A week in the financial markets in these troubled times is all you need to realize how serious our problems are here in America. The Dow Jones Industrial Average has taken a wild ride mostly increasing about 200 points after the Federal Reserve Announced a large, unprecedented, and expansive cash injection into the U.S. economy. Over one trillion dollars ($1,000,000,000,000) is being pumped into our economy through the purchase of government securities (debt).
On Wall Street, toxic assets continue to eat through the balance sheets of banks even though most financial stocks are on the rise due to recent earnings reports. Foreclosures continue to grasp the nation’s housing market which contributes to the toxic assets on Wall Street, but fortunately ping housing prices brought on by foreclosures are fueling home sales.
The US savings rate is rising too since more Americans are saving their money out of fear of more job loss. Also more Americans are looking to debt management and debt settlement companies to help reduce their debt load and get out from under never ending interest payments.
Watch out for Deflation
Deflation is when the value of a currency increases in value. This can happened for many reasons but the current economic crisis is creating an environment of fear when it comes to deflation. Deflation is a bad thing because it increases the effective amount of the debt that you owe. For example if you owe $20,000 on credit cards and deflation occurs your $20,000 in cash you need to payoff your debt can now buy more and is more valuable. Deflation also holds down and decreases average wages. So basically your debt amount increases with deflation. Debt Settlement and Negotiations with banks is a great way to eliminate consumer debt before deflation occurs.
Mortgage News
This week President Obama was in California to sell his Mortgage Loan Modification plan that is supposed to slow foreclosures and in effect stop the housing crisis. The plan helps homeowners who are at risk of defaulting on their home loans because of job loss and homeowners who got bad mortgages. The plan is supposed to assist up to 9 million borrowers over the course of the next few years as the plan is uted. Under the new Obama plan, homeowners would be able to refinance their mortgages or do a loan modification to lower their payment and principle loan balance. Critics say that plan will help speculators, house flippers, and others who made irresponsible decisions when buying or refinancing their homes. Also loan terms could be extended up to 40 years.
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If you have any questions about the current U.S. economic conditions and how a loan modification, credit card debt settlement plan, or basic financial consultation can help you, please contact a Coastal Credit Solutions Consultant at 866.205.8370
We also provide information about the new Obama Loan Modification Plan... Call Us 866.205.8370
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