10 Things Going Right

Welcome to the initial post of my blog! I am looking forward to keeping you posted on the real estate market both here and nationally. To start off, here are 10 things that are going well right now. Shocked? Didn't think ANYTHING was going right? Well, check these out courtesy of Kiplingers and let me know what you think.

From Kiplingers:
Take heart. The editors of Kiplinger's Personal Finance and Kiplinger's forecasting came up with ten things going right these days.

1. Oil loses its swagger: With the US and global economy hurting, oil prices have dropped 50% in just 3 months, from $147 a barrel in July to the $70 range. Remember $80-$100 fillups at the pump? The national average for a gallon of gasoline is down to $3.00, from $4.11 in March, and should stay in the $3.00-$3.50 range through next year. Prices for home heating oil and natural gas are also headed lower this winter than last.

2. A tipping point for the auto industry: After years of talk and false starts, finally, all of the major carmakers are furiously developing hybrid and alternative fuel vehicles that could lessen our dependence on foreign oil. Meanwhile, desperate dealers are offering unheard of incentives on new gas fired models. For example, Toyota is offering $1000 cash back and 0% financing on t he 2009 Camry, the most popular car in America. Don't drive much? If you've always wanted and SUV or truck, the discounting on some models is extraordinary.

3. Interest rates are low and headed lower: The prime rate is at 4.5%, which is driving down interest rates on home equity line of credit and some consumer loans. The interest rate on a traditional 30 year fixed rate mortgage is averaging 6.5%, the highest it has been since the summer of '07, but still not too far from the historic low of 5.8% reached in 2003-2005 and 1963-1965. And although credit card companies are cutting personal spending limits, rates are dropping too. The average rate on a credit card purchases fell to 11.89% in the first week of October, down from 12.13% in September, according to lowcards.com, which tracks 1260 credit cards.

4. Homes are more affordable: Real estate, which was overpriced during the housing bubble, has returned to earth. That's especially good news for first time home buyers who were priced out of the market. While scare stories persist of credit drying up, the reality is more of a return to traditional lending standards that had been thrown overboard, recklessly in many cases, by lenders. That means to qualify you usually need a 20% down payment, sufficient annual income, good credit and a tolerable load of debt.

5. Your bank saving have never been safer: The $700 billion federal rescue plan more than doubles the amount of federal deposit insurance on individual bank accounts, to $250,000 from $100,000. Uncle Sam sweetened the pot further on October 14 by providing unlimited FDIC insurance on non-interest bearing accounts. That will provide more coverage for the nation's small businesses, which use these accounts. Plus, a new temporary federal insurance program covers the full value if your money market fund shares fall below a net asset value of $1.00 (called "the breaking buck"). The program provides coverage for shareholders for the amount they owned on September 19, 2008. See your financial crisis questions answered for more.

6. Stocks are on sale, and many bonds offer terrific yields. The current bear market is approaching the 1973-74 and 2000-2002 downturns, the two worst retreats since WWII. That's the bad news. The good news: individual blue chips are selling at bargain prices. For examples, shares of AT &T (symbol T) sell for about eight times estimated 2009 earnings and yield 6%. Networking giant Cisco Systems (CSCO) sells for only ten times earnings estimates for its July 2009 fiscal year. Johnson and Johnson (JNJ), as steady an Eddie as you'll find, sells for just 13 times '09 forecasts, and Google (GOOG) is going for less than 15 times estimates. Triple-A-rated tax free bonds, and extraordinarily safe investment, are paying 5% plus for ten years and 6% for 20. That's more than the Treasury offers for bonds of the same maturity.

7. The miracle of technological innovation continues. Been to Best Buy, Sam's or Costco lately? For $799, you can now buy a 42 inch, HD flat panel TV that will knock your socks off. Throw in another $200, and you can get a surround sound system to truly transform your den into a home theater. A top of the line PC with more memory than you'll ever use now costs $1,000, high end laptops with all the bells and whistles go for $1,200, down from $2000-$4000 five years ago. And giant leaps in handheld devices, such as Apple's new iPhone, have revolutionized the way people interact with the world.

8. Prosperity reigns in the heartland. The fall harvest is shaping up as one of the best ever, despite the destructive weather and floods in the Mississippi River corridor since last spring. Exports of US farm products wil lincrease more than 40% by value this year. And recent years of high profits have allowed farmers to pay down debt so low that it accounts for a measly 9% of their assests - providing all the credit they'll need for 2009 operations. At home, while food prices jumped sharply earlier this year, the weak economy is now expected to slow further price increases.

9. A new tone and direction in Washington. Whether it's Barack Obama or John McCain who enter the White House in January, election of a new chief executive should provide at least 100 days of galvanizing certainty for markets, and a new direction and sense of purpose for the country.

10. Shoppers can expect great gift buys this holiday season. Retailers depend on robust end of year sales to turn a profit, but for 2008, the National Federation of Retailers forecasts holiday spending will increase only 2.2% from last year. That won't even beat inflation. It's good news for bargain hunters, though. Both brick and morter and online retailers are gearing up to offer huge discounts to boost sales. For example, Deal News predicts a DUAL Core Intel Laptop will go for as low as $299 on Black Friday, the day after Thanksgiving, and a Canon PowerShot SD1100 will go for a very low $139.

So chin up. We've been through hard times before. To quote Rudyard Kipling, "If you can keep your head when all about you are losing theirs...."

This article taken directly as noted from Kiplinger's Personal Finance.