Let's Just Give Them Some More Money.....Again

Senator Dodd said this week that Congress needs to provide aid for about 2.2 million sub-prime borrowers. So, let me get this straight. Senator Dodd wants to use our tax money to bail out someone who took out a mortgage that they couldn't afford, enable them to live in a house that they shouldn't be in, to help those who were casulties of a horrible mortgage system that Congress has enabled, and to help those who don't read the fine print.You know let's not give them aid.

Let's just pay off their mortgage. In fact, let's help out those poor sub-prime lenders because they might be in jeopardy of loosing the billions of dollars that they made while practicing predatory lending.

The problem starts at the top. We don't have leaders in Congress that work to protect the people of this country. We have politicians who close their eyes when it is convenient and point fingers when situations come unglued. It was convenient for politicians to close their eyes to a mortgage industry that through predatory lending was helping to pump a great deal of money into the economy and increase economic growth.

When did it make sense to throw credit underwriting standards out the window and issue mortgages without even verifying income or looking at tax returns. Senator Dodd, where were you 3 years ago. Could you not see this coming?

I really do regret that millions of sub-prime borrowers are going to be hurt in this mess. My heart goes out to anyone in this situation. At the same time, Congress is suppose to enable laws that protect consumers from their greatest enemy....themselves.

This is why gambling is not legal in every state. This is why pot is not legal. This is why there are speed limits.What we need is reform on all levels. The debt industry is out of control. Until we get politicians that think like leaders and not like politicians, these problems will continue to surface. Maybe I am being a little ldealistic. It just seems that most of these problems are real easy to fix.

Jim Cramer Doesn't Have a Bearish Bone in his Body

Dear Bob:

Just wanted to say thank you for your sanity. I was listening to Cramer on MSNBC (not sure why)and he is calling everyone suckers who are bailing or getting out of stock and of course his advice is to buy now. Might be good advice for some or really bad for others depending on where you are. Just made me want to look to see what you had to say and sure enough, you had a response. Always the voice of reason.

I always appreciate the kind words. Sanity is a strong word. My wife might disagree with the sanity remark.

The only thing that I am doing is looking at market risk. You can have high levels of risk in the stock market for a long time and nothing bad happens. However, high levels of risk always have a reckoning day. Until then, it only matters when it matters.

Are we starting to see risk matter? It is a little to early to say. As I have said many times, one week of stock market declines does not make for a bear market. On the other hand, it is prudent to know your risk level and be realistic about what stock market investors will face at some point.

When listening to people like Jim Cramer, always remember one thing. It is all about the ratings and being bearish is a ratings killer! Plus Cramer works for a company that is owned by GE (a publically traded company)

Although Cramer with all of his screaming and drama can be bearish on a particular stock, I guarantee you that you will never hear him be negative about the stock market in general or the stock of General Electric. At the end of the day, he has to be a yes man and do everything that supports the parent company that hosts his show!