Thursday May 28 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

Jeff Walser, FDIC Economist, Charged With Attempted Bank Robbery - (www.huffingtonpost.com) An economist on leave from the federal agency that insures bank deposits has been charged with the April 11 attempted robbery of a Kansas City-area bank. Jeff Walser said he had a bomb in his briefcase and demanded money at the Bank of America branch in Independence, but did not take $41,000 brought to him by an employee, according to an indictment filed Tuesday. Walser, 51, surrendered to police and was being held in federal custody, the U.S. attorney's office said. Walser told police that he has health problems and was "alone, discouraged and tired of working" and that his plan was to be arrested and not tell police he required thrice-weekly dialysis treatments to survive.

FBI Probes Possible Insider trading by SEC Lawyers - (www.cnbc.com) Federal prosecutors and the FBI have been investigating possible illegal insider trading by two Securities and Exchange Commission enforcement attorneys who were in a position to receive sensitive information about agency probes of public companies. The SEC's inspector general, David Kotz, found that the frequent stock trades over a two-year period by the pair raised suspicions of insider trading. Earlier this year, he referred the matter to the Fraud and Public Corruption Section of the U.S. attorney's office in Washington. That office, together with the FBI, "is conducting an investigation of possible criminal and civil violations," Kotz told SEC Chairman Mary Schapiro in a memo dated March 3. The memo and Kotz's report of his investigation were provided by the office of Sen. Charles Grassley, R-Iowa, who has been an active critic of the SEC's operations. Kotz's report also found that the SEC "has essentially no compliance system in place to ensure that ... employees, with the tremendous amount of nonpublic information they have at their disposal, do not engage in insider trading themselves." The agency's disclosure and compliance requirements is based on the honor system and there is no way to determine whether an employee fails to report a transaction. "We take seriously even the suggestion that any SEC employee would engage in insider trading," according to a statement from the agency.

NAR Shovels Shit To The Press - (www.nypost.com) WHO the hell would be stupid enough to pay to hear Alan Greenspan's opinion of anything! Notice, that isn't a question because I already know the answer. Rather, it's a statement with one of those exclamation points to show that my voice is being raised in a mix of bewilderment and anger. The National Association of Realtors, which is probably suffering from combat fatigue, asked the former Federal Reserve chairman and the chief suspect in the destruction of the US economy, to address its Washington conference Tuesday and tell real estate people what they want to hear -- that things are getting better. So Greenspan did just that. "We are finally beginning to see the seeds of a bottoming" in the housing industry, Greenspan told the gathering. Adding, according to Bloomberg News, that the US is "at the edge of a major liquidation" in the stock of unsold houses. Applause, applause. Here's your check, Alan. I figured it was worth knowing how much Greenspan gets these days for defending his own indefensible actions at the Fed while also trying to pull the wool over the eyes of would-be homeowners. So I asked someone named Lucien Salvant, managing director of the NAR's public affairs department. His answer in an e-mail: "None of your business. How much is the NY Post paying you to ask that question?" Whoa! Calm down, Lucien. Most p.r. people know better than to pick a fight with the press, especially when they don't know whether the media guy asking the question is an SOB who'll print the nasty response verbatim in a column that would have otherwise been pretty harmless. Now? Well, Lucien got my blood stirred. The fact is that The Post paid me nothing, per se, to ask that specific question. I was just sitting around on Tuesday watching the wire services when Greenspan's speech came out. Then stories followed saying how the stock market was reacting favorably to news that Greenspan had said the same thing he always says.

Barney Frank is a Genius -- Not - (www.freedompatrol.blogspotcom) Barney Frank is my personal hero. His latest crusade is one of his most admirable yet. He has determined that municipalities are paying too high an interest premium to borrow debt and that he Barney Frank is going to save them by reducing their borrowing costs. I'm not quite sure what it means when he says that rates are too high. I assume he doesn't like the way the free market works and is unhappy with the actual numerical interest rate municipalities are paying. I'm sure he is right too. Municipalities are being screwed. After all, everyone knows the private market has a vendetta against these municipalities and the fact that they are paying unfairly high rates has nothing at all to do with the fact that they are massively insolvent and therefore huge credit risks. But this is why Mr. Frank is so amazing and is my personal hero. He is able to act with 100% confidence without anything at all resembling logic. He, Barney Frank, hero of the people, is going to lower the cost to municipalities so all the corrupt, inefficient payments to his voting constituents can continue unabated. Now how is he going to do this you ask? How is he going to somehow magically lower costs without any unintended consequences? Well this is why Barney Frank is my hero and you are not. You are a skeptic who doubts the power of the almighty one. Just believe. Don't question. God knows you will be happier. Of course if you, like me, are still skeptical I'll give you the answer. He can't. He is a buffoon who has no idea what he is doing but views himself as a Messiah - a savior of those who can't defend themselves.

Cities to be beautified by shutdown of auto dealerships - (www.latimes.com) A wave of closures by GM and Chrysler is likely to leave many car lots sitting empty. Dozens of cities also depend on sales tax revenue from the dealerships to balance their budgets. With struggling automakers expected to announce the shutdown of thousands of dealerships starting today, cities are bracing for a wave of blight. The closings will dump thousands of large, oddly configured parcels into an already reeling commercial real estate market. Many are likely to remain empty for a long time, monuments to the decline of the U.S. auto industry and the intensity of this recession. Chrysler told a Bankruptcy Court today that it will break its contracts with 789 dealerships nationwide. General Motors Corp. will tell 1,000 to 1,200 dealers Friday that it will not renew their franchises. The automaker plans to eventually close a total of 2,600 operations. In California, the moves will have far-reaching implications for dozens of cities, which depend on sales tax revenue from the dealerships to fund substantial portions of their budgets. The dealerships join a growing list of retailers felled by the dour economy: Sites that once held Mervyn's, Circuit City and Linens 'n Things stores remain empty except for a few locations. And as difficult as it has been to sell or lease those properties, at least they can be easily adapted for other uses. Car dealerships, on the other hand, are special-purpose properties that are hard to adapt. "There are not a lot of uses that can go right back into a dealership," said Jodi Meade, director of the automotive properties group at real estate brokerage CB Richard Ellis. "Usually they have to scrape it" and start over to make way for another business. San Bernardino, for example, had 12 dealerships when the economy was booming. Now there are just seven -- and it's unclear whether more will be felled with the GM and Chrysler announcements. At an abandoned Cadillac dealership, weeds poke through cracks in the asphalt. Vandals have painted graffiti over the Chevrolet logo at another site. Windows are broken and dead grass from a once-tended lawn covers the ground. One of the car lots, now called Arrowhead Motors, is operating only because a credit union had so many repossessed vehicles that it decided to go into the auto business. "The whole model of auto sales through dealership networks is open to question," said Jim Morris, chief of staff to San Bernardino Mayor Patrick J. Morris. Finding a car seller for the Arrowhead Motors site was a coup for the city, which is struggling to figure out what to do with its empty car lots, Jim Morris said. Auto dealership sites have lost a third to half of their value compared with the peak about three years ago, Meade said.

Menlo Park Real Estate In Distress - (www.patrick.net) Wow, I was biking by and saw THREE houses for sale right near each other in a really rich neighborhood in Menlo Park. Here’s a photo: I think these are the listings, which of course each fail to mention that the neighbors are trying to sell at the same time: http://www.redfin.com/CA/Menlo-Park/800-Hermosa-Way-94025/home/890061; http://www.redfin.com/CA/Menlo-Park/866-Hermosa-Way-94025/home/1601197; http://www.realtor.com/realestateandhomes-detail/829-Hermosa-Wy_Menlo-Park_CA_94025_1107844310; One house for sale is normal. Two houses next to each other for sale is a bit odd. Three houses for sale by each other is an indication that the market is seriously hurting. There is no way each of them are going to get $3 to $4 million. I bet we have greater than 50% reductions in Menlo Park coming soon. It would be a disaster to buy at these prices when there is so much on the market, and more coming up for sale all the time. Just think, a buyer could easily lose a million dollars in the next year alone!

Most US houseowners still disconnected from reality - (www.reuters.com) Most American homeowners believe their home's value has declined over the past year, but a majority also think a bottom has been reached, real estate website Zillow.com said on Thursday. A majority, or 60 percent, believe their home lost value during the past 12 months, according to the Zillow Q1 Homeowner Confidence Survey. In reality, 80 percent of homes across the country lost value during the past 12 months, according to Zillow's first-quarter Real Estate Market Reports. Additionally, 18 percent believe their home gained value in the past 12 months, and 22 percent believe its value remained the same, according to the survey. That resulted in a Zillow Home Value Misperception Index of five -- the lowest it has been since Zillow introduced the index in the second quarter of 2008 and down from 10 in the fourth quarter of 2008. A Misperception Index of zero would mean homeowners perceptions' were in line with actual values. "The perception of American homeowners is finally catching up to reality, which is that 80 percent of all homes in the country lost value during this past year," Dr. Stan Humphries, Zillow's vice president of data and analytics, said in a statement accompanying the survey. "While homeowners are now more realistic when looking backward, they are still pretty starry-eyed when looking forward, with three out of four homeowners believing that their own homes' prices will increase or be flat over the next six months. Unfortunately, there are few markets we expect to perform this well," he said. Most homeowners -- 74 percent -- believe their home will not decline in value in the coming six months, effectively calling a bottom to their own home's housing slide, Zillow said. Specifically, one in four homeowners, or 27 percent, think their home's value will increase in the next six months, while nearly half, or 47 percent, believe its value will remain the same. Homeowners were similarly optimistic when it came to predicting home values in their local markets, the survey showed. About two-thirds of homeowners believe home values in their local markets will increase or stay the same, at 26 percent and 37 percent respectively, over the next six months. Thirty-seven percent believe home values will decrease, the survey showed. It also showed a significant number of potential sellers are holding back due to the current market. When asked about future plans to sell, 31 percent of homeowners said they would be at least "somewhat likely" to put their homes on the market in the next 12 months if they saw signs of a real estate market turnaround, the survey showed. "Also interesting is the information we have for the first time this quarter on the levels of 'shadow inventory' - homes that people would like to sell but that aren't currently on the market, and thus aren't captured in the official number of homes on the market," said Humphries. "With almost a third of homeowners poised to jump into the market at the first sign of stabilization, this could create a steady stream of new inventory adding to already record-high inventory levels, thus keeping downward pressure on home prices." With a Misperception Index of 2 -- down from 13 in the fourth quarter -- the perception of homeowners in the West was closest to reality, along with that of homeowners in the Midwest. Northeastern homeowners' perception of their own homes' values was the farthest from reality, with a Misperception Index of 11, up from 3 in the fourth quarter, the survey showed.




OTHER STORIES:

Suburban Housing Markets Are Unsustainable - (www.seekingalpha.com)
Decoupling From Reality - (www.jameshowardkunstler.typepad.com)
The Problem with Debt: Leverage - (www.finance.yahoo.com)
Foreclose and Work the System - (www.blog.youwalkaway.com)
Commercial Rents Crashing in London to 1991 Prices - (www.bloomberg.com)
Small-business credit card rates increase - (www.jan.freedomblogging.com)

On the road with the Airpod air-powered car - (www.guardian.co.uk)
SEC recommends civil fraud charges against Mozilo of Countrywide - (www.latimes.com)
Government Underestimates Fannie, Freddie Money Pits - (www.seekingalpha.com)
California treasurer requests TARP help - (www.marketwatch.com)
Economic-Stimulus Cash Is Moving Slowly - (www.online.wsj.com)
Geithner enriches speculators in "sham" bank bail-outs - (www.telegraph.co.uk)
Author Thomas Woods talking about the Fed - (www.booktv.org)

Stanford Investors 'Shocked' by $20 Million Fee Request - (www.cnbc.com)
Volkswagen Halts Talks with Porsche on Tie-Up - (www.cnbc.com)
Price of Gasoline Jumps 25 Cents in 3 Weeks - (www.cnbc.com)
Two Of The World's Richest Men Game Market - (www.cnbc.com)
Week's Top Videos: Dr. Doom, Otellini, Cohen & More - (www.cnbc.com)
Buffett's Berkshire Boosts Stakes in J&J, Wells Fargo - (www.cnbc.com)
Economic Recovery Still Months Away: Roubini, Rogoff - (www.cnbc.com)

Monday May 11 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

YouTube - VICTORVILLE MODEL HOMES DEMOLISHED - SHOCKING VIDEO: Part 5 - (www.youtube.com) The housing collapse is taking a literal form for one bankrupt housing development. Four model homes and 12 nearly finished spec homes at Bear Valley Road and Highway 395 are being demolished. The developer filed bankruptcy about 18 months ago and the foreclosed property went to Guaranty Bank in Irvine. A Guaranty Bank official, Real Estate Officer Dean Smith, said they were facing daily fines from the city of Victorville if they didn’t do something with the homes and property that not up to code. He said it was a choice of pumping their own money into property site improvements and additional money to bring the home up to code or tear down the 16 homes. Smith said the bank is not in the building or land development business and because of the current housing market does not see anything happening with the property for at least five years. Our only option is to either proceed with putting more than a million bucks into the land, which we've already taken a huge hit on and lost a lot of money, or, we tear down the houses, Smith said. He said the builder put up the homes before completing the site improvements and failed to have enough money to finish roads, walls, and other improvements that bring the community into code. Everything just fell apart at that point and we can’t sell homes that are not up to code, Smith said. He said the city of Victorville fined the bank once because the home are out of code and would have faced daily fines if Guaranty didn't do something with the vacant houses. There are still substantial dollars that need to be put into the land before the city of Victorville will give certificates of occupancy on the houses and the bank isn't willing to put forward that amount of money, Smith said. He said the homes are a liability to Guaranty and that all of them are heavily vandalized inside and out with broken glass everywhere. Our projections are that those houses would sit the way they are for at least five years, what would they be worth then? Smith said. He said once the homes are demolished the property will be put on the market again. Calls to the developer were not returned.

SHOCKING: EXTREME HOME MAKEOVER-DEPRESSION EDITION PART 4 - (www.youtube.com) Guaranty Banks Holding Corporation received guess what? TARP money, that’s right, YOU the tax payer paid for the demo. When you think of all the people currently living in tent cities in southern cali - it's disgraceful. Those houses are large enough to hold 2 families at least. I guess some bureaucracy decided they had to get their piece of the TARP bailout by assessing code violations against the bank after they took over... wonder if it was for not filing the right paperwork, or not completing within permit period, or lack of landscaping, or what. I'm sure they came up with all kinds of stuff to try to pull some money into their budget. Backfired, didn't it. And what a waste.

Rep. Barney Frank in 2005: What Housing Bubble? - (www.youtube.com) A speech by Barney Frank on the House Floor in 2005 where he refutes any concern about a housing industry bubble and advocates for the government to continuing expanding home ownership. Scary that this is coming from House Financial Services Committee Chairman Barney Frank. Frank. This guy proves he can’t be trusted to run the financial services committee and should not even be allowed to stay in office. In 1990, The House Ethics Committee recommended Frank be reprimanded because he "reflected discredit upon the House" by using his congressional office to fix 33 of Steve Gobie's parking tickets. Frank confirmed that he paid Gobie for sex, hired him with personal funds as an aide and wrote letters on congressional stationery on his behalf to Virginia probation officials, but Frank said he fired Gobie when he learned that prostitution clients were visiting the apartment.

Sen. Dick Durbin: Banks Frankly Own The Senate - (www.huffingtonpost.com) Sen. Dick Durbin (D-Ill.) has been battling the banks the last few weeks in an effort to get 60 votes lined up for bankruptcy reform. He's losing. On Monday night in an interview with a radio host back home, he came to a stark conclusion: the banks own the Senate. "And the banks -- hard to believe in a time when we're facing a banking crisis that many of the banks created -- are still the most powerful lobby on Capitol Hill. And they frankly own the place," he said on WJJG 1530 AM's "Mornings with Ray Hanania." Progress Illinois picked up the quote.

Paycheck: $80,000. Hours working: 0 - (money.cnn.com) Some large law firms are putting their incoming associates on hold until the economy picks up, in return for a stipend of up to $80,000. As many Americans are struggling to find a job, some are getting paid as much as $80,000 a year not to work. A number of third-year law students on the brink of graduation are being asked by their future employers to stay home for now - with pay. Over 100 large firms, or firms with 200 or more attorneys, have delayed the start date for at least a portion of their incoming first-year associates, according to Above the Law, a blog covering the legal industry. The majority of those firms have delayed start dates into 2010, and provided some financial assistance to those on standby, Above the Law said, a move that doesn't come cheap. Some students have been offered hefty stipends of up to $80,000, and even full benefits in some cases.

Auto sales plunge to near 30-year lows - (www.reuters.com) U.S. auto sales fell 34.4 percent in April as the industry held near the lowest levels in nearly 30 years and closed out the month with Chrysler LLC filing for bankruptcy protection. The talk of bankruptcy surrounding Chrysler and General Motors Corp, which faces similar pressures, only spooked consumers last month and led to weaker-than-expected industry results, executives and analysts said. "Clearly, the uncertainty, the bankruptcy talk, has really affected the entire industry," GM chief sales analyst Mike DiGiovanni said on a conference call, adding retail sales had hit a wall in the last week of April. U.S. auto sales came in at a 9.32 million seasonally adjusted annual rate in April, according to Autodata Corp, below the 9.8 million rate that analysts had expected. The annualized rate of U.S. auto sales is a closely watched indicator of economic activity. That marked the 18th consecutive month of year-over-year declining sales and a drop from 9.86 million in March.

Desperate car dealers get useless loans - (money.cnn.com) Starting early next week, larger businesses will temporarily be eligible to apply for loans backed by the Small Business Administration, a move aimed at getting help to besieged auto dealers and industry suppliers. Through September 2010, the SBA will raise the size standard of what counts as a "small" business, allowing slightly bigger companies to participate in its flagship 7(a) lending program. Typically, auto dealers haven't qualified for the program because most have annual sales in excess of $29 million, the SBA's cap for that industry. But from now through the end of the 2010 fiscal year, the SBA will disregard the revenue cap and use other criteria for eligibility. Companies with less than $3 million in annual income and a net worth of less than $8.5 million will qualify for the loans. Though this new criteria is aimed at auto dealerships, the SBA anticipates that more than 70,000 small businesses nationwide from a variety of industries will now qualify for its 7(a) loans. But it's not clear whether the new eligibility rules will actually make significant new financing available for auto businesses in need. There are a few hitches. First, auto dealerships typically rely for their financing needs on automotive financing entities such as Ford Motor Credit Corporation, General Motors Acceptance Corporation (GMAC) and Chrysler Financial. None of the major automotive financiers are currently on the list of lenders certified by the SBA to make agency-backed loans. Also, the most common type of loan an auto dealership takes out is what's known as "floorplan" financing, which allows the dealer to borrow money to buy vehicles from a manufacturer and repay the loan as the cars sell. The SBA's 7(a) loans are strictly for working capital and can't be used for vehicle inventory financing. The National Automobile Dealers Association is lobbying President Obama's administration to lift that constraint.

Silverton Bank in Atlanta Seized by Regulator Amid Recession - (www.bloomberg.com) Banks in Georgia, New Jersey and Utah were seized by regulators today, boosting the tally of failed lenders in the U.S. this year to 32 and tapping more than $1.4 billion of the federal government’s deposit-insurance fund. Silverton Bank of Atlanta, a commercial bank, was shut by the Office of the Comptroller of the Currency. Citizens Community Bank in Ridgewood, New Jersey, and America West Bank of Layton, Utah, were seized by state regulators. The Federal Deposit Insurance Corp. was named receiver for all three. Silverton Bank is the largest failure since Downey Financial Corp. was shut in November at a cost to the FDIC of about $1.37 billion. The FDIC’s deposit-insurance fund, which is supported by fees on insured banks, plummeted 45 percent in the fourth quarter to $18.9 billion as 25 banks were closed in 2008. The U.S. economy contracted at a 6.1 percent annual rate from January through March, the weakest performance since 1957-1958. Silverton Bank didn’t take consumer deposits, the FDIC said today in a statement. It provided services to about 1,400 banks in 44 states. The FDIC set up a bridge bank to take over the operations of Silverton Bank, with about $4.1 billion in assets and $3.3 billion in deposits. The cost to the insurance fund related to Silverton bank was about $1.3 billion.

Extreme Home Makeover Depression Edition - (Mish at globaleconomicanalysis.blogspot.com) Inquiring minds are watching a pair of videos from Southern California. Allegedly, banks acquired brand new homes in foreclosure processes, the homes were not quite finished and the banks razed these homes rather than fix code violations. There you have it. Brand new nearly completed homes have a negative value because of regulations and are therefore destroyed.

A Laughably Late Conversion to the Cause of Fairness - (www.washingtonpost.com) There may be nothing more pathetic than a hedge-fund manager worked up in a moral lather, complaining that he hasn't been treated fairly. View Only Top Items in This Story
Since when did any of these guys ever worry about fairness? Certainly fairness was not an overriding concern of hedge-fund managers when they threatened to move even more of their operations to the Cayman Islands if forced to pay a regular tax rate on their exorbitant management fees. Nor do I recall receiving even a single e-mail from a hedge-fund manager complaining about how unfair it was that the government stepped in to bail out creditors and counterparties of Citigroup, Bear Stearns and AIG. But now that these hedgies are looking at the butt end of a government-imposed cramdown that would give them only 30 cents of each dollar owed by Chrysler, suddenly they're all about fairness and the rule of law. What you need to know about these vultures is that their idea of fairness is throwing 100,000 people out of work and denying retirees their pensions and their health benefits just so they can liquidate the company and maybe squeeze an extra 15 cents on the dollar from their Chrysler debt. Of course, to get that extra 15 cents, the hedge funds would probably have to fork over a penny or two to pay the army of $700-an-hour lawyers needed to spend two years working it through the bankruptcy process. Add to that another couple of cents for the battalion of $10-million-a-year investment bankers needed to sell the assets to the highest bidder. Meanwhile, every day that goes by, the value of those assets would decline a little more. And what exactly are these precious Chrysler assets that the hedge funds think would fetch them so much in liquidation? Aside from a few valuable brands, they're auto plants and machinery and large tracts of contaminated industrial land in some of the most economically depressed cities in the United States. No doubt folks would be lining up around the block for a chance to snatch up those babies.




OTHER STORIES:

Citi may need $10 billion more - report - (money.cnn.com)
Three more banks fail - (money.cnn.com)
Chrysler set to close four plants - (money.cnn.com)
Aftershocks to hit auto industry hard - (money.cnn.com)
Stocks rise on day, week - (money.cnn.com)
Bank stress test results delayed - (money.cnn.com)

It's still safe to bring home the bacon - (money.cnn.com)
Fast fixes to get your house sold - (money.cnn.com)
$10,000 deductible and other health cost woes - (money.cnn.com)

Treasuries Head for Sixth Weekly Loss as Economy Stabilizes - (www.bloomberg.com)
U.S. Stocks Gain on Improvement in Confidence, Manufacturing - (www.bloomberg.com)
Bank ‘Stress Test’ Results Due Next Thursday - (www.nytimes.com)
China's gold buy raises eyebrows for all the right reasons - (www.marketwatch.com)
Corporate Credit Markets Headed for Best Month Since December - (www.bloomberg.com)
Goodbye to Naked Shorting - (www.nytimes.com)
World Bank Bonds Show What Happens When Governments Rush Rescue - (www.bloomberg.com)
ADB plans $13bn boost to fight crisis - (www.ft.com)
Chinese Economy Gaining Steam - (www.businessweek.com)
India Exports Plunge by Record as Global Recession Hurts Demand - (www.bloomberg.com)

China Manufacturing Expands, Adding to Recovery Signs - (www.bloomberg.com)
Japan's jobless rate up, household spending down - (finance.yahoo.com)
U.S. Michigan Consumer Sentiment Index Rises to 65.1 - (www.bloomberg.com)
Carmakers' woes hitting state jobs, revenue - (www.sfgate.com)

In Chrysler Saga, Hedge Funds Cast As Prime Villain - (www.washingtonpost.com)
Chrysler U.S. Sales Fall 48%; Toyota Trails Estimates - (www.bloomberg.com)
After struggle, Chrysler succumbs to bankruptcy - (www.washingtonpost.com)
A Primer on a Chrysler Bankruptcy - (www.nytimes.com)

Wednesday July 30 Housing and Economic stories

Top Stories:

US Housing Prices Drop by Record 15.8% in May – (ap.google.com) A closely watched housing index shows home prices fell by the steepest rate ever in May, as the housing slump continued to deepen nationwide. The Standard & Poor's/Case-Shiller 20-city index, released Tuesday, is off 15.8 percent for May compared with a year ago, a record decline since its inception in 2000. The narrower 10-city index has fallen 16.9 percent, its biggest decline in its 21-year history.

Questionable religious tax exemptions for houses - (www.sun-sentinel.com) It's a remarkable home, even in an upscale Coral Springs neighborhood: 12,000 square feet, manicured grounds, a guest house, five-car garage and a pair of lion statues gracing the entrance. It's also tax-free. Owned by the Church of Bible Understanding in Philadelphia, the home and adjacent lot, valued at more than $3.2 million, are exempt from taxes on religious grounds. =Church representatives say they use the property to house missionaries working in Haiti and as a home for the church founder. The Broward County property appraiser granted the exemption in 2006, saving the church about $64,000 a year in taxes. In Broward, the value of properties considered tax-exempt for religious purposes totaled $1.8 billion in 2007, the last year for which complete data is available. While most were traditional churches and temples, the tax-free properties also included vacant land, parking lots and multimillion-dollar homes with golf course and water views, the South Florida Sun-Sentinel found.

Merril Unloads CDOs at .22 Cents on Dollar - (www.bloomberg.com) Merrill Lynch & Co. took the biggest step toward recovering from the worst financial disaster in its 94-year history by acknowledging that $30.6 billion of its holdings are worth barely a fifth of their original price and securing new capital amounting to a third of its market value. Merrill liquidated more than half of the mortgage-linked securities known as collateralized debt obligations that have saddled the company with $27 billion of write-downs since the beginning of 2007. To cushion the loss on the asset disposal, the firm raised $8.55 billion today by selling new shares for $22.50 each, 60 percent less than Merrill's stock price at the beginning of the year.

Fannie Mae's Political Immunity - (online.wsj.com) - President Bush is poised to sign the housing and Fannie Mae bailout bill, after the Senate passed it with 72 votes on the weekend. But an underreported part of this story is that Majority Leader Harry Reid refused to allow a vote on Republican Jim DeMint's amendment to bar political donations and lobbying by Fannie and its sibling, Freddie Mac

BBC: America's House Price Time Bomb - (news.bbc.co.uk) With the American housing market in its worst crisis since the Great Depression of the 1930s, President Bush is expected to sign into law a massive new government intervention designed to slow the slide.
The intervention would come as a little known quirk of US law threatens to drive down house prices even faster. Faced with seemingly never-ending falls in the value of their properties, some American home-owners are taking radical action; they are choosing to walk away from homes and their mortgages. In May 2006, at the height of the housing boom, Karen Trainer bought a $500,000 apartment in California - with money borrowed from her bank. By this year, Karen still owed $500,000 on her mortgage, but her apartment was worth $200,000 less. So she was deep in negative equity and, to make matters worse, the interest rate on her loan was about to increase. "I thought 'this is crazy'," Ms Trainer says. "It just does not make financial sense."

Lawmakers Now Pressing for Banks to Hide Losses Longer - (www.ml-implode.com) - The FASB is being pressured by the lawmakers to delay its time line on the revamped FAS 140 and FIN 46R. This of course help out the financial institutions by creating less transparency and delaying the inevitable probably due to a new tax payer bailout being drawn up that will channel more dollars to parties other than those who need it, the US citizens.

Frank calls for restructuring of the mortgage servicing industry if servicers fail to cooperate - (www.ml-implode.com) Frank’s message to servicers: Chairman Frank will hold a hearing in September to monitor the progress of loan modification by mortgage servicers.
Chairman Frank cautioned industry representatives: “I would hope that no one would be foreclosed upon between now and October 1st who would have qualified for this program had the effective date been immediate. And that is within your power to do. You can show some forbearance. October 1st is coming, begin the planning, begin the talking with people, but I think it would be a shame, an embarrassment to all of us if people were to lose their homes and the neighborhood deterioration were to be advanced and the economy would suffer because to satisfy CBO and other rules, we delayed this a couple of months. I earnestly hope that we can have that kind of cooperation.” Chairwoman Maxine Waters added, “As one who has focused on mortgage servicing from the outset of this crisis, I strongly support the Chairman’s call for forbearance until October 1st. It would be shameful for a single homeowner in California, or anywhere else hit hard by the foreclosure crisis, to lose their home if they could have been helped by this program but for this deadline.”

City to curb Fannie Mae, Freddie Mac investing - (www.paloaltoonline.com) As the mortgage crisis unfolds, the City of Palo Alto plans to stop purchasing Freddie Mac and Fannie Mae investments "until market confidence in these agencies returns."

No More Leases from Chrysler Financial - (www.woodtv.com) Leasing has been attractive in part because if the lessee doesn't opt to buy the vehicle at the end of the lease, the bank is responsible for selling it. And with the value of bigger vehicles falling, it can be a losing proposition for banks like Chrysler Financial. As an example, the lease on Appleberry's 2007 Chrysler Town & Country is just about up. The dealer said she would have to pay $17,000 to $18,000 to buy the vehicle at lease end. That number effectively represents what Chrysler believes it is owed after two years worth of payments. But if Chrysler tried to sell that vehicle at an auction, it is likely to get $11,500 or less, according to dealers - a loss of more than $5,000. "It does make sense for me when you put into a figure form," Appleberry said. "That doesn't make it easier for me."


Other Stories:

Consumer Confidence Hovers Near 16 Year Low - (www.bloomberg.com)
Our Empire of Debt is Collapsing - (www.oftwominds.com)
IMF: No End in Sight to Credit Crisis – (www.ft.com)

Fixed Rate, Prime Mortgages Dominate Market - (www.ml-implode.com) - "Demand for prime and fixed-rate mortgages increased during the second half of 2007, according to a report released today by the...
Home Prices Fall in May; Consumer Confidence Flat - (www.ml-implode.com) - Prices were down 15.8 percent from May 2007, including a 0.9 percent one-month drop in May alone. The 10-city price index, which...
FASB may delay off-balance sheet accounting change - (www.ml-implode.com) - "The Financial Accounting Standards Board, under pressure from lawmakers, will reconsider its timeline for a controversial rule ...
Why the government had to bail out the GSEs - (www.ml-implode.com) - "Expect more attempts to rescue the FIRE Economy, but don’t expect them to work."
Las Vegas - Miami home price death match - (www.ml-implode.com)
Can't Quit Worrying 'bout Fannie and Freddie - (www.ml-implode.com)
Judges and Foreclosure - (lawprofessors.typepad.com)
How One Borrower Beat the Foreclosure Machine - (www.nytimes.com)
Foreclosures as business opportunity - (www.youtube.com)
Worried Banks Sharply Reduce Business Loans - (www.nytimes.com)
Haitian strongman convicted of mortgage fraud - (www.cnn.com)
Rescap Update: Homecomings Cuts Equity Lending - (www.ml-implode.com)
Think the credit crunch is over? Ask a college student - (www.ml-implode.com)
Ratchet Provisions Soak Merrill Lynch, Will Sink WaMu - (www.ml-implode.com)
FDIC May Stall Paulson Mortgage Plan - (www.ml-implode.com)
Merrill to sell troubled assets, raise capital - (www.ml-implode.com)
Is Your Bank Safe? - (www.ml-implode.com)

Foreclosure Numbers Detail More Pain To Come - (money.cnn.com)
Credit crunch 'still worsening' - (news.bbc.co.uk)
U.S. Housing Slump Losses May Triple - (www.bloomberg.com)
U.S. housing losses pegged at $1-trillion - (www.theglobeandmail.com)
Jobless claims rise, house sales at new low - (www.thestar.com)
Price drops from seven to six figures - (latimesblogs.latimes.com)
Bargain hunters still shy of Orange County housing - (www.ocregister.com)
Our Empire of Debt Is Collapsing - (Charles Hugh Smith)
False Hopes Cling to New Housing Aid - (www.prweb.com)

U.S. Treasuries Decline on Speculation Worst Is Over for Banks - (www.bloomberg.com)
U.S. stocks bounce back as oil falls, consumer confidence rises - (www.marketwatch.com)
Dollar Rises to One-Month High as Confidence Gains, Oil Falls - (www.bloomberg.com)
What About The Renters? - (whatabouttherenters.blogspot.com)
Bank of Canada's Monkey See Monkey Do Policy - (Mish at globaleconomicanalysis.blogspot.com)
"BOHICA America" Weekend - (market-ticker.denninger.net)
Ron Paul on the Fannie-Freddie Fraud - (www.lewrockwell.com)

IMF sees no end in sight to credit crisis - (www.ft.com)
White House cuts GDP growth forecast - (www.latimes.com)
S&P/Case-Shiller 20-City Home-Price Index Fell 15.8% in May - (www.bloomberg.com)
Producers gloomy as slowdown spreads: survey - (www.reuters.com)
US credit crisis is hitting the wealthy - (www.ft.com)
New York City mayor warns of looming $2.3 billion budget gap - (www.chicagotribune.com)
US deficit zooming to half-trillion as Bush leaves - (biz.yahoo.com/ap)
No funds to lend to 40,000 students - (www.boston.com)
U.S. July Consumer Confidence Rose From 16-Year Low - (www.bloomberg.com)

Back down to earth for hedge funds of funds - (www.ft.com)
Banks' Woes Made Worse By Big Bets On Banks - (online.wsj.com)
Treasury, Banks Promote 'Covered Bonds' - (www.washingtonpost.com)
Could mortgages still be too easy to get? - (www.ocregister.com)
States Follow Federal Probe of Muni Derivatives, XL Filing Says - (www.bloomberg.com)
Credit crisis spreading in 'negative feedback loop': IMF - (news.yahoo.com/s/afp)
Bloated U.S. budget deficits may mean higher rates - (www.signonsandiego.com)
XL Capital to Raise Cash to Bolster Bond Insurer - (www.nytimes.com)
US credit crisis is hitting the wealthy - (www.ft.com)
NYSE responds to rise of algorithmic trades - (www.ft.com)
No funds to lend to 40,000 students - (www.boston.com)
Vacant-Property Fees Add to Mortgage Firms' Woes - (online.wsj.com)
Foreclosure-plagued cities gain sales - (www.boston.com)

Merrill Has $5.7 Billion of Writedowns, Sells Shares - (www.bloomberg.com)
Write-Down Is Planned at Merrill - (www.nytimes.com)
The Downfall of a California Dreamer - (www.nytimes.com)
Banks to Launch Covered Bonds - (online.wsj.com)
Mervyn's may file for bankruptcy protection: report - (www.reuters.com)
KKR in Fishbowl, Swims With Sharks - (online.wsj.com)
GM cuts truck production - (www.chicagotribune.com)

No quick fix for UK home loan crisis - (www.ft.com)
U.K. Mortgage Approvals Decline to Lowest Since 1999 - (www.bloomberg.com)
India Raises Rate More Than Expected to Tame Prices - (www.bloomberg.com)
Japan's economy shows signs of deterioration as jobless rate rises to 4.1 percent - (www.chicagotribune.com)
Sony issues profit warning after weak first quarter - (news.yahoo.com/s/afp)
U.K. CBI Retail Sales Index Declined to 25-Year Low in July - (www.bloomberg.com)
French July Consumer Confidence Declines to Record - (www.bloomberg.com)
Reports paint bleak picture for EU economy - (www.iht.com)

A New Way to Generate Mortgages - (www.nytimes.com)
Fannie Mae's Political Immunity - (online.wsj.com)