Backers Rally to Bernanke – The Wall Street Journal
The political winds appear to be shifting in Federal Reserve Chairman Ben Bernanke’s favor…
Stakes are high as government plans exit from mortgage markets – The Washington Post
Keeping the mortgage rates at historic lows, which required a commitment of more than $1 trillion, was viewed within the administration as a central plank of the economic strategy last year, senior officials said. Though the policy did not attract as much attention as rescue efforts to bail out banks, it helped revitalize home buying in some parts of the country and put money in the pockets of millions of homeowners who were able to refinance into lower monthly payments, the officials added.
West Coast Wasteland – The Nation
There’s a Mad Max feel to daily life in many neighborhoods. The Central Valley has a swath of cities whose home foreclosure rates rank in the top ten in the country. Friends looking to buy a home in a poor part of Sacramento tell me of foreclosed houses stripped of their copper wires, their toilets, their pipes, even their drywall. An ex-student reports visiting homes in which furious foreclosed owners and evicted tenants have urinated and defecated on the carpeting, abandoned pets to starve, left kitchens filled with rotting food. Sure, you can buy these properties for next to nothing, but you’ll have to bring in the biohazard squads before you can safely occupy them.
Huge N.Y. Housing Complex Is Returned to Creditors – The New York Times
The decision by Tishman Speyer Properties and BlackRock Realty comes four years after the $5.4 billion purchase of the complexes’ 110 buildings and 11,227 apartments in what was the most expensive real estate deal of its kind in American history.
Central banks, debt and deflation – The Economist
WHY are central banks so scared of deflation? The answer might seem obvious when one thinks back to the 1930s and the Great Depression. But the 19th century had quite long periods of deflation, many of which turned out to be fairly benign; deflation was a natural occurrence in an agricultural economy where crop prices were highly volatile.
Why You Can Yawn Over Monday’s Home Sales ‘Shock’ – The Wall Street Journal
Memo for Monday morning: Don’t get excited.
The National Association of Realtors is due to release its monthly report on existing home sales at 10 a.m. Monday, and it’s likely to look lousy. (What’s with this “existing” home sales bit? New homes don’t exist? Let’s call it home resales.) Analysts are predicting a sharp drop from November’s level. The knee-jerk reaction probably will be: Oh, no, the housing market is in free fall again!
Why Is California Broke? – Mish
Underwater, but Will They Leave the Pool? – The New York Times
An important implication is that we could be facing another wave of foreclosures, spurred less by spells of unemployment and more by strategic thinking. Research shows that bankruptcies and foreclosures are “contagious.” People are less likely to think it’s immoral to walk away from their home if they know others who have done so. And if enough people do it, the stigma begins to erode.
