opportunity with these ultracheap interest rates. terry, let me ask you about a mortgage. is blurring better on the mortgage front if you re a first time home buyer, do you need a 30-year fixed rate mortgage and that s the way to get into this game? absolutely, yes, you do. you lock it in around 3.5% for 30 years, even though you might not want to have that home for 30 years or you might want to pay extra on the mortgage. if down the road because of all the money creation, interest rates rise, will you find other things to do with your extra money but in the meantime, give yourself and your family budget that security of knowing what the rate is. don t go for 2.9 % because it will adjust in a few years. lock it in for 30 years. that s the most important thing as a young person getting started. i think when you look at where rates are today if you re talking about anything adjustable there s only one way for that to adjust, up, up, up. clark and kerry, so nice to see you this morn
investors react, sometimes bad news is good news. bernanke talked about how the economy was running at a low inflation rate and we might need more stimulus, the recovery is very, very slow and additional stimulus is what wall street is looking for. it means that interest rates will be held low and so investors like that the economy is not picking up too much steam too quickly. in terms of people who are looking for jobs, people that are trying to sell their homes, this economic recovery is painfully slow. so for investors and for individuals, we re looking at two sets of data here. let s talk about the housing market. you ve got great news on the mortgage front that mortgage rates will stay slow. if you re trying to buy a house, that s great news or if you re trying to finance, great news. the problem is try going in and getting a loan or try to get in and get a refinance loan. it s really difficult. credit is extremely tight.
them from some of the problems that we had before, notably on the mortgage front. it was a big problem before. mortgage brokers will no longer see the bonuses that actually encourage them to put people in more expensive bad loans. the prepayment penalties are not gone but they re restricted. that s a terrible thing where they give you a lousy loan and then it makes it almost financially impossible for you to get out of it. also, the consumer protection agency, a lot of lobbyists for and against this but bottom line, it is in that bill. it is but we don t know what it is going to do yet. a lot has to do with who runs it. it s interesting, because a lot of problems that this is going to go after have sort of solved themselves already. banks have stopped giving bad loans to people who can t really pay them off because they lost too much money on those loans. so some of these problems have already taken care of themselves. some things will still be out there. elizabeth warren, the ch
the mortgage front? you know, there s a little tiny addendum in there about how mortgage services have to keep 5% of the loans that they do on their own books when they go out and syndicate these loans and do mortgage backed securities, securitize them. they have to keep a 5% chunk on their own books. that s supposed to make them keep skin in the game as warren buffet likes to say so they don t go and make these crazy loans. what it really could do is slow down the process even more. people might pay more money for these loans. it s really going to mess things up. i m not saying we shouldn t do it. i m just saying there could be all kinds of unintended consequences. we won t even know until the law goes into effect and this starts playing out in real time. it is going to be harder for people to get mortgages than just a few years ago but that could be a good thing. thank you. we appreciate it. coming up next the treasure hunt. find out why some of the stuff you might consider jun
of concern. you cannot have a system which a financial system earns money without people being able to borrow again, raise equity, raise debt, that s part of what is necessary to let economies grow. you cannot have growth without credit. when credit is available you will see banks starting to be able to be in business again. the way you guys have been and the administration have been handling this has been the stimulus package, help on the mortgage front, help with the auto sector, the federal reserve has been pumping liquidity into the system. at some point that has to end. do you worry that when the federal help to the economy starts tapering out, we will be in for a double dip? i m not worried that the reason i m not worried is because i think we re going to be careful not to put on the brakes before we re more confident. you have a private sector that can withstand the effects of the