KeNo's Housing and Economic Portal: Tuesday March 15 Housing and Economic stories

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TOP STORIES:

Fannie Mae $2.1B loss for Q4, who cares, taxpayers will pay it - (finance.yahoo.com) Government-controlled mortgage buyer Fannie Mae has posted a narrower loss of $2.1 billion for the October-December quarter of last year, and asked for an additional $2.6 billion in federal aid. The new request is slightly more than the $2.5 billion it sought in the July-September quarter. The mortgage buyer also reported a $21.7 billion loss for all of 2010. The government rescued Fannie Mae and sibling company Freddie Mac in September 2008 to cover their losses on soured mortgage loans. It estimates the bailouts will cost taxpayers as much as $259 billion. Fannie Mae's October-December loss attributable to common stockholders works out to 37 cents a share. It takes into account $2.2 billion in dividend payments to the government. It compares with a loss of $16.3 billion, or $2.87 a share, in the fourth quarter of 2009. Washington-based Fannie Mae and McLean, Va.-based Freddie Mac own or guarantee about half of all mortgages in the U.S., or nearly 31 million home loans worth more than $5 trillion. Along with other federal agencies, they played some part in almost 90 percent of new mortgages over the past year.

Stock Market Crash 2011 by Christmas? - (www.marketwatch.com) Politicians lie. Bankers lie. Yes, they’re liars. But they’re not bad, it’s in their genes, inherited. Their brains are wired that way, warn scientists. Like addicts, they can’t help themselves. They want to sell stuff, get rich. We want to believe they’re telling us the truth. Silly, huh? Both trapped in this eternal “dance of death” controlled by programs hidden deep in our brains, telling us what to do, telling us to ignore facts to the contrary — till it’s too late, till a new crisis crushes all of us. Psychology offers us a powerful lesson: Our collective brain is destined to trigger a crash before Christmas 2011. Why? We’re gullible, keep searching for a truth-teller in a world of liars. And they’re so clever, we let them manipulate us into acting against our best interests. In fact, behavioral science tells us that bankers and politicians are lying to us 93% of the time. It’s 13 times more likely Wall Street is telling you a lie than the truth. That’s why they win. Why we lose. Because our brains are preprogrammed to cooperate in their con game. Yes, we believe most of their lies.

Shouldn't justice department investigate NAR for inflating sales figures? - (www.patrick.net) I read on MSN that the NAR apparently overstated home sales by as much as 20% as far back as 2007. The author opines, without any apparent reason, that “No one seems to be implying that numbers were massaged, cooked or manipulated.” I would think there is every reason to believe the numbers were massaged, cooked or manipulated since that would be in the NAR’s interests and consistent with its numerous misleading practices. If the numbers were manipulated by the NAR, I would think that would make the NAR a target for legal action by anyone and everyone who purchased real estate while the numbers were being manipulated and subsequently saw the market price of their property drop (that would be the vast majority who purchased since 2007). Obviously inflated figures would have inspired false buyer confidence. Shouldn’t the justice department investigate? Wouldn’t this constitute a RICO violation? A subpoena of email and other correspondence at the NAR would likely allow an easy determination of innocence or guilt.

Arizona Bill SB1259 Would Void Foreclosures Without Full Title History - (www.4closurefraud.org) Arizona may become the first state to require lenders to prove they have the right to foreclose by providing a complete list of any previous owners of the mortgage, under a bill passed yesterday by its Senate. The legislation, which is headed to the House after being approved 28-2 in the Republican-dominated Senate, would allow foreclosure sales to be voided if lenders that didn’t originate the loan can’t produce the full chain of title. Arizona permits non-judicial foreclosures, meaning property can be seized from the homeowner without a court order. Lawmakers in states including New York, Oregon and Virginia also have proposed legislation to address concerns among consumer advocates that lenders or mortgage servicers are using incomplete or false paperwork to repossess properties in default. The attorneys general of all 50 states are jointly investigating how the mortgage-servicing industry operates. “If you foreclose on somebody you should have to tell them who owns the property,” Michele Reagan, who sponsored Senate Bill 1259, said in a telephone interview. “People have the right in this country to face their accusers.” The Republican lawmaker is in litigation with her mortgage servicer, which she said won’t identify the owner of the loan.

Banks Just Too Big To Fail? Iceland Proves Otherwise, but Ireland Gives Up - (www.dailybail.com) Decision to let banks go under looks smarter by the day, in contrast to Ireland's costly bailout. On his second day as head of Iceland's third-largest bank, Arni Tomasson faced a crisis: the firm that regulators had asked him to run was out of cash. It was October 8, 2008, at the height of the global financial meltdown and Iceland's bank assets in Britain had been frozen. Customers flocked to branches of Tomasson's Glitnir Banki to withdraw money, even though the Government had guaranteed their deposits. By the end of the day, the vaults were empty, says Tomasson, recalling the drama. The only way Glitnir and other lenders could avoid a panic the next morning was to get more cash, which they were having trouble doing. A container of crisp kronur sat on the tarmac at Reykjavik's airport awaiting payment. The British company that printed the bills, De La Rue, was demanding sterling, and the central bank couldn't access its British account.