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May 31st, 2009 11:50 PM


Dear Friends,

As told in Scripture, we are made aware of a beaming, bright flash of light from Heaven which struck Paul on the road to Damascus. The light temporarily blinded Paul for up to 3 days. The Lord insisted that Paul continue his journey where he would meet several Christian followers. Paul obeyed and in a short span of time he understood the workings of the Lord. Paul was enlightened and grasped the wisdom and knowledge of eternal life. From this conversion, Paul ceases to end his bitter hatred of Christians and begins an 'Epiphany' wherein he appreciates the suffering and sacrifice of the Lord and begins to embrace a direction where a life of substance, character and forgiveness is the path to spiritual freedom.

I mention the 'Damascus Conversion' as highlighting the pain and suffering many Americans continue to experience with no end in sight. In times of dramatic upheaval as we are witnessing, many of us seek guidance not from our family, friends, coworkers or government but from the Almighty Himself.

For many Americans, everything is upside down financially. We hear of better days ahead from persons unaffected by the Recession. Politicians, Government Bureaucrats, Millionaires, Wall Street Executives, Hollywood Celebrities and the Main Street Media are all excited to impress others by their willingness to advise Americans there is a 'light at the end of the tunnel' or there are sightings of 'green shoots' where economic suffering will end by the 4th Quarter of this year. However, I must caution if the economy continues its peripatetic displays of withdrawal from the free enterprise system, the consequences of socialism will be the direct result. The bankruptcy of General Motors where over 60% of its ownership will be controlled by the Federal Government is a case in point.

The chronic pursuit of intervention in all matters is the current mindset of government bureaucrats. The private sector one reasons, is incapable of delivering goods to the public at large in an efficient manner or unable to sustain a profit. Without profits, the ability of government to garner income by its enforcement of taxes is in question. The incessant control of redistributing wealth, is the ultimate goal of the newest paradigm waiting for its debut, similar in concept to the novels written by such authors as Aldous Huxley in a 'Brave New World' and George Orwell's '1984'.   

As the owner of a mortgage company, I've been privy to speak with many of our former and newest clients in regards to the financial meltdown which continues unabated to this day. The concern of many is the possibility of losing one's job, the ability of securing financing under today's strict underwriting guidelines and the likelihood of continued lower interest rates. Moreover, the decline in the value of real estate and the escalation of foreclosures has many Americans anxious about their investments.

All told, we are weary of daily earthquakes in the financial markets. The loss of the auto industry, the addition of countless Americans on unemployment lines and the loss of one's home has depressed the natural optimism once displayed in times past.

America is at a crossroads. Ever since we were 'duped' by the previous Administraton with the approval of Congress last year on the necessity of a $700 Billion Stimulus to save our economy from the brink of Depression, we have unwittingly given power to those same elements in Congress and the current Administration to continue the spending spree by their request of additional bailout monies in the Trillions for Wall Street interests and the newest US Budget. The financial health of this country has markedly become worse.

I and many Americans no longer believe the talking heads on television whether they be economists or politicians extolling facts and figures which are made up in thin air. As mentioned earlier, we are also weary of the deluge of media concerns heralding the end of the 'Recession' by years end and the government prognosticators proverbial function to raise false optimism by engineering its message in such a manner to defy incredulity.

In any financial dealing, caution is recommended. Always be frugal in your approach to money. The future looks murky at best. I hope I'm wrong but I see the following economic situations which will attack the fortunes of all Americans.

1. Additional tidal wave of FORECLOSURES. Adjustable loans and ALT-A 'Stated Income' loans are now coming to maturity during the next 18 months. You will also see COMMERCIAL properties becoming affected.

2. There will be attempts by Congress and the Administration to propose additional TAXES to pay for the Trillion dollars in spending. Your State or Municipality might have the same idea to garner additional revenues.

3. Due to the Trillion Dollar spending spree, there will be INFLATION. When the Treasury continues to produce paper money to pay for money we do not have, this is the beginning of prices of all goods inching upward. 

4. When INFLATION hits, you will also see the rise in short term INTEREST RATES. Just last week, mortgage rates skyrocketed to over a 1/2 a point. MoneyTeam was offering 4.5% at 1 point for a 30 Year Fixed loan on Monday. By Thursday, the rate went up to 4.875%. You must understand the workings of the BOND MARKET. Always check the 10 Year Treasury. When there are INFLATION jitters or if there is a sense the economy is improving, short term interest rates are unfavorable.

5. When INTEREST RATES rise, many buyers will be unable to purchase property or refinance due to the inability to qualify for a MORTGAGE. With new stringent underwriting guidelines, the requirements for a PRE-APPROVAL are at risk.

6. The value of the US DOLLAR will continue losing value against the Euro, Yen and other foreign currencies. The World will no longer have faith in the Dollar due to the direct results of the US economy. When this happens, you will notice foreigners eager to buy American real estate at depressed fire sale prices. This activity in itself is dangerous as foreign interests are usurping the sovereignty of Americans by elevating its percentage of ownership. Having foreign concerns gobble up the country gives too much power and voice to their interests.

7. UNEMPLOYMENT will continue to rise to double digits. When there are no jobs to be found, the spiraling effects of an economy in a freefall is obvious. Without money coming in, mortgages are unable to be paid. Many Americans are facing this reality today where money for food, medicine or basic needs to live are no longer being met.

This is just a short list of additional consequences America will endure in the months to come. We all need to take a deep breath and logically question the information we are provided by economists, politicians and the media in general in regards to the health of the economy.

When I spoke about Paul and the 'Damascus Conversion', he became aware of his shortsightedness. I for one have become skeptical of statistics, figures and all statements provided by the news media and bureaucrats in regards to the economy. I considered myself too trusting or naive when Congress or advisers in the White House address issues where an altruistic approach and a truthful response to queries from the American public is expected. It is sad to say once again, that I was wrong to think politicians are devoted to public service.

All Americans have a duty to read between the lines, ask questions and devote their time in seeking the truth. Now more than ever, the future of this country is in our hands. Men of character in the political realm are still around. It's our job to find them and show them the way out of this financial mess before we lose everything. 

Thanks Again     




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Posted by Jesse Dorado on May 31st, 2009 11:50 PMPost a Comment

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