{"id":6858,"date":"2009-02-09T20:14:00","date_gmt":"2009-02-10T03:14:00","guid":{"rendered":"http:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/?p=6858"},"modified":"2009-02-09T20:11:50","modified_gmt":"2009-02-10T03:11:50","slug":"what-are-the-stimulus-plan-and-tarp-ii-going-to-mean-for-the-housing-and-mortgage-markets","status":"publish","type":"post","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/6858\/what-are-the-stimulus-plan-and-tarp-ii-going-to-mean-for-the-housing-and-mortgage-markets\/","title":{"rendered":"What are the Stimulus Plan and TARP II going to mean for the housing and mortgage markets?"},"content":{"rendered":"

While I could write for a LONG time about it, I’m going to limit it to what I feel are the top 6 things that I think could very well happen.   Keep in mind, this is being written after watching President Obama’s press conference but before anything gets passed.<\/p>\n

1. The market is expecting that both the Stimulus Plan and TARP II will provide “the answer” to the problems that are currently plaguing our economy.   With that being said, I believe the markets will be disappointed because the problems facing the economy are way more complex and urgent than what one or two bills can solve.   The disappointment will put downward pressure on stocks and upward pressure on rates.<\/p>\n

2. The $15,000 tax credit for home buyers will pass but rather than jumpstarting the housing market, it will instead cause a few people to buy homes, mainly first time home buyers, and will extend the inventory problems that we have because prices won’t adjust as they should.   We won’t get nearly the “bang” for the $Billions that will be spent on the tax credits.   I’m sorry but I really think the main beneficiaries of the $15K tax credit will be mortgage lenders, real estate people and the relatively few people who were already thinking of buying.   Will it reduce inventories?  No, other than taking some bank owned inventory (for first time buyers) off the banks, the rest of the people will be “shuffling” inventory because they all have a house to sell.<\/p>\n

3. Between the Stimulus Plan and the TARP II funds, we’ll (yes, it’s you and me) will be spending close to $1.2 Trillion.   Do we have the money?   No, we don’t, so we’re going to borrow it.   What will that mean to the market?   A couple of things are going to happen (obviously in my opinion):  1) The government is going to flood the market with debt in order to finance this spending.   That’s going to push the supply demand equilibruim off base and that is going to put upward pressure on mortgage rates.<\/p>\n

4. What about that 4.5% mortgage rate?  Is it Read more<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

While I could write for a LONG time about it, I’m going to limit it to what I feel are the top 6 things that I think could very well happen.   Keep in mind, this is being written after watching President Obama’s press conference but before anything gets passed. 1. The market is expecting that […]<\/p>\n","protected":false},"author":44,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_crdt_document":"","jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[26,5],"tags":[289,268],"class_list":{"0":"post-6858","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"hentry","6":"category-lending","7":"category-real-estate","8":"tag-stimulus-plan","9":"tag-tarp","11":"no-featured-image"},"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack-related-posts":[{"id":5244,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/5244\/arthur-laffer-the-age-of-prosperity-is-over\/","url_meta":{"origin":6858,"position":0},"title":"Arthur Laffer: “The Age of Prosperity Is Over”","author":"Greg Swann","date":"October 27, 2008","format":false,"excerpt":"The author of the Laffer Curve in the Wall Street Journal:When markets are free, asset values are supposed to go up and down, and competition opens up opportunities for profits and losses. Profits and stock appreciation are not rights, but rewards for insight mixed with a willingness to take risk.\u2026","rel":"","context":"In "Investment"","block_context":{"text":"Investment","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/investment\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":5557,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/5557\/paulson-translated\/","url_meta":{"origin":6858,"position":1},"title":"Paulson Translated","author":"Tom Vanderwell","date":"November 12, 2008","format":false,"excerpt":"After listening to and reading the text from Paulson\u2019s speech this morning, I had to sit down and translate it because there was so much he wasn\u2019t saying and so much that he was saying that was just not \u201cright.\u201d\u00a0\u00a0 I hope that you\u2019ll do two things: Take the time\u2026","rel":"","context":"In "Big Mother"","block_context":{"text":"Big Mother","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/big-mother\/"},"img":{"alt_text":"End of Story","src":"\/DOCUME%7E1\/TOMVAN%7E1\/LOCALS%7E1\/Temp\/msohtml1\/01\/clip_image001.gif","width":350,"height":200},"classes":[]},{"id":5554,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/5554\/nar-promotes-housing-stimulus-plan\/","url_meta":{"origin":6858,"position":2},"title":"NAR Promotes Housing Stimulus Plan","author":"Dave Phillips","date":"November 12, 2008","format":false,"excerpt":"Here is a fresh bone for Bloodhounds to chew on.\u00a0 This 4-point stimulus plan was approved by the NAR Board of Directors this past Monday and is being pushed heavily in Washington DC.\u00a0 The National Association of Realtors\u00ae will offer a four-point legislative plan to reinvigorate the housing market, calling\u2026","rel":"","context":"In "Big Mother"","block_context":{"text":"Big Mother","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/big-mother\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":6231,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/6231\/the-frog-and-scorpion-millenium-edition\/","url_meta":{"origin":6858,"position":3},"title":"The Frog and Scorpion (Millenium Edition)","author":"Brian Brady","date":"December 23, 2008","format":false,"excerpt":"Rod Blagojevich tried to sell the Illinois Senate seat, recently vacated by President-Elect Obama.\u00a0 Blago is to public service what Bernard Madoff is to investment advisory; a modern day pirate, raping and plundering.\u00a0 Their sociopathic behavior is exacerbated by their belief that position implies entitlement.\u00a0 If you're a believer, there\u2026","rel":"","context":"In "Real Estate"","block_context":{"text":"Real Estate","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/real-estate\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":2543,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/2543\/which-candidate-gets-subprime\/","url_meta":{"origin":6858,"position":4},"title":"Which Candidate “gets” Subprime?","author":"Jim Duncan","date":"January 28, 2008","format":false,"excerpt":"Stimulus programs.\u00a0 Health care.\u00a0 Subprime.\u00a0 Which candidate \"gets\" the subprime fix in which we find ourselves?60 Minutes did quite the story this evening on the subprime problem, summed up with this quote:If it sounds like a shell game or Ponzi scheme, it was in a way.Ron Paul says:\u201cIf you believe\u2026","rel":"","context":"In "Real Estate"","block_context":{"text":"Real Estate","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/real-estate\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":5990,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/5990\/the-tangled-web-of-tarp\/","url_meta":{"origin":6858,"position":5},"title":"The Tangled Web of TARP","author":"Brian Brady","date":"December 9, 2008","format":false,"excerpt":"It's deja vu, all over again. 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