KeNo's Housing and Economic Portal: Wednesday August 11 Housing and Economic stories

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Toughest Job in Hungary? - (www.nytimes.com) It’s not easy being a central banker in Europe — especially during the biggest economic crisis in a generation. But Andras Simor, the governor of the Hungarian Central Bank, has it even worse than most. Not only has the new government of Viktor Orban placed the blame on Mr. Simor, among others, for Hungary’s stagnant economy, it has slashed his salary by 75 percent. The Hungarian government has attacked him for holding offshore investments in Cyprus and, insiders say, now may even consider pressing criminal charges in a bid to force him from office. What those charges might be is unclear, and Mr. Simor says there is no basis for any accusations of wrongdoing. In Brussels, the European Commission is pondering a legal challenge to the policy maker’s pay cut on the basis that it is an unwarranted interference in the operations of the central bank. A spokesperson for the government in Budapest did not respond to questions about the central banker’s standing.

Italy trapped in slow lane as political crisis deepens - (www.telegraph.co.uk) July car sales have plummeted in Italy, compounding the country’s woes as political crisis threatens months of wrangling and fresh concerns about the safety of Italian debt. Rome said new registrations dropped 26pc from a year earlier, led by a 36pc fall for Fiat. "It is a complete disaster for everybody. The prime minister needs to take charge," said Filippo Pavan Bernacchi, head of the trade lobby Federauto. Fiat’s chief executive Sergio Marchionne said Italy is the only part of the world where the resurgent company has not made a profit over the last eighteen months. "Italy’s industrial network cannot compete as it is," he said. Mr Marchionne is embroiled in a showdown with Italy’s trade unions, demanding a radical overhaul of working practices before agreeing to fresh investment. "We want to run the plants. There is nothing obscene about that, but here in Italy it seems like we are asking for the moon," he said. Italy has weathered the crisis of the last three years in good shape, thanks to modest private debt and the firm hand of finance minister Giulio Tremonti. However, political risk is rising as the ruling party of premier Silvio Berlusconi breaks apart over claims of corruption, masonic conspiracies, wire-tap abuses, and attempts to interfere with the courts and free speech. Mr Berlusconi’s attempts to silence his erstwhile ally and chief critic Ginafranco Fini have back-fired badly, leading to revolt that has stripped the government of its parliamentary majority.

With friends like this.. - (www.nytimes.com) IS it a blinding statement of the obvious to say that trust in the world’s banks has suffered lately? Indeed, just when you think you’re ready to move past the steady drumbeat of disconcerting revelations, something else crops up to test your faith. Only last week, Citigroup, once the world’s biggest bank, settled regulatory accusations that it hid tens of billions of dollars in bad assets as the subprime mortgage storm intensified in 2007 — making Citi’s finances appear much less imperiled than they actually were. Remember, financial wizards like Robert Rubin and Charles Prince helped oversee Citi during the years that it stuffed itself so full of those toxic assets that taxpayers had to be called upon to bail out the bank. Here’s yet another data point: the recent conclusion of a lawsuit filed by a unit of Grupo Televisa, the largest media company in the Spanish-speaking world, against its longtime lender, JPMorgan Chase. The complaint was filed last December in United States District Court in Manhattan by Empresas Cablevision, a Grupo Televisa telecom unit that had borrowed $225 million from JPMorgan in late 2007. Cablevision used the money to expand its Mexican operations. According to court documents, JPMorgan had intended to syndicate the loan but the growing credit crisis in 2008 forced the bank to hold on to it. In early 2009, after the financial storm had quieted, the bank explored selling the loan in cooperation with Televisa to three international banks — HSBC, BNP Paribas and Scotia Bank.

7billion $s a year skimmed off our savings - (www.telegraph.co.uk) A range of questionable hidden fees and levies are being deducted from investments, making it difficult for a typical saver to make money from the stock market. Britain’s eight million investors are losing an average of £800 a year each to the hidden levies. An investor putting £50,000 into a fund providing typical returns over 25 years would lose out on £108,000 because of unnecessary charges, said David Norman, a former chief executive of Credit Suisse Asset Management. Customers have no way of claiming back their lost savings because fund managers are not doing anything illegal or beyond the rules. However, they are now likely to face increased scrutiny from regulators, while the Government could come under pressure to announce an inquiry to clean up the industry, which millions rely on to save for their retirement. The problems have been compounded by the lacklustre stockmarket, which has hit savers as City firms have rushed to protect their profit margins by increasing fees. Research has shown that fees in this country are far higher than those in America, where investment funds have been the subject of several regulatory and other official investigations.

Banks Withholding Highend Repossessions Over $300,000 From Market - (www.realestatechannel.com) With the expiration of the first-time buyer tax credit on April 30, there are now two main props keeping the housing market afloat. One is the growing percentage of home sales financed by Federal Housing Administration (FHA) loan guarantees. The other is the refusal of banks to put on the market foreclosed homes over $300,000. In this article, we will take a look at the second factor. A future report will examine the role of the FHA in keeping the market from collapsing. Chicago and Cook County, IL: Let's begin with Chicago. Cook County is comprised of Chicago and its contiguous suburbs and has a population of roughly 5.3 million residents. It experienced a huge bubble during 2004-2006 and has suffered a substantial drop in both prices and home sales. RealtyTrac.com has the most comprehensive database on foreclosures. It claims to have specifics on over 1.5 million defaulted, auction-ready, and bank-owned properties. The information is updated daily. You can organize listings of defaulted properties; those scheduled for auction, and repossessed homes (REO) by date as well as by amount. The website also provides a separate listing of those properties which have been put up for sale by the lender.

Tampa FL area has 9-year building site inventory - (www.tbo.com) A building boom, followed by a lackluster economy, has left the five-county area around Tampa with enough vacant home sites to last builders nine years. And that doesn't even count all the land set aside for new subdivisions. There are 27,923 vacant lots, including multi-family, primed for construction, in Hillsborough, Hernando, Pinellas, Pasco and Citrus counties, according to second quarter data from Houston-based housing research firm Metrostudy. The number is a striking reminder of how deep the housing crisis in west central Florida has become and how long it will take to struggle back to a sustainable level. "The housing industry in Tampa Bay needs the economy to improve," said Tony Polito, who gathered the data. "The area needs jobs." The county breakdown is even more telling. Here's the supply of single-family lots and how long it will take to absorb them at the current sales pace. Hillsborough: single family lots - 9,594; years of supply – 4 years, 9 months

Time to wind down Fannie Mae and Freddie Mac - (www.dallasnews.com) President Barack Obama signed new reforms into law last week that should rein in some of Wall Street's most wanton behavior – well, at least until bright financial minds devise new loopholes. But Congress can't consider this work complete until it tackles two more looming threats to another economy-rattling mortgage meltdown. Options to reform Fannie and Freddie

• Create new quasi-governmental corporations that would compete with each other.

• Sell off assets to other mortgage firms.

• Privatize them but maintain some government guarantees.

• Restructure them into public utilities; government would regulate profits, set fees and guarantee their assets.

Those would be Fannie Mae and Freddie Mac, the two part-government, part-private lenders that were more than bit players in the crisis. The new law left Fannie and Freddie untouched, even though they racked up huge losses during the housing crash, ultimately requiring massive taxpayer bailouts and a government takeover. At $160 billion and rising, these costs could prove to be the largest hits to taxpayers resulting from the crisis.

Here's house of pricey Vernon pensioner - (huntingtonhomes.ocregister.com) Last week we looked at the Huntington Beach house owned by Robert Rizzo, who just resigned from his nearly $800,000-a-year Bell city manager job after public outcry over his paycheck. Today, we’re peeking at the Surf City home of yet another controversial ex-L.A.-area official — Bruce Malkenhorst Sr. Before Rizzo’s salary hit the news, the wages of Malkenhorst, a longtime Vernon administrator, were coming under fire. Malkenhorst was the highest paid city official in the state before he stepped down, bringing in more than $600,000 a year — in a city with fewer than 100 residents. The Register reported in 2009 that Malkenhorst pulled in the biggest municipal pension in California — close to $500,000 a year. The story noted that “for three decades Malkenhorst was Vernon’s city manager, finance director, redevelopment director, city clerk, city treasurer and head of the municipal light and power operation.” By the way, Malkenhorst is awaiting trial on charges of embezzling $60,000 for massages, golf outings, meals and other stuff. He was unapologetic in an interview with Register reporter Tony Saavedra, saying, “If I had a bad back and got a massage, I got a massage.” He added that the Vernon city council approved his expenses.