Let’s start 2013 with a little sarcasm if I may…
It never fails, Congress comes up with a deal at the last
minute (actually after the last minute) to stave off market self
destruction. As you know the Fiscal
Cliff has been temporarily averted. Congress
was able to piece together a deal that was just enough to keep the markets from
panicking, but comes nowhere close to solving our country’s fiscal dilemma.
Congress passed the new budget which increases taxes on an
estimated 77% of the taxpayers in this country.
As a tax paying citizen of the United States I am not necessarily
opposed to the increase, whatever it may be, however my issue is that once
again our government has increased taxes but they have done
nothing…zero…zilch…nada to reduce our nation’s debt or curtail spending.
In fact the irony of this temporary deal is that a good
portion of the tax increase will not go towards deficit reduction, it is going
to more increases in spending. To make
matters worse is that the government has already committed to more spending
increases than revenue increases. Bottom
line we are going to continue to go further and further into debt. (Wasn’t this whole long drawn out battle in
government about increasing taxes and reducing spending?)
My recommendation to you is get yourself a good accountant
to save on as much income tax as you possibly can because it is obvious our
government is going to keep reaching into our pockets more and more without
ever doing anything to reduce our spending.
(Gee wiz…don’t we seem to be
heading down the same path as Europe? We
all know how well that has turned out right?)
I almost forgot to mention that Congress has given
themselves two months to address deficit reduction and come to an agreement on
how it will be done. My suggestion, go
to Vegas and lay down your bet on the odds that they WON’T get it done in two
months. If they couldn’t do it in two
years, what makes you think two more months will make a difference?
In other news that no one seems to be paying attention to
except mortgage professionals, real estate professionals, home buyers and home
owners, mortgage rates are rising. In
just 3 days since the budget deal was passed mortgage rates have risen every
single day. Despite the government’s
efforts to keep interest rates down, investors have more control over the
direction of rates than anyone else. Rates
are still incredibly low however you should expect that the trend of rising
rates is likely to continue. In fact the
Fed just the other day reported that they are not expecting rates to come back
to the historic lows again.
Now is the time torefinance or purchase a home because the odds on the cost of borrowing money
along with house price increases is more likely now that we have seen in the
past 4 years.
JJ Mack
916-517-1800
jj.mack@apmortgage.com
www.apmcroseville.com
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