Implode-Explode Heavy Industries news feed Tracking the many faces of the global credit implosion. en-us iehi-feed-63381 Sun, 10 Dec 2017 16:42:51 GMT Ditech Financial Attorneys Facing Criminal Arraignment iehi-feed-63379 Sun, 10 Dec 2017 15:18:05 GMT Living in cars, working for Amazon: meet America's new nomads Despite a lack of hard numbers, anecdotal evidence suggests the ranks of American itinerants started to boom after the housing collapse and have kept growing.

The cause of the unmanageable household math that drives some people to become nomads is no secret.

Federal minimum wage is stalled at $7.25 an hour. The cost of shelter continues to climb. There are now only a dozen counties and one metro area where a full-time minimum-wage worker can afford a one-bedroom apartment at fair market rent.

At the same time, the top 1% now makes 81 times more than those in the bottom half do, when you compare average earnings. For American adults on the lower half of the income ladder -- some 117 million of them -- earnings haven't changed since the 1970s. This is not a wage gap -- it's a chasm.

The most widely accepted measure for calculating income inequality is a century-old formula called the Gini coefficient. What it reveals is startling. Today the United States has the most unequal society of all developed nations. America's level of inequality is comparable to that of Russia, China, Argentina and the war-torn Democratic Republic of the Congo.''

iehi-feed-63378 Fri, 08 Dec 2017 21:59:08 GMT Trump promises heavy penalties for Wells Fargo President Trump on Friday tweeted that the he'd ensure stiff penalties against Wells Fargo over allegations of financial impropriety the day after a report emerged that federal fines are being reconsidered.

"Fines and penalties against Wells Fargo Bank for their bad acts against their customers and others will not be dropped, as has incorrectly been reported, but will be pursued and, if anything, substantially increased," Trump tweeted.

"I will cut Regs but make penalties severe when caught cheating!"

iehi-feed-63372 Thu, 07 Dec 2017 23:03:14 GMT US Bank Exits Wholesale iehi-feed-63341 Wed, 29 Nov 2017 16:54:13 GMT The next big thing at Hudson Yards: free rent and no security deposits iehi-feed-63319 Wed, 22 Nov 2017 18:20:41 GMT Flat-pack home costs $32K and can be built in six hours It comes in a variety of sizes, ranging from a 290-square-foot tiny home for $32,800 to a 904-square-foot family home which will set you back $72,650. It also has the eco-friendly capacity to become completely off-grid with solar panels and LED lighting.


It will cost you between $2,000 to $2,600 per unit to get it delivered to London.

iehi-feed-63313 Mon, 20 Nov 2017 17:16:24 GMT Its Time To Say Sayonara To Federally Funded CRA Housing Agencies iehi-feed-63312 Mon, 20 Nov 2017 17:13:55 GMT Is Flagstar Bank Playing Low-Income Borrowers For Chumps? iehi-feed-63309 Sat, 18 Nov 2017 20:48:41 GMT Wells Fargo Consumer Lending Chief Fired For Being A Big Mouth iehi-feed-63302 Sat, 18 Nov 2017 00:09:40 GMT How racist official housing policies supercharged today's US wealth gap In the postwar period, white Americans were given attractive, government-subsidized mortgages to move to all-white suburbs, the best known of which was New York's Levittown, that were not accessible to blacks and other minority groups. That helped white families that benefited from those mortgages to build housing wealth.

The Federal Housing Administration at the time not only "refused to insure mortgages in predominantly African American neighborhoods" but also actively subsidized "the movement of white families out of cities into single-family homes in the suburbs," Rothstein said.

Racial segregation was built into public-housing policy. Contracts in suburban subdivisions were made with an FHA subsidy that explicitly required that no blacks be allowed to move in, either initially or through future sales.

All those policy decisions led directly to the race gaps we see now. "Without federal government policy of this kind we would not have the kind of segregation in any metropolitan area today," Rothstein said.

iehi-feed-63294 Thu, 16 Nov 2017 20:07:04 GMT House passes sweeping tax bill; Teeing Senate Up For Battle The House on Thursday passed legislation to overhaul the tax code, moving Republicans one step closer to achieving the top item on their legislative agenda. 

The measure was approved by a vote of 227-205. No Democrats voted for the bill, while 13 Republicans broke ranks to oppose it.  


Senate Republicans have their own tax bill, which is currently being considered by the chamber's tax-writing committee.

The Senate legislation differs from the House's in a number of ways. Unlike the House bill, the Senate bill fully repeals the state and local tax deduction, delays the corporate tax cut until 2019 and repeals ObamaCare's individual mandate. 

The Senate's bill also sunsets tax cuts for individuals after 2025, in order to comply with the "Byrd rule" that the measure can't increase the deficit after 10 years if it is to pass with a simple majority.

No more than two Senate Republicans can vote against their bill if Democrats are united in opposition to it. Already, Sen. Ron Johnson (R-Wis.) has said he doesn't support either the House or the Senate bills because they provide more of a benefit to corporations than to other types of businesses. Sen. Susan Collins (R-Maine) has expressed concerns about including repeal of the individual mandate, but has not taken a hard stance yet on the measure.''

iehi-feed-63293 Thu, 16 Nov 2017 17:11:03 GMT The Shock of Sweden's Housing Market is Hitting the Country's Currency Can a central bank steer the housing market? Not so long ago, Sweden's Riksbank decided: no. Now, there's a risk that decision may backfire as the biggest property market in Scandinavia risks sinking into a correction.

The evidence of price declines was so worrying on Tuesday that it contributed to a 1.5 percent slump in the krona against the euro. A weak currency puts the Riksbank's inflation target at risk. So should it be looking at the housing market more closely?

Developments in Sweden's housing market "could spark some doubts at the Riksbank as it may affect the overall economic outlook and inflation," Nordea analyst Andreas Wallstrom said in a note.

iehi-feed-63290 Wed, 15 Nov 2017 18:39:51 GMT Richard Cordray is stepping down as head of CFPB (RESTORATION OF BANKSTERS IS COMPLETE!) Richard Cordray, one of the few remaining Obama-era banking regulators, said on Wednesday that he plans to step down as head of the Consumer Financial Protection Bureau by the end of the month, clearing the way for President Trump to remake a watchdog agency loathed by Republicans and Wall Street.

Cordray's decision comes just a month after the CFPB suffered a major rebuke from Republicans in Congress who took the unusual step of blocking an agency rule that would have allowed consumers to sue their banks for the first time. Cordray appealed to President Trump directly not to sign the legislation but was rebuffed.


With Cordray's departure, the aggressive regulatory structure put in place by the Obama administration in the wake of the global financial crisis has been nearly entirely replaced. The head of the Securities and Exchange Commission has been replaced by a former Wall Street lawyer and the Senate is moving to approve Trump's pick to lead the Office of the Comptroller of the Currency, another important banking regulator. The head of the Federal Deposit Insurance Corp., Martin Gruenberg, has said he will step down at the end of the month.


The agency has been controversial among Republicans since its inception. Critics complain that CFPB has made it more difficult for people to get a mortgage loan and has overstepped its power to regulate some industries, including auto loans.

More difficult to get a mortgage?! How horrible. It's not like that was ever needed in our recent past (oh, 2007, you say? That's like, a million years ago...)

iehi-feed-63288 Wed, 15 Nov 2017 17:34:18 GMT Household debt rises by $116 billion as credit-card delinquencies pile up iehi-feed-63277 Fri, 10 Nov 2017 18:22:56 GMT The Fed Actually Begins its QE Unwind (BUT LESS THAN PROMISED) The Fed is supposed to unload $10 billion in October. Instead it unloaded $4 billion. And the variations from week to week are entirely in the normal range of the prior months.


Clearly, the Fed has not yet kicked off the unwind of its MBS portfolio. Since the end of QE, the Fed's Open Market Operations (OMO) has continually purchased small amounts of MBS in the market... And it has continued buying them in October with stoic routine.

This bifurcation -- that the QE unwind is happening with Treasury securities but not with MBS -- is curious. But MBS take a while to settle, which could explain some of the delay. After the on-target $6-billion drop in Treasuries, however, I'm tempted to think that the QE unwind of MBS will also eventually materialize, and that the overall package will proceed as announced.

iehi-feed-63266 Thu, 09 Nov 2017 17:57:05 GMT Foreclosed $51 Million "Billionaire's Row" Penthouse Sells At A 30% Discount iehi-feed-63260 Wed, 08 Nov 2017 01:16:04 GMT Douglas Elliman's profitability falls over 50% with fewer new dev closings The New York-based brokerage pulled in $190.4 million in revenue, up 3.2 percent from $184.5 million during the prior-year period, according to filings by its parent company, Vector Group. But net income was $4.2 million -- down from $8.7 million in 2016.

Those numbers were the result of a strong low-end market but softer new development segment, where Elliman has had fewer closings despite a robust pipeline of projects it is marketing.

"There were more closings in '16 than in '17 -- quite a bit more," Chairman Howard Lorber said during an earnings call Tuesday.

Overall, Elliman closed $7 billion worth of sales during the quarter compared to $6.8 billion in 2016. For the first nine months of the year, Elliman closed sales worth $19.8 billion compared to $18.9 billion a year earlier.

Lorber said the low-end of the market is "very, very strong," as is the high-end. The mid-market segment is "kind of quiet," he said.

iehi-feed-63246 Sat, 04 Nov 2017 14:41:10 GMT Stockman: Proposed Tax Bill is Middle Class Tax Raise in Sheep's Clothing In the first place, it does not cut anything that could remotely be called middle class taxes by a net dime over the next ten years; it actually increases them... the real skunk in the woodpile is the fact that more than 100% of this cut in individual income taxes is accounted for by three items, which will accrue overwhelmingly to the very wealthy.

To wit, the bill repeals the alternative minimum tax at a cost of just under $700 billion over the decade, phases out the estate tax at a cost of $172 billion and provides for the so-called business pass-thru rate of 25% at a cost of nearly $450 billion.

Add these three items up and you see our point about funny numbers. The sum of $1.32 trillion for these three items is $386 billion larger than the entire individual tax cut contained in the bill!

Stated differently, set aside these three items and the baseline individual income tax revenue over the next decade would be $20.9 trillion----meaning that the GOP's ballyhooed tax bill will raise taxes by $386 billion or 2% on everyone else. 

iehi-feed-63245 Sat, 04 Nov 2017 14:33:46 GMT Lobbying Frenzy Begins on Tax Bill; Party-Line Vote Ability In Doubt The Republican tax rewrite unveiled on Thursday has set off a scramble among lobbyists and interest groups desperate to preserve prized tax breaks that are suddenly at risk in the sweeping bill moving through the House.


The rapid pace set out by Republican leaders is by design: They want to prevent the kind of arm-twisting that has long bedeviled previous tax overhaul efforts by leaving little time for outside groups to blitz lawmakers with concerns. Several consultants and lobbyists said on Friday that individual companies were just beginning to digest how the 400-plus page bill, which drastically changes how American businesses are taxed at home and abroad, would affect their bottom lines.


The groups pushing back the hardest on Friday included those in the real estate industry. Some of them had raised concerns before the bill was released, only to discover their biggest fears realized in the draft legislation. The bill includes several measures long opposed by those groups, including a limit on interest deductions for new home purchases of $500,000 or more and an expansion of the standard deduction.

The Mortgage Bankers Association plans conference calls and discussions with members of Congress throughout the weekend, said David Stevens, the group's president. Realtors are running online ads raising concerns over those provisions.


Representative Kevin Brady of Texas, the chairman of the House Ways and Means Committee, said no decision had been made about whether to include repeal of the so-called individual mandate. But he said Mr. Trump wants its inclusion, and he indicated that Republicans wanted to evaluate the fiscal effects of taking that step. Senate Republicans may not be as enthused about its inclusion.


[However, a Tax Foundation] analysis found that the draft legislation would cost too much to survive the budgetary requirements needed to pass the Senate on a party-line vote -- a sign that Republicans will almost certainly need to rework it in order to keep their hopes alive for delivering a bill to Mr. Trump's desk by December.

The analysis found that the bill would add $2 trillion to the federal budget deficit over the next decade, an amount that shrinks to $1 trillion even when additional economic growth effects from the bill are factored in.

"This does not pay for itself," said Scott Greenberg, a senior analyst at the Tax Foundation.

iehi-feed-63238 Fri, 03 Nov 2017 01:38:54 GMT Homebuilders Plunge as New Buyers Could See U.S. Tax Break Cut The bill's talking points, released Thursday, suggest that the interest deduction for existing home mortgages will be preserved in full, but newly purchased homes will see the cap

cut in half, to $500,000.

The SPDR S&P Homebuilders exchange-traded fund, ticker XHB, and an S&P index that tracks builders plunged in early trading. If the losses hold, it would be the worst day for both in more than a year. Luxury homebuilder Toll Brothers Inc. fell as much as 7.3 percent, and retailer Home Depot Inc. also saw heavy losses.

We cryeth not many tears over this, frankly...