HUD program turns out to benefit contractors and not the poor…go figure! China cranks up its printing presses-expect global inflation, Peter Schiff (“Dr. Doom”) discusses his book “Crash Proof”, Goldman Sachs plans to sell billions in stock to pay off government aid ASAP, gas prices up 5% in 3 weeks…inflation? Top U.S. general says we’ll be out of Iraq by 2011, and 75% of Americans want to lift Cuba embargo…
HUD Program Benefits Contractors, Not Poor. A federal program designed to help poor families buy affordable homes has actually been lining the pockets of investors and contractors.
China Cranks Up Printing Presses: Inflationary Pressures Mount. The People’s Bank of China said it will ensure sufficient liquidity to sustain economic growth, following news that new loans jumped sixfold to a record in March. It pledged “ample liquidity” to “ensure money supply and loan growth meet economic development needs.” In other words, China intends to follow the U.S. path to printing its way out of recession. This will significantly enhance global inflationary pressures.
Real estate is a great way to hedge inflation. Owning investment property gives two big advantages: (1) Rental rates increase with inflation, and (2) fixed rate mortgages lock in low rates now before inflation takes hold. Consider this Apartment Building Cash Flow System in helping you get started.
Worried about inflation? Does the Federal Reserves scare rather than comfort you? Peter Schiff was one of the few who predicted the financial crash last year. He predicted the housing crash of 2007. And now he predicts a Treasury and U.S. dollar collapse as our government tries to borrow, inflate, and spend its way out of our current problems.
For practical ways to shield your portfolio from the coming storm, check out Crash Proof, in which he explains America’s problems and points to how you can protect yourself.
Goldman Sachs Selling Shares To Pay Off Government. Goldman Sachs will sell $10 billion in common stock to repay U.S. Treasury aid received throughout the financial crisis. A 47% gain in the company’s stock price this year and a return to profitability in the first quarter may help the company meet its funding target. Goldman is one of a growing list of banks and financial institutions rushing to repay federal aid amidst growing government involvement in regular business operations.
Gas Prices Up 5% In 3 Weeks. Gasoline prices have surged 5% in the last 3 weeks, rising 9.6 cents to $2.05 per gallon at the pump. Tillby Lundberg, who published the report, says this is likely due to ‘seasonal demand’ in which prices typically rise during spring and summer months. With $13 trillion in new money printed by the Federal Reserve in the last 16 months, this could be a more ominous sign of encroaching inflation. Watch energy and food prices in the coming months for further indication.
Top U.S. General Says We’ll Be Out of Iraq By Late 2011. General Ray Odierno, the top U.S. military commander on the ground in Iraq, said that he believes U.S. troops will be out of the country by the end of 2011.
Seventy-Five Percent of Americans Want To Lift Cuba Embargo. A new pol shows that 75% of Americans think the U.S. should lift its travel ban and trade embargo with Cuba. The Obama administration is taking steps to relax relations with the island nation, signing new rules on travel for family members and money remittances.
Everyday the news points in a single direction: the growing size of government and its role in the economy. With every new bailout, every new trillion dollar printing press party by the Federal Reserve, and every new regulatory edict by the President or Congress, our society moves closer to a political economy. Free trade, free enterprise, Capitalism…these are words of a forgotten age. Regardless of your political persuasions, we must all face the reality that confronts us. Now is the time to learn how policy drives markets, so that you can protect your portfolio, insulate it from the whims of the Bureaucratic Machine, and maybe even make a profit along the way. To learn how the New Order will affect your portfolio and how you can protect yourself, read Obamanomics: A Guide to Investing Over the Next Administration.
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Well, there is a case for inflation if we look into things like FED monetizing debt, China pumping up liquidity etc etc, but I seriously doubt that we may witness DEFLATION in all asset classes first then any real monetary and consumer price inflation.
This way, I think buying real estate now is not going to be good bet. Holding cash or Gold (not as commodity but as currency) is better idea for now.
@Harry – Great point on the deflation scare. It’s ridiculous to think we will experience deflation in ALL asset classes. We’ve seen $13 trillion added to the financial system in the last 16 months with trillions more in deficit spending on the horizon. Icing on the cake will be pseudo nationalization of banking, with its requisite politicization of lending.
I mention real estate as a decent bet now due to legislative and tax incentives, and long time horizon for investment. Timing inflation is tough and real estate acquisitions typically have long lead times, so thinking about buying now could be a good idea.
Goldman Sachs told the Fed to raise interest rates today. Inflation-Market, Interest-Market, Required Reserves ?Increase, Regulate and Control: the reserve is the only true way of controlling asset bubbles. The control of the asset bubble is the best way of keeping unemployment benefits to a minimum.