KeNo's Housing and Economic Portal: Wednesday January 4 2016 Housing and Economic stories

Tuesday, January 3, 2017

Wednesday January 4 2016 Housing and Economic stories

Deflating Manhattan Housing Bubble Hits Amy Schumer - (www.wolfstreet.com) The demise of the Manhattan house price bubble has a new and beloved for-instance. Standup comedian and actress Amy Schumer is a total hoot on stage. And she’s a raging success. So it would have been nice if she could have made some money on her Manhattan co-op that was billed as a “penthouse.” But it looks like she ended up in the hole. Manhattanites, even funny ones, are now once again finding out, along with home sellers in certain other trophy cities, that “you can’t lose money in real estate” – until you do. Her 850-square-foot 1-bedroom apartment occupying the entire top floor of a historic 20-foot wide townhouse – so this is not exactly a palace – at 129 West 80th Street near the Museum of Natural History went into contract on December 23, as reported today by Dow Jones unit Mansion Global: The “Trainwreck” star has been trying to unload the home for over a year, first listing the one-bedroom, one-and-a-half bathroom unit with Compass for $2.075 million. She’s since cut the price multiple times. It was most recently selling for $1.625 million, according to a listing by the Modlin Group. The asking price was last slashed in August to $1.625 million. So after more than a year of trying, and after the asking price has been cut by nearly 22%, she was able to unload it.

Deutsche Bank Flew and Fell. Some Paid a High Price. - (www.nytimes.com) In 2005, Deutsche Bank, then a powerhouse in the selling of risky derivatives on a global scale, was minting money. To mark the moment, the bank’s profit engine — its global markets division — commissioned a book about itself. The remembrance would celebrate how Deutsche Bank, once a sleepy lender to German car companies, had transformed itself in just 10 years into a force in financial engineering, selling interest-rate swaps, credit derivatives and opaque tax-slashing investment vehicles to the world’s wealthy elite. In the view of one senior executive, it all came down to masterly salesmanship by a single man, Anshu Jain, the chief promoter of the bank’s hottest product: risk. Today, these words read more like an epitaph than a commemoration. On Dec. 22, the bank agreed to pay $7.2 billion to settle a claim with the Justice Department that it pushed toxic mortgages on investors in the years leading up to the American housing bust.

Senate Begins Process To Repeal Obamacare – (www.zerohedge.com) Now, before he's even taken office, the Senate has started preparations for a repeal of Obama's single crowning piece of legislation, the Affordable Care Act. Moments ago, the Senate Budget Committee Chairman Mike Enzi released a 2017 budget resolution setting up the process to partially repeal Obamacare early in President-elect Donald Trump’s administration. The Senate will consider the bare-bones budget on the floor starting this week with votes expected next week. Once the House and Senate agree on a resolution a reconciliation bill repealing parts of Obamacare could proceed. Of course, using the reconciliation process allows Republicans to avoid a Democratic filibuster in the Senate which is the same process that Democrats used to pass the controversial legislation in the first place. This news follows a pair of tweets from Trump earlier this morning declaring that "Obamacare just doesn't work."

Bank Bailout Balloons, Tab for Italian Banking Crisis Soars - (www.wolfstreet.com) Over the Christmas holidays, when no one was supposed to pay attention, and when the markets were closed, the bailout costs of Monte dei Paschi di Siena, the third largest bank in Italy, and the center of the Italian banking crisis, suddenly jumped by 75% to €8.8 billion ($9.2 billion)! Just how immense the black hole inside of a bank really is remains unknown until the bank collapses entirely and the pieces are sorted out. No one wants to know, especially not bank regulators. But when banks are teetering, and a bank bailout, or rather a bondholder bailout is being discussed, the aspects of that hole begin to emerge, and the hole keeps getting bigger the longer someone looks at it.

Potential new banking crises are a concern in Europe: Analyst - (www.cnbc.com) While the first days of the 2008 financial crisis are long gone, the large level of bad loans continues to be a drag on the European banking system and could spark new crises in the coming year, an analyst told CNBC. Investors are currently focusing on the recapitalization process at the oldest lender in the world, the Italian Monte dei Paschi, which is set to become a template for how the rest of the Italian banking system can be overhauled. But, given that Italy is not the only EU country with high bad loans in banks' balance sheets, analysts are worried that further banking crisis will emerge in Europe.

OTHER STORIES: