Real Estate Reality Check™ - Building Wealth in Real Estate
Donald Trump called for a ‘total and complete shutdown of Muslims entering the United States’. It’s common sense to do so, because–as a country–we are now at war with Muslim terrorists.
After all, former Democratic President Jimmy Carter did the very same in 1979. He banned Iranians from entering the United States. So, the outrage which Donald Trump encounters, is just a baseless left-wing hysteria.
Billionaire Chinese entrepreneur Guo Guangcheng, who is like a Chinese clone of Warren Buffet, has apparently vanished. As a result his companies halted share trading ahead of an expected announcement about his fate.
The story sheds light on China’s oppressive system, which tends to label dissidents and business tycoons as corrupt in order to have a pretext to easily dispose of them.
While both the S&P/Case-Shiller Report for August and September 2010 Existing Home Sales Report by the National Association of Realtors are painting a gloomy picture of the real estate market, the Fed is embarking on a large-scale purchase of long-term government debt, presumably in an attempt to keep long-term interest rates lower than they would otherwise be. This entire operation has been dubbed QEII (quantative easing part two).
Why don’t we feel like the Fed is doing us a favor?
The purchase of long-term debt of the U.S. federal government is being paid for with short-term debt issued by the Fed. Does it make any sense to you?
If the Fed is desperate enough to pay with short-term debt for long-term debt in hopes of reducing effective long-term interest rates, it could only mean one thing: China may have reconsidered its role as the lender of last resort. It doesn’t take a rocket scientist to figure out that any uptick in mortgage rates would have a devastating effect on home sales.
One major reason the Fed cannot afford to allow for interest rates to go up are ARM loans, which are a time-bomb waiting to go off.
A quick read: Why The Fed’s Adventures With U.S. Government Debt and China’s Interest In Natural Resources Could Flare Up Inflation