Two Guys Opinion

Switch from Gold Standard, how much Money is the Federal Reserve Government Printing, and what is it doing to the value of the dollar?

Over the last few months we have had massive amounts of money thrown into our faces by the government and the media. But do we really have any comprehension of the real world visual of how much money it really is? Let’s run a few facts across before we get to what a trillion dollars looks like.

We have two bail outs already, each were about $800 billion. That is about $1.6 trillion dollars.

Obama issued his budget that totals a whopping $3.6 trillion.

“$2 trillion was lost from 401(k)s and IRAs in the past year…as well as $2 trillion lost from pensions.” That is $4 trillion of people’s lives that have been completely washed down the drain. (View Source)

Our overall Federal Government Obligations for the United States is a staggering $65.6 trillion. Don’t be decieved by the Deficit Clock every one looks to. That is just a portion of our debt. Read here for more information.

Now that we have those figures in mind take a look at what a trillion dollars actually looks like in a physical representation. Follow this link to see for yourself.

If you are shocked, you SHOULD be. Were is this money coming from? It is either credit created from thin air or straight from the FED’s printing presses. And the kicker? EVERYONE WANTS MORE!!!

This is going to kill the US dollar. Everytime we lend money that isn’t really there we deflate the value while everything else inflates to adjust. If something isn’t done I have a bad feeling we are headed for a complete meltdown.

And thats the way I see it…

Stocks were up around 10% off a 12 year low!

This is good news for the bear market!  Once Stocks start going up, people want to jump in, and not miss this chance to buy at the bottom.  Lets hope this is the case, several reports are coming out this week, that could have a huge adverse affect on this rise in stocks.  While last weeks announcement that unemployment hit an all time high since 1967, I believe for first time people to apply, stocks went up on the retail sales report.  One thing to keep in mind, is several people are out spending that tax return.  I expected the retail sales to have increased with the Early filers of taxes.  If your needing to spend money, you file early. The USA has a yearly built in Stimulas package every year around this time with this tax return spending.  Look for Wal-Mart and other Chain stores to report a rise in Sales for this quarter.  (hint buy some short time stock)

Freddie Mac asks Treasury for $30.8 billion!

I would Love to run my company into the ground.  Hell, Way Below ground with crazy lavish spending!

Then, her comes the bailout!  We need to keep this company alive, they tell us.  Billions are pumped in, Government takes control.  But wait, they want more Money now???

Freddie Mac, the government-backed mortgage finance company, said Wednesday it has asked the government for $30.8 billion in additional funding to close a gaping hole on its books.

Gaping Holes????  Let me run this down!

Some people default on their house loans!
The Banks cry, say they are losing money, because they were greedy and gave under qualified people loans.
The USA Government steps in with a bail out package and gives them billions.
The Banks now have these debts paid for.
The Banks Still Own the House the took from you!
The Banks are going to re-sell that house, thus getting more money!
The Banks will still Sue you for the difference between the high inflated house price they sold the house to you at, and what they sell if for, thus More Money, that I thought was already covered by the bailout!
The Banks are asking for More MONEY!

I need to open a Bank or Lending company!

Continuing jobless claims spike to 5.3 million. Weekly jobless claims rise to 654,000!!

It was the highest level since record-keeping began in 1967. Continuing claims have set a new record for six out of the last seven weeks. The 4-week moving average was 5,139,750, an increase of 124,250.

If you have bills, Pay them off!  I am sorry to sound so negative, but I believe it is going to get much worse!
I think the usa Average of unemployment will hit 10-12%.   Some states are at 10% now!  I don’t believe ANY job is safe!  Pay your bills, end the Credit crisis!

Record 31.8 million on food stamps!
The average food stamp benefit is $115 a month for individuals and $255 a month per household.

17th bank fails this year
The FDIC fully insures individual accounts up to $250,000 through the end of 2009.
The agency also projected the cost of failed banks to its fund could double from earlier projections to more than $80 billion by 2013.
FDIC might not have the funds to cover all the failing banks!

Unemployment hits 25-year high!!!!
Jobless rate hits 8.1% in February as a record-high 12.5 million people are unemployed.
The unemployment rate rose to 8.1% from 7.6% in January. It was the highest reading since December 1983 and higher than economists’ projections of 7.9%

To participate in the loan modification plan, borrowers must:

• have obtained their mortgage before Jan. 1, 2009;
• have a primary mortgage of less than $729,500;
• live in the property;
• fully document their income by providing tax returns and pay stubs;
• sign a statement of financial hardship; and
• go for counseling if their total household debt - including auto loans, credit cards and alimony - totals more than 55% of their income.

The modification program will be in effect until the end of 2012, but loans can only be adjusted once.

Officials also unveiled more details on how servicers will modify the loans. First, they must reduce interest rates so that borrowers’ total house payments are not more than 38% of their monthly income. The government will then subsidize servicers dollar-for-dollar to lower that ratio to 31% - but the interest rate can’t go below 2%.

The new interest rate would then remain in place for five years, after which it will increase by 1 percentage point a year until it reaches either the original rate or the prevailing mortgage rate at the time of the modification, whichever is lower.

If rate reductions aren’t enough to get payments to 31% of income, a lender can extend the term up to 40 years, or shift part of the principal to the end of the loan at no interest. Servicers also have the option of reducing the loan’s balance.

Servicers will receive $1,000 for each loan modified, as well as additional annual bonuses if borrowers keep up with payments. Investors will receive one-time $1,500 incentive payments for restructuring qualifying loans that are not yet delinquent. Finally, borrowers who keep up with their new payments will receive up to $1,000 a year in principal reduction, for up to five years.

The program also includes a new provision to eliminate borrowers’ second mortgages. Investors in those mortgages, who at times have blocked modifications because they don’t benefit from the adjustments, will receive incentives to eliminate those claims. Servicers that get second-mortgage holders to participate will receive an additional $250

Ok, these numbers are just that, found from google research, and a Few educated guess, but I bet they are close, and my point is still the same.

How many Houses are in the USA –  Around 128 Million
How many Houses have Mortgages –  Around 59% or 76 Million
How many are in Default or 30 days late — Tv said about 10%  or 760,000
Yes I know this does not include houses already lost.  but about 350K houses a month given back to the banks.

I see it says over 1 million homes lost in 2008, and lets say 350K for Jan, Feb, March, so another Million.
2 million homes lost.  If ALL those homes were given 50K EACH, no way there were behind that much, that would only be 100 Billion Dollars.  Maybe I did my Math wrong??? 

What I want to know is what would be the total owed to keep these houses from failing?

I guess the New administration is going to try to ban assault weapons.  Most people against guns, use the words Assault Weapons to explain even semi automatic guns.  When we hear the word assault weapon, we think in our mind a full auto AK-47.  The law that is trying to be passed is trying to ban even semi automatic guns.  People Kill People, and No criminal is going to give up his guns.  This is only taking the Legal fire arms out of legal law abiding citizens.   Here is a good Video from a Police office on good and bad weapons.  it is a 10 minute long video, but well worth the watch.

Difference between Assault Weapons and regular Firearms!

Difference between Assault Weapons and regular Firearms!

I will post the details of this later, but this sounds great!  Buy a House get Eight Thousand Dollars back on your taxes.  Well hold on a minute, all this is doing fixing the house prices at current value.  House prices have been falling for a few months now, and rightfully so.  These houses have been way over priced for years.  Now when house prices are falling, Obama slams a 8K tax Credit to first time home buyers, thus freezing the house prices, maybe even inflating them by $8,000.  Greed and Credit is what caused 99% of this mess to begin with.  Now most of these people are going to be buying a house who can not afford one, and some how Greed will find a loophole or shady lender to overlook bad credit and loan again, only to fail.

Now, I am not saying EVERYONE is in this boat, this would be the perfect time to buy a house if you can afford one.  I would of like the priced to fall a little more before this bailout of the housing market stimulus plan passed.  The time for some is ripe, Lower House prices, Historically Low Interest Rates, and well a Bonus of $8,000 for first time home buyers, if you live in the house for 3 years!