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We (USA) as a country are broke. Everyone knows this. Not sure why people think the FDIC can use the treasury as a lifeline. The treasury is like the homeowners who cannot afford their payments. They just can't continue selling treasury notes and/or print more money. Pretty soon, the odds will catch up to them and they cannot pay off their debt.
China is very angry at the US govt. They own about 700 Billion in Treasury Notes. Even they are fearful the US may not be able to repaid their debt to them.
We all will suffer for years to come (especially the HENRY's "high earners not yet rich (those making 200-500K a year) in terms of higher taxes. Even lower income people will feel the effect in terms of "higher fees" like increase drivers license renewals, higher energy "fees", or whatever "fees" govt want to collect but they just rename it just to avoid the term, "tax".
All real estate is local. No question about that.
But the orginal post offers nothing.
First, selling at a loss is better than a foreclosure. However, it may be easier said than done - if you don't have the funds to bring to the closing table it may not be possible to sell at a loss. Refinancing and loan modification are good options - if it's possible but it's not possible for everyone.
As for the post by Aneftp, I've never met anyone who was in serious financial trouble who was laughing at people who could keep their homes and pay their bills. I've never known anyone who has lost their home and considered themselves smarter than the average person. On the contrary, they have considerered it a very difficult and sad time in their lives.
Ok, I'm a little optimistic. Zillow is not the most reliable of sources but our market is doing well in the low to moderate price ranges. Homes over 300K are slow to move. Those are huge houses here. A recent PMI Corp. report stated that Fayetteville is the most affordable housing in the US in the beginning of this year. Fort Bragg with 60,000 soldiers earning lots of extra combat pay has propped up our housing market for the forseeable future.
We (USA) as a country are broke. Everyone knows this. Not sure why people think the FDIC can use the treasury as a lifeline. The treasury is like the homeowners who cannot afford their payments. They just can't continue selling treasury notes and/or print more money. Pretty soon, the odds will catch up to them and they cannot pay off their debt.
They can print more money. It will cause inflation, but they can always print money.
You won't outright lose your deposit because the FDIC fails. You will lose indirectly via inflation.
Quote:
China is very angry at the US govt. They own about 700 Billion in Treasury Notes. Even they are fearful the US may not be able to repaid their debt to them.
No, China are afraid that the US will inflate their way out of debt. Nations don't have much reason to overtly default on debt denominated in their own currency. They can always forgive their own debt because they control the money supply. Obviously, creditors don't like this very much and will stop lending if this keeps up.
Therefore, what will have to happen eventually is that this country will have to start producing as much as it consumes.
Dangit, Elford, would you quit posting this stuff? I get all excited and want to give you reputation and then it gives me the dreaded box that says I must spread it around (like manure, I guess. LOL!).
Your posts really are good. Even when we're on opposite sides of an issue, you present your thoughts in a very even handed way. Thanks for that.
You really ought to tell us where you are from so we can agree or disagree with you.
The DFW is fairly strong and overall TX home prices are up 2-4% with the top 5 selling markets in the US. So maybe a general statement like you made is appropriate for someone in Detroit.
The NAR was also telling us that house prices in El Paso were still increasing at around 5% last year. However, we finally sold and lost over 6% of what we paid the year before? Some owners, who did not drop their prices are still on the market with huge price drops and are still not selling.
Therefore, what will have to happen eventually is that this country will have to start producing as much as it consumes.
Do you think that will happen though realisitically? It would be nice if that happened but more and more jobs/industries are getting offshored to the BRIC countries (and Mexico). It's unlikely these jobs will ever come back.
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