Thursday, December 27, 2012

Friday December 28 Housing and Economic stories


TOP STORIES:

California Psychiatrists Paid $400,000 Shows Bidding War - (www.bloomberg.com) Mohammad Safi, a graduate of a medical school in Afghanistan, began working as a psychiatrist at a California mental hospital in 2006, making $90,682 in his first six months. Last year, he took home $822,302, all of it paid by taxpayers. Safi benefited from what amounted to a bidding war after a federal court forced the state to improve inmate care. The prisons raised pay to lure psychiatrists, the mental health department followed suit to keep employees, and costs soared. Last year, 16 California psychiatrists, including Safi, made more than $400,000, while only one did in the other 11 most populous states, according to data compiled by Bloomberg.

Spanish Repossessed Property Prices Tumble 65% in Credit Crunch - (www.bloomberg.com) Prices of repossessed Spanish homes offloaded by lenders this year tumbled 65 percent as a million new properties remain unsold and buyers find it more difficult to get mortgages, according to Fitch Ratings. The price decline is relative to the value of the property when the loans were made and is more than double the drop in real estate values recorded in government data. That compares with a 45 percent slump in Portuguese repossessed house values. Spain’s property market is hampered by the country falling into its second recession in three years and struggling with Europe’s highest unemployment rate of 25 percent. Fitch published its latest study five years after a decade-long real estate bubble burst and just as Spain sets up its so-called bad bank to purge toxic assets from the books of troubled lenders.

Fed Expands Asset Buying, Links Rates to Joblessness, Prices - (www.bloomberg.com) The Federal Reserve said it will buy $45 billion a month of Treasury securities starting in January, expanding its asset-purchase program, and it linked the outlook for its main interest rate to unemployment and inflation. “The committee remains concerned that, without sufficient policy accommodation, economic growth might not be strong enough to generate sustained improvement in labor-market conditions,” the Federal Open Market Committee said today at the conclusion of a two-day meeting in Washington. The Fed said interest rates will stay low “at least as long” as the unemployment rate remains above 6.5 percent and if inflation “between one and two years ahead” is projected to be no more than 2.5 percent. The committee “views these thresholds as consistent with its earlier date-based guidance.”

NFIB small-business optimism index plunges - (www.marketwatch.com)  Small-business optimism plunged in November in the wake of President Barack Obama's re-election, according to data released Tuesday. An index from the National Federation of Independent Business that tracks sentiment among small firms fell 5.6 points at 87.5. The survey found that 49% of small-business owners expect future business conditions to be worse than current conditions. In October, a record percentage of owners were uncertain about the outlook, and it appears that many became decidedly negative in November. "Washington does not have the needs of small business in mind, said NFIB chief economist Bill Dunkelberg.

Head of GSEs Edward DeMarco faces replacement, unfortunately  - (www.ochousingnews.com)  Edward DeMarco is a thorn in the side of the Obama administration. He has consistently resisted calls to pander to loan-owners by forgiving principal on GSE loans. Many on the political left are calling for his head, and the Obama administration is poised to oblige them — and that’s not appropriate. DeMarco has proven to be a thoughtful administrator who protects the interests of the US taxpayer. Of course, that’s the problem many politicians have with him. They want to raid the coffers of the treasure to buy more votes. If DeMarco is replaced by someone who will allow politicians to steal from the treasury to buy votes, it would be a travesty. Unfortunately, I am not hopeful that Conservatives have the will or the power to stop them. This is one more step toward becoming a banana republic.






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