1.) Quantitative easing scares me to death. The Fed is playing with fire and hoping to not get burned. Whether you agree with the Feds recent decision making or not, you better hope it works. QE2 is in the works and its window of success is small, to much and watch out for inflation. But what happens with inflation, the Fed is forced to raise rates and you can pretty much expect the economy to completely shut down. The Fed has lowered rates to so close to zero that it is having to be creative to continue any kind of monetary easing. Ill be honest, the economy is no where close to full recovery. By the way, for those not familiar with quantitative easing, it is when the Fed creates money out of nowhere to buy financial assets. Much like printing money but instead they just key in few numbers to computerized accounts. I wish I could do that.
2.) Foreclosure Moratorium. This would only postpone the pain of foreclosure to the economy. Foreclosure is a tough situation and the only possible winner is the end buyer who may get a good deal on a piece of property. Trust me, everyone else loses big in foreclosure. From the banks to the home owners. Its best for everyone to stay in their homes, but when the bills aren't being paid, banks cannot simply keep the loans on their books out of charity. Foreclosures have done a lot to depress the housing market but the process has to play out. A moratorium will only delay the inevitable and create a back log of foreclosures that will pile up during a moratorium and then all will hit the market at the same time when a moratorium is lifted, causing a shock to the market that would devastate an already depressed market. Worst case scenario, if a moratorium was instated with political motivations and a short term fix caused long term problems just for a temporary political jump.
3.)Cant remember my third one, it was a good one though.
1 comment:
Just remembered my third thought. Obama sound bites lately. Ole Barak has been on the campaign trail lately and thus has spent some time in front of a microphone. The guy can speak and get a crowd fired up, I'll give him that, but some of what he says sounds good, but doesn't really make sense. It sounds good to say something like, "when I took office, the economy was losing 80000 jobs a month, now, under my leadership we are only losing a few thousand every month" (not a direct quote). That's like a gambling addict saying I used to lose 5k at the casino every month, now I'm only losing 500. The gambler has simply run out of money. If he had 5k, I bet he would find a way to lose it. Just so, the economy is running out of jobs to lose. If the unemployment were a 100%, I'm sure the president would be quick to say that under his current leadership nobody else will lose their job! And without a doubt, a crowd somewhere would cheer.
Post a Comment