Labor Day - a day to relax and savor the end of summer and the last long weekend of sunshine and fun, right? This may be how most Americans see Labor Day today, but it is far from its true meaning which dates back to the height of the industrial revolution.

Labor Day was originally established as a day to honor those who toiled twelve hours a day, seven days a week to keep American running in the late 1800’s. Recognizing the history of Labor Day may enhance the holiday’s meaning for you and your family. Here are a few facts you may not have known about this day that is dedicated to America’s workers:

There are two versions of who created Labor Day:

• Peter J. McGuire, secretary of the Brotherhood of Carpenters and Joiners and co-founder of the American Federation of Labor, suggested the day be put aside to honor those “who from rude nature have delved and carved all grandeur we behold.”

• The second Labor Day creation version involves Matthew Maguire, secretary of the Local 344 of the International Association of Machinists in Paterson, NJ, who proposed the holiday while acting as secretary of the Central Labor Union in 1882. Maguire planned to have a picnic and demonstration in honor of American laborers.

Tuesday, September 5th, 1882 marked the first Labor Day celebration in New York City when 10,000 workers took an unpaid holiday and marched in Union Square marking the first Labor Day parade. These participants vocalized grievances with employers as well as celebrated the American workers’ accomplishments. The next year a similar demonstration was held on the same day. Oregon, Colorado, New York, Massachusetts and New Jersey were the first states to declare Labor Day a state holiday. On June 28th, 1894 the first Monday in September was declared Labor Day by President Grover Cleveland.

Labor Day celebrations have shifted from parades and demonstrations to speeches and picnics. Although Labor Day traditions have evolved, the American labor force still deserves celebration.

The American Labor force today is a far cry for where it began in the 1800s. Although an eight hour work day and a minimum wage may seem standard today, this was not so when Labor was first celebrated:

What became known as “Haymarket Square’ occurred on May 4th, 1886 when police broke up a riot in which seven policemen and four people were killed along with 100 wounded. The attention gathered from this gave steam to the labor reform movement, causing the work day to change from twelve to eight hours.

In 1938, Congress passed the Fair Labor Standards Act making the minimum wage $0.25 an hour and a maximum of 44 hours in a work week. The Act has been revised multiple times, eventually raising the minimum wage and cutting down work weeks.  In 1962, the Work Hours Act provided time and a half pay for days worked over eight hours or weeks worked over 40 hours.

The changes made due to Labor Day and the American labor force in the 1880s proves there is much to be appreciated. Without this day and those who created it, eight hour work days and a minimum wage would not be possible. Weekends also came to be because of these fearless fighters, and most notably the last long weekend that rounds out the summer.

So turn on the sprinkler and sip some lemonade, but don’t forget to give a toast to those who made it possible.

Have a safe and happy holiday weekend from your friends at MCT.

INDUSTRY NEWS

MCT Group comments about Interest Rates: After the actions of the federal government during the last couple of weeks, it is expected that the FOMC will continue to reduce rates. There is especulation that there is a 75 % chances the rate cut will be 1/2 a point.

Ahora que se acabo el “boom” del Real Estate o Bienes Raices, muchos dueños de casa se encuentran en una posicion que no necesariamente los categoriza como “duenos de casa”.Durante el boom muchas instituciones financieras dieron no solo el 100 % sino hasta 125 % del valor de compra o avaluo (que en mi opinion magicamente igualaba el precio de compra).  Pero estas hipotecas se hicieron durante el tiempo en que los valores de las propiedades estaban “inflados” dando como resultado un financiamiento que basado en precios reales o precios actuales del mercado de hoy, resultan en hipotecas de 125 % hasta de 150/160 % del valor. Ahora estos homeowners se encuentran con hipotecas o deuda que sobrepasa el valor de sus casas ……..Fin de esta historia? Definitivamente no ……  muchas de estas hipotecas fueron basadas en lo que llamamos “Hipoteca con interes variable o ajustable” las cuales ya se estan caducando para esa revision de intereses. No olvidemos que esas hipotecas se dieron cuando los intereses estaban bajos …..  nos damos cuenta del problema? Ahora, para aquellos homeowners que si tenian patrimonio o equity en sus casas (patrimonio o equity se define como la diferencia del valor de la propiedad menos deudas de la proiedad), Uds que durante los años 98, 99 y 2000 ese equity estaba disponible por el 69.2 % de los homeowners, en el 2007 bajo al 50.4.  Esta accion de incrementar la deuda reduciendo el equity para propositos que no necesariamente eran para usar para la casa en si, esta efectando o poniendo en peligro el retiro de millones de personas …..

De acuerdo al anterior Chairman del Federal Reserve, el Señor Alan Greenspan y el Economista James Kennedy, durante 2004 los dueños de casas “sacaron” $468.7 MIL MILLONES de ese equity …….. pueden inmaginarse el impacto economico? Dependiendo de su edad y situacion economica, Ud deberia pensar detalladamente y con cuidado antes de drenar los fondos que tal vez seran su unica forma de poderse retirar comodamente.

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