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Snow White and the 7 Dwarfs Economic Update
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The American economy is a happy place. The stock market is above 10,000. Corporate profits have improved. Productivity in the work place has surged. The Commerce Department reported the gross domestic product, the measure of goods and products, is now matching average growth over the past 80 years. In our very own fairy tale, birds are singing and the small furry animals are frolicking in the desert. We are back to shopping at Neiman's (good bye Wal-Mart) and our just purchased BMW convertible is sitting in the driveway of our new cottage. Bank draft fees are non-existent. Interest rates on credit cards are zero percent. Shiny bottles of good wines are stacked in our sub zero refrigerator and we are back traveling to the places we love, like Vegas, baby. So why are the seven dwarfs of the economy haunting our perfect dream?
Dopey, aka Fannie Mae is now going to become a landlord. Dopey/FM refused to modify our loans or approve short sales. In lieu of foreclosure they are going to allow us to turn over our deeds to the evil lender and we can lease back our homes at the current market rate. The same day they announced this they also hit up Uncle Sam for a few more billion of bail out money. Is that a tear in your eye?
Grumpy, also known as the employment numbers is not playing nice with the rest of the economy. The unemployment numbers are the highest reported in 26 years. You gotta ask boys and girls, is this the time to stage a walkout at Fry's and Safeway with so many people looking for a job?
Doc, the 8,000 tax credit along other with stimulus programs, will hopefully (remember hope is not a strategy) fix our housing market and the rest of the economy before April 30th.
Happy, are the banks with all of their pixie dust profits.
Bashful are the retail numbers. A modest gain in October rallied the markets. The stores are wishing on the holiday star that sales are strong for the holiday season.
Sneezy, if China sneezes the entire world reacts. Let's just hope their economy does not catch the flu.
Sleepy, is our government. Still not awake enough to take on the big banks to resurrect our housing market and to just say no: to credit derivatives.
Our kingdom is resilient and no doubt we will have a happy ending. But first the knight in shining armor will need to banish the evil step mother called Recession to a land far, far, away.
