The Arizona Sentinel

April 23, 2009

The Results of 100 years of Government Meddling

Filed under: My Posts — thearizonasentinel @ 4:49 pm
The Arizona Sentinel
 
Well, new numbers are out on unemployment and housing.
First time claims were up last week by 27,000 raising the monthly average to 640 thousand unemployment claims. Raising the total 12month numbers to well over 6 million-first time filers. Add to that the 9 million that have either out lived their unemployment eligibility or just gave up.  We can readily see the improvement from Government meddling in the economy,market,and business growth.
Numbers for Real Estate are as reported this morning from the National Association of Realtors.  Existing home sales fell in March by 3% in March and the Feb numbers were up by 4.9% overall they  fell by 7.1% from a year ago in 2008.
Prices fell year over year 12% to an average of $175,000.00 prices fell in the West 11% in the North East down 18%.  That is year over year, Inventories now at record levels of 3.4 million units. Realtors across the country are reporting that half of all home sales are distressed properties, either foreclosed or short sales and repossessions. That number is up 45% year over year. Fifty-one percent of all sales are first time home buyers, Obviously smartly taking advantage of the price adjustment and lower interest rates. And the tax credit that the Obama administration has added to the tax code. Which you must remember is a taxpayer subsidy of first time home buyers, Someone has to pay for that credit.  There has been a reported price increase in home prices, WHY?  That is simple, the lower the interest rate the higher the cost of the home. Added to that the tax credit will artificially establish a pricing.  DUH.  Bottom line lower interest rates, reduces the mortgage tax deduction at the end of the year. And raises his base line cost of the home.  This policy benefits the Government not the buyer.  Wake up Americans do the math. Let me make one other point here. Lets say that you could get a mortgage at a ZERO percent mortgage rate. What effect would that have on the base line cost of the home. Obviously it would go up dramatically. Your monthly payment would be relatively the same as if you paid a 5-6% interest rate but bought the home at a substantially reduced rate or to put it another way, you would pay what the home was actually worth, not some over inflated number that a realtor or appraiser threw at you . And to the governments benifit, you will be paying a 21-28 percent rate of taxes on money that you would normally be deducting,… DUH!
 
Bottom line, your year end tax liability would go up because you have lost your mortgage interest deduction.  Its Elementary Watson.
 
Now lets look at the auto sector, General Motors announced yesterday that they would be closing most of their plants for the summer. ((( Pay attention to this one folks, My view is that this is a nice way of saying that we are going to be filing for bankruptcy June the first, and its not likely that these U.S. Plants will reopen anytime soon probably never.””)))  The tell tail will be if they close the GMC plants in Canada, if they do, I believe that that will tell the market that GM will move entirely to Mexico and China, resume manufacturing at some level, releaving the Corporation of UAW legacy costs going forward. That would be what I would do If I were Mr. Henderson.
The problem for American taxpayers is that the federal governments meddling in business, will have failed once again, and the billions of dollars given to GM over the past 12 months, will have simply gone up in smoke or into Union Pockets,.  Politicians sticking their nose where they have no experience(Obama,Bush,Paulson,Bernanke,Geitner,Frank,Dodd,Pelosi,Reid), you get the idea, is a terrible idea.
 
Yesterday the CFO of Freddie Mac , hung himself in his basement. At first glance, that would seem sad, But Im thinking that this fella Kellerman, took Senator Grassleys advice, Recognized the trouble he was in, recognized that he woulda ,shoulda, coulda, and made the decision to bail out. This may seem cold hearted but here is how I come down on this.  Had he stayed around and faced the music, he would have cost the taxpayers millions of dollars in lawyer fees, Second what ever worth he had developed for his wife and daughter would have been wiped out, by defense lawyer costs, Once the wife and daughter get over the grief of losing a father and a husband, reality will set in.  Mr. Kellerman, you ultimately did the right thing for the country, and your family.
But heres the question. What did David Kellerman know, that we now may never know.  Because Obama, Geitner,Bernanke will move the troops in and seal the truth about Freddie Mac, . Freddie Mac and Fannie mae hold 56% percent of all U.S. Mortgage Paper, And there is little doubt that the majority of that paper is sub prime, simply put, They aint worth the paper their printed on.
We will never know the facts or the true status of Freddie Mac.
Until some whistle blower comes forward and spills the beans. We will be waiting!!!!
Lou Dobbs and a few others are saying that there will be no Depression. Well, I hope they are right, however, I disagree and here is why. Unemployment that is the true number is going to reach 18-21 percent. The Dow will see , 3000-3500 in the next 6-18 months.  Crude oil will drop to 30-35 dollars per barrel. And Real estate prices will continue to decline.  Unless, Government reverses its course.
First, The administration should shut up. And stop the anti American retoric. In fact stop all attempts at policy , domestic and foreign. Every cabinet member should go on a 12 month vacation. Obama should stick to playing with his puppy. As long as they show up on the boob tube, confidence, frustration, mistrust,anger,in fact hatred “you should read some of the emails I get”.
In fact the only way I see this country turning around is if the states, sever their relationship with the District of Columbia.  They must step up and take charge. And stop looking to the District of Columbia for salvation.  There is a reason the District of Columbia in not a State.  Government is sucking the life blood out of America. 
 
The Third Party Revolution is on the March
Long live the Constitution

FEDUPREPVET, Turned Independent

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