Across the US home prices have come crashing down, making them affordable again, for anybody looking to buy a home that is. Prices continue falling gradually each month and in the turmoil some people see opportunity knocking, but is this going to cause a new surge in demand? Absolutely not. This is quickly turning into an investor’s market and while this may bring relief to cities and lenders across the US for unloading this surplus of homes, it won’t necessarily bring good to all.

Other financial sectors have been affected by the real estate crash and because the signs are too obvious that we’re in a down fall, for the most part consumers are keeping cautious about overspending.

This pessimistic attitude, which is not at all unjustified, can create a problem for the Fed as it has in the past. When the majority of the population views the economy as a sliding trend to disaster, the feeling can spread quickly across the nation like nerve cells. This forces rate cuts and more attempts to revive the economy by printing billions more of our already devalued green backs.

The federal government’s answer to stimulate the economy by sending out tax rebate checks is one that will prove negative. This is an attempt to raise the spirit and enthusiasm of consumers and get us all back in the habit of spending, but without a solid outlook of an economic turn around, there’s very little chance of this actually working its intent. The stimulus checks will be held on to or used to pay off debt and not much else.

Much of this negative attitude is based on the high prices of energy products like gas and electricity. Gasoline in particular has reached an unseen level and shows no signs of moderating by anyone’s efforts. This takes a major toll in the level of confidence that is expected to be induced by this petty plan of tax rebates.

There are several other metrics in between the real estate market crash and the rising price of oil and energy products that are in full force at debasing this economy. It’s not too far fetched to say that we could be reaching depression like levels of recession. The real estate market is in a sump that it can’t be dug out of for many years to come. The rising prices of fuel and the other ailing elements within this faulty economy are steering us all into this state and no agreeable plans to rescue the economy are yet available.

Stimulus checks? let’s get real.

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