Big Government Spending Pushes Stocks and Mortgage Rates Higher

The Obamanomicians are trying to counter the force of gravity and a number of other scientific rules. For every action there is a reaction. The Fed and Treasury have given injected billions into the economy and it's been the kind of push that energized the stock markets and stimulated buying on credit. It's hard to be entirely thrilled by the stock market performance (though we thank God and Obama (one and the same) for little things)at the sub 1000 level. I'll make my bows to Obama if the S @ P gets to 1250 where the losses would be less devastating.

To further stimulate the housing market, the Fed has pursued a policy of buying up vast quantities of Treasury bonds to keep interest rates down. Inevitably, the rising yield curves and low prices is having the opposite effect. Home mortgage rates are rising, and could choke off any small signs of recovery. The "green shoots" may wither and die as rate inflation takes hold even as oil prices climb.

There's no doubt we're in a high interest rate la-la land of the future. Perhaps we can sell our older teenagers and college graduates into slavery to make up the difference in dollar strength.

Unfortunately, we're still in Government Ownership Mode and the spending will continue as we guide GM and Chrysler through their bankruptcies. Somehow the jobs of 50,000 UAW workers have become more important than the other 6 million unemployed.