Which is your favorite paranoid fantasy?

[tw]

Originally Posted by footfootfoot

I'm a fiscal retard, can you give me the Cliff's notes interpretation of the implications of that fact?

Has good news in this economy been based in productive activities? Well, incomes have been dropping for the past five years. So why the strong housing market? Was that housing market due to productive and necessary products - or just wild speculation?

With ridiculously low interest rates, then people were either buying houses they needed, or speculating. Unfortunately, this - the major driving force in the American economy - is traceable to Americans who could not otherwise buy homes, Americans who have combined low interest rates with dangerous balloon and variable rate mortgages, and the rich buying vacation homes. IOW the economic boom will not result in increased wealth four and more years later.

Well maybe homes would be a good investment. But housing prices are now starting to do what was long predicted. People will do anything to not let their house price fall - even delay a sale. But eventually the dam will break. And so this 2% drop is feared to be a dam breaking.

Those who otherwise could not afford the home and those who were only buying on speculation will suffer. Big part of the American economy that has been its 'engine' may collapse. That is the economic fear to a flurry of bankruptcies, a collapse of industries that kept the American economy looking good, and maybe a major recession.

Is your house assessment performed annually? Of course not. An assessment increases 50% because prices have inflated into a bubble. Housing prices have become that much excessive - and people just kept buying. Even worse are the many who took out equity loans on their house. A housing bubble that economic analysts fear because economics tends to take back easy money - vindictively.

Any one of three things may happen. Housing prices drop leaving massive debts for homeowners - maybe a house worth less than its mortgage. Rents skyrocket. Third is inflation resulting in much higher interest rates. We already see inflation jolting upward AND massive American dollars overseas waiting for what?

This economy has not been about America producing things. America's manufacturing economy is about 15% below what it once was - proportionally. Americans are becoming less technically able as indicated by college degrees (and skyrocketing numbers of student no longer finishing college), exportable products, and the number of immigrants who are now required for the more productive jobs. All this time, those problems are vague and looming because problems do not yet appear on spread sheets.

One need only look at how Home Depot and Lowes are changing their business models to appreciate what is expected. This 2% downturn is expected to increase in next 5+ years. People with houses worth less than they paid for or less than its mortgage.

Economic diseases are cured by recessions. Are you financially secure to weather a recession, loss of housing values, or massive rent increases? This is the question that a 2% drop in housing prices asks of you. After all, what other industry is ready to employ Americans when the housing industry drops by 50%. Toll Brothers has already seen a 50% drop in sales – therefore even resulting in a drop in house prices. What's in your wallet - or savings account? Were you foolish enough to take out a balloon mortgage or interest variable rate? Are your credit cards at $0 balance? That 2% drop in housing prices may be your last few warnings. Speculation and easy money is over. Satan demands his due.

That 2% drop in housing prices is considered a leading indicator of economics taking revenge on easy money. A problem only made worse by an $800billion trade deficient and a $100billion war that is being lost. Of massive dollars sitting overseas and not yet appearing on spread sheets either as the selling of America, devaluation of the dollar, or inflation. The American economy was so stable and reponsible in the 1990s. Major problems are looming. Maybe this time, we will not make mistakes - and instead increase interests significantly before damage occurs; avoid the 'guns and butter' mistakes by Nixon in late 1960s. We have major outstanding debts and we have an economy that looked good only as long as housing prices kept increasing.

[slang]

Originally Posted by tw

Any one of three things may happen. Housing prices drop leaving massive debts for homeowners - maybe a house worth less than its mortgage.

The loss of good "auto-jobs" in the last few years in the Detroit area has a high number of people upside down on their homes.

Overall I see this as amusing but only because most of these people believed that they were smarter than God by buying more house than they could afford. Why put money down on a house? Mortgage it to the max. It'll only increase in value, right?

Now, someone with a relatively small chunk of CASH could roll into those areas and own what was recently a very nice home.

Oh yeah...all of this bad news is Bush's fault. We all know that.

[tw]

Originally Posted by slang

Oh yeah...all of this bad news is Bush's fault. We all know that.

George Jr's part in all this is massive spending because "Reagan proved that deficiets don't matter". That massive lump of American dollars overseas, a military now short of resources, a universally low American approval rating, quagmires in two wars that we cannot win, and the massive debt those wars are creating ... all are directly traceable to a president who then so fears Americans as to wiretap them - without judicial review.

We have yet to see how much George Jr will cost us. $100 million given away to build a hybrid. When that GM product did not appear 10 years later - GM still does not have a hybrid - then what does George Jr do? Nothing. Eventually more Detroit jobs lost as partioitic Americans buy the best - principles of a free market economy. The bastard even gave the airlines $8billion with no strings attached. Massive tariffs to protect an anti-American steel manufacturers industry.

Do you think corporate welfare is free? Do you really think economic forces do not come back four and ten years later to take revenge? That is the legacy of a president when god (rather than reality) talks to him. George Jr has successfully engineered an economy that is now growing less than the inflation rate. It is no accident that American wages have dropped during George Jr's tenure. Fiscal responsibility? He was a drunk and drug addict. He is an MBA. Where does that say anything about responsibility? Has he really changed - or just imposed his bad habits on us? We know he is a liar - no way around that reality.

Originally Posted by tw

George Jr's part in all this is massive spending because "Reagan proved that deficiets don't matter"...

That's right... because eventually a Democrat will get voted in and fix it for them. Until the next one comes along.