The Federal Reserve is not helping
10-14-2010 09:51 AM
The Federal Reserve is not helping
The Federal Reserve just announced they were going to try to help the economy again. They will lower interest rates again and buy more Treasury bonds. Can some one tell Beenanke and Timmy Geitner it isn't helping.
First off the interest rates have been at record lows for the past year or so. They keep lowering the rates and people still aren't buying houses and taking out loans. For the average consumer its because they don't have a job. The ones that do have a job can't get a loan with these record low rates because the qualifications have gotten much tighter. Which if they were this tight 10 years ago, we wouldn't have had the housing bubble burst. Case in point. My buddy spent 18 months trying to get a mortgage in Greensboro, NC. His credit score is the highest its been in 10 years. Makes more money and has more in savings than ever before. Twice he was preapproved by Bank of America and put contracts on a house. Not times, BoA changed their mind 1 WEEK before closing for random arbitrary reasons. One was he was late on a mortgage 7 years ago. The requirement was current for past 2 years. The other reason was they didn't like his savings "history" even though he had $11,000 in savings. He was only trying for about $300,000 mortgage, so nothing crazy. And the house he was trying to get had been on the market for a year, so it screwed the seller too. He was denied closing before the tax credit deadline because a random bank employee. So lowering the rates isn't helping because people aren't borrowing money and the ones that want to can't get the loans. If the housing market was booming with 6.5% rates, the interest isn't what's holding people back.
Another example is a statement made by another friend yesterday. He said his house has been on the mrket foe 7 months and is desperate to sell it. He said he hopes the lower rates will bring more people that weren't buying last week. Well another quarter point reduction in interest ISN'T what's keeping people from buying.
Now to the Treasury bonds. The Federal Reserve is printing money. Since many countries have stopped buying T bills, they re buying gold. The sale of T bills is part of what maintains the value of the dollar. Since countries aren't buying, the Fed reserve decides we will buy them. But the inherent problem is when you buy T bills with worthless paper money that you keep printing it doesn't help. If buying of Treasuries wasn't vital to the value of the dollar the govt wouldn't care that other countries aren't buying them. Now when you buy them with printed money, obviously the value will keep going down.
Case in point is when the top Democratic financier, George Soros, pulled his money out of the market and bought Gold with it. It should raise a red flag. Like when the CEO of a company dumps their stocks of their own company, they know something bad is going to happen.
10-15-2010 01:03 AM
great read here indeed doing this will not help the problem.
10-15-2010 08:29 AM
North America needs to keep jobs here and not give they to China and India. This is sooooo stupid. the only one benefitting is China. There has to be some sort of protection against this. China writes their own rules and laughs at us while profitting trillions because politicians are controlled by big business so they can have their products made cheaper and cheaper so their bottom lines get better and tgeir CEO' gaet paid more. We need a revolution here. Politicians must stop working for the Corp and start working for mainstreet or they should be imprisoned for treason.
10-15-2010 10:20 AM
Remember the evil incandescent light bulb? The greenies pushed CFL for years. The problem is CFL's are not made here. Just recently GE closed the last factory in the US to make incandescent bulbs and shipped those couple hundred jobs to guess where? China. But the american greenies are "saving the planet" yet destroying the United States in the process.
Originally Posted by luclyluciano
10-15-2010 01:17 PM
And my question is.....why are the CFLs NOT made here? Bad trade policies favoring the rich corporations and screwing the middle and lower class. These globalization and so called free trade policies are destroying the jobs base here permanently unless riots start to happen and polititians get incarcerated for accepting corporate bribes. Voters need to unite and rise up and take action and not feel there is nothing they can do.
Originally Posted by youngandfree
10-18-2010 09:45 AM
This is only true if 'the problem' is getting the economy back on track and turning the US into a place that produces jobs and goods and services again. 'The problem' as far as The Fed, the federal government, and Wall Street banksters are concerned, is transferring more wealth from the poor and middle class into their pockets. To that end, more quantitative easing will go a long way and while unemployment holds or rises and jobs bleed out from the country and the rest of the citizenry takes it up the ass, the financial sector will continue to post record profits, salaries and bonusses.
Originally Posted by mich29
10-19-2010 01:31 PM
The situation with the economy is not going to get any better. Just like when gas prices started to surge,and swell too 2.00 a gallon and rising. We all thought that would be the "flavor of the month" but it hasn't got any better either--we just got used to it.
The Untied States is no longer a country--it is a business,and our hopeless politicians run it as such,selling away this country,and it's businesses piece by piece to the highest bidder.
10-20-2010 08:55 AM
Short term, probably not. But Adam Smith had it right on at least one issue, to paraphrase: the inherrent drive of all people to try and improve their situation in life through productivity and serving one another's needs is more often than not more powerful than the repeated attempts of others to **** up the positive benefits of such actions. In other words, no matter how bad the collapse civilization, meaning free people interacting peacefully, is the most powerful long term force in human affairs and eventually we always come back and come back stronger. It just sucks to live in the trough times as opposed to the peaks.
Originally Posted by airram479
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