what has me.... is getting rates in the 10 year and the 30 year down.
Maybe it's what santelli is saying about "Pushing the market"
.... There are no buyers for homes, None... all the liars won't buy, and won't qualify. The home builders are still building some homes. You just can't make a loan cheaper to find a buyer. With the ARM's at 3% everybody who could afford at that rate purchased.
so to get the fixed to 4%...(which is horse crap, you will find more refi's than new Mortgages at that rate)
We need to motivate jobs, employment, the economy.
I'm just stumped.....
Tuesday, December 16, 2008
head scratching
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I'm not sure how they plan to do it, but the goal is to get some money lent out to spur jobs.
The problem is that the jobs will pay salaries in devalued dollars. The dollar tanked today, so the real return on stock was mitigated. Why did the dollar tank? Hmmm.
Bernanke has emptied his quiver, now it's up to Congress to dump more dollars into the economy with a huge fiscal package... and it will be huge.
Which asset class will survive this conflagration of printed money?
that is what is killing me, they think the solution is to be able to get people to finance homes at 4%.
there are 4X too many construction companies. 2x too many homebuilders. and more homes than anyone can afford. Moreover, not enough liquidity to finance them.
there are just too many homes and not enough buyers.
Even if you help all the outstanding homes be financed at 4%, by those with stable jobs.
The 73-75 cycle, was coming to terms with inflation.... We aren't even there yet. If we hit inflation there is a huge new instability the market will have to deal with...
So to answer you question, the only thing to own are commodities.
they need to focus on corporate rates...
Maybe you haven't realized or maybe I haven't but the thing that made me bullish is dollar strength. Even if there is some back and fill, the instability in that rate.. Just that one thing is enough to make me bearish... Just the volatility, shows instability. 20% currency swings are not healthy for anyone.
this is again one of those times where I want nothing to do with any of it.
I'm just banging the old type writer here till I have some invest-able thesis
I'm stumped
I agree that the investing environment is a puzzle... even the trading environment is becoming impossible to figure. I have gold and gold miners and silver, but I'm not sure if I should sell on the news now. I'm thinking that we will all be amazed at the size of the stimulus pkge that Obama signs in Feb.
The govt-- the fed and Congress-- are bound and determined to devalue the dollar by any and all means possible. The last thing we need is more houses being built, but houses we will get. A better program would be to re-build levees and highways and light rail... we'll see if that gets traction.
A Republican friend tried to defend Bush's economic program last September by remarking that the dollar was strong because when push comes to shove the US dollar is still the world's safe haven when fear grips the market.
Ha!
It's the stability that is killing me. Markets can't normalize without stability. I picked up gold yesterday, and will be dumping it tomorrow, mostly because I don't have the slightest idea what is going on....
I picked it up based on a weakening index and a fear trade.
It sort of leads me all to.. the old macke theme WTF do you want to play.
and the mess that this move made of my charts...
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