Will The Government Bailout Help the Real Estate Market?

After all the hoopla of last week, the government passed a record Wall Street bailout package with the hope of easing the credit crisis. Now the question that is being asked is "Will the government bailout help the real estate market?"

From what I know of it, I can't figure out how it will. Much of the talk of the bailout seemed to center on unlocking the credit markets which experts had said were "frozen". That all seems odd, because mortgage financing wasn't frozen. During the entire crisis, there was abundant mortgage money available to qualified buyers. In the current financing climate, a qualified buyer is one who has money for a 10 to 20% downpayment (depending how how they plan to use the property), a good credit profile and can verify both employment and income. Since mortgage money wasn't frozen, I don't see how the bailout can help us there.

Another theme that was voiced was the need to help people who are behind on their mortgages so that they can stay in their homes and avoid foreclosure. I guess the idea there is that with fewer foreclosures on the market the oversupply of housing will be less. In our area, there are foreclosed homes on the market but they represent a very small percentage of the total inventory. There are homes on the market where owners are behind on their mortgages and face foreclosure, but those too are a relatively small percentage of the homes currently for sale. To what extent the bailout will help these people I don't know. But even if it does, it will impact a small percentage of the total inventory.

So when it is all said and done, it's hard to see where the bailout will help firm up the real estate maket in any meaninful way. It looks like we can expect prices to decline further which means we will have more of the problem that led to the bailout in the first place. Does that mean we can look forward to another bailout? Only time will tell.

Turmoil on Wall Street Allows Obama To Get the Upper Hand

The recent turmoil has clearly blunted the momentum that John McCain developed from his selection of Sarah Palin and the Republican Convention. He had a nice run where he had Obama on the defensive and the polls were all going in his direction. He had the high ground and was shooting downhill.

That has all changed. McCain stumbled when the s**t hit the fan on Wall Street and Obama gained the advantage. Now the polls are all going his way. Is all lost for McCain.

Hardly. Despite the reversal in the polls, people are still uneasy about Obama and that makes him vulnerable. Poll after poll shows that people want a change in direction but are uneasy about Obama as the man to lead the way. McCain can get back on top by exploiting that fundamental weakness in his candicacy.

Obama has taken to mocking, belittling and otherwise demeaning his opponent. McCain can turn that around by hammering home the point that this behavior clearly demonstrates Mr. Obama's immaturity and lack of leadership in this troubling and challenging time.

He can also demonstrate, once again, Mr. Obama's poor judgment by highlighted the ecomonic advisers he has on his team. Two of his most trusted ecomonic advisers are former heads of Fannie Mae and were responsible for the policies at Fannie Mae that led it's collapse. Since Mr. Obama's resume has nothing on it that could be call an accomplishment, judgement is all he has. Time and time again, Mr. Obama gives us proof, through his associations and policy positions that his judgment is seriously flawed and makes him a dangerous person to put in the White House.

No doubt McCain finds himself shooting uphill, but the situation is reversable. He needs to keep hammering home that point that most Americans already know and makes them very uneasy. Mr. Obama lacks the judgment, experience and the policies to make him the person to lead us at this time.