Ilyce Glink Show Notes – September 4, 2010
Unemployment Ticks Up, Stock Market Jumps, Double-Dip Recession?
In this week’s news:
- Unemployment ticks up to 9.6 percent. U-6 jumps to nearly 17 percent. The unemployment report for July was dreadful any way you cut it. While economists were expecting 40,000 new hires, we got 67,000 new hires. Great. Meanwhile, first-time filings for unemployment are still at 470,000. The employment rate went up to 9.6 percent from 9.5 percent, and 114,000 Census workers were fired. Overall, employment fell by 54,000 jobs. Let’s put it in perspective: The economy needs to CREATE 125,000 jobs per month just to meet the number of new workers who enter the market each month. In July, we lost 54,000 jobs, which means that the next month, we’d need to create 175,000 jobs plus 125,000 jobs just to make up for July and August. That’s 300,000 jobs – and we’re losing jobs each month. Three million people have lost their jobs in the last three years, and we now have 8 to 9 million people who have lost their jobs in this decade. And, of the 67,000 jobs that were created, 10,000 were construction workers who had been on strike and just went back to work. That doesn’t count as a new job in my book. Most of the gains have been in part-time work, not full-time, which says that people are desperate for any income at all and are taking part-time jobs they don’t really want.
- Stock market zoomed nearly 300 points this week to close at 10,447. You wouldn’t know that there was another awful jobs report from the way the stock market reacted. A little bit of sunshine (i.e. that we created 27,000 jobs than economists thought) goes a long way. And Ben Bernanke said he should have been more honest in stating that the government couldn’t have saved Lehman Bros., even as a Lehman executive said they could have. In any case, this was an up week for stocks. Next week will probably be a down week.
- Are we in for a double-dip recession? Dr. Nouriel Roubini, the noted economist and professor at New York University is speaking at an economist conference in Italy this week. He said in an interview in the Telegraph (a UK paperPaper is slang usage that refers to the mortgageA Mortgage is a document granting a lien on a home in exchange for financing granted by a lender. The mortgage is the means by which the lender secures the loan and has the ability to foreclose on the home., trust deed, installment, and land contract.) that the U.S. and much of the world no longer have any economic defenses left against a double-dip recession: “Dr Roubini said the US growth rate was likely to fall below 1pc in the second half of the year, despite the biggest stimulus in history: a cut in interestInterest is money charged for the use of borrowed funds. Usually expressed as an interest rate, it is the percentage of the total loan charged annually for the use of the funds. rates from 5pc to zero, a budget deficit of 10pc of GDP, and $3 trillion to shore up the financial system.” Dr. Roubini called the Great Recession accurately and largely predicted a world wide recession. I think that we need to keep an eye on what he’s saying. We could easily fall back into something that looks a lot worse than the past three years.
Americans aren’t optimistic about their prospects.
In the September, 2010 issue of Money Magazine, the results of a CNNMoney.com poll: How do you see your finances one year from now?
- 44 percent see their investments down and their job shakier
- 33 percent see their investments rising and their job more secure
- 12 percent see their investments up but their job shakier
- 11 percent see their investments heading down but their job is more secure.
What do you think? Over the next 12 months, where do you see your finances and job security going? Please leave your responses on the blog.
Refinance now, or forever hold your piece.
Mortgage interest rates fell to a new record low this week: 4.3 percent for a 30-year fixed according to the Freddie Mac. I just locked in on a 3.75 percent 15-year loanA Loan is an amount of money that is lent to a borrower, who agrees to repay it plus interest.. This is like free money. While I’m only saving an additional $59 per month on my loan, it’s costing me very little out of pocket so I’ll start saving within 6 months. I’m also restructuring my payments so that I pay off the loan in 14 years. Why? Because I last refinanced in November, 2009, so by the time I close, I’ll have just 14 years left on my loan. I don’t want to add to my loan term, so that’s why I’m only saving $59 per month instead of more than twice that.
Here’s what I want to you understand: If you can refinance (you have the equityYour share of ownership in a company. Stockholders are often referred to as equity investors, because they invest in the equity of a company. , cash and credit score) and haven’t started the ball rolling, GET MOVING!!! These are the interest rates of a lifetime.
Shopping for a Short Sale? Want to buy a ForeclosureForeclosure is the legal action taken to extinguish a home owner's right and interest in a property, so that the property can be sold in a foreclosure sale to satisfy a debt.? Come to our HOW TO PROFIT FROM FORECLOSURES Event on OCTOBER 2, 2010
We’ve signed up a bunch of new sponsors and speakers for the event, including:
Joel Miller. He finances commercial real estateReal Estate is land and anything permanently attached to it, such as buildings and improvements. purchases $1 million to $40 million. He also does business financing as well as the real estate financing.
Monte Smith, Education director for Entrust in Georgia. He’ll be talking about Self-Directed IRAs and how to finance the purchase of your real estate investment using IRA funds.
Eric Weiss, Schulten, Ward & Turner. Eric is a top commercial real estate attorneyA Real Estate Attorney is an attorney who specializes in the purchase and sale of real estate. who helps his clients think through the business terms of a proposed foreclosure deal as well as walking through and creating the paperwork.
Georgia Association of Enrolled Agents. Bill Nemeth and his crew will be around to answer all of your real estate investing tax questions
Andy Heller, successful real estate investor, bestselling author and founder of RealtyJoin.com, a social networking site and business marketplace for real estate investors. Andy will discuss his lease/option platform and what’s been happening with his 25 rental properties.
Ricky Novak, Strategic 1031 ExchangeA 1031 Exchange is a means used by investors to defer the payment of federal income taxes. The owner of an investment property will sell that property, deposit the funds with an intermediary company, later buy a replacement like kind property and defer the payment of all federal income taxes. There are many rules that apply to these type of exchanges. Company. Ricky has wide-ranging experience as a real estate attorney, tax expert and can discuss 1031 exchanges and conservation tax credits.
John Damiano, RE/MAX of Greater Atlanta and head of the Providence Group. John and his team work with a ton of foreclosures and short sales and he’ll be sharing his advice on how and where to find foreclosures in the morning session.
Michael Bull, Bull Realty. With more than 30 years of experience, helping his clients purchase, sell, and manage billions of dollars of real estate, Michael is going to share his inside knowledge of the commercial real estate world, helping you find and buy commercial foreclosures.
And for our AFTER HOURS INVESTING PANEL we have Kay Shirley and I will be discussing what’s going on in the stock market.
Go to RealWorldSeminars.com and check out our speakers for the event. We’re also updating the blog with insights from our speakers and sponsors.
Don’t miss out – the 2for1 discountNewly-issued bonds are typically sold at some sort of Discount. So a bond that has a face value of ,000 and sells for 5 has a discount. When interest rates rise, bonds are discounted more because you need a less expensive bond to achieve the same interest rate. will expire after Labor Day!!!
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On the flip side of the coin, for every house that goes into foreclosure, there’s a real estate investor waiting to scoop it up and turn it around for profit. That’s why we’re holding our next event, How to Profit from Foreclosures, this fall. Atlanta is one of the top cities for foreclosures in the nation, and prices are dropping. If you’ve ever thought about investing in real estate (single family homes, condos, townhomes, office buildings, strip centers, warehouses, etc.), now will probably be the best time in a generation.
Our How to Profit From Foreclosures event is designed to provide you with up-to-the-minute knowledge from the very best real estate investment professionals who do this every day for a living.
They’ll share their secrets, their tips, their insider information to help you make a smart investment decision. DON’T MISS THIS!
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This week on CBS MoneyWatch.com
A New Home Buyer Tax CreditA Tax Credit is an amount by which tax owed is reduced directly. In other words, a dollar-for-dollar amount is subtracted directly from the taxes you owe.? HUD Not Ruling It Out