Foreclosures and interest rates

Foreclosure rates continue to climb, interest rates continue to remain low. For the few people with some money and the security of a good job this represents opportunity, although with some level of caution since housing prices continue to decline also. What to do? If you buy something there is the risk that the "something", whether stock, real estate, or anything else will decline in value. If you don't buy anything there is the absolute certainty that the value of your dollars is going to shrink. Helps explain the rise in gold prices. Each little bit of news that seems to offer some reassurance is touted as a return to normalcy, by government types and financial gurus alike, but until the administration and the Congress reverse their policies of increasing debt burden and the tax load on business, nothing is going to improve. Until government gets out of the way of free market forces nothing is going to improve. No sane businessman is going to invest his money in expansion or the hiring of people unless and until there is some certainty the government is not going to intrude further on their activities.
In the home mortgage market, the holders of mortgage paper are faced with the uncertainty of future government actions and so don't know for sure whether to keep loans on their books as under-performing, or foreclose for a certain loss. The bad loans made during the ridiculous sub-prime fiasco are being joined by a whole bunch of new underwriting errors through the auspices of FHA mistakes, and because of the economic downturn and unemployment increases, an increasing number of "A" paper loans are also going sour.
On the subject of FHA, even after the disaster of " no money down" financing for people with damaged credit pushed by FannieMae and FreddieMac (Frank and Dodd), along comes the FHA offering home loans to people with FICO scores in the 500's with as little as 3% down, and with some "wiggle room" even for the 3%. The last two years have produced enough bad loans that the delinquency rate is approximately 25% already, and surely with more and worse to come. This sort of government tampering with market forces creates another level of uncertainty as to the value of homes. How many more homes are going to come on the market under distress circumstances? How do you know how to value your home? How do you know how to value a potential purchase? Until some sanity arrives in Washington we are all like a feather in the wind. Debt in the trillions already and an insatiable appetite for more. Health care reform, cap and trade, bail-outs, stimulus, and who knows what else. No centrally planned economy has ever been successful, and never will be. The lessons that should have been learned from the past have already been forgotten, or worse still, ignored. It would be easier to train a chimpanzee to sing opera than to teach a politician the fundamentals of business. When people with zero experience run for public office we should ignore them, not elect them. How's that "hope and change" working out for you? The "change" is killing me, and I "hope" it stops soon.
As usual,
Thanks for visiting.