According to the New York Times, “A growing number of the people whose homes are in foreclosure are refusing to slink away in shame.” They are just refusing to make their mortgage payments but continue to live in their home until the bank evicts them. LPS Applied Analytics says the average borrower in foreclosure “has been delinquent for 438 days before actually being evicted.” This means that the homeowner essentially lives rent-free for nearly 15 months, and can use his mortgage payment to make other payments such as car loans and credit cards.
The Obama administration is pushing for a second “stimulus” package as the amount of money flowing in the U.S. economy contracts at a pace not seen since the Great Depression, according to international news reports.
After six straight months of gains in consumer spending the April numbers showed no change from March, according to the Commerce Department. This was a surprise to some who have been tracking such things as the University of Michigan’s index of consumer confidence (higher), consumers’ expectations on the economy over the next 12 months (higher), moderate real job creation (higher), savings rate (higher) and manufacturing activity (higher).
“Paychecks from private business shrank to their smallest share of personal income in U.S. history during the first quarter of this year,” according to USA Today. “At the same time,” continues the paper, “government-provided benefits — from Social Security, unemployment insurance, food stamps and other programs — rose to a record high during the first three months of 2010.” This reflects, says USA Today, “a major shift in the source of personal income from private wages to government programs.”
The timing of the sellout by Senator Bernie Sanders (I-Vt.) could not have been more politically auspicious — or more suspicious. For months the Senator had been denouncing the secrecy of the Federal Reserve’s bailout operations, which have exceeded two trillion dollars. For months he had been pledging that he would push for a genuine audit of the Fed. He authored an amendment in the Senate identical to “Audit the Fed” legislation in the House (H.R. 1207) authored by Congressman Ron Paul (R-Texas).