Rush Limbaugh

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RUSH: As I mentioned right before the last hour concluded, the Associated Press: ‘After falling for six straight months, sales of existing homes posted an unexpected increase…’ Of course it’s unexpected! The experts at AP are always wrong. ‘…unexpected increase in February, which may have reflected more aggressive price cutting by sellers in some parts of the country.’ Well, of course. ‘The National Association of Realtors said the sales of existing homes rose by 2.9% in February to a seasonally adjusted annual rate in February of 5.03 million units. It was the biggest increase in a year and caught economists by surprise.’ Yes. Naturally, the economists are always caught by surprise. They’ve been expecting a small decline. ‘The trade group reported that the median existing sales price in February fell to $195,900. That was the largest year-over-year drop on records that go back to 1999.’ Existing home sales rise in February, and of course it’s because prices are coming down. It’s just another illustration of even in a bad market, a bad economy, somebody benefits. I use this example all the time. When the price of oil got down to $10 a barrel back in the eighties, domestic producers had to cap their wells. They could not make a profit.

Consumers were making out like bandits, but the producers, domestic producers were up a creek. Now, I’ll tell you, when this bottoms out — and I don’t know when this mortgage business and the subprime crisis and the credit crunch, are all going to bottom out, but they will at some point because they always do and there’s going to be a rebound. When that bottom occurs, I hope that you are in the Smart Money crowd that sees that bottom because there are going to be home deals like we haven’t seen in the longest time. And it’s going to be a buying opportunity for all kinds of people who are not yet in the home market and want their own homes. It’s going to be big. I have no idea when it’s going to be. You know what the biggest challenge at that point is when you buy your first home is kicking the homeless out of it, who have been living in it since it was abandoned during foreclose periods such as now. But even in the midst of this good news, Hillary Clinton has proposed that the government get involved in flipping houses. ‘Former Federal Reserve chairman Alan Greenspan and other economic experts should determine whether the US government needs to buy up homes to stem the country’s housing crisis, Hillary Clinton proposed today.’

‘She said the Federal Housing Administration should stand ready to buy, restructure, and resell failed mortgages to strengthen the ailing US economy. ‘Just as it has in the past, this kind of temporary measure by the government could give our economy the boost it needs and families the help that they need,’ Clinton said in a speech she gave not long ago in Philadelphia. ‘It would not require a single new government bureaucracy and it would be designed to be self-financing over time so it would cost taxpayers nothing in the long run.” When a liberal Democrat tells you that a government program is going to cost you nothing, of course, you grab the back pocket because the government getting involved is always going to alter the market in ways more than likely deleterious. She said that this group that she wants… Basically, she’s talking about flipping houses. She wants the government to get involved in flipping houses. She wants the government in the speculator market. This is precisely for two reasons: Democrats don’t trust the market — they want the government to take over as many of free market operations as possible — and they want you thinking that you have your house because of the government and because of Mrs. Clinton and because of the Democrat Party, so that you will vote for them. It’s that simple.

It is always, always, ladies and gentlemen, always about them. From Tokyo: ‘The United States should inject public funds into its financial system to solve the mortgage prices that has sparked global credit fears.’ This comes from Japan’s financial services minister, whose name is Yoshimi Watanabe. ‘Urging the US to learn from Tokyo’s experience during its bad loan crisis during which massive amounts of public funds were injected into the banking system, Watanabe also said Japan was willing to help solve the problem if needed. ‘It is essential for the US to understand that given Japan’s lesson, public fund injection into the financial sector is unavoidable.” Well, it’s probably unavoidable because we’ve got so many people running to do it here. But the Japanese had their own problems in this regard, and it was precisely… You know, you can trace it back largely to Japan, Inc., which was an association between Japanese banks and business and government. (laughs) It’s what caused their problem in the first place! So they just injected more money into it finally until… Their injection really hadn’t much to do with it. It was just market forces eventually playing out and turning around and straightening themselves out on their own.

Meanwhile, the Associated Press has this headline: ‘US Ponders How Deep is Economic Abyss.’ Well, I don’t even need to read the story, and I don’t even need to tell you what the story says. I can answer the question. How deep is the US economic abyss? It will be as deep as the Drive-By Media can make it. The Drive-By Media is doing everything that it can to create in your mind as much chaos as possible over the state of the US economy. And then there’s this. We got a whole Economic Stack here today of doom and gloom. ‘As hundreds of thousands of American homeowners fall behind on their mortgage payments, more people are turning to short-term loans with sky-high interest rates just to get by. While hard figures are hard to come by, evidence from nonprofit credit and mortgage counselors suggests that the number of people using so-called payday loans is growing, as the US housing crisis deepens, a negative sign for economic recovery. ‘We’re hearing from around the country many folks are buried deep in payday loans and debts as well as struggling with their mortgage payments,’ said Uriah King, a policy associate at the Center for Responsible Lending. A payday loan is typically for a few hundred bucks with a term of two weeks and an interest rate as high as 800%. The average borrower ends up paying back $793 for a $325 loan.’

We’re talking loan sharks. Three hundred ninety-one percent interest rate, plus fees and penalties of course — and you know what those can be if you don’t pay up. Now, none of this is official. This is all anecdotal, from a public policy center, the Center for Responsible Lending. Payday loans, as I say, are usually few hundred bucks, but the interest on top of the $325 loan equals a payback of $793. ‘They also estimate that payday lenders issued more than $28 billion in loans in 2005 according to the latest available figures. The loans on offer have an annual percentage rate of up to 391%, excluding fees and penalties. All you need for a loan like this is proof of regular income, even government benefits will do.’ So you go down to your local loan shark, you show ’em your pay stub, show him what’s coming, prove that you’re still employed, and you can get one of these loans to help stem foreclosure. Apparently, they say, many, many people are engaged in it. So the effort overall to portray the economy… Look, don’t misunderstand here, folks, I do not have my head in the sand. I am not saying everything’s rosy. I am not saying everything is being overblown, but there is a lot of exaggeration here on the depth of the misery, on the depth of the problem, and it’s something that these economic upturns and downturns are always cyclical, and the president had it right. We came out of 9/11 in bad shape. We had a recession in 2001. We’ve had much worse problems than this, and we rebounded just dramatically, as we always do. What the Drive-Bys are trying to do is dispirit people and ruin their confidence into believing this won’t happen, so as to accept stupid plans like Mrs. Clinton’s proposal to get the federal government involved in flipping houses.

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