Monday March 3 Housing and Economic stories

Top Stories:

Arnold starting to look an awful lot like Gray Davis, as CA Financial picture coming apart at the seams:
· California Lost 20,300 Jobs in January - (www.sfgate.com)
· CA, preparing to borrow, faces cold market for munis - (www.latimes.com)
· Firemen Paid Over $200,000 Drive CA city to Bankruptcy - (nalert.blogspot.com) – we have been following this story for past week. As Vallejo, CA is on the verge of bankruptcy, 10 fireman make at least $200K per year.
· San Fernando Valley prices down 24% in 7 months - (latimesblogs.latimes.com)
· Foreclosure victim on bailout: 'No way, Jose!' - (latimesblogs.latimes.com)
· Sacramento must cut 500 because of budget woes - (www.sfgate.com)

Second-mortgage holders block refinancings - (www.charleston.net) – I am siding with the holder of the 2nd note on this case, as it is contract law and I personally lost $80K to a crooked homeowner and appraiser who had me in a subordinated position. For the realtor to call the lender’s action outrageous is outrageous. If the house has so much equity, then why didn’t the lender for the first mortgage take on the 2nd?
Jackson faces loss of Neverland ranch - (www.independent.co.uk)
U.S. Office of the Comptroller of the Currency Orders 9 Banks to Provide Monthly Data on Their Home Loans - ``Finally these banks Will have some accountability for their actions. Up until now, it has been all public and media lip service... – (www.loanworkout.org)
Reckoning for a Real Estate Mogul - (money.aol.com) - Harry Macklowe, the 70-year-old developer, is in the middle of a maelstrom of a different kind. This time it's in the credit markets. Thanks to his personally guaranteeing a $1.2 billion loan last winter, he may lose billions of dollars in real estate, his homes in Manhattan and the Hamptons, his contemporary art collection, and even his beloved yacht. This would be a bitter end to the career of one of New York City real estate's most polarizing figures.
Regulators are bracing for 100-200 bank failures - (www.cnn.com)
Makes No More Cents? - (www.sfgate.com) – As Helicopter Pilot Bernanke and corrupt Treasury Secretary Paulson stoke inflation, Treasury discusses getting rid of the penny.
AIG's Evaporating Balance Sheet - (www.ml-implode.com)
Ambac, Seeking Capital, Given More Time by Moody's - (www.ml-implode.com)
Fed's Poole: GSEs Too Big to Fail? - (www.calculatedrisk.blogspot.com)
Facing Default, Some Walk Out on New Houses - (nytimes.com)
Fannie Proposes Ban on Lenders' Fraud, Much Too Late - (www.bloomberg.com) – As usual, government and government entities behind the curve by 5-10 years.


Other Stories:

Bank of Montreal Misses Margin Calls - (globaleconomicanalysis.blogspot.com/)
Poole, Paulson, Bernanke on Bailouts and Bank Failures - (globaleconomicanalysis.blogspot.com/)
Free Fall In Munis, Worst Month Since 2003 - (globaleconomicanalysis.blogspot.com/)
Ambac Deal Hits Snag, MBIA writing "Very Little" New Business - (globaleconomicanalysis.blogspot.com/)
Hedge Funds Blame Wall Street Instead Of Themselves - (globaleconomicanalysis.blogspot.com/)

Update: Merrill's First Franklin worried about severance packages - It's official. Merrill Lynch announced today that it would be shutting down First Franklin, Reuters reported today. An email tip we received just moments before the release said they would be "keeping open only a small servicing shop." "The move could result in the elimination of 400 to 500 jobs." No details were given as to a timeline for the winding down of operations.... - (www.ml-implode.com)
US Bankruptcy Court Asks for Sanctions Against Countrywide - 'The federal bankruptcy trustees in Florida, Georgia, and Ohio have decided to take on Countrywide for a persistent practice of ... - (www.nakedcapitalism.com)
More Recession Alarms Are Going Off - 'The alarm bells of U.S. recession rang louder on Friday as reports showed business activity in the U.S. Midwest plummeted in Fe... – (www.commonsenseforecaster.blogspot.com)
Sacrificing Fannie And Freddie - … but a release of the cap will help to keep their problems in check? Surely there are different problems now--and the 30% cushion helps to keep the stability of the quasi-agency companies during times when write-offs and write-downs are growing. Think of this cushion as analogous to the loan-to-value minimum homeowners are required to meet to qualify for a mortgage.
... - (www.forbes.com)
The Hits Keep Coming: Fitch Downgrades $9.4 Billion in Subprime RMBS - (www.ml-implode.com)
Goldman cuts Morgan target on home equity woe - (www.ml-implode.com)
DB's MortgageIT cuts 2000 jobs - (www.ml-implode.com)
S&P: 1,887 Classes of Alt-A MBS may be Downgraded - (www.ml-implode.com)
Moody's eyes Fannie Mae downgrade - (money.cnn.com)
Let Houses Find a Bottom - (gotapex.com)
The Worst-Case Scenario for Housing - (usnews.com)
Bernanke Readiness to Cut Rates Stokes Inflation - (bloomberg.com)
Fallacy of Inflation Targeting - (Mish)
Builders threaten Congress - (sfgate.com)
Outlook for U.S. banks just got gloomier - (financialpost.com)
Countrywide Chooses Sun Over Ski Trip! - (www.ml-implode.com)
Billions of dollars of sales slam muni bonds - (www.ml-implode.com)

House Prices Across the Nation - (nytimes.com)
Don't follow herd on the economy - (cnn.com)
Declining House Prices, Rising Mortgage Rates - (seekingalpha.com)