We Are Our Own Worst Enemy !

The year 2000 came and went and the millennium bug did not wipe out all the computers like predicted. Life went on and the "I want more attitude" of our American public continued at a thunderous rate.

People started to purchase homes that they could not afford, lenders became more lenient and gave out mortgages left and right to people who really could not afford them. The lenders got creative and gave out mortgages with interest rates called ARM's (Adjustable Rate Mortgages). This is where the borrower gets a low interest rate at first but then the interest rate will rise thus making the monthly payments go up. So the people who really who could not afford to buy theses homes got in over their heads.

Crank it forward to 2005 and some serious hurricanes hit Florida, and Louisiana. 5 major hurricanes hit the U.S. and the housing boom in Florida comes to a halt. This also slows the new housing markets in the Southeast.

New housing sales and building takes a downward turn all through 2006. Also through 2006 some of the ARM mortgages are starting to raise their interest rates. The economy is starting to take a down turn and the real-estate and new housing markets are being hardest hit.

The year 2007 starts off with foreclosures across the country, Fanny May & Country Wide Mortgage companies reporting more foreclosed homes in their inventories then in past years. People with ARM mortgages are starting to default left and right as their interest rise increasing their payments to the points they can not afford them. With the declining housing markets their home is now worth less than what they paid for it, so even if they could sell it they could not break even or just a little bit behind. Many get so far behind in their mortgage payments they see no hope of recovery that they just mail in the keys to their homes to the lender.

By the start of the 4^th quarter of 2007 things are looking so bad with the real estate market and the foreclosed homes that the Fed's lower the interest rate, which drops the prime. This in turn lowers the interest rate you can get on investments, like CD's, Bonds, Treasury notes. Investors now turn to other avenues to get returns on money that they have to invest. They start investing in commodities. Oil, gold, silver, platinum, and all other hard line commodities, and other stocks suffer as the DOW drops.

We are already through the 1^st quarter of 2008 and foreclosures are up another 8.8% and the Fed's have dropped the interest rate 3 more times since last October. The price of a barrel of oil has fluctuated around $120.00 a barrel for weeks leaving the price of gas at an average of 3.699 around the nation. Because of the lowering of the interest rate and the weakened U.S. dollar it has been reported that by the years end $200.00 per barrel for oil is not out of the question, which would leave us with $6.50 - $8.00 per gallon of gas at our pumps.

Has this slowed down our consumption of gas any? HELL NO! I work at our local convenience store/gas station in the evenings and I see all of the people still coming in with the big SUV's and Pickups that take $100.00+ to fill up. And the people bitch and complain about the price of gas, but do they do anything, do they downsize their vehicle? NO! They keep driving their large vehicle and keep paying large money to fill it and the investors see this and keep bidding for higher barrel prices because they know Americans will still keep paying it.

Also where I live is in the beautiful Northeast Georgia Mountains. It is in a tourist area, and every year especially in the spring, you will see the ling up of RV's, travel trailers and campers coming to the area. Well this year has been no different, they are coming as usual, even with the price of fuel the way it is. This will not stop the investors on wall street from bidding the barrel price up. We are still consuming gas like it was $2.00 a gallon. Get out on the Highway and watch how many large SUV's that will be carrying 1 person.

The economy is in a recession. The USA Today reported last week that many college grads will have a rough go of it entering the job market. Even our dear President finally realized we have hit the "R" word (recession). The President and congress vote to give out a economic stimulus check, that would amount to at least $600.00 for some more if you had children or filed jointly. To qualify all you had to do was file for your 2007 income tax. EASY ENOUGH!

Only problem is our government did not have the money to cover this stimulus program they were giving out to us, so they went and borrowed ever red cent of it from China. Also another thing people don't realize is, this stimulus check is income, so you will have to claim it on your income tax next year.

Lastly, they are claiming that there is a world wide shortage of rice. So much so that Wal-Mart and Sam's Club has put a 4 bag limit on purchases by customers. With that and the climbing prices of other food products because of fuels costs, it looks as though things down the road this year are going to get harder and tougher for a lot of people.

We are our own worst enemy, as we have done most of this to ourselves or have let our elected officials do it to us.

Something to think about.

Put the wind in your hair and keep the sun to your backs. Be good and stay safe. Peace, Love & Prosperity to all.

Good Journey

Frank WOLF TM © 2005
Watchdog - Taking a BITE out of corruption.

Copyright © Frank J. Ball Sr. March 16^th, 2008
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