http://docs.house.gov/rules/health/111_ahcaa.pdf

Then, I have a deal for you. Charles Schwab has announced that it is going to let clients trade a handful of exchange traded funds without paying any commission on the transactions.

Of course, there will be fees imbedded in the funds, as there always are.  But the fees, or what are called the annual "expense ratio," are low -- 0.08 percent on one that invests in large U.S. companies and 0.15 percent for an international fund.  You won't pay commissions when you buy or sell the funds

The company called this a "game-changer" for brokers and the fund industry when it was announced.  And I think it could be just that. 

Afterall, paying about $12.95 a trade can add up if you do it often. So being able to avoid commissions altogether is a great deal.  That's particularly attractive if you do a lot of trading, or if you want to dollar-cost-average into the funds.

The new funds introduced this week are the Schwab U.S. Broad Market ETF, the Schwab U.S. Large-Cap ETF, the Schwab U.S. Small-Cap ETF, and the Schwab International Equity ETF.  They track Dow Jones indices.  More Schwab ETFs are coming in December, and will allow investors to more finely tune portfolios with international small caps, an emerging market ETF and growth and value style large caps.

The comment might seem startling given his emphasis repeatedly on the need to pull back the nation's deficit once the economy is less "fragile" than it now is.  But as Geithner spoke with the Chicago Tribune's editorial board today, he said "I am deeply at peace with the necessity of what has been done" -- including the government's intervention in GM, investment banks, AIG and Fannie Mae and Freddie Mac.  He emphasized that the money is getting repaid.

By showing a willingness to devote "overwhelming force" he says the government was able to break the panic threatening the system in the aftermath of the Lehman Brothers collapse.

"I felt that after the TARP was passed we'd broken the back of the panic," he said.

Still, Geithner notes that while there are "encouraging" signs in recent economic statistics, "unemployment probably will rise further." Although some analysts worry that the nation could be going through a "jobless recovery," Geithner says the recovery so far seems to be following a typical path.

Yet, in answer to a question about rethinking tax policy, he said the economy remains too uncertain to "think about what shape restraint will take."  Likewise, while applauding improvements in credit availability and securitization through backing of mortgage-backed securities and small business loans, he acknowledged that without the government's hand the credit crunch would be worse than it is.  He says it's too early for the government to withdraw support.

"We are in a classic credit crunch," he said, and that, plus uncertainty about economic growth and proposed health care and energy legislation, have caused some reluctance for businesses to spend.

Although some market watchers believe that commodity prices have escalated too quickly and could provide inflationary pressure on the economy, Geithner said he sees those prices as "an encouraging sign."  He thinks prices have moved up as "the risk of acute deflation has been taken out of the system.  People are pricing in future growth."

"I look at saving as encouraging," he said before an audience of business leaders at the Economic Club of Chicago, as Ariel Capital Management founder John W. Rogers asked: "How will we get consumers to spend again?"

Instead of trying to prod consumers to go back to borrowing and buying, Geithner noted that increased saving will be part of the changed behavior in this country for years.  He said the financial crisis taught an entire generation about the risks of excessive borrowing, and he thinks Americans will consequently "look ahead and plan for an uncertain future."

Although more frugal behavior "will slow the recovery," he said more saving by Americans will allow the country to borrow less from foreign investors -- a long-term positive for the country.

Meanwhile, as Americans buy less, Geithner says the nation will need to depend more on exports to stimulate economic growth.  He sees the evolution starting and said, "I can say now with confidence that the financial system is stable; the economy is stabilized.  You can see the first signs of growth here and around the world."

Although some worry that the nation will face a new crisis as commercial real estate owners lose tenants in a slow economy and fail to pay banks back on loans, Geithner said "I don't think so," when asked if real estate would threaten the economy.

But he added that the country still must overcome a credit crunch and that there is a need for securitization to return so that adequate lending can provide growth.  Securitization used to make it possible to lend trillions of dollars in money because banks could make loans and sell them to Wall Street -- alleviating pressure on the banks to hold onto loans.  With that avenue of financing closed down, the credit crunch has continued.

Another long range need, according to Geithner, is to reduce the government's budget deficits.  They are too high and long-term are unsustainable," he said.  "We must bring those down."

The nation must "convince the world" that the country "will go back to living within our means," said Geithner.

It would be unwise to "raise taxes in the midst of this recession," he said, but noted that the government eventually "will have to make some tough decisions."  Among those decisions will be reforms of the Social Security system, he said and then added: "We are the United States of America; we can solve that."

Dear Gail,

I have a great business idea that has not been really tapped into that would be beneficial to buyers and sellers of real estate property for most families.  This would also make money for whoever wanted to take on the task of matching up real estate customers. 
 
I have been trying to sell my property in Bremen Township and had two to three people interested all of whom had property of their own to sell.   They, like myself, haven't been successful at it because of the need to unload their own real estate first.  Loans are harder to get now even though we have as a country bailed out banks with taxpayer money and now they are very hesitant to free up that money for real estate loans.  Kind of ironic.  Anyhow,  instead of focusing on actually selling properties why doesn't somebody come up with  a company that matches up potential buyers who could swap properties with or without a money difference in price and the company gets a contracted selling fee after the process concludes and the deal is completed.  This could be  a local idea say for a particular county or more vast, etc.   It could even become popular online!
 
Thanks would be interested to know what you think of my idea

Steve Kaster

The next time the Dow hits 10,000, let's have a party.

I remember the first time we were here.  It was March 29, 1999, and my friends at the Wall Street Journal put on freshly-made hats that said, "Dow 10,000."  In those days it looked as though there was no stopping the Dow.  We were on a technology-stock high.  Throughout Wall Street corks were popping. James Glassman had written, "Dow 36000" in all seriousness and people believed it.

By early 2000, we would learn that what goes up must come down, especially when stock prices are soaring without reason.  You will recall that when the Dow hit 10,000 in 1999 and continued upward, technology stocks were doubling in weeks -- even when companies had never shown a profit and never had a chance of doing so. People who knew nothing about stocks thought they were brilliant as they bought anything tech and made money. 

Some, who'd never met me, would call me at my newspaper office simply to giggle about their new-found wealth.  One elementary school teacher told me she never would have thought she'd need a tax shelter, but suddenly felt compelled to find one.

When the fantasy burst, a lot of average folks got hurt as 401(k)s turned into 201(k)s.  It started out slowly with the Dow losing 6.2 percent in 2000 as the pros kept up the mantra: "buy the dips” and newbie investors followed.  Then, the next year the market lost another 7.1 percent, and finally a painful 16.8 percent in 2002 as investors learned that Wall Street darlings like Enron were based on creative accounting and a lot of phony cheer-leading. 

As investors lost faith in the market they had loved, they assumed it would never recover and they sought safety in the housing market.  After all, a home was something you could touch; not another flimsy Wall Street fabrication.  Then the mania began. You couldn't avoid the house flipping shows on TV.  Eventually house flipping became as popular as tech stock speculation in 1999, and an illusion of prosperity took hold and the Dow soared once again. It closed at 14,164 on October 9, 2007.

Then came an astonishing discovery:  It's not just stocks that are the bad guys, but rather any investment that gets carried away in a mania, greed and fraud.  This time we discovered that Wall Street’s folly went far beyond touting tech stocks that were worthless.  This time they conjured up mortgage=securities of questionable value and infected the world with the toxic stuff.

Now, the market has climbed about 50 percent since the lowest point of investor disillusionment in March and the Dow has crossed the 10,000 mark once again.  But the average American isn’t buying it yet.  Brokers tell me clients send them on their way if they try to talk about stocks.  The money they have invested during the last couple of years has gone mostly into bonds.  They are home licking their wounds after losing about $12 trillion in net worth – both in housing and in the stock market.

 Now, hedge funds and large institutional investors are playing while ma and pa hunker down.  Americans are living the life that PIMCOs Bill Gross says is the “new normal” – a long period of frugality and employment worries that might provide 2 percent annual growth a year to the economy for much of the next decade.   People are trying to pay off debt before credit card companies make their life more miserable.  They are worrying about keeping their jobs, wondering if they can hold onto their homes, and questioning whether they will be able to retire or send the kids to college. 

There is no partying over Dow 10,000 this time.

College Credit

My column was a continuation of some fine reporting done by Jon Yates, another Chicago Tribune columnist.  He's been writing about people who innocently failed to tell insurance companies about long-gone symptoms like headaches, and as a result were denied thousands of dollars in coverage for medical emergencies.

In my column, I told the story of a woman who had back painand says she forgot about it when applying for health insurance.  A few months after buying insurance, she ended up having $40,000 in bills for emergency gall bladder surgery.  And she is still fighting two years later to get the emergency covered.  The insurance company claims she failed to report a pre-existing condition -- the backaches that went away after she took ibuprofen.

Yet, who among us has not had a back problem or a headache and forgotten about it?  I wrote my column to tell people how to protect themselves.

Since the column appeared, many people have written me with their own horror stories about insurance companies.  I wanted to share the following, because this one is especially shocking....

Dear Gail,

Here's a story you'll love.

I met a woman at a party, and she told me that I should write a story about insurance companies screwing over people.

Well, she told me her mom was killed in a car accident in England. Some guy hit her, killed her mom instantly. Her father ended up paralyzed and the rest of his life in a wheel chair. He lost his job, since he worked construction and could no longer do that.

The guy driving the other car was insane. He was off the charts insane. The woman telling me this (their daughter), said they lost their house, as the father couldn't make the payments. He couldn't work.

And in court, the insurance company was told they DID NOT have to pay, because....legally, insane people can't enter into a contract. Therefore, his insurance isn't valid.

Yet, the insurance company didn't know he was crazy. And, they didn't have a problem collecting his monthly payment for years. They just have a problem paying out. And the courts sided with him!!!

I would have to think, though...in the case you mentioned...the courts wouldn't consider having pain in your back, and taking aspirin provided by a nurse, wouldn't constitute a "pre existing condition." Otherwise, any one with a headache, tooth ache, stomach ache, etc...has lied on those forms!

So, it seems she can sue.

Anyway, thanks.

Josh

Perhaps that's because your emotions are driving your investing decisions.  You might think you are using logic, but behavioral finance experts say we tend to go with our emotions in predictable ways that are purely human. These experts -- who combine psychology and investing -- try to make investors aware of  the typical mistakes their emotions cause, so that people can rise above their weaknesses and make more money.

Try this investor psychology quiz designed by Kiplinger to learn more about this.  Perhaps recognizing your emotions will help you decide whether you should be adding to stocks, bonds or cash now.

We just closed out the third quarter, and the Standard & Poor's 500 gained 15 percent for the quarter and 38.84 percent for the last two quarters.  That was the best two-quarter performance since 1975, when the market was also recovering from a horrible bear market.  During the first half of 1975, the market gained 42 percent.

With the market's close today, S & P analyst Howard Silverblatt said we have completed the best seven months of consecutive gains since 54.94 percent in October 1938. 

From the lows in the market on March 9, the S & P 500 has produced a 56.25 % gain -- the best since increasing 56.81 percent in 1933.

And although September began with pundits warning that September is notoriously ugly for investors, those who fended off the doomsayers did just fine for the month.  The market gained 3.57 percent this September.

Now, for the sobering news:  Despite the tremendous rally, the S & P 500 remains down 32.46 percent from its 2007 high. And investors are clearly on edge.  The market fought off a sharp decline early today as the Chicago purchasing report signaled a weak economy.  I thought a comment made to Bloomberg by Wasatch fund manager Ralph Shiva summed up the nervousness in the market: "We are in the faith part of the economic cycle."