Ben goes for Mortgages finally!

Ben, Finally we are seeing you go for Mortgages. You should buy outright mortgages from the banks
in a move aimed at removing a set of homes off the market for a few years while the housing market
gets back on its feet. And work with Freddie and Fannie to shore up the homeowners. While you
misgauged the effects of policy and what was to come along with Bazooka Hank, it is important to
support home-ownership as it is the single largest asset for those who have a Household net worth of
under 250,000. This is not a Fed goal, but it should be.
Cheap capital can create jobs. What has happened in the 2008-2010 crisis is that money moved away
from the small towns into Wall Street. As values plummeted the small towns became poorer and their
ability to sustain people and build communities declined. The displacement was coupled with a jobs
displacement away from small towns as well. Credit has not returned to smaller towns as muni budgets
and state and local govts have shrunk. Expenditures by the Federal Govt. and the Fed, should target these depressed communities. When Amartya Sen looked at scarcity, he explained how there were sections of the
populace that were left out. The state he felt had to step in and create work there. The same is true about
the Fed today. Aggressively buy Mortgages in affected communities to help shore up real estate. Work with
local banks in building a base for credit reconstruction and rebuilding of these local communities.
This is the private sector answer. It has never been the case that the Fed has worked with states. But this is
perhaps the time to do so. Build a policy schedule that is aimed at reinjecting capital and credit into
smaller towns and rural communities, so that a rejuvenation is possible. 

Yo Dirty Harry, Bazooka Hank and Helicopter Ben Did'nt Fix No Nothing

Yo Sheriff, if you rode out of town out East, into nearby Stockton,


you will see how depressed the Real Estate market is. House Prices

are in some places down 50% or more - towns where

whole neighborhoods are under water are a common sight. In the years

after 9/11 the Bush/Greenspan

Economy grew and kept expanding on the strength of the housing boom -

Capital Consumption Adjustment and other related items were 70% of

GDP growth. As supply grew well beyond the demand,

the economy had grown by borrowing from the future. Throw in a big

spending warrior who is interested in going where his pappy has not

gone before and you have the legacy for the first black president of the

United States. As inflation soared Bernanke ratcheted up rates,

popping the bubble that left a deep  recession. This was the legacy,

Obama inherited - a War nobody wanted to fight, homes nobody wanted

to buy, deficits nobody wanted to pay for and a dying manufacturing

base nobody wanted to help - this was Nobody's Ketchup on a Hot Dog

- it was everybody's blood and sweat, well at least everybody who is

Nobody. GM was bankrupt and needed a bailout. The drop in the GDP was

8% in the final quarter of 2008 and first quarter of 2009. Bazooka

Hank was not around when Right after Obama took office, the Dow fell

precipitously to 6600 and a new Great Depression was coming. A series

of measures restored confidence

in the economy, none more so than the GM bailout. Yet, the housing

recession is not over. The rest of the economy

is recovering, but jobs are not growing despite all the easy money,

outside what the Federal Govt. is creating.

States and local govt. are shrinking their budgets as revenue has been

cut. Median Household net worth in the US

has dropped 35% in 5 years, a statistic that belies the haemorrhaging in housing,

the undercurrent of despair that drives unemployment and underemployment

across the country. After three years of tax cuts and record deficit spending,

the economy is starting to respond. And that is because Bazooka Hank

and Helicopter Ben had not left us Across the Globe, the World Economy

is fast declining. The UK under a conservative PM has been in

recession and is running record deficits. Parts of the EU are falling

apart at the seams as the Sovereign Debt crisis leaves it teetering on

the brink of a collapse. Even China and India have dramatically slowed down.

Compared to this, the US is still growing.



But it is the Obama foreign policy that is their biggest success. We

are out of Iraq. And there is respect from around the globe for

the American way. People respect this President abroad and want

America to lead a peaceful world. You should listen to Ron Paul

who tells us that Syria and Iran are on the cross hairs of the Romney

administration. A nation's got to know its limitations. And the Obama

adminstration understands the value of fair dealing and friendship

and there is greater willingness to follow its principled positions.



Dont sign off on Romney till they tell you that they will not be

fighting any new preemptive wars and will not blow such a big

hole in the deficit that nobody can fix it. Get them to provide policy

on the poor and guarrantees for those on the edge.Till you get

assurances on the actual numbers, listen Clint. Don't Go Ahead and

Make Their Day.