April 04, 2007

Morning Reading

A few interesting items this morning...

Add it all up: Continued signs of a slowing but still growing economy; new bullishness from one of Wall Street's smartest (and temperamentally least bullish) strategists; welcome, if temporary, relief in the Middle East; and the continuing redefinition of retirement in the U.S.

Apr 4, 2007 7:32:49 AM | Economics, Markets

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The High (and Hidden) Costs of Many 401(k) Plans Back on March 14th, the WSJ published an important piece (subscription required) by Eleanor Laise on the high costs of retirement plans in general and 401(k) plans in particular. Here are a couple key passages: 401(k) plans aren't required to make clear how much participants are being charged in fees. And there can be a lot of them, including charges to cover independent audits; tracking and maintaining accounts; advisory services; as well as help lines, and of course the basic expense of managing funds in a plan. In fact, investing in a fund through a 401(k) often can be more...
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Housing Derivatives Jonathan Keehner of Reuters has an interesting (and cleverly titled) item on the rise of housing-related derivatives. Here's the premise: While investors in nearly all other major asset classes enjoy the utility of a derivatives market, often to hedge their risk, those in fragmented and opaque U.S. real estate markets largely have not. But access to real estate indexes is adding U.S. commercial and residential property ownership to the list of items, from companies' debtworthiness to the weather, that investors can speculate on through listed and over-the-counter markets. Given the incredibly rapid expansion of derivatives markets over the last several...