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Just over two weeks ago, the yearlong battle over the health care bill came to an end with the Houses passage of the over 2000 page bill. To describe the process and what might be next, let me review the highlights from these battles.

Never was there any more than a vote or two of bipartisanship during the entire process;

Never was there common ground in the details of the bill by both parties;

Never did we see widespread public support;

Never did Americans express consistent confidence in Congress doing the right thing;

Never have we seen this degree of partisanship in Washington;

Never have we had such a large piece of legislation pass with such a degree of partisanship;

Never did the Democratic Party seem in sync except at the very end;

Never have we seen the large number (16 at last count) of states positioning a lawsuit against the bill

So, we are left to digest this piece of legislation over the next several months, leading up to the November mid-term elections. Most folks I speak with, agree with me that some aspects of our health care system are in need of fixing. However, what is most disturbing to these folks and me is that we had to have such a huge overall of basically most aspects of health care and quite frankly, people are very afraid to see the final cost, which everyone feels will be much, much more than is projected. For example, in the 1960s when Medicare was passed, the projected annual cost after 30 years or so was about $9 billion dollars. That estimate was just slightly off as we now spend about 10 times that amount. In addition, lost in all the health care debate fog, was the fact that when Medicare was enacted into law, the House had over 300 votes in favor; a much more palatable process.

What will the rest of 2010 bring and how much of an immediate effect will the passage of this bill have on our economy and markets? Well, weve seen a very nice recovery in almost all markets since the March 2009 lows. After a pause at the end of 2009, markets resumed their upward movement into the first quarter which was surprisingly strong. As the Dow approaches 11,000 for the first time in 18 months, all eyes are on several risks to this nice market run.

I see a few threats to this upward move by the markets. They are as follows:

The housing market seems to have stabilized in some areas of the US and world, but, foreclosures are still rising and short sales dominate many markets. Until we see not only stabilization, but consistent price increases covering many regions of the US, we cannot have a housing recovery. Buyers, there are still many opportunities awaiting.

Unemployment, although brightened a bit by last weeks job gains, has a long way to go. Basically, we need at least 250,000 jobs created each month for the next three years to significantly drop the unemployment rate. There is no evidence that this will occur or is there any evidence that the current Congress or Administration has anything imminent to help stimulate jobs growth. Certainly the Census is helping, but by July, look for those jobs to rejoin the other lost ones. Yes, we had a jobs bill squeezed in amongst the health care debate, but as I write this, there is no serious effort to reward small business for hiring/retaining workers. Again, until we see meaningful drops in the unemployment rate, everything else hangs in the balance. We have seen increases in spending and consumer confidence. I dont think that is a long term trend. Much of the spending dropped so dramatically, that any stoppage in decline or slight increase will look good in the short term.

Interest rates have not moved very much and the Federal Reserve has indicated and reiterated that with no evidence of a sustainable recovery, they will continue to keep rates low for the foreseeable future. This is both good and bad news for investors. The good news is that with interest rates low, borrowing costs are low and corporations looking to expand (yes, they are currently few and far between) can reasonable expect low rates. Also, homebuyers, who will need to borrow for their purchase can count on lower monthly expenses, at least in the short term. I say this because, in spite of warnings from me and others, some folks will still be tempted with adjustable rate loans due to the low starting costs and in an increasing interest rate environment, this spells more disaster.

We have seen some signs of rising rates when the 10 year Treasury issues yield just rose about 4% for the first time since 2008. Although not monetarily significant, this is a harbinger of things to come. And finally, lost in all the headwinds is perhaps the return of one of the biggest and quite possible the trigger mechanism for our large recession and that is oil prices. After beginning the year around $60/barrel, the prices have reached around $85/barrel. If this continues, we will have another headwind to worry about.

In spite of all these headwinds, I am actually positive on the overall global economy and yes ours as well. However, for investors, the easy part is over. Successful navigating of the waters which lie ahead will bring success to those with patience.