Mar. 27, 2007 - The Perfect Storm
Wall Street is rattled and the pundits are saying that it's the soft housing market that is causing it. New home sales are down and builders inventories are up. Charlie Gibson is doing a series on The Home Wreckers. I heard him blame the mortgage industry for all the foreclosures that are taking place. Home prices in most areas of the country are feeling the downward pressure of an over saturated market. I believe I saw Chicken Little running down Main Street today screaming that the sky is falling. The local hobo was wearing a sandwich board that indicated that the end is near. Doom and gloom are the buzz words of the day. The perfect storm is brewing. What are we to do?
Perhaps we would feel better if we sang. Come on everybody sing along with me now: "What goes up, must come down. Spinning wheels got to go 'round." Sir Issac Newton figured the what goes up must come down part out along time ago and not much has changed. I realize that the basic premise of it is about gravity, but think about it, it works on just about everything. It's the yin and the yang. It jives with that for each and every action there is an equal, but opposite reaction thing. Have you ever heard that ditty that goes something like "Those that the gods would make crazy, they first raise up"? That's all this is my friends.
When they talk about consumer confidence being at an all time low, who are they talking about? Has anyone asked you about how confident you feel as a consumer lately? It is my belief that the spinning wheels of the media sets the tone for consumer confidence. One thing I know for sure is that you can take statistics and make them say pretty much whatever you want them to based on what you leave in and what you leave out. How are things at your house? Is your mortgage being paid? Is there food on the table? Even though Wall Street is rattled by the soft housing market do you still have a couple of bucks left in your IRA?
If you are faced with, or actually in foreclosure then I guess you didn't listen to your REALTOR® when they told you that interest only loans would come back to haunt you. You must have been daydreaming when they said that the A in ARM stood for adjustable and that rates would most likely be adjusting upward.
On the other hand, if all is well with you and you have a few extra bucks, perhaps you should give me call. Now would be a great time to invest in some rental property. All of those people in foreclosure are soon going to need some place to live.
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