Even the Secretary Treasury cannot sell his home.

I received this interesting question from a reader last night:
I’ve been hearing a lot about inflation lately. But now I’ve started to hear about deflation. What is deflation?
An excellent question! At its most basic, deflation is a fall in prices. It is the opposite of inflation. In the sense of this economy, deflation is most connected with the stock market and with housing prices — both of which are falling. (Consumer prices haven’t quite reached a state of deflation, so it’s not very helpful to household budgets.)
One of the biggest worries right now is that the economy will enter a …read more

In California, one of the hardest-hit areas of the housing market crisis, one builder has a promotion that has been working for decades: Buy one, get one free.
That’s right. If you buy one expensive house, you can get a less expensive house for free.

Yesterday’s big news was the Fed rate cut. The practical optimists were thinking that a cut of about 25 basis points would be in order. The Fed rate cut satisfied all but the most gung-ho of bulls with a 50 basis point cut. So, how will this Fed rate cut affect the markets? And more importantly, how will it affect you?
Fed rate cut and the stock market
Yesterday saw the single biggest gain by the Dow in close on five years. Stocks are going ballistic right now, with investors thrilled by the Fed rate cut. Why? Because now money costs less. …read more

Many in the mortgage industry, and even some in the stock market, are putting a lot of faith in tomorrow’s expected Fed rate cut. The hope is that, as happened in 1998, the stock market and the U.S. economy with it, will bounce back from the edge of despair. However, the Wall Street Journal points out that this may not be the case:
“The bounce-back in the financial markets is probably going to be smaller than it was in 1998,” when the Dow Jones industrials surged 20% from its close on Oct. 1 through the end of the year, says Jan …read more