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  • Wed, Aug 26 2009
  • 4:14 PM » Recovery rubs off on Freddie, Fannie, AIG
    Published Wed, Aug 26 2009 4:14 PM by
    Shares of Fannie Mae, Freddie Mac and AIG, the three financial groups taken over by the US government at the height of the financial crisis last year, have surged over the past three weeks, making them the most improved stocks on the New York Stock Exchange since early August
    Click Here to Read the Full Article

  • 4:14 PM » HUD announces $50 million in Recovery Act funds to assist local communities stabilize neighborhoods hard hit by foreclosure
    Published Wed, Aug 26 2009 4:14 PM by
    WASHINGTON - U.S. Department of Housing and Urban Development Secretary Shaun Donovan today announced HUD is launching a $50 million effort to help state and local governments address the inventory of foreclosed properties assisted under the Department's Neighborhood Stabilization Program (NSP). HUD is awarding $44.5 million to nine national organizations and another $5.5 million to help local communities purchase, rehabilitate and resell foreclosed properties in especially hard-hit neighborhoods.
  • 3:12 PM » Distressing Gap: Ratio of Existing to New Home Sales
    Published Wed, Aug 26 2009 3:12 PM by Calculated Risk Blog
    For graphs based on the new home sales report this morning, please see: According to the of real estate agents, over 63% of sales in Q2 were distressed. The number of distressed sales has probably declined in Q3, but it is still very high. The July NAR shows "distressed homes accounted for 31 percent of transactions", but their survey is very limited. And even using the NAR numbers, distressed sales are running around 1.5 million this year. All this distressed sales activity has created a gap between new and existing sales as shown in the following graph that I've jokingly labeled the "Distressing" gap. This is an update including July new and existing home sales data. Click on graph for larger image in new window. This graph shows existing home sales (left axis) and new home sales (right axis) through July. As I've noted before, I believe this gap was caused by distressed sales. Even with the recent rebound in new and existing home sales, the gap is still very wide. The second graph shows the same information, but as a ratio for existing home sales divided by new home sales. Although distressed sales will stay elevated for some time, eventually I expect this ratio to decline back to the previous ratio. The ratio could decline because of a further increase in new home sales, or a decrease in existing home sales - or a combination of both. I expect the ratio will decline mostly from a decline in existing home sales as the first-time home buyer frenzy subsides, and as the foreclosure crisis moves into mid-to-high priced areas (with fewer cash flow investors). From a longer term graph of the ratio, see my last month. By request the Feed is Full length and Free of ads. And also by request , once a month, here is a tip jar - to leave a tip. Thanks! CR
    Click Here to Read the Full Article

    Source: Calculated Risk Blog
  • 12:07 PM » Clunkers program draws almost 700,000 takers
    Published Wed, Aug 26 2009 12:07 PM by Market Watch
    The cash-for-clunkers program drew to a close late Tuesday, with almost 700,000 participants grabbing $2.88 billion in rebates to trade their old rides for more fuel-friendly alternatives.
  • 12:06 PM » Treasury Announces $309 Million in Recovery Act Funds
    Published Wed, Aug 26 2009 12:06 PM by US Treasury
    August 26, 2009 TG-267 Treasury Announces $309 Million in Recovery Act Funds to Create Jobs, Provide Affordable Housing WASHINGTON – As part of the Obama Administration's effort to strengthen communities and ease pressures on the housing market, the U.S. Department of the Treasury today announced $309 million in American Recovery and Reinvestment Act (Recovery Act) funding to spur the development of affordable housing units in Arizona, Connecticut, North Carolina, North Dakota, Pennsylvania, South Carolina, and Vermont. "Today's announcement of housing funds demonstrates how the Recovery Act is putting our nation on the path to economic stability, one community at a time," said Deputy Secretary of Treasury Neal Wolin. "This initiative will help spur construction and development, create much needed jobs, and increase the availability of affordable housing for families around the country." Since the program launch in May 2009, the Treasury Department and the Department of Housing and Urban Development have been implementing new efforts designed to help families while providing important assistance to homebuilders. Specifically, the Treasury Department has implemented an innovative program that will provide more than $3 billion from the Recovery Act to put people to work building quality, affordable housing for individuals and families affected by the current crisis. The Treasury Department will work with state housing agencies to jump start the development or renovation of qualified affordable housing for families across the country. Under this program, state housing agencies will receive funds to finance the construction of affordable housing developments. Today, the Treasury Department is announcing the sixth round of recipients for a total of $309 million: $34 million in Arizona; $16 million in Connecticut; $95 million for North Carolina; $3.6 million for North Dakota; $41 million in Pennsylvania; $118 million for South Carolina; and $1.4...
  • 12:05 PM » A Look At the CBOs Latest Projections
    Published Wed, Aug 26 2009 12:05 PM by
    Yesterday the CBO released its long-term budget outlook. It is a lengthy document that involves an area of economics that I find highly questionable: long-term projections. I understand why we must include them and why they are done, but I still find them questionable because they are 50+ year projections. Let's look at a key point: Basically, it's about spending on medical care. That is the primary driver for the increase government expenditures. That is also why it is imperative that we figure out a way to hold down costs. Let's look at some charts that highlight the problem. Click on all for a larger image Social security isn't the problem. It increases to roughly 6% of GDP and then remains stable. This is an entirely manageable situation. However, Medical costs -- the net total spending of medicare and medicaid -- continue to increase until they reach 18% near the end of the decade. That is obviously unsustainable and again highlights why reform is mandatory. I'm still working through the data. The CBOs information is
    Click Here to Read the Full Article

  • 12:05 PM » Colonial BancGroup Files for Bankruptcy Protection
    Published Wed, Aug 26 2009 12:05 PM by CNBC
  • 12:05 PM » Builders overvalued after summer rally: analyst
    Published Wed, Aug 26 2009 12:05 PM by Market Watch
    One Wall Street analyst foresees a September correction for high-flying home-builder stocks, in the belief that lingering concerns over unemployment will curb investor enthusiasm.
  • 9:07 AM » A comment on House Prices
    Published Wed, Aug 26 2009 9:07 AM by Calculated Risk Blog
    I've seen after today suggesting the bottom is in for house prices. This isn't like 2005 when it was almost certain that prices would fall, and fall sharply. Now we are much closer to the bottom than to the top in prices (for some metrics, see ) In some areas prices have probably already hit bottom - like some non-bubble areas, and some bubble areas with significant foreclosure activity. But I think many areas, especially the mid-to-high priced bubble areas, there will be further price declines. I'm not as certain as I was in 2005, but I think these price declines will drag down the Case-Shiller indexes - and I don't think the price bottom is in. I do not have a crystal ball, but ... It seems there are many more foreclosures coming. Some of this depends on the success of the modification programs, but the shows a growing number of homeowners in the problem pipeline. And the yesterday suggests few of these delinquent homeowners will cure. That seems to mean rising foreclosures, and more distressed inventory. The MBA Chief Economist Jay Brinkmann thinks foreclosures will peak at the end of 2010. Historically prices bottom about the same time as foreclosure activity peaks. Maybe it will be different this time - maybe the modification programs will significantly reduce foreclosures - maybe prices will bottom before foreclosures peak ... but I'll go with the normal pattern. And on the demand side, there has been a surge in first-time homebuyer activity. There was significant pent up demand from potential first-time buyers who were priced out of the market in 2004-2006, and then were afraid to buy as prices fell. But demand from these buyers will probably wane later this year, even if another tax credit is enacted. Just like the "cash-for-clunkers" demand declined after the initial burst. For mid-to-high priced homes, there are few move-up buyers (or so it would seem since so many low end homes were distress sales). Right now the months-of-supply...
    Click Here to Read the Full Article

    Source: Calculated Risk Blog
  • 9:06 AM » Will Mortgage Insurers Limit the Housing Market?
    Published Wed, Aug 26 2009 9:06 AM by Calculated Risk Blog
    From Matt Padilla at the O.C. Register: Matt quotes an article from the : The GSEs can purchase single-family mortgages with loan-to-value ratios higher than 80% only if the homebuyer gets mortgage insurance. The FHFA Mortgage Market Note issued a few days after Mr. Lockhart’s departure projects that the demand for such high LTV loans could hit $230 billion in 2009. The ability of the MIs to meet that level of demand is “remote,” FHFA report says. “The industry’s ability to build and maintain sufficient capital to meet the needs of the enterprises over the short term without some federal assistance or an infusion of private capital is unclear,” the report concludes. emphasis added Another goverment program? By request the Feed is Full length and Free of ads. And also by request , once a month, here is a tip jar - to leave a tip. Thanks! CR
    Click Here to Read the Full Article

    Source: Calculated Risk Blog
  • 9:05 AM » Misc: A possible 1991 House Price Headline, and Falling Rents in NYC
    Published Wed, Aug 26 2009 9:05 AM by Calculated Risk Blog
    Imagine a headline in June 1991 (if Case-Shiller was around): "House Prices increase at 11.6% annualized rate in June!" The horrible price declines were over ... right? Nope. Real house prices declined for almost another 5 years. Just something to remember. From Bloomberg: In buildings attended by doormen, rents on one-bedroom apartments dropped 10 percent from a year earlier to an average of $3,274 a month, according to a report by the Real Estate Group of New York. Studio prices fell 7 percent at those properties to $2,329 and two-bedrooms declined almost 6.9 percent to $5,161. Falling rents means a further decline in house prices to lower the . And a market graph from . This matches up the market bottoms for four crashes (with an interim bottom for the Great Depression). Note that the Great Depression crash is based on the DOW; the three others are for the S&P 500. By request the Feed is Full length and Free of ads. And also by request , once a month, here is a tip jar - to leave a tip. Thanks! CR
    Click Here to Read the Full Article

    Source: Calculated Risk Blog
  • 9:04 AM » Is Housing Back?
    Published Wed, Aug 26 2009 9:04 AM by Seeking Alpha
    submits: From : Prices of U.S. single-family homes rose for the second consecutive month in June, exceeding expectations and adding to evidence that the three-year housing slump is easing, Standard & Poor's reported on Tuesday.
    Click Here to Read the Full Article

    Source: Seeking Alpha
  • 9:03 AM » Time to Change GSEs' Deal with Treasury
    Published Wed, Aug 26 2009 9:03 AM by Seeking Alpha
    submits: Given Freddie Mac’s () recently reported profitable second quarter earnings, it is time for Treasury Secretary Geithner to amend the terms of Fannie Mae () and Freddie Mac’s Senior Preferred Stock Purchase Plan with the Treasury to be comparable to the preferred stock purchases the Treasury made in commercial banks last October under TARP. Reasons to Change Fannie and Freddie’s Deal with the Treasury Fannie and Freddie should not have a materially worse deal than the banks just because their deal was cut four weeks before TARP. Fannie and Freddie are critical to the domestic economy as they have been the only source of mortgage capital for the past 12 months. The mortgage market will need private capital in the future and cannot rely on government support forever, so Fannie and Freddie will have to raise more capital in the future. If the GSEs are going to raise capital in the future, the Treasury is going to have to treat existing capital better than its current deal with the GSEs. Fannie and Freddie incurred higher expenses because they were team players and supported the Obama Administration’s economic recovery plan. Changing their deal would be a small payback for the support they have given the country and the Administration. Recognition that placing the GSEs in conservatorship was a political attack by led by former Treasury Secretary Paulson and Fed Governor Kevin “Hey, Brah” Warsh. Recognition that former Treasury Secretary Paulson caused a decline in the GSEs stock prices by not outlining the terms under which he would provide capital to the GSEs in the July 2008 legislation. Sec. Paulson then used circular reasoning in claiming that the GSEs had to be taken over because they had low stock prices and couldn’t raise capital. In fact, they couldn’t raise capital because he would not state the terms of a potential future Treasury investment. Paulson’s reasoning for the harsh treatment of GSE shareholders was that shareholders had to pay for the poor risks...
    Click Here to Read the Full Article

    Source: Seeking Alpha
  • 9:03 AM » El-Erian: Bernanke’s Four Point ‘To-Do’ List
    Published Wed, Aug 26 2009 9:03 AM by
    Bernanke has played a major role in designing and implementing policies that averted an even larger global destruction of jobs and living standards around the world. Indeed, crisis management has defined Bernanke’s first term. His second term promises to be equally challenging as it will be defined by four major issues.
    Click Here to Read the Full Article

  • 9:02 AM » Fannie and Freddie Shares Soar Though Value in Question
    Published Wed, Aug 26 2009 9:02 AM by Seeking Alpha
    submits: It’s very hard to come up with scenarios where they’re worth any money. There’s a tremendous amount of sentiment trading in general. - , Analyst, Keefe, Bruyette & Woods
    Click Here to Read the Full Article

    Source: Seeking Alpha
  • 9:01 AM » Small Bank, Big Bank: The Difference Is Real Estate Exposure
    Published Wed, Aug 26 2009 9:01 AM by Seeking Alpha
    As a follow-up to our on failures of small banks, here is an interesting fact: small banks had significantly higher exposure to real estate than large banks. There is a general misconception out there that the large banking institutions have been responsible this financial crisis by taking excessive risks, while the "main street" banks have been relatively prudent. This assumption turns out to be completely wrong.
    Click Here to Read the Full Article

    Source: Seeking Alpha
  • 9:00 AM » Housing Litmus Test: Are Things Improving?
    Published Wed, Aug 26 2009 9:00 AM by Seeking Alpha
    The July housing data could be caused by a recovering economy or it could be just something caused by the government incentive for first-time home buyers. I’m betting that it was caused by the government incentives for first-time homebuyers for two reasons: first, sales of low-end houses are the only area that is increasing; and second, just about all of my kid’s friends who hadn’t owned a house before have bought one. Sales on low-end houses have been very good in the Cleveland area where I’m based.
    Click Here to Read the Full Article

    Source: Seeking Alpha
  • 8:59 AM » Wells Fargo Slow to Consolidate Wachovia into Its System
    Published Wed, Aug 26 2009 8:59 AM by Seeking Alpha
    submits: Six months after acquiring Wachovia Corp., the Wells Fargo () name and stagecoach logo have yet to be seen in the Kansas City area. Indeed it will not be visible till the next year. San Francisco-based Wells Fargo has been moving slowly to consolidate Wachovia Bank into its system. During December last year, the brokerage firm Wachovia Securities became part of Wells Fargo. All 4,800 branches of the residential lender Wachovia Mortgage have been folded into Wells Fargo Home Mortgage.
    Click Here to Read the Full Article

    Source: Seeking Alpha
  • 8:59 AM » 34 Percent of Workers Have One Week or Less of Savings
    Published Wed, Aug 26 2009 8:59 AM by Google News
    Many people are living paycheck to paycheck, on the edge of disaster as highlighted in a new Monster Poll that reveals . Over a one week period beginning July 6 and running through July 13, more than 16,000 visitors to participated in the Monster Meter Poll question “If you were laid off without severance, how long would your savings cover your living expenses?” One Week or Less: 34% 2-4 Weeks: 16% 1-2 Months: 16% 3-5 Months: 14% 6 Months or Longer: 20% Creating three broad groups, 50% have less than a month of savings, while only 20% have 6 months or more. The remaining 30% are in between. Although the Monster Poll is not scientific, I cannot help thinking it is reasonably accurate. The implications on the savings rate are obvious: It will continue to rise. Those out of work may wish to consider Monster's that contains a few worthwhile albeit mostly obvious tips for people to follow. Monster's was disappointing. The odds of success even in good times are not very high, something the article failed to address. Certainly the odds of success in starting a business right now are much worse than in normal times. And for those down to their last few months of cash, the odds of success approach zero unless one has the proverbial rich uncle willing to provide cash for a large number of years. Banks certainly are not lending to startups with no cash. Heck, banks are tightening lending standards even for those who do have significant skin in the game. Charts Show Grim Employment Stats The jobs picture is grim, unemployment is likely to rise through 2010, and up to 1.5 million workers are expected to lose unemployment benefits by the end of the year. For a discussion and some interesting chart on expiring benefits, please see . I expect unemployment benefits will be extended a third time, but living on unemployment benefits is far different than living on a normal paycheck. Moreover, many jobs are gone and will never come back. Few are prepared for that grim...
  • 8:59 AM » Evaluating Valuation
    Published Wed, Aug 26 2009 8:59 AM by
    Yesterday, Rishy wrote an interesting article about Hedonic Pricing models, and the urge to refine them in the face of a tumultuous market that leaves it very difficult to price assets. But, to determine value, whether components or aggregate, one must first look more closely at what “value” means. The three most common definitions, per [...]
  • Tue, Aug 25 2009
  • 4:59 PM » Case-Shiller House Prices and Stress Test Scenarios
    Published Tue, Aug 25 2009 4:59 PM by Calculated Risk Blog
    This following graph compares the Case-Shiller Composite 10 SA index with the Stress Test scenarios from the Treasury (stress test data is estimated from quarterly forecasts). The Stress Test scenarios use the Composite 10 index and start in December. Here are the numbers: Case-Shiller Composite 10 Index, June: 152.55 Stress Test Baseline Scenario, June: 148.82 Stress Test More Adverse Scenario, June: 140.71 Unlike with the unemployment rate (worse than both scenarios), house prices are performing better (from the perspective of the banks) than the the stress test scenarios. I believe there will be further price declines later this year, because I think the Case-Shiller seasonal adjustment is insufficient, and because I expect the first-time home buyer frenzy to slow just as more distressed supply comes on the market - even if an extension to the tax credit is passed.
    Click Here to Read the Full Article

    Source: Calculated Risk Blog
  • 2:53 PM » Demand Grows for Affordable Senior Housing
    Published Tue, Aug 25 2009 2:53 PM by Realtor.Org
    With rising costs of health care and food, more people 65 and older are in need of economical housing.
  • 12:51 PM » Citi's Initiatives Helping Prevent Foreclosures
    Published Tue, Aug 25 2009 12:51 PM by Seeking Alpha
    submits: Citigroup Inc.’s () initiatives in the U.S. to keep distressed borrowers in their homes have paid off. The loss-mitigation successes have outnumbered foreclosures completed by a ratio of more than 12 to 1 in the second quarter, compared with 6 to 1 reported six months ago. Around 108,000 U.S. homeowners were helped by Citigroup to avoid potential foreclosures on loans totaling more than $16 billion. This was 30% higher then the prior quarter.
    Click Here to Read the Full Article

    Source: Seeking Alpha
  • 12:50 PM » Housing Rebound Looks Good For Now, But Will It Last?
    Published Tue, Aug 25 2009 12:50 PM by CNBC
    Recent increases in housing prices are encouraging signs that the market is rebounding, but there remains a strong level of caution about whether the recovery is real.
  • 12:49 PM » White House Sees Deeper Deficit
    Published Tue, Aug 25 2009 12:49 PM by WSJ
    The Obama administration raised the estimate for the 10-year deficit to $9 trillion -- $2 trillion more than forecast. The White House foresees unemployment hitting 10% over the next year and a half.
  • 12:49 PM » Philly Fed State Coincident Indicators: Still a Widespread Recession in July
    Published Tue, Aug 25 2009 12:49 PM by Calculated Risk Blog
    Click on map for larger image. Here is a map of the three month change in the Philly Fed state coincident indicators. Forty six states are showing declining three month activity. This is what a widespread recession looks like based on the Philly Fed states indexes. On a one month basis, activity decreased in 35 states in June, and was unchanged in 8 states. Here is the Philadelphia Fed state coincident index for July. The Federal Reserve Bank of Philadelphia has released the coincident indexes for the 50 states for July 2009. In the past month, the indexes increased in seven states (Louisiana, Mississippi, North Dakota, South Carolina, South Dakota, Vermont, and Wisconsin), decreased in 35, and remained unchanged in eight (Hawaii, Indiana, Nebraska, New Jersey, Oklahoma, Rhode Island, Tennessee, and Virginia) for a one-month diffusion index of -56. Over the past three months, the indexes increased in three states (Mississippi, North Dakota, and Vermont), decreased in 46, and remained unchanged in one (South Carolina) for a three-month diffusion index of -86. The second graph is of the monthly Philly Fed data of the number of states with one month increasing activity. Most of the U.S. was has been in recession since December 2007 based on this indicator. Note: this graph includes states with minor increases (the Philly Fed lists as unchanged). A large percentage of states showed declining activity in July. Still a widespread recession in July by this indicator ...
    Click Here to Read the Full Article

    Source: Calculated Risk Blog
  • 12:49 PM » Seasonality of Home Prices
    Published Tue, Aug 25 2009 12:49 PM by The Big Picture
    To highlight the seasonality of housing and its impact on pricing where the spring is the busiest of the year, the S&P/Case Shiller Index, which does not seasonally adjust its m/o/m pricing, has shown its best performance in Q2 in every year except one going back to ‘01. ‘09 is of course not complete but Q2 saw a gain of 1.3% after a drop of 7% in Q1. On the downside in ‘07 and ‘08, Q2 saw the smallest decline and in the boom years in ‘04, ‘05 and ‘06, Q2 saw the biggest rise. In ‘03, Q3 price gains barely exceeded the Q2 rise while in ‘01 and ‘02, Q2 had the best price increases. The price data seen is welcome relief but it’s that time of the year and the $8000 tax credit and slowing foreclosure rate had its impact. Add to this the still punk Present Situations component in Confidence and it helps to explain again, the lack of belief in the sustainability of recovery that the bond market has relative to stocks.
    Click Here to Read the Full Article

    Source: The Big Picture
  • 10:22 AM » Court Orders Federal Reserve to Disclose Emergency Loan Details
    Published Tue, Aug 25 2009 10:22 AM by Bloomberg
    The Federal Reserve must for the first time identify the companies in its emergency lending programs after losing a Freedom of Information Act lawsuit.
  • 10:18 AM » New York Fed Launches Credit Conditions Section of Website
    Published Tue, Aug 25 2009 10:18 AM by NY Fed
    The Federal Reserve Bank of New York today launched an expanded section of its website, adding new regional information on consumer credit conditions intended to assist policymakers address mortgage delinquency and foreclosure issues. The U.S. Credit Conditions section offers new interactive maps and data on auto and student loan delinquencies, and mortgage “roll” rates. These features complement existing maps and spreadsheets on mortgage foreclosures and delinquencies, measures of subprime and alt-A mortgages and bank credit card delinquencies. The data are available at the state and county level.
  • 9:19 AM » Press Release: Bernanke On His Reappointment
    Published Tue, Aug 25 2009 9:19 AM by Federal Reserve
    I would like to express my gratitude to President Obama for the confidence he has shown in me with this nomination and for his unwavering support for a strong and independent Federal Reserve. It has been a particular privilege for me to serve with extraordinary colleagues throughout the Federal Reserve System. They have demonstrated remarkable resourcefulness, dedication, and stamina under trying conditions. Through the long nights and weekends and the time away from their families, they have never lost sight of the critical importance of the work of the Fed for the economic well-being of all Americans. I am deeply grateful for their efforts.
    Click Here to Read the Full Article

    Source: Federal Reserve
  • 9:05 AM » Press Release: S&P/Case Shiller Home Price Index
    Published Tue, Aug 25 2009 9:05 AM by
    Data through June 2009, released today by Standard & Poor’s for its S&P/Case-Shiller1 Home Price Indices, the leading measure of U.S. home prices, show that the U.S. National Home Price Index improved in the second quarter of 2009.
    Click Here to Read the Full Article

  • 7:48 AM » Citi Says Loan Modifications Growing Substantially
    Published Tue, Aug 25 2009 7:48 AM by Reuters
    Citigroup Inc ( C.N ) has "substantially" boosted its mortgage modification offers this month in response to the U.S. Treasury's call to speed the process and help prevent foreclosures, the bank's top mortgage executive said.
  • 7:28 AM » Banks to Raise more Tier 1 Capital
    Published Tue, Aug 25 2009 7:28 AM by Calculated Risk Blog
    Some people knew this was coming ... From Reuters: Deutsche Bank AG plans to raise new Tier 1 debt ... as banks seek to rebuild balance sheets in the wake of the financial crisis. The German bank confirmed it planned to issue euro fixed-rate perpetual notes, with annual call dates beginning from March 2015, and said it was managing the issue. ... the first of an expected series of new Tier 1 notes to hit the market in coming months from banks ... The deal would be smaller than 1 billion euros as the bank was seeking to test the market's appetite ... And SunTrust hints at raising new capital, from Bloomberg: “The industry is a long way from declaring any sort of victory, especially regarding credit issues,” Chief Executive Officer James Wells III said today in a speech to the Rotary Club of Atlanta. “This credit cycle has yet to play itself out. We do not expect things to improve for the banking industry in the very near future.” ... “The industry has moved from a potentially cataclysmic scenario to one that is merely very difficult,” Wells said. “The industry is back from the brink of a potential global financial-system meltdown.” ... “ Even if the economy begins to improve modestly, commercial real estate conditions will probably deteriorate until 2010 .” ... Wells said SunTrust may repurchase $4.9 billion in preferred shares sold through the U.S. Troubled Asset Relief Program “as soon as possible,” without being more specific. Ahhh ... just prudent balance sheet management!
    Click Here to Read the Full Article

    Source: Calculated Risk Blog
  • 7:27 AM » NY Fed: US Credit Conditions Map
    Published Tue, Aug 25 2009 7:27 AM by NY Fed
    The Federal Reserve considers the record rate of mortgage delinquencies, foreclosures and their impacts on communities an urgent problem.
  • 7:26 AM » Bernanke Wins Reappointment
    Published Tue, Aug 25 2009 7:26 AM by The Big Picture
    The majors all have the story that Ben will be reappointed by Obama: Obama will make the announcement tomorrow on Martha’s Vineyard, Massachusetts, where he is vacationing with his family, and Bernanke is expected to join him, said the official, who spoke on the condition of anonymity. The nomination requires Senate approval. Bernanke’s four-year term as chairman expires Jan. 31 Game theory would have it this is the safe pic, the one that you cannot get into trouble for, even if things go bad later. A new Fed Chair, in the event something went awry down the road would lead bame back to the White House. See also • (Bloomberg) • (WSJ) • (NYT)
    Click Here to Read the Full Article

    Source: The Big Picture
  • 7:25 AM » Bank Holding Companies Ranked by Commercial Real Estate Loans
    Published Tue, Aug 25 2009 7:25 AM by The Big Picture
    > Note: The full text of the table (150 banks in total) is after the jump > Bank Holding Companies Ranked by Commercial Real Estate Loans On March 31, 2009. Dollars in thousands Published August 18, 2009 Rank Commercial real estate loans Total loans and leases March 31 Year earlier Change 1 Wells Fargo & Co. San Francisco $88,433,000 $33,679,000 162.6% $888,722,000 2 Bank of America Corp. Charlotte 59,066,694 55,775,746 5.9 1,024,002,160 3 MetLife Inc. New York 32,519,404 32,189,604 1.0 66,740,934 4 JPMorgan Chase & Co. New York 23,659,000 13,802,000 71.4 722,647,000 5 PNC Financial Services Group Inc. Pittsburgh 22,020,406 9,716,556 126.6 175,475,742 6 U.S. Bancorp Minneapolis 19,862,000 16,546,000 20.0 188,829,000 7 Regions Financial Corp. Birmingham, Ala. 19,562,015 16,336,617 19.7 97,749,387 8 BB&T Corp. Winston-Salem, N.C. 17,187,805 13,639,372 26.0 100,239,388 9 TD Banknorth Inc. Portland, Maine 15,203,197 12,801,823 18.8 52,172,920 10 Zions Bancorp. Salt Lake City 14,173,532 11,897,800 19.1 42,237,449 11 SunTrust Banks Inc. Atlanta 13,886,140 12,018,678 15.5 130,847,004 12 Citigroup Inc. New York 12,875,000 8,840,000 45.6 685,584,000 13 M&T Bank Corp. Buffalo 12,071,925 11,480,180 5.2 48,918,140 14 Citizens Financial Group Inc. Providence, R.I. 11,601,365 11,176,389 3.8 108,962,255 15 Comerica Inc. Dallas 10,951,030 12,265,742 -10.7 48,660,019 16 Capital One Financial Corp. McLean, Va. 10,869,821 10,154,265 7.0 106,440,042 17 KeyCorp Cleveland 10,634,314 10,455,567 1.7 74,827,408 18 Fifth Third Bancorp Cincinnati 10,326,300 10,248,758 0.8 85,168,149 19 Marshall & Ilsley Corp. Milwaukee 8,767,444 7,769,315 12.8 49,244,654 20 BancWest Corp. San Francisco 8,399,800 7,640,680 9.9 54,938,942 21 Barclays Group US Inc. Wilmington, Del. 8,046,628 11,218,930 -28.3 23,914,672 22 Synovus Financial Corp. Columbus, Ga. 7,718,504 6,742,728 14.5 27,976,115 23 Huntington Bancshares Inc. Columbus, Ohio 7,633,475 7,827,739 -2.5 40,013,009 24 Popular Inc...
    Click Here to Read the Full Article

    Source: The Big Picture
  • 7:24 AM » How Small Bank Failures Are a Boon for Big Banks
    Published Tue, Aug 25 2009 7:24 AM by Seeking Alpha
    submits: In the past week, two prominent analysts have said they expect hundreds more small bank failures in the second half of this year. At the same time, the Financial Select Sector SPDR ETF () , a fund that tracks top U.S. banking institutions, has risen to a year-to-date high. But at what point will the number of regional bank bankruptcies drag on the performance of the bulge bracket institutions? The answer may be never. More unfortunately still, judging by the numbers, it seems that small bank failures are actually propelling both earnings and investor appetite for the big banks.
    Click Here to Read the Full Article

    Source: Seeking Alpha
  • 7:23 AM » S&P Expects Further Downgrades of U.S. Regional Banks
    Published Tue, Aug 25 2009 7:23 AM by Seeking Alpha
    submits: Standard & Poor’s said in its second quarter that it expects more downgrades of US regional banks: Banks’ announced or completed capital actions partially offset our views that credit quality will deteriorate and that net losses will persist throughout 2010. Nevertheless, the vast majority of the large regional banks we rate have negative outlooks, reflecting our view that more downgrades may come in the near-to-intermediate term.
    Click Here to Read the Full Article

    Source: Seeking Alpha
  • 7:23 AM » Structured Finance Impairment Rates to Stay High in 2009
    Published Tue, Aug 25 2009 7:23 AM by Seeking Alpha
    submits: Moody’s has issued its seventh annual report of the material impairment and loss rates of global structured finance securities, covering the credit performance through year-end 2008 of all structured finance securities issued since 1993. One startling statistic: the total number of 12,666 newly impaired tranches in 2008 is almost four times the total of 3,346 for the previous 14 years combined.
    Click Here to Read the Full Article

    Source: Seeking Alpha
  • 7:23 AM » Economists React: Bernanke Reappointment Is ‘Good News’
    Published Tue, Aug 25 2009 7:23 AM by WSJ
    Economists, lawmakers, bloggers and others weigh in on . While I have had serious differences with the Federal Reserve over the past few years, I think reappointing Chairman Bernanke is probably the right choice. Chairman Bernanke was too slow to act during the early stages of the foreclosure crisis, but he ultimately demonstrated effective leadership and his reappointment sends the right signal to the markets. –Sen. Chris Dodd, (D., Conn.), Chairman Senate Banking Committee The experience that Bernanke has acquired will be invaluable. I don’t mean this to sound like a back-handed compliment, but Bernanke is not the same person today as the one who made the decisions that his critics object to. –Louis Crandall, Wrightson ICAP I think it’s good news for the Federal Reserve. It’s good news for the country. It’s a great choice. Chairman Bernanke has done a terrific job in bringing openness to the Fed. He has been bold and creative in dealing with the financial crisis… It was not clear to most people that the crisis was going to be as broad-based, and that the excesses in the financial markets and in lending were as broadly based as they turned out to be. Even at the start, he was willing to consider all options to deal with what appeared to be more a liquidity than a solvency crisis. As it began to become more clear that it was a crisis of solvency and leverage and a classic credit crunch, he didn’t flinch in bringing enormous creativity to bear in mitigating the problem –Richard Berner, Morgan Stanley Having a new chairman come in at this late date would put the Fed engineered solution to both the recovery and the exit strategy at risk. The Federal Reserve made a hasty exit from easy money stimulus in the 1930s and we know how that worked out… Mistakes have been made at many regulatory institutions during this crisis, but all the Fed’s mistakes would have been made by any man according to the prudent man rule. Bernanke is a true prudent man who calls them as he sees them...
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