Monday April 20 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

San Diego foreclosure missing $1 million in furnishings - (www.signonsandiego.com) After a high-profile foreclosure, the county's largest and possibly most luxurious bank-owned home is missing an estimated $1 million worth of furnishings, from antique doors to top-of-the-line toilets. So far, no suspect has been named in a grand theft investigation opened by the San Diego County Sheriff's Department in March. “It's like a car up on blocks,” Sheriff's Detective Steven Ashkar said. “It's been stripped.” The 16,000-square-foot Spanish hacienda-style house on 1.24 acres is surrounded by trees on Fortuna Ranch Road in Encinitas. Decorated with 300-year-old doors from Egypt, carved teak pillars from Antigua, stained-glass windows, crystal chandeliers and handmade tiles from Mexico, the home cost $13 million to build and furnish. In February, it failed to sell at a bank foreclosure auction with a starting bid of $2.3 million. Suzy Brown, an electrical engineer who built the house, reluctantly surrendered title to the bank on Feb. 13 after not making payments for more than a year. She moved out March 22. On March 26, Capital One Bank's real estate agent, Katie Taylor, filed a police report citing missing “doors, windows, fixtures, toilets, windows, cabinets and appliances,” Ashkar said. The house has been controversial since Brown obtained a construction permit in 2004. She originally planned to operate it as a drug-rehabilitation center in a venture with alternative medicine physician Deepak Chopra and 60 unnamed investors. Neighbors dubbed it the “monster house” because of its size, and complained that Brown intended a commercial venture in a residential area. They sued Brown and filed a complaint with the state Department of Corporations. While both ultimately were dismissed, construction was delayed and the Chopra Center dropped out.

Germany Offers to Buy Out Hypo Real Estate - (www.nytimes.com) The German government moved closer on Thursday to nationalizing the troubled mortgage lender Hypo Real Estate Holding, saying it planned to buy all of the company’s outstanding shares. Meanwhile, the ING Group, the big Dutch bank, said it would sell assets to shore up capital. Soffin, the German government’s financial market stabilization fund, said it would offer 1.39 euros, or $1.85, a share for the 91.3 percent of Hypo’s shares that it did not own. That valued the company at about 290 million euros, or $385 million, a 13 percent premium over Wednesday’s closing price. On March 28, the government said it would take an 8.7 percent stake in the company as a first step toward gaining full control. Soffin’s offer, for which there is no minimum acceptance level, is contingent on the approval of Bafin, the German market regulator.

Goldman Sachs Threatens A Different Blogger - (www.goldmansachs666.com) Time to take a sledge-hammer to the greedy and power-hungry TARP and taxpayer sucking executives of the House of Goldman Sachs. Goldman Sachs v. Mike Morgan It looks like Goldman Sachs is not happy with this website I created to post information about Goldman Sachs. I received the letter below from their attorney today, and my Intellectual will publish the truth. Feel free to visit the blog and leave your comments. You may also submit posts through the blog or our blog email address Mike@MikeMorgan.us Property attorney will be responding accordingly. It's only been up about a week, and there is not much on there yet, but I invite everyone to submit articles and posts to the website relevant to Goldman Sachs. All posts will be reviewed, but unless they are clearly false or malicious, we Needless to say, we will most likely fight this one in court with Goldman Sachs and now we will expedite adding relevant content to this website. We have followed all of the legal requirements to own and maintain the website under the address we have selected. If you have any media contact you want to forward this to, be my guest. It's just another example of how a bully like Goldman Sachs tries to throw their weight around and this is a clear violation of our Constitutional Rights.

TARP Recipients Required to Modify Loans, HUD Says - (www.bloomberg.com) Banks receiving federal aid through the U.S. Troubled Asset Relief Program must also take part in the government’s mortgage modification initiatives, Housing and Urban Development Secretary Shaun Donovan said. The U.S. is “going to require as a condition of participation in TARP going forward that banks do participate in” the Obama administration’s Making Home Affordable plan, Donovan said in an interview on Bloomberg television today. The requirements would apply only to banks taking new TARP money in the future, not those that have previously taken aid, Melanie Roussell, a HUD spokeswoman, said in an interview. As of last month, only government-seized mortgage-finance companies Fannie Mae and Freddie Mac were participating in President Barack Obama’s Making Home Affordable program, Pat Lawler, the chief economist of the Federal Housing Finance Agency, told a House committee on March 19. Donovan said today “every indication” is that private banks will participate. The modifications, which target 3 million to 4 million homeowners facing foreclosure, would require lenders to cut interest rates, extend repayment terms and forbear or forgive principal payments as necessary to reduce homeowners’ monthly payments to a more affordable level. Since Obama announced his plan in February, refinancings have risen 88 percent and mortgage rates have dropped to record lows, Donovan said. “We’re certainly seeing some early good news,” Donovan said. “It’s a sign that the administration’s plan is working.”

Questions Over Bailout for Insurers - (www.nytimes.com) As the Treasury Department considers life insurers’ applications for a bailout, big questions remain about how hard a bargain the government will drive. The Treasury has taken two different stances in its six months running the Troubled Asset Relief Program, or TARP. For the banks, cash infusions came quickly, with few strings attached, in an urgent attempt to strengthen the financial system. But after initially extending credit to the automakers, the Treasury has taken a much harder line with Detroit by insisting that General Motors produce a more credible business plan and Chrysler seek a merger partner. The question is whether the Treasury will pour billions more into shoring up the life insurers or subject each to rigorous testing, then determine which are viable and perhaps force quiet mergers and divestitures for those deemed too weak to save. A spokesman for the Treasury said that the criteria for insurers were still being developed and that it would probably be at least two weeks before any of them got their answers. But the stock market seemed to believe that the insurers’ chances were greatly improved on Wednesday. After The Wall Street Journal reported that the Treasury might have an announcement within days, stock in Hartford Financial Services Group rose 13.5 percent, and that of the Lincoln National Corporation rose more than 30 percent. All of the dozen insurers that have applied for TARP money are believed to be life insurers, although not all have been identified. Some are well-known companies, like MetLife and Prudential Financial.

Genworth Fails to Qualify for TARP; Shares Plunge - (www.bloomberg.com) Genworth Financial Inc., the Virginia-based seller of life insurance and mortgage coverage, failed to qualify for a capital injection from the U.S. Treasury. The stock dropped 16 percent in extended trading. The Office of Thrift Supervision didn’t approve Genworth’s application to become a savings and loan holding company, the Richmond-based insurer said today in a statement distributed by PR Newswire. Genworth said it’s abandoning the plan. Genworth was rejected after the regulator approved plans from competing life insurers including Hartford Financial Services Group Inc. to gain status as lenders, a requirement for funds from the Troubled Asset Relief Program. Downgrades and a 12-month stock slide squeezed Genworth’s access to private capital, and in November it was ousted from the U.S. program that provides short-term financing. “This signals a lack of confidence and I think people are going to see this and realize that they don’t have many options left,” said Alan Rambaldini, an equity analyst at Morningstar Inc. in Chicago. “It’d be good if they could sell one of their businesses to raise money. But they don’t have a good mix of businesses right now.” The insurer dropped 44 cents to $2.31 at 6:26 p.m. in New York. Genworth, which has been unprofitable for three straight quarters, has dropped more than 80 percent in the past 12 months on the New York Stock Exchange.

Treasury Weighs Investment in Life Insurers - (www.nwashingtonpost.com) The Treasury Department is considering opening another front in the effort to manage the financial crisis, saying that some life insurance companies qualify for a potential investment of taxpayer dollars. Treasury has determined that a small number of insurers are eligible for funds under the Troubled Assets Relief Program, and it is evaluating their requests on a case-by-case basis using the same criteria it applies to banks. "These are among the hundreds of financial institutions in the . . . pipeline that will be will be reviewed and funded as appropriate on a rolling basis," Treasury spokesman Andrew Williams said yesterday by e-mail. Although Congress last year granted the Treasury the authority to buy stakes in life insurers, the department has been slow to do so, partly because the federal government does not regulate life insurance companies and has limited ability to monitor their financial condition. Life insurers are regulated by the states. To make sure that the federal government had at least a limited window into the affairs of TARP recipients, the Treasury declared last year that insurers would qualify only if they owned banks or thrifts, which would put their holding companies under the purview of Washington regulators such as the Office of Thrift Supervision. To meet that test, some insurers bought thrifts. Still, during the Bush administration, Treasury officials warned that such maneuvers might not be sufficient. Now, the Treasury Department appears to have gotten past some of the earlier qualms.

New Hampshire Court Suppresses Blogger's Freedom Of Speech - (www.citmedialaw.org) A reader recently tipped us off to a troubling ruling from a trial court in New Hampshire: The Mortgage Specialists, Inc. v. Implode-Explode Heavy Industries, Inc., No. 08-E-0572 (N.H. Super. Ct. Mar. 11, 2009). In the decision, Justice McHugh of the Superior Court for Rockingham County ordered the publishers of the popular mortgage watchdog website, The Mortgage Lender Implode-O-Meter ("ML-Implode"), to turn over the identity of an anonymous source who provided ML-Implode with a copy of a financial document prepared by The Mortgage Specialists, Inc., for submission to the New Hampshire Banking Department. The court also ordered ML-Implode to reveal the identity of an anonymous commenter who allegedly posted defamatory statements about the company and enjoined the website from re-posting the financial document or the allegedly defamatory comments. Background: ML-Implode, founded by computer scientist and mathematician Aaron Krowne in 2007, tracks the financial health of mortgage lending companies. Krowne and ML-Implode were way ahead of the curve in recognizing the then-impending-now-catastrophic crisis in the housing market and mortgage industry. As Louise Story of the New York Times wrote in an article about the website last summer, these days "[t]he misery in the housing market is registering on the Implode-O-Meter." Without question, the website provides original reporting on one of the most critical issues facing the country today: With the economy struggling, more financial companies, even well-known ones, are finding themselves on [ML-Implode's] fated list. When parts of Bear Stearns’s residential mortgage unit were sold to private equity investors, for instance, the Implode-O-Meter recorded the sale. And E*Trade Financial could not remove the link on its site to its mortgage division or change the recording on its mortgage division’s 1-800 number without the site chiming in. The tips usually come anonymously from employees at the troubled mortgage companies. Critics of the site say some of the tips have been more gossip than reality. But the Implode-O-Meter often posts the phone recordings and company e-mail to back up the bad news coming out of places like Merrill Lynch, which in March fired nearly everyone at First Franklin Financial, a business it purchased in 2006. (Source)




OTHER STORIES:

Hedge Fund Managers With Most Assets Face EU Rules - (www.bloomberg.com)
BOE Leaves Rate at 0.5%, Continues Pace of Bond Plan - (www.bloomberg.com)
Bank of England Vows to Buy Assets to Bolster Lending - (www.nytimes.com)
Japan Drafts $154.4 Billion Stimulus - (www.nytimes.com)
Inside the Fed's Trillion-Dollar Decision: Crisis Outweighed Inflation Fears - (www.washingtonpost.com)

Chevron warns of 'sharply lower' earnings - (www.marketwatch.com)
Banks Holding Up in Tests, but May Still Need Aid - (www.nytimes.com)
Only 30% of foreclosures listed for sale so far - (www.sfgate.com)
CA Foreclosures About to Soar - (www.fieldcheckgroup.com)
Why house prices may never recover - (articles.moneycentral.msn.com)
Average Canada house price will fall to $246,000 in '09 - (www.financialpost.com)
Apartment rents fall in Southern California - (www.latimes.com)

Bernanke's: A Glide-path to destitution - (www.patrick.net)
States' warnings about subprime loans were ignored - (www.idahostatesman.com)
Housing agencies cook their books, then ask for $300M stimulus cash - (www.usatoday.com)
The Obama Teams Disclosure Documents - (www.propublica.org)
1819: America's First Housing Bubble - (www.mises.org)
Homeward Rebound: Weathering the Storm With Kin - (online.wsj.com)
Two dozen charged in alleged gang-led mortgage fraud - (www.reuters.com)