10.03.11 (Part 2) Real Estate Radio With Louis Cammarosano

Ryan notes that there is money to be made by lending and wonders why banks are not doing so. Louis notes that its easier and risk free just to invest the money in US Treasuries and make money instead on their trading operations. Louis notes that its hard to determine the solvency of US banks. Louis notes that mortgage debt is not being liquidated but rather is being traded among the banks and government sponsored entities. Ryan notes that there are still a large number of foreclosures in the market and more coming. Louis notes that the policies designed to prevent the housing market from collapsing are just prolonging the pain. Louis notes that markets needs to collapse in some instances. Louis notes that not only is stimulus not working it is also adding to the debt. Ryan discusses the implication of the Greek debt crisis and notes that investors react by purchasing US Treasuries which has the result of keeping interest rates low. Louis notes that Europe is not yet allowing Greek debt to default. Louis notes that the kicking the can down the road and making the road longer doesnt change the fact that the road is a dead end. Louis notes that low rates and stimulus are not the answer. Louis notes that the DC metro area benefits from and will continue to benefit from a robust job market due to plentiful government jobs and government contracts with no plan on the horizon to cut Federal spending. Louis expresses no faith that the 12 member Congressional committee will come up with meaningful cuts and concludes that the DC metro area job market will continue to do well. Ryan expects the national unemployment situation to get much worse. Louis notes that even if the layoffs subside doesn't mean that hiring will begin. Louis also notes that the unemployment rate doesn't count people who have given up looking for a job and for the long term unemployed. Louis notes that young people are unemployed in greater percentages and this is preventing them from getting job training and they have college loans which makes their situations more untenable. As a result younger people will be deferring home purchases.

Category:

News & Politics

Tags:

• unemployment
• U.S. Treasuries
• foreclosures
• short sales
• austrian economics