DQNews - "California January 2008 Home Sales" (2-18-08)

"A total of 19,145 new and resale houses and condos were sold statewide last month. That's the lowest number for any month in DataQuick's records, which go back to 1988. It was 25.2 percent lower than December's 25,585 and 41.0 percent lower than 32,425 for January last year."

Bloomberg - "Platinum Rallies Above $2,100 for First Time; Gold Also Climbs" (2-18-08)

"Platinum surpassed $2,100 an ounce for the first time after money managers increased investments to a record as a power crisis and accidents at mines and smelters curb output in South Africa, the largest producing nation.Investment in platinum-backed shares created by ETF Securities Ltd. rose to an all-time high of 288,680 ounces by Feb. 14, according to its Web site. Anglo Platinum Ltd., the world's biggest producer of the metal, on Feb. 15 said damage to a smelter in South Africa will take four to six weeks to repair. The country provides about 80 percent of global supply."

Bloomberg - "Bond Insurer Split May Trigger Lawsuits, Analysts Say" (2-18-08)

"New York Insurance Department Superintendent Eric Dinallo and New York Governor Eliot Spitzer said last week that insurers may need to be divided if they can't raise enough capital to compensate for losses on subprime-mortgage guarantees. FGIC Corp., the fourth-largest of the so-called monoline insurers, asked to be split on Feb. 15 after Moody's Investors Service cut the Stamford, Connecticut-based company's top Aaa ranking."

Bloomberg - "Bernanke's Rate Cuts Force Asia Back to Price Limits, Subsidies" (2-18-08)

"Ben S. Bernanke, the champion of free markets, is driving Asia's governments back to controlled economies. Under Bernanke's chairmanship, the Federal Reserve's steepest interest-rate cuts since 1990 are limiting his Asian counterparts' options to curb inflation. Instead of raising their own borrowing costs or letting their currencies appreciate faster, governments are resorting to regulating meat and egg prices in China, stockpiling cooking oil in Malaysia and subsidizing utility bills in Indonesia and the Philippines."

CNN - "Countrywide expands scope of mortgage help" (2-18-08)

"Countrywide Financial says it will expand programs to help borrowers manage their mortgage payments regardless of the type of subprime loan they have or whether they have already fallen behind on payments. Full details of the initiative, the result of a pact with a national community advocacy group, were to be disclosed Monday. Initial plans to disclose the deal were postponed last month after Countrywide agreed to be acquired by Bank of America (BAC, Fortune 500) for $4.1 billion in stock."

CNN - "Jumbo mortgages: The best deals" (2-18-08)

"For many house hunters, these are good times. Home prices have fallen 10% or more in once-hot markets, and interest rates on mortgages of $417,000 or less have sunk to their lowest levels in four years. Today a family with solid credit and enough cash for a 20% down payment can lock in a rate of only 5.9% on a 30-year mortgage, according to Bankrate. Thank you, Ben Bernanke!"

Yahoo - "Northern Rock shares suspended on nationalisation plan" (2-18-08)

"Shares in troubled British bank Northern Rock were suspended on Monday as the group, devastated by the global credit crunch, said it would be taken into public ownership in the coming days. Northern Rock's share price has never recovered since it was forced to request emergency funding from the Bank of England in September when thousands of account holders flocked to take their money out of the mortgage lender."

Herald Tribune - "Popularity of bonds turning some investors away" (2-18-08)

"Last year, U.S. Treasuries benefited tremendously from the flight from risk as the credit crisis began. But the sector's popularity took off when the Federal Reserve started cutting interest rates aggressively last September to support the economy. It has reduced its target for the federal funds rate by 2.25 percentage points, to 3 percent."

The Washington Times - "401(k) debit draws red flags" (2-18-08)

"A new debit card that lets consumers use ATMs to withdraw money from their 401(k) plans is drawing a sharp reaction from financial planners. The ReservePlus card is marketed by Reserve Solutions Inc., a New York financial firm that says it has 10,000 cardholders already."

The Press Democrat - "A boom in bankruptcies" (2-17-08)

"A total of 47 cases were scheduled for hearings Thursday in his Santa Rosa bankruptcy court, each involving a creditor seeking permission to seize a debtor's property. While a few cases dealt with debts on cars or commercial properties, the vast majority involved lenders attempting to foreclose on homeowners who had sought safe haven in the courts from the fallout of the subprime mortgage crisis."

The San Diego Union Tribune - "Student borrowers latest to feel credit crunch" (2-17-08)

"If you want to borrow a lot of money for college, you are not going to like what the mortgage mess is doing to you. The credit crunch, which started with a panic over people missing home loan payments several months ago, has spread like a disease, infecting a broad range of loans. Now it may poison opportunities for college students to obtain some loans and is adding painfully high interest costs to many."

Los Angeles Times - "Shades of gray amid a bleak view of housing prices" (2-17-08)

"The average price of houses sold in the country's 32 largest metropolitan areas during 2007 declined by 3.7%, according to the first official government figures covering the previous year. The $11,900 slide, from $324,900 at the end of 2006 to $313,000 on Dec. 31, is somewhat larger than the December-to-December drop-off recorded by the National Assn. of Realtors, which reported a more modest 1.4% slip in the median house price."

Orange County Register - "How I'd fix the mortgage mess" (2-17-08)

"No more loan fees. None. Yes, zero transaction costs. Why? Then we can all shop for mortgages on a level playing field, like, 6 percent vs. 5.75 percent. Instead of 6 percent at a quarter-point vs. 5.75 at a point with no escrow fees, or the like. Let the lenders (especially the new ones I'd let in) and the loan-support business figure out how to profit in such an environment. Yes, mortgage rates may tick up a bit, but at least people will know what rate they are actually getting and how much they are paying for the service."

Orange County Register - "Builders offer buyers price guarantees" (2-17-08)

"Faced with plummeting home sales and reluctant buyers, some homebuilders are offering a plan designed to take the worry out of buying when prices are falling. So far, none of these plans is available in Orange County, although Los Angeles-based KB Homeswill begin offering oneat an O.C. project later this month. Other builders also have offered price guarantees in the Inland Empire."

The San Diego Union Tribune - "Q&A: How could things go so bad and so quickly?" (2-16-08)

"Just three years ago, the housing boom seemed like such a good thing. Property values were skyrocketing. Home equity loans were helping homeowners live in luxury. Mortgage rates were low enough to attract low-income buyers who never thought they'd be able to afford a home."

The San Diego Union Tribune - "Home loans failing at record rates; foreclosures up 257% over Jan. '07" (2-16-08)

"Home loan failures in San Diego County continued their steady climb in January, setting records for both foreclosures and the notices of default that are the first step in reclaiming mortgaged properties. The number of foreclosures in the county was 1,305, up 32 percent from December and up nearly 257 percent from January 2007. Notices of default totaled 3,109, up 21 percent from December and up 145 percent from the previous year."

The San Diego Union Tribune - "Splitting of bond insurers studied" (2-16-08)

"Regulators and bankers racing to bolster troubled bond insurance companies are considering splitting the firms into two parts – one for safe municipal debt and the other for riskier mortgage-related securities."

The San Diego Union Tribune - "Governor to sign $1 billion in cuts" (2-16-08)

"The Legislature sent Gov. Arnold Schwarzenegger a $1 billion package of midyear budget cuts yesterday – in addition to a 10 percent cut for Medi-Cal providers for next fiscal year that some said will be devastating."

Los Angeles Times - "Confessions of a mortgage salesman" (2-16-08)

"Top 10 Mistakes Mortgage Borrowers Make"

CBIA - "California New Home Market Ends 2007 in Doldrums, CBIA Announces" (2-15-08)

"The monthly CBIA/Hanley Wood Market Intelligence (HWMI) New Home Sales and Pricing Report showed that net new home sales during 2007 in the subdivisions tracked by Costa Mesa-based HWMI totaled 61,861 homes and condominiums, compared to 89,773 in 2006, a decline of 31.1 percent. Sales of single family homes dropped by 29.7 percent, while sales of townhomes and “plexes” – duplexes, triplexes, etc. – were down 21.6 percent and sales of condominiums were down 38.6 percent. The figures for December were even more dour, with year-over-year declines just shy of 67 percent."

Bloomberg - "Gold Gains on Outlook for Lower Rates; Platinum Rises to Record" (2-15-08)

"Gold advanced in London on prospects interest-rate cuts in the U.S. will spur demand for the metal as an alternative to the dollar. Platinum rose to a record. The U.S. currency erased gains for the year yesterday after Federal Reserve Chairman Ben S. Bernanke signaled the bank may reduce interest rates further. Assets in the StreetTracks Gold Trust, the biggest fund backed by gold, have dropped 3.4 percent from a record on Jan. 14, partly on speculation the dollar would rebound this year from earlier declines."

Reuters - "Struggling Citigroup hedge fund bars withdrawals -WSJ" (2-15-08)

"Citigroup Inc has barred investors in its CSO Partners hedge fund from withdrawing their money, according to a Wall Street Journal report on Friday. Citigroup suspended redemptions in CSO, a fund specialising in corporate debt, after investors tried to withdraw more than 30 percent of the fund's $500 million in assets, said the story."

Bloomberg - "Greenspan Says U.S. Economy Is on Edge of a Recession" (2-15-08)

"Former Federal Reserve Chairman Alan Greenspan said the U.S. economy is on the verge of its first recession in six years as falling home values hurt consumer spending. Greenspan's view has evolved from a year ago, when he saw a one-in-three chance of a recession, citing slowing profit growth and becoming one of the first economists to warn of the risk. Now, Wall Street firms including Merrill Lynch & Co. and Goldman Sachs Group Inc. are forecasting a contraction in the aftermath of the worst housing downturn in a quarter century."

The San Diego Union Tribune - "Rates on 30-year mortgages hit 5-week high" (2-15-08)

"Rates on 30-year mortgages rose to the highest level in five weeks but still remained below the 6 percent level. Freddie Mac said in its nationwide survey that 30-year fixed-rate mortgages rose to 5.72 percent this week from 5.67 percent last week.Other mortgage rates were mixed, with only slight movements in any category. Rates on 15-year mortgages rose to 5.25 percent from 5.15 percent. Rates on five-year adjustable-rate mortgages dipped to 5.19 percent from 5.21 percent. Rates on one-year ARMs were unchanged at 5.03 percent."

Bloomberg - "FGIC Seeks Split to Salvage Municipal Debt Ratings" (2-15-08)

"FGIC Corp., the bond insurer stripped of its Aaa ranking by Moody's Investors Service yesterday, asked to be split in two to protect the ratings on municipal bonds it guarantees. FGIC, owned by Blackstone Group LP and PMI Group Inc., applied for a license from New York state insurance regulators to create a standalone municipal company, Brian Moore, a spokesman, said. The move would separate the unit that guarantees subprime- mortgage bonds, collateralized debt obligations and the other types of financial products that led to the ratings downgrades."

Bloomberg - "Banks at Risk of $203 Billion in Writedowns, Says UBS" (2-15-08)

"The world's biggest banks may have to book as much as $203 billion of writedowns, in addition to the $152 billion reported so far, if bond insurers the lenders rely on become insolvent, UBS AG said. MBIA Inc. and Ambac Financial Group Inc., the No. 1 and No. 2 bond insurers, are struggling to maintain their AAA credit ratings following losses on residential mortgages. Banks may be forced to write down the value of securities protected by contracts with the so-called monoline insurers if their financial condition deteriorates, Finch said. The New York-based companies guarantee the repayment of bond principal and interest in the event of defaults."

Bloomberg - "Countrywide's Overdue Mortgages Increase to 7.47%" (2-15-08)

"Countrywide Financial Corp., the biggest U.S. mortgage lender, said late loans were at their highest level in at least six years during January, adding to evidence that the U.S. housing slump is getting deeper. Overdue loans rose to 7.47 percent of unpaid principal balances from 7.2 percent in December and 4.32 percent in January 2007, according to a Countrywide statement today. Foreclosures advanced to 1.48 percent in January, also a six- year high, from 1.44 percent in December and 0.77 percent a year earlier."

Bloomberg - "Investment-Grade Defaults to Rise, Credit Models Show" (2-15-08)

"The seizure in the credit markets caused by the collapse of subprime mortgages is making investors doubt even the AAA rated securities of companies with investment-grade credentials. The Markit CDX North America Investment-Grade Index of 125 U.S. companies from AT&T Inc. to Walt Disney Co. signals the greatest risk of its members defaulting at the same time since the measure started trading in 2003, according to Royal Bank of Scotland Group Plc. The so-called default correlation model rose to 42 percent on the part of the index that's most exposed to losses, according to data compiled by Bloomberg and Milan-based UniCredit SpA. In May, the model was at 15 percent."

NAR - "Metro Areas Show Greatly Mixed Home Price Performance; Half Show Gains" (2-14-08)

"Roughly half of metropolitan areas continued to show rising home prices in the fourth quarter of 2007, according to the latest quarterly survey by the National Association of Realtors®. In the fourth quarter, 73 out of 150 metropolitan statistical areas(1) show increases in median existing single-family home prices from a year earlier, including 11 areas with double-digit annual gains and another 12 metros showing increases of 6 percent or more; 77 had price declines including 16 with double-digit drops."

DQNews - "Bay Area home sales lowest for any month in two decades" (2-14-08)

"Bay Area home sales plunged below 4,000 transactions for the first time in over 20 years last month as the market remained hamstrung by the credit crunch and uncertainty among buyers, sellers and lenders. Price declines steepened, especially in inland markets hit hard by foreclosures, a real estate information service reported. A total of 3,586 new and resale houses and condos sold in the Bay Area in January. That was down 29.2 percent from 5,065 in December, and down 41.9 percent from 6,168 in January 2007, DataQuick Information Systems reported."

Bloomberg - "GMAC May Face `Substantial Difficulty,' Cerberus Says" (2-14-08)

"GMAC LLC, the auto and mortgage lender controlled by Cerberus Capital Management LP, may run into 'substantial difficulty' if credit markets don't improve, said Stephen Feinberg, founder of the private-equity firm. GMAC, the former financing arm of General Motors Corp., lost $2.3 billion last year as record U.S. home foreclosures led to an increase in bad loans and auto-lending profit declined, the Detroit-based company said Feb. 7. GMAC is in talks with potential buyers about parts of its Residential Capital mortgage unit, which posted a $4.3 billion loss."

Bloomberg - "Bernanke Pledges `Adequate Insurance' Against Risks" (2-14-08)

"Federal Reserve Chairman Ben S. Bernanke indicated that policy makers are prepared to lower interest rates further as the economy continues to deteriorate. The Fed 'will act in a timely manner as needed to support growth and to provide adequate insurance against downside risks,' Bernanke told the Senate Banking Committee in Washington today. 'A significant worsening in financial conditions or in credit availability would certainly be a warning bell that we need to take further action.'"

Bloomberg - "Americans Selling Homes See Prices Go Below Mortgage" (2-14-08)

"By the end of this year as many as 15 million U.S. households may owe more on their mortgages than their homes are worth, according to an estimate from Jan Hatzius, chief U.S. economist of New York-based Goldman Sachs Group Inc. That may fuel an increase in foreclosures, erode prices, and increase mortgage bond losses, he said in a Feb. 1 report."

Bloomberg - "UBS Won't Support Failing Auction-Rate Securities" (2-14-08)

"UBS AG won't buy auction-rate securities that fail to attract enough bidders, joining a growing number of dealers stepping back from the $300 billion market, said a person with direct knowledge of the situation. The second-biggest underwriter of the securities, whose rates are reset periodically at auctions, notified its 8,200 U.S. brokers of the decision yesterday, said the person, who declined to be identified because the announcement wasn't publicly disclosed. Goldman Sachs Group Inc., Lehman Brothers Holdings Inc. and Citigroup Inc. allowed auctions to fail as mounting losses from the collapse of subprime mortgages causes capital markets to seize up."

Yahoo - "Banks to ask government to take bad loan risk: report" (2-14-08)

"The banking industry is proposing to members of the U.S. Congress and the White House that some of the risk of troubled mortgages should be shifted to the federal government, according to a report in the Wall Street Journal on Thursday."

The Washington Post - "Predatory Lenders' Partner in Crime" (2-14-08)

"Several years ago, state attorneys general and others involved in consumer protection began to notice a marked increase in a range of predatory lending practices by mortgage lenders. Some were misrepresenting the terms of loans, making loans without regard to consumers' ability to repay, making loans with deceptive 'teaser' rates that later ballooned astronomically, packing loans with undisclosed charges and fees, or even paying illegal kickbacks. These and other practices, we noticed, were having a devastating effect on home buyers. In addition, the widespread nature of these practices, if left unchecked, threatened our financial markets."

Freddie Mac - "FREDDIE MAC CHANGES MORTGAGE INSURER ELIGIBILITY RULES TO CAP PREMIUM CEDES ON CAPTIVE REINSURANCE" (2-14-08)

"Freddie Mac (NYSE: FRE) today announced it is temporarily changing its Private Mortgage Insurer Eligibility Requirements [PDF 160K] in order to increase the claims-paying and capital retention capacities of its mortgage insurance counterparties during the current market correction. Effective on or after June 1, 2008, Freddie Mac-approved private mortgage insurers may not cede new risk if the gross risk or gross premium ceded to captive reinsurers is greater than 25 percent. Beyond limiting the allowable cede to 25 percent, the temporary policy does not limit the mortgage industry's use of captive reinsurance."

Financial Times - "Subprime litigation" (2-14-08)

"Where are all the lawsuits? Banks and pension funds have lost hundreds of billions of dollars in the subprime blow-up, yet surprisingly few institutional investors have made their way to the courthouse. The identity of the one exception and its legal team helps explain why. Barclays is suing Bear Stearns over hedge fund losses and the UK-based bank has convinced Linklaters’ New York office to represent it. The giant law firm had occasionally done work for Bear, but Barclays is one of Linklaters’ most important clients."

Bloomberg - "Paulson Foreshadows Proposals to Tighten Loan Rules" (2-14-08)

"Treasury Secretary Henry Paulson said U.S. regulators plan to alter rules for packaging loans into bonds in the aftermath of the subprime-credit collapse. Paulson and Federal Reserve Chairman Ben S. Bernanke, who testify before Congress today, first want markets to stabilize, reducing borrowing costs for companies and consumers. Policy makers are trying to revive an economy that expanded at the slowest pace since 2002 last year."

Orange County Register - "Calif. home price off 18.7%, nation’s worst" (2-14-08)

"First American CoreLogic says California home prices were falling at an 18.7% annual rate through late January, the nation’s largest decline. California has held that dubious distinction of FACL’s worst performing state since May."

NAR - "NAR Pushes for Homeownership Protection for Older Americans" (2-13-08)

"The National Association of Realtors® testified today that foreclosure rescue scams have caused major problems for many Americans and that older Americans and other vulnerable borrowers are frequently targets. NAR called for increased funding for programs that provide financial assistance, counseling and consumer education to borrowers to help them avoid foreclosures and foreclosure rescue scams."

NAR - "NAR Challenges HUD and Regulators to Quickly Implement Loan Limit Increases" (2-13-08)

"In a letter to HUD Secretary Alphonso Jackson and OFHEO Director James Lockhart, NAR notes that failing to move quickly to allow Fannie Mae, Freddie Mac and the FHA to increase their loan limits will prolong the nation’s mortgage crisis and make a recovery in the housing market more difficult."

CBIA - "CBIA President & CEO Hails Federal Action to Increase Conforming Loan Limits" (2-13-08)

"Today, California Building Industry Association (CBIA) President & CEO Robert Rivinius hailed the enactment of HR 5140, which increases limits for loans purchased by Fannie Mae and Freddie Mac from $417,000 to as high as $729,750 in high-cost areas between now and December 31, 2008. The Association has been calling for these reforms for several years because California's median home price exceeded the limit, preventing hard-working Californians from access to government-backed loans, which are more stable and offer more favorable interest rates. California’s median home price as of December, 2007 was $475,460, according to the California Association of REALTORS®."

DQNews - "Southland home sales slowest for any month in 20 years" (2-13-08)

"A total of 9,983 new and resale houses and condos were sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties in January. That was down 24.6 percent from 13,240 for the previous month, and down 44.9 percent from 18,128 for January last year, according to DataQuick Information Systems."

Mortgage Bankers Association - "Mortgage Applications Decrease In Latest MBA Weekly Survey" (2-13-08)

"The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending February 8, 2008. The Market Composite Index, a measure of mortgage loan application volume, was 1063.5, a decrease of 2.1 percent on a seasonally adjusted basis from 1086.6 one week earlier. On an unadjusted basis, the Index decreased 0.4 percent compared with the previous week and was up 65 percent compared with the same week one year earlier."

The News Press - "Mortgagees rip ‘Band-Aid’" (2-13-08)

"Under the new program, six of the nation's largest financial institutions said they will begin contacting homeowners who are 90 or more days overdue on their monthly mortgage payments. The homeowners will be given the opportunity to put the foreclosure process on pause for 30 days while the lenders look for a way to make the mortgage more affordable. But people in Lee County - where the number of foreclosures jumped to a record 1,833 in January as prices have plunged over the past two years - had little good to say about the proposal."

Business Week - "The Housing Bust Shakes Up Rentals" (2-13-08)

"For many Americans, as property values sink and mortgage interest payments rise, the dream of homeownership has turned into a nightmare. In the past, however, one group of people who have tended to ride out real estate downturns are landlords, who can raise rents while potential buyers sit on the sidelines waiting for conditions to settle. But not this year. Rent growth in 2007 actually went flat in some metro areas hardest hit by the housing meltdown."

Bloomberg - "Auction-Bond Failures Roil Munis, Pushing Rates Up" (2-13-08)

"Bonds sold by U.S. municipal borrowers with rates set through periodic auctions failed to attract enough buyers as banks including Goldman Sachs Group Inc. and Citigroup Inc. that run the bidding won't commit their own capital to the debt."

Yahoo - "MGIC Swings to $1.5B Loss in 4Q" (2-13-08)

"Mortgage insurer MGIC Investment Corp. said it's looking for ways to boost capital after announcing it lost almost $1.5 billion in the fourth quarter as more homeowners struggled to make payments. The nation's largest mortgage insurer still doesn't see making money this year, if delinquencies and losses continue to rise and fewer homeowners get back on track with payments, chairman and chief executive Curt S. Culver said."

Market Watch - "Wait till 2009" (2-13-08)

"The housing market will not stabilize until late in 2008 at best, with sales, starts and prices continuing their slide through most of the year, economists attending the International Builders Show here said Wednesday."

Orange County Register - "Former drug ranch resurfaces as luxury retreat" (2-13-08)

"Real estate agents say the ranch is the biggest residential parcel on the Orange County market right now. It could also be one of the last big chunks of raw land available in Orange County."

Orange County Register - "Orange County home prices and sales, January 2008" (2-13-08)

"For the month of January, sales for all types of Orange County home sales decreased 46.4 percent. The median sales price decreased 13.3 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 - "Buying Foreclosed HomesWithout Going the Auction Route" (2-13-08)

"You might think that it's an especially good time to get a deal on a foreclosed home at an auction. It isn't. Despite the growing number of foreclosures across the country, there are few bargains to be found at auctions. For one thing, you'll be competing against savvy local investors who know how to gauge a property's real value. What's more, many properties are mortgaged so steeply that banks often ask for bids that are higher than the properties are worth."

Bloomberg - "Fannie Mae Escrow Grab Exposes Shareholders to 24% Loss in Suit" (2-13-08)

"Fannie Mae, the largest source of U.S. home-loan money, faces a proposed class-action lawsuit over as much as $7 billion it earned on property owners' escrow accounts starting in the 1970s. The company violated government policy and breached its duty to about 4,000 owners of government insured moderate- and low-income housing, lawyer Mark Lanier claims in federal court in Texarkana, Texas. Fannie Mae should return gains of $3 billion to $7 billion, said Lanier, 47, with the Houston-based Lanier Law Firm. The higher figure is $7.20 a share, 24 percent of the company's market value. Fannie Mae says it acted legally."

The Wall Street Journal - "Buffett Offers To Be Reinsurer On Muni Bonds" (2-13-08)

"Warren Buffett's plan to reinsure hundreds of billions of dollars of municipal bonds already guaranteed by struggling bond insurers helped lift the stock market -- but the offer isn't likely to improve the insurers' credit ratings or their future prospects."

Bloomberg - "Paulson, U.S. Banks Forge Foreclosure-Freeze Deal" (2-12-08)

"Treasury Secretary Henry Paulson and banks representing half the U.S. mortgage market agreed to offer 30-day freezes on foreclosures, acknowledging the need for a stronger response to the worst housing slump in a generation. JPMorgan Chase & Co., Citigroup Inc. and four other banks set up a plan to encourage homeowners at risk of default to contact lenders about modifying their loans. Paulson said that he's open to additional measures, while rejecting a Democratic proposal for the government to buy distressed mortgages."

Financial Times - "Three wiser men" (2-12-08)

"None of the institutions at the heart of the crisis - the Federal Reserve, the European Central Bank and the Bank of England - has found the past half year comfortable. The period has been the equivalent of a test-tube experiment in modern central banking, and policymakers now resemble a distinctly uneasy group of scientists: they know what policies they have put into the pot in recent months, but are far from clear why the markets have reacted in certain ways - and even less sure that they have devised the perfect cocktail to stop markets erupting again."

Bloomberg - "IndyMac Posts Record Loss, Calls Reserves Adequate" (2-12-08)

"IndyMac Bancorp Inc., the second- biggest independent U.S. mortgage company, posted a record fourth-quarter loss. The shares rose after it said reserves are adequate even if defaults continue building at the recent pace. The net loss was $509.1 million, or $6.43 a share, compared with a profit of $72.2 million, or 97 cents, in the same period a year earlier. The company's $2.4 billion in reserves will protect it should late payments and default rates continue at the fourth quarter's 'horrible' rate, Chief Executive Officer Michael Perry said on a conference call with analysts."

CNN - "Buffett offers to help ailing bond insurers" (2-12-08)

"Billionaire investor Warren Buffett said Tuesday he is offering to take over the liabilities of the troubled bond insurers, whose shaky finances have regulators and Wall Street greatly alarmed.
The billionaire's Berkshire Hathaway (BRKA, Fortune 500) approached the three largest bond insurers last week - Ambac (ABK), MBIA (MBI), and FGIC Corp. - offering to reinsure about $800 billion in tax-exempt or municipal bonds in order to maintain their 'AAA' rating, Buffett told CNBC in a televised interview."

The Washington Post - "White House Sees Slow Growth in '08, But Not a Recession" (2-12-08)

"The economy may grow slowly the first half of this year, the Bush administration said yesterday, but it is not in recession. The economic stimulus bill that President Bush plans to sign this week, combined with interest rate cuts by the Federal Reserve, will result in stronger growth in the second half of the year, according to the annual Economic Report of the President."

Bloomberg - "GMH to Be Bought by American Campus, Balfour Beatty" (2-12-08)

"GMH Communities Trust, the U.S. provider of housing to students and the military, agreed to be bought in two transactions for a total of $787 million. GMH, based in Newtown Square, Pennsylvania, will sell its military housing unit to Balfour Beatty Plc, the U.K.'s largest house builder, for $350 million in cash, according to a statement today. The rest of GMH will then be acquired by American Campus Communities Inc. for $437 million in cash and stock. American Campus will also assume $963 million in debt. GMH gained as much as 59 percent in New York trading."

Los Angeles Times - "Behind the new foreclosure freeze: The fear factor" (2-12-08)

"Banks and lenders are afraid -- afraid of a deepening housing crisis, afraid of the political blowback, afraid of writing down more bad loans, and very, very afraid of being stuck owning foreclosed houses that are declining in value every day. The knife is still falling; banks and lenders do not want to catch it. But don't take my word for it. I get my best stuff from the comment section"

Orange County Register - "Ladera homes are O.C.’s most searched" (2-12-08)

"Home tracker Zillow has its critics, but it also offers an usual bit of data: What neighborhoods are most closely checked, on a relative basis to their home counts, at this online valuation service. Here’s a look at the fourth-quarter popularity contest"

Real Estate Journal - "Why Your Nest Is NotYour Nest Egg" (2-12-08)

"A house isn't a stock. To be sure, you probably don't regularly confuse the bricks and mortar you occupy with the investments listed on your brokerage statement. Yet thinking about the differences between the two helps explain why folks love owning real estate -- but also why some homeowners are in such trouble today. Here are five key ways that homes differ from stocks and stock mutual funds."

Yahoo - "Countrywide to Aid More Borrowers" (2-11-08)

"Countrywide Financial Corp., under pressure to help stem growing home loan defaults, says it will expand programs to help borrowers manage their mortgage payments regardless of the type of subprime loan they have or whether they have already fallen behind on payments.Full details of the initiative, the result of a pact with the national community advocacy group, were to be disclosed Monday. Initial plans to disclose the deal were postponed last month after Calabasas-based Countrywide agreed to be acquired by Bank of America Corp. for $4.1 billion in stock."

Bloomberg - "Economy Rebounds Before Election, Treasuries Show" (2-11-08)

"Before you can say 'Barack Obama is president of the United States,' the economy will be growing faster again. That forecast is based on the rise in the five-year Treasury yield from its lowest level relative to two- and 10- year notes since 2001. The last two times that happened was during the recessions of 1990 and 2001, and the economy began to expand within nine months."

Bloomberg - "Bond Insurance Turns Toxic for Munis as Rates Soar" (2-11-08)

"Bond insurance sold by MBIA Inc., Ambac Financial Group Inc. and Security Capital Assurance Ltd. is backfiring on counties, universities and hospitals across the U.S., more than doubling some borrowing costs. Park Nicollet Health Services in Minneapolis may pay an extra $5 million to $6 million this year, about a quarter of its operating profit, because interest on $375 million in floating- rate debt doubled in the last six weeks, said Chief Financial Officer David Cooke. The rate on $98 million insured by Ambac climbed to 6 percent on Jan. 30 from 3.06 percent on Jan. 2."

The San Diego Union Tribune - "So much for a break in credit card rates after the Fed's cuts" (2-11-08)

"The Federal Reserve's dramatic rate cuts were expected to make it cheaper for consumers to use credit cards. But credit card interest rates remain high and in many cases have even climbed. Bruised by a rise in foreclosures, banks have been reluctant to lower rates for cardholders who have missed payments or had their credit scores slip, analysts and industry watchdogs said. Yet even some cardholders who pay on time have not benefited from the Federal Reserve's recent actions, as banks raise rates and fees to make up for losses in their mortgage departments, analysts said."

Bloomberg - "CDO Losses Driving Credit-Default Swaps to Record, Analysts Say" (2-11-08)

"Banks are driving the cost of protecting corporate bonds from default to the highest on record as they seek to hedge against losses on collateralized debt obligations, according to traders of credit-default swaps. Contracts on the benchmark Markit iTraxx Crossover Index soared 17 basis points to 547 at 12:50 p.m. in London, according to JPMorgan Chase & Co. The Markit iTraxx Asia Ex-Japan Series 8 Index soared the most in one day, rising 15 basis points to an all-time high of 144.5, according to BNP Paribas SA. The Markit CDX North America Investment Grade Index rose 2.5 basis points to 132.25, Deutsche Bank AG prices show."

Bloomberg - "AIG Discloses `Weakness' in Derivative Accounting" (2-11-08)

"American International Group Inc., the world's largest insurer by assets, said auditors found a 'material weakness' in how the company values its credit- default swap portfolio. The stock fell the most in 20 years. The contracts declined by about $4.88 billion in October and November, according to data in a regulatory filing today. The drop was confirmed by company spokesman Chris Winans. AIG had said in December that the value of the 'super senior credit derivatives' fell by about $1.1 billion in those two months. The stock retreated 11 percent to $45.16 as of 10:19 a.m. in New York Stock Exchange composite trading."

Voice of San Diego - "Mortgage Distress Spreads Beyond Subprime" (2-11-08)

"In the year since national spotlights became trained on problems affiliated with subprime mortgages, some pundits and analysts have made "subprime" synonymous with the entire crisis in the economy, the housing market and a lot of other, sometimes unrelated, issues. But growth in late payments and foreclosures among other loans in San Diego County speaks to a problem that is far from contained to subprime, analysts caution."

Los Angeles Times - "Oops, we lost another $4.36 billion" (2-11-08)

"American International Group, the world's largest insurer, disclosed that the value of some of its risky debt portfolio had plunged by $5.96 billion, not $1.6 billion as reported earlier. The disclosure cast doubt on AIG's past contention that it didn't face major problems stemming from the credit crisis that has slammed other financial institutions."

Orange County Register - "Calif. ranks 32nd for outbound van moves" (2-11-08)

"Allied Van Lines’ moving data for 2007 shows that 52% of its California moves were outbound. My trusty spreadsheet tells me that ranks California 32nd among 48 states (no Hawaii or Iowa) in terms of a state’s relative “draw” for new residents. Michigan (67% outbound) was worst; Arkansas (38%) was best."

Orange County Register - "O.C. home supply at 7-month low" (2-11-08)

"it would take 9.73 months for buyers to gobble up all homes listed for sale last Thursday at the current pace of deals vs. 12.51 months two weeks earlier and vs. 4.87 months a year ago."

Real Estate Journal - "Commentary: The RiseOf the Mortgage Walkers" (2-11-08)

"'The apparent willingness of borrowers to walk away from mortgage debt,' the analysts noted, 'has contributed to extraordinary high levels of early default' on loans issued during the 18 months before the mortgage bubble burst. It expects losses to reach 21% of initial loan balances for subprime mortgages issued in 2006 and 26% for those issued in early 2007."

Los Angeles Times - "A baby-boomer bubble is forecast" (2-10-08)

"The common perception among economists is that the current housing mess will be a relatively short-term affair that should see a return to normalcy within the next few years.But, according to a new study by two USC researchers, problems of greater proportion lie just ahead. They call it the 'generational housing bubble' and maintain that it will be fueled by the same baby boomers who have been bidding up prices since 1970 as they moved up the housing ladder."

Orange County Register - "Construction slowdown hits contractors and workers alike" (2-10-08)

"First the slowdown hit residential builders. Then work alsoslowed in nearly every other sector as well, including commercial and industrial construction, according to figures from the non-profit Construction Industry Research Board, which tracks building permits in California. The estimated value of building permits for homebuilding fell 26 percent in Orange County last year, dropping to $1.8 billion from $2.4 billion in 2006."

Orange County Register - "Amount of O.C. construction, 1998-2007" (2-10-08)

"The estimated value of construction in Orange County declined last year in every category except non-residential alterations and additions. Here are numbers for the past decade"

San Francisco Chronicle - "Lenders pinch borrowing on lines of credit" (2-10-08)

"Tens of thousands of homeowners with home equity lines of credit are getting a rude surprise: They've been told by their lender that they no longer can take money out on their credit lines because sinking home prices have left them with little or no equity. Among the lenders taking such action is Countrywide Financial Corp., which sent letters to 122,000 customers last week telling them they no longer could borrow against their credit lines. In some cases, the company says, the borrowers are 'upside down' on their mortgages - the total debt on the home exceeds the property's market value."

The Observer - "Credit crisis 'here to stay,' say top bankers" (2-10-08)

"The world economy faces a 'turbulent time', the Chancellor, Alistair Darling, warned this weekend after meeting finance ministers from the world's main industrialised nations in Tokyo to discuss ways of tackling the credit crunch. Darling and his G7 counterparts were presented with a grim assessment of the damage wrought by reckless lending in the American housing market, which has snowballed into a global financial crisis over the past six months."

The Press Democrat - "How could so many people afford homes at peak of boom?" (2-10-08)

"When home prices peaked in 2005, the typical home buyer in Sonoma County claimed to earn $120,000 a year on loan documents, according to federal home loan data. But they actually earned about $80,700, according to Census data. The spread grew in 2006, when the typical buyer claimed to earn $132,000; their actual income was about $79,000. They were enabled by a mortgage industry that was so eager to hand out money - and rake in lucrative commissions - that it issued many loans without requiring borrowers to document earnings."

The California - "Time to buy? -- Debate on about whether market is ripe for buyers" (2-10-08)

"Buy now or wait? That is the question many potential homeowners face as the region continues to trudge through a housing depression that leaves them wondering how much further home prices will fall. Industry insiders and academic analysts agree that the answer depends on who is doing the asking. For families, most Realtors and real estate professors concur that those looking at a house as a home should start shopping now."

The San Diego Union Tribune - "Homeowners could catch a break" (2-9-08)

"Congress may be issuing $600-per-person tax rebate checks this spring, but the temporary mortgage revisions in the economic stimulus package passed this week could have a greater effect on San Diego's economy, particularly its beleaguered housing market. That's because the package, expected to be signed next week by President Bush, could save some homeowners hundreds of dollars a month in mortgage payments and rescue other owners wanting to refinance out of adjustable-rate mortgages."

EIR - "Foolish Fed's Rate CutPumps Hyperinflation" (2-9-08)

"Panic can be a dangerous thing, especially when it is the response by a central bank to global economic disintegration, and panic is just what the Federal Reserve did with its two interest-rate cuts in January. The combined 1.25 percentage-point cut was precisely the wrong move, amounting to more of the poison which has already killed the patient. The Fed is trying to save a system which cannot be saved, and in doing so, is leading the nation and the world into a Weimar Germany-style hyperinflationary blowout. We are headed, in the analysis of Lyndon LaRouche, into a "global breakdown crisis," a self-feeding downward spiral in which the financial system, the physical economy, and the political structures all collapse, leading to a chaos not seen since the Dark Age of 14th-Century Europe."

The Charlotte Observer - "Wachovia loans questioned" (2-9-08)

"At a time when many lenders are pulling back on nontraditional mortgages, Wachovia Corp. is diving in deeper. The Charlotte bank argues that its 'Pick-A-Payment' mortgage gives customers more flexibility to manage their personal finances. But the product, amid turbulent times in the housing market, has drawn concern from the bank's investors, consumer advocates and even some employees."

NAR - "NAR Hails Passage of Economic Stimulus Package to Help Jumpstart Housing Market" (2-8-08)

"The National Association of Realtors® congratulated the U.S. Congress for quickly passing a national economic stimulus package and thanked President George W. Bush for his leadership and willingness to promptly enact legislation that will help thousands of families, the housing market, and the U.S. economy."

CNN - "Refinancing: Only for the privileged few" (2-8-08)

"The good news: mortgage rates are down. The bad news: it's much harder to qualify for a refinanced loan these days. What's more, the borrowers who need to refinance the most - because their adjustable rate mortgages (ARMs) are resetting to higher interest rates - are among those having the most trouble winning approvals."

Bloomberg - "Treasuries Advance on Recession Concern, Climbing Default Risk" (2-8-08)

"Treasuries rose, pushing two-year notes to their eighth straight weekly gain, as economists said there is an even chance the U.S. will enter a recession and the risk of companies defaulting on their debt climbed to a record. Investors also bought longer-maturity debt after the Treasury's $9 billion sale of 30-year bonds yesterday led to the biggest jump in the securities' yield since 2004. Two-year note yields were the furthest below 10-year rates since 2004, indicating traders are favoring shorter-maturity debt in a bet the Federal Reserve will cut interest rates for a sixth time since September."

Bloomberg - "Bear Stearns Is `Short' Subprime Mortgages $1 Billion" (2-8-08)

"Bear Stearns Cos., the U.S. securities firm that posted its first-ever loss last quarter on mortgage writedowns, has more than $1 billion of trades that profit if subprime home loans and bonds continue to deteriorate. The 'short' positions on subprime mortgage securities increased from $600 million at the end of November, Chief Financial Officer Sam Molinaro said today at an investor conference in Naples, Florida. The company also reduced its holdings of so-called collateralized debt obligations and underlying bonds, Molinaro said."

Bloomberg - "Toll Cuts Chief Executive's Pay by More Than Half" (2-8-08)

"Robert Toll, the chief executive officer of homebuilder Toll Brothers Inc., had his compensation cut by more than half last fiscal year and received no bonus after the company's shares fell 21 percent. Robert Toll was paid $8.4 million in the year ended Oct. 31, according to a regulatory filing today. In 2006, he got $19.2 million, including a $17.5 million bonus."

Bloomberg - "`Jumbo' Loan Increase May Not Stem Housing Decline" (2-8-08)

"A congressional plan to let Fannie Mae and Freddie Mac insure larger mortgages may not be enough to reverse the U.S. housing market slide, said Nishu Sood, a homebuilding analyst with Deutsche Bank Securities. Congress yesterday passed a $168 billion economic stimulus package to head off a recession. The bill will allow Fannie and Freddie to raise the limit on purchasing 'jumbo' loans to $729,750 from $417,000. Mortgages will be eligible if they were granted between July 2007 and Dec. 31, 2008."

Orange County Register - "Late Jan. home sales up in just 3 O.C. ZIPs" (2-8-08)

"DataQuick stats show home sales down 44.1% vs. a year ago, for the 22 business days ended Jan. 23. Only three O.C. ZIP codes had sales gains in the period vs. ‘07 — Irvine 92612 (+107%), Tustin 92782 (+95%) and Irvine 92606 (+12.5%). And, almost as noteworthy, is that the biggest losers — in terms of year-to-year percentage drops — don’t come from the county’s urban core: La Palma 90623 (-83%); Foothill Ranch 92610 (-79%) and Placentia (-75%)."

Los Angeles Times - "Value of homes rigged, lawsuit says" (2-8-08)

"As home prices soared higher earlier this decade, the buying frenzy was fueled in part by what real estate industry experts now claim were exaggerated -- or outright fraudulent -- appraisals. A lawsuit filed by two couples this week adds a new twist: It claims that Los Angeles builder KB Home and a unit of lender Countrywide Financial Corp. pumped up appraisals in their Sacramento-area development to sell homes at higher prices."

Real Estate Journal - "Housing Forecast:More Storms" (2-8-08)

"If home prices are near a bottom, then the Fed -- and its allies in the White House and Congress -- probably have deployed enough forces to prevent a deep, prolonged recession. But if those prices still have a long way to fall, then the Committee to Save the World (Version 2.0) -- Mr. Bernanke and Treasury Secretary Henry Paulson, in place of predecessors Alan Greenspan, Robert Rubin and Lawrence Summers -- is going to need heavy artillery and air support."

NAHB - "Remodeling Activity Declines Slightly In Fourth Quarter" (2-7-08)

"Remodeling activity showed pressure from the housing downturn during the fourth quarter of 2007, according to the National Association of Home Builder’s (NAHB) Remodeling Market Index (RMI). The current market conditions indicator decreased to 40.9 from 46.2 in the third quarter. And the future expectations measure declined to 37.9 from 43.3 in the previous quarter."

NAR - "Existing-Home Sales to Hold in Narrow Range, then Begin Upward Trend" (2-7-08)

"Lawrence Yun, NAR chief economist, said sales activity is expected to remain soft through the first half of the year despite a generational low in mortgage interest rates. 'Household formation was only half of what it should have been last year given the demographics of a growing population and sustained job growth, so there clearly is a pent-up demand from buyers who are on the sidelines,' he said."

NAR - "Fannie and Freddie Reform Will Significantly Impact Housing Market, Says NAR" (2-7-08)

"The National Association of Realtors® today expressed ongoing support for legislative reform to Fannie Mae and Freddie Mac that would help stabilize the housing market and improve liquidity to the secondary nonconforming market. NAR stressed the importance of permanently increasing the loan limits as part of any reform package; that will help encourage healthier conditions in the housing market and strengthen the national GDP."

Yahoo - "D.R. Horton Swings to 1Q Loss on Charges" (2-7-08)

"D.R. Horton Inc., the nation's largest homebuilder, said Thursday it swung to a loss in its fiscal first quarter, due to hefty charges to write off inventory and land values as the housing slump continues to worsen. Losses for the quarter ended Dec. 31 totaled $128.8 million, or 41 cents per share, compared with profit of $109.7 million, or 35 cents per share, a year ago. The 2008 quarter includes $245.5 million in pretax charges to write down inventory and the value of land deposits."

Financial Times - "S&P unveils ratings overhaul" (2-7-08)

"Standard & Poor’s will on Thursday unveil a wave of business reforms in an effort to quell mounting regulatory pressure and investor anger about the failure of credit ratings agencies to foresee subprime housing losses. The agency will pledge to overhaul the way it measures the riskiness of securities, step up investor education and reduce potential conflicts of interest by taking steps such as rotating analysts around beats."

CNN - "Mortgage rates flat on recession fears" (2-7-08)

"Mortgage rates were flat this week, following a disappointing service sector report, Freddie Mac said Thursday. The government-sponsored loan buyer said the rate on a 30-year fixed-rate loan averaged 5.67% for the week ending Thursday, down from 5.68% last week, and still well below rates at this time last year Freddie Mac noted."

CNN - "Freddie, Fannie debt may pose risk to economy" (2-7-08)

"The increased share of housing debt taken on by Freddie Mac and Fannie Mae during the housing slump has put the two government sponsored enterprises at risk, it was charged Thursday. The two outfits are "reducing risks in the market, but concentrating mortgage risks on themselves. These risks are beginning to take their toll," said James Lockhart, director of the Office of Federal Housing Enterprise Oversight (OFHEO), which regulates Fannie and Freddie. He was speaking Thursday at a Senate Banking committee on regulatory reform."

Bloomberg - "MGIC Says Sales May Fall as It Seeks to Reduce Losses" (2-7-08)

"MGIC Investment Corp., the largest U.S. mortgage insurer, is scaling back coverage in California, Florida, Arizona and Nevada to reduce losses on loans. The company will offer fewer policies to homebuyers who don't have top credit scores, Milwaukee-based MGIC said today in a regulatory filing. The insurer will also tighten standards in parts of 14 other states."

Bloomberg - "Ackermann Says Bond Insurers Threaten Debt `Tsunami'" (2-7-08)

"Ackermann made his comments on the day Deutsche Bank said fourth-quarter profit fell 48 percent, less than analysts estimated, to 953 million euros ($1.39 billion) as it avoided the collapse of the U.S. subprime mortgage market. The shares rose 0.4 percent to 75.27 euros in Frankfurt, valuing the bank at 40 billion euros. JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon said the third-largest U.S. bank may lose $200 million if bond insurers have their credit ratings lowered, at a conference today in Naples, Florida."

Real Estate Journal - "Builders Court Buyers With 'Price Protection'" (2-7-08)

"As the housing slump drags on, some builders have a deal for potential buyers: Sign a contract, and if the cost of comparable homes drops before closing, you get the lower price. Companies including KB Home and Ryland Group hope such "price protection" guarantees will lessen consumers' paralyzing fears about buying real estate whose value is falling and get them to the dotted line, bring in much-needed cash and reduce high cancellation rates."

Mortgage Bankers Association - "Purchase Applications Increase In Latest MBA Weekly Survey" (2-6-08)

"The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending February 1, 2008. The Market Composite Index, a measure of mortgage loan application volume, was 1086.6, an increase of 3.0 percent on a seasonally adjusted basis from 1054.9 one week earlier. On an unadjusted basis, the Index increased 4.4 percent compared with the previous week and was up 73.2 percent compared with the same week one year earlier."

Bloomberg - "Toll Has Seventh Straight Drop in Quarterly Revenue" (2-6-08)

"Toll Brothers Inc., the largest U.S. luxury homebuilder, reported its seventh consecutive quarterly drop in revenue as demand for new homes continued to fall. Homebuilding revenue dropped 22 percent to $842.7 million in the fiscal first quarter from a year earlier. Horsham, Pennsylvania-based Toll said in a statement today it may incur as much as $300 million in pretax expenses to write down the value of property."

The San Diego Union Tribune - "Bubble trouble in Treasury market?" (2-6-08)

"Investors' raging demand for safe assets over the past six months may have created a bubble in the Treasury market – and some onlookers expect to hear a bursting sound any minute now. A market bubble exists when asset prices are driven well above their intrinsic value, as occurred with stocks in 1999 and housing prices in many parts of the country in 2006. The end of a bubble is often marked by disruptively sharp price declines as investors abruptly conclude that assets are overvalued."

Bloomberg - "Morgan Stanley Cries Mommy, SEC Comes Running" (2-6-08)

"First the Securities and Exchange Commission's chief accountant gave the subprime-lending industry a valentine that wasn't in his power to bestow. Now some of the accounting rule-makers are starting to push back. The SEC's Conrad Hewitt got things rolling with a Jan. 8 letter, blessing an industry plan to keep problem subprime mortgages off lenders' balance sheets while freezing their interest rates. Hewitt's letter came in response to requests by the Treasury Department and a group called the American Securitization Forum, whose accounting committee is led by a Morgan Stanley managing director, Esther Mills."

CNN - "Troubled homeowners: Can't pay? Just walk away" (2-6-08)

"Homeowners are abandoning their homes and, more importantly, their mortgages, rather than trying to keep up with rising payments on deteriorating assets. So many people are handing their keys back to lenders that a new term has been coined for it: jingle mail."

Bloomberg - "Goldman's Viniar Says Fear Rules in Credit Markets" (2-6-08)

"'Credit markets are trading like we're in the middle of the worst recession we've seen in a very, very long time,' Viniar said at an investor conference in Naples, Florida, sponsored by Credit Suisse Group. Executives from Morgan Stanley and Merrill Lynch & Co. also said demand for debt remains weak."

Orange County Register - "O.C. No. 2 when it comes to least affordable rents" (2-6-08)

"Last year an O.C. worker needed to make $28.56 an hour ($59,404.80 a year) to afford the average $1,485 fair market rent for a two-bedroom apartment, says the non-profit Center for Housing Policy in Washington, D.C. That is out of reach for most of the service industry workers — the burger flippers, hotel workers and sales clerks — that keep O.C.’s economy humming. Even an entry-level worker in a white collar job might have trouble making that much. To be fair, paychecks of sales clerks and service workers fell short of rents in all 210 metropolitan areas studied. Only in San Francisco did workers find it harder to afford rents than in O.C. Hourly workers there had to make $29.83 ($62,046.40/ year) last year to afford the average $1,551 rent for a two-bedroom apartment."

Real Estate Journal - "Commentary: How to FixThe Housing Crisis" (2-6-08)

"If U.S. policy-makers really want to help our ailing economy they will treat the cause of our problem, not the symptoms. Unfortunately, this is easier said than done. Treating the symptoms -- a flagging economy, with falling sales and rising unemployment -- is usually easier, since it does not require complicated explanations and can be tailored to fit the politicians' preferences."

Bloomberg - "CDO Ratings to Fall as Losses Trigger Fitch Overhaul" (2-5-08)

"Fitch Ratings may downgrade all of the $220 billion of collateralized debt obligations it assesses that are based on corporate securities because of rising losses. The New York-based company may lower the notes by as much as five levels after failing to accurately assess the risk of debt that packages other assets, according to guidelines proposed by Fitch today. CDOs with AAA grades that are based on credit-default swaps and aren't actively managed may face the steepest reductions."

USA Today - "Even credit-worthy borrowers face more hurdles" (2-5-08)

"U.S. banks are toughening standards for home mortgages and commercial real estate development loans, seeing more sluggish demand and predicting further delinquencies, according to a Federal Reserve survey released Monday that added to concerns about the faltering economy."

Bloomberg - "Standard Pacific Rises on Loan Waiver, Debt Reduction" (2-5-08)

"Standard Pacific Corp., the California builder that has lost more than three-quarters of its value in the past year, rose as much as 21 percent in New York trading after getting a waiver from lenders to avoid default. Banks extended loan terms until March 30, Irvine, California-based Standard Pacific said in a regulatory filing today. The company said yesterday it cut debt and inventory in the fourth quarter and fiscal year."

Bloomberg - "GMAC Posts $724 Million Loss as Mortgage Loans Sour" (2-5-08)

"GMAC LLC, the auto and mortgage lending company 49 percent owned by General Motors Corp., posted a $724 million fourth-quarter loss as bad loans in the U.S. rose to a record. The net loss compares with a profit of $1 billion a year earlier, the Detroit-based company said in a statement. GMAC, whose majority owners include Cerberus Capital Management, is talking to buyers for parts of the Residential Capital mortgage unit, which had a $921 million loss."

Orange County Register - "Empty O.C. apartments a growing trend" (2-5-08)

"New evidence is out that Orange County’s apartment market continues to soften, at least among large complexes. Axiometrics Inc., the Dallas-based apartment analytics firm, reports that the current O.C. occupancy rate is 94.5%, down 1.3 percentage points from the first quarter of 2007. It’s the lowest since the first quarter of 2002 when occupancy was at 94.9%, says Axiometric’s Jay Denton. That was during the slowdown that followed the dot-com crash and the 9/11 terrorist attack."

Real Estate Journal - "Is a Mortgage the Best HomeFor a Year-end Bonus?" (2-5-08)

"With the market gyrating and real-estate prices tanking, deciding what to do with a windfall isn't exactly easy these days. Anyone carrying high-interest credit-card debt should pay it off. After that, the choices get tougher. You could scoop up some beaten-down stocks or battered high-yield bonds, figuring they'll rebound. Or you could play it safe and pay down your mortgage. If the slowing economy has you worried, the mortgage option can look attractive. Say you received a $100,000 year-end bonus and have a $300,000, 30-year, 6% fixed-rate mortgage. If you took out the mortgage at the start of 2006 and simply make the regular monthly payment, you'll pay it off in early 2036. If you put the $100,000 bonus toward the mortgage, you'll pay it off more than 15 years earlier, in late 2020."

Mortgage Bankers Association - "MBA Reports Commercial/Multifamily Originations Down in Q4" (2-4-08)

"Commercial and multifamily mortgage bankers' loan originations fell on a year-over-year basis in the fourth quarter, according to the Mortgage Bankers Association’s (MBA) Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations. Fourth quarter originations were sixteen percent lower than during the same period last year. The year-over-year decrease was seen across most property types and investor groups."

The San Diego Union Tribune - "A shabby mess" (2-4-08)

"In a dozen different ways, it's become plain that the toxic combination of greed and dishonesty produced the mortgage and housing crisis that threatens to drag the U.S. economy into a recession. The latest evidence of this involves Washington Mutual, the nation's largest savings and loan. Jennifer Wertz, a Sacramento appraiser, is suing WaMu for allegedly blackballing her firm in retaliation for Wertz's refusal to inflate the value of homes involved in pending loans. In May 2007, Wertz contends, a WaMu manager demanded she change her description of local property values from 'declining' to 'stable.' Wertz says she refused – and never was hired by WaMu again."

CNN - "Home equity loan defaults soar" (2-4-08)

"One of the last sources of ready cash for homeowners looking to get money from their house appears to be shutting down and the results aren't likely to be pretty for the economy.
Last week, buried deep in the ugly details of Countrywide Financial Corp.'s earnings release, was the news that its $32.4 billion portfolio of prime HELOCs - home equity lines of credit - had begun to rapidly deteriorate. The reeling Calabasas, Ca.-lender was forced to take a $704 million charge related to homeowners' inability to pay back equity they extracted from their homes."

Bloomberg - "Romney, Clinton Put Economy First in Subprime-Hit California" (2-4-08)

"In the sprawling new subdivisions of Southern California's Riverside County, newspapers litter empty driveways and coffee-colored lawns are reminders of neighbors who had to abandon their dream homes. California leads the nation in home foreclosures, and economic worries are driving the voters who have the biggest say in tomorrow's Super Tuesday contests, when more than 20 states will hold primaries or caucuses. California is the big prize, with the most delegates at stake, for both Democrats and Republicans."

Real Estate Journal - "Worried Sellers SplurgeOn Home Renovations" (2-4-08)

"Some experts warn that sellers are unlikely to get their money back from extensive renovations. But owners often feel they have no choice if they want to sell, especially when builders of newly constructed homes are throwing in hardwood floors, finished basements and other free upgrades."

The Washington Post - "The Boom Was a Bust For Ordinary People" (2-3-08)

"It begins to sound a bit naughty -- all this talk about the need to "stimulate" the economy, as if we were discussing how to make a porn film. I don't mean to trivialize our economic difficulties or the need for effective government intervention, but we have to face a disconcerting fact: For years now, that strange stimulus-crazed beast, the economy, has been going its own way, increasingly disconnected from the toils and troubles of ordinary Americans."

The San Diego Union Tribune - "Foreign nations buying into the U.S." (2-3-08)

"Although Americans are alarmed by the credit crisis currently convulsing the economy, they are sensibly placid about one consequence of the crisis. It is the substantial investment by sovereign wealth funds – government-owned-and-run investment funds – in financial institutions needing infusions of cash."

The San Diego Union Tribune - "Money-market funds tanking? There are some other options" (2-3-08)

"Even before the Federal Reserve's latest rate cut last week, yields on money-market funds were dropping, leaving savers in a pinch. Now, the situation looks to get even uglier. Still, a few attractive alternatives remain. These include higher-yielding certificates of deposits and, for those willing to take on a bit more risk, some short-term bond mutual funds."

TownHall.com - "The Hidden Costs of Recession" (2-3-08)

"Remember the patriotic ruckus in 1989 when private Japanese investors bought Rockefeller Center? Remember the frenzied opposition two years ago to the attempt by a company owned by the government of Dubai to become the operator of some U.S. ports? Last month, there was no comparable anxiety when the sovereign wealth funds of Kuwait, Singapore and South Korea bought an estimated $40 billion of equity in Citigroup, Merrill Lynch, Morgan Stanley and the Swiss bank UBS."

Yahoo - "More Data on Housing, Spending This Week" (2-3-08)

"The stock market has been on the upswing, but few investors are relaxing just yet. This week's data on housing, retailers and labor costs will give Wall Street an idea of whether the economy is weakening or inflation is accelerating -- or both."

Orange County Register - "Bidders seek bargain homes at Anaheim auction" (2-3-08)

"About 5,000 people, many of them looking for real estate bargains, filled a hall at the Anaheim Convention Center on Saturday for an auction of foreclosed homes. Julie Finaldi of Corona and her husband picked up a two-bedroom, 900-square-foot house in Riverside with a winning bid of $150,000. Under the auction rules, a 5 percent 'buyer's premium' was added to the bid, resulting in a sale price of $157,500."

Bloomberg - "California Slump, Illinois Job Loss Buffet Candidates" (2-1-08)

"Super Tuesday, when about half the Democratic and Republican delegates are at stake in the U.S., is billed as a national presidential primary. When it comes to economic issues, it's an amalgam of very different contests. Falling home values and the collapse of the subprime- mortgage market are the major worries in several states, including the biggest prize on Feb. 5, California. A slowing automotive industry and manufacturing-job losses dominate Midwestern states like Illinois and Missouri, and parts of the South. Financial industry losses are a burden in the Northeast."

Reuters - "Greenspan defends subprime role to Swedish bankers" (2-1-08)

"Ex-Federal Reserve chief Alan Greenspan told a Stockholm audience on Friday he did not believe he had caused the U.S. subprime crisis and had warned of the risk in 2004, a person attending the event said. The participant in the event held by Sweden's Handelsbanken, which was closed to media, said Greenspan was reluctant to discuss last month's pair of aggressive interest-rate cuts by the Fed."

Bloomberg - "Centro MCS' U.S. Syndicate Cuts Dividend as Assets Lose Value" (2-1-08)

"Centro Properties Group, the Australian owner of U.S. malls that put itself up for sale, said it will cut distributions to investors in one of its U.S. syndicates because its assets have lost value. Centro MCS 36, which had A$337.2 million ($301 million) in assets as of June 30, will cut distributions to 7 percent a year, from 8.35 percent, in the nine months to June 30, 2008, Centro said yesterday on its Web site. Valuations decreased for the properties owned by the vehicle, which include the A$30 million Christmas Tree Plaza in Connecticut, Melbourne-based Centro said."

Bloomberg - "Beazer Exits Mortgage Business, Quits Four Markets" (2-1-08)

"Beazer Homes USA Inc., the homebuilder under investigation by the U.S. Securities and Exchange Commission, plans to exit the mortgage business and stop selling homes in four markets. Beazer will withdraw from Charlotte, North Carolina; Cincinnati-Dayton and Columbus, Ohio; Columbia, South Carolina, and Lexington, Kentucky. Countrywide Financial Corp. will become the company's preferred loan provider, the Atlanta-based builder said today in a statement. The shares rose as much as 7.9 percent."

Bloomberg - "Wall Street Embraces Government to Avoid Recession" (2-1-08)

"With U.S. mortgage foreclosures set to top 1 million this year and home prices falling at the fastest pace since the Great Depression, Lehman Brothers Holdings Inc. Vice Chairman Thomas Russo says the government must take action to prevent a recession."

Los Angeles Times - "Trying to tap into home equity? We'll see" (2-1-08)

"Tens of thousands of homeowners with home equity lines of credit are getting a rude surprise: They've been told by their lender that they can no longer take money out on their credit lines because sinking home prices have left them with little or no equity."

Los Angeles Times - "New federal foreclosure agency sought" (2-1-08)

"Senate Democrats demanded Thursday a much more forceful response to the crisis of home foreclosures, including the possible creation of a new government body that would purchase failing mortgages and help troubled borrowers refinance into new loans. The proposed entity, dubbed the Home Ownership Preservation Corp., echoes government efforts during the Great Depression."

Orange County Register - "Calif. real estate licenses suffer first drop since '99" (2-1-08)

"California real estate licenses dropped last month from the year before for the first time since March 1999, ending a 7 ½ upswing in which licensees increased by 81 percent. The California Department of Real Estate reported that the state had 548,959 licensees last month. That's still the third highest number on record, and it's equal to one licensee for every 22 California households or one for every 1.4 homes sold last year."

Orange County Register - "Construction work suffers 11% unemployment" (2-1-08)

"Last month’s unemployment rate for U.S. construction workers is 11%, up from 8.9% a year ago and 9% in January 2006. Now, to be fair, construction’s a seasonal business, so comparing these workers’ plight to the overall jobless rate (4.9% “seasonally adjusted”) at this time of year is silly. But it’s an honest trend to note that the 1.1 million construction workers who told government pollsters that were out of work last month is 177,000 more than January 2007, a 19% jump, and is the highest January total since 2003."

Real Estate Journal - "Applications for RefinancingMortgages Increase" (2-1-08)

"Homeowners' applications to refinance loans surged again in the Mortgage Bankers Association's latest survey of filings, rising 22.1% last week from the previous one. According to the survey, refinancings accounted for 73% of the total number of mortgage applications filed during the week ended Friday, up from 66% the previous week."

Real Estate Journal - "More Subprime PainIs on the Way" (2-1-08)

"After racking up more than $100 billion in mortgage-related losses in recent months, banks and their investors had hoped they were out of the woods. They aren't. UBS AG's warning Wednesday that its 2007 write-downs would be $4 billion higher than it predicted last month signaled that further pain may lie ahead for Wall Street banks still vulnerable to the U.S. housing sector's strife."