Neil Cavuto and FOX News: I like you "" I really, really do "" BUT what am I not understanding ?
For the record "" I watch FOX NEWS as much as I can, it is my network of choice "" I love the format and the Anchors and the Guests "" All the shows are informative, have a touch of levity, move fast, efficiently and get right to the point.
I really do find that the reporting fair and balanced, except for this one point that I will explain.
At the risk of alienating you forever, I would like to ask a question, not only of you, but all the major networks. I hope that with some of your input, I can better understand the reporting of the real estate market and the overall condition of the economy. I doubt you will ever see this article, but I will try anyway, in the hope that a FOX BUSINESS NEWS PRODUCER picks up this article and question.
For the past year I have heard that the current real estate foreclosure crisis can be blamed only on a fraction of the total mortgages, and we should not worry. I believe the number originally started out at less than 1%, and recently you estimated that it went up to only 2% of the mortgages were in foreclosure. The mantra has been, let the free market operate.
I also hear and agree, that this situation is localized and is not a nationwide problem; but I don't agree that foreclosures are not a big problem. It may be local, but it is obviously a huge problem.
Yes, it may be only 2% of the mortgages are in trouble, but look at the collateral damage. That little 2% is affecting all economic strata. Retirement and pension funds are now trashed, the banks that are actively being supported by the FED or even worse Foreign bailouts. Credit scores are being ruined daily; homes can't be bought "here", because of the homes that can't be sold "there". Home equity lines are being frozen because of dropping values, and credit cards are being cancelled. College bound students have problems because of rising student loan costs. The destruction of the American automotive industry, as well as other industries is evident.
I liken that little number of 2% to an Achilles' Heel, that little 2% seems to be causing a lot of collateral damage to everyone in the US and the World. I assume you know that we are not the only Country having a foreclosure problem. Canada, England, Ireland, Australia and many others are also in trouble. I don't have those little tiny percentages, but what's the difference?
Estimates of Global damage are close to 8 Trillion Dollars. I hope that 2 % doesn't grow any larger, but I am afraid it will after the announcements about FNMA, FREDDIE,MAC, and now INDYMAC. The only "MAC" that seems safe is the BIG MAC. It's no wonder, it's the only thing that's now affordable.
The recent comments by Phil Gramm are indicative of the disconnect between our "leaders" and the typical American. (For the record I am a Republican.) Where has he been? You don't have to be an Economist to see the misery. Thank goodness John McCain caught that "pop fly" of a comment and put it to bed.
Now the question, - Are all our "leaders"- and networks in denial? Is the public perceived as that ignorant, that we can't see the handwriting on the wall? Do the "leaders" not read the reports of 5,000 to 7,000 foreclosures per day? Do leaders not hear about the families in Santa Barbara living in designated parking lots because they lost their homes? Are they not aware that credit card defaults are on the rise and the national credit score average is on the decline. Do they not read the reports of families in so much financial distress that they are desperately committing SUICIDE? I believe that little 2% is growing quicker than we think and is now trickling UP to all financial strata in one way or another.
It is now clear that our leaders and folks in the network newsrooms aren't even listening or analyzing what is obvious. The economy IS in trouble. It is not in the mind. Consumer CONCERNS are justified. Authors of the original definition of recession obviously did not foresee a housing crisis this devastating.
Sure the consumer has overspent, it is very obvious that they have; but just like a child who fell into a pool, you guide the child to the ladder so he can get out. It would be wrong to let the child drown just because he made a mistake and is struggling. Teaching is rationally more effective than punishment.
The estimates are that almost 70% of foreclosures are not seeking help or are falling victim to foreclosure scams. I have yet to see a concerted effort by any network or financial advisor on TV to counsel any of the 70% of families who are simply too devastated to seek help.
The Government bailout seems to be going nowhere fast, and it seems to be the wrong approach. I feel that it will probably be a waste of time anyway. If people on the "brink" can get help and obtain a workout, without Government intervention, everybody wins.
I know that you can't cover every aspect of business news. Hopefully all the networks will realize that this is a serious problem and with a little nudging and motivation, you can teach the people in trouble how to help themselves. Government bailouts will probably fail.
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