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mortgage meltdown: Does Fannie Mae and Freddie Mac's Insolvency Spell Financial Doomsday? - 07/14/08 10:29 AM
I was reading an interesting article from Agora Financial which is spelled out in their "Rude Awakening". One part caught my eye as they discussed what is currently taking place in the dual FM liquidity crisis, as presented by Dan Denning, editor of the Australian Daily Reckoning.
Dan talks about Ben Bernanke's comments to Congress that both Fannie Mae and Freddie Mac are well capitalized and how those were the statements by Bear Stearns just before their collapse. Citigroup was the saying the same thing just before asking for more money. Dan hits the nail on the head with these remarks...
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mortgage meltdown: Happy Halloween, or Will It Be a "Tricky" One? - 10/30/07 11:13 PM
It is Halloween and today represents a day for ghosts, goblins, and ghouls to come out and scare everyone. But could there be something scarier lurking in the daylight?
There is certainly no shortage of scary stuff this year. Lead poisoned toys, fish and tea from China. Terrorist plots. The mortgage meltdown and liquidity crisis. Sagging real estate prices. Rampant foreclosures. Britney Spears. Of course, just about every year has there "fears" ranging from global warming to global cooling (remember that issue years ago?).
But today marks the most frightful day of the financial markets. Why? We have several reports coming today … (5 comments)
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mortgage meltdown: Why Aren't Homes Selling? This Should be a Clue - 09/21/07 12:52 PM
Ever wonder why there doesn't seem to be any homes being sold in your area? Granted some areas are doing well, but a survey released today from Reuters/University of Michigan provides an insight as to one possibility.
The survey revolves around the homeowner's perception of their own home values and the headlines today stated the obvious, a record 26% of US homeowner's say the value of their hoes has fallen during the past year. The survey also showed 21% of homeowners expect their homes value to decline in the year ahead. OK, the news ran with that, but take a different look at … (4 comments)
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mortgage meltdown: Will the Fed Regret Cutting Rates? - 09/20/07 11:10 AM
With the 50 basis point cut on the Fed Funds Rate, what is going to happen, and could it ultimately have the opposite effect?
Sure, it will help many ARM holders, as well as those with HELOCs, credit card balances and some others. But what about the long run? It hurts those trying to save money, encourages adding more debt, and may even create more inflation.
All of that may occur, but the reality is that the rate cut will not help homeowners who are already in trouble, so it does little to help the credit crunch. And what about mortgage rates themselves? What about … (5 comments)
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mortgage meltdown: Federal Bailout in the Works? Could Modified Option ARMs be the Savior? - 08/29/07 09:46 PM
Ben Bernanke, our beloved Federal Reserve Chairman, wrote a letter to Senator Charles Schumer (D-NY) that was released today. In the letter, Mr. Bernanke wrote that the private sector and Congress should create new, affordable mortgage products that would help some homeowners refinance their mortgages and keep their homes. Sounds like a bailout is in the works to me.
The letter really doesn't add anything new to the markets, but rather reemphasizes what the Fed has been thinking since their statement after the August 17th cut in the discount rate. The letter is being toughted as a "bullish" letter by bond strategists … (5 comments)
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mortgage meltdown: Mortgage Market Meltdown: Is the World Really Coming to an End? - 08/11/07 12:44 PM
It is hard to turn on the TV or radio and not hear about the turmoil happening in the mortgage markets and real estate these days. But, is what you are hearing really blowing it out of proportions?
Down here in Florida, particularly in South Florida, it may have more of an effect. Why? We seem to have a larger than normal portion of non-conforming loans. However, there is still no cause for panic as they are still the majority of the overall market.
So, let's put things into a little perspective. How bad is it really, especially when we consider how things … (7 comments)
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mortgage meltdown: Fannie Mae Unable to Assist Mortgage Market's Problems - 08/11/07 10:34 AM
Late yesterday, The Office of Federal Housing Enterprise Oversight denied Fannie Mae's (FNMA) request to increase its portfolio beyond the $727 billion limit currently in place (as of May 2006). This was despite arguments from senior Democrats and the company stating that the change would provide much needed stability in the mortgage market.
Several major mortgage companies have complained about the inability of selling loans to investors (the secondary market) and FNMA said it could pump liquidity into this area. President Bush said that any changes to FNMA or Freddie Mac (FHLMC) should come about after Congress completes a reform package.
The announcement … (5 comments)
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mortgage meltdown: Mortgage Market Meltdown - The Saga Continues - 08/03/07 07:55 PM
No doubt you have been hearing a lot about the changes taking place in the mortgage market over the last 4 days involving every loan except conventional conforming ones. My previous post, Mortgage Market Meltdown - Will it be Subprime Only? (dated July 11th), talked about how the effects of the subprime market was going to spill over into the rest of the markets, including A-paper. Well, that is what is happening right now.
Call it what you will, liquidity crisis or whatever, the effects are easy to see. As I was quoted in MarketWatch today, "If something is perceived as … (5 comments)
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mortgage meltdown: Are You Responsible for the Subprime Mortgage Debacle? - 07/11/07 07:52 PM
Every day, the media talks about the problems in the hosuing market. Most of the talk centers around the loss of homes due to "exotic mortgages", dishonest lenders, among others. People who are marginal borrowers, those we call the subprime market, are often the subjects of the stories. They will also likely be the ones most affected by the changes that have already occurred as well as those in the pipeline. As is typical, the changes implemented most affect the ones who can least afford it.
From the point of view of one who recommends using their home to build wealth, I … (11 comments)
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Robert D. Ashby
Miramar,
FL
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