Housing Bill to Destroy America!!!!! and NEW HomeBuilders
WASHINGTON -- House and Senate leaders have largely hammered out a compromise deal on a mammoth housing package that would permit the government to bolster Fannie Mae and Freddie Mac in an emergency, overhaul supervision of the housing-finance giants and allow the government to insure up to $300 billion in refinanced mortgages.
The housing bill as proposed is going to ignite the printing presses of the Federal Government. Get ready for interest rates to skyrocket and inflation to go out of control. Demon that's for you. The problem is that higher interest rates is going to raise mortgage rates and NEW HOME BUILDERS will get killed.
There is over $12 Tillion in mortgages. $300 Billion provision for guaranteeing mortgage refinancing is less than 3% of outstanding mortgages. We already have over 1 million homes on the path to foreclosure. Remember, mortgages are defaulting because people can't afford to make their mortgage payments and/or sell their homes for the balance of the mortgage.
Higher interest rates is only going to bring down the value of houses further. It is falling home values that is prohibiting many from selling their homes and paying off their mortgages. This package will only accellerate the decline in the value of homes as interest rates rise. It is absolutely insane.
How short sighted can our lawmakers be? As the world sees we are going to start printing dollars out of control....they are going to start dumping dollars causing the dollar to devalue further. Import prices, including oil, will skyrocket....anyone ready for $8 per gallon gas???
Finally, out of the $12 trillion dollars in mortgages....who is going decide which $300 billion get refinanced and guaranteed. What incentive will your neighbor, who is working his ass off to stay current, continue to pay his existing mortgage when he can simply default and get a better deal?
Anyone see moral hazard folks?
$300 Billion of EXISTING mortgages? How about $3 Trillion or more!!!!!!!
No one will want to buy a new house with a new mortgage because home values will be crashing in value as interest rates skyrocket and jobs are lost.
If this bill passes we are screwed......all of us. Dollar crashes, interest rates skyrocket, houses and investment assets implode in value, inflation goes out of control, umemployment explodes, construction stops completely, and you can figure out the rest!!!!!!!
Watch what the 10 year bond does today just on the rumor of the package.