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I came across a great piece in the Wall Street Journal by James Grant that provides a lot of great information about US currency, the dollar. It is very relevant to discussions about giving Fed Chairman Bernanke another 4 years  as well as the true value of a dollar.

Jim also discusses the history of our currency and what it means to us today. The US dollar is an IOU from the Federal Government. How much does that really mean anymore?

Source: Requiem for the Dollar (online.wsj.com)

Related articles

• Dollar weakens broadly (money.cnn.com)
• The Dollar’s Value Against Foreign Currencies Declines (time.com)
• Is the Dollar Dying a Slow Death? (time.com)

Understand, this is not that squishy feeelings sort of self-improvement. Jim was about changing your view and changing your life. Unlike most of the “self-improvement” folks today who spend their time on how you feel, Jim was all about doing it.

Have a quick watch of this video. It is only 7 minutes and I guarantee you will be glad you did…

It seems that Bernanke and the group of central bankers are pushing back very hard against the idea of auditing the Federal Reserve. Ron Paul started this proposal some time ago in an effort to better understand what was going on and where the money was going . Whenever Federal Reserve Chairman Bernanke is asked about the money and who he is giving money to and why his response has been No. He flat out told congress that he will not tell them who he is giving money to or why. I don’t know about you, but it does make you say hmmmm….

I know the argument about Fed independence. Bernanke throws it around like a sword. Last I checked, an audit doesn’t have anything to do with independence but provides visibility into the happenings of a major influence on our economy.

Last I checked, Bernanke works for us – the American People. The money he is handing out is ours. Congress, and in turn the people, have every right to know what is going on. It seems pretty arrogant to flat tell Congress, no, I am not going to tell you. It seems to me that Chairman Bernanke really, really doesn’t want us to know what he is doing. I don’t know about you but his behaviour screams out to me that the Fed must be audited ASAP.

Source: Audit the Fed: Bernanke and the Bankers Are Running Scared (prisonplanet.com)

Related articles

• Congress is losing its patience with the Fed (msnbc.msn.com)
• Bernanke rage boils over (money.cnn.com)
• Ron Paul Q&A: Audit the Fed, Then End It (blogs.wsj.com)
• Greenspan, Volcker Opposed Ron Paul Audit Provision (blogs.wsj.com)

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The homebuyer tax credit was just extended. You know, the $8000 tax credit given to first time buyers to help them get into a home? Well, with the extension came looser guidelines. It raises the maximum income to $225,000 and applies to people who have owned a home for at least 5 years as well as first-time homebuyers.

However you feel about tax credit from a fiscal standpoint or a policy standpoint, the fact is that homebuyers can get into an FHA insured home with no money out of pocket. The FHA offers a 3.5% down program, for a modest home purchase, would be more than covered by the tax credit.

That sounds nice until you look at the fact that homebuyers with no money out of pocket are far more likely to default than are homebuyers with skin in the game. It is common sense and the numbers support it. Should I also mention, again, that the FHA is already buried and there are a lot of people concerned for the agency’s future.

I could also bring up the fraud in the program and the new expanded guidelines are not likely to improve that situation. Between the raging failure called Cash for Clunkers and now this you have to ask yourself, what are these people thinking…

Source: Homebuyer Tax Credits Threaten the FHA (online.wsj.com)

Related articles

• First-time homebuyers tax credit: Should Congress end it or extend it? (dailyfinance.com)
• Senate OKs home buyer credit extension (dontmesswithtaxes.typepad.com)
• You Don’t Have To Be A First Time Homeowner To Receive The Tax Credit (zillow.com)

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Mortgage disclosure rules are changing. The old rules were that you didn’t really know the fees until you got to the closing table. You got an estimate but things could be added and adjusted at the last minute. In some cases you really don’t know until the last minute and this variability is legitimate. Of course brokers and lenders took advantage of this and added extra fees at the last minute that most people had no choice but to go along with.

Then the rules were changed to say that a borrower had to be disclosed with good numbers at least 3 days before the closing. Now we are getting somewhere. The idea is to give the borrower a chance to review the numbers with enough time to back out without the pressure of closing weighing into their decision.

Now they are turning all of this on it’s head. The new rules say that a broker or a lender has only one opportunity to disclose the loan. The fees cannot change from the first disclosure. The governement strikes again.

There are a tremendous number of very valid reasons that the fees and costs of the loan can change during the process. In my opinion, this rule makes no sense. I guess you could call it “too much of a good thing”. Everyone needs proper checks and balances to prevent the occasional temptation to cut a corner here or there but this is crazy.

My thinking is the the consumer simply needs more education on the mortgage process. If you understand what is going on and what the factors are you are able to make good decisions. The process becomes a partnership between the originator and the borrower. If the ignorance mistakes were removed from the the mortgage origination process, most of the unpleasantness that we have seen in previous years could have been avoided.

Related articles

• Report: 1 in 3 Loan Applications Denied (abcnews.go.com)
• Will ‘good faith’ be bad for borrowers? (huntingtonhomes.freedomblogging.com)

Related article

• SNL Rips Obama (kylesmithonline.com)

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We have been talking about the issues with the FHA. Here is a good article from the Boston Herald that goes through all the details. Quite frankly, something had to give. The FHA was in 3% of the market just a few short years ago and now they are up to 30%. The number of dollars involved is staggering. Their balance sheet is also coming in way below the congressional mandates. It is looking like they will attempt to get things shored up but increasing their fees.

It sounds good but I don’t think they are even going to come close with all of this. If I were a betting man I would put my money on the fees going up and then they will reach out to Uncle Sam (the taxpayers) for an infusion of cash. You heard it here folks.

Source: FHA may hike fees on home loans

Related articles

• Will the Housing Agency Need a Bailout? (time.com)
• All The Action Just Went To The FHA (eschatonblog.com)
• Housing agency’s financial cushion sinks (seattletimes.nwsource.com)

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“The Obama Bow” made a lot of news lately. The responses seem to range from “no big deal” to “I can’t believe he did that”. I am on the “can’t believe he did that” side and it made the hair on the back of my neck stand up. How about some common sense here. Who on God’s green earth doesn’t know that bowing in a situation like that is an acknowledgment of submission. It is no different than an dog rolling over on his back to another dog. I saw that and immediately thought that Obama just rolled over on his back. Does this man represent YOUR America?

I came across a terrific post by Bob Bauman regarding the history of the kowtow. It appears that the first westerner to refuse to kowtow was John Elliot Ward when visiting the Chinese emperor in 1859. No western leader has bowed since – well, until Obama. The article is a great read and pretty short. It is nice to have the history.

Source: Obama in Wonderland: Hu’s On First (baumanblog.sovereignsociety.com)

Related articles

• Obama’s getting flak for bowing in Japan. Early Americans bowed all the time. (slate.com)
• Obama is bowing again. (althouse.blogspot.com)

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I am dumbfounded with what is going on with the entire health care reform. I can’t even believe the brain surgeons in the hallowed halls of congress and the white house could even say with a straight face that this monstrosity is going to accomplish anything positive. Then they have the nerve to tell us that it is not going to send the debt in the stratosphere. Frankly, it is insulting that these fools think that we are so stupid.

The bills are thousands of pages, rolled out from a secret room where no one can see, rushed through and the vote is set for Saturday night – again. What happened to transparency? C’mon. I don’t know about anyone else but I am getting pretty frustrated with the out of control spending and the rush voting. If it is so wonderful, why can’t we take our time and make sure that what we are doing makes sense.

Related articles

• The End of HSAs (online.wsj.com)
• “The global warming scandal of the century” and related posts (michellemalkin.com)
• All the Demcare tax hikes from A to Z – plus SEIU’s takeover thesaurus (michellemalkin.com)
• Here comes Harrycare! (michellemalkin.com)