- The biggest news this week that affects our pocketbook is the Bank of Canada’s decision to keep interest rates steady. The prime rate, on which interest charged by the banks for loans and variable mortgages is based, stays at 6.25%.
- The Bank of Canada notes in its interest rate decision that the credit crisis will directly affect our finances by way of higher interest on loans and mortgages. Also, the Financial Post reported that the bank repeated the warning in its monetary policy report that borrowing costs have increased by about 0.20% to 0.35%.
- BusinessWeek is taking a retrospective look at the equity market crash of 1987 when the Dow plunged a 22.6% on Black Monday and features excerpts from a report speculating on what systemic failures might cause the next crash.
- Warren Buffett was in Toronto recently and The Star reported that the Oracle of Omaha thinks that our dollar will be higher over the next five years.
- Ellen Roseman reviews a book that I am currently reading: Your Money & Your Brain.
- Rob Carrick takes a look at distressed preferreds.
- Jon Chevreau wrote a column and blog post on new “global dividend” funds and tries to figure out the math on these products: yield (3.6%) minus MER (2.4%) leaving 1.2% in the investors pocket. Vanguard Europe Pacific ETF (VEA) will probably sport a yield of approximately 2%. Deducting the MER of 0.15% will still leave investors with more dividends in their pocket.
Blog Roundup
- Melanie McLister explains why clients like dealing with a mortgage broker.
- Frugal Trader asks if you have a money-lending rule.
- Mike continues his big, fat series on RESPs with a post on government grants.
- Sticker shock! Canadian Financial Stuff wrote about the steep costs of a university education.
Have a nice weekend!
