More Government Bailouts & Funding, Changing Of Bankruptcy Law: What’s Next?

Today (Wednesday) was interesting, to say the least.  With the S&P 500 (^GSPC) closing down $0.75 to officially close at 788.42, not to mention the index was mixed throughout most of the day, the market showed absolutely no direction during the trading session.  I’m not seeing any market direction in my ETF/iETF watch list either, which makes me quite uneasy.

Because of this, I decided to get in and out of UltraShort Real Estate ETF (SRS) today to take a $1.31 gain, buying @ $78.69 (quite late, for I was away from my computer when it begin pushing higher @ $75) and selling @ $80.00 before it dropped to its close of $76.21 (A-H price concluded at $77.75 with a volume of 69,750 backing the price action).  Other than this trade, I’m 100% Cash and waiting for the market to give me some sort of direction.  This, sadly, is where my novice-ness murders me.
In other news:

I thank Sean Delonas from the NY Post for gracing us with his absolutely hilarious cartoon.  He received some angry comments from none other than Al Sharpton, but come on:  When does Al Sharpton NOT complain about something?  Mr. Delonas, phenomenal cartoon; keep up your honesty and hard work!
Now for some noteworthy articles:

• http://money.cnn.com/2009/02/18/news/companies/auto_bailout/index.htm - Cut me a break!!  How many times do people have to preach the, “If You Give a Mouse a Cookie” Theorem before our elected officials realize that pumping money into these two automakers is not only ridiculous due to its price, but also because of the principle of the whole fact; THEY SAID THEY WOULD BE FINE and now they’re asking for more money on the same basis as the financial institutions:  ”Trust us!  You know we’re good for it!  We’ve learned our lesson, we promise we’ll use THIS round of government funding for the CORRECT reasons!”  If Congress allots them the given amount, the Obama Administration will have some serious issues with popularity in this country.
• http://money.cnn.com/2009/02/18/news/companies/ubs/index.htm?postversion=2009021818 - Yet another “Cut-Me-A-Break.”  Indirect Tax Evasion from a large financial institution like UBS (NYSE:UBS) is completely uncalled for and despicable.  They now are being forced to pay $780 million to fess up the accounts of the U.S. citizens who they helped out in the process.  What is this world coming to?  Wouldn’t it have been a whole lot cheaper to not help those people out?  Now look what you’re dealing with, UBS: a nice, fat check and a “fraudulent institution” sticker slapped to your forehead.

But the most noteworthy article of today’s action is the one seen below:
http://www.cnbc.com/id/29263436

Welcome to the wonderful world of ObAmerica, where the country thrives from government spending and is lulled to sleep by the quiet chirps of our President’s Blackberry at night.  This article is today’s biggest “Cut-Me-A-Break,” and let me tell you why:

1. A direct injection of $25 billion MORE + UP TO $200 billion to stimulate capital for the famous Bonnie and Clyde of housing criminals, Fannie (NYSE:FNM) and Freddie (NYSE:FRE) (as well as giving these institutions the opportunity to potentially increase their mortgage portfolios by a supposed $50 billion).  This is just another way to pump more money into the struggling home insurance companies, allowing them to “modify mortgages” for the government.  Seriously?  Don’t you think these two firms have done enough damage for one Housing Crisis?  Why not add AIG (NYSE:AIG) in there too, get the whole gang involved?  Hell, let’s allow the folks to get some lending from Bank of America (NYSE:BAC) and Citigroup (NYSE:C) after their mortgages are modified just to get them on their feet again?  This is an accident looking for a place to happen.  It’s understandable that our government would go to Fannie and Freddie after their nationalization in September of 2008, but get real: with all the mistakes they made to drive their clientele into the ground BEFORE their bailout, why would you give them the right to modify these mortgages?  I’ve got an idea: Let’s allow the Regional Home Insurance companies modify the mortgages of the people who need modification in their areas of living?  If the Real Estate and Housing industries have been so damaged by this catastrophe, why not let this work itself out the capitalist way and give the Regional Home Insurance companies the chance to become the ones who receive the credit for modifying the mortgages the correct way?  Just a thought…
2. The changing of bankruptcy laws in order for this plan to work is asinine.  For God’s sake, this administration is changing our entire system in order to spend their way out of our country’s financial mess.  Welcome to our next Roosevelt, boys and girls.  What people don’t understand about Roosevelt, however good an orator he may have been, is that the spending in his New Deal (worth $500 billion) didn’t get the United States out of The Great Depression.  It was World War II that did this justice.  Pretending that WWII wasn’t a factor, Roosevelt would probably be close to last on the Best President’s List instead of 4th.  First it’s Mark-to-Market, now a bankruptcy law allowing judges to rewrite mortgage terms loans created over the past years.  What’s next?

This question really encapsulates where many minds are these days.  The $787 billion stimulus plan on top of this $275 billion housing plan are, in my opinion, too vague at this point.  They are also too anticipatory, meaning that Obama’s administration is hoping that his “substantial incentives” will really make people want to participate.  These plans will show us very quickly that spending is not the way, for it sets up a country like the United States for failure.  I bid the Prez good luck…  And, through serious wishful thinking, good riddance.

So I ask you…  What’s next?

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