Thinking about 2008 By Fred Cederholm

Column for on/after December 30th, 2007

I’ve been thinking about 2008. Actually I’ve been thinking about forensics, the 2008 elections, the debt/ deficits, dollar prices, energy, food, and “common” sense. 2008 will be a year for the record books and I don’t mean this in any positive way. We are in one big mess on so many fronts. There are so many glitches in the systems set up to contain the problems that negatively impact our way of life. The patches/ fixes, both in place and proposed, have NOT become solutions - they enhance our problems.

You see in 2008 the word “forensics” will become the buzzword of ultimate importance. It will be used in ever increasing contexts – or at least it should. Forensic investigations will prove central to forensic medicine, forensic accountancy, forensic journalism, and forensic economics. True solutions/ fixes only can come from a real understanding of the facts and the truth. Varnishing or sweeping our problems under the rug via spin, hype, and propagandized distractions have never solved anything.

“Forensic” comes from the Latin forensic meaning forum, or rather “putting before the forum.” Any rational decision, or solution, requires an honest presentation of the facts (and the evidence) behind what has transpired. Forensics involves chronicling and preserving evidence, analyzing that evidence, and presenting the finding to (the court of) public opinion. Spinning, hyping, and out-and-out lying have only made our problems/ dilemmas worse. Errors have been made. Yes… even crimes were committed. The only hope of turning things around will involve owning up to our mistakes, prosecuting the criminal acts, and proactively making the hard decisions to return to those paths which made this country strong.

All elections are important, but the 2008 elections are a make-or-break for this nation. The 2008 elections will dominate the news and the media coverage. It seems like they have already gone on for an eternity. But thus far… just what have the lions’ share of the campaigns revealed to “We the people…” regarding the issues/ problems facing US/ us as a nation? What do we know about the candidates and their stands on those true issues? What are their platforms/ plans to facilitate a turn around? How is their agenda any different than the same-old, same old that got us to where we now find ourselves? A forensic analysis of the Democans and the Republicrats show them as Siamese twins joined at the “and spend!”

As 2007 wound to a close, our national debt stood at $9.125 TRILLION. Over $4 TRILLION of which were surpluses paid into Social Security and other retirement trust funds under the custody of our Federal Government. These were categorically (and systematically) raided by Uncle $ugar and spent elsewhere. In the twilight hours of Congress in 2007, our elected officials passed a $550 BILLION omnibus (meaning all-inclusive plus the kitchen sink) spending bill. Appropriations for the defense/ war/ security funding garnered the headlines, but the bulk of monies in that all-inclusive bill went to PORK PROJECTS which have been dubbed “earmarks.” These are nothing more than a financially disastrous attempt to show that the incumbent mamas and papas are “bringing home the bacon” and should be returned to office come November. When I started writing this weekly column some four years ago, we required a daily infusion of a billion dollars of new foreign investment capital. Now it is 3 times THAT!

Explosion of our debts and deficits have taken a toll on the dollar. The US Treasury and Federal Reserve Bank’s solution is to create more liquidity by printing more money and lowering interest rates. This will only exacerbate the problem; the dollar will further decline and inflation will soar. We will end up paying more for our (imported) energy and our food in 2008 because our dollars will only buy less. (Don’t expect to see the coming 20% to 25% jump in what we pay for energy and food to be reflected in the reported inflation rate(s). Energy and food are conveniently EXCLUDED from “core inflation!”)

I resolve to chronicle the forensic evidence behind these matters (and so many others) for my readers to consider in 2008. Rational thought and common sense can only prevail when (the court of) public opinion has the unvarnished truth and the un-spun/ un-hyped facts to evaluate. I wish you all a very pensive 2008. I’m Fred Cederholm and I’ve been thinking. You should be thinking, too.

Copyright 2008 Questions, Inc. All rights reserved.

Thinking about renewal By Fred Cederholm

Column for on/after December 23rd, 2007

I’ve been thinking about renewal. Actually I’ve been thinking about Christmas, advent, cards/newsletters, “It’s a Wonderful Life,” our service men and women, and happiness. The Christmas holiday is something that actually invigorates me. Sure there is so much going on in a very compacted period that the “honest” appraisal/effect of the season should be one of exhaustion, not of renewal. I also experience the “you gotta’s!” Gotta do this, gotta attend that, gotta touch base with …; but after I collapse in my bed at night from doing “whatever” and before I fall asleep, I TH*NK about how blessed I am and how the Christmas season puts things in perspective for me in such a positive way.

You see despite the fact that Christmas falls at the end of the calendar year; it is really a time of beginnings and renewals. It celebrates the advent, or beginning of the Christian church year. For those of us of the Christian faith, it marks the prophesy of the Old Testament fulfilled. It celebrates the birth of the promised one. It is a time of tidings of great joy, peace on Earth, and goodwill to man. Cynics may decry the commercialism, the rat races, and the negative perceptions with a loud BAH HUMBUG; but such ill-conceived perceptions rob them of the cleansing benefits of the true “reason for the season.”

Each day I’ve been receiving cards and newsletters from family, friends, and acquaintances – many of whom I only hear from at Christmas. I don’t hold this absence of communications against them. How can I? I am just as guilty of not keeping in touch as they are! The Christmas exchanges fill in many of the blanks from the past 12 months. This is a big part of the renewal process for me. If the Christmas season forces the contact, fine, I’m so grateful to be remembered in the yuletide sharing of what’s been going on in their lives. Hopefully they feel the same about my updates.

The Christmas Sunday School program at my little home church of St Johns usually kindles the holiday spirit in me. Seeing the little folks singing and reciting their Christmas pieces brings back so many wonderful memories. The sanctuary decorated with poinsettias and a large tree covered with symbolic Christmons is always so festive. Our special Christmas Eve candlelight service with carols and communion helps to set the mood for me because, in keeping with my family tradition, I decorate my tree when I return home. Now… the household consists of puppy and me, but we still have a tree just for us. This year I spent the Saturday before Christmas with my cousins’ families in Naperville and spent Christmas Day with my sole living aunt and uncle at the home of my cousin Donna and her husband Robert. At both gatherings we will pass around the photo albums and lovingly discuss those departed.

It wouldn’t be Christmas without re-re-re-enjoying the viewing of the Frank Capra classic “It’s a Wonderful Life.” I’ve already watched it twice this season. Although I’ve seen it dozens of times, this year it took on special meaning as I thought about the looming Real Estate crisis with all the pending foreclosures. While there are scores of contemporary villains I could easily cast as the evil banker, Henry F. Potter, only one contemporary person (a candidate for US President in 2008) comes to mind for the role of the hopeful George Bailey. We need a George Bailey to work a Christmas miracle for us!

As I shared the holiday gatherings with family and friends, I thought about those absent this year. I know of several local families with loved ones serving around the globe in the military. All across this nation there are literally hundreds of thousands of households with voids and vacancies around their trees and holiday table feasts. Take a moment to reflect on them in your gatherings. Pacem in Terris.

It is often said that one never fully appreciates what they have… until it’s gone. That maybe true, but during Christmas 2007 please make the effort to tell those you love how you truly feel about them - you won’t be sorry. Remember that real happiness comes from wanting (and appreciating) what you already have! I’m Fred Cederholm and I’ve been thinking. You should be thinking, too.

Copyright 2007 Questions, Inc. All rights reserved.

Credit Crunch success requires lower Dollar By Greg Silberman

How worried should we be? Gold stocks and the stock market continue bleeding. Not a day goes by without fresh cash being injected by some central bank somewhere. Where can we invest a) safely and b) to profit from the volatility?

Let’s see?

• We’ve had Treasury Secretary Henry Paulson’s plan to freeze interest rates on a limited number of "teaser" subprime loans for 5 years.

• We’ve had the Fed, ECB, Canada and Swiss Central Banks making money available via forex swap lines.

• Rate cuts in the US, Canada and England to stimulate borrowing.

• We’ve had a $40 billion Fed ‘auction’ to lend banks money.

• And this week we had the ECB make an unprecedented E350 Billion available to help 390 private sector banks with year-end rollovers.

Money is raining from the sky and it’s no drizzle, it’s a veritable flood. Yet the credit problems persist. What’s going wrong?

more
http://blog.goldandoilstocks.com/2007/12/credit-crunch-success-requires-lower.html

Thinking about sovereigns By Fred Cederholm

Column for on/after December 16th, 2007

I’ve been thinking about sovereigns. Actually I’ve been thinking about Britannia, power and clout, heading East, the housing bubble, national investment funds, the Swiss, and “money bombs.” In 1816 the gold British Sovereign was first introduced. As the British Empire expanded under Queen Victoria during the 19^th Century, this nickel-sized mintage became the world’s most widely distributed gold coin. It is still hoarded and sought as an investment, a store of value and a hedge against inflation.

You see sovereignty is about power and clout. If you are sovereign: you can pretty much do what you want, when you want it, and how you want it. You are respected. You are accepted. And yes… you are even feared! There is clearly a hybrid form of the “Golden Rule” at work here: “he who has the gold, sets the rules.” The sun has set on the British Empire as hegemony, power, and clout shifted eastward. The United States became the dominant military and economic force on the planet and with the break up of the former Soviet Union, it became the world’s sole remaining superpower. Now… the status of this American juggernaut is under scrutiny. The US has gone from the world’s largest creditor to the world’s largest debtor requiring a DAILY infusion of $3 BILLION in foreign capital to fund its deficits and wars.

Last week saw the US FED cutting interest rates by an additional quarter point to stave off further financial calamity. It also saw the “creation” of an additional $64 BILLION in magical fiat “paper” liquidity. These will not remedy anything, because the inherent crisis/ problem is NOT about liquidity, it is about solvency. If you are solvent, you have the where-with-all to pay your bills and service your debts. More liquidity encourages assuming more debt, not paying down already existing obligations!

It recent years, we have seen the development/ evolution of a new type of financial juggernaut – the Sovereign (Trust) Funds. As the debt-financed consumptive addiction shifts the concentrations of wealth from West to East (and the Middle East), twenty-eight nation states have set up investment funds to channel their new wealth into global investments for the future benefit of their native citizenry. The amounts behind these funds now number $3 TRILLION. These are projected to grow to $10 TRILLION by 2012. The 30 year old Abu Dhabi Investment Authority is the largest - sitting on $1.3 trillion. This equates to $1.5 MILLION of assets for each and every one of its citizens. In the alternative… consider the United States where a national debt approaching $10 TRILLION equates to over $30,000 of debt for each and every one of its citizens! These trusts have the ability to snap up huge bargains as further money crises unfold.

The Swiss were known for neutrality, chocolates, and their world-class banking industry. Last week, the deflating housing bubble once again took its toll; this time on them. After their first write-off of $3.4 BILLION in Sept 2007 for the 3rd quarter, they took additional $10 BILLION hit in this 4th quarter. Their (UBS) deal with Singapore and some "unnamed Middle Eastern Sovereign fund $ugar daddy" was really an emergency infusion necessitated by a threat of insolvency. Who would have thought the Swiss…? This is the most recent (and largest) of the “money bombs” to threaten the highly vulnerable global banking community. There will be more as this drama unfolds requiring even larger sums of cash.

I’d be remiss if I didn’t comment on events of this past Sunday, when on the 234^th anniversary of the Boston Tea Party, supporters of Presidential candidate Dr. Ron Paul staged their own “money bomb” raising just over $6 MILLION in one 24 hour period. Paul has been a darling of the internet and the famous “meet ups” at campuses and communities all across the nation. The Paul campaign has been deliberately (and totally) ignored by the main stream media in this current run for the White House. That invisibility will clearly cease from now on. I was completely wrong when I wrote TH*NK*NG (PHENOMENON) about Barack Obama a year ago on December 31^st. The real phenomenon in Election 2008 is not Barack Obama, it is Dr. Ron Paul. I’m Fred Cederholm and I’ve been thinking. You should be thinking, too.

Copyright 2007 Questions, Inc. All rights reserved.

The hoax called democracy By Joost van Steenis

Phnom Penh, December 11 2007

Dear reader, this is the 94th Letter of an Autonomous Thinker.

The gap between the incomes of the masses and the happy few at the top is increasing.

Democracy has no answer to the human demand that all people should have equal status.

The greed of the elite is immense.

In young democracies corruption seems to be the most important method to fill the pockets of the already rich and privileged.

According to the Corruption Perception Index the least corruption is found in old Western democracies where democracy has become a legal instrument to channel vast amounts of money to the happy few at the top.

The boss of Citigroup Inc. was awarded with hundred million dollar after he resigned because he was responsible for huge losses caused by the sub-prime crisis.

The CEO of ABNAMRO Bank got thirty million euro after he bungled in the selling of the bank.

A former Dutch prime minister tripled his salary when he became director of a semi-governmental health organisation.

This legal corruption is not included in Corruption Indices.

The greedy grabbers are supported by politicians who are also looking for the Big Money.

Clinton and Blair were well paid as political leaders. Now they have entered the world of the rich. The knowledge, experience and notoriety acquired in a public function is being used for their own benefit. Clinton got two hundred thousand euro for a single lecture, Blair gets millions for writing books about what he did when he was prime-minister. But for that work they were already very well paid in their political jobs.

Just as in the Third World many Western politicians are waiting for the chance to get more money. In contrast to the Third World they make laws that legalise the fulfillment of their greed.

Democracy cannot stop these greedy people.

I never vote, I am against democracy that brings politicians in a powerful position in which they legally enrich themselves and other elitist sectors of society.

The system of elections, the voting in power of greedy people, does not stop the increasing gap between the haves and the have-nots.

It is said that corruption in the Third World is caused by unaccountability, by the fact that the system does not have enough possibilities to control leaders.

In the West is proven that leaders can openly and legally use the democratic system for their own benefit. Any system based on elections only restricts the possibilities of masspeople to control (the greed of) leaders.

Democracy is in the first place introduced to control masspeople who are only allowed to transfer once in a while their voting power to elected people who then decide OVER and not WITH masspeople.

All political action of masspeople can now only take place on the time, the place and the way leaders decide. The people remain dependant.

How can masspeople stop the increasing flow of money to the small group of people at the top?

New direct methods of control have to be introduced that force leaders to behave decently, methods that cannot be controlled by the very people against whom actions are undertaken.

My proposition is simple.

Humanity lives on two worlds, the eliteworld for the happy few and the often harsh massworld for the vast majority.

Now all actions take place in the massworld.

I propose to invade the eliteworld so elitepeople cannot anymore continue to live their egoistic and privileged way of living.

In this process masspeople will acquire a new self-esteem and a New World will come nearer.

But any time spent on elections, even the simple entering of ballot boxes, is wasted time.

Democracy is a hoax, it does not lead to a world in where all people have equal status.

Yours truly, Joost van Steenis

http://members.chello.nl/jsteenis

Ways to increase masspower

Thinking about conditions By Fred Cederholm

Column for on/after December 9th, 2007

I’ve been thinking about conditions. Actually I’ve been thinking about bailouts, freezes on rate resets, speculators, owner occupancy, property equity, current performance, and pregnancy. The RE mortgage bubble continues to pass gas. Billions of write-offs/ write-downs in carrying values have occurred with MEGA-billions more to come. The mass marketing of the derivative paper behind these “pulse loans” (you have a pulse, you got the loan) have made this a global problem because investors worldwide got sucked into the euphoria of these highly questionable “investment” vehicles.

You see last Thursday the President announced a coalition-type plan to “contain” the unwinding of the Sub-prime/ Alternative-A loan debacle. The proposal is being marketed as a non-bailout, where a consortium of players will ultimately bear the heat – and the losses. This is bunk. This attempt to fix the mess will prove to be a half-hearted (make that lame) effort to buy some time before the grim rate re-setter ultimately triumphs. The S & L mess of almost two decades ago cost $500 billion and the deep pockets of Uncle $ugar (make that the taxpayers) footed the bill. This financial Armageddon will eclipse that total and now Uncle not only lacks the deep pockets, I’m not convinced he even has the pants!

This super-hyped plan on the table - which has received worldwide press - proposes to contain the costs by limiting the eligible recipients. The plan proposes to instigate a 5 year freeze on the teaser rates in the effort to slow defaults, foreclosures, and financial misery. This is a good thing in principle as any governmental intervention cannot be all things to all the injured and the aggrieved parties. The conditions proposed make a lot of sense on an individual condition basis, but the big question – after all respective exclusions – is just who is left to reap from the stay of execution, or the pardon?

The first condition requires that the properties be owner occupied. This excludes the speculators who gambled on the faulty premise that property values would continue to rise. Down the pike these real estate investment parcels would be flipped to someone paying an even higher price, the initial mortgage financings would be paid off, and a profit pocketed. Someone else would hold an even bigger mortgage, until they too, flipped the property. This was the daisy chain I saw again and again in the S&L crisis. Estimates under this condition affect some 25% to 30 % of the Sub-prime/ Alternative-A pool of units.

A second condition requires that any eligible property NOT already be in foreclosure. This too is a good criterion. How do you save a sinking ship that is already taking on water and listing to starboard or port? You don’t! We are already seeing the number of foreclosed properties approaching the excesses of the Great Depression. Numbers now vary by geographic market from one in a few hundred to one in thirty! The monthly numbers continue to soar. This will continue as the case despite the plan proposed.

The third requisite mandates that the property have positive equity. This condition should all but eliminate ANY of the Sub-Prime/ Alternative-A properties. The lion’s share of these started out being 100% financed. Many such “loans” financed the closing costs and fees as well – so they started out with negative equity. As this bubble seriously started to unwind - and pass gas - market values dropped. Since the beginnings of 2007 property values have declined 5%, 10%, or 15% across-the-board. In some of the worst markets, the decline already exceeds 20% for 2007 alone. Now… even if the property was only initially financed at 100%, or the subsequent flurry of the “equity” loans brought the property to 100% financed, the subsequent drop in market value made the parcel “up-side-down” and thus not eligible!

If you add that the current payment status be “performing” - with no history of late payments on the property’s ledger - to the aforementioned conditions and criteria; just how many players will be still eligible to partake of the 5 year rate freeze? Let me put it this way… just how many guys do you know can become pregnant? I’m Fred Cederholm and I’ve been thinking. You should be thinking, too.

Copyright 2007 Questions, Inc. All rights reserved.

From Fear to Horror By the BigFisherman

Dec 7, 2007

Copyright c 2007. Rodney C Cook. All rights reserved.

With the bi-polar behavior of the financial markets these past few months, it is sometimes best to remember back to when the unfolding of current events was seen only by the heretics. It is at this point in time where they had the least biased view of the history now being made. These mavens were few, and the ramifications of their insight were but distant theory. And perhaps only they properly recognize the extent of the horror now confronting those trapped inside the nanny-state bubble. Cooing pundits and those that soften the hard edges are not to be trusted.

The attempt over the past few months to herd the sheep into a coral of mortgages by the three amigos heading the Fed, the Treasury, and Fannie Mae is pathetic. It is hard to imagine that I once thought that the monetization of mortgages would hold the line on the empire of the dollar for several years. Perhaps I expected the monetary authorities would have more control than it now appears. But the dollar and housing will stabilize at much lower levels to the debtor’s continued detriment and to the public’s growing dismay.

Already there is much more bleating than I anticipated as the most fearful words a government can utter have been proclaimed: “We are here to help you.” As the housing cover clause is exercised new challenges to personal sovereignty emerge. The competitive advantage given to those who succumb will gnaw away at those who do not. If the credit unwinding is orderly and goes according to plan, a few years of monetization would be sufficient to cause mortal damage to private property ownership. But this great last hope of the neo-Keynesian’s, the housing backed dollar, will fail. Until then this hope is what makes the Keynesians such easy marks.

At the church of Keynes, the Harvard endowment fund got clipped for a few billion. Being no dummy the manager just followed the money. Sir Goldman of Sachs has made a fortune front running the credit deflation, along with the usual inside game on treasuries. The most astute in this camp now understand that historically and fundamentally the financial sector may well contract by an order of magnitude. Most of our financial institutions would go away or be dramatically remade. Goldman intends to stay. They have advised us all to sell our gold because it will go down in price. Fewer listen every day.

Domestically, the libertarian plank for honest money is a concept that is spreading exponentially, well beyond the Ron Paul phenomenon. The confiscatory raid on the Liberty dollar shows institutional fear that foreshadows continued expansion of the domestic market for precious metals as money. The constitutional perspective on lawful money is fast spreading. Will this movement incite withering fire from swelling ranks of hard money investors as the statists are met with contempt and defiance? Or will greater forces abroad take the lead.

Internationally the fiat dollar has become recognized for what it is, and more importantly for what it is not. There may well be an overt global financial assault on the dollar as the US monetary policy of reflate and default has become widely recognized and will be refuted as a matter of necessity. At the very least the dollar will continue to be increasingly shunned. At the worst it will be the focus of historic financial scorn and ridicule, seared into the world’s collective memory for centuries .

So I still expect the demise of the debt based dollar to be inevitable, and while those mavens who saw this coming in detail expect it to have begun in earnest, they also expect it to take an agonizing few years. The dislocations caused by excess credit as money will take some time to unwind even at the intensity exhibited of late. It will be over when demand for dollar debt ends. Hard asset based mediums of exchange will prevail in one of the largest transfers of wealth in history. The savvy libertarian minded around the world will continue to be the primary recipients of this life changing wealth and their ranks will swell as the monetary wisdom of the ages prevails. To the framers of our constitution this was common knowledge. As the cycle of man now requires, it will be so again.

Rodney C. Cook, Ph.D.

Dr. Cook manages Bull Trout Capital, a boutique investment company specializing in precious metals and strategic materials. For the past five years he has authored the private newsletter the FishWrapper on Austrian and long cycle investment strategies where he has demonstrated well over a 65% annualized return on his personal investments in the public share markets.

Subscription inquiries may be sent to big_fisherman@earthlink.net.

Thinking about revenues By Fred Cederholm

Column for on/after December 2^nd, 2007,

I’ve been thinking about revenues. Actually I’ve been thinking about “V.C.’s” questions, the housing debacle, governmental units, taxation, financial institutions, property assessments, timing, and lags. I frequently hear from those who read my columns in print and on-line. Last week’s TH*NK*NG (mone-TERROR-ism) prompted an on-line reader (V.C.) to ask two questions: First, as housing market prices head South and mortgage problems become foreclosures, how do State and Federal governments feel the consequences? Second, will serious credit problems stop the ability to sustain warfare abroad – will our country’s security therefore be affected? Sometimes the dialogues just lead to another column.

You see V.C.s concerns have real merit and got me TH*NK*NG and researching. The tentative conclusions prove NOT to be what one might expect. I’ll address the second inquiry first. Our national government has NEVER let annual revenue determine our foreign policy, our security, or the length of wars. Shortfalls in cash flow are met via borrowing. Analyzing the historical growth of the national debt, you find that it surges in times of war, and stays there. Presently, costs of the Civil War, the Spanish American War, World Wars I and II, Korea, Vietnam, Desert Storm, Afghanistan and Iraq are still there!

Currently the Federal government reaps about 40% of its annual revenue from individual income taxes. Only 10% comes from corporate income taxes. A third comes from payroll taxes (mostly Social Security assessments) – the $200 plus BILLION annual surplus raised is spent elsewhere. 12% comes from other sundry taxes and sources. Roughly the additional 25% of expenditure excess over revenue (including the interest expense) is “funded” by increasing Uncle $ugar’s outstanding debt. The lion’s share of a state’s revenue comes from sales taxes and for most states, it also comes from income taxes.

Financial institutions “contributions” to State and Federal coffers would fall under the corporate income tax categories. You would probably be surprised what a small portion this actually is. Most such institutions receive their largest revenue from service charges and fees - not from their interest spread. Their bottom-line taxable income (after they determine the level necessary to fund dividends to their shareholders - which is a post-taxable income expense) is pretty much up to their discretion. They are blessed with being able to legally manipulate their income via discretionary bonuses and profit sharing expenses to executives and employees. Then too, the ability to book a discretionary annual provision for “perceived” loan losses is a huge tax planning advantage for them. Having a parent holding company, which may file a consolidated tax return, proves an even bigger plus. The list goes on and on.

The present catastrophe of declining real estate market values has almost no impact for now. True, the housing bubble created roughly two-thirds of new jobs in the past ten years. Any “correction” in this sector will impact individual income taxes paid in the future to Uncle $ugar and the states – a real estate re- valuation will not! A decline in market values could impact future revenue proceeds for county governments, local governments, school districts, fire districts, library districts and park districts; but even THAT is both doubtful and highly questionable. Please read on.

Property taxes to be paid in the coming period are based upon the prior year’s assessments and valuations. That is, the 2008 payments are for calendar/fiscal 2007. In Ogle County, Illinois, we just had our most recent quadrennial (4 year) assessment in October 2007. The increased assessments were published in the paper AND notices were mailed to every property owner. You had 30 days to file your protest and question the re-evaluation to seek a re-adjustment. This locked in the valuation for 2008 - to be paid in 2009! It is unheard of for ANY County Assessor’s Office to issue a blanket (across-the-board) change based upon a downward shift in market, or sales, values. The onus is on the property owner to file for any re-evaluation. I’m Fred Cederholm and I’ve been thinking. You should be thinking, too.

Copyright 2007 Questions, Inc. All rights reserved.

APPENDAGE:

Dear Mr. Cederholm,

I've been reading your articles through financialsense.com and I have liked them very much, they are not the usual Reuters / Bloomberg stories, I learn a lot from them.

I would like to pose two questions; I have been reading about the current credit crisis (to call it somehow) but I have not come across the following:

1) As house mkt prices go south, so go the taxes that US government collects. Also when there is a foreclosure and the Bank gets the property back, probably they do pay less taxes. So shall this mortgage problem start to spread nationally, how would the State and Federal Goverment feel the consequences? And all this while the Fed is lending all the money they can create on their computers?

2) Shall there be a serius credit problem, even for the US Government, one unwanted consequence will be to stop the ability to sustain warfare overseas; and that is an issue of Country Security which is much more worrisome than some poor people having to sleep on the streets because they lost their home, isnt it?

Thank you in advance for your time and please, keep on thinking!!

Rgds, "V.C."