Chicken or the Egg Is it SAVE jobs or CREATE jobs
Chicken or the Egg Is it SAVE jobs or CREATE jobs
Hopefully some of the new initiatives that are being set in place will assist the American family’s homeownership problems. At lunch today, I was talking with someone who is no different than any of us, in that, his family is way upside down in their home. They owe about $220,000, they paid $260,000 and the house appreciated to about $280,000 but is now worth, on a good day, about $175,000.
I told him some great news, “Since you are paying your mortgage on time, you don’t qualify for the HOPE Now program, but you will qualify for the new $1,000 credit per year (max three years) for paying your mortgage on time.”
Okay, let’s work this one out. Let’s say I pay $2,000 a month on the example above on a six percent mortgage. I get a $1,000 tax credit per year for three years. Let’s focus on this year. That means, in reality, I would only pay about $1910.00 per month. Sounds like a great plan, I save a little money each month and I have no chance to refinance my home ever because I am so upside down, due to no fault of my own. And maybe 15 years from now the home values in my neighborhood will finally come back.
Now as I discussed in my previous writings, if I quit paying my mortgage for 60 days my bank will start working with me. On this example, they will cut my mortgage to $160,000, give me a mortgage at four percent for 30 years and my payment goes to $1200.00 per month. So I can save almost $10,000 per year every year, not counting the astronomical amount of interest I save each year. Or I can keep paying and be 100k upside down and qualify for $1,000 per year for three years credit. WHAT!! Are you kidding me?! Who thought up this plan? In comparison, let’s examine a project that IS included in the stimulus package.
Congress included $38 million for wetlands restoration that the Obama administration intends to spend in the San Francisco Bay area to protect, among other things, the endangered salt marsh harvest mouse!
Now, I am not pointing fingers at any one person but House Speaker Nancy Pelosi and her $30 million mice may not be a smart investment for our country. Let’s see - save a mouse that has probably been around for a few thousand years or save a few hundred home owners, teachers, or jobs. I just don’t get it. Now don’t start calling me - I am “green,” but I’m not detached from reality.
Saving jobs is a priority but at what expense? I say let the auto industry file bankruptcy. If the government is so worried about the jobs, then they can guarantee the reorganization, but you have to solve the problem. The union mentality doesn’t work today and needs to change. I found it very funny when the CEO of General Motors was thanking the union presidents for their support in drafting their new solvency plan to Congress. Why not thank the union for helping the company go down the drain? Hey, here is some good news, we won’t have to change the logo for G-M; we can just change the name to Government Motors (GM).
Bottom line; fix the housing problem, get the money to the bottom and eliminate the trickle down affect. Until then, little – if anything – changes.
Happy Investing!
James Dicks
Chicken or the Egg Is it SAVE jobs or CREATE jobs - To learn more about this author, visit James Dicks's Website.
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All of sudden, everything I read in this new economic stimulus plan is about helping to create or SAVE 3.5 million jobs, when, in fact, this new federal stimulus plan was supposed to actually CREATE up to 4 million jobs. This is a wakeup call and it is time for you, the American public, to get informed, stand up and speak your mind. Use the Internet to send emails to your senators and congressman. With today’s speed of transparency, there is no reason that we, the American people, can’t find out exactly what is going on in our government in a moment’s notice.
Hopefully some of the new initiatives that are being set in place will assist the American family’s homeownership problems. At lunch today, I was talking with someone who is no different than any of us, in that, his family is way upside down in their home. They owe about $220,000, they paid $260,000 and the house appreciated to about $280,000 but is now worth, on a good day, about $175,000.
I told him some great news, “Since you are paying your mortgage on time, you don’t qualify for the HOPE Now program, but you will qualify for the new $1,000 credit per year (max three years) for paying your mortgage on time.”
Okay, let’s work this one out. Let’s say I pay $2,000 a month on the example above on a six percent mortgage. I get a $1,000 tax credit per year for three years. Let’s focus on this year. That means, in reality, I would only pay about $1910.00 per month. Sounds like a great plan, I save a little money each month and I have no chance to refinance my home ever because I am so upside down, due to no fault of my own. And maybe 15 years from now the home values in my neighborhood will finally come back.
Now as I discussed in my previous writings, if I quit paying my mortgage for 60 days my bank will start working with me. On this example, they will cut my mortgage to $160,000, give me a mortgage at four percent for 30 years and my payment goes to $1200.00 per month. So I can save almost $10,000 per year every year, not counting the astronomical amount of interest I save each year. Or I can keep paying and be 100k upside down and qualify for $1,000 per year for three years credit. WHAT!! Are you kidding me?! Who thought up this plan? In comparison, let’s examine a project that IS included in the stimulus package.
Congress included $38 million for wetlands restoration that the Obama administration intends to spend in the San Francisco Bay area to protect, among other things, the endangered salt marsh harvest mouse!
Now, I am not pointing fingers at any one person but House Speaker Nancy Pelosi and her $30 million mice may not be a smart investment for our country. Let’s see - save a mouse that has probably been around for a few thousand years or save a few hundred home owners, teachers, or jobs. I just don’t get it. Now don’t start calling me - I am “green,” but I’m not detached from reality.
Saving jobs is a priority but at what expense? I say let the auto industry file bankruptcy. If the government is so worried about the jobs, then they can guarantee the reorganization, but you have to solve the problem. The union mentality doesn’t work today and needs to change. I found it very funny when the CEO of General Motors was thanking the union presidents for their support in drafting their new solvency plan to Congress. Why not thank the union for helping the company go down the drain? Hey, here is some good news, we won’t have to change the logo for G-M; we can just change the name to Government Motors (GM).
Bottom line; fix the housing problem, get the money to the bottom and eliminate the trickle down affect. Until then, little – if anything – changes.
Happy Investing!
James Dicks
Chicken or the Egg Is it SAVE jobs or CREATE jobs - To learn more about this author, visit James Dicks's Website.
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