Thursday, June 12, 2008

Bloomberg - "Lampert Buys KB Home, Centex Stakes as Builders Fall" (6-12-08)

"Lampert's ESL Investments Inc. hedge fund purchased 747,500 shares of Centex, the fourth-largest builder, according to a May 15 filing with the U.S. Securities and Exchange Commission. The shares are valued at $10.8 million at today's closing price. The fund also acquired 605,000 shares of KB Home as of March 31, the fifth-largest, valued at $11.2 million."

Bloomberg - "Thornburg Reports Loss of $3.31 Billion on Writedowns" (6-12-08)

"Thornburg Mortgage Inc., the 'jumbo' home lender that averted bankruptcy in April, said it lost $3.31 billion in the first quarter because of writedowns on securities linked to real estate. The loss before preferred stock dividends was $20.64 a share. That compares with net income of $75 million, or 62 cents a share, a year earlier, Santa Fe, New Mexico-based Thornburg said today in a statement. Chief Executive Officer Larry Goldstone said during a conference call the lender may become profitable this year. "

Bloomberg - "`Dirt Bonds' Soil Oppenheimer in Gambits Gone Awry" (6-12-08)

"Almost $70 million of tax-exempt bonds were sold in June 2007 to build roads and sewers for thousands of new homes planned for Elk Grove, California, once the fastest growing city in the U.S. A year later, the lots are largely vacant and the bonds lost 41 percent of their value."

Orange County Register - "Sellers want more for O.C.’s pricier homes. Again!" (6-12-08)

"May numbers from HousingTracker show a growing tale of two cities for Orange County real estate. At least, from a price standpoint looking at this accompanying chart. We see at the top, so to speak, a 5-month string of sellers raising their typical listing price, as measured by the 75th percentile (median of the top half.) HousingTrack pegs this benchmark for May at $848,500 — up 0.4% from April and down 5.6% from a year ago. All told, the 75th percentile’s asking price is up 6.1% since January."

Orange County Register - "4 builders fined for run-off flaws, 15 O.C. projects cited" (6-12-08)

"Centex, KB Home, Pulte Homes, and Richmond American Homes agreed to pay a total of $4.3 million in penalties to resolve alleged violations of storm water run-off regulations at construction sites in 34 states and the District of Columbia — including 15 in O.C."

Bloomberg - "AIG Investors Seek Ouster of Sullivan After Losses" (6-12-08)

"American International Group Inc. investors holding more than 100 million shares demanded Chief Executive Officer Martin Sullivan be replaced after the world's largest insurer lost 43 percent of its value this year. Former AIG director Eli Broad, Shelby Davis of Davis Selected Advisers LP and Bill Miller of Legg Mason Inc. asked that a board member be named interim CEO while a search committee finds a new leader for New York-based AIG, according to a letter dated yesterday. Company spokesman Chris Winans confirmed AIG received the letter."

Bloomberg - "U.S. Financial Firms Cut Dividends Most in Five Years" (6-12-08)

"Citigroup Inc., Wachovia Corp. and KeyCorp are among 16 U.S. financial firms that slashed dividends this year, a tally that exceeds the previous five years combined. Goldman Sachs Group Inc. and Bank of America Corp. may follow as mortgage-related losses escalate, analysts say. Banks are trying to hang onto capital as the U.S. home market implodes and loan losses soar. KeyCorp, Ohio's third- largest bank, chopped its payout in half today -- the first decrease in 43 years -- and said it must raise $1.5 billion after losing a tax case. The world's biggest financial companies have raised $291 billion to bolster their balance sheets."

Los Angeles Times - "A cold market for jumbo loans shows signs of a thaw" (6-12-08)

"Despite the government's effort to address one of the repercussions of the sub-prime meltdown, jumbo mortgages -- those exceeding $417,000 -- have remained difficult to obtain and relatively expensive. But there are signs of normalcy returning to the jumbo market."

Realty Times - "Real Estate Outlook: Pending Home Sales Rise in April" (6-12-08)

"For much of the past 12 months, the index has trended negative or flat. But the latest index, released this past Monday, was a big surprise. Rather than falling again -- as was widely predicted by Wall Street analysts -- it rose by 6.3 percent on sales contracts signed during April and heading for closings in the next couple of months."

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