Saturday, December 22, 2007

This is just the beginning folks.

Fun times ahead

When I checked the mortgage crisis over the last few months I assumed that the beginning was in August. It normally takes a minimum of 6 months to do a forclosure. I know because there have been a few in my neighborhood in the last few years. So, when I saw this article I was surprised at the timing. I've also noticed that people from Ca. are moving here to the Northwest. I hate to tell them this, but our economy isn't any better. They may be lucky and find a niche position for technical jobs, but to find a transitional job until they get the job there after, well those type of jobs dried up in just the last two months. Our housing market is following California with the price of homes falling and rents climbing. The other problem with this is that there are still limited funds for financing and you can expect to be put under a microscope to get those loans. Don't expect to pick up a forclosure either as the speculators swoop down and snap them up like vultures.
The sad fact is that this is only the beginning. Let's see where we are in March or April when the next round of rate adjustments comes due. This is bringing back bad memories of the early 80's. Here's a brief accounting of what happened back then for those of you who were lucky enough not to have lived through it. We had massive inflation. Interest rates were around 18% or better then. Employers started cutting back jobs. People looking for work found nothing, not even the 'Mcjobs' in fast food and convience stores. With no work spending slowed and in turn employers cut back even more and the cycle continued. I don't remember what ended that recession only to say it took a very long time. It was not a fun time then but as they say "history repeats itself".
One last note to consider. All of the safety nets that had been in place in the 80's are now gone, wiped out by Reagoon and the Shrub in Chief. Might want to consider that used tent trailer and some other camping gear. It could come in handy soon.

Update: Here's an article that pretty much sums up what I said above. I'd like to add a side note to this. If the Feds lower interest rates, foreign investors who haven't already moved their money out of this country are sure to do so when rates drop making our problems worse.

Mortgage crisis

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