Sadly, the headline news of last week was Hurricane Katrina and her devastating path of destruction in the South. While the overall magnitude of this natural disaster has yet to be fully comprehended and assessed, the immediate economic impact to the country will be felt in the way of higher energy costs. Approximately 25% of America’s oil and gas is distributed from New Orleans, and the entire city has essentially been destroyed. Further, it could take months to fully restore oil and gas production in the Gulf of Mexico, as Katrina put a stop to 92% of the Gulf region's regular crude oil output.

A mixed Jobs Report hit the wires on Friday morning, showing the lowest unemployment rates in over four years, but brought little market reaction. Bonds continued to react to the economic implications of Hurricane Katrina by moving higher during the week, causing home loan rates to improve by about .125% across the board.

The victims of Hurricane Katrina are in our thoughts and prayers. If you would like to help, please click on the following link to donate to the American Red Cross Disaster Relief Fund: http://www.redcross.org

"Many times a day I realize how much my own life is built upon the labors of my fellowmen, and how earnestly I must exert myself in order to give in return as much as I have received" - Albert Einstein

Ask anyone the significance of Labor Day and most will say it officially marks the end of summer. But did you know that the observance of “Labor Day” dates back to 1882 and has been recognized as a National Holiday for over 100 years? The holiday started as a local celebration and parade to honor of the working class by the Knights of Labor, an American labor organization in New York City. Over time, the date evolved into an annual national tribute, honoring the contributions to our country made by workers across the US.

The Knights of Labor held the first Labor Day celebration on Tuesday, September 5, 1882. By 1884, a resolution was passed to make this an annual event in New York City. The Central Labor Union urged similar labor organizations to follow the trend set by New York City and the lobbying paid off. On February 21, 1887, Oregon became the first state to declare it a legal state holiday. Within four months, Colorado, Massachusetts, New Jersey, and New York followed suit and also declared it a state holiday. In 1894, Congress passed a law recognizing Labor Day as an official national holiday.

Labor Day is celebrated around the world, however the US and Canada are the only countries that always observe the holiday on the first Monday in September. In Europe, Labor Day is celebrated on May 1 and is known as May Day.

And don’t forget…as you are enjoying the celebration of Labor Day, don't forget to pack away your white shoes – they can come out again on Memorial Day!

Remember, as a general rule, weaker than expected economic data is good for rates, while positive data causes rates to rise.

For the week of September 5 – September 9