Kona Kohala Blog

This should be an interesting week for the world of real estate.  Today, the president signed the new recovery bill into law meaning we are now another $700+Billion in debt with no end in sight but some nifty possibilities for real estate.

The biggest bonus for first time home buyers which includes those who haven't owned a home for 3 years, is an $8,000 tax credit.  This will go a long way to helping out home buyers but you do have to make the purchase by December 1, 2009.  The biggest difference between this and the $7,500 credit is that this one does not have to be paid back.

On Wednesday, Obama has said he will unveil his housing recovery program.  I'm looking forward to seeing the contents of this package since it could have the farthest reaching effects for the economy.  Offering a tax credit is a great idea but short ranged in its coverage.  We need longer range fixes like more access to well structured fixed rate loans.  In order to get that we need people who qualify for such loans.  In order to get them, we need a good job recovery program to put people back to work.

The government wants to set up public works programs to put people back to work.  Hopefully, these will be bid contracts with independent companies of all different levels not just the big guys that can afford to undercut the bids of the medium to small sized construction companies.

There needs to be other job building since the governments history of doing anything is dismal.  Do you realize that after the Mustang Ranch, a well known house of ill repute went under the government took it over and ran it into the ground.  Our government couldn't make a profit out of a bar and a whore house, how do we expect them to make a profit at anything they try?

As much as tax cuts for business runs counter to common sense (of which there doesn't seem to be enough to go around) it is the only way to stimulate that sector of our economy.  Make it worthwhile for businesses to grow, to build new plants or offices.  Give them a break on some of the taxes they have to pay.  Relax the overly strict regulations that stop businesses from being started let alone expanded.

Once we have people developing jobs and allow them to make a decent profit they will beging to create new and expanded businesses.  More people will go to work.  New businesses will be started by the entreprenuers, creative minds everywhere will gear up when the opportunity presents itself.

Small business makes up a huge proportion of the employed population of this country so lets cut them a break now and then.  Let's revert back to the old days of growth when men and women were rewarded for starting new businesses.  Then, with a vibrant fertile bed for new business to grow, we will see people being hired again.  We'll see businesses expand and we'll begin to see our tax coffers begin to fill again as they did under Reagan.

He made creating jobs pay and people created jobs.  Money flowed into the government at the federal and state levels.  People saved and spent money and our economy was healthy.  This allowed people to buy homes and when that happens all the ancillary industries thrived.  Let's not rely on the government to give us jobs.  Let's bite the bullet and let our economy start over again, start with we the people doing what we do best, create.  We can create jobs that then create wealth.  When people are no longer worried about feeding themselves and their families they feel better.  Well fed people make better citizens and better citizens take better care of each other and their environment.

While there is no silver bullet, no single fix, focusing our efforts on stimulating the individual business man or woman will do more to fix this country than all the funny money the U.S. Mint can print and all the public service jobs our government can create.  aloha