KeNo's Housing and Economic Portal: Thursday March 5 Housing and Economic stories

TOP STORIES:

Why Lenders Love the $2.5 Million Home Loan - (www.bloomberg.com) It’s shaping up as the year of the mega mortgage. Home loans from $1 million to $5 million were the fastest growing part of the jumbo market in January, according to purchase application data from the Mortgage Bankers Association. Wealthy borrowers are seeking even bigger loans this year while luxury housing prices rise and lenders lure them with competitive terms. As first-time homebuyers struggle to qualify for mortgages in a market that’s shrinking after the housing collapse, lenders are providing more multi-million dollar loans to Americans who pose less risk. These borrowers are using the loans to purchase high-end homes in cities such as San Francisco and Miami, where prices have been climbing. “We’ve seen strong appreciation in most of the coastal markets,” said Brad Blackwell, portfolio business manager at San Francisco-based Wells Fargo & Co., the biggest jumbo lender. “The price rise will move more homes into the category that would need a larger loan.”

Banks Face U.S. Manipulation Probe Over Metals Pricing - (www.bloomberg.com) The U.S. Justice Department is investigating whether the world’s biggest banks manipulated prices of precious metals such as silver and gold as it pushes to wrap up probes into currency-rate rigging, according to people with knowledge of the matter. At least 10 banks, including Barclays Plc, JPMorgan Chase & Co. and Deutsche Bank AG, are being probed by the Justice Department’s antitrust division, said one of the people, who asked not to be identified because the matter is confidential. Precious metals have come under scrutiny as authorities around the world investigate allegations that other financial benchmarks have been rigged. While the Justice Department’s probe is in its early stages, the Swiss regulator included the issue in a November settlement with UBS Group AG over currency-rate manipulation. British and German regulators have looked into the gold price-setting process and found no evidence it was rigged.

Obamacare guru Gruber's 'questionable' billing - (www.cnbc.com) This year isn't shaping up to be any better for Jonathan Gruber than 2014 was. An audit of work done for the state of Vermont by the controversial Obamacare architect found that he may have overbilled for the job. The audit is the latest in a series of black eyes for Gruber, who in a video that came to light last year was seen talking about how the "stupidity of the American public" allowed Obamacare to be passed into law. The Vermont audit, which cites Gruber's "inconsistencies and questionable billing practices," also faults state officials for failing to exercise sufficient oversight over the MIT economist's invoices. The audit has been referred to Vermont's Democratic attorney general, William Sorrell, who reportedly said it raises "serious questions."

Revolt In Athens: Syriza Central Committee Member Says "Leadership Strategy Has Failed Miserably" - (www.zerohedge.com) "Let us begin with what should be indisputable: the Eurogroup agreement that the Greek government was dragged into on Friday amounts to a headlong retreat. The memorandum regime is to be extended, the loan agreement and the totality of debt recognized, “supervision,” another word for troika rule, is to be continued under another name, and there is now little chance Syriza’s program can be implemented.... Greece will be receiving the tranche it had initially refused, but on the condition of sticking to the commitments of its predecessors.... How is it possible that, only a few weeks after the historic result of January 25, we have this countermanding of the popular mandate for the overthrow of the memorandum?"

1 in 3 Americans on verge of financial ruin - (www.marketwatch.com) The rich keep getting richer. The rest of us aren’t so lucky. According to a survey released Monday by Bankrate.com of more than 1,000 adults, 37% of Americans have credit card debt that equals or exceeds their emergency savings. “These numbers mean that three out of every eight Americans are teetering on the edge of financial disaster” — thanks to the fact that many of these folks might be hard-pressed to pay for an emergency should one arise, says Greg McBride, Bankrate.com’s chief financial analyst. “Not only do most of them not have enough savings, they’ve all used up some portion of their available credit — they are running out of options.” That’s particularly problematic considering that emergencies happen more often than you might think. A 2014 survey by American Express found that half of all Americans had experienced an unforeseen expense in the past year — some of which could be considered an emergency. Indeed, 44% of those who had an unforeseen expense(s) had one for health care and 46% for car trouble — two items that for many Americans are must-pay items, as you need a car to get to work and your health expenses are usually not optional.

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