While interest rates are currently low, the policies coming out of D.C. all point toward an increase in taxes for business, especially struggling small business, many of whom are hanging on by their fingernails.

Add to that the ever-climbing unemployment numbers and I think the future trends could most certainly be downside.

To stop this spiral downward, a friend is trying to get some stimulus money set aside for a 40-year, 4% home mortgage plan (4-40 For Freedom). It will help keep people in their homes who can qualify. It will also help eliminate the estimated 7-9 year supply of used homes on the market as people turn to real estate for long-term investing. The multiplier effect of this program will put hundreds of billions back into the economy at a time when it is sorely needed. Right now, it is the only stimulus plan that injects cash right into the economy to help the taxpayer.

Home real estate drives this economy. Until the Congress resolves this issue, the economy is in free fall.

The amount of wealth that will be lost in higher-end homes alone if nothing is done amounts to billions in the Phoenix market alone. That capital will be lost for business formation and employment opportunities forever.

The next 9 weeks will be fascinating. I think the irrational exuberance can only continue for another week from now. Thereafter:
1 Market goes bizarre or spiky up or down from Tuesday 22nd September.
2 Serious imbalances occur either way on afternoon of Friday 25th September and Monday 28th September. Most likely a correction downwards.
3 The coup de grace on Friday 23rd October and Monday 26th October. A free fall ensues. The bulls fall off their ledge.
4 New low on 18th November. Blood on the floor. All bulls are dead. Time to get into the market. Worst case scenario: the down continues into December, but I personally think it very unlikely.

Enjoy!