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Dear Friends,

As of today, there are only thirty days remaining until the warm winds of Summer gradually dissipate towards the brisk and chilly seasonal change of Autumn. Labor Day is a little over two weeks away and many of us will enjoy our last vacation with family and friends before the beginning of responsibilities tied to our work place the following day. However for many, this has been a Summer of discontent as unemployment has reached frightening Depression era proportions.

The figures for individual states were released on Friday by the US Bureau Of Labor Statistics. The state of Michigan tops the list with 15% unemployment, while Rhode Island 12.7%, Nevada 12.5%, Oregon 11.9% and California at 11.9% respectively, are the top 5 of 15 total states with double digit percentages. While the unemployment rate for July is currently at 9.4% for the nation, there has been dramatic increases in many urban areas throughout the country. It was reported last week the rise in unemployment among white collar workers has exacerbated the American economy with an upsurge in foreclosures. While the original focus of the foreclosure problem originated with sub prime adjustable loan programs, the loss of employment has created a new element of worry that a 'recovery' from this Recession will continue to be slow and painful. The unemployment figures did mention that 17 states showed a decrease, 7 states remained the same and 26 increased from a month earlier. While there could be a glimmer of hope if you see the glass as half full, the realities of those without work are too stark to not notice.

'Leveling Out'

The Fed Chairman on Friday mentioned the US and the global economy 'appears to be leveling out' and the 'prospects for a return to growth in the near term appear good'. The stock market was reassured of an economy on the mend and began its upward climb to over 9500 on the Dow, once these words by Mr. Bernanke were heard throughout Wall Street. The Bulls last Friday were in demand and eager to demolish the china shop by its ebullience at any words of encouragement or by reading of any financial statistic, however circumspect, by maneuvering its interpretation.

Real Estate Sales

Other news to bolster the rise of optimism was due to the sale of homes in July. The National Association Of Realtors reported real estate sales of single family homes were up for the 4th consecutive month at 7.2%. These figures can be construed as partially encouraging as foreclosed homes, REO or real estate owned homes by major banks were lowered dramatically in price where the likelihood of 'dumping' such properties was not out of the question. In lowering the purchase prices to such a degree, investors see a chance of a lifetime! First time homebuyers can take advantage of the governments' $8000 tax credit. Overall, anyone purchasing an owner occupied home can apply with FHA financing and with at least 3.5% in savings for a downpayment, many would jump at the chance to purchase a home. While this activity is an event in itself, many of these home sales were due to the misfortunes of others. The loss of a family home through foreclosure has brought an influx in new buyers to the market. While it's true we have a free market system and the financial ups and downs of our citizens is truly troublesome, the sale of foreclosed homes to first time home buyers or private investors particularly, is ethical food for thought.

Caution In The Wind

Notwithstanding, I must add a word of caution as we've been through this experience before and the likelihood of a bear market still looms just around the corner. The precipice of Trillion dollar deficits, continued double digit unemployment and a devalued US Dollar are all factors waiting for its time on center stage in the coming months.

The financial meltdown has affected all Americans by its insipid abilities to destroy one's peace of mind and has compelled an introspection in the manner of comportment we have for ourselves, our friends and loved ones. The stress brought about by this entire maelstrom of depressed economics by losing property, employment, upheaval of marriages and friendships is a wake up call that foretells the future of this country.

There is a mature element tied to America's economic challenges which has reminded many of us to become more aggressive in our financial dealings by approaching such matters in a logical, methodical and 'hands on' manner. We have become weary of financial advice from consultants unable to communicate intelligently the advantages or disadvantages of investments offered, the inability to provide worthy references or testimonials of previous clients or the sense of manipulation a client feels when undue pressure to 'sign on the dotted line' is due to the motivation for the official 'charm offensive' which is always a detriment towards the finances of the consumer.

We also seek guidance and support from those members in our family and good friends that open their hearts, their homes and their wallets by alleviating the effects of economic consequences when a paycheck or monies to pay necessities are not forthcoming. When there is no ability to keep a roof over one's head, keeping food on the table or paying for prescription medicine where does one go for comfort? These are questions being asked daily by millions of Americans decimated by the after effects of a financial system brought to its knees by greed, corruption and incompetence by the same forces orchestrating the 'mindless recovery' where graphs and statistics have more credence than the challenges of those homeless and unemployed. This Recession has torn apart families and marriages as the chronic financial stress and the daily struggle to keep a family together, has accumulated the grounds for partners to separate or file for divorce.

Personal Effects

As the owner of MoneyTeam for the past 20 years, I've seen first hand the effects a downturn in the economy can have on the  personal fortunes of those seeking guidance to minimize its damage. There are those that have the ability and the faith to whether the storm and show resilience throughout the period in question. Unfortunately, for many others, this Recession has contributed to the destruction of one's financial net worth to such a degree it may take years to recover. Moreover, the toll on personal relationships with others has contributed to a sense of foreboding and melancholy.

I was deeply saddened to know that one of my clients filed for divorce from a marriage of over 20 years due to the stresses of imminent foreclosure brought about by the loss of employment. While this situation is a source of grief for both partners, the realization there are similar outcomes just ahead for other marriages, holds no comfort. A 'recovery' in graphic financial terms does not provide the true picture of Americans suffering from these economic challenges.

'Be Of Good Cheer'

While this Recession will eventually come to an end, the damage in its wake has been life altering for many. In Scripture we become aware there will always be trials and tribulations throughout our lives. Jesus mentions on several occasions and under the most trying of circumstances for us 'to be of good cheer'. While we do not have the ability to predict our futures, we all know in our hearts this period of economic uncertainty will one day come to pass. There will be lessons learned of course and as a Christian nation, wisdom will be afforded to those that have sacrificed, so that others could begin to live again. 

The Summer Wind

You might want to view the TeamBlog written on June 20th, 2008. In that entry, I discuss Frank Sinatra and my fondness for the simple lyrics and his great voice singing the treasures which Summer always brings. We encourage you to check Frank's performance on YouTube:

http://www.youtube.com/watch?v=mhhXEuxhpG4

Thanks Again