Tuesday, July 7, 2009

The current market status...Oil, Housing, and Recession?

Ok, I%26#039;m no expert when it comes to business but couldn%26#039;t the market possibly be rescued with this simple plan? If the government would cap gasoline prices (since oil companies report record profits all the time) near two dollars, then there would suddenly be more money in the market. And as far as housing goes, the problem with the sub-prime mortgages was that the interest rate jumped from a low rate to a high rate so people could no longer afford them. Interest is all money in the banks pockets anyhow, and foreclosure costs them money, so couldn%26#039;t they just lower their interest rates again to the point where people could afford to make their payments. Not only would people be able to keep their houses, but banks wouldn%26#039;t be foreclosing (causing them to lose money) and would be making a small amount, just not as large as they would like. I know this is very brief, but wouldn%26#039;t a well-worked plan like this help the economy significantly?



The current market status...Oil, Housing, and Recession?bank loan





Putting a price cap on fuel will ultimately lead to shortages...



Most people would rather fuel at the %26quot;fair market price%26quot;.. than the alternative with no fuel at a capped price...



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By trying to cap interest rates at any rate.. why should any invester loan any money?



Meaning if I have money to loan.. shouldn%26#039;t I charge as much interest as the fair market will allow?



When the market caps at 1%-2% I should just buy gold and play the waiting game.



Does this help any?



The current market status...Oil, Housing, and Recession?

loan



Capping oil prices either means the government would have to pay oil companies the difference between the real price and capped price, or risk oil companies selling their oil to other countries where they are paid the full amount they charge.



The problem with sub-prime mortgages was not the interest rates increased, but rather that banks lent money to people who were security risks. If the government bails the banks out by further cutting interest rates, then they are sending a message to all business%26#039; that it is OK to take major risks because your government will always save you. This is not a good message to send unless you want more crises in the future.

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