Consumer Advocate Spat
A coalition of organizations supporting Wall Street reforms says efforts by Senate Republicans to block any nominee for director of the new Consumer Financial Protection Bureau would maintain the status quo in the aftermath of the recent economic crisis. "Deceptive and abusive mortgage lending was a fundamental cause of the financial crisis," Americans for Financial Reform said in a statement. The group criticized a letter 44 senators sent to President Obama in early May threatening to withhold support for any nominee to lead the agency, which begins work July 21. The senators contend the agency's mandate will be too broad, and want a board of directors instead of just one person at the helm. They also are insisting that the agency be accountable to other financial regulators.
Housing Decline Extended
Home values in the United States will not hit bottom until 2012 at the earliest, according to Zillow, a Seattle-based housing market research firm. Zillow revised its original forecast from this year after it found home values fell faster in the first quarter of 2011 than they had during any quarter since 2008. The Zillow Home Value Index fell 3% from the fourth quarter of 2010 to the first quarter of this year. Negative equity for single-family homeowners reached a new high, 28.4%. Also, one out of every 1,000 homes went into foreclosure in March, statistically flat in a year-over-year comparison, according to a Zillow spokeswoman. Less than a handful of local markets escaped the declines, with 97% of the 132 markets Zillow covers posting dips.
Catching the Rebound
Target-date 2010 funds have recouped much of the losses suffered during the recent bear market. In fact, they have even squeezed out modest gains, Morningstar says in its Target-Date Series Research Paper: 2011 Industry Survey. From Oct. 9, 2007, through Feb. 17, 2011, target-date funds gained a cumulative 5%, on average. Of the 23 funds that existed through the entire period, 14 posted gains. The S&P 500 declined 7% during that time, and the MSCI EAFE Index lost 17%. The 2010 funds that performed best combined heavier equity weightings with bigger allocations to corporate bonds. Less successful funds focused on high-quality, benchmark-oriented fixed-income categories.