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Sunday, January 6, 2008

Something good needs to happen

The mortgage / credit markets have been in a state of disarray since July 29th. As bad as it was then, it has only gotten much worse. The housing market is suffering mightily because of the lack of financing available for so many people. The market always over-reacts - on the good side there is irrational exuberance and on the bad side there is just flat out irrationality. Our country needs some good news on the economic front so that investors will have the confidence to invest which would allow lenders to make good loans based on reasonable guidelines which would, in turn, help to stabilize the housing markets which would bring back reasonable consumption and ultimately lead to an increase in wealth which has dwindled severely over the last couple of months.

Our country is facing major problems as an ever-increasing number of baby-boomers will be retiring over the next 15 years and very few of them are financially ready for retirement. As a nation, we need to invest and create wealth to finance our retirement rather than rely on more debt to finance our keep-up-with-the-Jones' lifestyle. While consumption is hugely important and there needs to be balance in all things, the imbalance that has occurred from too much consumption and not enough investing needs to be corrected or the government will have to do it for us and we all know how efficient the government is at fixing these king of problems - it will cost us far more than it should regardless of what party is in power.

I believe our media needs to focus on the great buying opportunities available in real estate. It needs to instill confidence in the public not paint pictures of gloom and doom that becomes a self-fulfilling prophecy. We need to be wise about our money management so that our legacy isn't one of financial ruin for the sake of our "eat, drink and be merry" and live-for-today attitudes. Choose the proper mortgage for the financing of your home by dealing with an educated Mortgage Planner; have a competent CPA handle your taxes to maximize your tax benefits. Hire a top-notch estate planning attorney to protect your assets and your legacy and invest in stocks, mutual funds, real estate, and other opportunities that will provide you with the possibility of a good return on investment while diversifying your portfolio. The environment isn't the only green thing that's important; our lives depend on good financial management in order to be able to have a stress-free retirement and a financial legacy we can pass on to our children, universities, and other beneficiaries.

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