Saturday, October 25, 2008

I'm Changing My Name to Chrysler:

Always a classic, and very pertinent now.

A little history, Chrysler got a 1.5 billion dollar loan from the Gub'ment (Mark Twain version sp?) to avoid bankruptcy. As of the bailout plan, GM, Ford, Chrysler got 25 billion dollars I believe in a similar deal. I know it sounds bad, but I have little hope for the US of A's car companies. Chrysler did pay back there old loan (early even), depending on long-term energy prices (demand and supply see-sawing against each other) and the affect of credit (betting on future growth). I'm thinking that won't quite be the case again.

Also, if you've enjoyed partial bank nationalization hold on to your hats because more fun is on the way - Option Arm recasts - remember not to confuse recasts and resets, I always do. Basically one comes before the other, and the second one is more important, because that is when you _have_ to pay more per month.

With 80% of these Option Arm people making the minimum payment, you can expect 80% to foreclose or short sell. Housing prices fall even further. But don't worry 60% of Option Arms are in California. There is no way we are out of this crisis.

The real economy will continue to decline, and we'll be in a recession -officially- because we are certainly in one now.

While the above is pretty incoherant (from cars to Option Arms) it displays my basic pessimism about the economy and public policy - if Option Arms can happen, there is no God.

But remember to always look on the Always Look on Bright Side of Life.


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