foreclosure

California foreclosures rose 92% in March. Analysts were quick to blame government programs that postponed foreclosures for the sudden rise. Nobody said a word about the newer, more ominous mortgages going past their five-year fixed rate period, although there is little doubt that herein lies the true cause.

Expect more trouble to come. Sure, consumers are spending again. But if you think that will lift the economy, hold on. Without jobs and with more foreclosures to come, it is hard to see how spending can be sustained. Sure, people are spending, but you need to ask yourself why?

They are spending because they have money and they have been sitting on it for a long time, holding their breath. Now it is time to let go. This letting-go is likely to last a bit longer as everyone is eagerly awaiting the recovery and making -wishful thinking- statements about it. There is little doubt we will see a bounce and that bounce may well last into summer.

With the advent of spring, reproductive juices are flowing and that always leads to more optimism, more joy, and more spending. When spring gives way to summer and no jobs appear reality will surely intervene sooner rather than later.