WASHINGTON (Reuters) - The Federal Housing Administration will allow the new $8,000 first-time homebuyer tax credit to be applied directly toward home purchase costs when using an FHA-insured mortgage, the Department of Housing and Urban Development said on Friday.
The plan to "monetize" the tax credit up-front is aimed at more quickly stabilizing the housing market, HUD Secretary Shaun Donovan said in a statement.
But in detailed rules, the FHA will still require home buyers to provide a minimum 3.5 percent downpayment from other sources.
The $8,000 tax credit for first-time home buyers was created as a part of the Obama administration's $787 billion stimulus plan. Some private lenders already were allowing buyers to apply the credits directly toward purchase costs through special financing schemes.
With the FHA following in a similar vein, a significant portion of the first-time homebuyer market will have up-front access to the credits instead of waiting until tax returns are filed.
"What we're doing today will not only help these families to purchase their first home but will present an enormous benefit for communities struggling to deal with an oversupply of housing," Donovan said in a statement
FHA-insured loans, which largely have replaced the subprime mortgage market, now accounts for about 25 percent of new mortgages, senior HUD officials said, versus about 2 percent of the market two years ago. At this pace, the agency will insure some 2.2 million mortgages this year.
The National Association of Home Builders estimates that the $8,000 first-time homebuyer credit will stimulate 160,000 home sales across the United States -- 101,000 purchases from first-time buyers and another 59,000 purchases by existing homeowners who sold dwellings to first-time buyers.
May 29 (Bloomberg) -- U.S. business activity contracted at a faster pace than forecast this month as orders and employment dropped.
The Institute for Supply Management-Chicago Inc. said today its business barometer decreased to 34.9 from 40.1 in April. Readings below 50 signal a contraction.
The report ran counter to others this month that indicated manufacturing was starting to improve this quarter, perhaps signaling that Chicago’s proximity to the auto slump in neighboring Detroit may be affecting the entire Midwest. Still, private economists have scaled back forecasts for economic growth in the second half of the year.
The figures are “undoubtedly affected significantly by shutdowns in the ailing automotive industry,” Joshua Shapiro, chief U.S. economist at Maria Fiorini Ramirez Inc., said in a note to clients. “The rate of decline in manufacturing output will moderate in coming months.”
-- Maria Ramirez has quickly tried to put a nice green shoots spin on this one! It continues to amaze me what crap these economists and analysts are feeding the masses. Of course the masses don't read any of this stuff anyway.
So now we know the Fed and their minions are working like dogs to prop up long T-bond prices.
ednesday put the fear of God into them about higher mortgage rates, etc.
This is a good test of your belief system. If you believe the Fed has the power to prop up the whole yield curve below zero interest on the short end (QE), then sell or hold off buying TBT.
If you believe the Fed has limited resolve or ammo to prop the whole curve, buy or hold TBT.
I don't believe the Fed will support the whole curve. They may try to help 10-year awhile. But they can't hold up longer-term bonds, too. The whole world is watching and most of the world don't like QE in the first place.
The Obama administration took actions that averted a second Great Depression and now needs the American people to be patient as the recovery gathers steam, senior White House economic adviser Austan Goolsbee said.
Citizen Scotto (profile) wrote on Fri, 5/29/2009 - 7:28 am replyIgnore user
I don't even go to CR anymore, I just read hoocoodanode
Ke, For traffic, click thru and and time on site stats, it might help to have the CR website url within the hoocoodanode.org directory http://calculatedrisk.hoocoodanode.org...
or something along those lines.....that adwords revenue decline might make CR post less....
The reason the dollar is tanking at the same time long T bonds are rising is because the Fed is cashing out big chunks of bonds, and the entities being cashed out are dropping dollars like hot potatoes. Huge fund flows.
rich
The Fed has the power, but they still opt to use as little of it as possible. Nebbish that way. So we'll probably have a bit of a panic, and then when there are fewer people that have dry powder to move against them, they'll TCOB
I think I'd go with Ultimate Currency Fight (UCF). Not sure that it qualifies as the first one either. (There's articles about silver inflating against gold in roman times...)
Angry Saver (profile) wrote on Fri, 5/29/2009 - 10:05 am
No sane person could argue that getting credit growing is the path to prosperity. Yet Bernanke does. Debt is not wealth Ben.
no, debt isn't wealth... but it does grow exponentially. which means (to someone else) credit grows exponentially. once you hatch this monster you don't get to put it back. once the speculative rentier economy detaches from any real relation of prices to the productive economy, it will first consume all value left in the real economy, and only then will it begin to feed on itself. it's a financial singularity.
When conservatives campaigned for an America of red states -- I don't think this is what they had in mind.
There's a t-shirt out there from the height of the Bush cult of personality, 2003 or thereabouts, showing an all-red America with scattered blue enclaves in the northeast and west, and a giant stetson hovering over it all. Passed it by at the thrift shop a few months back; but it has all new meaning, now.
How come it feels like we have the Oakland Raiders for a currency, while the rest of the world has currencies that made it to the playoffs or won the super bowl recently.
You could plot our financial downward trend to the Raiders, in fact. Their last championship was in 1983.
USD taking a pounding today. Can anyone here offer any reasonable guess as to why the long bond is showing strength against this USD backdrop. Seems like good day to fade the long bond...
The Obama administration took actions that averted a second Great Depression and now needs the American people to be patient as the recovery gathers steam, senior White House economic adviser Austan Goolsbee said.
Mr Goolsbee went on to say "Depression is an insidious disease. The President has taken steps to ensure the access to Zoloft and Prozac at a reasonable price for all citizens. He asked the Dept. of Homeland Security to begin setting up distribution points to meet the peoples needs. This program, KALM (Keep all the Losers Medicated) is expected to increase the sense of peace that we feel is needed in these trying times."
Silver is steadily inflating against gold right now. There is not a lot of silver out there available for purchase in bullion form. Silver is the perfect commodity for short squeeze potential. The silver ETFs alone are absorbing about 25% of total annual mine supply.
Unlike gold, which tends to get hoarded and resold, a lot of silver supply get consumed and disappears. Go SLW, baby!
Please be aware that this may turn into a serious towel day. Please remain inside an away from the track. Please, if you must pay attention; do not yell insults at the jockey.
"The plan to "monetize" the tax credit up-front is aimed at more quickly stabilizing the housing market, HUD Secretary Shaun Donovan said in a statement."
Donovan and Geithner are partners in crime these days.
I went to the Philly Fed link and there was an Excel file in there that shows the month over month change and I can only find four states not five that showed increasing activity from Mar'09 > Apr'09.
pretty sure every bond holder saw the manufactured 4% decline on the 10 YR yield this morning. Investors will flee treasury debt as long as chopper ben pegs the price above true investor sentiment. I expect all comers to sell all the bonds they own into the fed's scheme and convert the dollars into something else.
spreads will creep up here, there, then everywhere unless they can buy absolutely everything, as some seem to be suggesting.
printing money to buy absolutely everything indiscriminately to enforce artificial price controls across the entire economy probably isn't going to hold.
creditcriminalslovetarp (profile) wrote on Fri, 5/29/2009 - 10:38 am
How come the media keeps creating czars...are we in russia...
not quite yet. we have the Oligarchs assembled, and the private mercenaries will soon follow. all that's left then is to crush what's left of the middle class wealth and savings so they fall in with the rest of the proles. we've already destroyed their retirement (escape) hopes, and our government-owned banks own or will own almost all their mortgages.
"USD taking a pounding today. Can anyone here offer any reasonable guess as to why the long bond is showing strength against this USD backdrop. Seems like good day to fade the long bond..."
Zimbabwe Ben is back in the MBS market in a big way, trying to erase his losses from Wednesday. Only 1.75 to go now (from $3 down).
And in other news, the fiat currency of the USD is losing against other fiat currencies.
Real currencies like OIL (YEAH!!!!) and PMs are spiking as the Chinese and just about everyone else are trying to preserve their real (not nominal) wealth.
And while the equity market sleeps, fixed income, FX, and commodities markets are showing signs of unusual volatility...
"The plan to "monetize" the tax credit up-front is aimed at more quickly stabilizing the housing market, HUD Secretary Shaun Donovan said in a statement."
"pretty sure every bond holder saw the manufactured 4% decline on the 10 YR yield. Investors will flee treasury debt as long as chopper ben pegs the price above true investor sentiment. I expect all comers to sell all the bonds they own into the feds scheme and convert the dollars into something else."
BINGO, we have a winner.
Now you know exactly what happened in the MBS market on Wednesday - the children got angry that Daddy Ben wasn't around, so threw a hissy fit. Daddy came back late yesterday with the bottle.
Total dependence now on the Fed.
Treasury market headed in the exact same direction.
And just who is going to be buying when Chopper Ben wants to sell? I don't know if anyone is going to even know how to post a bid, all they post now are asks.
if secretive goons in control of the money supply are enforcing price controls across the entire marketplace it is fair to say what we have is a Command Economy.
now, help me out here, where have i heard this expression, "Command Economy"?
John Mitchell was the Attorney-General during the Nixon administration.
His wife - Martha Mitchell - told her psychologist that top White House officials were engaged in illegal activities. Her psychologist labeled these claims as caused by mental illness.
RockyR
If you're out there, the bet could end within your favour very soon. If it does, congratulations in advance because I will be out of town for the next week. I'm always too early
"Thanks rich about the heads up on TBT, I had been watching for a while, but your post made me pull the trigger @49. Sold higher."
I am donw with the TBT, but not sure about the timing. That fool is going to go all-in soon, tilting against his deflation windmill, and if he prints enough money, could drive that yield sub-3 again.
eventually it is going to explode. he doesn't even have to sell, he just needs to stop buying, see MBS market Wednesday.
by this time next year, 10 year yields are in the 6s, is my guess. or maybe 16s, depending on whether Congress steps in to stop the maniac in time.
ghostfaceinvestah
I double-dare you to launch a class action lawsuit against the fed under anti-trust saying they're pricing mortgage brokers out of the market
Anecdote: I was driving to work this AM, noticed a line outside of a one story building in the commercial district. I looked closer and the line was at the entrance to a blood plasma center. 15 to 20 folks waiting for the place to open so they could get their hands on some cash.
capital restrictions are just one step before travel restrictions. command economies usually have travel restrictions. what did you think all that shit at the airport (registered travelers) and 'the immigrants are eating us' rhetoric was all about?
EHP - who did you wager against about the oil price again? I think you're gonna have to pony up and admit he's right pretty soon. I bet he wishes the wager included cash. Or for this group, bullion.
"His wife - Martha Mitchell - told her psychologist that top White House officials were engaged in illegal activities. Her psychologist labeled these claims as caused by mental illness."
Ah, so you see, there was something to be learned from the Soviet experience of dealing with annoyances (sarcasm).
"Command Economy = the loving benevolence of the elite for the needs of the people."
Someone wrote that a politician is someone who gives your life for his country. I can't remember who it was, though. Perhaps that's because the name went down the memory hole.
"The plan to "monetize" the tax credit up-front is aimed at more quickly stabilizing the housing market, HUD Secretary Shaun Donovan said in a statement."
i've compile the controlling regulations, and am going to ask the IRS for a formal opinion on the following, which i've heard is actually happening. According to the regs, the following apply:
first time home buyer is one who has not owned an interest in a principal residence within the previous 3 years (some exclusions for recent military personnel and divorcees)
there is no minimum statutory age for first time home home buyers.
for unmarried joint purchasers, the purchasers can allocate the tax credit however they choose. spouses automatically take any non-qualifying status.
principal home ownership is not defined by the stimulus, but by the capital gains exclusion.
So, in theory, a parent could be a joint purchaser with each child (even minors), and each child would qualify for the refundable tax credit. and of course, we've seen how strict the definition of "principal residence is"
The "cash for clunkers" credit will be available for cars soon. From what I've heard, the standards for what constitutes a "clunker" will be kinda loose. expect the price of junkyard cars to converge to the credit.
OT: Bloomberg had an excellent article on Sheila Bair navigating the DC boys club. I've always been a huge fan of Bair, primarily because she's a disciple of Bush Senior's pragmatic politics. And the thing that worries me about the super-regulator is that we need the constructive regulatory friction. On numerous occasions, Bair has been the one checking Bairs and Geithner's handouts to the banks; earlier this week, she was the one that put the smackdown on shill bidding.
Game play, they either want more out of Chrysler or they want Obama to fund the German Gov in favor of Fiat. Now that the Chrysler deal is in BK what better time?
"I double-dare you to launch a class action lawsuit against the fed under anti-trust saying they're pricing mortgage brokers out of the market"
Well, but see, that is the thing, everyone is quiet on these actions as long as they make money. And there is plenty of money to be made (hint: there is an irrational buyer with unlimited funds, if you can't figure out how to make money out of that situation...)
my favorite play is fannie/freddie creating MBS out of their vintage portfolio to sell to BB.
i'll bet they never though they would get paid par for those 2003 loans at 5% note rates.
EHP, consider yourself lucky if most of your wealth is tied up in CAD, at least that fiat currency is getting debased at a slower rate.
besides, once oil hits $100, ripping up those tar sands is going to generate a lot of tax dollars, that $50B budget deficit is going to be turned around in no time.
though you might need to hire some border guards to fend off all the Americans fleeing the country.
I just received a come-on in the mail from some anonymous party in Dallas trying to entice me into a negative mortgage.
reverse mortgage?
I wonder how those who have reverse mortgages are faring. Do they determine the price you will get at the time of contract? Because if you took out a reverse mortgage on your house in 2005 when it was worth $800K, and now it's worth only $400K, seems like you may have gotten the better end of that bargain.
I wonder how those who have reverse mortgages are faring. Do they determine the price you will get at the time of contract? Because if you took out a reverse mortgage on your house in 2005 when it was worth $800K, and now it's worth only $400K, seems like you may have gotten the better end of that bargain.
========
I believe so. My parents closed on their reverse mortgage last year and are happy to have done so, now they have the lump sum of cash.
"...capital restrictions are just one step before travel restrictions. command economies usually have travel restrictions."
Yes, I watched Alexei Perevoshchikov, adult Soviet citizen, waving his propiska at a desk clerk in the Hotel Tashkent, giving him the right to be in Tashkent. He seemed to me like a nervous small child waving a written permission to use the facilities in a school building.
Sorry guys, but I have a feeling May relapsed a bit hence I suspect a market correction is near.
June will probably be worse with the GM bk. Probably July is the next "April" indicators wise. Which means the market will bottom in Augest and begin its REAL bull cycle.
except that no court would rule the contract valid if under 18
contracts are not presumptively invalid under the age 18. anyways, what's happening is that the parent and the child are entering as joint purchasers using the child to qualify for the refundable tax credit.. even if the court prevented enforcement as to the child, the contract is still enforceable against the parent.
Command Economy = the loving benevolence of the elite for the needs of the people.
our elite are so smart, nowadays, that they know what we need even before we do. because they manufacture the need and introduce it through MSM channels
ghostfaceinvestah
The strip mining is the old way of getting at the tar sands. After that there came Steam Assisted Gravity Drainage, now with solvents to work at lower temperatures. Next is a set of techniques that don't use any water at all such as antennas in the ground heating up just the oil so it can melt and pool down at a drain
also, about the double-dare. It's to fulfill entertainment value, think of all the great questions that could be asked of the Fed "Whaaaaat? You're paying above market value and you're not supposed to operate at a loss?"
"I wonder how those who have reverse mortgages are faring. Do they determine the price you will get at the time of contract?"
Yup, good thing those are all (or mostly all) insured by the FHA. More USD to be printed soon to bail out that mess, i am not sure how they are avoiding it so far, suspension of reality I guess.
Getting a reverse mortgage in 2006 would have been an incredible deal.
Anecdote: my wife noticed that Costco traffic at both their gas station and store registers are lighter than few months ago but Walmart is as busy/crowded as ever.
Costco Q1 results say their membership fees were down so that might explain the lighter crowd.
but would you go to court and try to enforce a contract signed by a 16 yr old?
when i was 16, i bought a car wash in my name, with my dad as co-signer. numerous contracts are entered to by legal minors. Hell, i'd imagine that a significant amount of non-dischargeable student loans are entered by minors, with parents as co-signors.
Edited: federal student loan borrowers 16 or older do not need co-signers.
the fascists (corporatistas) and the communists (central scrutinizers) are in a tag team match against the capitalists(darwinists) and the proles(pensionistas?) I like Macke's statement about jumping right over socialism into totalitarianism. The darwinists and pensionistas ( an unlikely pair) better start fighting together or they're toast. There's pretty good cross over here on CR, so it's not hopeless,but I'm not optimistic...it's like the crows and the pigeons vs. the sharp shinned hawks and the sparrows
Getting a reverse mtg now is a deal. The gov't pretends that houses are appreciating at a certain rate, and gives
you a chart showing your pluses and minuses.
the trick is, if you have to go into a nursing home you are stuck, it's an event of foreclosure.
If you live a really long time you win big. especially if they are giving you monthly payments. You could
collect way way more than the value of the house.
"The President has taken steps to ensure the access to Zoloft and Prozac at a reasonable price for all citizens. He asked the Dept. of Homeland Security to begin setting up distribution points to meet the peoples needs. This program, KALM (Keep all the Losers Medicated) is expected to increase the sense of peace that we feel is needed in these trying times.""
Shades of THX 1138........George Lucas WAS a visionary.
by this time next year, 10 year yields are in the 6s, is my guess. or maybe 16s
This is essentially my investment plan for the remainder of my working life... short the long end strategically (for example, covered some TLT on Wednesday) until rates hit 18%, then go long zeroes.
This article is worth a read. to my points earlier about TBT, good trade, but timing may be a bit early. i am guessing Sept/Oct before we have a massive bond market failure.
"Buying jumped today because yields rose high enough to draw demand, said Scott Simon, the head of mortgage-bond investing at Pacific Investment Management Co. "
C'mon Scott, be honest. Yields are dropping today because the Fed is stepping back in. You know as well as I do who is buying today.
"‘You can say goodbye to ‘Refi ‘09,’ ” Mann, who helps manage about $4 billion in bonds, said earlier today when yields were little changed. Other debt investors “don’t necessarily want to buy anything the Fed owns because the moment” it stops “buying you get crushed,” while the Fed’s purchases are becoming “self-defeating” as they boost borrowing and energy costs. "
I wouldn't say "goodbye Refi '09", BB is going to continue to print like a maniac and drive rates back down, but I agree with the self-defeating comments. Just look at oil and commodities prices. A few mortgage holders and a lot of banks are getting the benefits of lower mortgage rates, while anyone who fills up at the pump is getting hammered.
I personally don't see that as a good trade: attempt to prop up an asset bubble and increase costs on things people need.
If you live a really long time you win big. especially if they are giving you monthly payments. You could
collect way way more than the value of the house.
I read of a deal like this in France some years ago. An elderly woman, in her '80s, made a deal with an investor for her Paris flat; she got regular monthly payments, he got the flat when she died.
I can only find four states not five that showed increasing activity from Mar'09 > Apr'09
Well I do biz in two of the four [ND & MO - my two biggest accounts are in them]... if the country is holding out hope these guys will save us it is time to dig up the youtube of Hitler's last days in the bunker... just sayin'.
The beauty of a reverse mortgage is that since the borrower doesn't have to make a payment by definition there can't be a default. In the case of an annuity payment the total payments are substantially less than the value of the home even with the big decline. In the case of a lump sum they are probably close. However, the lender could probably get away by arguing that the current prices of home doesn't represent a permanent impairment and therefore get away without having to take a loss. The real problem starts in a 4-5 years assuming the borrower is 65 years old. If they haven't died then the remaining life expectancy is is greater than originally estimated and if the lender assumed an appreciating home price in their calculation that is when compounding kills them.
hiker90
I don't have a link or file to send, I had come across while trolling some IEEE articles a while back. I think Raytheon, possibly among others, is involved in developing it
"What this country needs is a good 5-cent cigar."
- Thomas Marshall
"There are plenty of good five-cent cigars in the country. The trouble
is they cost a quarter. What this country needs is a good five-cent nickel."
- Franklin P. Adams
There's a certain unease about naming the person in charge of fixing things after the Romanovs...
Instead of Car Czar, Cyber Czar, etc. - it ought to be 'Boss'... Car Boss, Cyber Boss, etc., a la 'The Sopranos'. Might actually get something done AND it would be All American!
"Yeesh, looking at the action in the 10-year and the Dollar, BB must be monetizing the long bond. Cheers to you, Ben! "
Well, he is monetizing more MBS, which of course will be really easy to sell once his is done with QE. Not.
I'm sure his head is just smoking, trying to figure out how there is such a reaction to his QE being played out in commodities. "But, this didn't happen in the 30s, must go back and re-read my history books."
I remember when I heard the news. It was a Wednesday. I was sitting in my cube when I heard the office finance nerd yell “Oh my Goblin!” Our heads popped up from our cubes like a field of prairie dogs when we heard him. Some of us, myself included, walked over to his cubicle. He was sitting there, white faced, reading some blog called “Calculated Risk.” He was shaking his head and muttering “It’s all over. Its all over.” I thought we had been nuked but it turned out to be some gibberish about the bond market. He lost all of ours attention within the first 3 minutes of his explanation. We went back to our cubes, quickly, before any of the glass office people noticed.
Not to long after that the world I had known for 35 years ceased to exist. One day it was, the next it wasn’t. That’s a bit of an exaggeration, but it was quick. Years ago I had gone to Haiti to build a church with a mission group. We had all talked about the “terrible” poverty the people lived in. I have to admit that I felt a certain sense of superiority. No one would ever admit to it, but I think we all knew they lived like that because they were not quite as smart as us. Now, well, the only difference that I can see is some of us use sun block and we get twice the mileage out of our particle board.
My son and I try to talk about it. The problem is he has all the answers and I don’t. I don’t trust the “explanations” he spouts as if it was the gospel. The problem is I still don’t understand how it went so wrong so fast. Today, the authorities came looking for him. They told me if he was convicted of “terrorist tendencies” we would all end up paying for his crime. I don’t think they will catch him. I hope not. The odd’s are he will never come back to us if he does. I told my wife to pack our “go bags” tonight. I am to old to work the fields of Kansas as part of the ‘great Reclamation.”
Perhaps tonight I will commit myself to the fates. He left a party flag in a can that he buried in the yard by the tomatoes. Today I think I will fly it outside our house. Blue, with a white circle. Inside the circle the black cross of the America First party. I asked my wife to go to her sisters but won’t leave. She is not thrilled about a future in the fields of Kansas either. I have my shotgun that I bought with the last of her jewelry. We will not go quietly into the night.
re: Czars On the American scene, czar was first bestowed on one of Andrew Jackson's foes: Nicholas Biddle, president of the Bank of the United States. Jackson vehemently opposed the centralized power of the bank, which he called a "hydra of corruption," and his clash with Biddle exploded into the "Bank War" of 1832-36. One of Jackson's staunchest allies in this fight, Washington Globe Publisher Frank Blair, dubbed Biddle "Czar Nicholas"—a potent image at a time when Russia's Nicholas I was at the height of his repressive nationalist regime. (Jackson's opponents fought fire with fire, calling him King Andrew I.) Why do we have so many "czars"? - By Ben Zimmer - Slate Magazine
"Can't get it up tonight, when performance matters?"
I am a girl and I see these commercials all the time. Can someone here explain to me what performance means? Is it supposed to improve how good you are or what?
I have worked with a few small commerical landlords (strip malls) and for the last decade Starbucks has always been the first call if anything opens up. Not only were they moving into anything, they also were well known for just accepting whatever rent was offered once they made the decision on the location. Little to no effort to negotiate, even though they could have easily demanded below market rates.
So many of their leases were over-market the moment they signed them.
A money market fund that you link to is very different from a "bond" fund.
It should typically hold very short term paper and as such won't be subject to a loss in value due to a rise in interest rates. Your purchasing power will be eroded but the NAV of the fund should stay at $1. If it holds just Treasuries Bills your risk is a default by the US Govt so the Treasury Bills are worthless - in which case you'll wish that you bought beans, bullets and gold instead of putting money in a 201k.
Bond funds that are invested in longer term paper are at risk to reduced NAV's when interest rates rise. As rates rise the price of existing bonds will fall so that the yield on the existing bond rises to keep up with the current yield on new issue bonds. Look for what the bond funds duration is and you will get a sense for how much interest rate risk the fund has.
dryfly (profile) wrote on Fri, 5/29/2009 - 10:00 am
I am to old to work the fields of Kansas as part of the ‘great Reclamation.”
How F'ing old are you nova? My old man was 'reclaiming prairie' into his early 80s.
By choice when it mattered. Big difference. These days reclamation means letting it go back to impermeable sod and beefaloes.
Cripes, I'm still looking for land around my great grandfather's New England farm to buy and construct 4 season executive fly-in resort. Now that's adaptive re-use.
Liz - I fear the day when the big banks start pressing for steep cuts in Medicare benefits because some MBA at a major bank decided that their reverse mortgages are costing them too much.
That's why my position on healthcare reform is "Whatever everyone thinks is best, but Congress and the government workers get exactly the same as the rest of us."
A bout TBT... I think adding incrementally thru all next week sounds like a pretty good bet. Geithner SELLING 10yr On June10 and the 30yr on June11. I think Ben has been trying to keep some powder dry for that week but perhaps he had a wave of commies raiding the fort to fight today, depleting some of his powder...
"So many of their leases were over-market the moment they signed them."
Money has to live somewhere.
I doubt if Zoloft and Starbucks is a good combo.
The author of "Invention of Air" says that the switch from daily beer consumption to tea (British tea time) created the Age of Englightenment. I wouldn't be surprised to see stimulants displaced in the next ten years to create "The Age of Incoherence".
Money doesn’t grow on trees for most of America. We sit down at our kitchen tables and write out checks to the phone-company, electric company, credit card-company, mortgage-company, and auto finance company every month. We clip coupons and go to the grocery store every week to put food in the mouths of our children. This is what our parents did before us.
bankers selling our childrens futures..for more bailouts? the disgrace. it's horrible. too big to fail needs to fail. we neeed LESS bailouts. If you fail U fail. Tons of informative articles.
da-da-da-da , da-da-da-da , ELMO'S WORLD
U.S. FHA to apply $8,000 credit to home buying costs
U.S. FHA to apply $8,000 credit to home buying costs
| Reuters
WASHINGTON (Reuters) - The Federal Housing Administration will allow the new $8,000 first-time homebuyer tax credit to be applied directly toward home purchase costs when using an FHA-insured mortgage, the Department of Housing and Urban Development said on Friday.
The plan to "monetize" the tax credit up-front is aimed at more quickly stabilizing the housing market, HUD Secretary Shaun Donovan said in a statement.
But in detailed rules, the FHA will still require home buyers to provide a minimum 3.5 percent downpayment from other sources.
The $8,000 tax credit for first-time home buyers was created as a part of the Obama administration's $787 billion stimulus plan. Some private lenders already were allowing buyers to apply the credits directly toward purchase costs through special financing schemes.
With the FHA following in a similar vein, a significant portion of the first-time homebuyer market will have up-front access to the credits instead of waiting until tax returns are filed.
"What we're doing today will not only help these families to purchase their first home but will present an enormous benefit for communities struggling to deal with an oversupply of housing," Donovan said in a statement
FHA-insured loans, which largely have replaced the subprime mortgage market, now accounts for about 25 percent of new mortgages, senior HUD officials said, versus about 2 percent of the market two years ago. At this pace, the agency will insure some 2.2 million mortgages this year.
The National Association of Home Builders estimates that the $8,000 first-time homebuyer credit will stimulate 160,000 home sales across the United States -- 101,000 purchases from first-time buyers and another 59,000 purchases by existing homeowners who sold dwellings to first-time buyers.
Red is the new green.
Yeah North Dakota, smallest drop in the nation!
IIRC, the North Dakota thing is gas industry related. They are hiring out there, evidently.
We are all Flyover, now.
I'm colorblind. Is North Dakota unchanged or down by .1 to .5%?
Dead child aka 9 year old they change? New Timmy?
since this is state-by-state, do they not count DC at all, or is it lumped with MD?
By Courtney Schlisserman
May 29 (Bloomberg) -- U.S. business activity contracted at a faster pace than forecast this month as orders and employment dropped.
The Institute for Supply Management-Chicago Inc. said today its business barometer decreased to 34.9 from 40.1 in April. Readings below 50 signal a contraction.
The report ran counter to others this month that indicated manufacturing was starting to improve this quarter, perhaps signaling that Chicago’s proximity to the auto slump in neighboring Detroit may be affecting the entire Midwest. Still, private economists have scaled back forecasts for economic growth in the second half of the year.
The figures are “undoubtedly affected significantly by shutdowns in the ailing automotive industry,” Joshua Shapiro, chief U.S. economist at Maria Fiorini Ramirez Inc., said in a note to clients. “The rate of decline in manufacturing output will moderate in coming months.”
-- Maria Ramirez has quickly tried to put a nice green shoots spin on this one! It continues to amaze me what crap these economists and analysts are feeding the masses. Of course the masses don't read any of this stuff anyway.
So now we know the Fed and their minions are working like dogs to prop up long T-bond prices.
ednesday put the fear of God into them about higher mortgage rates, etc.
This is a good test of your belief system. If you believe the Fed has the power to prop up the whole yield curve below zero interest on the short end (QE), then sell or hold off buying TBT.
If you believe the Fed has limited resolve or ammo to prop the whole curve, buy or hold TBT.
I don't believe the Fed will support the whole curve. They may try to help 10-year awhile. But they can't hold up longer-term bonds, too. The whole world is watching and most of the world don't like QE in the first place.
I'm holding TBT.
Timmy Yeas
Obama Prevented Depression, Now Needs Patience, Goolsbee Says
Obama Prevented Depression, Now Needs Patience, Goolsbee Says - Bloomberg.com
The Obama administration took actions that averted a second Great Depression and now needs the American people to be patient as the recovery gathers steam, senior White House economic adviser Austan Goolsbee said.
Still, private economists have scaled back forecasts for economic growth in the second half of the year.
========
we just read yesterday that 90% of economists expect the recession to end this year!
Citizen Scotto (profile) wrote on Fri, 5/29/2009 - 7:28 am replyIgnore user
I don't even go to CR anymore, I just read hoocoodanode
Ke, For traffic, click thru and and time on site stats, it might help to have the CR website url within the hoocoodanode.org directory http://calculatedrisk.hoocoodanode.org...
or something along those lines.....that adwords revenue decline might make CR post less....
The reason the dollar is tanking at the same time long T bonds are rising is because the Fed is cashing out big chunks of bonds, and the entities being cashed out are dropping dollars like hot potatoes. Huge fund flows.
i was just kidding I still click CR frequently
rich
The Fed has the power, but they still opt to use as little of it as possible. Nebbish that way. So we'll probably have a bit of a panic, and then when there are fewer people that have dry powder to move against them, they'll TCOB
Coming Soon! UFC 1*
It's the Ultimate Financial Challenge, as both combatants emerge into the octogone, two currencies go in, only one comes out viable~
*$49.95 pay-per-view
yep
test
"Ultimate Financial Challenge"
I think I'd go with Ultimate Currency Fight (UCF). Not sure that it qualifies as the first one either. (There's articles about silver inflating against gold in roman times...)
Angry Saver (profile) wrote on Fri, 5/29/2009 - 10:05 am
No sane person could argue that getting credit growing is the path to prosperity. Yet Bernanke does. Debt is not wealth Ben.
no, debt isn't wealth... but it does grow exponentially. which means (to someone else) credit grows exponentially. once you hatch this monster you don't get to put it back. once the speculative rentier economy detaches from any real relation of prices to the productive economy, it will first consume all value left in the real economy, and only then will it begin to feed on itself. it's a financial singularity.
When conservatives campaigned for an America of red states -- I don't think this is what they had in mind.
There's a t-shirt out there from the height of the Bush cult of personality, 2003 or thereabouts, showing an all-red America with scattered blue enclaves in the northeast and west, and a giant stetson hovering over it all. Passed it by at the thrift shop a few months back; but it has all new meaning, now.
Finally we're all united as red states.
How come it feels like we have the Oakland Raiders for a currency, while the rest of the world has currencies that made it to the playoffs or won the super bowl recently.
You could plot our financial downward trend to the Raiders, in fact. Their last championship was in 1983.
Maybe someone posted this, but Obama is appointing a computer czar? Security reasons, of course.
How come the media keeps creating czars...are we in russia...
Obama announces creation of 'cyber czar' post
Obama announces creation of 'cyber czar' post - MarketWatch
wouldn't director of cyber security ring better....
Comrades I now believe.....
USD taking a pounding today. Can anyone here offer any reasonable guess as to why the long bond is showing strength against this USD backdrop. Seems like good day to fade the long bond...
outsider wins by a neck!
The Obama administration took actions that averted a second Great Depression and now needs the American people to be patient as the recovery gathers steam, senior White House economic adviser Austan Goolsbee said.
Mr Goolsbee went on to say "Depression is an insidious disease. The President has taken steps to ensure the access to Zoloft and Prozac at a reasonable price for all citizens. He asked the Dept. of Homeland Security to begin setting up distribution points to meet the peoples needs. This program, KALM (Keep all the Losers Medicated) is expected to increase the sense of peace that we feel is needed in these trying times."
Silver is steadily inflating against gold right now. There is not a lot of silver out there available for purchase in bullion form. Silver is the perfect commodity for short squeeze potential. The silver ETFs alone are absorbing about 25% of total annual mine supply.
Unlike gold, which tends to get hoarded and resold, a lot of silver supply get consumed and disappears. Go SLW, baby!
Heh heh. gotta be quick. At least you got the name right. Cyber czar.
In other news, N. Korea has launched its 6th test missile. Yawn.
I normally like the color red but that chart is a little too red for my tastes.
There's a certain unease about naming the person in charge of fixing things after the Romanovs...
Please be aware that this may turn into a serious towel day. Please remain inside an away from the track. Please, if you must pay attention; do not yell insults at the jockey.
"The plan to "monetize" the tax credit up-front is aimed at more quickly stabilizing the housing market, HUD Secretary Shaun Donovan said in a statement."
Donovan and Geithner are partners in crime these days.
I went to the Philly Fed link and there was an Excel file in there that shows the month over month change and I can only find four states not five that showed increasing activity from Mar'09 > Apr'09.
Missouri
136.69
137.01
Montana
170.91
171.25
New Mexico
171.64
171.70
North Dakota
147.86
147.95
pretty sure every bond holder saw the manufactured 4% decline on the 10 YR yield this morning. Investors will flee treasury debt as long as chopper ben pegs the price above true investor sentiment. I expect all comers to sell all the bonds they own into the fed's scheme and convert the dollars into something else.
spreads will creep up here, there, then everywhere unless they can buy absolutely everything, as some seem to be suggesting.
printing money to buy absolutely everything indiscriminately to enforce artificial price controls across the entire economy probably isn't going to hold.
just a hunch.
creditcriminalslovetarp (profile) wrote on Fri, 5/29/2009 - 10:38 am
How come the media keeps creating czars...are we in russia...
not quite yet. we have the Oligarchs assembled, and the private mercenaries will soon follow. all that's left then is to crush what's left of the middle class wealth and savings so they fall in with the rest of the proles. we've already destroyed their retirement (escape) hopes, and our government-owned banks own or will own almost all their mortgages.
"USD taking a pounding today. Can anyone here offer any reasonable guess as to why the long bond is showing strength against this USD backdrop. Seems like good day to fade the long bond..."
Zimbabwe Ben is back in the MBS market in a big way, trying to erase his losses from Wednesday. Only 1.75 to go now (from $3 down).
And in other news, the fiat currency of the USD is losing against other fiat currencies.
Real currencies like OIL (YEAH!!!!) and PMs are spiking as the Chinese and just about everyone else are trying to preserve their real (not nominal) wealth.
And while the equity market sleeps, fixed income, FX, and commodities markets are showing signs of unusual volatility...
"The plan to "monetize" the tax credit up-front is aimed at more quickly stabilizing the housing market, HUD Secretary Shaun Donovan said in a statement."
Another sham to bailout the banks.
Thanks rich about the heads up on TBT, I had been watching for a while, but your post made me pull the trigger @49. Sold higher.
Free drink, clean glass, anytime
Well we won't have to worry about free health care if one of the nut countries do manage to develop a real nuke and deliver it here!
"pretty sure every bond holder saw the manufactured 4% decline on the 10 YR yield. Investors will flee treasury debt as long as chopper ben pegs the price above true investor sentiment. I expect all comers to sell all the bonds they own into the feds scheme and convert the dollars into something else."
BINGO, we have a winner.
Now you know exactly what happened in the MBS market on Wednesday - the children got angry that Daddy Ben wasn't around, so threw a hissy fit. Daddy came back late yesterday with the bottle.
Total dependence now on the Fed.
Treasury market headed in the exact same direction.
And just who is going to be buying when Chopper Ben wants to sell? I don't know if anyone is going to even know how to post a bid, all they post now are asks.
if secretive goons in control of the money supply are enforcing price controls across the entire marketplace it is fair to say what we have is a Command Economy.
now, help me out here, where have i heard this expression, "Command Economy"?
any history buffs out there?
otis, we need a "command economy Czar"
by the way, WTF is Fiat thinking?
Macke syndrome:
Psychologists and the Mitchell Effect
John Mitchell was the Attorney-General during the Nixon administration.
His wife - Martha Mitchell - told her psychologist that top White House officials were engaged in illegal activities. Her psychologist labeled these claims as caused by mental illness.
Command Economy = the loving benevolence of the elite for the needs of the people.
RockyR
If you're out there, the bet could end within your favour very soon. If it does, congratulations in advance because I will be out of town for the next week. I'm always too early
No green chutes on that map!
Price controls are coming to the forex market in the form of capital restrictions and currency pegs.
just like nixon here:
video of Nixon
and FDR before him
"Thanks rich about the heads up on TBT, I had been watching for a while, but your post made me pull the trigger @49. Sold higher."
I am donw with the TBT, but not sure about the timing. That fool is going to go all-in soon, tilting against his deflation windmill, and if he prints enough money, could drive that yield sub-3 again.
eventually it is going to explode. he doesn't even have to sell, he just needs to stop buying, see MBS market Wednesday.
by this time next year, 10 year yields are in the 6s, is my guess. or maybe 16s, depending on whether Congress steps in to stop the maniac in time.
FNM 30-yr at 4.41, down 3.5% today
ghostfaceinvestah
I double-dare you to launch a class action lawsuit against the fed under anti-trust saying they're pricing mortgage brokers out of the market
"Price controls are coming to the forex market in the form of capital restrictions and currency pegs."
Awesome, this will make betting even easier.
Though even with a 30%+ increase in my oil bet, I am not sure I am any "wealthier". sure, i have more USD...
Anecdote: I was driving to work this AM, noticed a line outside of a one story building in the commercial district. I looked closer and the line was at the entrance to a blood plasma center. 15 to 20 folks waiting for the place to open so they could get their hands on some cash.
capital restrictions are just one step before travel restrictions. command economies usually have travel restrictions. what did you think all that shit at the airport (registered travelers) and 'the immigrants are eating us' rhetoric was all about?
you can volunteer to be a registered traveler!
TSA: Registered Traveler
yep, scare the proles into begging for their poison.
ostrich people!
EHP - who did you wager against about the oil price again? I think you're gonna have to pony up and admit he's right pretty soon. I bet he wishes the wager included cash. Or for this group, bullion.
"His wife - Martha Mitchell - told her psychologist that top White House officials were engaged in illegal activities. Her psychologist labeled these claims as caused by mental illness."
Ah, so you see, there was something to be learned from the Soviet experience of dealing with annoyances (sarcasm).
"Command Economy = the loving benevolence of the elite for the needs of the people."
Someone wrote that a politician is someone who gives your life for his country. I can't remember who it was, though. Perhaps that's because the name went down the memory hole.
"Shaun of the Debt"
"The plan to "monetize" the tax credit up-front is aimed at more quickly stabilizing the housing market, HUD Secretary Shaun Donovan said in a statement."
re: $8K tax credit.
i've compile the controlling regulations, and am going to ask the IRS for a formal opinion on the following, which i've heard is actually happening. According to the regs, the following apply:
So, in theory, a parent could be a joint purchaser with each child (even minors), and each child would qualify for the refundable tax credit. and of course, we've seen how strict the definition of "principal residence is"
The "cash for clunkers" credit will be available for cars soon. From what I've heard, the standards for what constitutes a "clunker" will be kinda loose. expect the price of junkyard cars to converge to the credit.
OT: Bloomberg had an excellent article on Sheila Bair navigating the DC boys club. I've always been a huge fan of Bair, primarily because she's a disciple of Bush Senior's pragmatic politics. And the thing that worries me about the super-regulator is that we need the constructive regulatory friction. On numerous occasions, Bair has been the one checking Bairs and Geithner's handouts to the banks; earlier this week, she was the one that put the smackdown on shill bidding.
Bair Attacks Too-Big-to-Fail as Enforcer Geithner Must Trust - Bloomberg.com
Let's see......Green shoots spin on this one.....
More pink and lighter red states than the previous month. ?? Rate of decline is beginning to maybe look like it's about to slow down a little....
Anyone...anyone??
2000's must have: Plasma TV
2010's must give: Plasma
I just received a come-on in the mail from some anonymous party in Dallas trying to entice me into a negative mortgage.
"by the way, WTF is Fiat thinking? "
Game play, they either want more out of Chrysler or they want Obama to fund the German Gov in favor of Fiat. Now that the Chrysler deal is in BK what better time?
JD:
2000's must have: Plasma TV
2010's must give: Plasma IV?
"I double-dare you to launch a class action lawsuit against the fed under anti-trust saying they're pricing mortgage brokers out of the market"
Well, but see, that is the thing, everyone is quiet on these actions as long as they make money. And there is plenty of money to be made (hint: there is an irrational buyer with unlimited funds, if you can't figure out how to make money out of that situation...)
my favorite play is fannie/freddie creating MBS out of their vintage portfolio to sell to BB.
i'll bet they never though they would get paid par for those 2003 loans at 5% note rates.
EHP, consider yourself lucky if most of your wealth is tied up in CAD, at least that fiat currency is getting debased at a slower rate.
besides, once oil hits $100, ripping up those tar sands is going to generate a lot of tax dollars, that $50B budget deficit is going to be turned around in no time.
though you might need to hire some border guards to fend off all the Americans fleeing the country.
And people accuse Americans of not being well red...
I just received a come-on in the mail from some anonymous party in Dallas trying to entice me into a negative mortgage.
reverse mortgage?
I wonder how those who have reverse mortgages are faring. Do they determine the price you will get at the time of contract? Because if you took out a reverse mortgage on your house in 2005 when it was worth $800K, and now it's worth only $400K, seems like you may have gotten the better end of that bargain.
"there is no minimum statutory age for first time home home buyers"
except that no court would rule the contract valid if under 18
I wonder how those who have reverse mortgages are faring. Do they determine the price you will get at the time of contract? Because if you took out a reverse mortgage on your house in 2005 when it was worth $800K, and now it's worth only $400K, seems like you may have gotten the better end of that bargain.
========
I believe so. My parents closed on their reverse mortgage last year and are happy to have done so, now they have the lump sum of cash.
@otishertz,
Slashdot | Homeland Security To Scan Citizens Exiting US
Starting June 1, anybody leaving the country from Detroit or Atlanta will be fingerprinted, citizens included.
O+, 2x+good!
2000's must have: Plasma TV
2010's must give: Plasma IV?
"...capital restrictions are just one step before travel restrictions. command economies usually have travel restrictions."
Yes, I watched Alexei Perevoshchikov, adult Soviet citizen, waving his propiska at a desk clerk in the Hotel Tashkent, giving him the right to be in Tashkent. He seemed to me like a nervous small child waving a written permission to use the facilities in a school building.
Sorry guys, but I have a feeling May relapsed a bit hence I suspect a market correction is near.
June will probably be worse with the GM bk. Probably July is the next "April" indicators wise. Which means the market will bottom in Augest and begin its REAL bull cycle.
except that no court would rule the contract valid if under 18
contracts are not presumptively invalid under the age 18. anyways, what's happening is that the parent and the child are entering as joint purchasers using the child to qualify for the refundable tax credit.. even if the court prevented enforcement as to the child, the contract is still enforceable against the parent.
And shouldn't the dark red label be "Greater than -1.0%" -- not "Less than"?
And shouldn't the dark red label be "Greater than -1.0%" -- not "Less than"?
======
No, they mean it in the sense of -4% is "less" than -1% (i.e. it is less positive)
nova (profile) wrote on Fri, 5/29/2009 - 10:55 am
Command Economy = the loving benevolence of the elite for the needs of the people.
our elite are so smart, nowadays, that they know what we need even before we do. because they manufacture the need and introduce it through MSM channels
Better debt than red!
(with apologies to Birchers everywhere...)
@Basel
maybe, but would you go to court and try to enforce a contract signed by a 16 yr old?
I never envisioned that the Unabankers would do a self full filling prophecy, Manifest Debtstiny...
ghostfaceinvestah
The strip mining is the old way of getting at the tar sands. After that there came Steam Assisted Gravity Drainage, now with solvents to work at lower temperatures. Next is a set of techniques that don't use any water at all such as antennas in the ground heating up just the oil so it can melt and pool down at a drain
also, about the double-dare. It's to fulfill entertainment value, think of all the great questions that could be asked of the Fed "Whaaaaat? You're paying above market value and you're not supposed to operate at a loss?"
Just a friendly heads up
*****Comex And London Gold Vaults Being Emptied*****
Market Skeptics
Now, you don't think all that dead money sitting in vaults in NYC wasn't a tempting target to those that saw it as easy pickings?
I'm sure the I.O.U. Notes on the shelves where karats used to reside say something like:
I.O.U. one shelf full,
Sincerely...
Goliath
"I wonder how those who have reverse mortgages are faring. Do they determine the price you will get at the time of contract?"
Yup, good thing those are all (or mostly all) insured by the FHA. More USD to be printed soon to bail out that mess, i am not sure how they are avoiding it so far, suspension of reality I guess.
Getting a reverse mortgage in 2006 would have been an incredible deal.
Anecdote: my wife noticed that Costco traffic at both their gas station and store registers are lighter than few months ago but Walmart is as busy/crowded as ever.
Costco Q1 results say their membership fees were down so that might explain the lighter crowd.
but would you go to court and try to enforce a contract signed by a 16 yr old?
when i was 16, i bought a car wash in my name, with my dad as co-signer. numerous contracts are entered to by legal minors. Hell, i'd imagine that a significant amount of non-dischargeable student loans are entered by minors, with parents as co-signors.
Edited: federal student loan borrowers 16 or older do not need co-signers.
That heat map needs a darker shade of red--or perhaps black--to indicate "utter collapse".
I think glod is the only financial instrument that will benefit from fraud discovery in a digital vein, whereas everything else is Taintered by it.
the fascists (corporatistas) and the communists (central scrutinizers) are in a tag team match against the capitalists(darwinists) and the proles(pensionistas?) I like Macke's statement about jumping right over socialism into totalitarianism. The darwinists and pensionistas ( an unlikely pair) better start fighting together or they're toast. There's pretty good cross over here on CR, so it's not hopeless,but I'm not optimistic...it's like the crows and the pigeons vs. the sharp shinned hawks and the sparrows
Getting a reverse mtg now is a deal. The gov't pretends that houses are appreciating at a certain rate, and gives
you a chart showing your pluses and minuses.
the trick is, if you have to go into a nursing home you are stuck, it's an event of foreclosure.
If you live a really long time you win big. especially if they are giving you monthly payments. You could
collect way way more than the value of the house.
Next week over 4 days, European elections are going to be held, 736 MEPs to be elected, one poll suggests only 34% of people will bother to vote
There's a certain unease about naming the person in charge of fixing things after the Romanovs...
+1
EHP,
Can you post or send me link on the antenna heating methods. I know a little about steam flooding and would like to read up on the latest.
Thanks
Better debt than red!
(with apologies to Birchers everywhere...)
Backstop 'em all. Let God sort 'em out.
Starbucks pushing for 25% rent cut...
Starbucks Pushing Landlords for 25% Cut in Cafe Rents - Wall Street Examiner Forums
yay!
America is turning into an Chindexican pile!
"The President has taken steps to ensure the access to Zoloft and Prozac at a reasonable price for all citizens. He asked the Dept. of Homeland Security to begin setting up distribution points to meet the peoples needs. This program, KALM (Keep all the Losers Medicated) is expected to increase the sense of peace that we feel is needed in these trying times.""
Shades of THX 1138........George Lucas WAS a visionary.
by this time next year, 10 year yields are in the 6s, is my guess. or maybe 16s
This is essentially my investment plan for the remainder of my working life... short the long end strategically (for example, covered some TLT on Wednesday) until rates hit 18%, then go long zeroes.
This article is worth a read. to my points earlier about TBT, good trade, but timing may be a bit early. i am guessing Sept/Oct before we have a massive bond market failure.
Mortgage-Bond Yields Tumble, Signaling Lower Home-Loan Rates - Bloomberg.com
Two points of note:
"Buying jumped today because yields rose high enough to draw demand, said Scott Simon, the head of mortgage-bond investing at Pacific Investment Management Co. "
C'mon Scott, be honest. Yields are dropping today because the Fed is stepping back in. You know as well as I do who is buying today.
"‘You can say goodbye to ‘Refi ‘09,’ ” Mann, who helps manage about $4 billion in bonds, said earlier today when yields were little changed. Other debt investors “don’t necessarily want to buy anything the Fed owns because the moment” it stops “buying you get crushed,” while the Fed’s purchases are becoming “self-defeating” as they boost borrowing and energy costs. "
I wouldn't say "goodbye Refi '09", BB is going to continue to print like a maniac and drive rates back down, but I agree with the self-defeating comments. Just look at oil and commodities prices. A few mortgage holders and a lot of banks are getting the benefits of lower mortgage rates, while anyone who fills up at the pump is getting hammered.
I personally don't see that as a good trade: attempt to prop up an asset bubble and increase costs on things people need.
If you live a really long time you win big. especially if they are giving you monthly payments. You could
collect way way more than the value of the house.
I read of a deal like this in France some years ago. An elderly woman, in her '80s, made a deal with an investor for her Paris flat; she got regular monthly payments, he got the flat when she died.
She lived to 118.
Yeesh, looking at the action in the 10-year and the Dollar, BB must be monetizing the long bond. Cheers to you, Ben!
I can only find four states not five that showed increasing activity from Mar'09 > Apr'09
Well I do biz in two of the four [ND & MO - my two biggest accounts are in them]... if the country is holding out hope these guys will save us it is time to dig up the youtube of Hitler's last days in the bunker... just sayin'.
Can't get it up tonight, when performance matters?
try Profitloft*
The Black Pill
*side effects include loss of reserve status, jibbering, jabbering and an urge to do tribal sacrifices
Ok guys read backwards about kids and houses.
In Florida the answer is that you can put title into a 0ne year olds name; it's getting it out again that's a problem.
Sometimes little kids inherit property. Sometimes Cubans want their kids names on everything, just because.
However if you want to sell, you have to have a guardianship, or wait til the kid is 18.
Parents are natural guardians up to a certain amount, which I forget.
That heat map needs a darker shade of red--or perhaps black--to indicate "utter collapse".
It's infrared now - you just can't see it.
Folks,
If my 201k is in a bond fund such as BB&T US Treasury Money Market, will I get creamed when interest rates soar?
IIS 7.0 Detailed Error - 500.19 - Internal Server Error
Is it dawn or dusk? I wanna know which end of the sailor's proverb to bank on.
*** has been quiet as a church mouse lately...
Imagine doing time in the Big House otherwise known as UST's?
Re: reverse mortgages
The beauty of a reverse mortgage is that since the borrower doesn't have to make a payment by definition there can't be a default. In the case of an annuity payment the total payments are substantially less than the value of the home even with the big decline. In the case of a lump sum they are probably close. However, the lender could probably get away by arguing that the current prices of home doesn't represent a permanent impairment and therefore get away without having to take a loss. The real problem starts in a 4-5 years assuming the borrower is 65 years old. If they haven't died then the remaining life expectancy is is greater than originally estimated and if the lender assumed an appreciating home price in their calculation that is when compounding kills them.
hiker90
I don't have a link or file to send, I had come across while trolling some IEEE articles a while back. I think Raytheon, possibly among others, is involved in developing it
more on the Comex Gold story:
321gold: Oooooops
Keep in mind the source however it does raise some very prescient issues.
Ciao
MS
Shades of THX 1138........George Lucas WAS a visionary.
Are we happy? Are we effective? Consume!
Some timeless advice for the world weary:
"What this country needs is a good 5-cent cigar."
- Thomas Marshall
"There are plenty of good five-cent cigars in the country. The trouble
is they cost a quarter. What this country needs is a good five-cent nickel."
- Franklin P. Adams
Have a good weekend!
If Kramer guest-hosted for Cramer on Mad Money would anybody notice?
tncubsfan (profile) wrote on Fri, 5/29/2009 - 11:03 am reply Ignore user Let's see......Green shoots spin on this one.....
More pink and lighter red states than the previous month. ?? Rate of decline is beginning to maybe look like it's about to slow down a little....
Anyone...anyone??
The 3rd derivative of the map shows that everything is yellow ochre, except for California and Florida, where they are bright green.
@Juvenal
...and about 2 minutes into it slapped some money on the table and said: I'M OUT!
There's a certain unease about naming the person in charge of fixing things after the Romanovs...
Instead of Car Czar, Cyber Czar, etc. - it ought to be 'Boss'... Car Boss, Cyber Boss, etc., a la 'The Sopranos'. Might actually get something done AND it would be All American!
She outlived the purchaser by 2 years when she died at 122 if I'm thinking of the same story, Death Offers Lifeline to Italian Property as Economy Worsens - Bloomberg.com
"Yeesh, looking at the action in the 10-year and the Dollar, BB must be monetizing the long bond. Cheers to you, Ben! "
Well, he is monetizing more MBS, which of course will be really easy to sell once his is done with QE. Not.
I'm sure his head is just smoking, trying to figure out how there is such a reaction to his QE being played out in commodities. "But, this didn't happen in the 30s, must go back and re-read my history books."
Rate of decline is beginning to maybe look like it's about to slow down a little....
On CNBC, the Burberry's CEO said that the one year anniversary of the slowdown is approaching so the YoY numbers are going to look a lot better soon.
If Kramer guest-hosted for Cramer on Mad Money would anybody notice?
I would - I'd watch. Financial version of 'master of your own domain'.
I remember when I heard the news. It was a Wednesday. I was sitting in my cube when I heard the office finance nerd yell “Oh my Goblin!” Our heads popped up from our cubes like a field of prairie dogs when we heard him. Some of us, myself included, walked over to his cubicle. He was sitting there, white faced, reading some blog called “Calculated Risk.” He was shaking his head and muttering “It’s all over. Its all over.” I thought we had been nuked but it turned out to be some gibberish about the bond market. He lost all of ours attention within the first 3 minutes of his explanation. We went back to our cubes, quickly, before any of the glass office people noticed.
Not to long after that the world I had known for 35 years ceased to exist. One day it was, the next it wasn’t. That’s a bit of an exaggeration, but it was quick. Years ago I had gone to Haiti to build a church with a mission group. We had all talked about the “terrible” poverty the people lived in. I have to admit that I felt a certain sense of superiority. No one would ever admit to it, but I think we all knew they lived like that because they were not quite as smart as us. Now, well, the only difference that I can see is some of us use sun block and we get twice the mileage out of our particle board.
My son and I try to talk about it. The problem is he has all the answers and I don’t. I don’t trust the “explanations” he spouts as if it was the gospel. The problem is I still don’t understand how it went so wrong so fast. Today, the authorities came looking for him. They told me if he was convicted of “terrorist tendencies” we would all end up paying for his crime. I don’t think they will catch him. I hope not. The odd’s are he will never come back to us if he does. I told my wife to pack our “go bags” tonight. I am to old to work the fields of Kansas as part of the ‘great Reclamation.”
Perhaps tonight I will commit myself to the fates. He left a party flag in a can that he buried in the yard by the tomatoes. Today I think I will fly it outside our house. Blue, with a white circle. Inside the circle the black cross of the America First party. I asked my wife to go to her sisters but won’t leave. She is not thrilled about a future in the fields of Kansas either. I have my shotgun that I bought with the last of her jewelry. We will not go quietly into the night.
re: Czars
On the American scene, czar was first bestowed on one of Andrew Jackson's foes: Nicholas Biddle, president of the Bank of the United States. Jackson vehemently opposed the centralized power of the bank, which he called a "hydra of corruption," and his clash with Biddle exploded into the "Bank War" of 1832-36. One of Jackson's staunchest allies in this fight, Washington Globe Publisher Frank Blair, dubbed Biddle "Czar Nicholas"—a potent image at a time when Russia's Nicholas I was at the height of his repressive nationalist regime. (Jackson's opponents fought fire with fire, calling him King Andrew I.)
Why do we have so many "czars"? - By Ben Zimmer - Slate Magazine
I am to old to work the fields of Kansas as part of the ‘great Reclamation.”
How F'ing old are you nova? My old man was 'reclaiming prairie' into his early 80s.
"Can't get it up tonight, when performance matters?"
I am a girl and I see these commercials all the time. Can someone here explain to me what performance means? Is it supposed to improve how good you are or what?
not a friend-
That's the question BB has been asking since Weds.
Ciao
MS
Czardoz, staring Sean Connery
Well, he is monetizing more MBS, which of course will be really easy to sell once his is done with QE. Not.
Ghost,
We're going with the good banks - bad (central) bank fix. It's great for wall street and CNBC. A true win-win!
Bring on the prosperity (to wall street).
Czardoz, staring Sean Connery
+1
broward (homepage, profile) wrote on Fri, 5/29/2009 - 9:32 am Starbucks pushing for 25% rent cut...
http://forums.wallstreetexaminer.com/index.php?showtopic=819615
I have worked with a few small commerical landlords (strip malls) and for the last decade Starbucks has always been the first call if anything opens up. Not only were they moving into anything, they also were well known for just accepting whatever rent was offered once they made the decision on the location. Little to no effort to negotiate, even though they could have easily demanded below market rates.
So many of their leases were over-market the moment they signed them.
Cinco - X
A money market fund that you link to is very different from a "bond" fund.
It should typically hold very short term paper and as such won't be subject to a loss in value due to a rise in interest rates. Your purchasing power will be eroded but the NAV of the fund should stay at $1. If it holds just Treasuries Bills your risk is a default by the US Govt so the Treasury Bills are worthless - in which case you'll wish that you bought beans, bullets and gold instead of putting money in a 201k.
Bond funds that are invested in longer term paper are at risk to reduced NAV's when interest rates rise. As rates rise the price of existing bonds will fall so that the yield on the existing bond rises to keep up with the current yield on new issue bonds. Look for what the bond funds duration is and you will get a sense for how much interest rate risk the fund has.
Dryfly,
It isn't about me. It is about your fictional average American in his late 50's. Not some throw back old codger who remembers 23 skadoo
What's the difference between the Buffalo Bills & Treasury Bills?
Buffalo has a better record...
dryfly (profile) wrote on Fri, 5/29/2009 - 10:00 am
I am to old to work the fields of Kansas as part of the ‘great Reclamation.”
How F'ing old are you nova? My old man was 'reclaiming prairie' into his early 80s.
By choice when it mattered. Big difference. These days reclamation means letting it go back to impermeable sod and beefaloes.
Cripes, I'm still looking for land around my great grandfather's New England farm to buy and construct 4 season executive fly-in resort. Now that's adaptive re-use.
Liz - I fear the day when the big banks start pressing for steep cuts in Medicare benefits because some MBA at a major bank decided that their reverse mortgages are costing them too much.
That's why my position on healthcare reform is "Whatever everyone thinks is best, but Congress and the government workers get exactly the same as the rest of us."
My old man was 'reclaiming prairie' into his early 80s.
=====
excellent. My gramps is 91 and still tills the "black prairie" east of Austin (had an easier time of it his first 80 years while in Ky)
nova,
Awesome, funny and mildly spooky at the same time.
Did Stan O'Neal get picked up on waivers by some other MBA Team?
Thank you.
A bout TBT... I think adding incrementally thru all next week sounds like a pretty good bet. Geithner SELLING 10yr On June10 and the 30yr on June11. I think Ben has been trying to keep some powder dry for that week but perhaps he had a wave of commies raiding the fort to fight today, depleting some of his powder...
Bloomberg.com:
Economic Calendar
By "widespread recession" you mean recovery of course...
"maybe, but would you go to court and try to enforce a contract signed by a 16 yr old?"
16 year-olds regularly sign all kinds of stuff to get driver's licenses.
"So many of their leases were over-market the moment they signed them."
Money has to live somewhere.
I doubt if Zoloft and Starbucks is a good combo.
The author of "Invention of Air" says that the switch from daily beer consumption to tea (British tea time) created the Age of Englightenment. I wouldn't be surprised to see stimulants displaced in the next ten years to create "The Age of Incoherence".
I wonder what sort of Chinese food Timmay eats today?
Peaking Duck in a debt sauce
I wonder what sort of Chinese food Timmay eats today?
He ate what he was served and was told to like it.
bearly-
sounds logical.....but as the old saying goes as soon as you have the key they change the locks.
Ciao
MS
WHo is that Thomas clown on CNBC. He's sitting on a telephone book to appear as tall as the women.
awesomely obscure reference...
Money doesn’t grow on trees for most of America. We sit down at our kitchen tables and write out checks to the phone-company, electric company, credit card-company, mortgage-company, and auto finance company every month. We clip coupons and go to the grocery store every week to put food in the mouths of our children. This is what our parents did before us.
bankers selling our childrens futures..for more bailouts? the disgrace. it's horrible. too big to fail needs to fail. we neeed LESS bailouts. If you fail U fail. Tons of informative articles.
I came across this interesting site..check it out Econ & Finance Articles Updated Daily