Back to Basics

David Rosenberg, market guru, has officially declared that the US economy is in a state of depression, and he sees the economic superpowers woes worsening.

On the heels of that bleak forecast, the statistics for existing home sales for July were released and the numbers were ugly. The weak housing market collapsed. Reflecting the worst slump in American history, existing housing sales had plummeted a stunning 27 percent and there’s no sign on the horizon that sales will stabilize any time soon.

The bottom line, argues Rosenberg and others: the US economy has collapsed into another Great Depression.

Citing the period from 1929 to 1932 and the eerie similarities, Rosenberg said, “We may well be reliving history here. If you’re keeping score, we have recorded four quarterly advances in real GDP, and the average is only 3 percent.” The same happened during the early 1930s stock market rebound of 50 percent after the 1929 crash.

The Great Depression followed the brief economic upswing.

As long as two years ago, one of Britain’s top economists predicted a decade-long depression, $45 trillion in debt defaults and unemployment in the US and UK approaching 25% or higher.

During October 2008, economist Fred Harrison told the Foreign Press Association in London,”"The massive contraction in demand caused by this ‘wealth effect’ will condemn the western economy to a decade-long depression.”

So let me get this straight. I come to work everyday to make sure I earn the money to support my family and pay my mortgage. All the while the government has given, and is giving, home loans to people who can’t afford it and won’t make the payments. So now the government is asking taxpayers to bail out the very entities that hold these loans. So in effect they are going to transfer my wealth to someone/something else because the government thought is everybody is entitled to a home. Thank you very much Barney Frank. You and your liberal cronies who created this housing mess are a disgrace. More goodness from CNBC:

For American taxpayers, now on the hook for some $145 billion in housing losses connected to Fannie Mae and Freddie Mac loans, that amount could be just the tip of the iceberg.

According to the Congressional Budget Office, the losses could balloon to $400 billion. And if housing prices fall further, the cost to the taxpayer could hit as much as $1 trillion.

Two things are clear: Taxpayers don’t want to foot the bill, and Fannie and Freddie, taken over by the government in 2008 to stanch the financial bloodletting, need a major overhaul.

“Some of us who don’t even own homes are paying to support others and their home ownership, and they ask ‘why?’ said Robert J. Shiller, a Yale University economics professor and co-creator of the S&P/Case-Shiller Home Price Indices.

Barack Hussein Obama was handed the Nobel Peace Prize because he accomplished what no other President of the United States could; namely, dismantling this Nation as a free and prosperous country, all the while undermining America’s strength to protect her people, and those in the world who have relied on the United States.  You have to be ignorant or an ideologue, like Obama and company, not to see this.  He has gone to great lengths to “change” America into a country in which the European and socialized/Marxist leaders across the world are beginning to like.

America worked and fought diligently to become the “shining light on the hill,” and for 230-years, the United States of America has been a beacon for all who chose to escape tyranny; a helping hand for all who required the strength and resources this great Nation developed; a protector for those who were assaulted by bullies; an example of innovation and reward for disciplined work.  In less than 230-days, Mr. Obama began to weaken just about every facet of America.  But “his work” is not completed, and he continues to march this country into a great abyss.  Partially from ignorance and naïveté, partially from incompetence mixed with narississim, and add a very large table spoonful of radical Marxist ideologue, this man is making a country not at all in keeping with the very heritage he swore to uphold and protect.

Mr. Obama swore an oath (I suspect fraudulently) to preserve, protect, and defend the Constitution of the United States.  When he spoke those solemn words at his Inaugural on January 20, 2009, within hours he systematically began to violate his pledge; his sacred oath.  I believe he intended to do so from the moment he finished his Inaugural Speech.  Just study his actions since becoming president.

He signed orders to alter and greatly weaken the intelligence community.  He set in motion the machinery to treat terrorists as if they were merely on some crime spree, rather than confronting them as the cold and menacing war mongers they are.  He orchestrated the largest debt this country ever experienced; he nationalized banks, industry, and education, while severely weakening private business, housing and corporate sectors.  He is creating the largest government in the history of this Nation, and he further has directed this obese government to become more aggressive towards the very citizens the government is sworn to serve.

Mr. Obama’s verbal smoke-screen of non-violence and peaceful resolutions is, in truth, a “call-to-arms” by the government he leads to repress then smother freedoms, 36-czars and growing; create a two-class society; “the haves” and the “strugglers.  Food, energy, fuel, and medicine all are under the control of a calculating Washington, D.C. government in which Hugo Chavez, Fidel Castro, and other Marxists could be proud.  And Obama and company are not finished!  Watch for new domestic security forces to be created.  Prepare for such hyperinflation that food and fuel will become scarce and rationed.  Get in line to receive government handouts in place of finding a job in the private sector, and come to realize that many occupations and careers are forever gone; I don’t know what colleges and universities will do to prepare graduates for the “changed America” Obama is creating.  Office complexes will become ghost-towns; better used as housing for the increased homeless.  Many resorts will become more exclusive and less accessible as a chasm grows between “the haves” and “the strugglers”.

The United States of America is under siege!  This is NOT a drill!  These are NOT reactionary words tossed about recklessly.  A “Trojan Horse” has been delivered to 1600 Pennsylvania Avenue in Washington, D.C.

Everyone is aware of the democrats’ bill to take over health care, but there has been little attention given to another government take over – Cap & Trade.

I read some of this massive bill and found hundreds of pages dedicated to dictating what types of light bulbs will be available for use.  Naturally, certain areas would be exempt from these mandates, including Las Vegas and California – I wonder who represents those states!  Not quite understanding what all the fuss was over light bulbs I started speaking with others and was amazed at what I learned.

The new energy efficient light bulbs (CFL’s) contain mercury, which makes them hazardous waste.  Along with this comes special handling when replacing bulbs, disposing of bulbs and if a bulb breaks.  If you do not have recycling options for CFL’s then you will have to seal the bulb in two plastic bags and put them in the outside trash.  I spoke with someone who works for an electric company and he told me that the bulbs cost about $15 each to dispose of.

Beware if you break one of these bulbs, because of the mercury the EPA has issued recommendations for cleanup and disposal.  These recommendations include opening windows, shutting of central heat or air and leaving the room for 15 minutes or more.  All broken pieces need to be scooped up using cardboard and placed in a glass container with a metal lid or sealed plastic bag.  Then use duct tape to pick up any remaining pieces.  If the breakage was on carpet you can vacuum after following the instructions above and then you must remove the vacuum bag and put that in a sealed plastic bag.  If clothing or bedding is affected, they recommend throwing it away because washing the clothing or bedding may contaminate your washing machine and pollute sewage.  This is all because of the mercury in the bulbs.  They also recommend the next several times you vacuum that you shut off the heating or air conditioning and open a window before vacuuming and keep it off for at least 15 minutes after vacuuming is complete.

So the bill to “help” the environment and reduce greenhouse gases would mandate that we use hazardous light bulbs that obviously pose a health risk, a contamination problem and a possible pollution problem.

I also discovered the bill will permit government officials to enter your home and evaluate and rate how energy efficient your home is.  The bill requires new buildings to be more energy efficient by 30% by 2012 and 50% more efficient by 2016.  For new construction these new energy guidelines can be included, at an increase cost to the home.  So while the housing industry is already in trouble the government is going to “help” by putting more mandates and controls on the industry.

But, we cannot forget about all the buildings, commercial and housing, already in existence.  They will also have to meet these new standards; otherwise you may not be able to sell your home.  Under these new requirements, a government auditor will be allowed to enter your home and inspect your windows, appliances, air conditioning, furnace and anything else to make sure your house meets these new national building codes.  Not only can they inspect it, but they will be able to mandate that you provide the necessary remedies within a specified amount of time regardless of the cost.  They are going to make funding available to help retrofit these homes in the form of loans, but this funding cannot exceed 50% of the actual costs incurred.