The formation and execution of economic policy this week entered a new level of chaos, complete with good news, bad news, and silly news.
The best news: two different Federal-deficit study groups came up with the same basic solutions: cap spending and revenue at a sensible level of GDP, broaden the tax base by cutting special exceptions, and cut tax rates. Spending: in Alan Simpson’s line, “Harpoon every whale in the ocean.” The people are way ahead of political leadership, the average American eager to implement any deal like these two. Continue reading Lou Barnes Column for November 19–QE2, Robo-foreclosures and thou!
I like to quote Lou Barnes on the radio show. He’s been commenting on the financial markets for some time and is a featued columnist at Inman.com Here he makes a strong arguement against further credit tightening noting this is NOT the time to bear down on the housing sector as this sector usually leads us OUT of a recession:
“The most troublesome report was consumer credit: May outstandings dumped $9.1 billion, and the $1 billion gain initially reported for March-April was revised to a $14.9 contraction. A debate of sorts continues: bankers and you-deserve-it analysts insist that credit is shrinking because few will apply, and those who do are poor credits.” Continue reading Lou Barnes on Credit Tightening, Fannie Mae, Homeownership
By Louis S. Barnes June 4, 2010
HomeBuyers and Sellers here in Sonoma,California need to follow Lou Barnes column. “Today’s payroll flop — only 20,000 real jobs created in May — will take some time to settle all the way in. Immediately: 10-year T-notes are 3.22% (from 3.36% yesterday and 3.99% six weeks ago), and mortgages below 5.00%. ” (To follow Lou Barnes go to: firstname.lastname@example.org you can also go to www.inman.com and read his weekly column. )
“The payroll report has confirmation: new unemployment has held high for five months; May retail sales look soggy (“same-store” data); auto sales flubbed in May; and housing shows every sign of a serious fade, post-tax credit. Purchase applications have hit a 13-year low; the unemployed do not apply, nor do the underwater, and the few, the brave who think they are qualified often find themselves in the “rejected” pile.
In days ahead, the entire recovery camp from government to stock-pushers has more than explaining to do. It must change its mind.
All in one furball: How can mortgage rates be so low, and home prices so low, affordability the best ever measured, yet housing defies recovery? One unifying answer: credit. Not enough, and wildly too tight. Continue reading Why is the real estate market defying recovery? “Credit.Not Enough,and wildly too tight” so says Lou Barnes-read on!