Register or Sign in        Email This Page     Link To This Page    
Visit MND at MBA in NYC!
# of User Comments
Select a Date
Use the calendar to view news headlines from a specific date.
Today  |  Yesterday  |  Random
Bottom Right Default
State Name: Connecticut
State Name underscore: Connecticut
State Name dash: Connecticut
State Name lower underscore: connecticut
State Name lower dash: connecticut
State Name lower: connecticut
State Abbreviation: CT
State Abbreviation Lower: ct
Suggest a Story
Paste the URL of the story below to submit for editorial review and possible inclusion in ATW.
Please add 2 and 3 and type the answer here:
Leave this field blank.
What is Around the Web?
It is a continuously updated stream of news from around the web
Visit throughout the day for the latest breaking news.
» Click any link below to read more.
  • Tue, Apr 14 2009
  • 11:10 AM » Mortgage Fraud in 2008: Part II
    Published Tue, Apr 14 2009 11:10 AM by Calculated Risk Blog
    Here is the 2nd part of the VoiceofSanDiego article: In 2008, when the loans were made to McConville's buyers, some of the only companies still willing to buy these bundles of mortgages were Fannie Mae and Freddie Mac, even though the mortgage mess had affected them, too. At the tail end of McConville's deals, last September, the federal government took over Fannie and Freddie, assuming more direct control of the companies' day-to-day operation and pumped in funding to absorb their losses. Now the taxpayers own 79.9 percent of Fannie Mae and Freddie Mac. "You and I are getting stuck with these inflated loans, via Fannie and Freddie," [Real estate appraiser Todd Lackner] said. There is a way out, as long as the smaller lenders who made the loans to McConville's buyers still exist. On any loans Fannie and Freddie bought, if they discover fraud or faults in underwriting in the loans, they'll send them down the chain, requiring the investor that sold the loans to the giants to buy them back. Ultimately, the original lenders might face those buybacks, said Michael Lea, a former chief economist for Freddie Mac. But the small lenders who made these mortgages might not be in business anymore -- like Nazari's All American Finance. Ask Wall Street what happens when they push back loans to the small lenders - they just close up shop. Here was Part I: And a related article:
    Click Here to Read the Full Article

    Source: Calculated Risk Blog
  • 11:10 AM » “Liberating” REOs For The Homeless
    Published Tue, Apr 14 2009 11:10 AM by
    , and an ever growing number of homeless people. : [Thanks L!] MIAMI — When the woman who calls herself Queen Omega moved into a three-bedroom house here last December, she introduced herself to the neighbors, signed contracts for electricity and water and ordered an Internet connection. What she did not tell anyone was that she had no legal right to be in the home. Ms. Omega, 48, is one of the beneficiaries of the foreclosure crisis. Through a small advocacy group of local volunteers called Take Back the Land, she moved from a friend’s couch into a newly empty house that sold just a few years ago for more than $400,000. While squatting is not legal, Take Back the Land operates in the open and works to have "responsible squatters": Take Back the Land has had to compete with less organized squatters, said Max Rameau, the group’s director. “We had a move-in that we were going to do one day at noon,” he said. “At 10 o’clock in the morning, I went over to the house just to make sure everything was O.K., and squatters took over our squat. Then we went to another place nearby, and squatters were in that place also.” Mr. Rameau said his group differed from ad hoc squatters by operating openly, screening potential residents for mental illness and drug addiction, and requiring that they earn “sweat equity” by cleaning or doing repairs around the house and that they keep up with the utility bills. “We change the locks,” he said. “We pull up with a truck and move in through the front door. The families get a key to the front door.” Most of the houses are in poor neighborhoods, where the neighbors are less likely to object. This is a video interview on CNN with Rameau of last December: It seems like there should be a better way. , and folks who could really use a roof over their heads. It would be nice if there were a legal way to bring them both together.
    Click Here to Read the Full Article

  • 11:10 AM » It's the lost jobs, not the mortgage payments
    Published Tue, Apr 14 2009 11:10 AM by
    Filed under the category "no easy solutions to the foreclosure crisis" comes a at CNN/Money about how the recent White House plan to rescue homeowners by lowering their mortgage payments may be a bit wide of the mark given all the recent job losses. Unemployment is a bigger reason for missed mortgage payments than high interest rates, according to a study from the Boston Federal Reserve that raises questions about President Obama's plan to stem foreclosures by modifying loans. Borrowers are more likely to default on their payments because they have lost their jobs or because the price of their homes has plummeted than because of tough terms on their mortgages, the study found. Normally, foreclosures are an after-effect of recessions - people lose their jobs, then they lose their homes because they can't make their mortgage payments. It seems as though we're now just entering that phase after the loss of 3.7 million jobs over just the last six months. What's the solution? Naturally, it's the same solution that has been offered for nearly every phase of the financial crisis - more money from the government. Since the government owns or guarantees most of the mortgages in the U.S. these days, it's more than a little funny that one agency in Washington D.C. would be lending you money so you can make a payment that winds up in another Washington D.C. office. The economists suggest that the government could instead replace part of an individual homeowner's lost income from a job loss through loans and grants and help those whose predicament is more permanent become renters.
    Click Here to Read the Full Article

  • 8:34 AM » Bernanke: ‘Fundamentally Optimistic’ About Economy
    Published Tue, Apr 14 2009 8:34 AM by WSJ
    Federal Reserve Chairman Ben Bernanke said Tuesday that he sees “tentative signs” that the steep contraction in U.S. economic activity may be waning, and that he is confident in the economy’s long term prospects. In remarks prepared for delivery later today in Atlanta, Bernanke cited recent figures on housing, consumer spending and new vehicle sales as some of those signs that the recession is slowing. Here’s the full text: Four Questions about the Financial Crisis I am pleased to have the privilege of speaking today to the students and faculty of Morehouse College, the only all-male historically black institution of higher learning in the United States. It is sufficient to note that Martin Luther King, Jr., was a graduate of Morehouse. Yet a roster of distinguished alumni that also includes former Atlanta Mayor Maynard Jackson, former U.S. Surgeon General David Satcher, and filmmaker Spike Lee testifies to the success of your stated mission of “producing academically superior, morally conscious leaders for the conditions and issues of today.” My remarks today will focus on the ongoing turmoil in financial markets and its consequence, the global economic recession. The financial crisis, the worst since the Great Depression, has severely affected the cost and availability of credit to both households and businesses. Credit is the lifeblood of market economies, and the damage to our economy resulting from the constraints on the flow of credit has already been extensive. With recent job losses exceeding half a million per month, this year’s college graduates are facing the toughest labor market in 25 years. In the communities in which you and I grew up, many families are trying to cope with lost employment and depleted savings or are facing foreclosure on their homes. Firms have shut factories and cancelled construction projects. States and municipalities are scrambling to find the funding to provide critical services. And although we naturally tend to be most aware of...
  • 8:34 AM » Report: Fannie Mae CEO Allison to head TARP (AP)
    Published Tue, Apr 14 2009 8:34 AM by
    Fannie Mae CEO Herb Allison is expected to be named by the Obama administration to head the government's $700 billion Troubled Asset Relief Program, a published report said.
    Click Here to Read the Full Article

  • 8:34 AM » SEC Reviewing if BofA Broke Law: Report (at
    Published Tue, Apr 14 2009 8:34 AM by
    SEC Reviewing if BofA Broke Law: Report (at
    Click Here to Read the Full Article

  • Mon, Apr 13 2009
  • 4:32 PM » Wells Fargo May Need $50 Billion in Capital, KBW Says
    Published Mon, Apr 13 2009 4:32 PM by Bloomberg
    Wells Fargo & Co., the second- biggest U.S. home lender, may need $50 billion to pay back the federal government and cover loan losses as the economic slump deepens, according to KBW Inc.’s Frederick Cannon.
  • 4:23 PM » Bailed-out banks face probe: WSJ
    Published Mon, Apr 13 2009 4:23 PM by Market Watch
    The committee that oversees the government’s bailout programs is looking into whether banks that took taxpayer money to improve their balance sheets have since been raising interest rates and fees, according to The Wall Street Journal.
  • 3:13 PM » Fed purchases $5.153 billion in GSE Agency Coupons
    Published Mon, Apr 13 2009 3:13 PM by NY Fed
    The current program to purchase direct obligations from housing-related GSEs is intended to reduce the cost and increase the availability of credit for the purchase of homes.
  • 2:49 PM » The Fed's "squandered independence"
    Published Mon, Apr 13 2009 2:49 PM by
    With growing optimism that the worst may now be behind it for the U.S. economy, a growing number of observers are starting to look at what sort of an economic landscape might take shape should the optimists be right, given all the money creation over the last year or so to bailout financial firms and effectively nationalize the mortgage lending industry. According to Allan Meltzer, one of the world's foremost experts on U.S. monetary policy, the outlook is not good and it has much to do with the historical role of the Federal Reserve as an independent organization as described in this at Bloomberg. Meltzer says political pressure will prevent Bernanke, 55, and fellow policy makers from withdrawing liquidity quickly enough as the economy recovers . That’s similar to the pattern that occurred back in the 1970s, he says. Then-Chairman Arthur Burns allowed excessive money-supply growth because he was unable or unwilling to resist pressure from President Richard Nixon’s White House to hold down unemployment, leading to the “great inflation” of that era, he says. Now, Bernanke and fellow policy makers have “squandered their independence” by becoming involved in bailouts of financial firms and by taking long-term and illiquid assets onto their balance sheet, Meltzer says. “They don’t have the political ability to control inflation.” It really is too bad for the central bankers of the world that the labor market is a lagging indicator. During the latter stages of a recession, when other economic statistics begin pointing unambiguously upward, job losses generally continue at a healthy pace and this can make reining in easy money an exceedingly difficult task. That's one of the most important reasons why the Federal Reserve was created as an independent organization - to do what's best for the economy in the long-term regardless of the political whims and wishes in Washington. [Note: Yes, the most important reason for the Fed's independence is its unholy relationship...
    Click Here to Read the Full Article

  • 2:49 PM » Mortgage Fraud: RICO Charges Filed Against Straw Buyers
    Published Mon, Apr 13 2009 2:49 PM by Calculated Risk Blog
    Here is another story from VoiceofSanDiego: Federal prosecutors on Tuesday announced unprecedented charges against individuals involved in an alleged mortgage fraud ring involving 220 properties in San Diego County, with total purchase prices topping $100 million. The 24 defendants were all charged with participating in a "corrupt enterprise" under a federal law created by the Racketeer Influenced and Corrupt Organizations (RICO) Act... ... defendants include several real estate professionals ... a public notary ... a licensed real estate agent ... a licensed real estate appraiser ... a CPA; and ... registered tax preparers. ... Prosecutors also name several straw buyers as participants in the corrupt enterprise ... This is a different case than the previous story, but notice that the straw buyers are facing charges too. "Lend" out your good credit, sign false documents - and face prosecution and jail time.
    Click Here to Read the Full Article

    Source: Calculated Risk Blog
  • 11:25 AM » Taxpayer Funded GS Profits
    Published Mon, Apr 13 2009 11:25 AM by The Big Picture
    Note: By coincidence, this post was written in International Waters a few miles off the coast of Grand Turks and Caicos. If Goldman Sachs wants to sue anyone over this, send your process server to the wreck of the B-29 bomber, off the north coast, approximately 80 feet below sea level . . . ~~~ that a nasty rumor is circulating about Goldman Sachs amongst observers of the Street. Allegedly, GS is about to report their second-best quarter in history, +$12 billion or so… In this era of finacial disasters, credit crisis, and recession, how is that possible? Easy. You — and your grandkids — are the ones who paid for it: “The fact that they (like so many others) are being paid by the taxpayer through AIG’s “conduit” for losses that didn’t (yet) happen at 100 cents on the dollar might be the basic math. And further (and potentially much worse) there is the repeated statement by Goldman executives that they were “fully hedged” against a potential counterparty default by AIG. One wonders - was that “hedge” to be short the equity on AIG itself, perhaps? Why is this important? Because if that’s how Goldman hedged they got paid twice and the taxpayer literally got robbed. Someone in Congress needs to look into this now; there are already rumblings of investigation. Those rumblings need to get a lot louder and turn into subpoenas, not “polite inquiries.” If in fact Goldman (or anyone else) was “hedged” against a possible credit loss from their CDS with AIG and they were able to collect on that hedge (no matter what it was) those payments through AIG need to be clawed back immediately as nobody is entitled to be paid twice for the same risk and reap what amounts to a windfall profit by quite literally engineering a multi-billion dollar transfer of funds from the Taxpayer to the firm!” Makes you wonder if having a Treasury Secretary who was a former CEO of Goldman Sachs had anything to do with this. Indeed, not only was Hank Paulson Goldie’s boy, but he was the same gentleman who...
    Click Here to Read the Full Article

    Source: The Big Picture
  • 11:25 AM » Secondary Sources: ‘Fake Recovery,’ Fed, Winning the Economic War
    Published Mon, Apr 13 2009 11:25 AM by WSJ
    A roundup of economic news from around the Web. Edward Harrison , writing on naked capitalism, says the economic situation we’re facing is best described as “fake recovery.” He writes, “This is a fake recovery because the underlying systemic issues in the financial sector are being papered over through various mechanisms designed to surreptitiously recapitalize banks while monetary and fiscal stimulus induces a rebound before many banks’ inherent insolvency becomes a problem. This means the banking system will remain weak even after recovery takes hold. The likely result of the weak system will be a relapse into a depression-like circumstances once the temporary salve of stimulus has worn off. Note that this does not preclude stocks from large rallies or a new bull market from forming because as unsustainable as the recovery may be, it will be a recovery nonetheless…In truth, the U.S. banking system as a whole is probably insolvent. By that I mean the likely future losses of loans and assets already on balance sheets at U.S. financial institutions, if incurred today, would reveal the system as a whole to lack the necessary regulatory capital to continue functioning under current guidelines. In fact, some prognosticators believe these losses far exceed the entire capital of the U.S. financial system.” The Economist looks at the Fed’s wavering independence, noting “The Fed’s interventions have been defensible given the scale of the crisis and lack of alternatives, but they have exposed it to public anger over bail-outs for bankers. Tim Geithner , the treasury secretary, owes his recent problems in part to having overseen the bail-out of American International Group , an insurer, in his previous job as head of the New York Fed. The controversy also comes at a delicate moment for the Fed. Two governors’ seats are vacant and Ben Bernanke’s four-year term as chairman ends next January. The Fed also needs favours from Congress: it would like authority to issue debt securities...
  • 11:25 AM » Roubini and the Stress Test Scenarios
    Published Mon, Apr 13 2009 11:25 AM by Calculated Risk Blog
    Professor Roubini writes: : Actual Macro Data Are Already Worse than the More Adverse Scenario for 2009 in the Stress Tests. So the Stress Tests Fail the Basic Criterion of Reality Check Even Before They Are Concluded [I]f you look at the actual data today macro data for Q1 on the three variables used in the stress tests – growth rate, unemployment rate, and home price depreciation – are already worse than those in FDIC baseline scenario for 2009 AND even worse than those for the more adverse stressed scenario for 2009. Thus, the stress test results are meaningless as actual data are already running worse than the worst case scenario. I've noted before that the baseline case is no longer useful, and that the more adverse case is the new baseline. Roubini is taking this a step further and saying the more adverse case is also meaningless. I think this is premature - although I agree with Roubini that there is no real stress test. First, Roubini is working from the annual stress test forecasts. The following table shows the quarterly data being used by the banks. Click on graph for larger image in new window. This table shows the quarterly GDP growth rate (annualized), unemployment rate, and house prices being used for the stress test scenarios. House prices are based on the Case-Shiller Composite 10 Index with Dec 2008 = 100. Unemployment For the unemployment rate, Roubini is correct. The unemployment rate was 8.1% in Q1 - above both the baseline (7.8%) and more adverse (7.9%) scenario rates. [B]ased on current and likely trends the unemployment rate will be – at best over 10% by year end – and more likely closer to 11% by year end (and average 9.8% for the year) 2009 data are already worse than the adverse scenario and will for sure be worse than the adverse scenario. But more importantly by year end 2009 the actual unemployment rate – even with a growth recovery in H2 – will be higher at 10.5% - than the average unemployment rate assumed by the FDIC in the adverse...
    Click Here to Read the Full Article

    Source: Calculated Risk Blog
  • 10:49 AM » Mortgage Servicer Role May Weigh on Banks
    Published Mon, Apr 13 2009 10:49 AM by
    Just as banks are beginning to work the massive amount of bad debt through their systems, a less obvious creature related to the once-booming housing market may pose a threat as mortgage rates decline and homeowners refinance.
    Click Here to Read the Full Article

  • 9:21 AM » Time To Breakup Goldman Sachs
    Published Mon, Apr 13 2009 9:21 AM by Google News
    It's time to breakup Goldman Sachs, Citigroup, and for that matter any bank or holding company deemed too big to fail. It's not just the "too big to fail" hazard that is troubling, it's also the power these corporations have and the potential to abuse that power that is also troubling. Please consider the article as posted on the Zero Hedge blog. A very interesting data point, also provided by the NYSE, implicates none other than administration darling Goldman Sachs in yet another potentially troubling development. The chart below demonstrates the program trading broken down by the top 15 most active NYSE member firms. I bring your attention to the total, principal, customer facilitation and agency columns. Key to note here is that Goldman's program trading principal to agency+customer facilitation ratio is a staggering 5x, which is multiples higher than both the second most active program trader and the average ratio of the NYSE, both at or below 1x. The implication is that Goldman Sachs, due to its preeminent position not only as one of the world's largest broker/dealers (pardon, Bank Holding Companies), but also as being on the top of the high-frequency trading/liquidity provision "food chain", trades much more often for its own (principal) benefit, likely in tandem with the other top dogs on the list: RenTec, Highbridge (JP Morgan), and GETCO. In this light, the program trading spike over the past week could be perceived as much more sinister. For conspiracy lovers, long searching for any circumstantial evidence to catch the mysterious "plunge protection team" in action, you should look no further than this. Readers know that I am not a subscriber to Plunge Protection Team (PPT) theory. However, I am open to the idea that it is possible for Broker Dealers or Bank Holding Companies to be trading their own accounts ahead of customer accounts and/or advising clients (or the public) one way (and trading the other), on...
  • Thu, Apr 9 2009
  • 10:03 PM » Wells Fargo CFO: Public Private Partnerships “A Good Concept”
    Published Thu, Apr 09 2009 10:03 PM by
    By Moe Bedard Wells Fargo is posting a 3 billion dollar profit in the first quarter of 2009. How do you like that Main Street? After accepting TARP funds in the high billions, Wells Fargo was able to acquire Wachovia, one of the largest bank buyouts in American history. Just a year later, the financial [...]
    Click Here to Read the Full Article

  • 10:03 PM » TARP Recipients Required to Modify Loans, HUD Says
    Published Thu, Apr 09 2009 10:03 PM by
    "Banks receiving federal aid through the U.S. Troubled Asset Relief Program must also take part in the government’s mortgage modification initiatives, Housing and Urban Development Secretary Shaun Donovan said."
    Click Here to Read the Full Article

  • 4:49 PM » Servicers are Finally Coming Around
    Published Thu, Apr 09 2009 4:49 PM by
    By Moe Bedard It’s no secret that loss mitigation departments are notorious for terrible customer service. They treat people like criminals for having financial problems. Over the years I’ve written numerous articles suggesting how loss mitigation departments can improve their customer service. First and [...]
    Click Here to Read the Full Article

  • 2:59 PM » The shadow inventory of foreclosed homes
    Published Thu, Apr 09 2009 2:59 PM by
    If ever there were a "squishy" data set, one that is quite difficult to get a good handle on due to the paucity of reliable, publicly available data, it is the inventory of foreclosed homes that have yet to make it onto the resale market. A by Carolyn Said in the San Francisco Chronicle provided the first graphic on the subject that I've seen, an image that was splashed across the front page of yesterday's paper. With bank repossessions and notices of default set to pick up dramatically in some parts of the country as by Mr. Mortgage the other day, all the prognosticators with rosy housing outlooks for 2009 may be in for a wake up call come summer time. If the Alt-A and Option ARM loans begin to sour in large numbers (as many predict) at about the same time that banks look to unload some of their inventory after all the recent optimism, there could be another big leg down in home prices. Some details from the SF Gate story: A vast "shadow inventory" of foreclosed homes that banks are holding off the market could wreak havoc with the already battered real estate sector, industry observers say. Lenders nationwide are sitting on hundreds of thousands of foreclosed homes that they have not resold or listed for sale, according to numerous data sources. And foreclosures, which banks unload at fire-sale prices, are a major factor driving home values down. "We believe there are in the neighborhood of 600,000 properties nationwide that banks have repossessed but not put on the market," said Rick Sharga, vice president of RealtyTrac, which compiles nationwide statistics on foreclosures. "California probably represents 80,000 of those homes. It could be disastrous if the banks suddenly flooded the market with those distressed properties. You'd have further depreciation and carnage." In a recent study, RealtyTrac compared its database of bank-repossessed homes to MLS listings of for-sale homes in four states, including California...
    Click Here to Read the Full Article

  • 2:55 PM » CA Foreclosures About to Soar
    Published Thu, Apr 09 2009 2:55 PM by
    Are you ready to see the future? Ten’s of thousands of foreclosures are only 1-5 months away from hitting that will take total foreclosure counts back to all-time highs. This will flood an already beaten-bloody real estate market with even more supply just in time for the Spring/Summer home selling season - great timing!
    Click Here to Read the Full Article

  • 11:37 AM » How to Avoid a Jumbo Mortgage (And Its Jumbo Rate)
    Published Thu, Apr 09 2009 11:37 AM by CNBC
    Posted By: Assuming you can find one, how do you avoid paying a jumbo’s higher interest rate? You have three options. Topics: | | | |
  • 11:36 AM » Obama Says 9 Million Americans Can Reduce Mortgage Payments
    Published Thu, Apr 09 2009 11:36 AM by
    Obama Says 9 Million Americans Can Reduce Mortgage Payments
    Click Here to Read the Full Article

  • 11:36 AM » Wells Fargo Mortgage Business Drives First Quarter Earnings Record
    Published Thu, Apr 09 2009 11:36 AM by
    Wells Fargo announced today that it expects to report record first quarter earnings of $3 billion thanks in part to the current mortgage bonanza. “Business momentum in the quarter reflected strength in our traditional banking businesses, strong capital markets activities, and exceptionally strong mortgage banking results,” said Chief Financial Officer Howard Atkins. “$100 billion in mortgage originations, [...]
    Click Here to Read the Full Article

  • 11:36 AM » Bank of America Refinancing Under Making Home Affordable Program
    Published Thu, Apr 09 2009 11:36 AM by
    Bank of America said today it has begun processing refinance applications under the Treasury’s “Making Home Affordable” program, with nearly 200,000 customers contacting the company to determine eligibility. “Combined with historically low interest rates, this program has generated significant interest from borrowers seeking the benefit of lower mortgage payments,” said Barbara Desoer, president of Bank of [...]
    Click Here to Read the Full Article

  • 9:30 AM » Quelle Surprise! Bank Stress Tests Producing Expected Results!
    Published Thu, Apr 09 2009 9:30 AM by Google News
    Should this even qualify as news? From the : For the last eight weeks, nearly 200 federal examiners have labored inside some of the nation’s biggest banks to determine how those institutions would hold up if the recession deepened. What they are discovering may come as a relief to both the financial industry and the public: the banking industry, broadly speaking, seems to be in better shape than many people think, officials involved in the examinations say. That is the good news. The bad news is that many of the largest American lenders, despite all those bailouts, probably need to be bailed out again, either by private investors or, more likely, the federal government. After receiving many millions, and in some cases, many billions of taxpayer dollars, banks still need more capital, these officials say. The whole point of this charade exercise was to show the big banks weren't terminal but still needed dough, and I am sure it will prove to be lots of dough before we are done. But they now have the Good Housekeeping seal, so the chump taxpayer can breathe easy that the authorities are taking prudent measures to make sure his money is being shepherded wisely. If you believe that, I have a bridge I'd like to sell you. We said from the beginning the stress tests were a complete sham. Just look at the numbers. 200 examiners for 19 banks? When Citi nearly went under in the early 1990s, it took 160 examiners to go over its US commercial real estate portfolio (and even then then the bodies were deployed against dodgy deals in Texas and the Southwest). This is a garbage in, garbage out exercise. The banks used their own risk models to make the assessment, for instance, the very same risk models that caused this mess. And there was no examination of the underlying loan files. The Times story does slip in some shreds of doubt, but a casual reader is likely to read past them. Consider these statements: Regulators say all 19 banks undergoing the exams will pass them. Indeed...
  • 9:30 AM » A Look Inside Fed’s Balance Sheet
    Published Thu, Apr 09 2009 9:30 AM by WSJ
    In response to the most severe crisis in financial markets since the Great Depression, the Federal Reserve has expanded its balance sheet to unprecedented heights. At the Federal Open Market Committee meeting last month, officials decided to increase the balance sheet further through purchases of some $1 trillion in Treasurys and mortgage securities. show that FOMC members were concerned about a worsening economic outlook and took forceful action in response. In an effort to track the Fed’s actions, Real Time Economics has created an interactive graphic that will mark the expansion of the central bank’s balance sheet. Every Thursday afternoon, the chart will be updated with released by the Fed. In an effort to simplify the composition of the balance sheet, some elements have been consolidated. Portfolios holding assets from the Bear Stearns and AIG rescues have been put into one category, as have facilities aimed at supporting commercial paper and money markets. The direct bank lending group includes term auction credit, as well as loans extended through the discount window and similar programs. Central bank liquidity swaps refer to Fed programs with foreign central banks that allow the institutions to lend out foreign currency to their local banks. Repurchase agreements are short-term temporary purchases of securities from banks, which are looking for liquidity and agree to repurchase them on a specified date at a specified price. Click and drag your mouse to zoom in on the chart. Clicking the check mark on categories can add or remove elements from the balance sheet. You need to upgrade your Flash Player
  • 9:30 AM » Assessing Treasury’s Strategy: Six Months of TARP
    Published Thu, Apr 09 2009 9:30 AM by The Big Picture
    The April oversight report for COP is entitled Assessing Treasury’s Strategy: Six Months of TARP. In this report, COP offers a preliminary look at Treasury’s strategy and offers a comparative analysis of previous efforts to combat banking crises in the past. Over the last six months, Treasury has spent or committed $590.4 billion of the TARP funds. Treasury has also relied heavily on the use of the Federal Reserve’s balance sheet which has expanded by more than $1.5 trillion (not including expected TALF loans) in conjunction with the financial stabilization activities it has undertaken beyond its monetary policy operations. This has allowed Treasury to leverage TARP funds well beyond the funds appropriated by Congress. The total value of all direct spending, loans and guarantees provided to date in conjunction with the financial stability efforts (including those of the FDIC as well as the Treasury and the Federal Reserve) now exceeds $4 trillion. This report reviews in considerable detail specific criteria for evaluating the impact of these programs on financial markets. -
    Click Here to Read the Full Article

    Source: The Big Picture
  • Wed, Apr 8 2009
  • 5:37 PM » Fed sees economy sliding further
    Published Wed, Apr 08 2009 5:37 PM by Reuters
    WASHINGTON (Reuters) - Federal Reserve policy-makers, faced with bleaker forecasts for a rapidly worsening recession, decided to buy a "substantial" amount of U.S. Treasury and mortgage debt to halt the slide, minutes of their most recent meeting showed on Wednesday.
  • 2:43 PM » FOMC minutes
    Published Wed, Apr 08 2009 2:43 PM by Federal Reserve
    Federal Reserve policy-makers agreed at their March 17-18 meeting that "substantial additional purchases" of a range of longer-term assets was appropriate to deal with a steep drop in economic activity across all sectors, minutes of the meeting showed on Wednesday.
    Click Here to Read the Full Article

    Source: Federal Reserve
  • 12:11 PM » Bank of America Needs $36.6 Billion, Oppenheimer Says
    Published Wed, Apr 08 2009 12:11 PM by Bloomberg
    Bank of America Corp., the largest U.S. bank, needs to raise $36.6 billion in equity to bring capital ratios in line with its peers, according to Oppenheimer & Co. With investors reluctant to commit new funds to lenders, Bank of America is more likely to raise capital by converting preferred stock to common, or issuing 5.2 billion shares through the Treasury Department’s Capital Assistance Plan, said analyst Chris Kotowski in a report to clients today. Under the Treasury program, Bank of America may issue shares for $6.24 each, the report said.
  • 12:01 PM » Fed purchases $2.970 billion in Treasury coupons
    Published Wed, Apr 08 2009 12:01 PM by NY Fed
    The purchase or sale of Treasury securities on an outright basis adds or drains reserves available in the banking system. Such transactions are arranged on a routine basis to offset other changes in the Federal Reserve’s balance sheet in conjunction with efforts to maintain conditions in the market for reserves consistent with the federal funds target rate set by the Federal Open Market Committee (FOMC).
  • 9:59 AM » Economist Nouriel Roubini lashes out at CNBC host
    Published Wed, Apr 08 2009 9:59 AM by Washington Post
    TORONTO -- CNBC's Jim Cramer has another feud on his hands.
    Click Here to Read the Full Article

    Source: Washington Post
  • 9:58 AM » Pulte to buy rival Centex for $1.3 billion
    Published Wed, Apr 08 2009 9:58 AM by Reuters
    NEW YORK (Reuters) - Pulte Homes, the fourth-largest U.S. homebuilder, said it would buy the third largest, Centex Corp, for $1.3 billion in stock as it looks to save costs and get through the housing downturn.
  • 9:58 AM » Bernanke's Deflation Preventing Scorecard
    Published Wed, Apr 08 2009 9:58 AM by Google News
    In case no one is keeping track, Bernanke has now fired every bullet from his 2002 “ helicopter drop ” speech . Bernanke's Scorecard Here is Bernanke’s roadmap, and a “point-by-point” list from that speech. 1. Reduce nominal interest rate to zero. Check. That didn’t work... 2. Increase the number of dollars in circulation, or credibly threaten to do so. Check. That didn’t work... 3. Expand the scale of asset purchases or, possibly, expand the menu of assets it buys. Check & check. That didn’t work... 4. Make low-interest-rate loans to banks. Check. That didn’t work... 5. Cooperate with fiscal authorities to inject more money. Check. That didn’t work... 6. Lower rates further out along the Treasury term structure. Check. That didn’t work... 7. Commit to holding the overnight rate at zero for some specified period. Check. That didn’t work... 8. Begin announcing explicit ceilings for yields on longer-maturity Treasury debt (bonds maturing within the next two years); enforce interest-rate ceilings by committing to make unlimited purchases of securities at prices consistent with the targeted yields. Check, and check. That didn’t work... 9. If that proves insufficient, cap yields of Treasury securities at still longer maturities, say three to six years. Check (they’re buying out to 7 years right now.) That didn’t work... 10. Use its existing authority to operate in the markets for agency debt. Check (in fact, they “own” the agency debt market!) That didn’t work... 11. Influence yields on privately issued securities. (Note: the Fed used to be restricted in doing that, but not anymore.) Check. That didn’t work... 12. Offer fixed-term loans to banks at low or zero interest, with a wide range of private assets deemed eligible as collateral (…Well, I’m still waiting for them to accept bellybutton lint & Beanie Babies, but I’m sure my patience will be rewarded. Besides their “mark-to-maturity” offers will be more than enticing!) Anyway… Check. That didn’t work... 13...
  • 9:47 AM » Bail Out for Dummies
    Published Wed, Apr 08 2009 9:47 AM by
    Zero Hedge believes it is a civic duty to represent the total melange of assorted concepts and alphabet soups in the ongoing debacle that is the Bail Out in a comprehensible and easily understandable context as the decisions the administration is making will have generational consequences. Therefore, I am presenting a view of the players, the mechanisms and the core of the Bail Out problem in a way that will be much easier to be comprehended by most interested parties. The conclusion is frightening.
    Click Here to Read the Full Article

  • 9:41 AM » Geithner's Stress Test "A Complete Sham," Former Federal Bank Regulator Says
    Published Wed, Apr 08 2009 9:41 AM by
    The bank stress tests currently underway are “a complete sham,” says William Black, a former senior bank regulator and S&L prosecutor, and currently an Associate Professor of Economics and Law at the University of Missouri - Kansas City. “It’s a Potemkin model. Built to fool people.” Like many others, Black believes the “worst case scenario” used in the stress test don’t go far enough.
    Click Here to Read the Full Article

  • 9:38 AM » FED: Richard Fisher Speech
    Published Wed, Apr 08 2009 9:38 AM by
    Remarks before the Japan Center for Economic Research, Institute for International Monetary Affairs and Japanese Bankers Association.
    Click Here to Read the Full Article

  • Tue, Apr 7 2009
  • 10:16 PM » Real-Estate Industry Pushes Fed on TALF
    Published Tue, Apr 07 2009 10:16 PM by WSJ
    The real-estate industry is lobbying the Fed for modifications to a bailout program that the industry said may avert a wave of commercial-property defaults.
  • 10:16 PM » Mortgage Wipeout
    Published Tue, Apr 07 2009 10:16 PM by WSJ
    Thornburg Mortgage's bankruptcy filing is likely to wipe out a $475 million investment by New York private-equity firm MatlinPatterson Global Advisers.
Did you know?
You can see a list of all comments on MND by clicking the 'Read the Latest Comments' option under the 'Community' menu.

More From MND

Mortgage Rates:
  • 30 Yr FRM 3.63%
  • |
  • 15 Yr FRM 3.25%
  • |
  • Jumbo 30 Year Fixed 3.72%
MBS Prices:
Recent Housing Data:
  • Mortgage Apps -1.21%
  • |
  • Refinance Index -1.77%
  • |
  • Purchase Index -2.01%