Most folks are concerned about the passage of the health care package. In fact, it does not matter whether you agree or disagree with the plan, most are concerned. Will I be able to get more coverage, better care and reduced costs. That seems to be the question at hand for everyone involved and those of us who will be impacted by it.
However, the law of unintended consequences is always at play when politicians get involved with things. We are already starting to see some of the impact, albeit mild, from the plan passing. Over the first few days of this week we are seeing the stock market, which rallied all of last week mildly pull back. This is due to the fact that we now have the government committing to get involved in about 18% of the economy. Until more is known stocks may have a hard time rallying.
Additionally, the bond market has had the wind taken out of it’s sails. This is leading to higher mortgage rates already. This particular impact is being caused by the fact that the potential for higher government deficits relative to the current ones are now in play. If the government is going to borrow more money to pay for healthcare, it will have to pay higher rates to do so.
So who knows what the big picture holds. Certainly not us here at Pacor Mortgage. However, we know for sure that the uncertainty related to this new program is spooking the stock and bond markets, for now. Hopefully the new healthcare law will be worth it.
