fed bailout programs: "Would you like a side of hyper-inflation with your job loss and reduced-fat retirement?" - 02/24/09 01:59 AM
That is the question our government would be asking you if they were your waiter.  While I was doing this morning's mortgage market update, that thought came to mind as a great way to sarcastically explain the government's actions thus far.
With job losses mounting, the government claims they need to force through another stimulus package which creates more jobs, government jobs that is.  And they did exactly that, well not exactly as the amount of jobs they actually will create versus what they claim will not equal each other, and it will be inversely proportional to how much the cost … (6 comments)

fed bailout programs: Inflation: Hidden Giant Waiting to Drive Mortgage Rates Higher? - 02/21/09 11:13 AM
On Friday, we saw the release of the CPI (Consumer Price Index) and it showed inflation to be tame overall, actually falling into Bernanke's concerns, deflation.  Even when you look at the Core CPI, removing volatile food and energy from the equation, you still only see a small inflationary rate over the last year, just 1.7%.  But is the inflation rate really that low, or is it that the CPI is not showing reality, at least not yet?
First off, CPI can be manipulated somewhat, so let's just look at what we buy in the supermarkets everyday.  Everywhere you look, if … (13 comments)

fed bailout programs: When Lethargic Rabbits Start Running - 01/06/09 01:40 PM
Lately, my posts have become more about the warnings of government actions and their longer term effects on mortgage rates.  Ultimately, I have been talking about increased inflation, the mortgage rate bubble, and mortgage rates breaking into double digits, all of which could very well happen in the not-so-distant future as a result of Paulson and Bernanke's actions, along with continued "economic stimulus" packages.
Many have questioned why I am talking about rampant inflation when the chief concern right now is deflation?  I have eluded to the answers in my posts, however I have not been able to come up with … (3 comments)

fed bailout programs: Florida Mortgage Rates Hit 4.5% - 12/05/08 01:07 AM
Florida Mortgage Rates have reached the lowest they have ever been on a 30-year fixed rate mortgage, as mortgage rates have dipped to just 4.5%, falling below even the lowest rates seen in 2003. Now, more than ever, homeowners should be rushing to refinance or purchase homes as these rates may never be seen again.
OK, hopefully you have already realized that the above paragraph isn’t true, at least not yet. However, the lunacy of our Treasury Secretary (Henry Paulson) and Federal Reserve chief (Ben Bernanke) may yet make that paragraph a reality. Treasury Secretary Paulson openly admitted he wants mortgage … (10 comments)

fed bailout programs: Does Fannie Mae and Freddie Mac's Insolvency Spell Financial Doomsday? - 07/14/08 03:29 AM
I was reading an interesting article from Agora Financial which is spelled out in their "Rude Awakening".  One part caught my eye as they discussed what is currently taking place in the dual FM liquidity crisis, as presented by Dan Denning, editor of the Australian Daily Reckoning.
Dan talks about Ben Bernanke's comments to Congress that both Fannie Mae and Freddie Mac are well capitalized and how those were the statements by Bear Stearns just before their collapse.  Citigroup was the saying the same thing just before asking for more money.  Dan hits the nail on the head with these remarks...
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fed bailout programs: Should the Government Clean Up the Mortgage Mess? - 05/05/08 03:44 PM
Any time the government gets involved in a bipartisan intervention, you should be scared.  Their track record of successfully implement something both parties agree to is dismal, at best.  And right now, both parties are working to have the government intervene to clean up the mortgage mess.
Let's expand a bit and not limit the discussion to just the mortgage mess, for the whole mortgage and real estate fiasco has drawn down the economy.  Now the government is trying to figure out what is the best "stimulus" to get the economy back on track.
Well, if you look at history, the best stimulus … (12 comments)

fed bailout programs: House Panel Ok's Similar Bill Passed by Senate: Government Bailout Program Ok' ed (at Taxpayer Expense) - 04/23/08 02:42 PM
Democrats (go figure) pushed a $15B bailout plan through today. The program will provide money to cities and counties in the form of grants and loans (suspect mostly grants).  The intent is so the local governments hit hardest by the housing crisis can become the new "flipping houses" investor, maybe even become landlords.
Democrats argue that the bill is needed, along with other bills they want to pass, in order to prevent blight in distressed neighborhoods.  Have they been to South Florida lately?  Who is this really helping?
The bill's sponsor, Rep. Maxine Waters (D-California), says there is a pressing need for economic … (3 comments)