The Economy Continues to Slide – Homesales Continue to Slow

Well, President Bush has done it again!

Abou three months ago he proclaimed that the economy wasn’t in recession but WAS in a “slowdown”. Three cheers for the Yale education you’ve got Mr. President!!! You’ve talked the economy into a real mess…..not to mention the war in Iraq and the lies you and your administration told to get us to to believe that Iraq was somehow related to 9/11. Seems like everyone has forgotten about all of that. Well, so much for my political ramblings……

We’re here to talk about real estate and the state of the market. To say the least things aren’t looking good at all. Congress needs for the July 4 parade without passing legislation to help homeowners and solve the foreclosure crisis.  What the hell are they thinking?  This is truly the time to hold Congressman accountable for their lack of action.  The economy is a meltdown and what do they do?  They help bail out big banks like Bear Stearns and at Lehman Brothers, before they help out regular everyday homeowners.  Meanwhile gas prices are about four dollars a gallon and olio is ready to hit $150 a barrel!  That’s right $150 a barrel!  The economy is really in a down slide and what do the legislators do?  They go home, eat hot dogs and hamburgers, and continue to do nothing.

Who will help the American taxpayer?

It’s hard to remember a time in the last 20 or 30 years that parallels the economic times that were currently having.  The only time thing that comes to mind is Jimmy Carter’s presidency and how he failed so miserably regarding the gas crisis.  Interest rates were high gas prices were rising but I don’t remember home prices deteriorating like we’re seeing now.  Make no mistake the foreclosure crisis is probably the single biggest event in our lifetimes that will have a profound impact on how the future.  Just how long will it take us to get out of this housing crisis?  What new laws and legislation will be put in place to assure that big banks and mortgage companies don’t continue to peddle fraudulent loan products to consumers? Perhaps fraudulent is too strong a word for some of you.  However, in my opinion, the mortgage companies and big banks knew, or should have known, that these mortgage products would blow up in the face of most ordinary consumers who were faced with an inordinately high interest rates on mortgages after the interest rate adjustments started.  Our homeowners at fault?  Sure, homeowners probably have some fault given the fact that almost no one reads the fine print on the mortgage when you’re in the lore is office and ready to sign on the bottom line to get the keys to your new home.  When the lawyer handed you your paperwork while in his office and ask you to sign right here, did you ask him what you were signing?  Do you yourself read every word on the printed pages that you were signing to be assured that you weren’t giving the state custody of your children by signing the paperwork?  I don’t know one person other than the mortgage broker who reads mortgage paperwork before signing.  Hopefully that will change.  

What can be done realistically right now to stop the foreclosure crisis?  Well the government could come in and pass legislation to literally rewrite the loan terms of every mortgage that is currently in foreclosure.  Though that wouldn’t help everyone and probably shouldn’t help everyone since there are many investors that have mortgages and those investors don’t have the same interest in a property that they homeowner who actually lives in it has. The homeowner simply wants to build a home for their family the investor wants to make money.  The investor is supposed to be of a higher knowledge and skill.  So if she doesn’t read or mortgage and gets bitten by higher adjustable rates, I’m not sure we should help her.  But if a regular homeowner gets bitten by the same higher adjustable rates, we definitely should do something to come to his rescue, especially when it becomes a nationwide problem as it is right now.

Hopefully Congress will see fit to actually pass legislation that helps homeowners.  You don’t see Congress putting together a grand scheme of lies, bringing Colin Powell on the stage with elaborate slide shows and graphs indicating the depth of the mortgage problem.  There is no media campaign to rally public sentiment against the big banks who, in many cases have fraudulently stolen the homes of tens of thousands of families.  It’s funny how we can put together a major media campaign to link Iraq and Saddam Hussein to the 911 attack, but we can’t launch a major media campaign to bring the same $300 billion to assist American homeowners.

For a moment while writing this I almost forgot that I was living in the United States.  What a country.