August info

I find it strange that all of the sudden things don't look as good as the headlines made the economy seem to be for the last few weeks. Headlines like the FOMC sees a leveling out. That sounds good but even if we are leveling out, we're leveling out with unemployment around 10%+ nationally!! How long will we stay at that. Some states are as high as mid 20% for un and under employed.

The worst news and what seems to be buried when it comes out is that we're starting to see the mortgage mess hit A paper / prime borrowers. I read a scary stat that said that by the end of the year 50% of the homeowners, 50%!!!, will be upside down across the country.

The DOW might be up, but these are speculative indicators. It's up because people have thought or have been lead to believe things are getting better. For example; Cash for Clunkers. The program is already out of money and needed more. The government is basically giving down payments for new cars to be bought off of lots that the existing cars where just sitting.

This made auto sales look good. Cars are moving off lots and then the lots need to replenish their inventory. But will the auto makers hire back full timers or just seasonal part timers to pump out what they need to until the Cash for Clunkers run is over. There never seems to be a shortage of people when the government is handing out free money. What happens when that ends. Cars will sit again.

Jobs and Losses

I've come to believe that the reports of job losses and unemployment really mean nothing these days. A week like we've had would point to a turning economy but from the average man / woman, times suck. I don't know people that are doing better or their job prospects are turning around.

This article is interesting to read and gives a little bit better explanation of what these numbers actually mean.

Krugman

By the end I think he sums it up well (and I'll paraphrase), the crap storm might be slowing down but we're still standing and sinking in crap.

The truth is coming out

Almost all the news today has been bad. Higher unemployment, lower sales and poor housing news. Basically all the stuff I've been talking about, the truth behind the headlines, is starting to poke it's head.

Next week will be an interesting one. The should be a few big sales of treasuries and depending on the demand we'll know where rates are going. I feel with this bad news out this week, people will buy up treasuries for safety which will bring the yields down and in turn hopefully the rates.

Again, I beg all of you to go to www.hvccpetition.com and sign this. What is going on with the appraisal process is going to kill this business and the value of your home.