KeNo's Housing and Economic Portal: Friday September 23 Housing and Economic stories

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Greek Credit Swaps Surge to Record, Signal 91% Chance Nation Will Default - (www.bloomberg.com) Credit-default swaps on Greek government debt surged to a record, signaling a 91 percent chance the nation will fail to meet debt commitments, after its economy shrank more than previously reported. Five-year contracts on the country’s sovereign bonds jumped 196 basis points to 3,001 basis points, at 3:45 p.m. in London, according to CMA, which is owned by CME Group Inc. and compiles prices quoted by dealers in the privately negotiated market. Gross domestic product shrank 7.3 percent from a year earlier after declining 8.1 percent on an annual basis in the first quarter, the Hellenic Statistical Authority said. Greece’s financial situation is “on a knife’s edge,” German Finance Minister Wolfgang Schaeuble told lawmakers last night, according to parliament’s HIB bulletin.

FBI Raids Bankrupt Solyndra as Lawmakers Question Panel Maker’s Finances - (www.bloomberg.com) The FBI raided the headquarters of Solyndra LLC, the solar-panel maker that failed after receiving $535 million in loan guarantees from the Obama administration. Republican lawmakers said after the raid that the administration made misleading claims about the company’s prospects, and Democrats said the company’s chief executive officer withheld information on its financial plight. The Energy Department gave the Fremont, California-based company the most federal backing awarded a solar manufacturer. One of the principal investors in Solyndra is a foundation headed by billionaire George Kaiser, a campaign supporter of President Barack Obama who made 16 visits to the president’s aides since 2009, according to White House visitor logs. The Federal Bureau of Investigation executed a search warrant today with the Energy Department’s inspector general, bureau spokeswoman Julie Sohn said in an interview. Sohn said she couldn’t provide details about the investigation. Solyndra filed for bankruptcy protection on Sept. 6 with liabilities of $783.8 million, after shutting its factory and firing 1,100 people.

Moynihan Tries to Keep BofA Intact - (www.bloomberg.com) Lynch pulled out his BlackBerry and discovered another startling development: a rumor rattling Wall Street that Bank of America might get swept into an involuntary, government-orchestrated rescue by its smaller rival JPMorgan Chase & Co. “This is really getting nuts,” he thought. Lynch, who as the head of enforcement at the Securities and Exchange Commission in the late 1980s brought Ivan Boesky and Michael Milken to heel, knew he’d come under heavy fire when he parachuted into BofA this July. His assignment: Defend against a seemingly endless barrage of multibillion-dollar lawsuits and government investigations concerning defective mortgage-backed bonds manufactured at the height of the real estate bubble. No sooner did one liability bomb explode than it was followed by another. Now Lynch was doing duck-and-cover for real, while the bank’s share price was pounded to within a whisker of $6, down more than 50 percent since Jan. 1.

Greek backsliding sparks euro exit talk - (www.reuters.com) Anger at Greece's failure to meet fiscal targets that are a condition for its international bailout is nearing breaking point in Berlin and other European capitals, with senior politicians now talking openly about the possibility of Athens exiting the euro zone. Horst Seehofer, the head of the Bavarian Christian Social Union (CSU), was the first prominent figure in Germany to suggest publicly that Greece might eventually be forced to leave the 17-nation single currency bloc in an interview in the Bild newspaper on Wednesday. But he was expressing what many lawmakers and ministers in the German capital have been whispering behind closed doors for weeks, according to well-informed sources. German Finance Minister Wolfgang Schaeuble has ramped up his rhetoric since "troika" inspectors from the European Union, International Monetary Fund and European Central Bank suspended talks on payment of a new aid tranche to Greece last week due to backsliding on its deficit targets.

AMERICA TODAY: Inside Lakewood New Jersey's Homeless Tent City - (www.businessinsider.com) Doug Hardman wakes up every morning with a song in his head -- a vague memory of his days on stage. Inside his tepee in the woods outside Lakewood, NJ, at the homeless Tent City, the roosters wake early and the mornings are already cooler. A musician who lost his Florida home in the housing crisis, Hardman says he floats in and out of Tent City, that he's proud of his kids, and misses the life he no longer has. He has a lot of company out here. Click here to see pictures > Tent City made the news recently and while community leader Steven Brigham says the media attention brought in greater donations, it also brought unwanted attention from the local politicians. After battling with the city for years to have access to the public land here, Brigham found a New Jersey lawyer to represent his case pro bono. The attorney, Jeff Wild, argued that the homeless population are part of the public and should therefore have access to public lands. Rather than take the case to court, Lakewood City Council settled, and Brigham signed an agreement to put up no more shelters and allow no more than 70 people to stay. But last winter the community put up three wooden structures to house everyone and keep them warm. "We didn't lose anybody last year," Brigham says, "and nobody got sick." This year could be different. After City Council members saw the shelters on TV, they sent demolition crews in. The walls were torn down around whatever was inside, and meager furnishings were left to the elements.