It's amazing what you can accomplish if you want it bad enough. Hopefully, all governments of the world will take notice of this amazing event.
The message?: If you abuse "We The People" you will be taken down. If a brutal dictator like Mubarak can go then anyone can!
The market looks like crap today BTW. The fall of Mubarak should have sparked quite a rally. We have seen nothing of the sort.
On the news front the PIIGS are back:
"LONDON (MarketWatch) — Proving that the euro zone’s sovereign-debt crisis is yet to be vanquished, yields on Portuguese government bonds continued to climb to levels viewed as unsustainable on Thursday, prompting the European Central Bank to intervene.
Yields on the 10-year bonds soared to a euro-era high of more than 7.6% at one point Thursday morning, according to strategists. The European Central Bank later intervened to buy Portuguese bonds, several analysts said, after staying out of the markets amid relative calm in recent weeks."
The Bottom Line
The PIIGS issues and their massive losses have been hidden versus being solved. The same thing is happening over here. Keep "printing and praying" guys. Everything is just fine...NOT!
Geithner came out and discussed a new plan that will wind down Fannie and Freddie. It's too bad the plan is about 3 years late and lacked detail.
It is also way too drawn out. They say it will take 5-7 years to wind these two worthless entities down. This pretty much guarantees that the housing crisis will be stretched out for a decade as the government slowly gets out of the mortgage market.
The reality here is when they do get out than no one will be doing loans. Think about it: What bank is going to take on the risk of doing a mortgage without a guarantee from the government?
I wouldn't be lending if I was a bank. Who in the hell wants to lend people money for loans on houses that are still grossly over priced? On top of that who is left to qualify to buy with unenployment nearing 20%?
Also, note that the new requirements will demand that you have 10% down when the government leaves the market. Good luck with that one! How many borrowers have that? You probably just took out 70% of the buying pool with the 10% rule.
Don't get me wrong, it's a good idea. In fact, it should be 20% down like it was in the old days. This is called sound lending!
All I can say is good luck to the housing market as the government slowly backs out. You think things are bad now? Wait until the only lenders left are a bunch of insolvent banks that will only do prime loans with 10-20% down.
Housing is DOOMED with a capital D.