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Faulty Loans Top $72 Billion as Banks Seek Deal With Regulators - (www.bloomberg.com) Costs from faulty mortgages and shoddy foreclosures have topped $72 billion at the biggest U.S. banks as they near a settlement of a 50-state probe into the industry’s practices. Wells Fargo & Co., Bank of America Corp., Citigroup (C) Inc., JPMorgan Chase & Co. and Ally Financial Inc., the five largest home lenders during the real estate boom, tallied at least $6.78 billion in new costs tied to mortgages during the second half of 2011, according to data compiled by Bloomberg. Bank of America, ranked second among U.S. banks by assets, contributes $41.8 billion of the overall total. The mounting costs are pushing lenders and regulators to resolve investigations and lawsuits over faulty home lending, including a 50-state review of foreclosures. The wrangling over the status of old loans has made some banks more reluctant to make new ones, even as Federal Reserve Chairman Ben S. Bernanke appeals for action to increase lending and fix the U.S. housing market because it’s a drag on the economic recovery.
States With Highest Foreclosure Rates Among Accord Holdouts - (www.bloomberg.com) California, New York, Nevada, Florida and Massachusetts are among the states that haven’t signed off on a settlement with banks over foreclosure abuses, according to state officials and two people familiar with the talks. The holdouts include some with the highest rates of foreclosures. More than 6 percent of Nevada housing units had at least one foreclosure filing in 2011, the nation’s highest rate, according to RealtyTrac. California was third-highest with more than 3 percent, said the firm, which tracks foreclosures. California Attorney General Kamala Harris and New York Attorney General Eric Schneiderman, who have been among the most outspoken in pushing for changes to the accord, were among those who hadn’t joined as of a Feb. 6 deadline. More than 40 states signed on, said Iowa Attorney General Tom Miller, who is helping to lead talks with the banks.
John Paulson Totally Flipped Out During A Conference Call Today - (www.businessinsider.com) Well, the stock of the company did go up nearly 10% after. Imagine the surprise Liam McGree, CEO of Connecticut insurance firm The Hartford, had this morning when John Paulson decided to take the place of his analyst and to give the executive a piece of his mind on the company's Q4 earnings call. Paulson & Co. is a majority shareholder at The Hartford, owning about 9 percent of the company. So it doesn't help that like Paulson, Hartford did not have a happy 2011—the company's stock declined over 39 percent last year.
This Teamsters Memo Shows How The Threat Of A Union Strike Could Seal Hostess' Fate - (www.businessinsider.com) The growing bankruptcy battle between Hostess management and its 19,000 employees could come to a head next month when a bankruptcy judge rules on the company's request to scrap its current employee contracts. Leadership at the International Brotherhood of Teamsters, which represents the majority of Hostess employees, have asked their membership to authorize a potential strike if the judge grants the company's request, according to a memo sent to us by a current employee. Hostess management have said that replacing the current employee contracts with new cheaper ones is the only way that the battered company will be able to come out of bankruptcy. But union officials are calling Hostess's demands — which include a five-year wage freeze and scrapping employer contributions to health and pension plans — unreasonable, according to the memo. This latest development does not bode well for the future of this once-iconic company, best known for Twinkies and Wonder Bread. Management claims they need these concessions to cut labor costs, but if the court approves the new contracts and employees go on strike, replacing employees would create a whole new set of costs in order to continue operations. Union officials acknowledge this tension in the memo, writing that a strike "would almost certainly put Hostess Brands out of business and cost thousands of jobs."
German Exports Slump Faster Than Forecast as Crisis Damps Growth: Economy - (www.bloomberg.com)
China May ‘Move Shortly’ on Aid for Europe, Academic Says - (www.bloomberg.com)
Bernanke-Led Economy Proving Critics Clueless About Federal Reserve Policy - (www.bloomberg.com)
U.S. Consumer Credit Climbed by $19.3B in Dec - (www.bloomberg.com)
U.S. Job Openings Rise by Most in Almost a Year in Recovery Sign: Economy - (www.bloomberg.com)
Nokia Shifting Assembly to Asia With Loss of 4,000 Jobs in Europe, Mexico - (www.bloomberg.com)
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