Government Morons Mess Up the Foreclosure Bailout

Mid-Day Market News & Commentary by Chris McLaughlin, November 11, 2008
http://www.shortsalesriches.com/welcome.html

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Now I’m madder than I’ve ever been at bureaucrats. You owe it
to yourself to read this, and then forward it on.  Because the
word needs to get out about these clowns.

Did you see the latest joke from the government
about the so-called foreclosure bailouts?  Yeah, clients
have to be 90 days behind on their payments, and Fannie
and Freddie may push their mortgage out from 30 years to
40 years! 

Does our taxpayer money pay for such stupidity? They just
extended the foreclosure mess by another 2 years
with such an absurd proposal.

Think about it.  You’ve got a buddy who’s underwater on his
house but can probably afford to carry the mortgage.  Now he
hears all about the government bailout, and he’s madder than
hell that some folks are gonna get a free ride.  So what does
he do?  He stops making his payments in order to qualify for
the 90 day behind rule. 

The government proposal actually will INCREASE, not DECREASE, loan defaults.  Do any of these people who make these rules have a clue how real estate works?   Do they know how mad people are about bailing out Wall Street and leaving Main Street hanging?

I bet the executive from AIG doesn’t have to wait 90 days to
get help, huh?  He’s got $150 billion reasons to thank Uncle Sam,
meanwhile Realtors are struggling and the bureaucrats don’t
understand basic economics about supply and demand. 

So what was a huge problem…with 4 million people behind on
their payments…is now a catastrophic problem.  All due to
outright government stupidity.

In the worst economy since the Great Depression, this is what
the government offers us?  Pushing loans from 30 to 40 years,
adjusting interest rates?  Please…

Hasn’t anyone ever told these morons that the only way to solve
this crisis is to stimulate DEMAND for homes.  By focusing
on supply, all they are doing is creating more problems and
giving more false hope to millions of homeowners.

How about a $7,500 tax credit that doesn’t need to get paid
back?

Ok, enough of my rant. It is time to take action, and that’s
just what I’m doing.  I’m going to explain, in detail, just
how you can forget about the government’s stupidity, and make
serious cash in this market.  Frankly what would have been over
in 2 years just got pushed out to at least 4 years.

But I’m limiting this webinar to just 30 people.  That’s it. 
The personal attention will let people ask questions about the
bailout, how they can do even more short sales, and how they can
make serious cash in the worst economy since the Great Depression.

The title of the webinar:

“Government Morons Just Made the Foreclosure Crisis Worse. 
How You Can Profit From Their Stupidity.”

So go now to register for the webinar that’s held on Thursday night at 9 PM EST, 6 PM PST, while there’s still room:

http://www.thursdaynightwebinar.com

Now, on to our real estate investing education section…

Asset Classes that Outperform Inflation

Now that Senator Obama has become President Elect Obama, short sale investors would do well to take note of the risk of increased inflationary pressures; after all, the funds to finance broad economic stimulus packages and other spending programs must come from somewhere. With the federal government already running record-breaking shortfalls, the risk of inflation continues to be a major source of concern.

In a search for asset classes that outperform inflation, the average investors doesn’t have unlimited resources like those of Buffet to purchase underperforming (but highly volatile) corporate stocks or bonds. Likewise, gold, silver and other assets are known to be equally volatile in the short term. Thanks in large part to favorable tax treatment and the use of leverage afforded by mortgage loans, real estate remains one of the most accessible asset classes historically known to outperform inflation over the long term.

With media pundits calling for deflation followed by inflationary – or even hyper-inflationary pressures that result in the eventual index of the dollar – every short sale investor should take note of the long viability of investing in real estate. Not only does real estate provide an inflationary hedge but if the dollar is eventually indexed, hard assets are one of the few ways to retain purchasing power.

When speaking of inflationary pressures it is a good idea to keep a few basics in mind including:

1.     CPI – Consumer Price Index is the notorious “basket of goods” used to determine the official rate of inflation for the nation at large.

2.     Personal Rate of Inflation. Many “real” people have a different personal rate of inflation due to individual or family situations such as health and medical expenditures, sending a child to college or other life events.

3.     Investment Time Horizon. The level of inflationary risk you are able to tolerate largely depends upon your retirement time line and long term anticipated spending needs. For example, assume you plan to retire at age 60. According to government statistics, you can expect to live another 25 years…without a paycheck.

The historical average rate of inflation is typically 3.5 percent with the current government rate approaching 6 percent. Clearly, inflation remains a major concern when it comes to retirement planning. Now consider the advantages to short sales:

1.     Instant Equity

2.     Favorable Tax Treatment

3.     Inflationary Hedge

4.     Ability to earn long term income and appreciation

 

More tomorrow…

See you at the top!

 

Chris McLaughlin, J.D., M.B.A.
web: http://www.shortsalesriches.com/welcome.html

 

P.S.: You are going to be on our next Webinar tonight aren’t you?  As Jim Rohn said: “If someone is going down the wrong road, he doesn’t need motivation to speed him up.  He needs education to turn him around.”  Get that education now:
http://www.thursdaynightwebinar.com