The latest report on manufacturing came in below expectations. This is more evidence that business spending has hit a wall. Businesses usually borrow at the LIBOR rate, which is still high since banks don't trust each other. So despite the Fed's easing, businesses' cost of capital remains very high.

This past weekend, my wife and I went to look at a new home. There are so many homes for sale that sellers are desperately looking for bids, even if they're just 60% of the asking price.

Another problem that I noticed is that the California homes in Tahoe have outrages property taxes that are just as bad as Florida. Nevada passed a 4% transfer tax on all property sales/transfers and that's killing the market.

Florida is now over $1 billion in the red and California is potentially $18 billion in the red, so the housing slowdown is definitely hurting state revenues. Unemployment is rising so the Fed needs to come to the rescue fast!