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America has 40 million McMansions that no one wants - (www.utsandiego.com) America has too many big houses -- 40 million, to be exact -- because
consumers are shifting preferences to condos, apartments and small homes,
experts told the New Partners for Smart GrowthThursday,
holding its 11th annual conference in San Diego through Sunday. Relying on
developers' surveys, Chris Nelson, who heads theMetropolitan Research Centerat the University of Utah, said
43 percent of Americans prefer traditional big, suburban homes but the rest
don't. "That means we are out of balance in terms of where the market is
right now, let alone trending toward the future," he said.
Greece Warns of Going Broke as Tax Proceeds Dry Up - (www.nytimes.com) As European
leaders grapple with how to preserve their monetary union, Greece is rapidly
running out of money. Government coffers could be empty as soon as July,
shortly after this month’s pivotal elections. In the worst case, Athens might
have to temporarily stop paying for salaries and pensions, along with imports
of fuel, food and pharmaceuticals. Officials, scrambling for solutions, have
considered dipping into funds that are supposed to be for Greece’s troubled
banks. Some are even suggesting doling out i.o.u.’s. Greek leaders said that
despite their latest bailout of 130 billion euros, or $161.7 billion, they face
a shortfall of 1.7 billion euros because tax revenue and other sources of
potential income are drying up.
Spain admits it can no longer raise money on the global markets
- (www.telegraph.co.uk) Spain has admitted for the first time that it can no longer raise money
on the global markets or roll over its sovereign bonds, threatening to set off
a dangerous escalation of Europe's debt crisis. Premier Mariano Rajoy said the
country is "in an extremely difficult situation" and called on Europe
to stand by the mutual obligations of euro membership. "Europe must say
where it is going and show that the euro is an irreversible project that is not
in danger, that helps nations in difficulty," he told Spain's senate. Treasury
minister Cristobal Montoro confessed that Spain can no longer raise money.
"The market is no longer open. The risk premium is telling us that Spain
as a state has a problem accessing the market when we need to refinance our
debt."
Mortgage fraud fraud - (www.nytimes.com)
I got an
e-mail the other day from Richard Engle telling me that his son Charlie would
be getting out of prison this month. I was happy to hear it. Charlie’s ordeal
isn’t over yet, of course. When he leaves prison on June 20, Charlie, 49, will
move temporarily to a halfway house, after which he will be on probation for
another five years. And unless he can get the verdict overturned, he will have
to spend the rest of his life with a felony on his record. Perhaps you remember
Charlie Engle. I
wrote about him not long after he entered a minimum-security
facility in Beaver, W.Va., 16 months ago. He’s the poor guy who went to jail
for lying on a liar loan during the housing bubble. There were two things about
Charlie’s prosecution that really bothered me. First, he’d clearly been
targeted by an agent of the Internal Revenue Service who seemed offended that
Charlie was an ultramarathoner without a steady day job. The I.R.S. conducted
“Dumpster dives” into his garbage and put a wire on a female undercover agent
hoping to find some dirt on him. Unable to unearth any wrongdoing on his tax
returns, the I.R.S. discovered he had taken out several subprime mortgages that
didn’t require income verification. His income on one of them was wildly
inflated. They don’t call them liar loans for nothing.
The UK is praying Spain sorts out its banking crisis - (www.telegraph.co.uk) As the Spanish banking crisis grows yet deeper, Philip Aldrick examines
the burgeoning threat and the potential impact of a eurozone-funded bank
rescue. There was an eerie calm about the plight of Spain at the International
Monetary Fund’s spring meetings in mid-April. The country’s borrowing costs may
have been inching perilously higher on news that Spanish banks had tapped the
European Central Bank for around €200bn (£160bn) of a €530bn round of emergency
funding, but officials gathered in the warm Washington sunshine were confident
that Madrid would soon win back the markets.
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