Financial Regulatory Bill

What a week where things went down Monday through Thursday and then went up on Friday. The key driver for the week was the Financial Regulation Bill that passed early Friday morning. Things went down due to fear of what might be passed and then went up when it was realized that it was not as bad as people thought. I am looking forward to when Congress goes on recess for the rest of the year, all of this help is very painful to our accounts. With this issue behind us, I am anticipating a better week.

Vanguard Week In Review

The economy grew at a slower-than-expected pace in the first quarter. The housing market remained weak, and factory orders declined. Federal Reserve officials saw gradual improvements in the economy but didn't think it was strong enough to withstand a rise in interest rates. For the week ending June 25, the S&P 500 Index fell 3.6% to 1076.8 (for a year-to-date total return—including price change plus dividends of about -2.5%). The yield of the 10-year U.S. Treasury note declined 12 basis points to 3.12% for the week (for a year-to-date decrease of 73 basis points).

Financial Regulation Bill

What does this Financial Regulation Bill mean for us? Probably not a whole lot will be noticed except banks have to pass along the new taxes, aka cost increases, in this bill. So expect changes where higher fees will be rolled out in subtle ways. You should keep track of these costs and prepare to move to another bank if necessary.

30 Year Mortgage Rates

This week the 30 year mortgage rate reached level not seen for 40 years. ALLELUIA this is great news for 4 reasons:
1) It gets rates back to their normal historic level prior to the 1970's
2) It allows people to refinance and put more money in their pocket, a stimulus
3) It helps the housing industry as homes become more affordable
4) It helps all of us taxpayers since the 30 year treasury rate is also now lower this means that interest on the national debt is now lower helping with our budget deficit

Deficit Reduction Focus

This week politicians did something very difficult and did not extend unemployment benefits once again. While this is the right thing to do from a deficit reduction perspective it is tough on people who are looking for a job and uncharacteristic for a politician. This shows that the environment is changing and some tough choices are being made. I view this as a very positive and significant turning point for our politicians and our country.