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Have you metChad?

FNMA 4.0% : SLUMPED 19 bps…after being UP as much as 37 bps for some of the session. Money flowed from mortgage backed securities into the stock market despite fed buying efforts today.

DOW: NICE day…with a 200 point jump. Announcement that a "BAD bank" will be created to purchase "Toxic" bank assets fueled a jump in financials. (Wells Fargo JUMPED five BUCKS…my 401k cheered.) The "Bad bank" concept comes as good news to struggling banks…but wait a minute…isn't that what the "TARP" was supposed to be for in the first place? The BAD bank would buy up to a TRILLION in bad assets then be managed by the FDIC.

DJIA 8,375.45 +200.72 NASDAQ 1,558.34 +53.44 SP500 874.09 +28.38

FED MEETING Adjourns: Notes were released indicating that the fed will continue to buy mortgage backed securities and other instruments to help the ailing economy. No change to the interest rate. Interesting to see this news getting some of the credit for the rally in the stock market when it was in no way a surprise…

BIG FAT STIMULUS PACKAGE…coming up! YIKES! House passed an $819 BILLION measure to help stimulate the economy. I am CERTAIN that SOME of it has got to be good…but many feel it looks a little like a bologna sandwich. Why can't we see a "plan" that makes sense? Ever hear the cliche: "too many cooks in the kitchen spoil the broth." Checks and balances are great...but too many special interests and ulterior motives seem to be in play here.

The Stimulus plan outlines a way to create jobs at a price of an estimated $217,000 per job created. It is great to help create jobs...but only when that is sustainable or some type of "income" or "product" is created.

When jobs that rely WHOLLY on the tax base are created: taxes go up for all and there is ZERO net effect on our GDP...which is the official measure of whether we are in a "recession", "depression" or otherwise.

We have to "borrow" either way...but just less if we focus on accountability with government spending vs. dumping money on the problem with no regard for efficiency.

Also, we have a "need" to improve infrastructure...but I don't think many of us in the "real world" are thinking NOW is the time to be exceptionally laissez-faire with either "personal infrastructure" OR "borrowing EXTRANEOUS money" in our personal households...

Naturally a "do nothing" approach is not right either...

FACTOID: we have lost about $11 TRILLION in "wealth" as Americans… With that we "LOST" the ability to access and ultimately SPEND an estimated FOUR HUNDRED BILLION dollars in LIQUID money. Liquid "lost" in the economy is in part due to depreciation of stocks, bonds, etc…but a fairly LARGE portion is due to the inability of many to pull money from their home equity! This is due to slower home sales, changing underwriting guidelines and depreciating home values. We are proposing to spend nearly a trillion dollars to "REPLACE" 400 billion in SPENDING…Hmm.

Bright spots: Mortgage, credit card and auto loan rates are EXCELLENT, housing is priced right to buy, the local economy in most of our markets is doing really well. Brightest of all: most of us have clean air to breathe, people to love and love us back, warmth, mobility and freedoms to enjoy that others would die for.

Haveagreatday,

--
Chad Schauers
Have you metChad?
MetLife Home Loans
406.522.0922
406.522.0924 (fax)

1924 W. Stevens, Ste. 202
Bozeman, MT 59718

Cell: 406 799 8613
ccschauers@metlifehomeloans.com