I’ve been feeling nervous this week. I’m normally not the nervous type, but the need for a bailout and the house shutting the bailout bill down on Monday, had me on edge. The uncertainty and panic in the markets were bad enough, but the big worry was what was going to happen next? I spoke with a banker friend and he said they hadn’t cut back on their lending, but he was feeling uneasy, too. I called a couple I’ve been working with who were all set to make an offer on a home, and they said they’d changed their minds. With the economy as uncertain as it was, they felt safer on the sidelines.
Over the last week I’ve spent more time online, reading financial and economics blogs and trying to get an idea of what this bailout would mean to the economy, and the mortgage and housing market. The concensus was that no one really knows. Some thought this would make things worse, others thought this would be the spark needed to get the credit markets moving again. Either way, unemployment is rising so it will take a while before we get through this.
Besides spending more time online, worrying, I had more conversations with coworkers who were also worried. It’s nicer if you can worry in a group. It feels better than worrying alone and the conversation helps you pass the time. With all my time spent talking with coworkers and reading about what might or might not happen, I wasn’t getting as much done as I normally do. I also wasn’t making as many follow up calls because it was clear to me that if I was nervous, everyone was nervous, and so it wasn’t worth the effort.
But not everyone got the message. I was still getting calls and emails from prospects looking for a refinance or a mortgage pre-approval. In fact, I had about the same new prospects and as many new meetings as I have been averaging over the last month. Talking with a prospective first time home buyer today, he said he had been thinking about buying this Spring, but with home prices down like they are, he doesn’t see the sense in waiting.
I’m still not sure how all of this is going to turn out, but I’m going to try my best to relax and take it as it comes. There is not much I can do to change the over all economy, but there will still be people who want to buy new homes and home owners who want better terms on their mortgages. If I don’t sabotage myself with worry, I know that I will get my share.
Well, it’ll take them some time to chew on that $700 billion, so I’d say you get about a couple of months to forget the worry, what with the elections and all. Early next year, the bottom caves out, and won’t be any bailout coming then.
If only we had a crystal ball…. The good thing is that whatever happens, something will happen. in other words even if things go to pot (which they still may even after the bailout) at least that will correct the market and you can bet that tighter regulation will be a result. it may be painful and take 10 years to recover from but we will survive! on the other hand this bailout might work, we might get better regulation now and we can all move on. Either way the problem will get fixed.
Chad C.
It definitely is a frightening time, and I think everyone’s a little scared — especially people who are nearing retirement. I’m not sure I agree with the bailout, but I think something was needed to calm the panic. If nothing was done, fear would get out of control and people would really start making unwise decisions, like yanking all their money from their bank accounts or selling all their stocks, and then things would get really bad. This may seem like a waste of taxpayer money, and may not make things “better,” but I do think it will prevent things from getting much worse.
Mass hysteria is controlling the markets and the “worrying” that is overcoming the masses is part of the problem. I see it everyday, especially when idiots like Suze Orman get on TV and say to take your money out of the markets. Is any wonder we are seeing stocks fall off the deep end with advice like that?
OK, that being said, I think the markets have needed a serious crash for some time and all of these bailouts are only prolonging the inevitable. History shows that government intervention does not help, but rather prolongs the pain and turmoil. I wrote about that over at my own blog a while ago.
Now, my focus is on getting everyone to take a step back, stop listening and worrying about what is happening, get your emotions out of your financial thinking and get it back on to what your strategies should be. I just did a post on the financial crisis, emotions and your money that shows why, if anything, you should probably be putting money into the markets, even if we haven’t hit bottom yet.
Why? Take it out now may be a “buying high, selling low” result and that means plenty of losses, whereas holding what you got and letting it ride will almost guarantee a return over time. And for those looking to buy real estate, refinance, or anything related, as mortgage professionals, we all need to assist those people in making the right choices without letting their emotions, and certainly not our own, disrupt their plans.
It’s getting to the point where I’m asking myself questions like:
- should I move my children’s trust funds?
- should I withdraw my salary from my HBOS account and hold it in cash, just incase the bank goes down?
- are my mortgage company going to double my interest rate to get me to leave?
No question sounds too stupid right now!