Didnt we just go through a period where a branch of the Government stepped in and bought down morgages to unheard of levels? Wasnt the target 4.5% and we got to 4.8% or something like that? Strange, it didnt fix anything, must of not been big enough. Lets do it BIGGER next time, that’s the trick.
So lets say it goes to 4.25% and everybody refi’s and is all happy and such cause they have hundreds of dollars extra every month to blow on Chinese and Japanese imports. House sales go through the roof, housing stops declining, Target and Wal Mart start hiring like mad and everything is just peachy! Yay Stimulus! Mission Accomplished! We can dress Ben B. in a flight suit and have him flown out to a cruise ship filled with boomers all taking a retirment vacation with their “unlocked” equity and a great big sign saying something like “IT’S ALWAYS A GOOD TIME TO BUY!” Itll be a ratings hit and Yun will be there as a commentator the entire time. No one wont buy a house.
Cept, then we stop stoking interest rates and they go back up to atleast 6-7% (50%+ increase in rate BTW) due to the skyrocketing level of inflation induced by our 2 TRILLION dollar a year deficits (900b stimulus + 1T in defict spending in 2009, plus who knows what else is at hand, it is only Feb.) and massive money supply increases. This makes new buyers unable to buy due to NORMAL interest rates and BS jobs at target or the Outback serving shirmp on the barby and blooming onions.
Then guess what? Housing has to fall as itll be unaffordable again. Plus we will have trillions of new debt to pay back with taxes on our service sector jobs paying minimum wage plus tips. But who cares? We are only paying 4% on our Morgage!!!!
Yay Stimulus!
