Castrophe: The Stock Market Crash of 2008
Filed Under Market Commentary |
Stocks crash as investors lose confidence in the system; having many wonder will we ever come back.
I am sure many investors are on the verge of giving up or already have. My curiousity has led me to open a poll…
The NASDAQ is down 26% since Americans elected Obama as our next President. Stocks are a forward looking indicator, and at this time stocks are not liking what they are seeing. It appears that this meltdown of our current broken (non-free) markets are headed for nationalization. Will this occur? It is anyone’s guess, but we have a ultra-liberal President Elect and Liberal Congress may have the gumption to pull off nationalization.Luckily, FDR and the two New Deals he brought into play were quickly eraticated once Democrats left office and sprung the market into a new Bull Market phase. FDR’s socialism still shines today and haunts this market. Fannie Mae price fixing mortgages, Community Reinvestment Act forcing banks to make subprime loans or face fines, and the failure of the Republicans to force Democrats to limit the powers of Fannie Mae and Freddie Mac are what is causing this terrible decline. Solution:
- Give mortgage borrowers the opportunity to refinance: slice 20% off their 1st mortgage and setting the rate at 5%
- Make all mortgage securites Tax Free like Municipal Bonds
- Government takes Preferred Stakes in Banks who participate, Banks after 3 years can buy back the preferred shares at a premium
Be safe and enjoy MS
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