WASHINGTON — Federal policy makers have concluded that the turmoil plaguing the housing and financial markets is likely to spill deep into 2009, becoming one of the most significant domestic problems to confront the next president when he steps into the White House in January.


Ben S Bernanke, the chairman of the Federal Reserve, publicly indicated on Tuesday that he believes the problems will persist into next year when he outlined a series of steps the Fed is considering in the coming months.  


One such step would extend low-interest lending programs to Wall Street’s largest investment banks into next year. The programs, one of which was set to expire in September, can continue only if the Fed issues a finding that there are “unusual and exigent circumstances” that justify them.


Mr. Bernanke also recommended that Congress grant the Fed broader authority to monitor and supervise the financial markets to assure greater stability in the future. But with time running out on this session, lawmakers are unlikely to adopt such legislation before next year.


Treasury Secretary Henry M. Paulson Jr. said in a speech last week in London that the problems of the housing and financial markets might last longer than originally expected.

He followed up in another speech on Tuesday by saying that the Bush administration was working to prevent as many home foreclosures as possible, but that “many of today’s unusually high number of foreclosures are not preventable.” Mr. Paulson said 1.5 million home foreclosures were started in 2007 and that an estimated 2.5 million more would take place this year.


Still, the markets seemed reassured that Washington officials were redoubling their efforts to resuscitate the weak housing sector, despite the downbeat comments. The Dow Jones industrial average, which has fallen sharply in recent weeks, closed up 1.4 percent, or 152 points.


Mr. Bernanke said that the Fed would issue next week long-awaited rules to restrict new exotic mortgages and high-cost loans for people with weak credit. Such mortgages have been a central cause of the current market problems.


The Federal Housing Administration will also begin an expanded effort next week to help a larger group of troubled homeowners refinance their adjustable mortgages. Under the plan, homeowners would be eligible to refinance even if they have missed up to three monthly mortgage payments over the previous 12 months.


Homeowners who have fallen behind on their payments because of job loss, declining wages and family illness would also be eligible, even if their rates have not increased. Homeowners are now eligible only if they were current on their mortgages before their interest rate was adjusted upward.


For its part, Congress is close to completing legislation on a $300 billion foreclosure-rescue plan that would help troubled borrowers refinance into more affordable loans insured by the federal government. The Senate is expected to approve a measure by next week.


The Fed created the lending programs to Wall Street in March as part of a broader effort to prevent financial institutions from collapsing, as Bear Stearns nearly did before it was sold under heavy pressure from the Fed and the Bush administration to JPMorgan Chase.

The lending programs to the investment banks, a broad expansion of the Fed’s historic practice of providing loans only to commercial banks that the Fed supervises, are intended to provide confidence to financial institutions that they will have enough cash to meet their daily needs. And by permitting investment banks to post collateral for Fed loans, including hard-to-sell financial instruments backed by mortgages, the programs have helped prop up the enormous and troubled market in securities sold by Fannie Mae and Freddie Mac, the all-important mortgage-finance companies.


The two buyers of mortgages, which together held more than $1.4 trillion of mortgage-backed bonds as of the end of last year, have struggled in recent months through the wave of foreclosures and declining housing markets. On Tuesday, Fannie Mae closed up nearly 12 percent, and Freddie Mac rose 13 percent, after their regulator said he would probably not force them to raise more capital because of an accounting rule change. The shares of both government-chartered companies had tumbled on Monday amid concerns over the accounting rule and worries that the worst of the mortgage crisis was yet to come.


Officials said that the Federal Reserve remained concerned that the declining housing market would not reach its bottom and financial markets would not become more stable before some time next year, and that the economy would continue to suffer as a result of declining consumer confidence, a sluggish global economy and the widespread effects of the rapid jump in oil prices.


“The financial turmoil is ongoing, and our efforts today are concentrated on helping the financial system return to more normal functioning,” Mr. Bernanke said at a forum in Virginia on lending for low- and moderate-income households. He did not provide a forecast of how soon he expected markets would begin to turn.


“Although short-term funding markets remain strained, they have improved somewhat since March,” Mr. Bernanke said, reflecting both the intervention of the Fed in offering loans to Wall Street and “ongoing efforts of financial firms to repair their balance sheets and increase their liquidity.”



Officials said that the Fed privately reached the view some time ago that weakness in the housing and financial sectors would likely continue well into next year. Mr. Bernanke’s comments Tuesday were not intended to signal any change in interest-rate policy.



In his speech in London, Mr. Paulson emphasized that the financial markets have yet to adapt to the changing climate. “Working through the current turmoil will take additional time, as markets and financial institutions continue to reassess risk, and re-price securities across a number of asset classes and sectors,” Mr. Paulson said.


The Federal Housing Administration’s expanded program to help more troubled homeowners refinance, called F.H.A. Secure, was announced in April at a time when fewer than 2,000 homeowners at risk of foreclosure had been helped by it. Housing Secretary Steven C. Preston said the expanded program would help an additional 100,000 borrowers in crisis by the end of the year. So far, more than 260,000 homeowners have refinanced through the program, the vast majority of them people who have paid their bills on time. Mr. Preston predicted that 500,000 families would be helped by year’s end.


Mr. Preston warned, however, that F.H.A.’s efforts could be derailed if Congress passed housing legislation that failed to safeguard the agency’s financial stability. He said he was concerned about efforts to eliminate the agency’s plans to use risk-based pricing, which would allow F.H.A. for the first time to charge higher mortgage insurance premiums to borrowers viewed as presenting a higher credit risk.


He said he was also concerned about efforts by some lawmakers to maintain an agency program in which the seller finances the down payment on a mortgage. The program has suffered high delinquency and foreclosure rates in recent years, and the F.H.A. hopes to eliminate it.


If the Senate, as expected, adopts housing legislation by next week, differences need to be ironed out in the House, which approved a similar measure in May. Though the White House has expressed some willingness to negotiate, the administration has not rescinded a veto threat.


Senator Harry Reid of Nevada, the Democratic majority leader, urged Republican lawmakers to speed up the bill, which has been slowed by a procedural fight despite broad support among lawmakers in both parties. “Since the last stall on the housing bill, 85,000 more Americans have received foreclosure notices — 8,500 a day,” Mr. Reid said. “Tomorrow it will be over 90,000. Every day they squander the Senate’s precious time, the American people lose.”
Let us know your thoughts?  You can email george@hbsadvantage.com
What steps are you taking to prepare for the tough times?
Hutchinson Business Solutions
Smart Solutions for Smart Businesses
Ben S. Bernanke


As reported in Reuters:


JOHANNESBURG (Reuters) – Former Federal Reserve Chairman Alan Greenspan warned on Tuesday the U.S. economy was on the brink of a recession, with the chances of that happening at more than 50 percent.


The U.S. economy has been hit by a credit crisis, which began in the sub-prime mortgage market, prompting a series of interest rate cuts to help boost the economy. But price pressures are growing, making more rate cuts unlikely.


Asked if the U.S. economy was in recession, Greenspan said: “We are on the brink.”

A quick recovery was unlikely, he said via video link to a conference in Johannesburg. “A rebound at this stage is not something I think is in the immediate outlook,” he said.

“There are still very considerable structural problems remaining in the financial system. They will remain for a while. It’s going to be very difficult. There are a lot of unexpected adverse events out in front of us,” Greenspan said.


Greenspan said he did not believe arguments that the housing problems in the U.S. were due to interest rates being too low during his tenure. “As far as I’m concerned, the data do not support it (that argument). The housing bubble is clearly an international phenomenon.”


Our Perspective:


Pressure continues to grow in the business sector. Everyday you read a headline that another corporation is having massive layoffs. Fuel prices continue to rise, this leads to a rise in food prices. It becomes a spiraling effect. Our lack of commitment to address these issues in the past has come full circle.


What do we do?


Instant gratification has been the calling card but look where it has gotten us. We must focus on the long-term solutions that will increase the quality of life as we go forward.


Energy alternatives (solar, wind, geothermal), new ways to power our automobiles ( electric, water, I even heard of cooking grease). We must think outside the box to introduce new solutions that work and are a benefit to all. Just not a few.


Hutchinson Business Solutions, that is what we do. Introducing new ideas, creating opportunities that define a better tomorrow.


Let us know your thoughts? You can email george@hbsadvantage.com


Visit us on the web www.hutchinsonbusinesssolutions.com


As reported in AP


Wholesale prices post biggest gain in 6 months, propelled by energy and food costs


WASHINGTON (AP) — Wholesale prices bolted ahead in May at the fastest pace in six months as energy and food costs marched higher.


The Labor Department reported Tuesday that its Producer Price Index, which measures the costs of goods before they reach store shelves, shot up 1.4 percent in May. That was up from a modest 0.2 percent rise in April and marked the biggest increase since November.


However, stripping out energy and food prices, which can swing widely from month to month, the “core” rate of inflation rose 0.2 percent in May, an improvement from the prior month’s 0.4 percent increase. That suggested that other prices were fairly well behaved.


The overall inflation rate of 1.4 percent was higher than the 1 percent rise many economists were forecasting. But the increase in core prices matched their expectations.



Our perspective:


Food and energy are becoming the basic necessities nowadays. Throw in medical and other insurances and that seems to be all we are working for. To cover the basics.


We have to take a long hard look.


It seems that the last 20 – 30 years our economy has skyrocketed and at the same time it is becoming unaffordable. This would tell you that we are not addressing the issues properly.


We must be willing to look outside the box to define and create real solutions that work and benefit all, just not a few.


We do this in business everyday.


Hutchinson Business Solutions prides itself on “ Thinking out of the box,” creating opportunities to provide savings and increase efficiencies.


Whether it is Business Taxes, Energy, Communications or Insurance; we are addressing these topics with an eye towards the future. 


We would like to know your thoughts? You may email george@hbsadvantage.com


Hutchinson Business Solutions     …….     Your CFO on the Go


Creating Opportunities Today…..Providing Savings for Tomorrow


Visit us on the web www.hutchinsonbusinesssolutions.com




Who defines Recession

April 16, 2008

 As reported in Bloomberg:

April 16 (Bloomberg) — Economists arguing over whether the U.S. is or isn’t in a recession may now have a new measuring tool: mentions of the word in the New York Times.

The economy shrank the five previous times since 1960 that “recession” appeared this often in the 156-year-old newspaper, investment-research firm Bespoke Investment Group LLC said today.

“Once the media and everybody starts talking about it, it can become a self-fulfilling prophecy,” Bespoke’s Justin Walters said during an interview. “It just adds to the pressure on the economy.”

The Standard & Poor’s 500 Index has retreated 13 percent since reaching a record in October amid concern $245 billion in subprime-related losses at banks worldwide will slow growth. The U.S. is, or will soon be, in a recession, according to the majority of economists surveyed by Bloomberg News from April 2 to April 8.

“The word `recession’ has spiked significantly since the third quarter,” according to Harrison, New York-based Bespoke’s report. “There were spikes in `87 and ’98/’99 that didn’t turn out to be recessions, but the spikes didn’t reach current levels.”

Our Perspective:

I am interested in hearing from you as to what your thoughts are.

Are we in a recession?

Energy, food, medical cost are rising.

Unemployment claims are at record highs.

 The Fed keeps dropping the rate but credit is tight.

Are these signs?

What are you doing to address these issues?

Do you feel powerless?

What if you are a business owner?

Are you taking the steps to position your company?

Our clients are being proactive and asking questions.

They are creating opportunities to provide savings.

Do you have a question?


Let us know your thoughts?


You may email george@hbsadvantage.com


Hutchinson Business Solutions ……Your CFO on the Go.


Creating Opportunities Today,…Defining Savings for Tomorrow.

Visit http://www.hutchinsonbusinesssolutions.com/ to learn more about saving opportunities available for your company.

As reported in Bloomberg

April 11 (Bloomberg) — Confidence among U.S. consumers sank to a 26-year low in April as the labor market continued to deteriorate and gasoline prices rose.

The Reuters/University of Michigan preliminary index of consumer sentiment decreased to 63.2 from 69.5 in March. The reading was below the lowest forecast in a Bloomberg News survey and the weakest since March 1982.

Americans are confronting the loss of 232,000 jobs so far this year, along with higher food and energy costs and overall weakening in the economy. Consumer spending in the first half will advance at the slowest rate in 17 years, according to economists surveyed by Bloomberg News.

“The consumer’s feeling increasingly hemmed in,” said Brian Bethune, director of financial economics at Global Insight Inc. in Lexington, Massachusetts. “They’ve got higher energy bills, higher gasoline bills, higher food bills and obviously the employment markets are nowhere near as strong as they were. The economy is in a recession.”

Our Perspective:

The R word keeps popping up. Seems like more people are using it with greater frequency these days.

Allen Greenspan also used it the other day.

Seems like this has become a cyclical thing. That is what happens when we keep pushing the rock forward and not addressing the issues that confront us. We grow complacent.

So many issues are contributing to us being in this predicament. The sad part is that if you look back, we have been talking about the same issues for the last 40+ years.

What or you doing to address this issue in your own back yard?

Are you being proactive?

Are you looking to reduce cost?

Are you making your company more competitive?

So many people have worked hard and put a lot of sweat equity into building their American Dream. Don’t let it slip away.

We are working with our clients, reducing cost and strengthening their bottom line.

The time to act is now!

Do you have a question?


Let us know your thoughts?


You may email george@hbsadvantage.com


Hutchinson Business Solutions ……Your CFO on the Go.


Creating Opportunities Today,…Defining Savings for Tomorrow.

Visit http://www.hutchinsonbusinesssolutions.com/ to learn more about saving opportunities available for your company.


Spread the good news….. share this information with a friend.


As reported in Bloomberg:

April 9 (Bloomberg) — Federal Reserve Bank of Dallas President Richard W. Fisher said the housing market hasn’t hit bottom, and acknowledged that recent interest-rate cuts haven’t lowered borrowing costs for households and companies.

“The housing crisis may not yet have run its course, and further danger could lie ahead,” Fisher said in the text of a speech today in San Antonio, Texas. “The U.S. economy will continue to suffer from a bout of anemia while the housing and financial markets settle down.”

The comments echo the assessment of Fed policy makers at their meeting last month, when they concluded that signs of stabilization in the housing slump had yet to emerge. Central bankers anticipate the economy may contract in the first half, with a recovery in growth later this year.

Our Perspective:


Uncertainty reins in financial markets.


Crude oil jumped to $112 a barrel. Again, I heard that $4.00 gas could be in our near future.


The Fed has taken the steps to reduce rates for the banks, however the banks are still holding back and are not lending money.


You can get whiplash watching the stock market.


The Iraq hearings are being held in Washington and Gen Petraeus has offered no hope of an early exit. Meanwhile the bills keep mounting.


What steps can we take?


What are you doing to insure your company’s viability in these turbulent time?


Are you being proactive or is it business as usual?


Our clients are looking at their cost of operations.


Clients are savings from 15% to 40% looking at their telecom and data cost.


Clients are receiving refunds for overpayments of payroll taxes and sales taxes.

Several have been in the 6-figure range.


Would that help your bottom line?


Clients with larger fleets are looking at our GPS fleet management solution.

They are finding their ROI is less than 6 months.


Do you have a question?


Let us know your thoughts?


You may email george@hbsadvantage.com


Hutchinson Business Solutions ……Your CFO on the Go.


Creating Opportunities Today,…Defining Savings for Tomorrow.Visit http://www.hutchinsonbusinesssolutions.com/ to learn more about saving opportunities available for your company.



Spread the good news….. share this information with a friend.

March 28 (Bloomberg) — The dollar fell against the euro, headed for its biggest weekly decline since January 2006, as traders increased bets that the Federal Reserve will cut interest rates again to avert a recession.

 Is this too little to late? 

Ask Gov. Corzine, he said the R word this morning on Morning Joe. He was asked by Joe Scarborough, “ Do you think we are in a recession.” His answer…”Yes.”

He went on to say that many of the things that the government is now doing is correct but they were too slow to pull the trigger. The Government should have taken these steps months ago.

Now what do we do? 

Ask John McCain, He doesn’t think the government should do anything.

Both Obama and Clinton are saying they will take steps to address these issues but that could be another year from now.

In the meantime, the economy is on a roller coaster.

The Feds keep cutting rates but the banks are not lending money. The housing market continues to suffer for people cannot get a mortgage.

Those stuck with high mortgage rates, try to take the high road and continue to pay high monthly payments with no relief in site. Some are even opting to walk away from their investment. That only will cause more problems down the road.

 What about the small business owner? 

Sales are down and costs continue to increase.

We are working with many small and medium size clients, reviewing costs, creating opportunities that will help them weather the current crisis.

Many hours have been vested to help build their American Dream.

This is not the time to be complacent!

There may not be a silver bullet cure-all but there are steps that can be taken to help reduce cost.

This is the time to be pro-active. 

Let us know your thoughts?

You may email george@hbsadvantage.com

 Hutchinson Business Solutions ……Your CFO on the Go. 

Creating Opportunities Today,…Defining Savings for Tomorrow.

Visit http://www.hutchinsonbusinesssolutions.com/ to learn more about saving opportunities available for your company.

Spread the good news….. share this information with a friend.

Do you?

January 21, 2008

Do you have vehicles on the road?

Where are they?

How much time is wasted traveling between assignments?

 How is their driving? 

Many companies are asking this question and have phone numbers visibly placed on the back of their vehicles.

 Have you received any complaints? 

Are your vehicles running efficiently?

 Has the manufacturer ever notified you of a recall? 

Do you keep vehicle service records?

How would you like all this information right at your disposal?

 Networkcar has made it very affordable. 

Whether you have 3 vehicles or 300 vehicles, you can place all your vehicles in the palm of your hands.

No special programs, you can access Networkcar from any computer. Just log in and our satellite will locate all your vehicles. It will provide a log of:

·      Where are all you vehicles?

·      Where they have been since the day started?

·      How fast are or have they been going?

·      How long were they idling?

·      Is the engine currently running or is it off?

·      Has there been any off time usage?

·      What is the current mileage?

·      How many miles per gallon is the vehicle getting?

·      Is there any signal noting the engine needs attention?

·      Is it due for routine maintenance?

·      Has there been a recall?

This is just a sample of the information that is available to you.


Click on or copy the link provided below to learn more about the benefits of the Networkcar solution.



Our clients find that Networkcar is the solution they have been looking for?

 Affordable, our clients are finding the ROI is less than 6 months. 

Want to know more?

Just give us a call and ask for a demo.


 Hutchinson Business Solutions…Your CFO on the Go.

Defining opportunities today … Providing savings for tomorrow.