Texas I have grown quite cynical over the past few years with respect to how our govt works and who they really work for. Press releases and official pronouncements of this program ending and this program beginning really mean nothing to me anymore. We all learned the lessons of the “this should happen” based on “these numbers” etc etc…
Going long on prognostications has grown to be really difficult given the amount of “transparency” we now have. Thus I have relegated myself to keep the predictions short term and tell clients that we have to wait and see.
The fact of the matter is that there really is no secondary market to speak of anymore. So if the fed stops buying someone else will. Maybe it will be some little known branch of the Treasury, or one of the GSEs, or some other entity that doesn’t really even exist. The bottom line is that it all ties together such that left to our own devices domestically, we have long ago decided to throw in the towel on a free market as it pertains to housing. The decision made was to kick the can down the road a few years ago so there really is no turning back. The country cannot undergo the change necessary to bring health to the market. How popular would this administration or any administration be with 9% interest rates? It cannot happen and it will not happen if it is driven domestically. Now if (when) our creditors wake up and finally this country the spanking that it needs so that we will finally understand we cannot spend our way out of debt, thinks will, hopefully correct themselves after some serious interest rate pain.
