Telegraph.co.uk - "China threatens 'nuclear option' of dollar sales" (8-8-07)

"The Chinese government has begun a concerted campaign of economic threats against the United States, hinting that it may liquidate its vast holding of US treasuries if Washington imposes trade sanctions to force a yuan revaluation. Two officials at leading Communist Party bodies have given interviews in recent days warning - for the first time - that Beijing may use its $1.33 trillion (£658bn) of foreign reserves as a political weapon to counter pressure from the US Congress."

Bloomberg - "Subprime `Tsunami' Hits Asset-Backed Commercial Paper Market" (8-8-07)

"Companies are extending payments on commercial paper backed by home loans for the first time as the subprime mortgage crisis spreads to debt perceived to be among the safest in the market, according to Moody's Investors Service. Units of American Home Mortgage Investment Corp., the residential-mortgage lender that filed for bankruptcy, Luminent Mortgage Capital Inc., facing margin calls from lenders, and Aladdin Capital Management LLC, this week exercised an option allowing them to delay repaying the debt, Moody's said."

Bloomberg - "HUD Says Fannie, Freddie Asset Limits May Be Raised" (8-8-07)

"U.S. Housing and Urban Development Secretary Alphonso Jackson said the government is considering raising the limit on home loan purchases by Fannie Mae and Freddie Mac to ease a credit crunch in the mortgage market. Jackson said today that he talked with Fannie Mae Chief Executive Officer Daniel Mudd and may reply tomorrow to his request that the government-chartered company be allowed to buy home loans beyond its $722.5 billion federal limit. Fannie Mae and Freddie Mac would help replace buyers who fled mortgage assets after defaults on subprime loans rose to the highest in 10 years."

MBA - "Mortgage Applications Increase in Latest MBA Weekly Survey" (8-8-07)

"The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending August 3, 2007. The Market Composite Index, a measure of mortgage loan application volume, was 656.5, an increase of 8.1 percent on a seasonally adjusted basis from 607.1 one week earlier. On an unadjusted basis, the Index increased 7.7 percent compared with the previous week and was up 18.0 percent compared with the same week one year earlier. The Refinance Index increased 9.1 percent to 1881.1 from 1724.1 the previous week and the seasonally adjusted Purchase Index increased 7.4 percent to 447.4 from 416.6 one week earlier. On an unadjusted basis, the Purchase Index increased 6.8 percent to 486.9 from 455.7 the previous week. The seasonally adjusted Conventional Index increased 8.0 percent to 958.5 from 887.2 the previous week, and the seasonally adjusted Government Index increased 9.3 percent to 152.9 from 139.9 the previous week."

NAR - "Near-Term Home Sales to Hold in Modest Range" (8-7-07)

"The housing market will probably hold close to present levels in the months ahead, according to the latest forecast by the National Association of Realtors®. Lawrence Yun, NAR senior economist, said he isn’t looking for any notable changes in sales activity. 'Existing-home sales should be relatively stable over the next few months, holding in a modest range, with some pent-up demand growing from buyers who’ve been on the sidelines,' he said. 'Mortgage disruptions will hold back sales over the short term, but long-term fundamentals are favorable. A modest upturn is projected for existing-home sales toward the end of the year, with broader improvement to include the new-home market by the middle of 2008.'"

Bloomberg - "U.S. Stocks Rise for a Third Day, Led by Banks; Merrill Gains" (8-8-07)

"U.S. stocks rose for a third day on diminishing concern that subprime mortgage losses will hurt earnings at homebuilders and financial companies and after Cisco Systems Inc. increased its sales forecast. Merrill Lynch & Co. and Morgan Stanley led financial companies to the top gain in the Standard & Poor's 500 Index after a Citigroup Inc. analyst recommended buying the shares. Pulte Homes Inc. and D.R. Horton Inc. helped push a gauge of construction companies to its biggest advance since November. Cisco Systems Inc., the world's largest maker of computer- networking gear, climbed to a six-year high after saying demand for Internet gear increased."

Bloomberg - "`Mortgage Disruptions' Will Deepen U.S. Housing Slump" (8-8-07)

"U.S. home sales will tumble to a five-year low this year as a widening credit crunch reduces the number of buyers who can get mortgages, the National Association of Realtors said today. Sales of previously owned homes probably will fall 6.8 percent to 6.04 million in 2007, the lowest since 5.63 million in 2002, the real estate trade group said today in its monthly forecast, lowering its outlook for the eighth time this year. New-home sales, which account for about 15 percent of the housing market, probably will fall 19 percent to 852,000, a 10- year low, the group said."

Bloomberg - "U.K.'s Subprime Crisis May Be Worse Than U.S.'s: Matthew Lynn" (8-8-07)

"We are now all familiar with the damage that can be done to financial markets by a subprime lending crisis. Global equity markets have taken a battering recently because of concerns about U.S. home mortgages. So which country is next? The U.K. has had a property bubble every bit as crazy as the U.S.'s. Valuations were stretched, and lending criteria loosened. And now arrears are starting to rocket, even while the economy remains healthy."

The Washington Post - "Fannie, Freddie Aim to Ease Mortgage-Market Crunch" (8-8-07)

"For Fannie Mae and Freddie Mac, the chronically embattled companies chartered by the government to make homeownership more attainable, the recent upheaval in the mortgage market presents financial and political opportunities. After accounting scandals and allegations that Fannie Mae in particular was run largely for the enrichment of its executives, even some longtime allies in Congress have demanded the companies to do more for the public good."

Real Estate Journal - "How Credit Got So Easy And Why It's Tightening" (8-8-07)

"An extraordinary credit boom that created many first-time homeowners and financed a wave of corporate takeovers seems to be waning. Home buyers with poor credit are having trouble borrowing. Institutional investors from Milwaukee to Düsseldorf to Sydney are reporting losses. Banks are stuck with corporate debt that investors won't buy. Stocks are on a roller coaster, with financial powerhouses like Bear Stearns Cos. and Blackstone Group coming under intense pressure."