The Fed’s own holdings of MBS shrank $8.357 billion and foreign central banks’ holdings of MBS fell a similar amount, which wouldn’t be surprising if most of the latter turns out to have been attributed to the “foreign” bits of the NY Fed (Where’s Ron Paul’s audit when we need it? ) Meanwhile, you’ll now have to go back seventeen weeks, all the way to when IAEA was still giving Fukushima updates, to see a similar level of foreign central bank holdings of Treasury Debt. Whether it’s Japan’s 3/11 struggles, the eurozone crisis or Chinese rebalancing the cenbanks’ redemption of…
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You know that old joke about “Sure, we lose money on every deal, but we figure we’ll make it up on volume”?  I couldn’t help but think of that this morning when I was reading an article L sent me this morning. The article was about FHFA’s review of Bank of America’s mortgages, and indicated that FHFA examiners did have some concerns about how Freddie Mac was reviewing mortgages.  Doesn’t this sound like that “make it up on volume” strategy? Senior Freddie Mac managers disagreed with the examiner’s concerns and said they feared losing business from Bank of America if…
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A Mattia Mcintyre of Hannibal, New York was in talks with Citimortgage to refinance her home.  She was behind in her payments, but she had not received a Notice of Default.  Imagine her surprise when she came home to find that without giving notice, the lender hired a contractor to clean out her house. Safeguard Properties LLC was hired by Citimortgage to secure the property.  I found the following from their website ironic: At Safeguard, we believe that communication is the key to all areas of success.  Without it, we cannot successfully manage the preservation process or our relationships with…
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The Fed’s own holdings of MBS eased down $5.705 billion and foreign central banks’ holdings of treasuries returned to their level of nine weeks ago. This week’s Reuters report1 is, as usual, based on the weekly update from the NY Fed’s H.4.1 table site.2 Here is Doom’s updated CSV version3 of the agencies and treasuries foreign central bank holdings data set. The trajectory of the yellow line continues to look like a top. The significance of this potentially historic turn-around is being largely lost among all the other things falling off the central bankers’ plates. Treasury Debt holdings continued their…
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On of the bigger chuckles I’ve had this week was an explanation of how junk bonds work, forwarded to me by L.  For those of you who wondered what “mortgage bond securities” were and how they worked, this is one of the clearer explanations of how bond markets work that I’ve seen. I understand it’s been floating around the internet awhile, but it was new to me. Heidi is the proprietor of a bar in Detroit. She realizes that virtually all of her customers are unemployed alcoholics and, as such, can no longer afford to patronize her bar. To solve…
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Stan Humphries, chief economist for Zillow, spoke yesterday about government intervention in the housing markets.  I loved his point that “government policy can only do so much against fundamental market movements.  He made three major points: First, don’t underestimate the market’s ability to fix itself. This is, in fact, already happening. We may not like the timetable, but economic recovery can’t always happen overnight. Second, many policies addressing foreclosures are simply addressing symptoms, not fundamental drivers of a healthy housing market. Yes, declining values have led to foreclosures, which have created an excess supply of housing. But eliminating this excess…
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The Fed’s own holdings of MBS were again unchanged and foreign central banks’ holdings of treasuries again fell rather dramatically. As well, this is the anniversary of the “Where’s Zhou” anomaly, so the Setser chart took on some drama. This week’s Reuters report1 is, as usual, based on the weekly update from the NY Fed’s H.4.1 table site.2 Here is Doom’s updated CSV version3 of the agencies and treasuries foreign central bank holdings data set. The trajectory of the yellow line looks more and more like a top, but with central banks everywhere coordinating massive intervention all over the place…
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It has been interesting watching the mantra of the National Association of Realtors change with the changing market.  At the peak it was “Buy before it’s too late!” As the market started to cool it was “It’s always a great time to buy or sell a house!” As it cooled further, the new mantra was “You don’t want to time the market.”  Here’s the latest version I’ve seen of that advice: QUESTION: We are tired of renting and want to buy a home but we are afraid that prices will keep falling. How do we know when it is the…
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Yesterday L sent me an article from the Arizona Republic titled 101-year-old Detroit Woman Evicted in Foreclosure. It sounds at first like an evil lender sends out some dastardly Snidely Whiplash-type to evict an aged grandmother.  When you read the story though, you realize there’s more to it: DETROIT – A 101-year-old woman was evicted from the southwest Detroit home where she lived for nearly six decades after her 65-year-old son failed to pay the mortgage. Texana Hollis was evicted Monday and her belongings were placed outside the home. Her son, Warren Hollis, said he didn’t pay the bill for…
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The administration seems to believe that if they can get interest rates to limbo low enough, it will help fix the housing market– This in spite of the fact that interest rates have been low for years.  Here’s the problem: With mortgage rates at record low levels, millions of Americans have refinanced their homes to save money. But homeowners who owe more than their house is worth are cut off from the benefit of lower interest rates. Three-fourths of homeowners who are underwater in their loans are stuck paying higher interest rates, according to a new report from researchers at…
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Summer has ended.  It’s time to close down the pool, store the boat, and walk away from the mortgage?  That’s one explanation given by Jay Butler for the month to month rise in the foreclosure rate in Phoenix.  According to Butler, people might be giving up on selling the place at the end of the summer when it’s less likely to affect the kids. ASU: Number of Foreclosed Homes Grows: MyFoxPHOENIX.com I find Butler’s explanation unlikely.  Banks rarely moved that quickly after a homeowner defaults and moves.  I suspect that investor interest in purchasing foreclosures and better methods of handling…
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I’ve read (and posted about) heartbreaking cases where people facing foreclosure have abandoned their pets and livestock.  I’m a big animal lover, and it’s tough for me to understand how anyone could do that.  If abandoning animals is hard to understand though, this one is unfathomable.  A Minnesota father facing foreclosure not only walked away from his property, he walked away from his son as well: LAKEVILLE, Minn. — A father abandoned his 11-year-old son last month, telling him in a letter to move in with neighbors because their south Minnesota home was in foreclosure, according to a warrant complaint…
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The Fed’s own holdings of MBS were unchanged and foreign central banks’ holdings of treasuries plunged to about the level they were at four weeks ago. This week’s Reuters report1 is, as usual, based on the weekly update from the NY Fed’s H.4.1 table site.2 Here is Doom’s updated CSV version3 of the agencies and treasuries foreign central bank holdings data set. Treasury Debt holdings fell a substantial $10.349 billion. Agencies shrank by a small $0.431 billion. *Agen-FM: The dotted line is the foreign central banks’ Agency Debt holdings reduced by the level of the Fed’s own MBS holdings. Since…
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There have been a lot of complaints about lenders just not lending, and the difficulty people are having obtaining loans.  While it is much more difficult than it was back in the “mirror test” days of lending, there’s another reason lending is down.  The “housing craze” is over, and demand is way down: The financial meltdown of 2008 sent commercial lenders fleeing from making loans on virtually anything related to building houses. Lending for housing developments and spec homes essentially dried up, and not much has changed three years later, commercial lending executives say. There has been little warming in…
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Sometimes things are stated so succinctly, you can post them with very little comment.  I’ve read a lot of opinions about the administration’s efforts to prevent foreclosure through loan modification.  For the most part, the experts agree that loan mods have failed and will continue to fail.  I found two statements that really get to the heart of the matter and explain why.  The first is from Wall Street Pit: It appears despite the record low mortgage rates, people are more or less tapped out even in terms of refinancing – i.e. almost everyone who is able to refinance has…
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