Wednesday August 20, 2008

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Subprime News

• Freddie To Stop Buying New York State Subprime Mortgages
  In their latest effort to deal with the mortgage mess Freddie Mac will stop purchasing subprime mortgages out of New York.


• Could FDIC also be a |DQuote|Predatory lender?|DQuote|
  Lawsuit by Texas bank alleges that FDIC knowingly sold loans that were originated by a failed bank in violation of predatory-lending practices.


• Scotiabank Says Measures Will Not Prevent U.S. Economic Slowdown
  According to Scotiabank|SQuote|s Global Outlook released Monday, sharp monetary policy easing, a generous fiscal stimulus package and massive liquidity injections are not sufficient to ward off a deterioration in U.S. economic conditions as the subprime crisis continues to take its toll on the economy and government spending soars to unprecedented levels.


• Fed|SQuote|s Kroszner Says Fed Rules Will Affect Subprime and Alternative Mortgages
  Delivering comments at the FDIC|SQuote|s Minority Depository Institutions National Conference in Chicago, Fed Governor Randall Kroszner said the Fed|SQuote|s new rules on mortgages would alleviate pressures in nearly the entire subprime sector and some other alternative mortgage markets.


• Is Any Company Safe from Subprime Related Lawsuits?
  Insurance and legal experts argue over whether any company will be untouched by shareholder lawsuits arising out of the subprime crisis.


• U.S. Treasury|SQuote|s Steel Calls for More Financial Education
  Increased financial literacy from consumers would have helped dampen some of the effects of the subprime housing crisis, according to Robert K. Steel, U.S. undersecretary for domestic finance, on Wednesday.


• Fed|SQuote|s Lockhart Sees Fragile Credit Conditions in U.S.
  Head of the Atlanta Federal Reserve, Dennis Lockhart, said credit markets remain fragile given a loss of confidence from the subprime crisis.


• New Fannie Mae Program May Benefit 150,000 Homeowners
  Fannie Mae offers new program to refinance borrowers with no equity, even negative equity in their homes.


• Doubting the Viability of Fannie Mae
  Two more quarterly losses announced by major mortgage market players as some begin to doubt viability of Fannie Mae.


• Task Force May Widen Federal and State Investigation into Mortgage Irregularities
  Large bank write-downs spur increased activity as feds and others investigate mortgage and securities fraud.


• Another Loss for Countrywide as Bank of America Plans for Future
  Countrywide Financial records its third consecutive quarterly loss and its new owner announces plans to modify thousands of its delinquent loans.


• Wachovia Announces Losses and Capital Acquisition
  Wachovia becomes latest loser in subprime mess; plans to raise funds through stock sales.


• WaMu Job Cuts, Closings and Wholesale Shutdown
  Washington Mutual gets $7 billion in cash from sale of stock to a private equity firm and plans job cuts/closings.


• IMF Says Total Losses from Financial Turmoil Could Reach $945 Billion
  According to a report released by the International Monetary Fund (IMF) on Tuesday morning, total losses from the subprime meltdown could reach up to $945 billion on the back of fears of a deeper, more protracted crisis.


• Plenty More Subprime Fallout to Come, Says CIBC|SQuote|s Rubin
  Losses from the U.S. subprime mortgage meltdown could top $300 billion. |DQuote|We|SQuote|re about 55-60% of the way through the subprime fallout.|DQuote|


• New York Fed to Provide Nationwide U.S. Subprime, Alt-A Loan Data
  he Federal Reserve announced Tuesday that it will provide a set of maps and data illustrating subprime and alt-A mortgage loan conditions across the U.S.


• Lehman Brothers Stock Sale Sends Market Surging; UBS Still Writing Down
  Lehman Brothers raises |DQuote|confidence capital|DQuote| while UBS announces further U.S. related losses.


• Subprime Lawsuits Already Outpacing S&L Litigation
  While the financial markets are bleeding the lawyers are lining up.


• Project Lifeline to Cover Nearly All Borrowers
  Hope NOW alliance|SQuote|s Project Lifeline expands to cover nearly entire mortgage market.


• Delinquent Homeowners Get a New |DQuote|Lifeline|DQuote|
  Six major servicers announce another program to help homeowners avoid foreclosure. This one has much greater reach (and probably utility) than the rate freeze announced in December.


• Countrywide CEO Waives Massive Severance Package
  Will turning down over $37 million quiet the controversy over Countrywide Financials CEO?


• Can Saving PMI Also Save the Economy? Cramer Thinks So
  Jim Cramer proposes an expensive pre-emptive bail out of credit insurers. Would it be enough to stave off a recession or maybe even a disaster?


• MBA Touts Role in Helping Mortgage Borrowers
  MBA report indicates that lenders are being proactive in attempting to resolve mortgage delinquencies and expects that efforts will increase with the advent of the HopeNOW Alliance.


• Merrill Lynch Losses Near Top of Analysts Estimates
  As expected, Merrill Lynch announces stunning losses and write-downs in fourth quarter as subprime losses mount.


• Citigroup Announces Unprecidented Losses; Dividend Cut
  Citigroup writes off huge losses and cuts dividends while Merrill Lynch is due to announce horrible results on Thursday. Both banks are reporting big cash infusions from Asian and Middle Eastern investors.


• National City Job Cuts
  Another big bank announces staff and dividend cuts. Subprime losses may even be threatening hygiene.


• New Home Sales Drop Again But Prices Fairly Stable
  Builders are holding big inventories of unsold houses as new house sales continue to fade.


• ARM Freeze Yields Solution To All World Problems
  Contributor Donna Robinson gives her view on the recent ARM Rate Freeze announcement.


• Housing Starts, Permits Fall Again But Builder Confidence Stabilizes
  Housing starts and permits hit 16 year low in latest Census/HUD report while NAHB sees builder|SQuote|s confidence as mixed.


• Washington Mutual Announces Major Layoffs and Closings
  Washington Mutual announced massive layoffs and office closings while it seeks to both raise and save a lot of cash.