Thursday, November 29, 2007

NAHB - "New-Home Sales Edge Up In October" (11-29-07)

"New single-family home sales edged up 1.7 percent in October following a dramatic downward revision to the preliminary estimate for September, the U.S. Commerce Department reported today. October’s seasonally adjusted annual rate of 728,000 units was 23.5 percent below a year ago."

Reuters - "Home foreclosures soar 94 percent: RealtyTrac" (11-29-07)

"Home foreclosure filings in October edged up 2 percent from September but at 224,451 were a whopping 94 percent higher than a year earlier, real estate data firm RealtyTrac said on Thursday. The figure, a sum of default notices, auction sale notices and bank repossessions, was down from a 32-month peak in August however, RealtyTrac, an online market of foreclosure of properties, said in its monthly foreclosure market report."

Washington Post - "SEC Votes to Limit Shareholder Rights" (11-29-07)

"Companies will be able to scuttle investor attempts to nominate board members under a plan adopted by a bitterly divided Securities and Exchange Commission yesterday. The move drew an outcry from key lawmakers, unions and major retirement funds, which criticized SEC Chairman Christopher Cox, a Republican, for pushing the plan at a time when the agency is short one Democrat and another is on her way out the door."

The Washington Post - "Municipal Bond Deals Squeezed By Credit Crisis" (11-29-07)

"The widening credit crunch is making it harder for cities and school systems to get money for buildings, ballparks and other vital projects from the $2.5 trillion market for municipal bonds, a sector of Wall Street that rarely sees trouble. That is leaving them with a tough choice: either put off the projects, or pay higher interest rates on their bonds, a cost that ultimately would fall on the backs of taxpayers."

Bloomberg - "Treasury 3-Month Bill Yields Fall Below 3% on Credit Concern" (11-29-07)

"Treasuries rose and three-month bill yields fell below 3 percent for the first time since August as concern over banks' willingness to lend drove investors to the relative safety of U.S. government debt. The interest rate that banks charge each other for borrowing in dollars for one month rose the most in more than a decade as banks sought to cover their commitments through the start of 2008. Yields on notes fell as futures traders increased bets that the Federal Reserve will cut borrowing costs a half- percentage point next month to prevent a recession."

Bloomberg - "GM, Wounded by Autos, Now Catches It From Housing" (11-29-07)

"General Motors Corp. probably thought nothing could be worse than poor quality ratings or a strike by the United Auto Workers union. Now the world's biggest automaker has a new headache: a nationwide glut of unsold homes and plunging housing-related securities."

Bloomberg - "Paulson Housing Bets Make $2.7 Billion, Beat Citadel" (11-29-07)

"The subprime crisis that's caused so much trauma for hedge funds and investment banks has brought only good news for John Paulson. He's the manager of more than $7 billion in hedge fund money keyed to mortgage credit. Paulson started warning his investors back in the middle of 2006 that the frenzy to build and sell housing was a bubble about to pop. His New York-based firm, Paulson & Co., made big bets predicting the edifice would soon come crashing down. The wager paid off in the first nine months of 2007, when Paulson's Credit Opportunities funds rose an average of 340 percent."

Los Angeles Times - "Down (54%) in the Valley" (11-29-07)

"Good morning. If I had to pick only one region of Los Angeles to monitor for housing trends, in hopes of capturing the overall market, I'd probably pick the San Fernando Valley. Yes, it's expensive (median sales price $590,000), but it's a big area, containing within it a range of neighborhoods and properties. That said, things are looking down in the Valley. From the Daily News: 'Home sales in the San Fernando Valley hit a record low for the second consecutive month in October, plunging 54 percent from a year ago as mortgage industry turmoil continued to roil the market, a trade association said Wednesday.'"

Orange County Register Blog - "Santa Ana condo towers take a sales break" (11-29-07)

"Sales at Skyline at MacArthur Place have been halted through Feb. 1, said Cory Alder, president of Nexus Cos., which is developing Skyline. The 25-story luxury condo towers are rising above the Hutton Center in Santa Ana near the Costa Mesa (55) Freeway."

Orange County Register Blog - "Citadel to give E*Trade $2.55 billion cash infusion" (11-29-07)

"Citadel Investment Group in Chicago, which bought failed subprime lender ResMae Mortgage Corp. in Brea earlier this year, now will provide E*Trade Financial Corp. with $2.55 billion in cash as the brokerage faces mortgage woes, reports Reuters."

Wednesday, November 28, 2007

NAR - "Mixed Results For October Existing-Home Sales; Mortgages Improving" (11-28-07)

"Single-family existing-home sales were stable in October while the condo sector was down, according to the National Association of Realtors®. Lingering effects of the credit crunch were a drag on sales but the mortgage situation has improved significantly."

CBIA - "Housing Production Continues Downward in October, CBIA Announces" (11-28-07)

"Production of homes in California continued a downward trend in October as homebuilders continued to take steps to reduce inventory before year-end, the California Building Industry Association reported today. Total housing starts in California, as measured by building permits issued, dropped 28 percent in October when compared to the same month a year ago to 7,726, according to housing permit data supplied by the Construction Industry Research Board. Production of single-family homes fell 41 percent while construction of multifamily units decreased 10 percent when compared to October of 2006."

Mortgage Bankers Association - "Mortgage Applications Decrease In Latest MBA Weekly Survey" (11-28-07)

"The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending November 23, 2007. The Market Composite Index, a measure of mortgage loan application volume, was 652.5, a decrease of 4.3 percent on a seasonally and holiday adjusted basis from 681.7 one week earlier. On an unadjusted basis, the Index decreased 25.5 percent compared with the previous week reflecting the Thanksgiving holiday on November 22 and was up 24.6 percent compared with the same week one year earlier."

Yahoo - "Wells Fargo Plunges Into Mortgage Muck" (11-28-07)

"After avoiding major trouble most of the year, Wells Fargo & Co. has finally bogged down in the mortgage muck that's muddying one major bank after another. Wells Fargo, the fifth-largest U.S. bank, waded into the mess by saying it will recognize $1.4 billion in losses in the fourth quarter on home equity loans that aren't being repaid as the real estate slump deepens in California, the Midwest and other major markets."

Market Watch - "Supply of homes on market at 22-year high" (11-28-07)

"Sales of existing homes fell for an eighth straight month in October even as more properties came on the U.S. housing market, driving the supply of homes up for sale to the highest level in 22 years, the National Association of Realtors reported Wednesday. Seasonally adjusted sales dropped 1.2% to an annualized pace of 4.97 million last month, the real-estate advocacy group said. The sales pace stands at the lowest seen since 1999, when the group began tracking combined sales of single-family homes and condominiums."

Market Watch - "Freddie Mac shares rally on capital plan" (11-28-07)

"Shares of Freddie Mac jumped Wednesday, rallying as the mortgage buyer announced that it's offering $6 billion in preferred stock and cutting its quarterly dividend in half in a bid to raise and conserve capital."

Bloomberg - "Wolseley Will Cut 1,300 U.S. Jobs as Profit Drops 15%" (11-28-07)

"Wolseley Plc, the world's biggest distributor of plumbing and heating equipment, plans to cut 1,300 jobs in the U.S. in its fiscal second quarter as the worst housing recession for 16 years hurts profit. The reduction will bring the total number of U.S. job cuts over 1 1/2 years to 9,000, equal to about one-fifth of Wolseley's North American workforce, as branches and depots shut. First- quarter pretax profit through October fell almost 15 percent as a weaker dollar and fewer housing starts led to a 10 percent decline in U.S. revenue, the Reading, England-based company said today."

Reuters - "Liquidity crunch deepens in interbank money markets" (11-28-07)

"Money markets tightened further on Wednesday with the cost of borrowing euros in the wholesale interbank market hitting fresh 6-1/2 year highs as banks paid a higher premium for cash covering the New Year period. Cash is getting less available and more expensive in the market since the credit crunch started in August as banks hoard cash as a contingency against credit-related losses. This general shortage is being exacerbated by liquidity concerns over the seasonally thin Christmas and New Year period."
NAHB - "Home Price Changes Vary By Market, Latest Data Shows" (11-27-07)

"Home appreciation rates vary significantly among the nation’s top markets, according to the latest monthly S&P/Case-Shiller home price statistics that track the nation’s 20 largest metro areas. Among the top 20 markets surveyed by S&P/Case-Shiller, which represent more than 40 percent of the U.S. population, five showed positive home price appreciation rates over the past year, seven posted declines of less than 5 percent, and eight metro areas registered losses of between 5 and 10 percent."

Mortgage Bankers Association - "2008 Conforming Loan Limit $417,000" (11-27-07)

"Office of Federal Housing Enterprise Oversight Director James B. Lockhart today announced the maximum 2008 conforming loan limit for single-family mortgages purchased by Fannie Mae and Freddie Mac (the Enterprises) will remain at the 2007 level of $417,000 for one-unit properties for most of the U.S. Higher limits apply to Alaska, Hawaii, Guam and the U.S. Virgin Islands as well as to properties with more than one unit."

MSN - "Getting rich off the subprime mess" (11-27-07)

"For months, Burry had been seeking ways to make money by betting big against the mortgage industry's reckless home-lending practices. And this call from a credit dealer at Deutsche Bank (DB, news, msgs) would finally set his plot in motion. As of last week, Burry's bet against the lenders had helped him quadruple an initial investment of roughly $80 million, according to my estimates. But these trades of a lifetime were by no means easy. They required the former Stanford University Medical Center neurology resident to combine nerves of steel with the conviction of a federal prosecutor. Not to mention his natural inclination as a skeptic."

Yahoo - "Citi Sells Stake to Abu Dhabi Fund" (11-27-07)

"The Abu Dhabi Investment Authority will invest $7.5 billion in Citigroup, offering the nation's largest bank needed capital to offset big losses from mortgages and other investments. The cash from the sovereign investment fund of the Gulf Arab state, which has benefited from this year's surge in oil prices, will be convertible into no more than 4.9 percent of Citigroup Inc.'s equity. Citigroup characterized the investment as passive and said the fund will not be able to name any board members to the bank."

Bloomberg - "U.S. Mortgage Crisis Slams Property Values, Revenue" (11-27-07)

"The worst U.S. housing recession in 16 years will drive down property values by $1.2 trillion next year and slash tax revenue by more than $6.6 billion, according to a report by the U.S. Conference of Mayors. California, the hardest-hit state, will suffer a $630.6 billion decrease in property values that will cut property tax revenue to local governments by almost $3 billion, the study estimated. The New York City region will see the greatest slowdown in economic output because of the mortgage crisis, according to the report."

Market Watch - "Home prices falling at record pace in third quarter" (11-27-07)

"U.S. home prices fell 4.5% in the year ending in the third quarter, according to the national Case-Shiller price index released by Standard & Poor's on Tuesday. Prices fell 1.7% compared with the second quarter. It's by far the largest price decline in the 20 years covered by the index. Prices had fallen 3.2% in the year ending in the second quarter. Prices fell in all 20 major cities in September compared with August, and were down 4.9% in the past year. Prices fell 5.5% year-over-year in the original 10-city index. The Case-Shiller index, which tracks multiple sales of the same homes, is considered by many observers to be the best gauge of national and metropolitan-area real-estate values."

Yahoo - "D.R. Horton Predicts '08 Worse Than '07" (11-27-07)

"D.R. Horton Inc.'s stock sank to its cheapest trade in four years Tuesday after the homebuilder's chief executive, Donald J. Tomnitz, predicted the housing market will worsen in 2008. Tomnitz's prediction, proffered at the JPMorgan Homebuilding and Building Products Conference at Mandalay Bay in Las Vegas, hinged on foreclosures."

Bloomberg - "Wells Fargo Sets $1.4 Billion Charge for Home Equity" (11-27-07)

"Wells Fargo & Co., the second- largest U.S. mortgage lender, will take a $1.4 billion pretax charge tied to increased losses on home equity loans. The stock fell more than 4 percent in extended trading. The fourth-quarter charge reflects 'the higher losses the company expects in this portfolio because of further deterioration in the outlook for the housing markets,' the San Francisco-based bank said in a statement. The bank cut off most home-equity loans originated by other financial institutions and mortgage companies and tightened standards on ones made by outside brokers."

Los Angeles Times - "Homeowners' big question: How low will prices go?" (11-27-07)

"'There is nowhere to go but down from here,' said Broida, a leasing broker for office space. 'I know it in my gut.' Few would argue. Southern California home prices have fallen for five straight months, according to data released this month, and are now down 12% from their peak last spring and summer."

Opinion Journal - "The Rise of Family-Friendly Cities" (11-27-07)

"If you talk with recruiters and developers in the nation's fastest growing regions, you find that the critical ability to lure skilled workers, long term, lies not with bright lights and nightclubs, but with ample economic opportunities, affordable housing and family friendly communities not too distant from work. 'People who come here tend to be people who have long commutes elsewhere, and who have young children,' notes Pat Riley, president of Alan Tate company, a large residential brokerage in Charlotte, N.C. 'They want to be somewhere where they don't miss their kids growing up because there's no time.'"

Real Estate Journal - "Housing Woes May Be The Grinch This Season" (11-27-07)

"Now, with mortgage delinquencies at record highs and mortgage-equity withdrawals well off the peak hit in the second half of 2006, the housing mess has begun to exact collateral damage on the larger consumer economy, beyond the furniture and home-improvement retailers that began to be squeezed a year ago. It is one of the main reasons that holiday sales are expected to be the weakest since the recession in the early part of the decade."

Monday, November 26, 2007

Yahoo - "Citi Aims to Cut Costs; Layoffs Possible" (11-26-07)

"Citigroup Inc., bracing for big credit-related losses in the fourth quarter, is looking to lower costs -- which could mean another round of job cuts at the nation's largest bank. 'We are engaged in a planning process in anticipation of our new CEO, and our business heads are planning ways in which we can be more efficient and cost-effective to position our businesses in line with economic realities,' Citi spokeswoman Shannon Bell said Monday."

Reuters - "JPMorgan to cut about 100 subprime jobs" (11-26-07)

"JPMorgan Chase & Co Inc plans to cut about 100 subprime mortgage jobs in California amid falling U.S. housing prices and tighter lending standards. JPMorgan disclosed the cuts in a recent filing with the California Employment Development Department. The cuts, effective December 15, will take place at JPMorgan's subprime retail operations center in Ontario, California."

Bloomberg - "Bank of America Takes Lead in Backing `SuperSIV' Fund" (11-26-07)

"Bank of America Corp., the nation's second-largest bank, will lead efforts by Citigroup Inc. and JPMorgan Chase & Co. to convince smaller competitors to help finance an $80 billion bailout of short-term debt markets. The campaign starts this week with New York-based Citigroup and JPMorgan in supporting roles to Charlotte, North Carolina- based Bank of America, said two people with knowledge of the matter, who didn't want to comment publicly before the plan is formally announced."

Yahoo - "HSBC Bails Out 2 Troubled Funds" (11-26-07)

"HSBC Holdings PLC, Europe's largest bank, said Monday it will bail out two troubled funds it manages by transferring about $45 billion of their assets onto its balance sheet. HSBC said it will also inject $35 billion into the two funds, Cullinan Finance Ltd. and Asscher Finance Ltd., in a move that will clarify responsibility for the funds and prevent liquidation of their assets."

CNN - "Don't look now: Here comes the recession" (11-26-07)

"After years of living happily beyond their means, Americans are finally facing financial reality. A persistent rise in energy prices will mean bigger heating bills this winter and heftier tabs at the gas pump. Job growth is slowing and wage gains have been anemic. House prices are sliding, diminishing the value of the asset that's the biggest factor in Americans' personal wealth. Even the stock market, which has been resilient for so long in the face of eroding consumer sentiment, has begun pulling back amid signs of deep distress in the financial sector."

Bloomberg - "Countrywide Falls as Schumer Seeks Probe of Advances" (11-26-07)

"Countrywide Financial Corp. fell more than 10 percent in New York Stock Exchange trading after U.S. Senator Charles Schumer urged the Federal Home Loan Bank system to probe cash advances to the largest U.S. mortgage lender."

Bloomberg - "Japan's Growth Forecast Cut by Economists on Housing" (11-26-07)

"Japan's gross domestic product forecast was cut by economists, who said a plunge in housing starts and construction investment will slow economic growth. The world's second-largest economy will grow 1.5 percent in the year ending March 31, according to the median forecast of 33 economists surveyed by Bloomberg News from Nov. 14 to Nov. 22. A month ago, the median projection was for a 1.7 percent expansion."

Los Angeles Times Blog - "A new respect for debt?" (11-26-07)

"David Lazarus provides the protein here with a thoughtful column in today's paper, reporting that holiday shoppers seem to have a new respect for debt this year: '... anecdotal evidence suggests that, after years of putting everything they desired on plastic, some people finally may be getting smarter about their finances. And many, though they may not be conscious of it, seem to have a gut feeling that the economy is going to keep heading south.'"

Real Estate Journal - "Rising Use of 'Impact' Fees Rankles New-Home Buyers" (11-26-07)

"While few rocket into six figures, impact fees such as those faced by Ms. Banzon and Mr. Ahmad are popping up in a rapidly expanding number of cash-strapped U.S. municipalities scrounging for new revenue sources while federal funding for local infrastructure has become more difficult to obtain. The one-time fees, imposed on builders and often folded into home prices and passed on to buyers, are used by cities to fund construction of infrastructure such as roads, sidewalks, parks and even fire stations for rapidly growing neighborhoods. A 2006 Kansas State University survey found that 39% of the 292 U.S. cities responding imposed impact fees on new construction last year, up from 25% in 2002."
The San Diego Union Tribune - "Governor-led deal helps, but it's no game-winner" (11-25-07)

"Schwarzenegger pulled together the heads of four major mortgage operations – Countrywide, GMAC, Litton and HomeEq – and encouraged them to keep subprime mortgage borrowers at their initial interest rate as long as they're living in their home (i.e. they're not speculators) and making timely payments (i.e. they haven't defaulted), but won't be able to afford their adjustable-rate loan if it resets to a higher rate."

Market Watch - "A week of weakness seen for U.S. economy" (11-25-07)

"That's how one economist describes the U.S. economy as the markets get ready for a busy week of data, including numbers about the already damaged U.S. housing market, orders for durable goods and personal income and spending. Housing has been a big drag on the economy and this coming week's data forecasts don't offer any hope that the housing outlook will improve. Analysts surveyed by MarketWatch are expecting existing home sales, for example, to drop to a seasonally adjusted annual rate of 4.99 million in October from an eight-year low of 5.04 million in September. The existing home sales report is due out at 10 a.m. on Tuesday."

Toronto Sun - "Guess who pays?" (11-25-07)

"We're being nickeled and dimed to death to pay for losses racked up when our banks were lured into the U.S. sub-prime mess by floating instruments, called asset-backed commercial paper (ABCP). These babies, that bundled up collaterized debt obligations and sold to investors, caused a liquidity crunch this past summer, sending markets into a tailspin. The Bank of Canada was forced to jump in and prop up our financial system by injecting billions of dollars."

The San Diego Union Tribune - "Neighborhoods suffer as crime follows foreclosure" (11-25-07)

"Eighty-five bungalows dot the cul-de-sac that joins West Ontario Avenue and East Ontario Avenue in Atlanta. Twenty-two are vacant, victims of mortgage fraud and foreclosure. Now house fires, prostitution, vandals and burglaries terrorize the residents left in this historic neighborhood called Westview Village."

Bloomberg - "U.S. Consumers Spent Average of 3.5% Less on Shopping" (11-25-07)

"U.S. consumers spent an average of 3.5 percent less during the post-Thanksgiving Day holiday weekend than a year earlier as retailers slashed prices to lure customers grappling with higher food and energy costs. Shoppers spent $347.44 on purchases from Nov. 22 through today, choosing to buy less-expensive digital-photo frames and cashmere sweaters, the National Retail Federation said today in a statement. Store visits increased 4.8 percent."

The New York Times - "A Time for Bold Thinking on Housing" (11-25-07)

"Bankruptcy law is a risk management institution, and such an institution should adopt more modern practices. For example, Andrew Caplin, professor of economics at New York University, has proposed that in personal bankruptcy proceedings, the courts should be allowed the latitude to substitute real estate equity — a share in the ownership of the property, to be realized when it is eventually sold — for first mortgage debt. This could let troubled borrowers stay in their homes, and might be better in terms of efficient risk sharing: it would provide incentives for the mortgage industry and would be friendlier to prospective home buyers who would otherwise face higher mortgage rates to pay for others’ bankruptcies."

The Washington Post - "At Home, but Not in Their Own" (11-25-07)

"The run-up in home prices during the real estate boom -- and now the housing market's dramatic reversal -- have sparked a new breed of resident in the Washington area, one more commonly found in New York: the renter by choice. Many of these die-hard renters regard themselves as winners as they watch home prices fall in parts of the country and homeowners struggle to pay their adjustable-rate mortgages."

Los Angeles Times - "USC outgrowing its neighborhood" (11-25-07)

"As USC attracts a substantially higher number of students from out of the state and nation, more students are moving into areas around the campus that used to be considered too distant or too unsafe, and developers are eagerly courting renters willing to pay for the convenience of skateboarding to chemistry class. The results have included complicated demographic shifts, zoning disputes and debates about how to balance the needs of USC's burgeoning off-campus residential population with those of longtime residents, including middle-class homeowners and low-income renters."

Orange County Register - "Gradually greener real estate" (11-25-07)

"The brownstones going up next to the Orange train depot look pretty much like most other townhomes being built these days: boxy, three-story affairs with modern, airy kitchens, deluxe master suites, walk-in closets and price tags north of a half-million greenbacks. But take a look at the top floor. Here, where pigeons roost, rows of black solar panels are affixed to gray asphalt rooftops, converting sunshine into enough juice for one-fifth to half of each home's electricity needs. That's a potential savings of up to roughly $40 a month on the average electric bill."

Los Angeles Times - "
Fire retardants that protect the home" (11-25-07)

"Manufacturers of products such as Safe-T-Guard have seen interest soar in the wake of the fires. And San Diego-based Fire Etc. reports that sales of some of its home fire-retardant products have doubled in recent weeks. There are many fire-retardant products available in California, but few are widely marketed to consumers. Garrett learned about Safe-T-Guard through his work as a textile specialist on film sets, where he treated fabrics with the liquid to protect them from open flame. Realizing how useful the product could be, he decided to keep some in case of emergency."

Los Angeles Times - "
Pocket condo complexes catch on with young professionals" (11-26-07)

There are no hard data on how rapidly the number of small condo complexes has grown -- firms that track the real estate market generally cut off their research at 10 or 20 units. But there is some evidence of the growing trend. For example, Vigen Onany & Associates Inc., a La Crescenta real estate consulting firm that has put together budgets for homeowners associations at hundreds of condominium projects, claims to handle roughly 50% of that market and has done budgets for more than 1,200 small projects since 2000. That year, the firm said, it put together association budgets for 160 developments of 10 units or fewer in Southern California. Last year, that number reached 650, up from 400 a year earlier. It has since backed off to just 350 projects so far this year."

Yahoo - "Have We Seen Worse of Mortgage Crisis?" (11-24-07)

"In the months ahead, millions of other adjustable-rate mortgages like Colombo's will reset, giving them a higher interest rate as required by the loan agreements and leaving many homeowners unable to make their payments. Soaring mortgage default rates this year already have shaken major financial institutions and the fallout from more of them, some experts say, could spread from those already battered banks into the general economy."

The Washington Post - "Crunch May Hit Insurers Of Bonds" (11-24-07)

"Investors already burned by turmoil from the credit crunch are now worried about unwanted surprises in the industry that insures bonds. In the face of mounting losses in U.S. mortgages, rating agencies are reviewing eight leading bond insurers, which could lead to downgrades. Such a move could ripple across the financial sector, because if a bond insurer is downgraded, most of the securities it has blessed as virtually risk free are likely to follow. That could spark a new round of sell-offs and write-downs." - "The four stages of Home Seller Sickness" (11-24-07)

"An exasperated Ann Guiberson, head of the Pinellas Realtor Organization, says asking prices are up over last year by a few thousand dollars. How can that be?We’re stuck in a Florida-wide housing retraction with talk of 25 percent price declines in the air. Call it Home Seller Sickness. I had the affliction earlier this year when I sold my house after wrestling with the dead-weight market for more than half a year. The disease has four stages, ranging from prickly denial to glum acceptance..."

Los Angeles Times - "Low-income housing backer in Anaheim won't give up" (11-24-07)

"Plans for the housing project near Disneyland unraveled last month when the deal between SunCal Cos. and the owners of the 26-acre parcel near Disneyland fell through. That news prompted Councilwoman Lucille Kring earlier this month to withdraw her support of the proposal. Kring cast the tiebreaking vote in a 3-2 decision seven months ago that approved the 1,500-unit project -- sparking three ballot initiatives, two lawsuits and regular City Hall protests."
Associated Press - "Dollar Continues to Plumb Depths" (11-23-07)

"The dollar plumbs new depths in thin trading Friday with record lows against the euro and a 12-year low against the yen on speculation that the American credit crisis will lead to another U.S. interest rate cut."

Bloomberg - "Greenspan Has No `Regrets' as Housing Slump Deepens" (11-23-07)

"Former Federal Reserve Chairman Alan Greenspan said he has 'no particular regrets' and that the deepening slump in the U.S. housing market isn't a result of his policies. 'Markets are becoming aware of the fact that the decline in house prices is not stopping,' Greenspan said today in Oslo. 'I have no particular regrets. The housing bubble is not a reflection of what we did, as it is a global phenomenon.'"

Bloomberg - "Freddie Mac Risks Larger Credit Losses, Moody's Says" (11-23-07)

"Freddie Mac, the second-largest U.S. mortgage-finance company, may report wider losses than it forecast as the slump in credit markets worsens, Moody's Investors Service said. Freddie Mac, which reported this week a record loss of $2.02 billion for the third quarter earlier this week, may have underestimated when it projected that 0.11 percent of the debt it guarantees will go bad in the next two years, Moody's analysts Brian Harris and Craig Emrick said in a report." - "GM will no longer prop up GMAC LLC" (11-23-07)

"The November 2006 agreement to sell 51 percent of GMAC to a group led by Cerberus Capital Management LP ended any need to fund GMAC beyond $1 billion, Randy Arickx, GM's executive director of investor relations, said this week. GM has lost a third of its market value since Nov. 1, when GMAC reported a $1.6 billion loss from subprime mortgages at its Residential Capital subsidiary." - "Unsigned letter accuses agent of mortgage fraud" (11-23-07)

"An agent for Re/Max International, Polin was honored at the company's convention in Atlanta last March with the Chairman's Club Award. That put her in an elite group - fewer than 1,400 of Re/Max's 120,000 agents worldwide - who had gross commissions last year of at least $500,000. It was an impressive feat at a time when Florida home sales and prices were dropping dramatically. But now Polin, a member of the Re/Max Hall of Fame, is accused of owing at least some of her success to mortgage fraud."

Orange County Register Blog - "Option One gets $350 million in additional financing" (11-23-07)

"Option One Mortgage Corp. in Irvine got an additional $350 million in financing available to fund servicing advances through lender Greenwich Capital Financial Products Inc., according to an SEC filing by parent company H&R Block Inc. The amended agreement, signed Nov. 16, gives Option One access to $750 million to fund servicing advances, up from $400 million before."

Orange County Register Blog - "O.C. buyers rush to $417,000 mortgages" (11-23-07)

"DataQuick’s come up with a curious stat that shows what home shoppers must do to finance a home these days. The numbers show a stunning increase in use of loans for exactly $417,000 — the maximum size bought by government-sponsored mortgage packagers, Fannie Mae and Freddie Mac."

Los Angeles Times Blog - "Blaming 'Banks Gone Wild'" (11-23-07)

"Worthwhile reading this weekend: Paul Krugman's column in The New York Times headlined, 'Banks gone wild.' Krugman looks at the mortgage mess and sees, at its core, a failure of corporate governance. How else to explain that CEOs who damaged their companies with bad bets on mortgage-backed investments still made out like bandits?"

CNN - "
Japan's banks take $2.1B mortgage hit" (11-23-07)

"Japanese financial institutions lost as much as $2.1 billion from investments related to risky U.S. housing loans in the first half of fiscal 2007, according to a government estimate published by Japanese newspapers Friday."

Friday, November 23, 2007

Bloomberg - "Global Derivatives Market Expands to $516 Trillion" (11-22-07)

"The market for derivatives grew at the fastest pace in at least nine years to $516 trillion in the first half of 2007, the Bank for International Settlements said. Credit-default swaps, contracts designed to protect investors against default and used to speculate on credit quality, led the increase, expanding 49 percent to cover a notional $43 trillion of debt in the six months ended June 30, the BIS said in a report published late yesterday."

The Washington Post - "News Gets Worse for Freddie As Shareholders File Lawsuit" (11-22-07)

"One day after reporting a $2 billion quarterly loss, Freddie Mac found itself the target of a shareholder lawsuit accusing the mortgage-funding giant of misleading investors about its risk-management practices. The lawsuit in a Manhattan federal court seeks damages on behalf of investors, and it comes after a formal investigation by New York State Attorney General Andrew M. Cuomo into loan appraisals for banks that sold mortgages to Freddie Mac and its larger rival Fannie Mae."

Los Angeles Times - "Existing-home sales decrease in 46 states" (11-22-07)

"Sales of existing homes fell in 46 states during the July-September quarter in a worsening of the housing market's slump, a real estate trade group reported Wednesday. The third-quarter figures from the National Assn. of Realtors underscore the severity of the housing market's slump, which has economists increasingly pessimistic about the economic outlook."

Real Estate Journal - "Freddie Mac Posts Deep Loss, Says It May Slash Dividend" (11-22-07)

"Freddie Mac, sucked into the downward spiral of the U.S. housing and mortgage markets, reported a loss of $2 billion for the third quarter and said it is 'seriously considering' a 50% cut in its fourth-quarter dividend."

Wednesday, November 21, 2007

NAR - "Median Home Prices Rise in Most Metros; Majority Show Modest Gains" (11-21-07)

"The vast majority of metropolitan areas showed rising or stable home prices in the third quarter with most experiencing modest gains compared with a year earlier, despite a broad decline in existing-home sales, according to the latest quarterly survey by the National Association of Realtors®."

CBIA - "California New Home Market Shows No Improvement, CBIA Announces" (11-21-07)

"The pace of home sales at California new-home communities remained sluggish in September, the California Building Industry Association reported today. The monthly CBIA/Hanley Wood Market Intelligence (HWMI) New Home Sales and Pricing Report showed that new home sales in September were 45 percent below September 2006, similar to the year-over-year decline seen last month. During September, 3,394 homes and iniums were sold in the subdivisions tracked by Costa Mesa-based HWMI, compared to 6,220 in September 2006. Sales of single family homes dropped by 39 percent, sales of townhomes and “plexes” – duplexes, triplexes, etc. – were down 36 percent and sales of iniums were down 65 percent."

CBIA - "California Is Still Home to Nation’s Least Affordable Housing" (11-21-07)

"Despite falling home prices throughout most of the state, California remains the nation’s least affordable market for housing in the third quarter, the California Building Industry Association reported today. The quarterly NAHB/Wells Fargo Housing Opportunity Index, compiled by CBIA’s sister organization, the National Association of Home Builders, found that homes were less affordable in 13 of the state’s metropolitan areas when compared to the second quarter, while affordability inched upwards in 15."

Mortgage Bankers Association - "Mortgage Applications Decrease In Latest MBA Weekly Survey" (11-21-07)

"The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending November 16, 2007. The Market Composite Index, a measure of mortgage loan application volume, was 681.7, a decrease of 3.6 percent on a seasonally adjusted basis from 707.3 one week earlier. On an unadjusted basis, the Index decreased 5.2 percent compared with the previous week and was up 9.8 percent compared with the same week one year earlier."

Bloomberg - "U.S. Notes Surge as Stocks Drop; Ten-Year Yield Falls Below 4%" (11-21-07)

"U.S. Treasuries surged, sending 10- year yields below 4 percent for the first time in more than two years, as a decline in global stocks spurred demand for the safety of government debt. Notes climbed as U.S. stock futures dropped to near three- month lows and oil approached $100 a barrel. The spread, or difference in yield, between two- and 10-year Treasuries widened to the most since January 2005 as investors favored safer, shorter-dated assets."

Yahoo - "As New Home Sales Stall, Deals Abound" (11-21-07)

"On Nov. 20, the residential real estate industry seemed to finally get an unexpected dose of much-needed good news. After four consecutive months of declines, the number of new homes being built crept up by a stronger-than-expected 3% in October, according to the Commerce Dept."

Bloomberg - "U.S. Two-Year Interest-Rate Swap Spread Reaches 19-Year High" (11-21-07)

"The price to exchange fixed for floating interest-rate payments for two years surged to the highest since at least 1988 as banks' borrowing costs rose and speculation grew that credit-market losses will deepen. The jump in the so-called interest-rate swap spread comes as Freddie Mac, the second-largest U.S. mortgage finance company, said yesterday it would seek to add reserves amid the worst housing slump in at least 16 years. The three-month dollar-denominated London interbank offered rate, a key indicator of banks' willingness to lend, rose a sixth day."

Orange County Register "Orange County home prices and sales" (11-21-07)

"For the 22 business days ending November 8, sales for all types of Orange County home sales decreased 43.5 percent. The median sales price decreased 8.6 percent. The median is where half the homes sold for more and half for less. Types of homes selling, as well as home value changes, cause the median to change."

Real Estate Journal - "Price Cuts Put Builders in a Bind" (11-21-07)

"When freebies like granite countertops and no-cost closings didn't woo enough buyers, many home builders began trying to outdo one another with price cuts. Now the tactic appears to be backfiring. Potential home buyers are proving unwilling to purchase homes until prices stabilize, fearing further price depreciation, so builders have not gotten the sales volume needed to compensate for their reduced margins."

Real Estate Journal - "Freddie Mac Posts Deep Loss, Says It May Slash Dividend" (11-21-07)

"Freddie Mac, sucked into the downward spiral of the U.S. housing and mortgage markets, reported a loss of $2 billion for the third quarter and said it is "seriously considering" a 50% cut in its fourth-quarter dividend."
NAR - "Commercial Real Estate Index Levels Out in Third Quarter" (11-20-07)

"The Commercial Leading Indicator for Brokerage Activity* slipped 0.1 percent to an index of 120.6 in the third quarter from a record reading of 120.7 in the second quarter, but remains 0.7 percent higher than the third quarter of 2006 when it stood at 119.7. The dip follows nine consecutive quarterly increases; NAR’s track of the index dates back to 1990."

NAHB - "Increase In Multifamily Construction Lifts Total Housing Starts In October" (11-20-07)

"A bounce-back in the volatile multifamily market lifted total housing starts 3.0 percent in October to a seasonally adjusted annual rate of 1.229 million units as the downswing in the single-family housing market continued, according to figures released by the Commerce Department today. Total starts were down 16.4 percent from a year earlier. Single-family housing starts dropped 7.3 percent for the month to a seasonally adjusted annual rate of 884,000 units, the lowest monthly production rate since October 1991 and 25.1 percent below October 2006."

CNN - "D.R. Horton Swings to 4Q Loss" (11-20-07)

"Homebuilder D.R. Horton Inc. said Tuesday it swung to a loss in the fourth quarter as the company again wrote down the value of unsold homes and land options, and the housing market showed few signs of improvement."

Bloomberg - "Freddie Posts Loss, May Cut Dividend; Shares Plunge" (11-20-07)

"Freddie Mac fell 29 percent, the biggest decline since it went public in 1988, as the second- largest U.S. mortgage-finance company posted a record loss, warning of a possible dividend cut and the need to raise capital. The worst housing slump in 16 years caused 'significant deterioration' in the third quarter that will continue through year-end, McLean, Virginia-based Freddie Mac said in a statement. The net loss was $2.02 billion, or $3.29 a share, three times what some analysts estimated."

CNN - "Single family home starts at 16-year low" (11-20-07)

"The collapse in home building continued in October as single-family home starts fell to a 16-year low and permits for all types of new homes dropped to levels not seen since 1993, according to the government's latest reading on the state of the battered home building market released Tuesday. While overall housing starts edged up to an annual rate of 1.23 million from 1.19 million in September, topping forecasts, that was due to a blip of sorts, a 46 percent spike in the more volatile starts in buildings with five or more housing units."

Bloomberg - "Credit Market Collapse Claims Victims as Lawyers Exit" (11-20-07)

"New York law firms are cutting associates for the first time since 2001 as the collapse of the subprime mortgage and credit markets causes private equity deal volume and structured finance work to slow. Clifford Chance, the world's highest-grossing law firm, dismissed six senior associates who worked on mortgage-backed securities in its structured finance practice on Nov. 5. At least two other firms asked associates, or salaried lawyers, to take sabbaticals or switch departments, a move that often precedes job cuts. Partners, about one-fourth of the attorneys at the biggest firms, may also face some belt tightening."

Bloomberg - "Northern Rock Declines on Doubts Over Bank's Value" (11-20-07)

"Northern Rock Plc, the U.K. bank bailed out by the Bank of England, slumped for a second day in London trading after saying that bids are 'materially below' its market value. The stock fell 6.9 percent to 97 pence, valuing the Newcastle, England-based company at 409 million pounds ($845 million). New York-based buyout firm J.C. Flowers & Co. is proposing to buy Northern Rock for a nominal sum in return for recapitalizing the company and paying off some of its debt, a person familiar with the plan said today."

Bloomberg - "Citigroup, Bank Credit Swaps Rise on Subprime Concern" (11-20-07)

"The risk that banks and brokerages from Citigroup Inc. to Bear Stearns Cos. will default on their debt is accelerating as analysts increase their estimates of losses from subprime mortgages, credit-default swaps show. Contracts on New York-based Citigroup, the largest U.S. bank by assets, rose 16 basis points to 95 basis points over the past two days, according to broker Phoenix Partners Group, setting a record today for the seventh time this month. Contracts on Bear Stearns have climbed 27 basis points the past two days to 177 basis points, the highest in at least six years. A rise signals investors are less confident in a company's creditworthiness."

Bloomberg - "At Subprime Event Too Early to Tell Who'll Survive" (11-20-07)

"They dubbed it 'The Survivors' Conference.' In early November, 2,000 people who handle asset- backed securities for a living crowded into a ballroom at the JW Marriott hotel in Orlando, Florida, just 3 miles from Disney World, to hear speaker after speaker explain why 2008 may be their worst year ever. The subprime crisis, which has claimed the jobs of three chief executive officers and prompted more than $45 billion in writedowns at the world's biggest banks, may end up spilling into 2009."

Orange County Register - "Developer banks on Seal Beach" (11-20-07)

"SEAL BEACH Steve Zubieta wanted a change in lifestyle for his family, but not too much of a change. He moved from his four-bedroom home in Seal Beach's College Park to one of six new homes – also in Seal Beach. His house is one of six two-story homes going for $1.75 million to $1.85 million that private developer Randy Allison just put on the market. The homes, on Fifth Street and Central Avenue, were built on the site of the former Seal Beach Inn and Gardens, a landmark downtown bed and breakfast. As home sales remain stale throughout Orange County, new homes in beach towns, like those in Seal Beach, are likely to sell sooner than later, analysts said."

eFinanceDirectory - "Home Prices Decline in 17 U.S. States" (11-20-07)

"First American LoanPerformance released its monthly Home Price Index (HPI) yesterday. The LoanPerformance HPI tracks prices in 7,416 zip codes, 956 Core Based Statistical Areas (CBSA), and 659 counties across the U.S. Because this HPI incorporates more than 30 years of repeat sales transactions, it is considered to be one of the most comprehensive indices available in the industry." - "Collecting, Interpreting and Disseminating Real Estate Data" (11-20-07)

"The San Francisco-Oakland-Fremont Metropolitan Statistical Area approximation has 21,363 total listings of which 18,227 are either Single Family or Condo homes (browse San Francisco homes). The area includes the major cities of Berkeley, Concord, Daly City, Fremont, Hayward, Oakland, Redwood City, Richmond, San Francisco, San Mateo and many others."

Tuesday, November 20, 2007

Bloomberg - "Bond Market to Fed: Recession Threat Means More Cuts" (11-19-07)

"The headline in the financial futures market these days says Federal Reserve Chairman Ben S. Bernanke is withholding some vital information: The economy is so bad the central bank will have to lower interest rates at least three-quarters of a percentage point to avoid a recession."

The Press Enterprise - "From dreams to debt" (11-19-07)

"Investors say they expected to cash in on the hot real estate market when they entrusted money to a company in Murrieta. Instead, many are losing their homes and facing bankruptcy."

Bloomberg - "Housing Market's Stench Means Cut Price to Sell" (11-19-07)

"Raffles, festive balloons, open houses, car giveaways. Will any of these incentives sell houses? Not at the moment. You don't have to be particularly creative in a market glutted with homes for sale. The painful reality is that homes are commodities. There are more than 4 million of them sitting out there unsold and more coming on the market every day due to foreclosures. If you really need to sell a house, price is the one lever that will move a property."

Business Week - "The Economy's $2 Trillion Worry" (11-19-07)

"Just a few months ago, analysts believed the collapse of subprime mortgage securities and related investments would lead to losses of $50 billion to $100 billion, a large but manageable number. Now, a new report from Goldman Sachs (GS) says losses from subprime exposure could be much larger than recently assumed, hitting as much as $400 billion. But that's not the extent of the financial carnage: Goldman said the full impact on the economy could be even more substantial, because the losses could compel banks and other lenders to curtail lending by as much as $2 trillion."

The Baglady - "San Mateo Home Sellers in Trouble" (11-19-07)

"Well, it’s been two weeks since the last update and in the last fourteen days about 305 homes in San Mateo County were listed on Redfin. This time 59 homes qualified as home sellers in trouble. This is nearly 20% of all the new listings in San Mateo! Quite a few of these homes are marked as lender owned. Here are some highlights..."

The Standard - "Six more hard years tipped for subprime fallout" (11-19-07)

"The US subprime crisis will continue for years to come and America may be facing a permanent decline as an economic power, famed investment guru Jim Rogers said over the weekend. 'The situation is going to continue to deteriorate,' he said in Hong Kong. 'When you have a bubble, it normally takes years to work out all the ramifications.' The subprime crisis is not over, Rogers said."

Bloomberg - "Slowing Economy Proves Fitzgerald Wrong: Rich Aren't Different" (11-19-07)

"F. Scott Fitzgerald had it wrong: In a slowing economy, the rich aren't that different from everyone else. Affluent consumers, pinched by shrinking stock portfolios, falling property values and smaller bonuses, are behaving like their less-well-off peers: They're reining in spending. That portends a steeper slowdown than originally forecast for the U.S. economy, or even a recession, because the richest fifth of American households accounts for almost 40 percent of consumer spending, the main engine of economic growth."

NAHB - "Builder Confidence Remains Unchanged In November" (11-19-07)

"Builder confidence in the market for new single-family homes remained unchanged in November due to continuing mortgage market problems, a substantial inventory overhang and ongoing concerns about the effects of negative media coverage, according to the latest National Association of Home Builders/Wells Fargo Housing Market Index (HMI), released today. The November HMI held even with October’s upwardly revised 19 reading, its lowest point since the series began in January of 1985."

Mortgage Bankers Association - "MBA, ALTA and AEA Develop Standardized Instructions for Mortgage Transactions" (11-19-07)

"The Mortgage Bankers Association (MBA), American Land and Title Association (ALTA) and American Escrow Association (AEA) today announced that they have developed uniform closing instructions to be used in future mortgage transactions. The instructions are being proposed to members for their comment. The purpose of these documents is to improve efficiencies and lower costs to the industry and consumers by replacing countless sets of instructions with two standard sets. The instructions will also help stem mortgage fraud and facilitate automated mortgage originations. The new general instructions will detail the requirements for all transactions and the specific instructions will provide a standard format for the details of each transaction including borrower(s) names, property address, loan type, etc. When the instructions are finalized they will not be required to be used by lenders but they are likely to be widely accepted."

Forbes - "Subprime Loss Is Swiss Re's... Loss" (11-19-07)

"Three weeks ago, a set of sturdy third-quarter results from Swiss Re made the world's biggest 'insurer for insurers' look like a shining beacon of safety among a storm of multibillion-dollar write-downs at financial institutions. But the Zurich-based reinsurance giant dropped a bomb on Monday morning, announcing that in the month of October a single client it had been insuring had seen its investment portfolio drop in value, and Swiss Re would have to pick up the bill."

Bloomberg - "Impac to `Significantly' Raise Loan-Loss Provisions" (11-19-07)

"Impac Mortgage Holdings Inc., the California home lender that ceased most lending two months ago, said it will 'significantly' increase its loan-loss provisions as rising mortgage defaults hamper U.S. debt markets. Impac disclosed to the U.S. Securities and Exchange Commission last week that it will delay the filing of its quarterly report until mid-December because it needs more time to tally the discontinued operations, the Irvine, California-based company said in a statement today."

Real Estate Journal - "House Passes a Bill Curbing Mortgage Brokers" (11-19-07)

"The House passed legislation to give more protection to home-mortgage borrowers, but deadlocks in the Senate make it unlikely that such a measure can be enacted into law before next year, in the latest sign Congress is struggling to address the nation's mortgage crisis."
Orange County Register - "RealtyTrac must do better" (11-18-07)

"RealtyTrac has now developed a unique way to watch foreclosures. It just doesn't seem to want to use it. The Irvine tracker of foreclosures' original mission was a massive task: a nationwide database of homes in financial distress. This chore requires juggling local filing quirks for the public paperwork that starts, continues and completes a foreclosure. The eye-catching result of RealtyTrac's work are monthly reports on the national foreclosure picture. Previously, the most widely quoted stat was produced from a quarterly survey of mortgage makers by the Mortgage Bankers Association trade group."

Orange County Register - "Tracking the truth on foreclosures" (11-18-07)

"Since RealtyTrac began putting out the news releases in 2005, the number of unique visitors to its Web site has tripled to 3 million a month, said Rick Sharga, RealtyTrac's vice president of marketing. That's hugely important for the company because selling foreclosure listings through its Web site is how RealtyTrac makes money. But questions are being raised about whether the firm's oft-cited numbers overstate the real dimensions of the foreclosure problem. And that could create a problem for the company's credibility." - "Homebuilders reconsider price cuts" (11-17-07)

"When freebies like granite countertops and no-cost closings didn't woo back buyers, homebuilders began trying to outdo one another with bigger and better price cuts. But now, the tactic may have backfired. The reductions, builders complain, have sliced into already thin margins. And buyers, fearful their houses will depreciate faster than a new car, won't make purchases until prices stabilize."

The San Diego Union Tribune - "Economists employ 'R' word on jobs data" (11-17-07)

"The slumping housing market led to thousands of job losses throughout California last month, prompting fears that the state and local economies are lurching into a recession. California lost 15,800 jobs and San Diego County lost 1,700 in October, according to seasonally adjusted data released yesterday by the state Economic Development Department."

The Arizona Republic - "Canadians get edge in real-estate buys" (11-17-07)

"Who knew that the loonie would come to the aid of Scottsdale's tepid real-estate market? The loonie refers to the Canadian dollar, which is giving our neighbors to the north increased buying power. Realtors here say that Canadian buyers increasingly are showing interest in houses here as winter residences and investments."

Forbes - "Atlanta Fed's Lockhart says Southeast housing 'too much of a good thing'" (11-17-07)

"The Southeast region of the United States 'recently has begun to suffer from too much of a good thing when it comes to housing,' Atlanta Federal Reserve Bank President Dennis Lockhart said today. Builders, lenders and others didn't see the end of the 2001-2005 housing boom coming, he said, and 'in the aftermath of residential overbuilding, a painful adjustment is taking place with house prices stagnant or declining and housing starts dropping sharply in many areas in the region.'"

MSNBC - "Fed and markets set to clash" (11-17-07)

"The risk of a collision between the Federal Reserve and the markets grew on Friday after Fed governor Randall Kroszner made it clear that the US central bank was not planning to cut interest rates at its next policy meeting, but was largely ignored by investors. Mr Kroszner said: 'the downside risks to growth now appear to be roughly balanced by the upside risks to inflation' and added that data and information since the Fed's October meeting 'have not changed my thinking in this regard.'"

Orange County Register - "How to snag higher-paying renters" (11-17-07)

"When The Lakes complex opened in Costa Mesa in 1987, it had all the conveniences of modern apartment living, including two swimming pools, tennis courts and a fitness center set amid landscaped lakes and streams. But while The Lakes remained pretty much the same over the past 20 years, the surrounding South Coast Metro area grew up. The $240 million Renée and Henry Segerstrom Concert Hall opened with great fanfare across the street last year, and South Coast Plaza, a few blocks away, went through its own $35 million facelift to give it a more contemporary look."

KSBY - "Locals tour foreclosed homes: experts say now is the time to buy
" (11-17-07)

Potential buyers hopped on a tour bus Saturday and got a glimpse of some of the bank-owned properties available in San Luis Obispo County. Along the way they picked up valuable advice on purchasing a foreclosed home. According to some local experts, now is the ideal time to buy a home on the Central Coast."

Friday, November 16, 2007

The Herald Tribune - "Treasury chief Paulson says US will continue 'strong dollar' policy" (11-16-07)

"U.S. Treasury Secretary Henry Paulson expects more of the losses in the U.S. mortgage industry that have hit the dollar, but predicted a long-term recovery for the battered currency. 'We have very much a strong dollar policy; that's in our nation's interests,' he said in a South African radio interview, Dow Jones Newswires reported. 'Our economy, like any other, has its ups and downs and its long-term strength will be reflected in our currency markets.'"

Reuters - "CHRONOLOGY-The credit crunch of 2007" (11-16-07)

"The credit market turmoil of 2007 has seen banks register writedowns and losses totalling more than $50 billion and experts see no sign of let up this year. Following is a timeline of events..."

Bloomberg - "Fed's Kroszner Says `Rough Patch' Won't Warrant Cuts" (11-16-07)

"Federal Reserve Governor Randall Kroszner said policy makers probably won't need to reduce interest rates further to help the economy weather a 'rough patch' in the coming year. 'The current stance of monetary policy should help the economy get through the rough patch during the next year, with growth then likely to return to its longer-run sustainable rate,' Kroszner said today in a speech in New York. Data consistent with such growth 'would not, by themselves, suggest to me that the current stance of monetary policy is inappropriate.'"

Bloomberg - "Fannie Mae Plunges on Concern About Credit Losses" (11-16-07)

"Fannie Mae tumbled, heading for its biggest two-day drop since 1987, after executives at the mortgage- finance company failed to ease investor concern that it may have downplayed credit losses. Fannie Mae fell $2.33, or 5.4 percent, to $40.90 at 12:46 p.m. in New York Stock Exchange composite trading after dropping to as low as $36.86 earlier in the day. The shares were pushed down 10 percent yesterday after a Fortune magazine article said Washington-based Fannie Mae altered how it measures the impact of mortgage foreclosures in a way that understates losses."

Yahoo - "Fannie Execs Defend Accounting Change" (11-16-07)

"Fannie Mae executives on Friday defended a change in the way the mortgage finance company calculates losses on home loans, responding to analysts' concerns as its stock price fell. Shares of Fannie, the largest U.S. buyer and backer of home loans, fell more than 4 percent. They recovered from an earlier dive of more than 16 percent and a decline of 10 percent the day before."

Reuters - "Auditors set to ensure banks don't mark to myth" (11-16-07)

"In the backwash of the credit crisis, U.S. and European banks have revealed more than $50 billion of writedowns and losses from U.S. subprime mortgage loans, leveraged loan commitments and other assets since the end of August. Big chunks of those writedowns are based on mark-to-model valuations, which banks must justify to their auditors."

Los Angeles Times - "Housing near Bolsa Chica wetlands OKd" (11-16-07)

"After years of bitter argument and compromises, the state Coastal Commission has cleared the way for a developer to build about 175 homes near the Bolsa Chica wetlands. It is a small victory for the developer, who had hoped to build 268 homes in what was once a part of the wetlands in Huntington Beach. But the vote most likely won't end the skirmishes between builders and preservationists."

Los Angeles Times - "Home prices fall in Bay Area" (11-16-07)

"Reluctant buyers and tightened mortgage lending combined to drag down October's home sales in a nine-county region around San Francisco Bay to the lowest level in more than 20 years, a real estate research firm said Thursday. A total of 5,486 homes were sold in the region last month, down 35.7% from 8,532 in October 2006, according to DataQuick Information Systems. Sales increased 9.4% from September. It was the slowest October since DataQuick began keeping records in 1988. The previous low came in October 1990, when 6,443 homes were sold. The sales average for the month of October is 8,930 homes."

Forbes - "The Fed's Economy: Too Good To Be True?" (11-16-07)

"A fair bet for Tuesday's Fed rate decision is a quarter-point reduction in the federal funds. Otherwise, there's liable to be a run for the exits by panicky investors. With oil above $80 a barrel and gold above $700 an ounce, the status quo can't be what Chairman Bernanke thinks is the proper course of action. But truth is, we have a long way to go in the unwinding of leverage; the solvency issues among borrowers, builders and mortgage providers; the onslaught of credit downgrades; and the recalibrating of terms on multibillion-dollar private equity takeovers. Proof of the pudding: The Bank of England and the European Central Bank are having to pour reserves into troubled spots in the financial system."

Forbes - "If There's A Recession?" (11-16-07)

"The market's already celebrating a 50 basis point cut in the Fed Funds rate, which Ben Bernanke may deliver on Tuesday. Unless you can creep into the head of a Fed chairman and know what he's going to do before he does, find some other work. I'm sticking with my call for a weak economy but no recession--I could be wrong. All the economists missed the inflection point of the employment stats which turned negative, not the 100,000 job creation consensus. There's more to come. At least 100,000 layoffs in the construction-mortgage servicing sector will percolate through the next few months."

Thursday, November 15, 2007

DQNews - "California October 2007 Home Sales" (11-15-07)

"A total of 24,832 new and resale houses and condos were sold statewide last month. That's up 5.6 percent from 24,460 for September, and down 40.9 percent from 43,720 for October 2006. Last month's sales made for the slowest October in DataQuick's records, which go back to 1988. On a year-over-year basis, sales have declined the last 25 months."

Bradenton Herald - "Is relief in sight for housing market?" (11-15-07)

"There's one question that real estate agents and prospective buyers alike are asking: Has the housing market hit bottom? Opinions are split, but according to the Manatee County Multiple Listing Service, the glut of homes on the market appears to have plateaued and has been ebbing downward since the high-water mark in March."

Bloomberg - "Barclays Writes Down $2.7 Billion on Mortgage Losses" (11-15-07)

"Barclays Plc, the U.K.'s third-biggest bank, wrote down about 1.3 billion pounds ($2.7 billion) of credit-related securities tied to the U.S. subprime-mortgage market collapse. Net charges and writedowns were 500 million pounds in the third quarter and 800 million pounds in October, Barclays said in a statement today. Citigroup Inc., Merrill Lynch & Co. and Morgan Stanley all announced writedowns in the past month after Moody's Investors Service downgraded $10.3 billion of U.S. collateralized debt obligations, most of them linked to U.S. mortgages."

Yahoo - "Real Estate: Buy, Sell, or Hold?" (11-15-07)

"That's the question homeowners are asking in the midst of the worst real estate slump in decades. Our exclusive calculations can help you figure out what your house will be worth in coming years. You can't blame America's homeowners for feeling hopelessly confused. From suburban porches and city terraces, they're gawking at a housing world gone mad. Just 18 months ago, folks on a tony Linden Lane or a leafy Boxwood Court were astounded to see the colonial their neighbors bought for $600,000 in 2000 sell for $1.5 million after multiple bids. Now they're just as bewildered to watch the same across the street go begging for months at $1.1 million without a single offer."

The San Diego Union Tribune - "Budget-gap forecast spurs a call to arms" (11-15-07)

"A grim forecast that the state budget shortfall will grow to nearly $10 billion over the next two years produced calls yesterday for prompt and painful action to begin closing the gap now. A troubled housing market and a soft economy are the big reasons for lower tax-revenue projections, while a $500 million, court-ordered payment to a teacher pension fund on top of last month's devastating wildfires and other problems have driven up costs."

The San Diego Union Tribune - "Prices fall in all corners of Southern California" (11-15-07)

"Home prices fell last month in all six major Southern California counties for the first time in 12 years, prompting some economists to wonder whether the housing decline will push areas of the state into a recession. But San Diego County, one of the first markets to see a housing downturn, may be among the first to recover, one prominent economist said."

Yahoo - "NovaStar's Shares Plunge on $600M Loss" (11-15-07)

"Many of NovaStar Financial's competitors -- including American Home Mortgage Investment Corp. and New Century Financial Corp. -- have gone out of business this year. NovaStar Financial has laid off much of its staff and stopped issuing mortgage loans this year as the mortgage industry plunged into distress. For the third quarter, NovaStar lost $598 million. This stemmed from various charges reflecting how much value its portfolio has lost."

Orange County Register - "Foreclosures keep rising" (11-15-07)

"Banks foreclosed on 530 homes in Orange County in October, the highest monthly total in more than a decade, DataQuick figures show. The total was up 410 percent from a year ago and 19 percent from September. Foreclosed properties, called 'real estate owned' properties, or REOs, are showing up more often on lenders' books and adding to the inventory of homes for sale in Orange County, brokers say. Short sales – when a lender agrees to accept less than the mortgage owed when a home is sold – are also increasing."

Forbes - "Wells Fargo: All's Not Well" (11-15-07)

"Wells Fargo isn't expecting the housing market to make a comeback anytime soon. 'We have not seen a nationwide decline in housing like this since the Great Depression,' said Wells Fargo Chief Executive John Stumpf. Although Stumpf predicts that credit losses will continue to pile up in 2008, he said the firm was well positioned to weather the crisis. Unlike some on Wall Street, Wells Fargo has little exposure to collateralized debt obligations, risky credit derivatives, that have experienced rapid devaluation in the last few months."

Real Estate Journal - "When Home Builders Hit the Skids Consumers Deal with Uncertainties" (11-15-07)

"In the latest sign of trouble, Ft. Lauderdale, Fla.-based Levitt & Sons, a unit of Levitt Corp., filed for Chapter 11 bankruptcy protection last Friday, citing the 'sudden and steep' downturn in the Florida housing market. Levitt's move follows bankruptcy filings by a number of local and regional builders, including Neumann Homes Inc. in Illinois, Elliott Building Group in Pennsylvania, Turner-Dunn Homes Inc. in Arizona and Kara Homes Inc. in New Jersey. Many other builders simply close up shop. And the situation is likely to worsen in the first half of next year, says Ivy Zelman, an independent housing analyst. 'We're in the first or second inning,' Ms. Zelman says. 'There are going to be a significant number of insolvent builders.'"

Wednesday, November 14, 2007

DQNews - "Southland home sales plummet" (11-14-07)

"Southern California home sales remained at their lowest level in more than 20 years last month, the result of market uncertainty and a continued drop in 'jumbo' mortgage financing. Prices have dropped back to spring 2005 levels, a real estate information service reported. A total of 12,999 new and resale houses and condos sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties in October. That was up 4.4 percent from 12,455 for the previous month, and down 45.3 percent from 23,745 for October last year, according to DataQuick Information Systems."

Mortgage Bankers Association - "Mortgage Applications Increase as Refis Jump In Latest MBA Weekly Survey" (11-14-07)

"The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending November 9, 2007. The Market Composite Index, a measure of mortgage loan application volume, was 707.3, an increase of 5.5 percent on a seasonally adjusted basis from 670.6 one week earlier. On an unadjusted basis, the Index increased 4.2 percent compared with the previous week and was up 21.8 percent compared with the same week one year earlier."

Yahoo - "Foreclosure Filings Up in Metro Areas" (11-14-07)

"Homeowners across the U.S. are increasingly having trouble making their mortgage payments on time, but borrowers in metro areas of California, Florida and other once-booming housing markets are accounting for the biggest spikes in foreclosure filings, according to a mortgage research company."

CNN - "HSBC takes $3.4B charge on U.S. mortgages" (11-14-07)

"HSBC Holdings PLC said Wednesday it was taking a $3.4 billion charge against third-quarter profits because of accelerating losses in its HSBC Finance Corp. mortgage business in the United States. However, in a trading update the company said that those losses were 'more than offset by revenue growth in the group' as a whole and that third-quarter operating income was up compared with a year ago."

Bloomberg - "Citigroup, Merrill, HSBC Credit-Default Swaps Fall" (11-14-07)

"The risk of financial companies defaulting on their debt fell after Goldman Sachs Group Inc. and Bank of America Corp. stoked optimism that the nation's largest banks may have seen the worst of credit market losses. Credit-default swaps on Goldman Sachs fell 7 basis points to 73.5 basis points, following a drop of 15 basis points yesterday, according to CMA Datavision in London. Citigroup Inc. fell 1.5 basis point to 72.5 basis points, after narrowing 8 basis points yesterday. Merrill Lynch & Co. declined 8.5 basis points to 117.5 basis points, following a 10 basis-point drop."

Bloomberg - "California, Ohio, Florida Cities Lead in Foreclosures" (11-14-07)

"California, Florida and Ohio accounted for more than two-thirds of the 25 metropolitan areas in the U.S. with the highest foreclosure rates as subprime borrowers and property speculators fell behind on adjustable- rate mortgages, RealtyTrac Inc. said. Seventy-seven of the 100 largest metro areas had more foreclosure filings in the third quarter than in the previous three months, according to the Irvine, California-based research firm. California locations accounted for seven of the top 25 foreclosures rates, and Florida and Ohio each had five."

Bloomberg - "Lehman, Bear Stearns Are Ripe for European Offers" (11-14-07)

"A lot of people might chuckle over that sentence. Most bankers would rather buy a slug-and-seaweed sandwich for lunch than take control of institutions drowning in subprime debt. Why pay billions of pounds or euros for a whole heap of trouble? Yet the credit crunch has hit the share prices of all the banks hard, and the dollar is slumping to record lows. That means Wall Street banks cost about as much as the free toy at the bottom of a cereal packet."

CNN - "Fannie Mae's fuzzy math" (11-14-07)

"Investors might want to take a closer look at Fannie Mae's latest earnings report. Lost in the unsurprising news of the mortgage lender's heavy losses was a critical change in the way the company discloses its bad loans -- a move that could mask that credit losses that are rising above levels that the company predicted just three months ago."

Los Angeles Times - "Pending home sales inch up but market remains weak" (11-14-07)

"Pending sales of previously owned U.S. homes unexpectedly rose in September, but the outlook for the housing market remains weak and there are signs consumers have tightened up on spending. Pending home sales rose 0.2% in September but were still more than 20% lower than they were a year earlier, the National Assn. of Realtors said Tuesday. Wall Street economists had expected pending sales to fall 2.8%."