On The Road To Economic Recovery Or On The Eve Of A Great Depression

The following claims can be confirmed at these sites:

http://stockcharts.com/charts/historical/djia19201940.html                                                                                                           http://seansrant.com/ive-said-it-before-and-ill-say-it-again-the-decline-still-isnt-over-and-heres-why-im-short-the-djia/

The DJIA high in 1929 was 381.17. After the 1929 “crash” the DJIA stood at 198.69, a 48% drop.

The DJIA “rebounded in 1930 to a high of  294.07, a gain of 95.38 points, a nearly 50% recovery, a recovery very similar to our current recovery in 2009/2010.

The real “crash” of the Great Depression began in late 1930 when the DJIA began a decline to a level of 41.22 in 1933. Between 1930 and 1933 there were several sharp “spikes” upward, followed by precipitous drops of the DJIA.

Does our current “spike” indicate a recovery? Certainly not!

The toxic assets are still on the Bank’s books, yet the financial marklets are leading the recovery. Commercial real estate is on the brink of collapse, home mortgage foreclosures continue to climb – while the Obama mortgage assistance program has resulted in less than 2000 permanently modified mortgages – the President pledged to help 9,000,000. Credit card defaults and personal bankrupties continue to climb and the unemployment rate – incorrectly called a “lagging indicator” – continues to climb. Unemployment doesn’t lag – it is “current” – unemployment can only be said to “lag” other indicators which are actually “predicting” future activity. The DJIA current level is “predciting” that “profits” and associated dividends will be better six months from now -that ”prediction” is based on a set of “assumptions”, one of the assumptions is that unemployment will improve and not worsen. The unemployment rate predicts nothing – it is a number that “understates” a current condition.

The DJIA is not predicative of economic health.  

The following from: http://www.online-stock-trading-guide.com/great-depression-stock-chart.htm

1929-1930 Stock Chart 1   
 
If you changed the dates from 1929 – 1930 to 2007 – 2009 you’d have an almost identical set of charts. http://seansrant.com/ive-said-it-before-and-ill-say-it-again-the-decline-still-isnt-over-and-heres-why-im-short-the-djia/

1930 Stock Chart
 
1932 Stock Chart
 
 
1928-1933 Stock Chart
 
1928-1955 Stock Chart
 
 The DJIA has “zero” value in predicting whether our economic health has “turned” the corner.

AP - CHANGES headline and intro text; graphic shows total foreclosure filings for past 13 months ...

AP – CHANGES headline and intro text; graphic shows total foreclosure filings for past 13 months …The foreclosure crisis affected nearly 938,000 properties in the July-September quarter, compared with about 890,000 in the prior three months, according to a report released Thursday by RealtyTrac Inc. That puts foreclosure-related filings on a pace to hit about 3.5 million this year, up from more than 2.3 million last year.

Unemployment is the main reason homeowners are falling into trouble. While the economy is likely out of recession, the unemployment rate — now at a 26-year high of 9.8 percent — isn’t expected to peak until the middle of next year.  

http://www.charter.net/news/read.php?id=15958748&ps=1011&srce=news_class&action=1&lang=en&_LT=HOME_USNWC00L1_UNEWS 

This is after an 81% increase in mortage foreclosures between 2007 and 2008. http://www.thestandard.com.hk/breaking_news_detail.asp?id=11900

Credit card defaults up at major lenders

Over the past few months, banks had been releasing some promising figures regarding credit card defaults – but new data suggests that any signs of improvement may not be lasting.

The latest figures from major lenders implies that previous progress could be more accurately credited to seasonal factors and Americans paying down credit card debt with their tax refunds, according to Bloomberg.

Banks including JPMogan Chase, Bank of America, Citigroup and Discover all reported an increase in credit card defaults – also known as charge-offs – during August. Charge-offs reflect credit card accounts that issuers deem uncollectable.

In particular, BofA reported that charge-offs climbed from 13.8 percent to 14.5 percent last month, while Citigroup saw a rise from 10 percent to 12.1 percent during the same period.

http//www.credit.com/news/credit-debt/2009-09-16/credit-card-defaults-up-at-major-lenders.html  

What is the truth about the underlying fundamentals is our economy ……

At foreclosure auctions, broken dreams on sale

On 11:52 am EDT, Thursday October 15, 2009

CHICAGO (Reuters) – The seven-bedroom, three-bath house in this city’s West Garfield Park neighborhood had once been someone’s American Dream.

But at a recent auction of about 100 foreclosed houses and condos, it was just Property No. 20 — and drawing no bids from a roomful of buyers despite its bargain-basement price.

“Any interest in this home at $7,000?” fast-talking auctioneer Renee Jones asked the crowd. “If not, we’ll move on.”

 http://finance.yahoo.com/news/At-foreclosure-auctions-rb-853906128.html?x=0&.v=1

 Foreclosures rise 5 percent from summer to fall

US foreclosures keep soaring as unemployment remains main cause of housing woes

By Alan Zibel, AP Real Estate Writer

On 1:59 pm EDT, Thursday October 15, 2009

WASHINGTON (AP) — The number of U.S. households caught up in the foreclosure crisis rose more than 5 percent from summer to fall as a federal effort to assist struggling borrowers was overwhelmed by a flood of defaults among people who lost their jobs.

 

AP Reports, “Rising unemployment accelerates foreclosure crisis”, Economy continues downward spiral. Credit Default Rates Up.

WASHINGTON – Relentlessly rising unemployment is triggering more home foreclosures, threatening the Obama administration’s efforts to end the housing crisis and diminishing hopes the economy will rebound with vigor.

In past recessions, the housing industry helped get the economy back on track. Home builders ramped up production, expecting buyers to take advantage of lower prices and jump into the market. But not this time.

These days, homeowners who got fixed-rate prime mortgages because they had good credit can’t make their payments because they’re out of work. That means even more foreclosures and further declines in home values.

The initial surge in foreclosures in 2007 and 2008 was tied to subprime mortgages issued during the housing boom to people with shaky credit. That crisis has ebbed, but it has been replaced by more traditional foreclosures tied to the recession.

Unemployment stood at 9.5 percent in June and is expected to rise past 10 percent and well into next year. The last time the U.S. economy was mired in a recession with such high unemployment was 1981 and 1982.

But the home foreclosure rate then was less than one-fourth what it is today. Housing wasn’t a drag on the economy, and when the recession ended, the boom was explosive. (The economic recovery of the 1980’s was fueled by Reagan’s tax cuts and a shrinking of Government – a formula we won’t see from this Administration).

No one is expecting a repeat. The real estate market is still saturated with unsold homes and homes that sell below market value because they are in or close to foreclosure.

“It just doesn’t have the makings of a recovery like we saw in the early 1980s,” says Wells Fargo Securities senior economist Mark Vitner, who predicts mortgage delinquencies and foreclosures won’t return to normal levels for three more years.

Almost 4 percent of homeowners with a mortgage are in foreclosure, and 8 percent on top of that are at least a month behind on payments — the highest levels since the Great Depression.

In the last 12 months, 15% of mortgages have had forclosure completed.

http://news.yahoo.com/s/ap/20090716/ap_on_re_us/us_foreclosure_crisis_unemployment

Obama’s Trillion Dollar Mortgage Modification Program, which he promised would help 9,000,000 (9 Million), has in fact provided temporary relief to less than 75,000 (Seventy Five Thousand). Many of the 75,000 have, after receiving a modification, now slipped into foreclsoure anyway. 

Credit card defaults keep climbing

Default rates in May continue to rise as borrowers struggle with the weak job market.

NEW YORK (CNNMoney.com) — Banks continue to write off credit card debt as consumers hurt by record high unemployment default at an increasing rate.

Regulatory forms filed this week by some of the nation’s largest banks showed default rates on credit cards rose in May. The default rate is a measure of loans that the bank does not expect to be repaid.

“Data from May showed continued signs of stress for card issuers, reflective of worsening unemployment trends and deteriorating macro [economic] conditions,” analysts at Bernstein Research said in a report Tuesday.

Bank of America the nation’s largest bank, said its default rate jumped to 12.5% in May from 10.5% the month before. Other major banks, including Citigroup, JPMorgan Chase and Capital One also reported increases in May default rates.

http://money.cnn.com/2009/06/16/news/companies/credit_card_losses/index.htm?section=money_latest

Subprime Mortgages – Get One Today – Qualify For A “Cram Down” & “Mortgage Modification” Before Labor Day

If you thought you missed your chance to scam your friends and neighbors with a sub-prime mortgage loan – you know a loan you can’t afford for that bigger house you always wanted – your wrong.

Live the champagne life on a beer budget and let your neighbors pick up the tab.

Visit any of the cites below and get your sub-prime loan now ….. you still have time to default and get your the mortgage “crammed” down and “modified” before summer. Use the extra cash to buy a new car and boat ………. 

100% Financing Loans

More and more Americans are choosing to pay for their home with a 100% financing mortgage, also known as a no down payment or a zero-down mortgage loan.  This type of home mortgage frees borrowers from the worry and burden of having to gather and set aside funds for closing costs and a down payment in order to purchase a home. 

100% financing, or complete financing of the property via a first mortgage exclusively

….. we offer bad credit mortgage loans, which service consumers with scarred credit histories and “incapacitating financial circumstances”.

  • No cash is required for down payment
  • Stocks and other investments need not be liquidated to purchase the property
  • Private mortgage insurance is not required (unlike a conventional loan)
  • The greater the amount financed, the higher the tax deduction for the loan interest paid
  • The opportunity to use and/or start earning equity in the new home, instead of having it tied up
  • The ability to have their money earn interest in a money market fund or savings account
  • Diminution of their financial risk and risk-shifting to the lender [The lender shifts the burden to the taxpayer via a bailout]
  • Qualify for a bigger mortgage

Borrowers must decide whether to apply for an adjustable rate mortgage (ARM) or a fixed rate mortgage.  Eligibility requirements for the former are easier to satisfy, and an ARM offers lower mortgage rates.  [McAuley’s World – Wow, you can get an ARM and blame the lender later] 

Compare Mortgage Loan Rates:   

 

  • 100 Percent Financing Loan
  • Adjustable Rate Mortgage
  • Interest Only Mortgage
  • Subprime Mortgage
  • http://www.myhomeloanmortgages.com/rates/100-percent-financing.aspx

    Low Cost No Money Down Home Loan Solutions

    AAXA Discount Mortgage is pleased to offer fast, flexible no money down mortgage financing. The flexibility that these programs provide does not have to mean high rates and fees….  Our lenders offer highly competitive zero down home loans to qualified borrowers even if their credit is less than perfect.

    100% Mortgage Financing Programs , Creative Option to Finance Closing Costs, No Money Down Mortgage with No Private Mortgage Insurance, Adjustable Rate Zero Down Mortgage Products,  Less than Perfect Credit.

    If you are searching for the lowest payment possible, be sure to check out our interest only mortgage and option ARM programs.  

    http://www.forthebestrate.com/no-money-down-mortgage.aspx

    Zero Down Loans

    Closing costs can be financed – $250,000 to $962,000 – Credit scores as low as 580 (580 scores credit limit is $500K) – No income Verification – No Asset Verification [McAuley’s World – Get Your NINJA Loan here – No Income, No Asset, No Job, No problem]  http://www.loanshoppers.net/zero_down.htm 

    A zero down loan is good when you don’t have enough cash to pay your closing costs and make a down payment on the purchase of your home. It is also used to avoid paying Private Mortgage Insurance (PMI) costs. PMI is an additional charge you pay if you make less than a 20 percent down payment. This insurance policy protects the lender in the event of a payment default or foreclosure, and the loan is not paid off in full.

    Zero Down

    Zero down programs allow you to buy your home now, instead of waiting to save enough for a down payment.

    There are several options available for buying a home with zero down.

    Get one new loan at 100 percent loan-to-value (LTV), Some zero down programs allow you to borrow 3 to 7 percent of the purchase price to pay your closing costs. WE MAKE LOANS NOT EXCUSES!!!    http://landmarkmortgagelending.com/zero_down.html

    CHOICE FINANCE

    Question
    Can you please tell me more about the zero down option on the mortgage loan program?  which types are they, what kind of credit score does it allow for?

    Answer
    There is a lot of information regarding “zero down” mortgage programs. There are some great programs backed by Fannie Mae and Freddie Mac (these are the 2 government backed giants that control the industry) with great interest rates and credit requirements that don’t have to be sterling.

    I’ll give you an example: a borrower could have a 650 credit score and qualify for a “zero down” program backed by Fannie and Freddie. The rate would be approximately 6.5%.

    However, here’s another example: a borrower could have a credit score of 580 and no longer qualify for Fannie and Freddie but would be able to obtain 100% financing with well respected, publicly traded (NYSE or NASDAQ) companies. But the rate would be higher. [McAuley’s World – The rate is only higher until you receive your “mortgage modification” when the rate is written down to 2.5% and have your “principal crammed down” too ….. let your neighbors pay for the reductions through higher taxes – you can’t beat this deal with a stick]

    http://www.choicefinance.net/blog/tag/zero-down-financing/

    100% Financing No Down-payment Mortgage

    http://www.erate.com/100_percent_financing_no_downpayment_mortgage.htm

  • No Cash needed for down payment
  • Don’t need to liquidate stocks and other investments
  • Borrower may want to finance as much as possible for tax deduction purposes. 
  •  Debt ratios of 45 or less  [McAuley’s World – Don’t worry – after default or modification – the Governemnt will write you down to a 31% debt ratio while your neigbors pay the extra 14% for you] 
  • Zero Down Home Loans
    Home Purchase Loans – 100% Home Financing – No Money Down

    Zero Down Home Loans are offered to consumers with good and bad credit for 100% financing. We practice fair lending with 100% financing for conventional, home purchase loans, sub-prime, pick a payment loans, jumbo mortgages, negative amortization and interest only loans. 

    “Many people in California are finding the best way to get a low monthly payment is with the 1.25% negative amortization loans that allow borrowers to defer the interest until the end of the year. These payment option loans offer borrowers a payment that is even lower than the interest only payment. The negative amortization option is only available until the mortgage balance reached a 115% or 125% of the original mortgage balance depending upon the lender.”  [McAuley’s World – This loan will qualify you to move to the front of the mortgage bailout line – a zero down loan – to people with bad credit – with  less than an “interest only payment due” until you default – What a mortgage! With this mortgage a Municipal Bus Driver making $35K a year can mortgage a Million Dollar Home at Taxpayer Expense – What a Country we live in! Free Million Dollar Homes Paid For By Your Neighbors Taxes!]

    http://www.lendamerica.com/

    BD Nationwide Mortgage Introduces the Second Mortgage that Requires NO Appraisal for Home Equity Loans to 125% and Refinancing Credit Lines – “According to Citibank executive, Jim Markham, “Having the ability to use the AVM model is a Win-Win scenario for mortgage brokers and homeowners across the country. Mortgage brokers can increase their second mortgage volumes and borrowing consumers benefit from reduced costs and quicker loan processing cycles.” [Why would Citi care as long as Taxpayers keep “recapitalizing” the mortgage losses through TARP. “Appraisals” Are No Longer Needed For A “Mortgage Modification” at taxpayer expense – borrow as much as you want – you won’t be paying it back anyway]. http://www.bdnationwidemortgage.com/zero-down-home-loan.html , http://www.prweb.com/releases/mortgage/loans/prweb470912.htm 

    LOAN BIZ

    100% Zero Down Finacing – 125% Zero Down Home Equity Loans – Interest Only and negative amortization loans available. http://www.loanbizinc.com/

    Hurry, it’s not to late to get in on the scam – purchase a larger home or refinance your current home now. Default before Memorial Day and get your “Mortgage Modification” and “Cram Down” by Labor Day weekend.

    Why settle for a house you can afford when your neighbors will pay for your upgrade?

     Don’t settle for second best – go right to the top – http://www.acornhousing.org/TEXT/mortgage1.php – “Flexible credit guidelines and income requirements including the use of non-traditional income” – (Yes, welfare payments and food stamps can be used as income qualifiers.) ” We are very pleased with the level of commitment that CitiMortgage, First American and Fannie Mae are contributing to this effort”,  said Alton Bennett, President of ACORN Housing Corporation. Since its inception, AHC has provided free services to 250,000 households across the country, more than 80,000 of which have become homeowners, generating more than $10 billion in mortgages. 

    With AHC you get:

     Data from the Mortgage Bankers Association shows that a stunning 48 percent of homeowners who have subprime, adjustable-rate mortgages are behind on their payments or in foreclosure. http://news.yahoo.com/s/ap/20090305/ap_on_bi_ge/states_foreclosures 

    LET CONGRESS KNOW WHAT YOU THINK – http://www.usa.gov/Contact/Elected.shtml 

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