Daily Intent

December 2008 is here!  A month of the great Becky Bochsler’s Birthday.  Holiday parties light up the early daily darkness.  Trees have been lit.  Homes are covered in an assortment of colors.  Food bearing warmth is a plenty.

As the holiday party season presents many opportunities to discuss business, whether welcomed or not, here are some quick thoughts on the auto industry.

Big business.  They are phenomenal in good times as they provide plenty of opportunity for millions.   They  make billions, lead to societal progress, innovativeness and offer a bit of American pride.

Reality is, none of the Big 3 auto makers have fulfilled these benefits in a strong economy.  The only thing they’ve done in the good and bad times as of late is provide a safe haven for workers.  No societal progress.  Little American pride.  And definitely not the billions of income.

Ayn Rand’s, “Atlas Shrugged”, provides perfect imagery of what protecting such companies can do to an economy.  It ultimately deteriorates the country.  Lowers morale.  Encourages corrupt thinking and ways.

These are sensitive times for our economy.  We need to let them down easy and say good bye to great companies of the past…during the wars of the early and mid-1900s.  We need to take care of their people.  Train their current workers and place them in companies fit for competition in the 21st Century.
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Buzzword: Gazump

“A situation in which the price for real estate or land is raised to a higher price than what was previously verbally agreed upon.

Basically, raising the price just before the papers are signed and the deal is delivered.”  -Investopedia

This is the exact opposite of our word a couple weeks back, Gazunder, which is when the buyer lowers their bid after a verbal agreement due to lowering market values.

Five Points to Ponder:
1. European Central Bank rates now at 2.5 per cent.  Bank of England, 2 per cent.  The US, 1 per cent.  Japan, 0.3 per cent.
2. The Dow tempting 8000 again.  S&P 500 down 44pts.  Nasdaq down 62pts.  Unemployment rises to 6.7%.  Oil is down to $42!
3.  Mortgage rates down huge over the last two weeks.  The Government discusses fixed interest rates for homebuyers to stimulate demand.  Foreclosures up 76% over last year.  Delinquencies up big.
4. The Auto industry continued its doom and gloom talk in hopes of wrestling Congress into a decision.  Meanwhile all auto companies, US and International, down big percentages on car sales for the year.
5. BCS shows cracks.  Computers determine fate.  Florida, Alabama, USC, Oklahoma.  Who’s going to be in the big dance?  Great games this weekend.  UCSB Men’s Basketball take on Gonzaga Sunday!  Go Gauchos!  U of Washington to name Steve Sarkisian their new football head coach.

Positives:
* Merrill expects oil to drop to $25/bbl.  Welcome gas prices back to the $1 figures.
* 4.6 million supply of homes nationwide.  4.5% home buyer interest rates would be expected to spur 500,000 in purchases and cost the government $50m.
* Low interest rates means the governments are infusing these economies with money.  If they do it quickly enough, they will prevent a Japanese deflation crisis of the 90s.  Inflation, due to increased unemployment and limited demand, is no longer a huge concern.
* UCSB has a great opportunity to claim the spotlight in beating Gonzaga.  Gonzaga has proven their greatness this year, however they are always fallible as my Santa Clara Broncos continue to prove!

Negatives:
* There is very little room for the Fed to drop rates in aiding the economy forward.
* Millions are losing their jobs.  Newly graduates with law and MBA degrees can’t find jobs.  Well qualified individuals have lost their job for no reason attributable to their worth.  A product of their time.  The good news: Entrepreneurs are created in economic downturns.
* USC will be left on the outside looking in for the National Title.

Services: Spanish Speaking
For those of you that don’t Habla Espanol, not to worry.  I speak Spanish.  I am capable of helping your friends that prefer speaking Spanish when discussing their home mortgage, preparing to purchase a home, or need a translator in financial assistance.

Local:
Holiday Parades: Streets to the Ocean
Where: State Street Tonight.  The Wharf Sunday night.
When: 6:30pm State Street.  5:30pm The Wharf.
Cost: $0
Why: Get into the holiday spirit.

Live and Be Well,

Jeff Bochsler