OFHEO - "U.S. HOUSE PRICE APPRECIATION RATE REMAINS SLOW, BUT POSITIVE" (6-1-07)

"The rate of home price appreciation in the U.S. remained slow but positive in the first quarter of 2007. The OFHEO House Price Index (HPI), which is based on data from sales and refinance transactions, was 0.5 percent higher in the first quarter than in the fourth quarter of 2006. This is moderately below the revised growth estimate of 1.3 percent from the third to the fourth quarter of 2006. Prices in the first quarter of 2007 were 4.3 percent higher than they were in the same quarter in 2006."

NAR - "Pending Home Sales Index Shows Market May Be Stabilizing" (6-1-07)

"A forward-looking indicator based on pending home sales shows the housing market could edge down but appears to be in the process of leveling out, according to the National Association of Realtors®. The Pending Home Sales Index*, based on contracts signed in April, stood at 101.4, down 3.2 percent from an upwardly revised March reading of 104.8, and is 10.2 percent lower than April 2006 when it registered 112.9. The revised March index was 10.0 percent below a year earlier."

Bloomberg - "CDO Boom Masks Subprime Losses, Abetted by S&P, Moody's, Fitch" (6-1-07)

"The numbers looked compelling. Buy this investment-grade collateralized debt obligation and you'll get a return of up to 10 percent, Credit Suisse Group said. That was almost 25 percent more than the average yield on a similarly rated corporate bond. Investors snapped up the $340.7 million CDO, a collection of securities backed by bonds, mortgages and other loans, within days of the Dec. 12, 2000, offering. The CDO buyers had assurances of its quality from the three leading credit rating companies --Standard & Poor's, Moody's Investors Service and Fitch Group Inc. Each had blessed most of the CDO with the highest rating, AAA or Aaa."

Bloomberg - "HSBC to Sell Bonds of New Century Subprime Mortgages" (6-1-07)

"HSBC Holdings Plc plans to sell bonds backed by some of the last subprime mortgages made by bankrupt New Century Financial Corp., once its biggest rival in the business. The $1 billion of home loans made by Irvine, California- based New Century that HSBC plans to package and sell as securities on June 5 have an average age of about three months, Fitch Ratings said in a May 29 report. New Century, whose $51.6 billion in lending last year to borrowers with poor credit records or high debt burdens was topped only by London-based HSBC, stopped taking loan applications in early March."

Boston - "Lawyer eyes Ameriquest: Clients: Home loan paperwork faulty" (6-1-07)

"A Rhode Island lawyer claims he has found a chink in the legal armor of subprime mortgage giant Ameriquest, one that could give hundreds of thousands of homeowners grounds to wriggle out of their loans. Attorney Christopher Lefebvre said he is representing 200 current and former Ameriquest homeowners in Massachusetts and other states - many now facing foreclosure - who are suing to undo mortgages taken out through the California-based lender."

Bloomberg - "Bernanke Pulled in Different Directions by Economy" (6-1-07)

"Federal Reserve Chairman Ben S. Bernanke is pulled in opposite directions by worries over inflation and housing, leaving him little choice other than to keep interest rates unchanged. Fed officials said they still expect a pickup in the economy this year and view inflation as their main concern, minutes of their May 9 meeting showed yesterday. They listed several caveats, including the risk that the housing recession may ``weigh heavily'' on growth."

Financial Times - "Funds attack banks’ aid for subprime borrowers" (6-1-07)

"Hedge funds are attacking bank decisions that help delinquent US mortgage borrowers remain in their homes in a move that pits some of the country’s richest people against its least well-off. The dispute centres on derivatives contracts that pay money to investors when bonds backed by subprime mortgage loans – extended to people with past credit problems – run into trouble. The $1,200bn (€890bn) US subprime mortgage bond market has been hit recently by rapidly growing defaults, and hedge funds have profited from the crisis by buying such derivatives."

The San Diego Union-Tribune - "Housing forecast links slump to pump" (6-1-07)

"High gas prices have started to discourage new-home buying and construction in the Inland Empire, the California Building Industry Association said in a report yesterday. Officials released a midyear housing forecast at the group's annual convention in San Francisco that projects 135,000 to 150,000 building permits this year statewide, down from the 155,000 to 175,000 permits the association had projected in January."

LewRockwell.com - "It’s a Mad, Mad, Mad, Mad World" (6-1-07)

"The lure of easy money begins with the government printing press. First, the central banker buys an asset – typically a government debt instrument – writes a check on itself and deposits it into the banking system. Since the bank never 'redeems' the check, this is equivalent to creating money out of thin air. The banker, happy to receive fresh 'reserves,' loans out all but a sliver. This new money ends up back with the banks, is counted again as reserves, mostly lent out, and so on and so on. Through this process of fractional reserve banking, credit is expanded at a multiple of the initial central bank deposit. Through such a system, the creation of money and credit (the promise to pay money) looks like an upside-down pyramid – essentially a pyramid scheme on top of a counterfeiting operation."

CNN - "Mortgage rate rise pressures housing recovery" (6-1-07)

"Mortgage rates went up again this past week, putting more pressure on a weak housing market and further dimming prospects for a quick recovery. Low rates helped create and sustain the last housing boom. And rates remained manageable over the past two years as the market fell, buoying prices and enabling the bubble to deflate gradually rather than with a sharp pop."

eFinanceDirectory.com - "How to Raise Your Voice Against Inappropriate Loan Approvals" (6-1-07)

"Foreclosure activity is at its highest point since The Great Depression. The Center for Responsible Lending is estimating the 2.4 million people will lose their home as a result of adjusting interest rates. There are obviously some people out there who shouldn't have been approved for the loan that they received. It's tragic, because it didn't have to be that way. If borrowers would have been more honest with themselves and with lenders about what they could reasonably afford when the loan was granted, and later when interest rates adjusted, the problem may not be happening."