Financial Virus Permeates the System – Todd Harrison
As we navigate uncharted waters and sail through The Eye of the Financial Storm, an increasing number of people are weighing their options — and some of the smarter folks I know are “going dark.”
Mortgage Market Anticipates New QE – Zero Hedge
Of course, should the Fed recommence QE, which is now just a matter of politically self-destructive time, the spread will collapse, the 10 Year will plunge, and the administration will bankrupt all mortgage lenders (who are idiotic enough not to have been subsumed by the bankrupt GSE Borg) who will soon be forced to lend a 30 year mortgage at something around 3%. Alas, by the time the administration realizes that it does not matter what rate the mortgage is, and that the security of having a 1) cash flow and 2) job is far more important, and still as missing as always, it will be too late.
The Real Reason Banks Aren’t Lending – Naked Capitalism
What is required to drive lending is a creditworthy borrower on the other side of the bank lending officer’s desk, which means an employed borrower, whose income allows him to sustain regular repayments. Absent that, there will be no lending activity.
Fannie and Freddie’s Foreclosure Barons – Mother Jones
It involved something called an “assignment of mortgage,” the document that certifies who owns the property and is thus entitled to foreclose on it. Especially these days, the assignment is key evidence in a foreclosure case: With so many loans having been bought, sold, securitized, and traded, establishing who owns the mortgage is hardly a trivial matter. It frequently requires months of sleuthing in order to untangle the web of banks, brokers, and investors, among others. By law, a firm must execute (complete, sign, and notarize) an assignment before attempting to seize somebody’s home.
Personal Bankruptcies Rise, Reversing Trend – WSJ
Filings in July were also up 9% compared with the same month a year ago, and 2010 is on pace to record the largest number of consumer-bankruptcy filings in five years. Filings topped 1.4 million last year, the most since Congress revamped bankruptcy laws in 2005 to make it more difficult for consumers to shed debt.
The Housing Market Is On The Cliffs Of Insanity – Clusterstock
Consider the following. There are currently 3.99 million homes on the market for sale as of the end of June. Existing home sales were 5.37 million (seasonally adjusted annualized rate) in June, which equates to 8.9 months of supply. This is disingenuous, however, as June existing home sales represent April contract activity. We know that post-April pending homes sales are down over 30% through May and June. As such, we would expect a comparable decline in existing home sales once the data rolls through on a lag later this month. In other words, existing home sales for July/August will be in the ~4 million range, which will be a wake-up call to the Panglossian bulls. Assuming inventory remains around 4 million this will equate to ~12 months of supply. The market is often considered in equilibrium when inventory is 5-6 months of supply. For reference, 12 months will be the highest amount of supply seen since the housing downturn began. This 12 months figure does not include shadow inventory, which likely represents an additional 4.2 to 6.0 million homes (according to estimates from the Mortgage Bankers Association, the Federal Government’s HAMP Program, and Lender Processing Services, the largest mortgage default processor in the country.)
Weekly Initial Unemployment Claims increase to 479,000 – CR
This is the highest number of initial weekly claims since April.
Vancouver Home Sales Nosedive – FVREB (HT Patrick)
The Fraser Valley Real Estate Board (FVREB) processed 1,101 sales on its Multiple Listing Service (MLS®) in July, a decrease of 47 per cent compared to the 2,089 sales during the same month last year and down 39 per cent compared to June.
Squeezing the Rich Is a Poor Way to Spur Growth – Caroline Baum
The goal isn’t spending, or distributing other people’s money to create “aggregate demand.” That’s a wealth transfer, not a net stimulus. (Fiscal policy gets its punch from monetary policy, from the increase in the money supply to pay for the spending.)The goal should be to incentivize individuals to work hard, save and invest in the future. It’s about growing the pie.
More Workers Face Pay Cuts, Not Furloughs – NYT
The furloughs that popped up during the recession are being replaced by a highly unusual tactic: actual cuts in pay.
The Geography of High-Paying Jobs – The Atlantic
Housing price drop in county predicted – Sign On San Diego
County home prices will decline 9.6 percent in the first quarter of 2011 vs. the first quarter this year, says an analysis from Fiserv, which provides the data for the widely watched Case-Shiller Indexes.
The San Diego area is projected to have the 28th largest drop of the 384 markets surveyed. National home prices are expected to fall 4.9 percent in the same period.
