Mark's weekly blogging

I have been listening to all the news channels for days now. 

I just have one question: 

What world do these people live in?

I do not know about all of you but all of my friends, family and neighbors are all feeling the effects of an economy that is definitely more challenged today than it was several months ago.

Gas prices are much higher!  Food prices are much higher!  General everyday expenses are higher for all  of us because our revenues have slowed, home values have gone down, interested rates have gone up and there are simply not enough qualified buyers available to buy homes.

SO WHY ARE THEY SAYING THE ECONOMY IS OK!!!???

The worst part of this is that the general public is buying the story hook, line and sinker.  How? Why? What is everyone thinking?

Do you know they have actually said the down turn in our housing markets will not have an impact on our overall economy.  How is that possible when they have said for 3 years that the housing and mortgage markets have absolutely been the driving force behind strong economic growth. 

What are your opinions?  I would love to hear them.

Keep sending your deal files and lets take advantage of the rate cuts while we can..

I was teaching my son how to ride his bicycle without training wheels the other day, and he fell hard!  Craig was so mad at me for having made him hit the ground so hard it was not even funny.  In between tears and kicking at me he asked why did you do that daddy?  So let me tell you what happened...

I was holding on to him, as any good father does while letting him get comfortable with his own center of gravity.  We than began to work on the principle of momentum and speed.  My son was learning that the faster you go the easier it is to balance yourself provided he follows the basic fundamentals of balance.  I had not done a good job of teaching him the fundamentals because going faster just meant he hit the concrete pavement with a speed and force that even made me cringe.  THANK GOD FOR HELMETS: A skinned elbow a small road rash on the tip of his nose and off to the pool we went.  No more bike lessons for a few days.

You are probably asking yourself what any of this has to do with finance?

The Fed is doing the same thing to the consumers that I did to my son only I think the outcome will be much more disastrous. Allow me to explain:

Several weeks have gone by with a stock market that is capitulating quite radically because of tremendous volatility in the housing markets brought on by improper lending practices brought on by...  you get the picture.

What does the fed decide to do when the whole world looks like it will collapse, They reduce interest rates!  This increases the velocity of the dollar or (Increased cash flow) which they hope will allow the economy to stay afloat until they can get the balance back.  The problem is the fundamentals are not there. I want you to picture the economy as the bike, us as the rider and the fed as the instructor.  We were not doing very well on the fundamentals and yet the instructor decided to push us faster so we could overcome our balance issues.  I know what my son knew and I did not think would happen: When we hit the ground it is going to hurt.

Unfortunately, the general public has no idea.  They think a reduction in rates just saved them money!@#  Does any one realize it takes about 9 months for the effects of fed policy to show up in the economy at our levels. 

The feds policy shift in interest did not benefit us today.  It benefits Wall Street, Banks, Money Managers and Big Business but not us the little people.

Imagine operating your home or business with a deficit that you could not overcome in 100 years.  Please also imagine that the person who made the decisions to put you in that position financially to begin with is still making key decisions.  You see the "Have Nots" would be stuck filing bankruptcy, going through foreclosure and sitting on the doorstep of financial ruin... "The Haves" they lower interest rates so you will give them more money, they do more land development projects forcing down existing values on properties, they destroy the environment, fill in lakes, and just simply eliminate natural environmental processes if it gets in the way of them making money.  The end result is they still make all their money and we sit here having to foot the bill for their greed. 

My son had a right to be mad at me, I should have known better.  Will we have the right to be mad at anyone other than ourselves when we fall? 

These are simply my opinions and not neccesarily proper or accurate, I only hope to cause people to better educate themselves and their clients so we lend money where it makes the most sense.

Mark

I hope everyone has enjoyed the long weekend and is now back in the office working to get business closed before the end of the year. Today we will be providing a resource, strategy, and advice on a subject that seems to be a very hot topic today.  We have seen an increasing number of borrowers coming to us who are un aware of what has been placed in their credit reports.  The masses as a whole seem to be un aware as well that the credit bureaus are changing the scoring models this month as well. (Might not show an effect until next month)  We are seeing many people with there scores changing radically in this time period.  Please take time to read up on how to help you and your clients become informed about what is in your credit reports.  Can you say "What's in your Credit Report?" LOL Have a great week!

Reality Or Urban Legend?

We’ve all seen the commercials that advertise a free credit report. Unfortunately, as we have all come to learn – nothing in life is free. Many companies want you to sign up for a credit monitoring service. But WAIT-Federal regulations are in place requiring the 3 major credit bureaus to provide one free credit report each year. Our recommendation is to request one bureau report every 4 months. This way you get a credit report 3 times a year (once from each bureau). Help protect your self against identity theft.

To Request by internet go to: www.annualcreditreport.com and view your report instantly.

To request by mail send a completed request form (www.ftc.gov/credit) to:

Annual Credit Report Request Service

PO Box 105281

Atlanta, GA 30348-5281

To Request by phone call: 877-322-8338

Thank You

Mark