Perspective

Home sales are up and the experts are telling us the recession is over. Yes home sales have increased because there is a rush to get the $8000 tax credit as a first time home buyer. And if you haven't owned a home in the previous three years you qualify. That ends in November and unless the government extends it I think sales will fall off dramatically. Also, foreclosures continue with a momentum of their own, even though the banks are holding back from putting homes on the market. The prices of homes continue to come down. With the combination of these participating in unison, the current increase in sales is temporary.

Now that the 'cash for clunkers' has ended, watch the dramatic decline in car sales. Again, only a momentary improvement in sales.

These types of government interventions only delay what needs to keep unfolding; getting back to the ground from the clouds we have been in with home prices, using debt for accumulating material things and so on. Keep saving, paying down debt, and being conservative with your investments. Be prepared so the 'bear' doesn't take a big bite when he comes back to eat.