KeNosHousingPortal.blogspot.com
TOP STORIES:
House Democrats lobby to give free money to loan owners - (www.irvinehousingblog.com) More than 20 Democrats in the U.S. House of Representatives on Tuesday called on the regulator of Fannie Mae and Freddie Mac to help underwater borrowers by allowing their loan principal to be reduced. The regulator has faced increasing pressure to permit the write-down of principal by the two government-controlled mortgage finance providers as a way to help some of the millions of Americans who owe more than their homes are worth. The Federal Housing Finance Agency, however, has stood fast out of concern such a change would undercut finances of Fannie and Freddie.
"We strongly urge that you reconsider your refusal to allow principal reductions to achieve better-performing (loan) modifications and avoid the extreme losses of unnecessary foreclosures," the 21 lawmakers wrote in a letter to the FHFA. Nobody is discussing the bigger issue of moral hazard. If you give away free money, it will encourage imprudent borrowing because the borrowers know they can petition for a bailout and get it. That's the real reason we shouldn't consider principal reductions. I am relieved the FHFA is resisting increasing the losses on the government's GSE portfolio. Giving away free money will certainly do that. As for the congressmen, their argument is specious. How does giving away free money avoid extreme losses? Doesn't that guarantee losses? Are the congressmen really arguing that by giving away some now taxpayers will lose less later? Does anyone else see the insanity in that?
VIDEO - The next 'Great Depression' has begun - (www.youtube.com) Sarah Montague talks to Steve Keen, one of the few economists to have predicted the global financial crisis, about the possibility of another Great Depression, and how to avoid it. 'Another Great Depression is all but inevitable' - that's the view of Steve Keen. He's been called the 'Merchant of Gloom', but he's one of the few economists to have predicted the global financial crisis. While he used to be a lone voice in challenging the economic consensus, more and more people are now listening to him. His way of avoiding depression? Write off the debt, bankrupt the banks, nationalise the financial system, and start all over again. He talks to Sarah Montague.
Corporate balance sheets 'strongest in history? - (www.businessinsider.com) American Airlines went bust this morning, which should have come as a surprise to no one who has followed the company and airline industry over the years. (The company recently denied bankruptcy rumors by stating that bankruptcy was "certainly not our goal or preference," which is about as close as a corporation will ever come to saying "Of course we're going to declare bankruptcy, you idiots, why are you even bothering to ask?") But the bankruptcy WILL come as a surprise to the millions of Americans who have repeatedly been exposed to one of the consensual hallucinations that bullish investors and pundits have been mouthing in recent months: To wit: Corporate balance sheets are the strongest in history and companies are awash in cash. It is true that companies have plenty of liquidity, which they didn't a few years ago. But corporate balance sheets are in fact no "stronger" than the balance sheet of someone who borrows a million dollars and then spends only little of it.
Judge blocks settlement between SEC and Citigroup - (www.nytimes.com) Taking a broad swipe at the Securities and Exchange Commission’s practice of allowing companies to settle cases without admitting that they had done anything wrong, a federal judge on Monday rejected a $285 million settlement between Citigroup and the agency. The judge, Jed S. Rakoff of United States District Court in Manhattan, said that he could not determine whether the agency’s settlement with Citigroup was “fair, reasonable, adequate and in the public interest,” as required by law, because the agency had claimed, but had not proved, that Citigroup committed fraud. As it has in recent cases involving Bank of America, JPMorgan Chase, UBS and others, the agency proposed to settle the case by levying a fine on Citigroup and allowing it to neither admit nor deny the agency’s findings. Such settlements require approval by a federal judge.
The Guy Who Drove His $2 Million Bugatti Into A Lake May Have Done It As Part Of An Elaborate Insurance Fraud - (www.businessinsider.com) The 2009 crash of a Bugatti Veyron into a Texas lagoon is back in the spotlight and now part of an investigation into a very complex case of insurance fraud. According to Speed Channel, Philadelphia Indemnity Insurance Company claims that the owner of the car, Andy House, intentionally crashed the car into the lake to secure a massive payout from insurance. Here's how the sordid scheme allegedly unfolded. House was loaned $1 million, interest free, by a man named Lloyd Gillespie to purchase the car. The insurance company says that House and Gillespie were aiming to double the investment by destroying the multi-million dollar car.
S&P may cut France rating outlook - (www.reuters.com)
Central Banks Pushed to Act on Funding Squeeze - (www.bloomberg.com)
Fed, ECB offer aid for global financial system – (money.cnn.com)
Preliminary Reports Offer Contradictory Views on November Jobs - (finance.yahoo.com)
U.S. Rating Outlook Cut to Negative by Fitch - (www.bloomberg.com)
Record Black Friday sales? Don't get too excited - (money.cnn.com)
Crisis in Europe tightens credit across the globe - (www.nytimes.com)
No comments:
Post a Comment