With Halloween fast approaching, the absolute primebuying season is at our doorstep - the Holiday market, from Halloween through the first few weeks of the New Year.Throw into that mix a drop in rates, choices not seen for buyers in years and a ton of pressure on pricing. The end result is it’s a good time to be a buyer.It looks as if the economic indicators are pointing towards another rate cut at the end of this month when Bernanke, the Federal Reserve chairman, and the rest of the Federal Reserve meet again.The remaining fixes needed to stabilize the financial market are extremely slow to evolve.Congress and the United States Treasury are providing more debate than actual firm solutions.So, it looks as if the credit crunch will take the better part of the rest of this year to right itself.In the meantime, at the prompting of the Treasury, Citigroup, Bank of America and JPMorgan Chase and Co. are working together to develop a $100 billion fund to buy up bad debt and restore confidence in the credit market so that investors will enter the game once again.Investors have been on the sidelines since August waiting to be sure that when they reenter the commercial paper market their investments will be safe and sound with almost guaranteed short term profits.They have long memories and it was just in August that everybody realized that commercial paper was laced with bad subprime debt.With strict qualifications now in place and virtually no subprime loans to speak of, the commercial paper market will slowly become more enticing.As the government continues to debate the merits of increasing the conventional loan limit (where rates are cheaper and are backed by government formed agencies) beyond its current $417,000 limit, it appears that by the time they react, the market will have righted itself.Bernanke warned everybody to act now and not wait until March of 2008.It appears as if nobody was listening.Stay tuned!!
Garry Loss
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