the north, a Ministry of the Interior official said.

For the first time in the country's demographic history, the rate of inward migration in eastern Taiwan this year was higher than the out-migration figure, the official noted.

Taipei Mayor Hau Lung-bin attributed Taipei City's high rate of outward migration to factors that include the city's decreasing birth rate, high cost of living and steep real estate prices.

Thailand Locally made H1N1 vaccine almost ready

The Public Health Ministry plans to use the locally made vaccine against the A (H1N1) influenza next month.

Health deputy permanent secretary Siriwat Tiptaradol said on Sunday that the ministry had set up a committee to oversee the safety of the nasal-spray vaccine in accordance with the World Health Organisation's standard.

"The committee comprises three subcommittees responsible for conducting trials on humans, registering the vaccine and promoting its production," said Dr Siriwat.

Its members include experts from the WHO, the Government Pharmaceutical Organisation, the Department of Medical Sciences and faculties of pharmaceutical sciences of different universities, he said.

The first lot of vaccines should be out in the beginning of August, and they will be tested on animals first.

"If the vaccine is ineffective or unreliable, it will definitely not be used on humans," he said.

He said the government had agreed to spend 600 million baht to import two million doses of a preventative vaccine from Sanofi Paster in France, and they should arrive in Thailand in December.

How to Take Better Baby Photos

Carrie Sandoval has been photographing babies for six years, and she has attracted quite a following. It’s easy to see why: her photos are composed with an almost magical attention to organic form, light and simplicity.

Ms. Sandoval, who is based in San Diego, specializes in photographing newborns, although she shoots children of all ages. She got her start in 2002 with she bought a D.S.L.R. to capture her own children, then a 3-year-old and 10-month-old twins. Next she began snapping shots of other children at play groups, and soon parents began asking her to photograph their children.

I asked Ms. Sandoval for some of her tips on taking great photos of babies. Here’s what she had to say.
Q

What shooting mode — manual, aperture, auto — do you use for babies?
A

When I was learning, I would set the camera on aperture priority. I would pay attention to what my camera was choosing for the shutter speed during different lighting situations. Now, I manually set all of my settings by metering first. The exposure is so much more precise this way, especially when photographing a baby on a black (or dark) background.
SandovalCourtesy of Carrie Sandoval
Q

It looks like you prefer a very shallow depth of field? Why is that?
A

Shallow depth of field yields a soft and dreamy background, which, in my opinion, complements a newborn perfectly. It also keeps the focus directly on the baby. Another reason is because I use all natural light, and the wide aperture lets more light into the camera.
Q

What type of lens do you recommend?
A

I am a prime lens junkie. They are fast and sharp as a tack. My favorite is the Nikkor 50mm 1.4G. Newborns don’t move away from me, so I don’t need a zoom anyway.
Q

Any tips for point-and-shoot camera users?
A

Turn your flash off and place your baby near a big window. Choose a window that is bright but doesn’t have direct, harsh light pouring through. For example, a west-facing window during the morning.
Q

Why do you prefer natural light? Are babies sensitive to flash?
A

No, flashes do not harm babies. I prefer natural light because I am able to use those wide-open apertures. Natural light is always so soft and pretty to me. Plus, I like having the ability to be spontaneous around the house and not having to set up studio lights.
Q

You take a lot of black-and-white images. Do you recommend that for casual photographers?
SandovalCourtesy of Carrie Sandoval
A

I shoot in color and convert to black and white in Photoshop. I do love color, but newborn babies are oftentimes blotchy and red. This is less noticeable in black and white and easier to “fix.” I have been keeping color a lot more often lately, though. I prefer babies in soft, muted, natural (not overprocessed) colors.
Q

Any advice on taking photos outdoors?
A

I recommend simple, snug-fitting, solid-colored clothes that won’t distract from the baby itself. Bowls and baskets are the perfect outdoor props, both for newborns and older babies. Again, look for soft indirect light, under a tree or behind the shady side of a wall. If you can wait until late afternoon (about two hours before sundown), the sweet light is much more plentiful.
Q

How should you approach your baby? Should you always get on his or her level?
A

I prefer to stay low and close to my subjects (hence the 50mm lens). I will sit with a baby, talk to him or her, and sing songs before bringing the camera out. Six to eight months is a great age because they usually love any smiling face that comes their way, and they are sitting but not yet crawling away from the camera.
Q

How do you capture a baby’s attention?
A

I will play peekaboo from behind the camera, sing and shake rattles. Once a baby tires of that, I will put my “lens puppet” on. It’s basically a hair scrunchie that I sewed ears and a tail and glued wiggly eyes on. Some will laugh and smile at it, others want to grab it.
SandovalCourtesy of Carrie Sandoval
Q

What are some easy poses for babies, both alone and with siblings?
A

For newborns, cradled in a beanbag yields many poses, like curling them up while they are asleep, much like they were in the womb. If baby has an older sibling, I will lay the older child down in the beanbag first, then lay baby next to them and ask them to hug the baby. For older babies — again, I love sitters, not yet crawling — there are so many possibilities, like sitting (facing forward, sideways and backward while twisting back to see the camera), on their backs sucking their toes, on their bellies propped up on their elbows or hands. It’s easy to add a sibling to any of these poses. Just remember to keep them close by asking for hugs and kisses.
Q

Looks like you prefer your babies naked. Why is that?
A

Because that is the way they were born! Nobody looks as good naked as a baby does. Their skin is soft, pure and plump.
Q

When is the best time of day to photograph babies? Do they have a “happy time”?
SandovalCourtesy of Carrie Sandoval
A

I have found that babies of all ages are more content in the morning hours, preferably after a nap and a good feed. If you want sleepy, curled-up newborn shots, I recommend photographing them before they are 2 weeks old.
Q

What are the mistakes that people most commonly make when photographing babies?
A

I love using props (bowls, baskets, vintage prams, slings), but I keep them simple and secondary. Oftentimes, I see too many props or loud props that steal the thunder from the baby. This is totally a personal preference, but I say keep it clean and simple.

We expect Mumbai attackers to meet day of reckoning: Hillary

Noting that Pakistan houses a "syndicate of terrorism", US Secretary of State Hillary Clinton on Sunday said her country is watching the actions being taken by Islamabad against the scourge and expected that perpetrators of Mumbai attacks meet their "day of reckoning".

She emphasised that terrorism is a threat to all, including those who have given haven to such elements, and every country should stand up to defeat the menace.

"We are certainly watching and expecting that there will be justice and those who launched the horrific attacks in Mumbai will meet their day of reckoning," she said at an interaction with press here.

Clinton, who will meet Prime Minister Manmohan Singh and hold talks with External Affairs Minister S.M. Krishna on Monday, said she realises that the "syndicate" of terrorism in Pakistan is "troubling" India, besides the US.

Pakistan must dismantle terror infrastructure, she stressed. "It must not let its territory be used for terror and must act against it,'' she said.

"I have also sent messages very directly to the Pakistani people that this (fight against terrorism) is in the interest of Pakistan, the future stability and security of Pakistan," said the Secretary of State, who is on a five-day visit to India.

She said the US had "seen an evolving commitment, not only by Pakistani government but also Pakistani people and a recognition that terrorism within a country is a threat to that country".

In the last six months, "we believe there is a commitment to fight terrorism that permeates the entire government (of Pakistan). That is what our expectation is as well," Clinton said.

She said the US is talking to Pakistan at all levels -- government, military, civilian and intelligence-- on the issue of fight against terror.

"We are watching it and we hope they will make progress against what is a syndicate of terrorism -- Al-Qaida, Taliban and many other terror organistions are connected in a way that is deeply troubling to us, and I know to India. But it is also now troubling Pakistan," she said.

Emphasising that nobody is safe anywhere from terrorism, she said every country has a responsibility to "stand up against the scourge. This is not limited to any one country."

She said, "It is an expectation that we have from every nation because we think networking of terrorists across the globe, as we saw in Jakarta, is a threat to all people, particularly in democracies such as the US, India, Indonesia who are targeted by terrorists for very fact that we are living free and independent lives in sovereign, stable nations."

Clinton said the US is "working to make sure every country sees terrorism as we do because we happen to believe that terrorism is a threat to all, everywhere and there is nowhere to get safe havens for terrorists without putting ourselves at risk".

Crisis-hit firms have received ¥3.83 trillion

The government spent about ¥3.83 trillion in the seven months through June giving emergency loans to and buying commercial paper from private businesses hit by the global financial crisis, according to data made available Saturday.

The government effectively declared in its monthly economic report for June that the economy has bottomed out of the recession, but analysts say businesses are still largely dependent on public funds and assistance.

The data, including information from the Finance Ministry, show the money was spent in a total of 12,800 cases of emergency loans and CP purchases implemented by three government-backed lenders — Development Bank of Japan, Shoko Chukin Bank and Japan Bank for International Cooperation — as well as by private lenders.

The DBJ extended emergency loans totaling ¥1.83 trillion to large and midsize companies and bought ¥350 billion worth of CP, or short-term debt issued by companies to facilitate operations, between December and June.

The bank's emergency loans swelled to ¥390 billion in June alone, following ¥230 billion in May and ¥140 billion in April, due partly to a large loan extended to Japan Airlines.

Shoko Chukin Bank, which mainly supports small and medium-size companies, offered a total of ¥840 billion in loans.

JBIC, which helps finance Japanese businesses' overseas projects, extended ¥810 billion in loans.

Private-sector lenders have provided credit guarantees for a total of 596,465 loans worth ¥11.87 trillion taken by small and midsize companies by the end of June, up ¥2.68 billion from the end of March.

Drivers and Legislators Dismiss Cellphone Risks

OKLAHOMA CITY — On his 15th birthday, Christopher Hill got his first cellphone. For his 16th, he was given a used red Ford Ranger pickup, a source of pride he washed every week.

Mr. Hill, a diligent student with a reputation for helping neighbors, also took pride in his clean driving record. “Not a speeding ticket, not a fender bender, nothing,” he said.

Until last Sept. 3. Mr. Hill, then 20, left the parking lot of a Goodwill store where he had spotted a dresser he thought might interest a neighbor. He dialed her to pass along news of the find.

Mr. Hill was so engrossed in the call that he ran a red light and didn’t notice Linda Doyle’s small sport utility vehicle until the last second. He hit her going 45 miles per hour. She was pronounced dead shortly after.

Later, a policeman asked Mr. Hill what color the light had been. “I never saw it,” he answered.

Extensive research shows the dangers of distracted driving. Studies say that drivers using phones are four times as likely to cause a crash as other drivers, and the likelihood that they will crash is equal to that of someone with a .08 percent blood alcohol level, the point at which drivers are generally considered intoxicated. Research also shows that hands-free devices do not eliminate the risks, and may worsen them by suggesting that the behavior is safe.

A 2003 Harvard study estimated that cellphone distractions caused 2,600 traffic deaths every year, and 330,000 accidents that result in moderate or severe injuries.

Yet Americans have largely ignored that research. Instead, they increasingly use phones, navigation devices and even laptops to turn their cars into mobile offices, chat rooms and entertainment centers, making roads more dangerous.

A disconnect between perception and reality worsens the problem. New studies show that drivers overestimate their own ability to safely multitask, even as they worry about the dangers of others doing it.

Device makers and auto companies acknowledge the risks of multitasking behind the wheel, but they aggressively develop and market gadgets that cause distractions.

Police in almost half of all states make no attempt to gather data on the problem. They are not required to ask drivers who cause accidents whether they were distracted by a phone or other device. Even when officers do ask, some drivers are not forthcoming.

The federal government warns against talking on a cellphone while driving, but no state legislature has banned it. This year, state legislators introduced about 170 bills to address distracted driving, but passed fewer than 10.

Five states and the District of Columbia require drivers who talk on cellphones to use hands-free devices, but research shows that using headsets can be as dangerous as holding a phone because the conversation distracts drivers from focusing on the road.

Fourteen states have passed measures to ban texting while driving, and the New York State Assembly sent such a bill to the governor on Friday.

The states that rejected any efforts to limit distracted driving this year include Oklahoma.

“I’m on the phone from when I leave the Capitol to when I get home, and that’s a two-hour drive,” said Tad Jones, the majority floor leader in the Oklahoma House, who helped block the legislation. “A lot of people who travel are used to using the phone.”

Scientists who study distracted driving say they understand the frustrations of colleagues who publicized the dangers of tobacco. Like cigarettes, they say, gadgets are considered cool but can be deadly. And the big device companies even offer warnings that remind them of labels on cigarette packs.

Verizon Wireless, for instance, posts instructions on its Web sites not to talk while driving — with or without a headset. But neither Verizon nor any other cellphone company supports legislation that bans drivers from talking on the phone. And the wireless industry does not conduct research on the dangers, saying that is not its responsibility.

Some researchers say that sufficient evidence exists to justify laws outlawing cellphone use for drivers — and they suggest using technology to enforce them by disabling a driver’s phone. “Just outlawing the behavior cannot possibly go very far toward getting people not to do it,” said Robert D. Foss, senior research scientist at the Highway Safety Research Center at the University of North Carolina. “The behavior is too ingrained and compelling.”

For his part, Mr. Hill rarely talks when he drives now. His mother gave him a hands-free headset two months after the accident. She thought it would create less distraction. He tried it once, and found his mind wandering into his phone call so much that “I nearly missed a light,” he said.

Japan, U.S. set regular talks on deterrence

Japan and the United States agreed Saturday to set up an official framework to engage in periodic talks on the so-called nuclear umbrella and other deterrence measures, a senior official said.

The move reflects the U.S. intention to ease Japan's growing security concerns in the wake of North Korea's nuclear test in May by deepening discussions on the effectiveness and reliability of the nuclear umbrella, under which Japan is afforded protection.

The United States may also be hoping to defuse arguments among some Japanese lawmakers that the country should arm itself with nuclear weapons.

The agreement was reached at a Security Subcommittee Meeting attended by senior working-level officials from the Foreign and Defense ministries and their U.S. counterparts, including Kurt Campbell, assistant secretary of state for East Asia and Pacific affairs.

"We are going to start some briefings soon, very soon, (in the) next several weeks. But we will continue that in a more formal way later, subsequently," Campbell, who is visiting Japan for the first time since assuming his post in June, told reporters after the meeting.

Meanwhile, on the possibility of holding the six-party talks without North Korea to break the impasse in negotiations on denuclearizing the North, Campbell said the prospects are "not clear."

"The United States has said that we like to see at some point five-party talks in the appropriate circumstances, the appropriate preparation. We are not sure when or if those will occur," he said.

The six-party talks have been stalled since December.

Michael Jackson murder charges expected within days

MICHAEL Jackson's death will be treated as a murder investigation, a British newspaper has reported.

Citing close Jackson family friend and music producer, Terry Harvey, News of the World has reported that murder charges will be made within days.

Mr Harvey revealed to News of the World that an autospy on the King of Pop showed he had died from an injected overdose of the painkiller Diprivan and changes will be made against one or more people.

"The autopsy shows that Michael died of a drug overdose with Diprivan and a range of pills in his stomach. He had needle marks on his neck and all over his body,'' Mr Harvey said.


"The authorities have told the family the Drug Enforcement Administration are pushing for a criminal charge.


"It is likely to be second-degree murder, due to the actions which led to his death. They have been assured that someone, or maybe more than one person, will be brought to trial.''

Last week Jackson's sister La Toya Jackson told the same newspaper she thought her brother had been murdered.