FHA Swamped By Defaults; Congressional Report Shows FHA Could Suffer Losses as High as $115 Billion; Shut Down Fannie, Freddie, FHA - (globaleconomicanalysis.blogspot.com) The Federal Housing Administration's (FHA) losses over the next 30 years could be much higher than originally projected, according to the findings of a congressional committee. The dismal forecast has some bracing for another taxpayer-financed bailout. The House Oversight and Government Reform Committee, chaired by Rep. Darrell Issa (R-Calif.) is reporting that a worst-case scenario stress test conducted last year estimated the FHA could suffer losses as high as $115 billion. That forecast is significantly worse than the one reported by independent auditor Integrated Financial Engineering Inc., which projected losses of $65 billion for the 79-year old agency. Swamped by Defaults: The primary cause of the FHA's troubles is the plague of underwater mortgages that has struck the housing sector in recent years. During the late housing bubble, the FHA lost market share as more private lenders sold “subprime” loans to home buyers. But with the collapse of the housing market in 2007-08, much of that business returned to the FHA. While the agency has played a major role in propping up home prices, it has also been overwhelmed by defaults.
Why
Are California's Businesses Disappearing? - (www.bloomberg.com) There
were 1.3 million businesses in California at the end of 2012, 5.2 percent fewer
than in the previous year (that’s about 73,000 fewer). To put that in
perspective, Massachusetts lost 5,200 businesses, the second-highest amount,
and Kansas had 3.1 percent fewer businesses in 2012 than in 2011, the
second-highest loss rate. Nebraska added businesses at 11.9 percent, the
fastest rate. Because BLS releases the data on a lag, the end of 2012 is the latest
date for which numbers are available. What gives? “It’s more likely the
disappearance of a number of businesses than it is businesses leaving
California,” says Kevin Klowden, an economist at the Milken Institute’s
California Center. The state was hard hit by the Great Recession, Klowden continues,
and businesses may still be shuttering in a hangover from tougher economic
times. It could also be the case of animproving job market
luring entrepreneurs of necessity away from their businesses, a trend that’s
shown up in national data on new business starts.
Portugal
president warns of failure to return to markets - (www.reuters.com) Portugal's
president warned on Friday that a negative scenario for the country would be if
it failed to return to markets as
planned in 2014 due to external events or internal politics. "The
incapacity of returning to the markets in
2014 could even be a result of the troika not being ready to sign off in a
positive way on the rescue package," President Anibal Cavaco Silva told a
conference. Analysts have warned that a political crisis that hit the country
this week could upset the smooth progress of Lisbon's adjustment program under
a 78-billion-euro bailout by the European Union and IMF.
China
Declares War on French Wine - (globaleconomicanalysis.blogspot.com) In
retaliation for ridiculous EU tariffs on solar panels (sponsored mainly by
France over the objections of Germany) China Declares War On Wine.
Via Mish-modified Google translate from El Economista ... The Chinese government has decided to launch an investigation into the European wine sector with the later intention to apply a punitive tax if necessary, as China authorities accuse wine producers in the European Union (EU) of unfair trade tactics such as dumping and subsidies. The temporary imposition of a tariff on Chinese solar panels by the EU started a trade war whose greatest victim is wine. "This is a thorough research on European wines for export, in all formats, is bottled in barrels or in bulk," say sources familiar with the process, which warned that the wineries are going to have to face a complicated process and urgent administrative that could derail Asian exports. And that is bad news for an industry whose sales in their home markets is already complicated by the financial crisis.
Via Mish-modified Google translate from El Economista ... The Chinese government has decided to launch an investigation into the European wine sector with the later intention to apply a punitive tax if necessary, as China authorities accuse wine producers in the European Union (EU) of unfair trade tactics such as dumping and subsidies. The temporary imposition of a tariff on Chinese solar panels by the EU started a trade war whose greatest victim is wine. "This is a thorough research on European wines for export, in all formats, is bottled in barrels or in bulk," say sources familiar with the process, which warned that the wineries are going to have to face a complicated process and urgent administrative that could derail Asian exports. And that is bad news for an industry whose sales in their home markets is already complicated by the financial crisis.
'Blaming landlords for housing crisis like blaming pubs for drink problems' - (www.telegraph.co.uk) Britain's growing army of private landlords is facing another barrage of criticism, this time from London-based policy think tank the Strategic Society Centre. Its lengthy report - "Understanding Landlords" - draws on existing housing data and new material to analyse the profile of people buying-to-let. "Private rented sector landlords have, on average, a more advantaged background," the report concludes, finding three quarters of landlords are aged 45-64, 40pc have a degree or higher qualification, and 34pc live in London or the South East. The report comes alongside calls from the organisation to limit landlord activity. It wants to see a "new-build buy-to-let mortatorium," for instance, whereby newly-built properties could not be bought with buy-to-let loans "for the forseeable future". It says the Government should also "review wider financial incentives and returns available to private landlords". The report, which has been widely publicised, chimes with other vocal critics of the private rented sector, which is expanding rapidly. Pricedout.org.uk, for example, a lobby group representing younger, aspirant homeowners, has called for landlords to be stripped of their right to offset mortgage interest against tax as a business expense.
China
Admits Local Govt Debt Levels Unknown, Could Be Higher Than Estimated - (www.reuters.com)
China Enters Nomura Danger Zone as Fed Tapers: Cutting Research - (www.bloomberg.com)
China Enters Nomura Danger Zone as Fed Tapers: Cutting Research - (www.bloomberg.com)
Delayed employer mandate the latest change for
increasingly unsteady health-care law - (www.washingtonpost.com)
Federal Reserve Board approves rules requiring banks to
set aside more capital - (www.washingtonpost.com)
No comments:
Post a Comment