Economic Report for November 24, 2009 by CEOSpace Chairman Dohrmann

CEO Space Inc for Business Owners and Entrepreneurs

MORTGAGE DEFAULTS:

The unemployment level is impacting the economic recovery. The ever increasing lay off and sinking in the general economy, has reached a November level, where one in seven prime mortgages are in default or one to three months late. This late loan payment in the prime mortgage space is the HIGHEST on record since the early 1970’s when records on late payment began to be tracked. The trend is growing. This drag on the economic recovery is not likely to reduce until unemployment rises, which is not anticipated until 2011 and even then slowly. As more people on long term unemployment run OUT of benefits the rise should be larger yet.

As you can appreciate the banks, are being asked to improve their reserves. On one side the banks have rising loses eating into reserves. On the other nations wish to improve the bank reserves. As this sandwich of demand on liquidity has ENORMOUS pressure on credit. As credit is needed to advance the economy, and no one is working on this core problem at the NATIONS level with cooperation integration and strategy, the outcome is unknown. We are in NEW financial history. The past does not predict the future. The truth? What is the outcome? The truth is, we do not know and can no longer predict.

You of course already know this ….

SILO RECOVERY

Silos in the Green Space are showing green hair versus roots yet. The industry has insufficient money. To help small business of the trillion two stimulus package of over 1000 million dollars 67% has yet to reach local states and counties. The total set over for small business to put employees back to work was 500,000,000 or 500 million, parking meeting money. That sum was spent in the first half of the year and the Small Business Administration is broke. To help stimulate jobs, which requires at least three trillion dollars to be effected, a new 100 million is being allocated to the SBA. This sum will be spent in 30 days or less and the SBA will be broke again. It is hard to build new silos when the policy is lopsided to specific silo’s and not others. The market is encouraged by the new home sales this fall, which were up 10% in October. The market was silo driven and no all home recoveries were equal. Some states did much better than other states. Some states grew some shrunk in population and economic opportunity. The largest migration of US citizens since the dust bowl is taking place as populations move from states without jobs, like California the rust belt in the North East and Florida, to states offering jobs like Alabama, Texas and Northern Nevada. People are walking away from upside down homes and no jobs and taking new positions, starting new lives, in new areas of the nation. This trend is expected to continue and the result is a lack of regional stability. The fluid dynamics of the recession are far from over, and the worst effects of recession are unknown. The trillions needing to be refinanced for commercial real estate by 2013 is a huge unknown in the world market place. What if the banks can’t place that paper, given defaults in 2008 for commercial property were the highest on record and in 2009 the defaults for commercial property rose over 2008 by 46% and this percentage is climbing up bubble rapidly. Banks are having to take back high rise office buildings, special use buildings like Circuit City, strip malls, larger malls and more? Do they have the capacity to operate these gigantic property management missions, and create a market to resell these defaulted disaster PRIME property loans? And how will they refinance trillions in default ? No one knows the answer. We are in new frontier on the economic sea. IS the depression postponed versus removed ? No one knows. That is the truth as we enter Thanksgiving in 2009. We continue to labor very hard to keep our business owners informed.

WAR TAX

The notion of providing a war tax on the American People, is gaining strength. During a contraction economically, when consumers are drowning in debt and unemployment, to factor in a further removal of cash from the system, through a war tax, may set the recovery on its ear. As all these details are new financial history with no reference to past recession economic policy, predictions cannot be made as to future outcome. We have suggested a W recession is likely, wherein the recession returns with a vengeance, and the drop in the DOW, in prices, in home prices, in value in general, skyrockets as the current deflationary spiral, the seed of all depressions continues forward as it did for ten years in the Japanese collapse last decade. The combination of 7 trillion requiring refinancing in the shattered bond markets by 2013, over 3 trillion from US banks alone, is a sobering execution in any market. No one can predict or understands the outcome, just as we are about to expand the proxy war with Iran and send more troops into Afghanistan perhaps by the Holidays. While we must stay the global course with so much at risk, the will and the money, are both going to be challenged for the American people for decades into the future. One might ask, did George Bush get sucked into a Terror Master Plan, which plan has in fact gained the upper hand and is winning? The west economy collapsed as predicted by Bin Laden. The world generally hates America as never before. The top cards in the deck are free to plan and execute further attacks against the west, and do so frequently. The prestige of the USA has sunk to a level that undermines the super power position of the leading force for good in the world. To repair these conditions is to win the war on terror. The question, is current policy doing the job?

Berny Dohrmann
Chairman

PS: Next CEO SPACE CLASS – Dec 15th – Last chance for tax savings and income up ramp from the best largest trade show in history for CEO SPACE – enroll on line www.ceospace.net –enter Club Manager Rebecca Olkowski I approve this message.

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Economic Report for November 24, 2009 by CEOSpace Chairman Dohrmann

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