Dr. Housing Bubble 07/24/08

[Crewleader]

California Solution for Budget Crisis: Minimum Wage and Laying off People.
But Who Will Buy the $500,000 Foreclosures?

You really have to tip your hat to our politicians. The House approved the biggest bailout in the history of this country although they are trying to highlight the Congressional Budget Office report that the total price tag will cost approximately $25 billion. Yeah right. Yet what seems to be more astonishing is the vast majority of Americans seem oblivious to the entire bill. It looks like it will have Senate approval and will be signed into law by the President soon. Only a few of those in Washington sounded any sort of alarm regarding this. The greatest financial robbery in American history and few seemed to pay any attention.

Today is the first time in a week that people are coming back into reality. Sales of existing homes declined to a 10-year low and Ford posted their largest quarterly loss ever. Ford is now being forced to double their hybrid production and move away from their reliance on trucks like the F-150. So much for a second half recovery. Washington Mutual isn’t getting the benefit of the doubt like so many other companies that were getting a free pass these last few days. They are now quickly heading back to a 52 week low on their stock price. As people dig into the legislation it is apparent only a handful of institutions stand to benefit.

I’m not sure if any of you listen to the KNX Business hour here in Southern California but for the last few days, they’ve had a couple of bank Presidents, some who are on infamous lists, stating that all is okay and they are well capitalized. One of the representatives was saying, “we did not do subprime loans so we are okay.” Yet they fail to mention their extensive portfolio of Pay Option ARM loans and Alt-A products that will prove to be just as destructive.

http://www.doctorhousingbubble.com/california-solution-for-budget-crisis-minimum-wage-and-laying-off-people-but-who-will-buy-the-500000-foreclosures/