As I drove to work today it's amazing how many empty houses there along the road. Hiway 120 in Northern Calif. I can't believe these numbers are correct. Is it the same team that does the unemployment numbers.
jo6pac
The race to the bottom continues.
The Federal Open Market Committee will leave the benchmark interest rate at 2 percent today, ending the fastest series of reductions in two decades, according to all 102 economists surveyed by Bloomberg News.
Yesterday was the last day that big funds could wipe out their books so we had a down move yesterday. I think we trade mostly sideways to down until job numbers as people go through the funds trash bin and look for "value". Hence the rally in financials. of course if we move down below 1300 then look out below. Just my obervation...
Vital Part of Housing Bill Is Brainchild of Banks
Mortgage Aid Under 'Credit Suisse Plan' Would Benefit Lenders
By Jeffrey H. Birnbaum
Washington Post Staff Writer
Wednesday, June 25, 2008; D01
A key provision of the housing bill now awaiting action in the Senate -- and widely touted as offering a lifeline to distressed homeowners -- was initially suggested to Congress by lobbyists for major banks facing their own huge losses from the subprime mortgage crisis, according to congressional staff members and bank officials.
Credit Suisse, a large investment bank heavily invested in mortgage-backed securities, proposed allowing hundreds of thousands of homeowners to refinance their mortgages with lower-cost government-insured loans, relieving financial institutions of the troubled debt.
After the bank proposed this to Congress in January, it became known as the "Credit Suisse plan" among congressional staffers and lobbyists. It later formed the basis of housing provisions in both the House and Senate.
What a surprise that the USG is serving its real owners Bankrupters and Fraudsters of New York City. Fed had done its part earlier. A system of the Crooks...
A born-and-bred American dope is a bona fide economic slave with the delusion of being a master, or a free person.
I don't think we will rate hikes at all this year because wages are not increasing fast enough. If anything unemployment is going up. The Fed will jawbone the market all year and the poor and elderly will pay the cost.
Boss says my sick time account is getting too big. Not a problem. Wonder how many companies have seen a huge increase in calling in sick? I kind of like this new age of employment. Same pay, less expenses, more time to hang out with CR and Tanta.
Cancellations in a declining sales environment are cumulative. No doubt builders are attempting to resell cancelled homes from 2007. And that's if they are reporting correctly. Since builders are not supposed to report again previously contracted sales I wonder if they also market these properties as "not new homes." Sure, and the check is in the mail.
Yesterday was the last day that big funds could wipe out their books so we had a down move yesterday. I think we trade mostly sideways to down until job numbers as people go through the funds trash bin and look for "value". Hence the rally in financials. of course if we move down below 1300 then look out below. Just my obervation...
Just remember these investment funds have to drive up asset prices to pay the interest on their margin debt (since they have no other source of income with which to service the debt).
They don't have a choice but to figure out a way to drive up prices or they go bust like a watermelon thrown off the roof.
OT, but can someone provide details about what qualifications a distressed homeowner would need to qualify for an FHA government-guaranteed loan under the proposed housing bill? Can they be in default already? Do they have to come up with any cash (the way I read it they don't)? Are there any good estimates of the losses the banks will have to take on FHA refinanced loans (the way I see it the bank's new loan is for 85% of the current assessed value - does that mean they forfeit difference between the original loan amount and 85% of the current value?)
I am hoping for an UberNerd post in the fullness of time. Thanks.
"225 bps rate hike coming today. Remember you heard it here first."
Wouldn't that jack up the Libor rate? What is the saying
"Cutting off my nose to spite my face" Destroying commodity prices cannot spare broken business such as the airlines, automakers.
I read a long article linked at BR's BPicture today, and (among many other things) it said there was a ton of crude oil inventory.
Later clicking over to Yahoo finance, I see inventories are up. Who knew?!
I am amazed that in this "information age" there is so much information that does not make it out to the people. It is obviously there to see, someone did see it and write about it weeks ago, but somehow.... doesn't get through.
I know it's been said before, but sometimes, examples of it are so striking, I'm compelled to type about it.
CR,
How does the Census Bureau calculate new home sales again? If it is based on a 25% sampling and the industry has started to make dynamic changes (ie BKs and shuttering of offices), do you think the numbers are reliable now? Or, could it be, that these numbers are bad guesses of home sales based on assumptions formed during an upswing? Seems to me they are too high...
California Attorney General Jerry Brown sued Countrywide Financial Corp and two top officers on Wednesday to stop the mortgage loan company from allegedly perpetrating a scheme to "mass produce loans for sale on the secondary market."
--
"Still, the 453,000 units of inventory is below the levels of the last year, and it appears that even including cancellations, inventory is now falling."
Sales are falling lot faster than the inventory, CR. Starts and Permits are higher than the sales.
How could Inventory fall when Sales are lower than Completions? Are you still using the math that you used to "estimate" housing demand at 1.7M Annual Rate? Have you yet figured out what the real demand has been?
You do good data reporting, Dr, but you are very bad at conclusions and how bad things really are for the housing and the economy.
Lets speculate for a moment. What can the Fed fundamentally change at this point to help the stock market? The market has rallied on low rates then sold off on high prices. Prices come down, rates go up the market is at best stuck where we are today. Factor in economic fundamental deterioration and what do you have at years end?
Sales-Completions is not = to inventory delta. Inventory is only those houses looking to be sold; remember there are lots of properties abandoned and/or converted to rental.
It should be noted that 1980 wasn't really a recession year; the recession hit in 1981-2 in earnest. The housing crash generally precedes the economic workout. I wouldn't expect anything as ugly as the 81-82 recession (the Fed isn't actually -trying - to start one this time!), but we should see some seriously ugly numbers in the fall and winter.
I'd like to see a clear statement from the gov't that mortgagors and mortgagees can sink or swim on their own, a nice solid rate hike to scare the inflation away, a moratorium on civil and criminal investigations except for actual fraud, and a solid six month to nine month downturn. That would be a good thing. Otherwise, we can limp along for five years paying off other people's mortgages and fighting about who's to blame.
barely writes:
SKF & SRS holders are taking a severe beating today.
I am itching to get back into SKF (SRS continues to be a losing bet) once it drops below 110. It may not get back there, but I'm not touching it at these prices.
So is it all going to get better already?
rate cut or no rate cut that is the question.... or rate hike... that could be the question...
hummm.....
Second half recovery starts next week!
As I drove to work today it's amazing how many empty houses there along the road. Hiway 120 in Northern Calif. I can't believe these numbers are correct. Is it the same team that does the unemployment numbers.
jo6pac
The race to the bottom continues.
This just in from Briefing.com
The major indices extend their opening gains and get an additional boost on the release of a better-than-expected housing report.
Looks like the Fed Funds predictions have erased all the open mouth committee BS.
Federal Funds Rate Predictions: Current ::
Federal Reserve Bank of Cleveland
:: fed funds,federal funds rate,prediction
I warned not to put to much weight on those liars.
Anonymous writes:
Looks like the Fed Funds predictions have erased all the open mouth committee BS.
It did the desired effect, staved off the decline of the dollar for a while.
The Federal Open Market Committee will leave the benchmark interest rate at 2 percent today, ending the fastest series of reductions in two decades, according to all 102 economists surveyed by Bloomberg News.
Bernanke May Halt Rate Cuts, Shift Focus to Inflation (Update1) - Bloomberg.com
Come on when was the last time 102 economist were wrong...
The Federal Open Market Committee will leave the benchmark interest rate at 2 percent today, ending the fastest series of reductions in two decades, according to all 102 economists surveyed by Bloomberg News.
225 bps rate hike coming today.
Remember you heard it here first.
Yesterday was the last day that big funds could wipe out their books so we had a down move yesterday. I think we trade mostly sideways to down until job numbers as people go through the funds trash bin and look for "value". Hence the rally in financials. of course if we move down below 1300 then look out below. Just my obervation...
ac,
you really think so? it might be better long run but its going to hurt like a mofo if it happens....
Do these inventory figures included bank owned inventory? If not, they are materially much higher.
--
Help is on the way...
Vital Part of Housing Bill Is Brainchild of Banks
Mortgage Aid Under 'Credit Suisse Plan' Would Benefit Lenders
By Jeffrey H. Birnbaum
Washington Post Staff Writer
Wednesday, June 25, 2008; D01
A key provision of the housing bill now awaiting action in the Senate -- and widely touted as offering a lifeline to distressed homeowners -- was initially suggested to Congress by lobbyists for major banks facing their own huge losses from the subprime mortgage crisis, according to congressional staff members and bank officials.
Credit Suisse, a large investment bank heavily invested in mortgage-backed securities, proposed allowing hundreds of thousands of homeowners to refinance their mortgages with lower-cost government-insured loans, relieving financial institutions of the troubled debt.
After the bank proposed this to Congress in January, it became known as the "Credit Suisse plan" among congressional staffers and lobbyists. It later formed the basis of housing provisions in both the House and Senate.
...
Vital Part of Housing Bill Is Brainchild of Banks
What a surprise that the USG is serving its real owners Bankrupters and Fraudsters of New York City. Fed had done its part earlier. A system of the Crooks...
A born-and-bred American dope is a bona fide economic slave with the delusion of being a master, or a free person.
What a system!
Jas
I don't think we will rate hikes at all this year because wages are not increasing fast enough. If anything unemployment is going up. The Fed will jawbone the market all year and the poor and elderly will pay the cost.
Boss says my sick time account is getting too big. Not a problem. Wonder how many companies have seen a huge increase in calling in sick? I kind of like this new age of employment. Same pay, less expenses, more time to hang out with CR and Tanta.
Cancellations in a declining sales environment are cumulative. No doubt builders are attempting to resell cancelled homes from 2007. And that's if they are reporting correctly. Since builders are not supposed to report again previously contracted sales I wonder if they also market these properties as "not new homes." Sure, and the check is in the mail.
ac writes: "225 bps rate hike coming today. Remember you heard it here first."
You heard it here 2nd. Perfect move in a desparate situation: Supports U$D, jolts commodity longs, doesn't hurt borrowers much.
Yesterday was the last day that big funds could wipe out their books so we had a down move yesterday. I think we trade mostly sideways to down until job numbers as people go through the funds trash bin and look for "value". Hence the rally in financials. of course if we move down below 1300 then look out below. Just my obervation...
Just remember these investment funds have to drive up asset prices to pay the interest on their margin debt (since they have no other source of income with which to service the debt).
They don't have a choice but to figure out a way to drive up prices or they go bust like a watermelon thrown off the roof.
OT, but can someone provide details about what qualifications a distressed homeowner would need to qualify for an FHA government-guaranteed loan under the proposed housing bill? Can they be in default already? Do they have to come up with any cash (the way I read it they don't)? Are there any good estimates of the losses the banks will have to take on FHA refinanced loans (the way I see it the bank's new loan is for 85% of the current assessed value - does that mean they forfeit difference between the original loan amount and 85% of the current value?)
I am hoping for an UberNerd post in the fullness of time. Thanks.
"225 bps rate hike coming today. Remember you heard it here first."
Wouldn't that jack up the Libor rate? What is the saying
"Cutting off my nose to spite my face" Destroying commodity prices cannot spare broken business such as the airlines, automakers.
OT -- Jas will be happy; CR used the 'd' word in a post!
More on the Decline of the Exurban Lifestyle: "...this must feel like a depression..."
I sense it: CR is coming around!
I read a long article linked at BR's BPicture today, and (among many other things) it said there was a ton of crude oil inventory.
Later clicking over to Yahoo finance, I see inventories are up. Who knew?!
I am amazed that in this "information age" there is so much information that does not make it out to the people. It is obviously there to see, someone did see it and write about it weeks ago, but somehow.... doesn't get through.
I know it's been said before, but sometimes, examples of it are so striking, I'm compelled to type about it.
CR,
How does the Census Bureau calculate new home sales again? If it is based on a 25% sampling and the industry has started to make dynamic changes (ie BKs and shuttering of offices), do you think the numbers are reliable now? Or, could it be, that these numbers are bad guesses of home sales based on assumptions formed during an upswing? Seems to me they are too high...
FOMC only has about 25-50bps of potential upside movement to play with in order to keep the curve favorable for banks.
I still don't see any rate adjustments to the upside happening.
They will just continue saying A and doing B.
California Attorney General Jerry Brown sued Countrywide Financial Corp and two top officers on Wednesday to stop the mortgage loan company from allegedly perpetrating a scheme to "mass produce loans for sale on the secondary market."
Calif AG sues Countrywide over alleged loan scheme
| Reuters
LOL
SKF & SRS holders are taking a severe beating today.
barely writes:
SKF & SRS holders are taking a severe beating today.
barely | 06.25.08 - 11:37 am | #
Feels like a suckers' rally...but I've been wrong before.
CR,
Do you have a gut feeling or inner pondering as to how many months of supply there is for land?
SKF & SRS holders are taking a severe beating today.
I get the financials, but what's so great about the construction industry to drive SRS down?
--
"Still, the 453,000 units of inventory is below the levels of the last year, and it appears that even including cancellations, inventory is now falling."
Sales are falling lot faster than the inventory, CR. Starts and Permits are higher than the sales.
How could Inventory fall when Sales are lower than Completions? Are you still using the math that you used to "estimate" housing demand at 1.7M Annual Rate? Have you yet figured out what the real demand has been?
You do good data reporting, Dr, but you are very bad at conclusions and how bad things really are for the housing and the economy.
Jas
Lets speculate for a moment. What can the Fed fundamentally change at this point to help the stock market? The market has rallied on low rates then sold off on high prices. Prices come down, rates go up the market is at best stuck where we are today. Factor in economic fundamental deterioration and what do you have at years end?
Sales-Completions is not = to inventory delta. Inventory is only those houses looking to be sold; remember there are lots of properties abandoned and/or converted to rental.
It should be noted that 1980 wasn't really a recession year; the recession hit in 1981-2 in earnest. The housing crash generally precedes the economic workout. I wouldn't expect anything as ugly as the 81-82 recession (the Fed isn't actually -trying - to start one this time!), but we should see some seriously ugly numbers in the fall and winter.
I'd like to see a clear statement from the gov't that mortgagors and mortgagees can sink or swim on their own, a nice solid rate hike to scare the inflation away, a moratorium on civil and criminal investigations except for actual fraud, and a solid six month to nine month downturn. That would be a good thing. Otherwise, we can limp along for five years paying off other people's mortgages and fighting about who's to blame.
Dead wood doesn't grow that well.
barely writes:
SKF & SRS holders are taking a severe beating today.
I am itching to get back into SKF (SRS continues to be a losing bet) once it drops below 110. It may not get back there, but I'm not touching it at these prices.
"Otherwise, we can limp along for five years paying off other people's mortgages and fighting about who's to blame."
Sounds about right.
(See, eg, almost all current Congressional activity.)
ac-
wow.......just wow..
I can't see them doing that at all.
Hope they do but .....wow...
does that not put a fork in any earnings for these banks via the comm. bubble???
I still say they lower .25-.5
remember who they are serving...
Ciao
MS