TOP
STORIES:
Fed's 2007 crisis response: Hope and Twinkies - (www.washingtonpost.com) During the Aug. 16
videoconference, when the Fed elected to cut the discount rate for bank
lending, Richmond Fed President Jeffrey Lacker suggested that Timothy Geithner,
then the New York Fed president, may have allowed word of the impending rate
cut to leak to one leading bank. That set up a tense exchange between the two
officials. Geithner said that the banks “obviously don’t have any idea that
we’re contemplating a change in policy or what might be possible and what we
might say or not say going forward.” Lacker said, “Vice Chairman Geithner, did
you say that they [the banks] are unaware of what we’re considering or what we
might be doing with the discount rate?” “Yes,” replied Geithner. Continued
Lacker: “Vice Chairman Geithner, I spoke with Ken Lewis, President and CEO of
Bank of America, this afternoon, and he said that he appreciated what Tim
Geithner was arranging by way of changes in the discount facility. So my
information is different from that.”
New
mortgage regulations will prevent future housing bubbles - (www.ochousingnews.com) Last week I wrote about How the new mortgage rules will impact the housing
market. Since then, even more regulations were announced. After
thinking about the ramifications of these new regulations over the last week, I
am surprisingly relieved by what I see. I think these new regulations really
will prevent future housing bubbles. With any regulation, there is fear that it
will either be changed or enforcement will be lax. While it’s still possible
future generations may forget the folly of the last decade, it’s unlikely our
generation will. These new regulations are here to stay. A far larger concern
is the lack of enforcement and oversight. And if the issue were left up to the
agencies or the federal reserve, that would still be a big concern, but that’s
not where enforcement will come from. Civil lawsuits from future loanowners
decrying their inability to repay the loans is what will keep lenders in line.
World Unemployment to Hit Record High in 2013 - (www.cnbc.com) World unemployment could
top record levels this year and continue rising until 2017, the International
Labour Organization (ILO) said on Tuesday in its annual employment report. 2009
currently stands as the worst recorded year for world unemployment, with 198
million people across the globe without work. In its 2013 Global Employment
Trends report, the ILO forecasts unemployment numbers will rise by 5.1 million
in 2013 to reach 202 million, topping 2009's record. The report also predicts
unemployment will rise further in 2014 to reach 205 million. "Unemployment
remains as dire as it was during the crisis in 2009," Ekkehard Ernst,
chief of the employment trends unit at the ILO, which wrote the report, told
CNBC.
When
someone figures out the RE market,let me know. - (www.businessinsider.com) 1.4 million borrowers moved
to positive equity (where homeowners owe less on
their mortgage than their home is worth) in the year through the end of
Q3. This is according to CoreLogic's latest negative equity report. But a
whopping 10.7 million or 22 percent of all residential properties with mortgages
were underwater by the end of Q3. "The substantive gain in house prices made in 2012, partly due to
tight inventory caused by negative equity’s lock-out effect, has paradoxically
alleviated some of the pain," Mark Fleming, chief economist for CoreLogic
said in a press release. We drew on CoreLogic's report to highlight the 12 states
that are deepest in negative equity. We ordered them based on the number of
underwater mortgages as a share of total mortgages (i.e. negative equity
share).
Last debt ceiling debate indicates more economic hurt likely as another fight looms - (www.washingtonpost.com) As Washington debates whether to raise the limit on government borrowing, an earlier conflict over the debt ceiling offers a cautionary tale about how brinksmanship can damage the economy. The U.S. economic recovery was chugging along in the summer of 2011 when a partisan fight broke out over whether Congress would raise the federal debt limit and avoid a national default. The protracted, unsettling nature of the negotiations between the White House and Republicans dramatically slowed the recovery, economists conclude, looking back at the episode. Consumer confidence collapsed, reaching its worst level since the depths of the financial crisis. Hiring stalled, with the private sector creating jobs at its slowest pace since the economy exited the recession. The stock market plunged, sending the Standard & Poor’s 500-stock index down more than 10 percent.
No comments:
Post a Comment