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Editor's Choice for the Week of March 1, 2010: Market Moving News for This Week--A Sale by AIG, Beige Book, and Financial Services Reform

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Last week we learned that in February, the Dow Jones industrials rose 2.6% to close out the month at 10,325.26–the best return for blue chips since November 2009′s 6.5% gain–while the Commerce Department announced that GDP rose at a revised annual rate of 5.9% (from the original 5.7% estimate) in Q4 of 2009. While AIG reported a fourth quarter loss of $8.9 billion; there are reports that Prudential plc of the U.K. has agreed to buy the troubled insurer’s Asian life insurance business, AIA, in a deal worth $35.5 billion; the deal could hasten the payback by AIG of TARP funds.

Also this week, the Federal Reserve will issue its beige book of economic conditions on Wednesday, March 3, while the Labor Dept. releases the February jobs report on March 5.

The lobbying is heavy in and around the Senate Banking Committee, where chairman Chris Dodd is expected to finally roll out a financial services reform bill which may or may not include a new consumer protection agency and a fiduciary responsibility for brokers–the most recent intel suggests the bill will call for an SEC study of the issue.

The Banking Committee itself is scheduled to hold a hearing on small-business borrowing and lending on March 2.

Meanwhile in budget-hell California, Calpers is looking at reducing its 7.75% expected rate of return on its portfolio. According to Reuters, a spokesman for the pension fund wrote that “given the market conditions over the last year we feel it’s prudent to review our assumptions.”

And in the euro zone, there are reports from Reuters that Germany, the Netherlands, and France will buy Greek bonds to help ease that nation’s debt crisis; Greek Prime Minister Papandreou is slated to meet German Chancellor Angela Merkel on March 5; the European Central Bank meets on Thursday, March 4.