Thursday May 1 Housing and Economic stories

Top Stories:

BUDGET BOMBSHELL / Governor boosts deficit forecast to $20 billion ... - (www.sfgate.com) – CA budget deficit is 30% higher than latest estimates made by CA lawmakers. Governor warns of steep cuts.
New U.S. farm bill retains big crop subsidies - (www.sfgate.com) – Politicians up to more of same. Providing large subsidies to subsidized farms that are enjoying unprecedented prosperity.
Business partner held in San Ramon killing - (www.sfgate.com) – Suspect and victim were business partners in real estate and mortgage industries. Suspect had sales license revoked in 2006 due to criminal conviction according to CA Dept of Real Estate records.
CALIFORNIA - Legislation would help fruit stands - (www.sfgate.com) – More worthless legislation created by state of CA to give special privileges to special groups.
The ‘Pay Option ARM Implosion’…Subprime’s Big Brother - (www.ml-implode.com) - The Wall St Journal just nailed Pay Option ARMs. Don’t ya love how the banks still categorize these as ‘Prime’. I have said for a long time now that ‘the Pay Option Implosion will make the Subprime Implosion look like a bad earnings report because they cut across all socio-economic boundaries’. Now the data are proving my point.
Investors lose despite city official's `guarantee' - (www.miamiherald.com) - investors, who collectively poured nearly $4 million into the Sandra Fay development, had bought into a lie. Florida City's former housing director, Matthew Price II, who had ''backed'' the project, was apparently trying to reward a developer who had given him the down payment on a house. Before construction was completed, the project went bust. Price was sentenced Friday to 30 months on federal conspiracy charges to commit fraud.
Argentine Bonds Plunge as Default Concerns Mount - (www.bloomberg.com)
Americans tapping the attic for spare cash - (msnbc.msn.com)
Countrywide Loss Focuses Attention on Underwriting - (www.freerepublic.com) - A federal probe of Countrywide, the nation's largest mortgage lender, is turning up evidence that sales executives at the company deliberately overlooked inflated income figures for many borrowers, people with knowledge of the investigation say. Some of the problems are surfacing in a mortgage program called "Fast and Easy," in which borrowers were asked to provide little or no documentation of their finances, according to these people and to former Countrywide employees. Both Countrywide and Fannie Mae, the government-sponsored company that bought many of the loans, classify the loans as "prime," meaning low-risk.
Must Government Inflate House Prices? - (www.lewrockwell.com)
Wachovia's hidden 'Watch Market Area' Guidelines - (www.ml-implode.com) - In a document obtained by the Mortgage Lender Implode-O-Meter dated April 29, 2008, Wachovia produced a matrix increasing minimum credit scores and dropping LTV's, most down to 65%. An example: Owner Occupied, Rate & Term Refi, Quick Qualify, minimum score 700, Max LTV/CLTV would be 65%. The matrix includes 8 little notes that further detail specific restrictions. Unfortunately the document is for Wachovia internal use only, and the outside reps and AE's have not been told. We made numerous calls and were told this document does not exist, if it did exist it is wrong, and regardless of the first two points, it's not for release by email or any other method. Starting to get the picture?
Defaults on Insured Mortgages Rise 37% in U.S. From a Year Ago - (www.bloomberg.com)
Alt-A Mortgages May Head Underwater - (www.bloomberg.com)
Rundown foreclosures may bring fine - (www.mercurynews.com) – Law could bring $1000/day fines to banks and lenders and investors. Private homeowners could still keep messy yards and houses.


Other Stories:

CALIFORNIA - Legislation would help fruit stands - (www.sfgate.com) – More worthless legislation created by state of CA to give special privileges to special groups.
Treasury considers new ways for Fed to use powers - (www.ft.com)
Housebuilders Turning Into Small Caps After 67% Slump - (www.bloomberg.com)
Consumer Confidence Slips as House Prices Drop - (www.nytimes.com)
Heading For Disaster - (www.youtube.com)
Bernanke May Have to Do More to Ease Jump in Bank Funding Costs - (www.ml-implode.com)
U.K. House Prices Posted First Annual Drop Since 1996 - (www.ml-implode.com)
Hamptons Home Prices Decline on Wall Street Job Cuts, Economy - (www.ml-implode.com)
SF Bay Area house prices falling faster - down 17% in February - (www.sfgate.com)
House prices decline in Los Angeles area among worst in U.S. - (news.xinhuanet.com)
A bottom in housing? That's a big 'NO' - (latimesblogs.latimes.com)
No brakes on housing prices - (money.cnn.com)
How Much House Can You Afford? Are You Sure?! - (www.ml-implode.com)
U.S. Economy Expanded at 0.6% Pace in First Quarter - (www.bloomberg.com)
Mortgage Applications Fall to Lowest Level This Year - (www.ml-implode.com) - ''Mortgage applications reached their lowest level yet this year, as borrowers stayed away from the both purchases and refinanci...
Quelle Surprise! Bush Homeowner Rescue Program Falls Short of Low Expectatios - (www.ml-implode.com)

ADP Says U.S. Companies Boosted Payrolls by 10,000 - (www.bloomberg.com)
As consumers step on the brakes, will the economy hit the wall? - (www.latimes.com)
Fed expected to lower rates, may signal pause - (www.reuters.com)
Fed Decision on Key Rate Presents Risks Either Way - (www.washingtonpost.com)
Forget ANWR, how about drilling in NPRA? - (www.chron.com)
Government's job numbers help the Fed - (www.nypost.com)
Parents delay decisions about summer camp as economy weakens - (www.chicagotribune.com)
Soaring gas, food prices may blunt goal of rebate - (www.signonsandiego.com)
Investors see recession, Wall Street depression - (www.reuters.com)
Mortgage application volume falls on few refinancings - (www.ap.com)
Housing foreclosures push Houston renters out the door - (www.chron.com)
Manufacturing execs downright gloomy about coming year - (www.financialweek.com)
Risk climbs to top of corporate to-do list - (www.financialweek.com)

House prices plunge at faster pace in February - (www.marketwatch.com)
House prices sink at record clip; foreclosures keep mounting - (biz.yahoo.com)
Foreclosure Numbers Double, California Yet to Hit Bottom - (blogs.wsj.com)
Houses facing foreclosure more than doubled in Q1 - (www.usatoday.com)
Global famine? Blame the Fed - (blacklistednews.com)
House price index sinks at record clip in February - (www.sfgate.com)

Workers' health insurance costs soar - (www.latimes.com)
Two Fatal Flaws in Fair Value - (www.cfo.com)
Book argues that SEC stifles bad news - (www.cfo.com)
Money markets rates riddle - (www.ft.com)
How the state can stabilise housing market - (www.ft.com)
Defaults Rising Rapidly For 'Pick-a-Pay' Option Mortgages - (online.wsj.com)
More Bad News Surfaces on Meriwether Funds - (www.nytimes.com)
Hamptons Home Prices Decline on Wall Street Job Cuts, Economy - (www.bloomberg.com)
The Road to a Jumbo Mortgage Was Supposed to Get Easier - (www.nytimes.com)
A New Wave of Vilifying Short Sellers - (www.nytimes.com)
Emerging Markets Lead 40% Currency Trading Jump - (www.bloomberg.com)
Bank bond issuance hits April record - (www.ft.com)
Countrywide's Problems Surface - (online.wsj.com)
GM Posts $3.25 Billion Loss on North America Deficit - (www.bloomberg.com)
Shortages Threaten Farmers’ Key Tool: Fertilizer - (www.nytimes.com)
GMAC Feels the Drag From Its Struggling Mortgage Unit - (www.ft.com)
Countrywide's loss hints at wider problem of flawed mortgages - (www.latimes.com)
US Airways CEO paid $5.4 million for 2007 - (www.azcentral.com)
Freddie Mac Differs With Regulator on 2007 Results - (www.washingtonpost.com)
Citigroup Increases Stock Offering to $4.5 Billion - (www.bloomberg.com)
Countrywide Loss Focuses Attention on Underwriting - (online.wsj.com)
FDIC orders Mesa bank to clean up its act - (www.azcentral.com)
European Confidence Declines to Lowest Since 2005 - (www.bloomberg.com)
Some Chinese Exporters Prefer Euros to Dollars - (www.nytimes.com)
As inflation squeezes middle-class Europe, anxiety about the future - (www.iht.com)
U.K. April Consumer Confidence Declines to Lowest Since 1992 - (www.bloomberg.com)
UK house prices suffer first annual fall in 12 years - (www.ft.com)
China Banks Face Bad Loan Risk After Record Profit - (www.bloomberg.com)
Fed needs tough chief in Paul Volcker mould - (www.ft.com)
Now, a Commodities Conundrum - (www.washingtonpost.com)
A passing storm? - (www.ft.com)