Blog with MAE Capital

 

Today’s topic might be a bit confusing to some, but rest assured if you know, you can make the right decisions with your money.  We are all seeing a tightening of money lately due to inflation which is where prices of goods and services go up faster than income does.  Inflation is the worst possible economic effect on any society as the people who are affected by inflation have less disposable income left over after they pay for housing, food, gas, and services.  In America, there is a significant amount of people that live paycheck to paycheck meaning that they spend every dollar they make on housing, food, fuel, and services every month.  When these prices go up and their income does not follow then people have to go to other sources to make those essential payments such as credit cards and this puts the average American in a deficit.  Although this is not good for the average American it is also not good for the banking system as the banks rely on the deposits of Americans so they can lend out that money to keep the banks in an income stream.  

This brings us to the banking system itself and most see the system as confusing and have no idea how banks actually work.  In America and other Western countries, the banking system is what is called a Fractionalized Banking system.  That is a big word that means that the banks can lend out most or all of the depositor’s money.  For example, if a bank has $100,000 in deposits from 5 customers ($20,000 each) and it pays 3% interest to those customers the bank then can lend out a good portion of that money at higher interest rates.  Remember that the banks have to keep cash on hand in case their customers need cash and in the past banks have held back about 10% of that money for cash.  The other 90% is lent out at a higher rate than they are paying the customers that have savings in their bank.  In our example, there is $100,000 from 5 people paying them a 3% return to keep their money in the bank.  The bank can lend out $90,000 and only keep $10,000 for cash reserves and when they lend out the money they collect say 6% on the money they lend out.  This process should leave the bank positive in income and has throughout the history of fractionalized banking.

Here is the problem with the system.  Banks currently have no reserve requirements meaning that in my example the banks can legally lend out every dollar of your savings.  This should not happen, and most banks will not lend out 100% of their customers’ deposits as they want to stay open in case there is a day when there is a heavy amount of withdrawal money.  Banks are in charge of regulating themselves based on their lending models and most banks do a good job of regulating this.  Here is the biggest problem facing the banking system today and that is inflation.  As we talked about earlier when prices go up faster than incomes the bank’s customers are spending more than they make and they do this with credit cards and equity loans.  There will come a point where the average American can no longer pay their debt due to inflation.  Human nature is to make sure they have food on the table first and foremost.  When the consumer can no longer pay their debt, they default.  This means that if Americans can’t pay their credit cards they go into default and the bank receives no money.  This holds for mortgages as well.   

This is where things start to get crazy so hang on.  Remember, that Banks will lend out around 90% of depositor’s money and if those loans start to go bad there is only 10% of cash left for banks to operate.  So, a bank’s reserves may get eaten up quickly if there is a high default rate.  Banks lend out money for Credit Cards, Residential Mortgages, and Commercial Real Estate loans and lend to other banks.  When customers start to default on their loans the income stream to the bank is greatly diminished and they still have to pay interest on the deposits they have for their customers.  If the bank has not held enough in reserves to account for this then the bank will fail.   Or as we saw in 2008 when this started to occur the government stepped in to save the larger banks not through the use of the Federal Deposit Insurance Corporation (FDIC) but actually printing money to put back into the system.  The smaller banks were bought up by the bigger banks.  In 2008 we had other factors going on to bail out the system as we were not in an inflationary time it was more of a recession meaning the economy was retracting with no inflation.  Real Estate values during this time went down the stock market sold back and there was high unemployment due to the recession.   Interest rates went down during this recession as there was no real inflation so with lower interest rates those who had the means bought homes and commercial real estate as the cost of money was cheap and this brought the economy back.  

Fast forward to 2020 when the COVID crisis hits.  This was a forced recession by the government telling people they could not work.  We had never seen anything like this in American history and the result was that the Government and the Banking system were faced with something they had never dealt with before.  The mistakes that were made have led us to where we are today.   The biggest mistake was to shut everything down that was not essential.  The next mistake was that the government did not take into consideration where we were in the business cycle with a healthy economy at the time before they shut the economy down.  The Government printed and sent out money to every American and it may have helped some in the short run the long run is what we are paying for today.   The Government also lowered interest rates to stimulate the economy and it sure did with people buying houses and freeing up equity to buy more stuff.    The money was flowing through the economy and people were buying things at a crazy rate until inflation hit people had to slow their buying habits and in addition to that the Federal Reserve saw the inflation and the only tool they had to slow inflation was to raise interest rates and they did.

Today all that stimulus money is gone, however, the government has continued to spend money by sending it overseas and starting foreign wars.  I can guess that the reason for the wars is to get the economy moving again as war requires a lot of money to flow.  We could go into the problems of this all day long, but this is not the forum for now.  The problem is, currently with the high interest rates and high inflation the more the government spends the less the dollar is worth on the world stage.   That coupled with the BRICS system that threatens to remove the Petrodollar on the world stage is further devaluing the dollar.  The banks are starting to see their default rate climb with inflation and this is diminishing the bank’s liquidity as this continues to happen, we see a tightening of the availability of money.  Today March 11, 2024, the Bank Term Funding Program (BTFP) which is a way for banks to secure funding from the Federal Reserve will be ending.  This will force the banks to go to the discount window to borrow short-term funds.   This will lead to money being tougher to borrow.  We are also beginning to see defaults start to rise and that coupled with the already tight money supply for Americans high interest rates and rising inflation it is a wonder why this is being done.  Is it being done so deliberately?  You can’t help but think there is some master plan to change the monetary system in America or to create a global currency minus Russia China, Brazil, India, South America, and countries in the Middle East (the BRICS nations).  But why?

I am beginning to think that all this stuff we have never seen before such as wide-open borders, money being sent to some foreign war nobody seems to want, money given to illegals, civil disruption, and propaganda being spread all over, is all part of a plan to make America weak.  The reason is to change the monetary system and move to more globalization that not many Americans want.  I see the UN helping in this destruction of America in that they are funding the illegal migration and to make it worse the US is the largest supporter of the UN.  I mention this not to scare you but to open your eyes to the great sellout of America and a move to the International Monetary Fund or something else, instead of the Central Banking system we currently use and enjoy independently of the rest of the world.  Before this can happen the Banking system in the US must collapse and it appears from someone who has watched and studied this for the last 45 years that this is what is happening.  I don’t want to scare people and I might be stating the obvious, but things are changing fast.  I am not holding out much hope for the Federal Reserve to lower interest rates any time soon as we still have inflation, and this is known not by the numbers the government feeds us but by simply going to the grocery store and filling up my car.  The mortgage business is the slowest I have ever seen, even worse than 2008.  This is also true for the Real Estate market and as things get tighter we should start to see more inventory hit the market as people are having a tough time paying their mortgages even if they have a 2 or 3% mortgage.  I am also seeing more people defaulting on their mortgages creating a higher foreclosure rate.  We as Americans can only do one thing to fix this crisis and that is to vote correctly, although I live in California and the system has been corrupt for decades it’s all we have to save our Constitutional Republic.  

Posted by Gregg Mower on March 15th, 2024 11:01 AM

The title says it all if you know what you are looking at. A little history first then we will dive into the relationships between BRICS, the Dollar and Interest Rates and it will wake you up if you haven’t been watching the world.  BRICS is the formation of a new currency based on precious metals formed to take on the dollar as the world’s new reserve currency, we will get more into that in a minute.  The Dollar is our currency in the United States and is the current world reserve currency.  Then how do interest rates play into this equation you ask?  Interest rates may not react now to both of these currencies now but they will very soon.

BRICS stands for Brazil, Russia, China, and South America, they were the original nations that signed on to use this new currency.   Since the formation of BRICS, Several other countries have signed on to use this currency,  countries such as Saudi Arabia, Syria, Afghanistan, and several others countries.  What this means is that these countries will use the BRICS currency as their reserve currency, not the US Dollar.  This has not materialized yet but it is in the works.   If this new currency catches on and becomes the world’s reserve currency and not the dollar that could have to reach economic consequences for the Dollar.  If you are paying attention to what is happening in Ukraine right now you have to understand that this conflict is not about Ukraine’s sovereignty from Russia it is about money.  Money has driven almost all wars in history and this one is no different.  

The Dollar has been the world’s reserve currency since World War 2 and before that, it was the Pound Sterling (British Currency).  The Dollar was originally backed by Gold and Silver.  When the US was limited to gold and silver it could not expand as fast as those that held the gold and silver wanted it to so it moved from a currency that could be backed by precious metals to the Federal Reserve Note we have today.  That transition happened in 1971 under President Nixon.  The US moved to what some call a “Petrol Dollar” which is a dollar backed by oil.  Again, we have seen wars fought over oil now, why? Money.  Today’s Dollar is really only backed by debt and that is why the world sees the dollar as a dead currency where the debt has exceeded what a normal mind can grasp.  $33 trillion dollars is a number that is not quantifiable to a regular person, numbers like that are for mathematicians.   The dollar has been the great magical vehicle for decades with people believing it has actual worth and that belief has allowed the US to become the largest superpower in the world.  

Interest Rates, how does it play into the currency game?  This one will take a history lesson as well.  Interest Rates, by definition, are the cost of money.  Interest Rates in the US have been controlled by the Federal Reserve and the Federal Reserve also controls the Money Supply.  We can now see the relationship as the Federal Reserve controls both the supply of Dollars and the cost of the Dollar.  The Federal Reserve system has been under fire lately with the way they have managed this relationship as we have seen interest rates soar over the last few years.  With the dollar as the world’s reserve currency for so long the Federal Reserve Bank has been lucky that countries like China and other countries that hold a large stake in the US debt have not called it due.  If the world moves away from the Dollar as a reserve currency you will see the devaluation of the dollar worldwide and those still using the dollar will see it be devalued on the world stage.   A devalued dollar will create inflation and the cost of the money will have to go up to offset this.  The cost of money is interest rates.  

This is just a quick view of those things to come and can also explain what is going on in the world today. If you connect the dots you can see why BRICS has come to fruition.  War in today’s world is being fought on the economic front not so much on the battlefield.  If the BRICS currency takes over, the dollar will devalue and the cost of things in the US will skyrocket.  If we have high inflation we will have high-interest rates.  When you look at the conflict in Ukraine understand it is not about Ukraine at all, in fact, if you look at Ukraine you will find that their government has been corrupt for decades.  If you research President Zelenskyy you will see he started off in life as a comedian and actor and worked for a TV station prior to being “elected” President of Ukraine in 2019.  Zelenskyy’s net worth is estimated to be between $20 and 50 million US dollars, and some estimate it far greater than that.   Meanwhile, the US has recently sent Ukraine over $120 Billion in aid.  These are facts; you can even google it and see that the search engine has not yet closed the door on this information.  It is on top of this administration’s list to keep the dollar as the world reserve currency to keep America the strongest and richest country in the world.  When you are watching or listening to the news, however, you find your information, keep money in mind when watching as that is the underlying cause for almost every conflict in the world is money.   I tried to keep this to facts that we know, but I think if you peel the onion back a bit more you will see things and understand things that you may not want to have knowledge of.  There is a lot more to this that I can’t possibly go into for this short blog post so keep your eyes and mind open.  

Posted by Gregg Mower on February 27th, 2023 1:40 PM

 

I am going to start this by stating that this is not meant to be political but it sure is going to sound that way after I give a true and accurate accounting of what will happen economically to the US if this Student loan forgiveness is allowed to go through.   I will not even get into the extreme unfairness this is and the blatant attempt to get votes this is, that would not be productive to the economics of this.  We are going to explore history, and what happened in the past when the Government tries to spend it’s way out of inflation and a recession.

 It appears the current administration believes that the value of the dollar will not decline if they put more dollars into the economy.   That is like saying if I gave you more money what would you do with it?  Then give everyone more money and ask what they are going to do with it.   You would be right if you said they are going to buy things with the money, cars, houses, clothes, vacations, electronics, etc..  Logically, you can say if more people are buying more things and those things are in high demand the price of those things will go up.  This is called inflation.  Inflation happens when more people want the same things and the supply can’t keep up with it.  If you forgive someone’s debt it is like giving them a raise, they will have more money every month to spend if they are not spending the money on the debt they owe because the government paid it off.

As you ponder that basic economic theory, let’s look at the effect on the value of the dollar worldwide and how that will affect you here in America.  So, our government gives its citizens money, and in this case to pay off debt.  By doing so they put more US dollars into circulation and that will devalue the dollar worldwide.  Why? Simple the more of anything everyone has the less value it will have.  For example, if I produce a specific widget and I have more than I can sell I will have to lower the price of the widget to sell them.  The same holds true with the dollar, the more US dollars that are out in the world the less value they have to other countries.    If other countries, see our dollar as plentiful or in oversupply then they will ask for more dollars when they sell stuff to the US thus inflation.  This type of economics is called Keynesian Economics and in the history of the world this has never worked, kind of like socialism has never worked, I digressed.  

I told you I would not get into politics here so I will give you the facts and you can do what you want with the information.  Keynesian economics is a tax and spend way of running a monetary policy.  Yes, after the spending will come the taxation, it is inevitable and already shown by the government wants to hire 87,000 new armed IRS agents.  It doesn’t take much of an economic mind to see what our government is trying to do.   When you couple the climate change agenda with all this and the slowing of domestic oil production you are staring at an economic disaster.  The people it will hurt the most are those older folks that have saved for retirement all their lives to see it all erode away with poor government money management.   

Again, trying not to be political here, but I am 59 years old and have seen this disastrous mindset in the early to late 1970s.  Back then the monetary policy was very similar to today’s tax and spend mentality.   Where that ended up was high inflation and high-interest rates which was called stagflation (a stagnant economy with high inflation).  I started in the mortgage business in 1982 and mortgage interest rates at the time were hovering around 18-20% for a fixed rate loan for 30 years.  We have just seen mortgage rates jump from the start of the year (2022) when they were at a nice 3-4% to a staggering 5-6% with no end in sight for how they will go.  The Federal Reserve (for those that don’t know is not part of the Federal Government they are a Central Bank that other banks use), has vowed to continue to raise interest rates until inflation gets back down to 2%.  Anyone can see that under this tax and spend regime we will never get there, so interest rates will continue to rise.  If you go back to my previous posts from last year you will see how correct I have been in my predictions.  

You might be making more money now at your job and that is great but now if the government cut your expenses more than half you would have even more money to spend.   Initially, you think this is a great deal but eventually, you will have to pay for it and in the end, you will be paying a lot more than the short-term relief you got.   It is simply the price of everything that went up and so has your tax obligation.  The more money you make the more you pay in taxes.   Next, the Government will raise your tax rate to cover the short-term benefit of getting your student loans paid off, and over your working life, you are paying more in taxes than the student loan was by about 10-fold.   So not to be political, but would you rather pay fewer taxes and have more freedom to open a business and not worry about the government coming after you, or would you rather pay more taxes and see the government pay for people that have not contributed to our economy in any way or send money overseas?  Or simply put would you like to put your neighbor’s kid through college or your own kid?  If you are close to retirement and you have saved all your life for retirement, would you like to see the government tax your retirement away to pay for people you don’t know and suffer because of it?  If you are a first-time home buyer, would you rather pay a 3% interest rate or a 6% interest rate and be taxed on your income at a higher rate?  If you said yes to any of the above then your wish has been granted by this administration.  Again not being political, I can’t stand back without informing those that have not had the benefit of a good education to fully understand the principle here.  You can probably tell I don't like the idea of paying off student debt or any frivolous government spending that appears to be only for getting votes at the expense of every American.  

Posted by Gregg Mower on September 1st, 2022 12:00 PM

As we embark into 2019 I enter my 35th year in the industry.  Not saying I have seen everything but I have seen enough to know what is around the corner for Real Estate and Interest Rates.  History seems to have a way of repeating itself over and over especially with Real Estate and market trends.  So as you read this you will see references to the past as that is how the future is formed and it has worked consistently for the last 100 years now as we have become a society of growth and invention.  But over time we as humans seem to follow the same trends and patterns in Real Estate and the Stock and Bond markets are no exception and we call this the “Business Cycle”.

The Business Cycle is a repeating cycle of booms and busts or good markets and slow markets.  In Real Estate and the Stock markets you can really see how this plays out with increasing home prices and lowering home prices and the Stock market going up then sagging back down over the business cycle.  The business cycle in Real Estate starts with investors entering the market picking up good deals (as they perceive it to be be) usually after a bust in Real Estate prices.  Once investors have taken a good hold in fixing and flipping or creating rental portfolios you start to see the first-time buyers enter the market.  When the first-time home buyers are buying and home prices begin to rise again you will see the move-up buyers enter the market creating more inventory. Eventually, over time the supply from the move-up buyers and the new home builders cools the prices from rising as the supply of housing catches up with the demand for housing.  When the supply or quality homes for sale becomes greater than the demand you then get a cooling down of the Prices of homes.  You will also see new home builders entering the market when the demand for homes is the highest and the supply is the lowest creating a greater supply of housing.  This is the Real Estate Cycle that has existed since the beginning of private land ownership.

This is important to know as if you can pinpoint where we are in this cycle you can formulate a plan to buy or sell Real Estate.   As far as interest rates are concerned the cycle is about the same but a little lagged compared to the Real Estate cycle.  This is simple economics, as well, when the demand for money is the highest (generally the peak of the Real Estate Market) is when the Federal Reserve starts to see inflationary numbers such as lower unemployment, and rising consumer prices.  You see housing drives the US economy as most products and services are designed for your home and when there is a high demand for these goods and services you will see prices start to rise.  That will trigger the Federal Reserve to raise interest rates to combat the possibility of inflation and the devaluation of the dollar.  I know this is a whole bunch of economic principles here, but this is how the business cycle works.  I could go into specific details as I hold a degree in economics, but this would bore you and I want to inform you so you can be ahead of others that are not smart enough to read anymore. 

As you see interest rates start to rise you will see almost an instant slow down in the demand for housing and goods and services as people can no longer afford to purchase the high-priced homes with high interest rates.  This, in turn, slows the whole economy down.  The Federal Reserve (the Fed) can’t possibly know how much interest rates should rise to slow the economy down to an acceptable inflation rate of 3-4%.  The Fed will generally raise rates too high initially and slow the economy down too much then rates sag back down until the economy is stimulated again then they raise them to get to the right inflationary numbers.  Since it is not an exact science we see volatility and this is where I believe we are at in the business cycle currently.  The Fed has not landed on the right interest rate combination yet and thus we are seeing volatility in interest rates and coincidentally the Stock Markets as well.  The Stock markets knows this cycle and reacts to it, as well, that is why we have seen record swings in the Stock markets in the last several months. 

So, we know where we are in the “Business Cycle” and we have seen the higher rates and the Real Estate Market slowdown in the 4th quarter of 2018.  Does this mean we are in for a bust?  I don’t think a bust is in order, but I do see a slow down and a leveling off in Real Estate prices and in some cases a decrease in perceived values.   Coincidently, this cycle has worked over a pretty consistent 10 year cycle with the slow down starting in the 8th year of each decade and going though the 9th year and slowly picking up with investors coming in on the 10th year.  For example 2008-2010 was slow for Real Estate as was 1998-2000 and 1988-1990 and so on, history repeats itself.  I am not saying that you should not buy Real Estate during these times I am simply pointing out the business cycle in Real Estate so you can be informed.  There are always deals out there and with the right Realtor and Lender partner like MAE Capital Real Estate and Loan you can profit.  With our experience you can make a plan to own Real Estate and not worry about the business cycle as interest rates are still low compared to history and there are some really good deals out there to purchase.  So, beat the investors to the punch and get in the game with your first home or your 20th home, we are here for you.  In our site you can look at properties currently listed on the MLS and get pre-approved all from your chair at home or work.   Give us a call and let our experience help you plan your future at 916-672-6130.     

Posted by Gregg Mower on January 8th, 2019 12:17 PM

Ok I know most of you shy away from the term “Economics” as it sounds like a college class you hated to attended.   The reality is the more you know the better off you are.   Real Estate is a volatile commodity meaning it can move up and down in value rapidly, so if you can predict the up cycles and the down cycles you can learn to profit from investing in both cycles.  Real Estate as an industry has been the strongest investment above all other investments over the last 200 years since we have been taking record of it.  If you look at the mix of investments of the richest people in the world you will see the largest source of their wealth is their Real Estate holdings.   But acquiring Real Estate can be difficult especially in this new regulatory environment so owning it makes it that much more important, whether it is your personal home, a commercial building or raw land it all is going to increase in value over time.   The reason Real Estate will continue to increase in value over time is the simplest of all economic terms, supply and demand, there is simply a limited supply of land and there is always a demand to own it.  As the demand for land increases with increases in population over time the price of land will increase, simply because people will pay more to own it when it is in limited supply.  The best example of this New York particularly Manhattan as it is an Island and there is only limited space on it to build and what you see is high-rise buildings with extremely high Real Estate Values as there is a limited supply with a high demand for it thus high prices.

Supply and demand theory is the most basic of all economic terms, whether it is pertaining to Real Estate or any other kind of product or service.  It is really simple in that the higher the demand for a good or service and the more limited supply of that good or service the higher the price will be.  When the demand for the product or service and the supply is being provided at the same rate the demand for the good or service is that is said to be in equilibrium thus you would have stable prices.  The interesting thing about Real Estate is the fact the you can’t make more of it, there is naturally a limited supply.  This is especially evident in high density populated areas.  Areas like New York, San Francisco, Los Angeles, and generally any urban area where you have good jobs and high demand for housing.  In Real Estate you also have the desirability factor, areas within those high density areas that people want to live in such as Beverly Hills in Los Angeles, Santa Clara by San Francisco, and Manhattan in New York.  Those are just some of the most publicized areas in the US, but within every High Density City there are particular areas that surround it that are more desirable than other areas within the area and those areas will demand a higher price simply because of the demand to live there.  Location, Location, Location is what us in the industry refer to as the 3 most important aspects of Real Estate investing as the better the location the more apt the value will increase at a faster rate than the normal increases seen by the national averages.

To take the economics of Real Estate even deeper we need to look at where the good paying jobs are located or are going to be located.  This is important for no other reason than affordability of homes around locations where there are good paying jobs.  Without employment people can’t afford to buy homes, commercial property, or land.  Yes, this is probably the best kept secret from potential Real Estate Investors as not all Real Estate investments are good ones.  You see, you could buy cheap land out in the middle of the dessert or in swamp land, but is that a good Real Estate Investment, probably not, for no other reason than there is generally no demand for this land as there are no jobs located close to that cheap land for others to want to live there thus low demand and low prices.  Real Estate speculators will generally look to invest in areas where large companies are planning to move or expand.  A good example is the new Tesla factory being built outside of Reno Nevada near Sparks Nevada.  This land has been basically desert land with no real value, but now with a new factory that will employ hundreds and thousands of workers the land surrounding that factory is rising in value in anticipation that workers will need housing and services close by the factory.  Right now with the factory under construction you have seen an increase in employment, thus creating demand for housing so you have seen increases in Real Estate values as a direct result of the construction workers.

The availability of credit is an economic factor in Real Estate that is not talked about much, but you can see as it becomes tougher for the average American to borrow money to purchase housing that housing price increases slowdown in general.  This is a simple principle of supply of available money which means the more money available to potential Homebuyers the more they can buy and less money available the less they can buy.  Why is this important?  As the Government imposes more lending restrictions the tighter the supply of available money becomes allowing for less people to enter the housing markets.  Again, the less supply of good Homebuyers the less the demand becomes for housing then prices have to go down to stimulate demand.  When Government intervenes into a free market by creating limitations what you get, in the case of the Real Estate Market, is less people being able to obtain credit thus less people being able to obtain housing.  For example, if you tend to believe and vote for those that want to regulate lenders and how credit is delivered you will be voting for slower increases in Real Estate particularly in the single family home arena thus trickling down to all aspect of Real Estate.  The Dodd Frank Act of 2008 was the Government and your elected officials creating a new Agency, the Consumer Finance Protection Bureau (CFPB) designed to protect the consumer from bad lenders and regulate how consumer loans are delivered to consumers.  Since the creation of the new multi-billion-dollar agency it has created licensing for loan officers, restrictions on underwriting guidelines, and have made lenders culpable in every loan they fund making lenders less apt to approve challenging loans.  Before this Agency was created and the regulations it has imposed on the industry, if Lenders made bad decisions they would lose money or go out of business or both, but since the Agency not only can that still happen but if they make a decision that the government doesn’t like they face stringent fines and penalties.  So as a result of the legislation lenders are lending to far less people than in the past, thus creating a credit drag on the availability of money to borrow to purchase homes and slowing the economy in general.

Housing creation tends to bring about other increases in Real Estate demand such as commercial and industrial Real Estate.   You see, the more people that live in specific areas the more the demand is for commercial goods and services such as shopping malls, Grocery stores, and other consumer services like Plumbers, Electricians, Contractors, Appliance repair shops etc..  Demand for housing itself is important but the net effect on the surrounding Real Estate for those support services is equally important as commercial development brings up Real Estate values across the board as well.    As you can see the cycle of Real Estate itself will bring about jobs that will bring about demand for housing, so if you have a healthy Real Estate market you probably have a healthy economy in general.   The more you regulate this industry the less opportunity there is for growth and the less opportunity there is for a healthy economy. 

We as Americans need to be more educated not just in Real Estate but in all things so we can continue to be the best country in the world.  If we allow our elected officials to govern the Real Estate markets or the Free market system that our country was founded on, then we will end up being a stagnant country with little or no growth or the ability to achieve a better for future for the generation of Americans.   We have to be smart and not rely on the government to police the markets, it should be up every American to choose what good or service is best for them and if they have been wronged by a provider of a good or service there are avenues to communicate this, and if the provider of that good or service, no matter what their size is, does not fix the issue they end up going out of business and not bailed out by the Government.  We have put way too much authority in our Government to police the so called free markets.  In doing so we have created a monster of a Government that will keep needing to be fed, and that will eventually fall back on every American in the form of increased taxes and decreased freedoms and liberties.  To fix this problem will only come through education, so whether your education comes from the internet or formal schooling never stop learning and never close your mind to opposing viewpoints and never trust the government is doing the right thing for you.  Even if you work for the Government you can keep educating yourself and your family and maybe someday you will be able to branch out and enjoy the freedom to work for yourself and build something that will be lasting for you and your family and the American people.  And lastly a final thought; America was built on freedom and capitalism, that is what made America great and the envy of the world, so do not give up on those basic principles of the American way.  

Posted by Gregg Mower on February 24th, 2016 2:07 PM

Archives:

Categories:

My Favorite Blogs:

Sites That Link to This Blog:


MAE Capital Real Estate and Loan

CA DRE #01913783|NMLS #806170

4940 Pacific Street Suite A
Rocklin, CA 95677