Help? Self-Help is the KEY for Homeowners with Debt Issues

by Ken Kappel on April 30, 2011

For years we’ve followed the formidable Steve Saville when it comes to matters of inflation, deflation, and what remains in the middle of the muddle. He writes at The Speculative Investor.

A recent article by Steve: Inflation, Bank Lending, and the Employment Spiral, puts it into perspective, which is easy to understand.  By clicking here, you can see his full article, including the charts he uses to prove out his thesis.

If you are a homeowner with mortgage/foreclosure issues, you need this information in order to formulate your tactics and strategy to obtain an outcome you can live with.

Let’s go directly to his work.

“Can inflation happen when the banks aren’t lending?

“We can state with absolute certainty that “yes” is the correct answer to the above question. We know for a fact that the total supply of money can increase in parallel with a contraction in the commercial banking industry’s collective loan portfolio because that’s exactly what has happened in the US since October of 2008….”

“Considering what has happened over the past few years, why do some analysts continue to claim that commercial banks must be willing and able to expand their loan books, and that the public must be willing and able to take on more debt, in order to get growth in the economy-wide supply of money? We don’t know; you’d have to ask them. Clearly, they are wrong.”

“The US money supply, when properly measured, has grown rapidly in the face of reduced bank lending over the past 2.5 years because the Fed and the private banks have combined to monetise a huge dollar-amount of securities. There is possibly a limit to how much the private banks can monetise, but the Fed’s ability to monetise has no rigid bounds. It really just comes down to how much risk the Fed is prepared to take in its efforts to “stimulate” the economy, and how much monetary inflation the bond market is prepared to tolerate.” [Emphasis Added.]

“When the US eventually reaches the point where “inflation” is widely believed to be the most important economic problem facing the nation, actions that put a stop to the Fed’s monetary profligacy could become politically feasible. We currently appear to be a long way from that point.” [Emphasis Added.]

Another nail in the coffin of the deflation argument

“The following text and chart are from John Hussman’s latest weekly commentary:”

…the poor performance of the U.S. economy from an employment standpoint cannot be separated from the Fed’s attempts, for more than a decade, to make easy monetary policy a substitute for the accumulation of real savings and investment. …Speculating and consuming off of cheap credit may feel better than saving, but the long-term results are profoundly different.

“It could be argued that factors other than the policies of the Fed and the US federal government have contributed to the multi-decade downward spiral in US employment growth …, but discussing these other factors only clouds the issue. The reason is that the reduction over time in the US economy’s ability to create productive jobs is consistent with what Austrian economics (good economic theory, that is) predicts would be the result of the market distortions introduced by the Fed and the government. Looking beyond Fed-sponsored inflation and the government’s meddling in the economy to explain the economic deterioration would be akin to someone sitting in a sauna, with the temperature control cranked up to the max, looking for reasons unrelated to the sauna for why he/she is uncomfortably warm.” [Emphasis Added.]

“Unfortunately, very few people are looking in the right direction in their efforts to diagnose the cause of the decline and come up with solutions. As discussed last week, that’s why we are long-term bears on the US economy. There will be no hope as long as the causes of the problem are misdiagnosed, because the proposed solutions will almost certainly be wrong if the true causes of the problem are unknown. In fact, if past is prologue then the proposed solutions will be exactly the opposite of what is required and will make things worse. For example, bad economists will recommend, and ignorant and/or unprincipled policy-makers will bring about, more inflation of the money and credit supplies in an effort to combat the problems caused by earlier inflation of the money and credit supplies.”

Ken here.  Get it?  We continue with the same failed processes.  Why?  Save the Too Big Too Fail Banks − that have already failed and are propped up with your/taxpayer money  Actually to save the individual Fraudulent Banksters that have failed − and who tell the Federal Reserve System what to do.  That would actually be the Wall Street Investment Banks that control our Economy, the White House, U.S. Attorney General, Congress and even most state Attorney’s General.

For homeowners with employment and debt issues, realize that those entities mentioned above − can not and will not − help you. They have other masters. Ever try to get a “free” loan mod? Good luck.  Few have succeeded because the Loan Servicers make more money by foreclosing on you.

Read our book, which gives you’re the required deep — the historical background − read ALL the posts on this magazine style Web-Blog (at least the headlines and a coupla paragraphs), which updates the book with current real-time required information.

The, let us know you have.  Soon, we’ll have an interactive form here on the Web-Blog, for you to complete, letting us know you’ve done your homework. We cannot help, or, provide tools until you’ve done that.  An eight grader can’t pass high school exams, they don’t know enough − yet!!!

When you are empowered with the required knowledge − thus courage − to Repudiate Predatory (Fraudulent) Housing Debt we’ll provide you with tools that can help you obtain your objective. Either a “fair” Short Sale, or Debt Reorganization to lower your principal amount owed to under current market value, with a new fixed, amortizing loan that you can afford.

It’s that simple − if you do the work − we’ll provide the tools.

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