January 24, 2008 - Other than buying a $20 pooper scooper and putting it to use today, nothing spectacular happened. I was a bit surprised when I heard that my cousin Mike hadn't even heard rumors about the impending federal tax relief being proposed by the president. Basically, the government thinks that pumping $150 billion into the economy through checks mailed to just about everyone will stave off a recession. I have two thoughts on this. First, let's not call it federal tax relief, let's call it the "everyone in America gets a flat screen" plan, since that's what it is really going to be. When all of a sudden every family in America gets a check for $1200 - $1800, you can bet the ones who don't have a flat screen already are going to march down to Best Buy and pick out the biggest one they can fit on the wall. Sure, a few people will save the money in the bank, others will pay off credit card debt, but most people will have a new flat screen. I hope the stores stock up their inventory as this demand spikes. My second thought on this, "this" being the cause of the need for federal tax relief, is that the Federal Reserve Chairman was basically the sole cause of the sub-prime mortgage write downs that are destroying the world stock markets right now. Every company with ties to banking has been writing off $1 billion to $15 billion this past fiscal quarter. They're doing that because of a chain reaction. A few years ago, predatory mortgage brokers (predatory in the sense that they were concerned with making the most money themselves during the real estate boom, not with ensuring that qualified buyers were getting approved for loans, just ensuring that as many people as possible got approved for loans) set up a record number of people with what is essentially a non-locked interest rate on their first and second mortgages. These loans had low (we'll say around 4 or 5%) rates, which were good for only a few years, and then the rate would reset to the "prime" rate (or some prime +1 or similar rate). So while all these happy people (the brokers, who got mega commissions from record sales, and homeowners who think heir $40k a year income can afford a $350k house) are going about their business, the Chairman of the fed is progressively upping the interest rates to deal with inflation. Well, here we are, with all these loans resetting from 4% to 7%, and suddenly the banks stop receiving checks in the mail from the homeowners, since they can't really afford to pay an extra $500 a month on their mortgage. So at the expense of staving off inflation (which would be a fairly mild economic problem), the Chairman has created a banking crisis so bad that it has caused MASSIVE drops in stock prices, MASSIVE amounts of homes going into foreclosure, a real estate decline not seen for over 30 years, and general UNCERTAINTY and FEAR over the future of the US and world economies. But I guess it doesn't matter so much since I'm going to be getting a free flat screen TV in a few months.