The financial regulatory reforms signed into law by President Obama last week are intended to accomplish a number of things. But one potential effect that probably wasn’t designed into the legislation is a leveling-off of the economic rollercoaster ride the city’s economy has taken as the financial services sector’s fortunes have risen and fallen in recent years. Financial services in recent years has generated more payroll taxes in the city than any other in recent years, so it stands to reason that the sector accounted for more than two-thirds of the $2.9-billion decline in payroll taxes here in 2009. The newly enacted Dodd-Frank bill could lessen that volatility, which should rein in profits for Wall Street firms in the short term but should stabilize revenues in the long run.

Now that the legislation is signed, there is less uncertainty, which is good for the economy. Markets generally adjust well when they know exactly what they are dealing with. And a more stable environment fuels the confidence necessary for a solid real estate environment. It probably will ease the extremes on the very high end, although we should not forget that some great fortunes are made in any market conditions and there is always a shortage of the very best in Manhattan luxury real estate.