Fannie Mae and Freddie Mac bailout is not funny.

The latest steps of US goverment trying to run, control & supervise US economy by bailing out financial institutions are anything but funny. They are as dubious as it gets.

Socialism in USSR fell apart in 1991. Capitalism in USA is falling apart right now.

How many more companies and financial institutions are going to get bailed out and why? Why do taxpayers – you and me – have to pay for some greedy or not-too-smart people and share with them our hard earned money? Why do we have to pay our mortgages & our bills,  while those “delinquent” don’t? Why nobody bails me & you out of all the losing trades, while letting us keep all the trades making money?

This is a Decline and Fall of the American Empire.

I don’t know what is going to happen to the stock market tomorrow – Monday, September 8, 2008. Probably it will run. As I pointed out quite a while ago to one of my colleagues – “America is a country of happy idiots”. The more I am involved in the stock market, the stronger I am convinced in it.

I can’t otherwise explain the irrational stock market behavior in many instances. For example, last Friday the news came out that the number of foreclosures has dramatically increased AND unemployment rate surged to 5-year high of 6.1%. What would be the rational reaction to such news by the stock prices of homebuilders?  More homes for sale + less buyers = less sales & less profit (if any). Yet, almost all the homebuilders have gained in price on September 5th:

KBH +$1.29

MTH +$0.65

DHI +$0.95

PHM +$1.07

TOL -$0.21

LEN +$1.48

BZH +$0.90

HOV +$0.25

CTX  +$1.26

XHB +$1.23

I still hope that at least gold will go up on Monday, as expected $300,000 billions cost of Fannie Mae and Freddie Mac bailout can be only covered by the new printed money. Does anyone except for me understand this?