Bernanke pours cold water on Mortgage hopes!

It seems that the end is not yet near as one may have hoped, for according to Bernanke, the mortgage crisis is far from over. For those of you how are wondering who on earth is Bernanke and why on earth should we even bother to listen to him? Well, for your information, Bernanke is none other than the Fed chief and his analysis carries a lot of weight and is much more on the mark than what you or I would have to say on this matter.

According to Bernanke the crisis is far from over and that the government may have to take some more remedial measures to help calm the waters. Of course, the query on every one's lips is what does this mean for us the common man on the street? Well, for one thing, do not go near the stock market for the next couple of days as the market sentiment is quite down and other than that, to keep an eye out on home prices since they are dropping you may actually get your hands on a property that is worth much more than what it is being sold for.

Bernanke wants the foreclosures to be either stalled or written off at least partly as such a move would bring stability to the markets. What ever else that anyone may have to add on this, one thing is for sure, the ride is far from over and that there is more excitement to come!

Fed announces new plan to rescue mortgage defaulters!

This is a good move by the feds and may well stop the unemployment rate in its tracks, well; it may not stop it altogether but should at the least lessen it. This is indeed a very good move for many reasons, for one, it should take some of the bite out of the current mortgage crisis that seems to be facing the American markets.

What many people do not seem to have considered is that if all the mortgage defaulters were thrown out of their homes, then the various companies would not be all that eager to hire them. Everyone must have a real address that they can call 'home' so as to get legally employed.

So if a defaulter was to be thrown out of his or her home, then that person, by law cannot be gainfully employed and would probably be begging a living under one of the overpass.

This move by the Fed is one that should have been taken a long time ago, but then again, it is better to be late than never.

With the current mortgage crisis spiraling out of control the next move by the fed should aim at regulating the housing markets and after that, the fed should concentrate on the banks and pressurize them to increase lending so as to prevent any further credit crisis from hitting the consumer on the street. It is a long way to go and the first step, the most important one has finally been taken by the Fed today!

Wall Street floating on high expectations!

After the Friday losses, a badly shaken Wall Street is keeping its hopes up in anticipation of another slash in the rates by the Fed. It seems that these days the market seems to follow a philosophy of 'one day at a time'. The recent dismal showing by the housing market is still setting waves in the industry with more and more banks introducing more and more stringent rules regarding loans. Let us just say that the lending part by the banks is going to become less and less for the near future.
With such a poor showing and a fall by more than 26% in the sales of new homes, the markets reacted with a 'knee jerk' reaction. That is only to be expected.

But would the Fed slash rates this soon and if they do so, what would be the impact on an already weak Dollar? Wouldn't there be a free fall? As it is the Dollar has lost so much of its value against a host of major currencies and today it holds supreme only over those currencies whose rates are still stringently controlled by their central banks. My two bits is that the Fed would slash the rates but it may not come as early as the wall street thinks. It would probably happen around the end of the fiscal year, thereby giving the new Financial year a boost as well. But then again, it may happen soon, either way, it is time for a martini, dry, shaken but not stirred!

The world markets reels from Recession fears!

It is that time of the year when we all get to eat the 'humble crow' and tell all the pessimists that they were right all the time and that recession is indeed setting in. The Bush administration thought that they could hold the recession at bay with their stimulus plan and it seems to have backfired miserably.

The unveiling of the plan sent many an investor running for the hills. Lets face it, even if Bush had managed to come with a fantastic plan, the current one is not that bad, even then, it would just not be enough. Once the financial markets decide to recede, there is nothing much anyone can do but to bite ones teeth and go for the ride! That is all about what one can do at times like these!

With the Fed cutting rates at the drop of the hat, the Dollar is taking quite a beating across all of the world markets. What is more, with the Dollar no longer supporting the Oil, the prices are shooting up day by day. And the only good thing that is there for the investors to invest in, what seems to be the safest bet of all is none other than the famous 'yellow metal'. So, if you are an investor, this is where you should be heading!

Wall street in a muddle over the economy!

The Wall street seems to be heading to a muddle over the anticipation of how the U.S economy fares next week. The investor reports as well as the housing data are to be released soon and it could go either way. Goldman sachs had reported profits in the last quarter and they are expected to do the same as their Q4 reports are due soon.

But as far as the markets go, and with all indications that the inflation is due to go up and in only one direction, the mood is all about 'a half glass that is all too empty'. The Fed cannot do much as with any inflation rise, their hands get tied down , so any negative data especially in the Housing data is bound to send the markets into another free fall.

Citigroup chief economist Lewis Alexander said he believes the housing market will remain weak well into 2008, but that it is more likely that the economy will keep growing than head into recession. I have to agree with that outlook but I also have to say that saying that the economy will keep on growing in spite of the housing market seems to be hiding ones head all too deeply in the sand. Maybe it is high time that the price ranges were regulated in the housing market but any such controls will only have negative implications for the U.S economy and the U.S dollar.
There is no easy solution to the current mess and this is one ride that we all will have to ride whether we like it or not!

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