Money Matters Airs Tomorrow at noon. Dividend Payer doubles. Update August 25, 2010

Marc's Notes:

Sales of U.S. new homes unexpectedly dropped in July to the lowest level on record, signaling that even with cheaper prices and reduced borrowing costs the housing market is retreating. Purchases fell 12 percent from June to an annual pace of 276,000, the weakest since data began in 1963, figures from the Commerce Department showed today in Washington. The median price of $204,000 was the lowest since late 2003. Bloomberg. August 25 2010

Marc’s Notes:
New home sales follows yesterdays existing home sales to new depths. Note these sales are the lowest since records began in 1963. When I said you watch July-August home sales, I wasn’t kidding. Pricing of homes was no better at a median price matching home prices of 2003. To fully correct, home prices will probably end up near mid 1990 levels many years from now. I know, I’m crazy again right? HA! You wait, “You ain”t seen nuthin yet!” Prove me wrong if you dare!

And have you seen interest rates? Wow. The interest rates are PLUMMETING to all time lows, EVER ! This is smelling like my show # 55, “The Biggest Bubble” where I chronicle the baddest, biggest and final bubble in the making, the US debt bubble! These low interest rates point to JUST THAT. When interest rates plummet it means bond price skyrocket. They are opposite of each other. The supply is massive, everyone is piling into them, money is being lent to buy them, no one thinks they can lose money in them, and the price is skyrocketing.  Sound familiar? Think housing before the crash.
Its BUBBLE time! Just like show #55 detailed over a year ago. What does this mean? Big trouble that’s what. These bubbles can go on much longer then anyone expects and to ridiculous extremes before they pop. Think housing again!
What does a bubble in US debt mean? Like housing, when the bubble pops the prices will plummet as everyone tries to get out at once. This will skyrocket interest rates, and since the FEDS have no ammo but issuing debt, it will be shooting blanks. It won’t be able to finance itself OR print anymore unless it wants to risk HYPERINFLATION.
What’s next? Tune in tomorrow at noon PST to KVMR FM for the answer!
All for now,
Marc

NOTE: Dividend stock update. BIOVAIL (BVF) on our list doubled from our buy in and no longer pays the rate we like so anyone who owns it should be looking at least a 50 % gain in the stock price plus what it paid us and long time dividend payers should have made even more. You should now be OUT of Biovail BVF.  Nice run there~ See this chart.

http://finance.yahoo.com/echarts?s=BVF+Interactive#chart2:symbol=bvf;range=2y;indicator=volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined