Sometimes I Don't Believe in Miracles!

For folks who I know well this post's title might not sound like something I would write - Even out of character for me. Rest assured, I generally DO believe in miracles but not so much in business. Good people make poor business decisions, end up losing large amounts of money, and alas - no event occurs that miraculously saves their financial hide. I have personally witnessed this on several occasions and it is always sad but not so surprising when someone who is over leveraged ends up losing a Gatlinburg area real estate property in foreclosure. With the market's recent doldrums it has too often been real estate practitioners who have been the ones to lose their homes.

My friend Jon Modene is a real estate professional in Perrysburg, OH near Toledo, OH. Like me, he is an endorsed local provider for the Dave Ramsey Organization. This means that we both are against excessive consumer debt - Especially non-producing debt. But it's not just consumers that are struggling under a burden of way too much debt they are attempting to carry. Our federal, state, and local governments all have too much debt which limits their ability to provide services without breaking the budget. In fact, most of the problems that our economy is facing are because of the debt that businesses, government, and private citizens have taken on.

The following is Jon Modene's recent post in his which I was MOST impressed with:

Do You Believe In Miracles?January 23rd, 2009 . by Jon Modene

I don’t.

Not in business. Not in real estate.

I was surprised to see naked, shameless shilling. By two public figures.

Begging for miracles.

The first was Toledo’s mayor,
Carleton Finkbeiner begging for people to please help Toledo and to go buy GM, Ford, and Chrysler automobiles. (What about the Honda’s made in Ohio? Too bad!)

Really? People with unknown employment futures? With too much personal debt? With rising taxes? We need to go out and buy a new car? With OPM? (Other People’s Money)
With car loans?

I have a message for Mayor Finkbeiner- Toledo’s problems stem from TOO MUCH debt. Simply taking on more debt will never help Toledo, its corporations, or its citizens.

Then I heard real estate broker/celeb Barbara Corcoran shilling about 12 houses all around the country on the Today Show with Al Roker. Corcoran opined that with Obama’s inauguration that in real estate “Everyone in my field is feeling really good”! Really?

Oh my.

This is delusional. Amazing. And hard to stomach.

Again, pushing homes on people who cannot afford them - not the recipe for economic revival America needs.

The market needs shillers, politicians, and lawmakers to leave it alone.

Let it work.

Stop goosing lending. Stop incentivizing debt. Stop trying to “fix” the market.

No one can fix the market. Ask the citizens of Iceland. They tried. They are all broke.

Prices will find their own level - honest prices.

Some people will suffer.

Some people will go broke.

Some people will be hurt.

But that is the only way to fix things.

For people with a really strong stomach - please read what always happens when dishonest people with ulterior motives try to sell you something you don’t need and cannot afford -
Michael Lewis’ “End of Wall Street”.

Pass it along. (N.B. Lewis writes with real quotes and strong language - you are thus warned)

These lessons need to be learned - and learned fast.

And the shillers need to be silent.

All except for the part about not believing in miracles I couldn't agree with you more Jon!


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