Dear Friends and Family,

Welcome back to school and to the changing of the seasons! Fall is in the air, and the leaves are changing colors.

The credit crisis continues to worry Wall Street and investors, along with mortgage and housing woes. President Bush signed a massive housing bill intended to provide mortgage relief for over 400,000 struggling homeowners and stabilize financial markets. The Federal Housing Administration was to begin right away to implement new policies intended to keep more American families in their homes. This legislation lets homeowners who cannot afford their payments refinance into more affordable government-backed loans rather than losing their homes. It also offers a temporary financial lifeline to troubled mortgage companies Fannie Mae and Freddie Mac and tightens controls over the two government-sponsored businesses. The legislation overhauls the Depression-era FHA. It requires lenders to show how high a borrower’s payment could get under the terms of his mortgage. The Treasury Department gains unlimited power, until the end of 2009, to lend money to Fannie Mae and Freddie Mac or buy their stock should they need it. The Federal Reserve takes on a new consultative role overseeing the companies. As always, if you have questions regarding your personal debt or mortgage situation, we are here to help.

Will the upcoming elections affect the stock market? Stocks have, in fact, risen in previous election years. The stock market has closed higher in 75% of all election years, going all the way back to 1888. The results are even better over a shorter period; over the last 50 years, only two election years were “down” years in stocks (versus 10 “up” years). We will have more on this topic in the next cover letter; for now, here are some fun facts about the first US President who was:

• Born a US citizen: Martin Van Buren
• Born west of the Mississippi: Herbert Hoover (Iowa)
• Born in a hospital: Jimmy Carter
• Impeached: Andrew Johnson
• A Boomer: Bill Clinton

We have some good news: many of you have signed up for electronic delivery of your Fidelity monthly statements, and now we can offer electronic delivery of our Katz Family Financial cover letters and monthly portfolios as well. Please email vicki@katzfamilyfinancial.com for the request form.

Sincerely,

Katz Family Financial