http://www.mybudget360.com/if-incomes-are-down-where-is-the-economic-spending-coming-from-industrial-production-still-lower-credit-contraction-and-average-work-week-at-record-low-wells-fargo-considering-converting-option/ Investing ideas for preserving wealth in a fluctuating market. Sat, 13 Mar 2010 01:35:24 +0000 http://wordpress.org/?v=2.9.2 hourly 1 http://www.mybudget360.com/if-incomes-are-down-where-is-the-economic-spending-coming-from-industrial-production-still-lower-credit-contraction-and-average-work-week-at-record-low-wells-fargo-considering-converting-option/comment-page-1/#comment-15931 Concerned Citizen Thu, 12 Nov 2009 18:43:15 +0000 http://www.mybudget360.com/?p=1390#comment-15931 This analysis is spot on. As you said, the dollar is going to continue to decline by design. And the Wells Fargo policy of refinancing the Option-ARM loans only postpones judgement day. Well over half of the homeowners with those loans are underwater -- many of them will strategically default (mail the keys to the home to the bank -- "jingle mail") because it makes more economic sense than to keep paying for an asset for the next 6 or 10 years that isn't worth even the loan balance. As Edward commented, equities could keep going up, even though the economy and real estate perform badly. During the Weimar hyperinflation, the stock market did well for stocks that had assets, it was just another way to own the asset. Gold and foreign currencies did best. More at beforeitsnews.com. This analysis is spot on. As you said, the dollar is going to continue to decline by design. And the Wells Fargo policy of refinancing the Option-ARM loans only postpones judgement day. Well over half of the homeowners with those loans are underwater — many of them will strategically default (mail the keys to the home to the bank — “jingle mail”) because it makes more economic sense than to keep paying for an asset for the next 6 or 10 years that isn’t worth even the loan balance. As Edward commented, equities could keep going up, even though the economy and real estate perform badly. During the Weimar hyperinflation, the stock market did well for stocks that had assets, it was just another way to own the asset. Gold and foreign currencies did best. More at beforeitsnews.com.

]]> http://www.mybudget360.com/if-incomes-are-down-where-is-the-economic-spending-coming-from-industrial-production-still-lower-credit-contraction-and-average-work-week-at-record-low-wells-fargo-considering-converting-option/comment-page-1/#comment-15626 edward Fri, 06 Nov 2009 20:16:01 +0000 http://www.mybudget360.com/?p=1390#comment-15626 Thanks for the great charts. I especially like the dollar chart. I have no idea how long the fed is going to be able to keep this game going. My money is on a higher gold price by playing the miners through gdx and an intermediate term continuation in the bear market in equities (spxu). My fear is that I might be wrong and equities will continue to rally because of the easy money. Thanks for the great charts. I especially like the dollar chart. I have no idea how long the fed is going to be able to keep this game going. My money is on a higher gold price by playing the miners through gdx and an intermediate term continuation in the bear market in equities (spxu). My fear is that I might be wrong and equities will continue to rally because of the easy money.

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