Daytime TV Rots Your Brain

The Fed reduced the benchmark interest rate, a move to side-step a possible recession. Reducing the rate allows more money back into circulation by encouraging borrowing. The reason to not reduce this rate is that reducing this rate encourages stock market speculators.

Alas, this may help stock market speculators, but real estate speculators are still up that famous creek without their paddle. Mortgage loans are long-term products. If you are mired in an adjustable-rate or interest-only product, you are still mired in it. If you are developing a property for resale, that timeline is still long and those buyers are still skittish. Nothing has changed there.

Now the TV part: As soon as a window is open for speculation, offers on how to borrow to speculate pop up on TV. This afternoon, while at the gym, I spotted a commercial offering to invest your home equity into the stock market. Uggh! In June, I remarked how daytime TV offered quick-fix remedies to your financial woes. These ads are seductive, but if you listen to those ads, you risk a visit from “the repo man.” Well, here we go again.

Plus ça change, plus c'est la même chose
The more things change, the more they stay the same.