Thursday, April 2, 2009

Subsidize mortgages with taxdollars?

WASHINGTON (AP) "The Obama administration soon may be forced to subsidize the government's mortgage insurance program with taxpayer dollars as economic troubles cause defaults and foreclosures to surge."

Or maybe deflation is just what the doctor ordered? A weak dollar combined with weak demand? This is going to be interesting. We could end up having high prices when there's no demand to justify such price levels.

Sooner or later, however, prices must come down. Only after prices become more aligned with wages will there be a "recovery." Like I said, I don't believe we're in a recession. This is a long-term standard of living adjustment.

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