A mish-mash, a hodge-podge, a veritable potpourri

There are times in the course of human history that a ton of little bits of news come out, but none of them are really interesting enough to warrant a whole newsletter. This is one of those times.

Existing home sales rose by 7.2% nationwide last month, showing the greatest jump in the past two years. While this has many realtors dancing naked in the streets (and I’ve seen ‘em), I am a tad less apt to party like it’s 1999. Much of this phenomenon can be attributed to homebuyers trying to close before the rapidly approaching demise of the $8000 1st time homebuyer tax credit (only 101 shopping days left, kids). Also, home prices are still falling (significantly faster on the West Coast than here on the East Coast, thankfully).

I sincerely hope that last comment doesn’t make me the victim of a gang-related shooting. Just reporting the facts, homies. Fo’ shizzle.

Cash for Clunkers, the amazingly well-received government program aimed at supporting the auto industry and reducing car emissions, will end on Monday. There just ain’t any more money to throw at it. So, once that falls to the wayside, we will get a better glimpse as to just how healthy our auto sector (and hence the non-farming middle part of our country) really is. Maybe we’ll have to bring in the new death panels to decide their fate.

Tee hee. I love topical humor.

Everyone and their mother is trying to call when the national economy will bottom and begin the long trek back to the financial heights of yesteryear. Even our glass-is-half-empty Fed Chairman Ben Bernanke is coming out with more upbeat language about the possibility for economic stabilization. While I will be the 1st to admit that there are some reasons to be optimistic, the sentiment on Main Street is still poor. That, and the mass amount of liquidity provided to the markets is like methadone to a heroin addict. Good, but not a long-term solution. I want to see our economy stand up and admit “Hi, my name is America and I’m a debt addict.”

And, to close on a positive note, convicted multi-billion dollar scam artist Bernie Madoff allegedly had (drum-roll, please)… a mistress! Awesome! Hey, at least the guy is staying true to the scum-of-the-earth motif he started with. There’s something to be said for consistency.

That anvil overhead seems to be getting bigger

Another Fed meeting has come and passed and, as expected, dang near nothing happened. Benchmark rates are being held between 0 and .25% and no more money has been committed to buying long-term treasuries. Pretty quiet meeting.

Buuuuuuut, it’s the calm before the storm.

Let’s think about things. The Fed is holding mortgage rates down manually through these treasury purchases. That program will expire in October, meaning rates are inexorably headed higher at that time. The $8000.00 tax credit will expire at the end of November as well. Merry friggin’ Christmas.

That’s a double-smack to real estate. And, I may be alone on this one, but I’m pretty sure that shooting the knees out from the real estate market is...dumb. Really dumb. Like, heave us kicking and screaming back into recession, dumb. Stabbing a fork into an electrical socket while standing in a kiddie pool and juggling lit Molotov cocktails, dumb.

Okay, that last one was a tad extreme. But you get the message.

Stocks are doing super-dee-duper because companies are posting great numbers. But, the majority of that improvement is coming via the billions that us taxpayers spent to subsidize their problems. So, yes, it’s cool that the Armageddon-style, we’re all going to lose our jobs and have to resort to subsistence farming to feed our kids scenario has passed. But life is not peachy keen quite yet.

So, Swami-Greg has some predictions to make:

The heat on Obama to stop overspending will result in the expiration of the real estate friendly programs to stem the tide of governmental debt. The holiday season will hit and consumers wont spend nearly the money that Wall Street is hoping they will spend. Corporate numbers will start to falter.

And the mighty U. S. of A. will limp into 2010, the anointed recovery year, rather weak.

What happens then is up in the air. But one thing is for sure: I am quite glad I am not a politician. I have a hard enough time deciding between paper and plastic, much less guiding the country through a financial minefield.