Jobs aren't there, their belief is shrinking to article lows. You find that the borrowing capacity is there it is just not happening. It isn't happening because there isn't a demand.
Lets look at real estate. Housing one of the biggest ways that habitancy in America feel like they have something. This is the way we have felt wealthy. When our houses were going up in crazy value we all felt like we had money. We all felt like we could borrow more money, and use it, and we were deluded. But right now, interest rates are the bottom they have ever been in a century. 4.5% fora 30 year loan. These are unbelievable levels. But no one is buying houses. Every person is hanging on to their money, thinking this game is not over.
Sevenfold
Now banks are selling more homes than home builders. A lot of them are hanging onto things and not even foreclosing yet, because they want to flood the store value prices and force the prices down even further. But yet arm rates, the adjustable mortgages, they need to be adjusted over the summer and fall. That means it is inevitable that there will be more foreclosures.
We have seen a 68% drop in new mortgages that have been issued. Last month, they hit a low of 1996 levels, even with these very low rates. A lot of the Realtors are a bit panicked right now. But the point to all this is that spending is not there. The stimulus holder is gone, the first home buyers grant is gone, and the store is beginning to slow back down again. This is going to result Every person in every different way.
Look at banks themselves, who are trying to make money loaning money but habitancy do not want to take loans out. Businesses are not borrowing that money right now. Businesses are not expanding, they are hanging on to everything. Trying to do this as efficiently as they can. They are not stimulating jobs. Big businesses are where most of the jobs come from in our working world.
No matter how much the fed stimulates. Even though they have bought up a trillion dollars in unmortgaged securities to bring interest rates down, the interest rates have come right back down, and habitancy are still not borrowing. If you have a look at history of what happened in Japan, back in the 90's there was a huge bubble in the real estate store and the stock market. Those bubbles shrank, and no matter how cheap it got to borrow money, they plainly turned their heads and refused to borrow it.
Consider that at present we are going through a detox. It is like we have been on drugs, called "credit" and over stimulation. Now the entire of society have to cut down, be smart. Just like detox, you have to sit down and get that poisonous venom out of your system, and it is going ot be painful for a lot of people.
Do not plainly think this is the end of the road. This is merely a seasonal change. Along the way, the smart habitancy will be able to see opportunity, even though things will get bad for a while.
If you have exposure to the stock market, and it is any exposure that matters to you. It is not in any form of food, or alcohol or tobacco, that normally goes through recessionary or depressionary times. You might think to yourself, it is time to educate myself on how to do well in tough times. You might think right now, is the right time to keep on the back foot, and minimize your risk. The stock store for example has seen major boom in 2009. In fall we are likely to see a major retracement. Please take note of this, and remember that normally after a big run up we see a important revision to the downside. You don't well want to be in a position to see your great returns hurt. You can also take up short positions on the store and make a large sum of money then the store comes down. There are many of these opportunities that are out there.
Ben Bernanke who has been talking of roses during this horrible time said these things just 2 weeks ago.
- "These are the worst labor markets since the great depression"
- "Housing remains weak, with the overhang of vacant and foreclosing property"
- "The time to come risks of unemployment is greater than normal and a majority of risks to increase as weighted to the downside "
- "Bank loans have prolonged to contract, small businesses that rely on prestige have been particularly hard hit!"
These are extremely technical terms that relays the federal support chairman is uncertain of the future.
While all these figures and facts might be depressing. There is no need to be like this. Here are 5 uncomplicated things you need to do:-
1) Today make a decision you need to take benefit of the cards that have been dealt to us. Get smart and wake up to what is going on.
2) Put yourself in a position where you educate yourself. through an organization, seminars, books, library or wherever. Learn how to take benefit of what is happening. Learn all the different tool, and techniques that when things go down, you can do well well. You need to be educated. You need to know what you are doing.
3) Get yourself some role models. Role models that know how and what to do. Role models that have done well themselves in tough times before. Perceive that in maximum time of pessimism you can make the most money.
4) Take action. One you have got your education, and implementation make sure you act on that information. This is the part most habitancy miss out on and Perceive why they are not succeeding. Make sure that you have a solid plan, act it out, and you are sure to find success.
The final message is that you need to give more than you expect to receive. If you do this during this economic collapse, the laws of the universe will come back and pay you back sevenfold. You will put your own problems in perspective and you will make your life feel more meaningful.
This is an chance to get close to our family and friends. It is a time to convert the potential of our lives for the better. And if you are smart, it is a time where you can do very well financially. Forget what others are telling you.
Furthermore, live strong, live with passion and look forward to the many challenges and opportunities that lay ahead. Good luck!
Economic Collapse - Final Warning (Part 2)
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