BloggingStocks http://www.bloggingstocks.com BloggingStocks http://www.blogsmithmedia.com/http://www.bloggingstocks.com/media/feedlogo.gif BloggingStocks http://www.bloggingstocks.com en-us Copyright 2012 Weblogs, Inc. The contents of this feed are available for non-commercial use only. Blogsmith http://www.blogsmith.com/<![CDATA[Bank Failures Hit 42, Expected to Exceed 2009's 140]]>http://www.bloggingstocks.com/2010/04/12/bank-failures-hit-42-expected-to-exceed-2009/http://www.bloggingstocks.com/2010/04/12/bank-failures-hit-42-expected-to-exceed-2009/http://www.bloggingstocks.com/2010/04/12/bank-failures-hit-42-expected-to-exceed-2009/#commentsFiled under: , ,

Friday marked the failure of another bank, pushing the 2010 total to 42. The Federal Deposit Insurance Corporation took over Beach First National Bank in Myrtle Beach, South Carolina.

The bank had $585.1 million in assets and $516 in deposits. Bank of North Carolina, based in Thomasville, is taking over the failed bank's assets and deposits. The Beach First failure is expected to cost the FDIC $130.3 million.

A growing number of loan defaults, especially in the commercial real estate sector, have put considerable pressure on banks across the country. In fact, failures are expected to peak this year, exceeding the 140 that occurred in 2009, which was the worst year since 1992.

Continue reading Bank Failures Hit 42, Expected to Exceed 2009's 140

Bank Failures Hit 42, Expected to Exceed 2009's 140 originally appeared on BloggingStocks on Mon, 12 Apr 2010 09:00:00 EST. Please see our terms for use of feeds.

Read | Permalink | Email this | Comments]]>bank failurebank failuresbankingbanksBeach First National Bankcommercial real estatedefaultsFDICFederal Deposit Insurance Corporationinthenewsmortgagemortgage defaultsmortgagesreal estateMon, 12 Apr 2010 09:00:00 EST<![CDATA[Four reasons we're stuck with high unemployment for a while]]>http://www.bloggingstocks.com/2009/10/20/four-reasons-were-stuck-with-high-unemployment-for-a-while/http://www.bloggingstocks.com/2009/10/20/four-reasons-were-stuck-with-high-unemployment-for-a-while/http://www.bloggingstocks.com/2009/10/20/four-reasons-were-stuck-with-high-unemployment-for-a-while/#commentsFiled under: , , ,

Some of the jobs that have disappeared through this recession are gone forever, it seems. Even when the market turns, and even gains momentum, we could be stuck with a fairly weak employment market for a while. The recovery will take longer than we'd like, putting more distance between now and the top of the next market run. We've lost 7.2 million jobs since December 2007, and the predictions of some economists that we'll get them back by 2014 may actually seem optimistic.

Unemployment is at 9.8%, and it's expected to clear 10% early next year. Then, we have the specter of a jobless recovery with which to contend. "Full employment" is often considered to be an unemployment rate of 4% to 5%, but it could be a while before we get there. The last downturn, following the dotcom bust, resulted in a peak unemployment rate of 6.3% in 2003 ... and we're already well past that.

Why is the recovery going to be such a grind? Check out the four major reasons after the jump.

Continue reading Four reasons we're stuck with high unemployment for a while

Four reasons we're stuck with high unemployment for a while originally appeared on BloggingStocks on Tue, 20 Oct 2009 15:00:00 EST. Please see our terms for use of feeds.

Read | Permalink | Email this | Comments]]>bank loansBankLoansbanksconsumer spendingConsumerSpendingdotcomeconomic growthEconomicGrowthfeaturedforeclosedforeclosureforeclosuresjobjob cutsJobCutsjobless ratejobless recoveryJoblessRateJoblessRecoveryjoblossesjobsmortgagemortgage defaultsMortgageDefaultsmortgagesunemploymentunemployment rateUnemploymentRateTue, 20 Oct 2009 15:00:00 EST<![CDATA[Citigroup announces mortgage help, will it help the stock at all?]]>http://www.bloggingstocks.com/2009/03/03/citigroup-announces-mortgage-help-will-it-help-the-stock-at-all/http://www.bloggingstocks.com/2009/03/03/citigroup-announces-mortgage-help-will-it-help-the-stock-at-all/http://www.bloggingstocks.com/2009/03/03/citigroup-announces-mortgage-help-will-it-help-the-stock-at-all/#commentsFiled under:

This morning, Citgroup (NYSE: C) announced a new initiative that it expects will help the recently unemployed mortgage customers that have fallen behind in their payments. The goal is to keep these customers in their homes by reducing their monthly mortgage payment for three months.

Who is eligible for this program? Borrowers with first mortgages whose loans are owned and serviced by CitiMortage. The borrowers also have to meet other guidelines to be eligible for program participation.

According to Citigroup, the required monthly payment for most qualifying customers will be roughly $500 per month.

Continue reading Citigroup announces mortgage help, will it help the stock at all?

Citigroup announces mortgage help, will it help the stock at all? originally appeared on BloggingStocks on Tue, 03 Mar 2009 09:20:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>ccitigrouphomeownersinthenewsmortgage defaultsMortgageDefaultsmortgagesTue, 03 Mar 2009 09:20:00 EST<![CDATA[Seven reasons the market is not going up any time soon: #2 The next mortgage tsunami]]>http://www.bloggingstocks.com/2009/01/26/seven-reasons-the-market-is-not-going-up-any-time-soon-2-the-n/http://www.bloggingstocks.com/2009/01/26/seven-reasons-the-market-is-not-going-up-any-time-soon-2-the-n/http://www.bloggingstocks.com/2009/01/26/seven-reasons-the-market-is-not-going-up-any-time-soon-2-the-n/#commentsFiled under: , , ,

Subprime mortgage defaults peaked and will slowly begin to slide during the next two years.

But don't get excited -- option ARMs and ALT-A mortgages are now beginning to rise at a very rapid rate. According to analysts I follow, notably Ivy Zelman, the next tsunami will be larger than the one we just went through.

And the banks are not currently valuing these mortgages as if they will default at this rate.

Be sure to read all 7 reasons the stock market isn't going up any time soon.

Michael Shulman is a contributor to OptionsZone.com.

Seven reasons the market is not going up any time soon: #2 The next mortgage tsunami originally appeared on BloggingStocks on Mon, 26 Jan 2009 11:33:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>alt-aloan defaultsLoanDefaultsmichael shulmanMichaelShulmanmortgagemortgage crisismortgage defaultsMortgageCrisisMortgageDefaultsmortgagesoption ajustable rate mortgagesoption armsOptionAjustableRateMortgagesOptionArmsstock market nightmareStockMarketNightmaresubprimesubprime loanssubprime mortgagesSubprimeLoansSubprimeMortgagesMon, 26 Jan 2009 11:33:00 EST<![CDATA[Next target for fear mongers: Credit cards]]>http://www.bloggingstocks.com/2008/12/01/next-target-for-fear-mongers-credit-cards/http://www.bloggingstocks.com/2008/12/01/next-target-for-fear-mongers-credit-cards/http://www.bloggingstocks.com/2008/12/01/next-target-for-fear-mongers-credit-cards/#commentsFiled under: , ,

Banking analyst Meredith Whitney is credited with questioning assets on bank balance sheets given the collapse in the real estate market.

Taking advantage of a complete lack of information, Ms. Whitney triggered a massive collapse of trust in an industry by claiming that mortgage-backed securities were worth far less than what the market had perceived.

While she may have had a basis for her claims, her assessment was more sensational than factual. Mortgage-backed securities are quite complex instruments whereby loans are sliced, diced and packaged for sale to a global market.

With maturities extending 30 years into the future, it is unreasonable and unfair to assume that paybacks, even with high default rates will amount to what is currently priced into the market.

The lack of understanding of the underlying security or loans at the individual level has created uncertainty that has yet to be resolved.

For fans of the original "Star Wars" movie, think of the weakness in terms of attacking the Death Star. That one hole was exploited (we can debate the merits of doing so later) by Ms. Whitney and those like her.

Continue reading Next target for fear mongers: Credit cards

Next target for fear mongers: Credit cards originally appeared on BloggingStocks on Mon, 01 Dec 2008 17:00:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>capital onecapital one financialCapitalOneCapitalOneFinancialCOFcreditcredit cardscredit marketsCreditCardsCreditMarketsMeredith WhitneyMeredithWhitneymortgage backed securitiesmortgage defaultsMortgageBackedSecuritiesMortgageDefaultsMon, 01 Dec 2008 17:00:00 EST<![CDATA[Congress may have to approve a 'TARP 2,' economist says]]>http://www.bloggingstocks.com/2008/11/21/congress-may-have-to-approve-a-tarp-2-economist-says/http://www.bloggingstocks.com/2008/11/21/congress-may-have-to-approve-a-tarp-2-economist-says/http://www.bloggingstocks.com/2008/11/21/congress-may-have-to-approve-a-tarp-2-economist-says/#commentsFiled under: , , ,

With credit markets remaining under stress, and with uncertainty growing regarding the status of megabank Citigroup (NYSE: C), the U.S. Congress may have to take more action to maintain financial system stability and prevent the U.S. economy from spiraling into a deeper recession, so says economist David H. Wang.

"The U.S. Congress may have to approve a 'TARP 2,'" Wang told BloggingStocks Friday. "Whether Congress does it as part of a fiscal stimulus package, or separately, it is clear we will need more money to purchase toxic assets, improve bank capitalization and allocate funds for home mortgage refinance programs, and other financial stabilization measures. At this stage of the crisis, the $700 billion TARP is not going to be enough, in my interpretation."

Bank sector stress remains

Wang said that if Citigroup, whose CEO Vikram Pandit said has adequate capital, for some reason cannot, when needed, find additional capital in the private sector, then "the Fed and or U.S. Treasury will step in, and take necessary measures to stabilize the bank," Wang said. If the U.S. Treasury is the primary funder, "that action, and other forthcoming, planned actions by the Treasury may use up a considerable amount of TARP funds, requiring a TARP 2."

Continue reading Congress may have to approve a 'TARP 2,' economist says

Congress may have to approve a 'TARP 2,' economist says originally appeared on BloggingStocks on Fri, 21 Nov 2008 16:35:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>banking sectorbankscommercial mortgage backed securitiesCongressdefaultsFedfiscal stimulusinthenewsmortgage defaultsTARPU.S. Federal ReserveU.S. TreasuryFri, 21 Nov 2008 16:35:00 EST<![CDATA[Pearlstein: Who to blame for the financial crisis]]>http://www.bloggingstocks.com/2008/10/14/pearlstein-its-easy-to-identify-who-to-blame-in-this-financial/http://www.bloggingstocks.com/2008/10/14/pearlstein-its-easy-to-identify-who-to-blame-in-this-financial/http://www.bloggingstocks.com/2008/10/14/pearlstein-its-easy-to-identify-who-to-blame-in-this-financial/#commentsFiled under: , , ,

Washington Post Business Columnist Steven Pearlstein does not 'hold it all in,' as they say, regarding who he thinks is most to blame for the financial crisis.

Pearlstein cites the ineptitude of Wall Street and the nation's financial regulators. The crisis would have occurred whether Lehman Brothers was saved or not, because bad debt had overwhelmed the global financial system. A government intervention was inevitable, essential, and an act of leadership, in Pearlstein's view.

Conversely, Wall Street's top executives have shown little leadership, if any, he said. Their silence and invisibility throughout the crisis "attests to their moral and political bankruptcy," Pearlstein said, a perfect match for the financial bankruptcy they caused for investors, creditors, and customers.

Further, Pearlstein is particularly angered by Wall Street's top executives unwillingness to commit to a plan to enable borrowers to refinance mortgages into government guaranteed mortgages set at 85% of current market value of the property, and at the executives' utter lack of comment before the cameras, particularly regarding credit lines to businesses.

Political & Economic Analysis: Columnist Pearlstein clearly lays the blame for the financial crisis at the feet of Wall Street's top officials. Still, the mortgage process -- and the failure of a substantial portion of the subprime/Alt-A mortgage market -- involved many players: bank executives/lenders, mortgage brokers, appraisers, securitization specialists, ratings agencies, and borrowers.

Continue reading Pearlstein: Who to blame for the financial crisis

Pearlstein: Who to blame for the financial crisis originally appeared on BloggingStocks on Tue, 14 Oct 2008 12:35:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>Alt Aappraisersbank rescuebanking sectorbanksborrowershome pricesinthenewsmedian home pricesmortgage backed securitiesmortgage defaultsmortgagesratings agenciesSteven PearlsteinsubprimeU.S. CongressU.S. TreasuryTue, 14 Oct 2008 12:35:00 EST<![CDATA[FDIC may have to add cash to replenish insurance fund]]>http://www.bloggingstocks.com/2008/08/11/fdic-may-have-to-add-cash-to-replenish-insurance-fund/http://www.bloggingstocks.com/2008/08/11/fdic-may-have-to-add-cash-to-replenish-insurance-fund/http://www.bloggingstocks.com/2008/08/11/fdic-may-have-to-add-cash-to-replenish-insurance-fund/#commentsFiled under: , ,

IndyMac Bancorp.'s failure, along with the failure of seven other banks this year, has erased 17% from an FDIC insurance fund, and will likely propel an increase in insurance fund premiums, Bloomberg News reported Monday.

IndyMac may cost the fund $4-8 billion, in addition to $1.16 billion in earlier bank foreclosure costs, Bloomberg News reported Monday. Premiums for the deposit insurance fund are likely to rise, an FDIC official said.

Economist Peter Dawson said Monday a premium increase would represent the most prudent course for the FDIC.

"Needless to say, given the bank failures, this doesn't come as a surprise or a shock. The FDIC could have explored other funding options, but given the scope of the insurance funds claims, a premium increase would make the most sense at this time," Dawson said.

The FDIC is required to replenish the fund when the reserve ratio, or the balance divided by insured deposits, slips below 1.15%, Dawson said.

Continue reading FDIC may have to add cash to replenish insurance fund

FDIC may have to add cash to replenish insurance fund originally appeared on BloggingStocks on Mon, 11 Aug 2008 10:25:00 EST. Please see our terms for use of feeds.

Read | Permalink | Email this | Comments]]>bank failuresbanking sectorbanksBush AdministrationFDICFederal Deposit Insurance CorporationIndyMacinthenewsmortgage defaultsmortgagesU.S. CongressMon, 11 Aug 2008 10:25:00 EST<![CDATA[Rising Dow, or Pyrrhic Dow?]]>http://www.bloggingstocks.com/2008/08/09/rising-dow-or-pyrrhic-dow/http://www.bloggingstocks.com/2008/08/09/rising-dow-or-pyrrhic-dow/http://www.bloggingstocks.com/2008/08/09/rising-dow-or-pyrrhic-dow/#commentsFiled under: , , , ,

Those investors/readers who are of the persuasion that the U.S. stock market is about turn the corner should heed the words of caution from legendary banker Bill Seidman.

"There's always a chance of a large bank failure," Seidman told Newsweek. Seidman chaired the Resolution Trust Corporation, the federally-created liquidator for the last banking crisis in the 1980s.

Keep an eye on the big banks

A large bank failure would quickly extinguish what little momentum the market has established from mid July to early August, during which the Dow Jones Industrial Average has risen from about 10,850 to 11,734. Economist David H. Wang said he will not attach a more-positive descriptive to the 884-point move, because he "doesn't want to create unreasonable, and unjustified, expectations."

"First, our technical analyst friends would say the recent move up is still well within the range of a bear market correction," Wang said. "Second, from a fundamental standpoint, we still have major headwinds."

Continue reading Rising Dow, or Pyrrhic Dow?

Rising Dow, or Pyrrhic Dow? originally appeared on BloggingStocks on Sat, 09 Aug 2008 12:40:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>Bill Seidmanbond marketcpicredit marketsdisposable incomeforeclosuresgasoline pricesgdphousinginflationmedian home pricesmortgage defaultsoil pricesoil shockResolution Trust CorporationRTCSeidmanU.S. economySat, 09 Aug 2008 12:40:00 EST<![CDATA[Will a new U.S. president lead to a new mortgage system?]]>http://www.bloggingstocks.com/2008/07/30/will-a-new-u-s-president-lead-to-a-new-mortgage-system/http://www.bloggingstocks.com/2008/07/30/will-a-new-u-s-president-lead-to-a-new-mortgage-system/http://www.bloggingstocks.com/2008/07/30/will-a-new-u-s-president-lead-to-a-new-mortgage-system/#commentsFiled under: , , , ,

Most Americans realize that every new U.S. president, upon taking the oath of office, faces his/her share of economic problems, none of which originated on his watch.

President John F. Kennedy spoke to this when he said (and someone said it before him), "It's true. Life is not fair. Some men go to war, and others remain at home. Among those who go to war, some men are sent to the front lines, while others stay behind. It's true. Life is not fair."

Still, although each age has seen its share of formidable economic problems, the scope, seriousness, and systemic impact of economic problems facing the new president, be it Democrat Barack Obama or Republican John McCain, may represent the biggest economic decisions since those President Franklin D. Roosevelt confronted upon taking office in the depths of the Great Depression in 1933.

What's one issue likely to give the president more gray hair? The kinds of systemic reforms to lobby for, on the heels of the federal housing bailout of Fannie Mae (NYSE: FNM) and Freddie Mac (NYSE: FRE) following the collapse of the housing market and rise in mortgage defaults, said economist David H. Wang. The housing bailout will further increase the U.S Government's annual budget deficit, which is expected to reach $490 billion in Fiscal 2009, Wang said.

Continue reading Will a new U.S. president lead to a new mortgage system?

Will a new U.S. president lead to a new mortgage system? originally appeared on BloggingStocks on Wed, 30 Jul 2008 16:55:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>banksbond marketbudget deficitcredit marketsFDRforeclosuresgdpGreat DepressionGreatDepressionhousinghousing bailoutinthenewsMcCainmortgage defaultsmortgage lendersmortgagesObamaPaulsonU.S. CongressU.S. economyU.S. TreasuryWed, 30 Jul 2008 16:55:00 EST<![CDATA[Consumer, lender groups seen scrutinizing Fed's new mortgage rules]]>http://www.bloggingstocks.com/2008/07/09/consumer-lender-groups-seen-scrutinizing-feds-new-mortgage-rul/http://www.bloggingstocks.com/2008/07/09/consumer-lender-groups-seen-scrutinizing-feds-new-mortgage-rul/http://www.bloggingstocks.com/2008/07/09/consumer-lender-groups-seen-scrutinizing-feds-new-mortgage-rul/#commentsFiled under: , , , ,

The U.S. Federal Reserve will issue new rules next week aimed at protecting future homebuyers from questionable lending practices.

Fed Chairman Ben Bernanke provided a preview of the Fed's new rules during a speech Tuesday at the FDIC Forum on Mortgage Lending for Low/Moderate Income Households in Arlington, Va. Under the Fed's authorities, the Home Ownership and Equity Protection Act, the rules -- which will apply to all lenders, not just banks -- are expected to, among other reforms:
  • Restrict lenders from penalizing high-risk borrowers who pay off loans early.
  • Bar lenders from making loans without proof of a borrower's income.
  • Require lenders to make sure that borrowers set aside money to pay for taxes and insurance.
'Front end' / 'back end' ratios deemed key

Economist Peter Dawson told BloggingStocks he's taking "a wait-and-see approach" regarding the Fed's mortgage regulation revisions. "This set of revised regulations could be, arguably, the most important federal regulation change, in financial terms, since the last plan to maintain the solvency of the Social Security trust fund," Dawson said.

Continue reading Consumer, lender groups seen scrutinizing Fed's new mortgage rules

Consumer, lender groups seen scrutinizing Fed's new mortgage rules originally appeared on BloggingStocks on Wed, 09 Jul 2008 16:44:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>banking sectorbanksBernankecredit scoresdefaultsFedFICO scoresforeclosuresinthenewslendersmedian home pricesmortgage bankersmortgage defaultsmortgage regulationsmortgagesU.S. Federal ReserveWed, 09 Jul 2008 16:44:00 EST<![CDATA[Martin Wolf: We need a mortgage system where banks, lenders have skin in the game]]>http://www.bloggingstocks.com/2008/05/07/martin-wolf-we-need-a-mortgage-system-where-banks-lenders-have/http://www.bloggingstocks.com/2008/05/07/martin-wolf-we-need-a-mortgage-system-where-banks-lenders-have/http://www.bloggingstocks.com/2008/05/07/martin-wolf-we-need-a-mortgage-system-where-banks-lenders-have/#commentsFiled under: , ,

The ever-incisive FT columnist Martin Wolf offers prudent and timely advice concerning the reforms needed to ease credit market doldrums and right the global financial state of things.

One key practice Wolf would like to see addressed is bank / mortgage lender selling of mortgages they originate.

Designers of the practice had good intentions: It was designed to free-up capital so banks / mortgage lenders could have more money available for future homebuyers. A noble intention.

Unfortunately, as tradition reminds us, the road to perdition (and record housing sector slumps) is paved with good intentions. The problem, Wolf notes, is that the originate-and-distribute model encouraged banks / mortgage lenders to originate (in many cases for handsome fees) high-risk, very-poor-credit-quality mortgages with reckless abandon, because originators knew that the loan would be sold, and its status as a performing asset would be entirely someone else's problem. Save the best (mortgages), get rid of the rest.

It's not surprising, Wolf notes, that the originate-and-distribute model became laden with sloppy, irresponsible and even fraudulent loans. Wolf's reform: originators must be required to retain a portion of the equity of securitized loans. Hence, if / when they go bad, the originator loses money too.

Economic Analysis: Wolf's proposed financial / bond market reform is on the mark. If every party, including the originator, has a stake in a mortgage's repayment status, that will lead to higher-quality loans, while at the same time retaining the secondary market's benefit of freeing-up capital for new mortgages.

Martin Wolf: We need a mortgage system where banks, lenders have skin in the game originally appeared on BloggingStocks on Wed, 07 May 2008 17:44:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>banking sectorbanksbond marketcredit crisiscredit crunchdefaultshousinghousing sectorinthenewsmortgage backed securitiesmortgage defaultsmortgage lendersmortgagessubprimesubprime mortgagesWed, 07 May 2008 17:44:00 EST<![CDATA[Merrill Lynch's John Thain: Credit crisis getting better]]>http://www.bloggingstocks.com/2008/05/07/merrill-lynchs-john-thain-credit-crisis-getting-better/http://www.bloggingstocks.com/2008/05/07/merrill-lynchs-john-thain-credit-crisis-getting-better/http://www.bloggingstocks.com/2008/05/07/merrill-lynchs-john-thain-credit-crisis-getting-better/#commentsFiled under: , ,

Merrill Lynch and Co., Inc. (NYSE: MER) CEO John Thain said today that the risk in the housing market is "much lower" than it has been recently as the credit crisis in the U.S. is "getting better." Leave it to the leader of a company which has written off over $30 billion in mortgage lending investment to make this claim. But the thing is, could he be right?

Although Thain said "economic pressure" will remain high over the next year, he expressed confidence that the end of the housing bubble, which is still popping in many parts of the country, is now in sight. Thain also indicated that food prices and shortages as well as higher unemployment will continue to have an impact on the U.S. economy. Of course Merrill has had three quarters of disastrous results like other large investment banks, and the company is still toiling with the idiocy of incredibly risky investments that have left it weakened financially.

Even if Thain had been hired by Citigroup, Inc. (NYSE: C) last year, he'd be in the same mess in the same industry. I'm not sure what "much lower" risk in the housing market means, although he's probably talking about his company's reduced exposure to those SIVs and other vehicles from the Flintstone era that start off fast before the wheels fall off.

I hope Thain is correct in his assessments, and Merrill Shareholders are probably wanting the same thing, just much more badly than myself.

Merrill Lynch's John Thain: Credit crisis getting better originally appeared on BloggingStocks on Wed, 07 May 2008 11:42:00 EST. Please see our terms for use of feeds.

Read | Permalink | Email this | Comments]]>credit crisisCreditCrisisinthenewsJohn thainJohnThainMERmerrill lynchMerrillLynchmortgage backed secu...mortgage defaultsmortgage ratesMortgageBackedSecu...MortgageDefaultsMortgageRatesmortgagesWed, 07 May 2008 11:42:00 EST<![CDATA[Ben Stein: Perhaps the market isn't always right]]>http://www.bloggingstocks.com/2008/04/28/ben-stein-perhaps-the-market-isnt-always-right/http://www.bloggingstocks.com/2008/04/28/ben-stein-perhaps-the-market-isnt-always-right/http://www.bloggingstocks.com/2008/04/28/ben-stein-perhaps-the-market-isnt-always-right/#commentsFiled under: , ,

The perceptive and common sense-rooted Ben Stein, in a business column in The New York Times, has weighed-in on the credit crisis, and for market absolutists, it's an argument they probably don't want to hear.

Stein, like many of us, has pondered how the massively well-paid men and women of Wall Street could create such a catastrophe. How did some of the smartest, talented executives, Stein ruminates, generate such immense losses that "they made banks clam up on lending -- at great risk to the economy?"

Compelling questions

Stein asks: Where were the fail-safe devices? The government watchdogs? The ratings agencies? A speech by Greenlight Capital hedge fund manager David Einhorn at a Grant's Interest Rate Observer event, provided the answers -- the unfortunate truths of the recent housing/credit boom -- which Stein summarized:

Continue reading Ben Stein: Perhaps the market isn't always right

Ben Stein: Perhaps the market isn't always right originally appeared on BloggingStocks on Mon, 28 Apr 2008 17:24:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>asset backed securitiesbank sectorBen Steinbond marketcredit crisiscredit crunchcredit marketsDavid EinhornderivativesEinhornGreenlight Capitalhousinginvestment banksKeynesiansleveragemonetaristsmortgage backed securitiesmortgage defaultsNew York TimesSECSecurities and Exchange CommissionSteinMon, 28 Apr 2008 17:24:00 EST<![CDATA[Martin Wolf: 'Heads I win, tails you lose' financial incentives must stop]]>http://www.bloggingstocks.com/2008/03/27/martin-wolf-heads-i-win-tails-you-lose-financial-incentives/http://www.bloggingstocks.com/2008/03/27/martin-wolf-heads-i-win-tails-you-lose-financial-incentives/http://www.bloggingstocks.com/2008/03/27/martin-wolf-heads-i-win-tails-you-lose-financial-incentives/#commentsFiled under: , , ,

Financial eras, like social periods, are often defined by moments or epiphanies when decision makers and/or citizens realized that a serious flaw/mistake/problem was occurring through time, and across space, and needed to be corrected.

The ever-incisive FT columnist and economist Martin Wolf describes one contemporary concern that's likely to be addressed: the failure to align the interests of managers with those of investors.

My BloggingStocks colleagues Peter Cohan and Zac Bissonnette have also written on the subject on several occasions in this space, and now the FT's Wolf has assembled additional data that may very well lead to public policy changes, both in Wolf's United Kingdom and in the United States.

Continue reading Martin Wolf: 'Heads I win, tails you lose' financial incentives must stop

Martin Wolf: 'Heads I win, tails you lose' financial incentives must stop originally appeared on BloggingStocks on Thu, 27 Mar 2008 15:59:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>Bank of Englandbanking sectorbanksBerkshire HathawayBRK.ABuffettcredit crisiscredit crunchexecutive compensationfeeshedge fundsinvestment feesinvestorsMartin Wolfmortgagemortgage defaultsmortgage lendersperformance feesshareholdersstock optionssubprime mortgagestaxpayersU.S. Federal ReserveUnited KingdomUnited StatesWarren BuffettWolfThu, 27 Mar 2008 15:59:00 EST<![CDATA[Proposed, higher conforming mortgage limits seen aiding housing sector]]>http://www.bloggingstocks.com/2008/01/31/proposed-higher-conforming-mortgage-limits-seen-aiding-housing/http://www.bloggingstocks.com/2008/01/31/proposed-higher-conforming-mortgage-limits-seen-aiding-housing/http://www.bloggingstocks.com/2008/01/31/proposed-higher-conforming-mortgage-limits-seen-aiding-housing/#commentsFiled under: , , ,

The $150 billion fiscal stimulus package that's winding its way through the U.S. Congress will not represent a panacea for the U.S.'s economic ills, an economist argued, but it will represent modest good news for one segment -- the beleaguered housing sector.

The fiscal stimulus bill currently under discussion in the U.S. Senate calls for raising Fannie Mae and Freddie Mac's conforming loan limit to $729,750 through 2008 from the current $417,000.

Conforming loans are conventional, fixed-rate mortgages for good credit borrowers that banks make that are eligible for purchase by Fannie Mae (NYSE: FNM) and Freddie Mac (NYSE: FRE). When Freddie and Fannie purchase these loans from banks, it "frees-up" money that the banks can use to grant mortgages to future borrowers, thus expanding the pool of funds available for mortgages.

Economist Steve Affinito told BloggingStocks Thursday that while it's important to underscore that the higher conforming loan ceiling will not eliminate the U.S. housing sector's recession, it is "a critical, essential step in the right direction," in his interpretation.

Continue reading Proposed, higher conforming mortgage limits seen aiding housing sector

Proposed, higher conforming mortgage limits seen aiding housing sector originally appeared on BloggingStocks on Thu, 31 Jan 2008 15:00:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>bond marketBushBushAdministrationconfrorming loansConfrormingLoanscredit marketsFannie Maefiscal policyFNMforeclosuresFREFreddie Machousinghousing sectorHousingSectorinterest ratesinthenewsmortgage defaultsmortgagesU.S. CongressU.S. TreasuryThu, 31 Jan 2008 15:00:00 EST<![CDATA[Dow reverses after word of banks, NY regulator meeting on bond insurer rescue]]>http://www.bloggingstocks.com/2008/01/23/dow-reverses-after-word-of-banks-ny-regulator-meeting-on-bond-i/http://www.bloggingstocks.com/2008/01/23/dow-reverses-after-word-of-banks-ny-regulator-meeting-on-bond-i/http://www.bloggingstocks.com/2008/01/23/dow-reverses-after-word-of-banks-ny-regulator-meeting-on-bond-i/#commentsFiled under: , ,

Key regulators at the New York State Insurance Department met Wednesday with U.S. banks to discuss raising new capital for bond insurers, a department spokesman said, Bloomberg News reported late Wednesday afternoon.

Talks in New York with unnamed banks are part of New York Insurance Superintendent Eric Dinallo's effort to stabilize the bond guarantors and bolster the market's financial condition, New York State Insurance Department spokesman Andrew Mais told Bloomberg News.

Market rallies on insurer meeting

Word of the meeting sparked a remarkable 600-point reversal rally on Wall Street, with the Dow closing the day up 298.98 points to 12270.17. The Dow had been down more than 300 points earlier in the day. The broader markets also rallied.

Continue reading Dow reverses after word of banks, NY regulator meeting on bond insurer rescue

Dow reverses after word of banks, NY regulator meeting on bond insurer rescue originally appeared on BloggingStocks on Wed, 23 Jan 2008 19:50:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>ABKAmbacbond marketcredit marketsDJIAGDPhousingMBIMBIAMGICMGIC Investmentmortgage defaultsNew York State Insurance DepartmentPMIPMI Grouprecessionsubprime mortgagesU.S. economyWed, 23 Jan 2008 19:50:00 EST<![CDATA[George Soros says subprime crisis will end dollar-based credit expansion]]>http://www.bloggingstocks.com/2008/01/23/george-soros-says-subprime-crisis-will-end-dollar-based-credit-e/http://www.bloggingstocks.com/2008/01/23/george-soros-says-subprime-crisis-will-end-dollar-based-credit-e/http://www.bloggingstocks.com/2008/01/23/george-soros-says-subprime-crisis-will-end-dollar-based-credit-e/#commentsFiled under: , ,

George Soros Billionaire investor George Soros said a major casualty from the U.S. subprime crisis will be the 60-year reign of the dollar-based credit boom, which he says will come to an end, Bloomberg News reported Wednesday.

"The current crisis is not only the bust that follows the housing boom, it's basically the end of a 60-year period of continuing credit expansion based on the dollar as the reserve currency,'' Soros said in a debate today at the World Economic Forum in Davos, Switzerland, Bloomberg reported. "Now the rest of the world is increasingly unwilling to accumulate dollars.''

However, Soros was careful to point out that he believes the dollar is still the most important reserve currency in the world and will remain so, according to Bloomberg.

Continue reading George Soros says subprime crisis will end dollar-based credit expansion

George Soros says subprime crisis will end dollar-based credit expansion originally appeared on BloggingStocks on Wed, 23 Jan 2008 16:11:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>bond marketChinacredit marketsDavosdollarEUeuroEuropean UnionfeaturedGDPGeorge Sorosglobal economymonetary policymortgage defaultsrecessionSorosU.S. economyWorld Economic ForumyenWed, 23 Jan 2008 16:11:00 EST<![CDATA[Economist: 'Decoupling' thesis may be put on hold]]>http://www.bloggingstocks.com/2008/01/22/economist-decoupling-thesis-may-be-put-on-hold-for-awhile/http://www.bloggingstocks.com/2008/01/22/economist-decoupling-thesis-may-be-put-on-hold-for-awhile/http://www.bloggingstocks.com/2008/01/22/economist-decoupling-thesis-may-be-put-on-hold-for-awhile/#commentsFiled under: , , , , ,

Globe The global markets' sell-off that has resulted in more than a 5% decline in regional markets during the past two days has called into question a nascent theory regarding the global economy. Namely, that developing nations -- robust-growth economies in Asia, Latin America and Europe -- are "decoupled" from U.S. economic and financial conditions, with their growth rates independently achieved.

Markets from Tokyo to Shanghai to London slumped more than 5% over the past two days -- with some markets falling more than 7% -- on concerns that U.S. subprime mortgage and related asset defaults would send the U.S. economy into a recession. The Dow Jones Industrial Average today plunged more than 400 points in the initial hour of trading.

Amid the Dow's sell-off, the U.S. Federal Reserve, in an emergency monetary policy action, cut key interest rates Tuesday morning -- cutting both the Fed Funds rate and the discount rate by 75 basis points, setting the Fed Funds rate at 3.50% and the discount rate at 4.00%.

Continue reading Economist: 'Decoupling' thesis may be put on hold

Economist: 'Decoupling' thesis may be put on hold originally appeared on BloggingStocks on Tue, 22 Jan 2008 16:41:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>bond marketcredit marketsemerging marketsfeaturedFranceGDPGermanyglobalizationmortgage defaultsrecessionsubprime mortgagesU.S. economyUnited KingdomTue, 22 Jan 2008 16:41:00 EST<![CDATA[Paulson: Housing aid first, economic stimulus a close second]]>http://www.bloggingstocks.com/2008/01/07/paulson-housing-aid-first-economic-stimulus-a-close-second/http://www.bloggingstocks.com/2008/01/07/paulson-housing-aid-first-economic-stimulus-a-close-second/http://www.bloggingstocks.com/2008/01/07/paulson-housing-aid-first-economic-stimulus-a-close-second/#commentsFiled under: , , ,

U.S. Treasury Secretary Henry Paulson in a speech delivered Monday said the Bush Administration was weighing how to provide stimulus to the U.S. economy - - including a possible fiscal stimulus package - - but added that the administration does not want to rush a package.

Paulson, speaking at an event sponsored by the New York Society of Securities Analysts, said the administration's immediate goal is to minimize the impact of the housing correction on the U.S. economy.

Paulson said the nation was facing an "unprecedented wave" of 1.8 million subprime mortgages scheduled to reset to sharply higher rates, and underscored that the administration's negotiated deal with the mortgage industry to freeze selected mortgage rate five years will help the housing market recover, and avert a possible market failure.

Continue reading Paulson: Housing aid first, economic stimulus a close second

Paulson: Housing aid first, economic stimulus a close second originally appeared on BloggingStocks on Mon, 07 Jan 2008 17:56:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>economyFannie MaeFNMFREFreddie MacGDPHenry Paulsonhousinghousing sectormortgage defaultsmortgagesPaulsonrecessionsubprime mortgagesU.S. CongressU.S. economyU.S. Treasury DepartmentMon, 07 Jan 2008 17:56:00 EST