Implode-Explode Heavy Industries news feed

Why Crony Capitalist Brats Make Me ILL - David Stockman

Wed, 16 Apr 2014 18:22:16 GMT

During 2012 Levin's 14-person team of speculators apparently made a $2.0 billion profit on a short-term bet on about $7.5 billion of busted loans and bonds-- mainly the smoking remnants of sub-prime CDOs and private labor MBS. As head of the trading group, Leven's share was apparently the aforesaid $119 million, and this swell outcome was truly a gigs-to-riches story.
... in an honest two-way market, no one in their right mind would bet $7.5 billion on financial drek using high leverage and minimal hedges. And no 30-year old would be given leave to close his eyes and bet the ranch, as apparently Levin did, based on merely the "housing recovery" word clouds being emitted by the monetary politburo and its echo-boxes in the financial press.''

Tom Deutsch of the ASF on Eminent Domain & Loan Modifications -- A Mandelman Matters Podcast

Tue, 15 Apr 2014 17:44:54 GMT

``If Professor Robert Hockett is the man behind the plan to use eminent domain to take over underwater loans and write them down for homeowners, Tom Deutsch is his arch nemesis. On this 30 minute podcast, you'll get to hear one of the chief opponents to Professor Hockett's Municipal Plan, describe in detail why he believes the plan is entirely wrong in every way, and why he believes that is will ultimately fail.''

Lending Drops to 17-Year Low as Rates Curb Borrowing: Mortgages

Tue, 15 Apr 2014 16:20:02 GMT

``At Wells Fargo, home-loan originations exceeded $100 billion for seven straight quarters, ending in June 2013. The figure plunged to $36 billion in the three months through March, the San Francisco-based bank said April 11... Lending has been tumbling since mid-2013 when mortgage rates jumped about a percentage point after the Federal Reserve said it might taper stimulus spending. A surge in all-cash purchases to more than 40 percent has kept housing prices rising, squeezing more Americans out of the market. That will help push lending down further this year, according to the association.''

Zombie Mortgage Land! Lowest Mortgage Origination Volume on Record (And Average Loan in Foreclosure Now 2.6 Years Past Due)

Mon, 07 Apr 2014 23:10:28 GMT

``This is somewhat surprising given that 30 yr fixed mortgage rates are still below 5%. Then again, real median household income was falling along with mortgage rates until May 1st, 2013.''

Welcome to Feudalfornia: the golden sarcophagus and the investor

Sun, 06 Apr 2014 17:20:41 GMT

The current sales volume is lower than what we saw in the early 1990s. In fact, current sales are the lowest since the market imploded a few years ago. What gives? The current trend was driven by low inventory, investor demand, and house lusting buyers. As investors pull-back and affordability falls, it is natural to expect volume to naturally pickup as it has. Yet California is largely becoming a renter state.
...
[But now] the investor crowd is pulling back: "Prices have gotten to the stage where we cannot buy a house, renovate it, rent it and still make a reasonable return," said Peter Rose, a spokesman for Blackstone, which owns roughly 41,000 rental houses nationwide. "There was a moment in time where it made sense."

February Pending Home Sales Continue Slide

Mon, 31 Mar 2014 02:55:46 GMT

``WASHINGTON (March 27, 2014) -- Pending home sales declined for the eighth straight month in February, according to the National Association of Realtors®. Modest increases in the Midwest and West were offset by declines in the Northeast and South; all regions are below a year ago. The Pending Home Sales Index,* a forward-looking indicator based on contract signings, dipped 0.8 percent to 93.9 from a downwardly revised 94.7 in January, and is 10.5 percent below February 2013 when it was 104.9. The February reading was the lowest since October 2011, when it was 92.2.''

Goldman Sachs Must Face Lawsuit Over 2007 Mortgage Bonds

Fri, 28 Mar 2014 20:51:49 GMT

``Goldman Sachs Group Inc. (GS) failed to persuade a federal judge to again throw out a securities lawsuit over residential mortgage-backed securities it sold in 2007 after an appeals court overturned an earlier decision... The appeals panel also threw out her ruling that the [other] fund couldn't represent investors in offerings of the securities it hadn't bought itself.'''

What A Bank Run In China Looks Like

Wed, 26 Mar 2014 21:29:44 GMT

``The photo below, which shows hundreds of people rushing today to withdraw money from branches of two small Chinese banks after rumors spread about solvency at one of them, are sufficiently informative about just how jittery ordinary Chinese have become in recent days, and reflect the growing anxiety among investors as regulators signal greater tolerance for credit defaults.''

As credit tightens at home, Chinese sell Hong Kong luxury real estate

Mon, 24 Mar 2014 02:57:43 GMT

``Cash-strapped Chinese are scrambling to sell their luxury homes in Hong Kong, and some are knocking up to a fifth off the price for a quick sale, as a liquidity crunch looms on the mainland. Wealthy Chinese were blamed for pushing up property prices in the former British territory, where they accounted for 43 percent of new luxury home sales in the third quarter of 2012, before a tax hike on foreign buyers was announced.''

The Stunning History Of "All Cash" Home Purchases In The US

Mon, 24 Mar 2014 02:31:56 GMT

``while before the great crisis only 20% of home purchases were "all cash", since then the number has soared threefold, and currently the estimated percentage of cash transactions (by count and amount) has hit a record 60%''

(Real and fake) Reasons Why NOW is a GREAT Time to BUY a Home - Mandelman

Fri, 21 Mar 2014 21:48:54 GMT

``Demand is unquestionably down... the nonsense that you read saying otherwise is part of some fruit loopy P.R. campaign that I suppose some think helps to stimulate the marketplace for residential real estate... and maybe it does... a little bit. But, as to any sort of recovery the answer is no... it's impossible and it will remain impossible for a long, long time...''

The Only CEO Prosecuted For The Mortgage Crisis Says He Feels Like A `Zombie' In Jail

Thu, 20 Mar 2014 22:10:52 GMT

Farkas, who says he is lonely and suffering from depression said, "You're not really alive in here, you're a zombie--just a body walking around, eating, sleeping and being yelled at.

Nationwide Home Sales Collapse: There Is No Recovery and This Chart Proves It

Thu, 20 Mar 2014 22:08:55 GMT

Now may be the best time to buy a home. At least that's what the majority of real estate agents in America will tell you if you ask them how the housing market is doing.
They'll cite various statistics and give you a "feel" for the market from their personal experiences to convince you this is the case. But if you're paying attention, then it should be clear that there is, in fact, no recovery in the housing sector. And any gains we may have seen over the last few years are nothing short of a Federal Reserve fueled mirage, much like the stock market.

China's Housing Problem In One Chart (Home starts growth)

Thu, 20 Mar 2014 19:03:26 GMT

``... in China where as the chart below shows, as of this moment at least, the supply side to the Chinese housing ponzi (and recall that in China the bubble is not in the stock market like in the US, but in housing) has slammed shut.''

ARMS Are All the Rage Again

Thu, 20 Mar 2014 02:54:59 GMT

``... now lenders say they're issuing ARMs to more-qualified buyers who are taking out jumbo loans...ARMs accounted for 31 percent of mortgages originated in the $417,001-to-$1 million range during the fourth quarter, according to data prepared for The Journal by Black Knight Financial Services... While lenders are hoping for higher interest rates, borrowers are hoping that rates either stay low or they sell their homes before the ARMs reset at higher rates...''

Feb. housing starts steady; permits surge

Tue, 18 Mar 2014 19:10:00 GMT

``Housing starts increased in the South and Midwest last month, but slowed in the Northeast and West. Permits, a gauge of future construction, ran at an annual pace of just over 1 million, a 7.7% increase from January and the highest level since October. The gain was all in multi-family housing, where permits have climbed to mid-2008 levels. But permits for single-family houses fell 1.8%, the third straight monthly decline.''

U.S. retirees return to reverse mortgages, big banks stay away

Tue, 18 Mar 2014 13:18:04 GMT

U.S. baby boomers desperate for retirement income are increasingly turning back to a financial product that, after the housing bust, had been left for dead: the reverse mortgage...
... at this stage, most bigger lenders are uncomfortable with the loans -- for example, in 2011, Wells Fargo & Co and Bank of America backed out of the business. Wells has cited factors including unpredictable home values and the level of delinquencies as reasons for it to stay away from reverse mortgages.

The government agency that guarantees these loans, the U.S. Federal Housing Administration, found them to be risky, too. Losses on reverse mortgages were a big reason for the agency's $1.7 billion taxpayer bailout last year - and some experts worry it could end up in similar trouble again.

U.S. home builder sentiment ticks up in March, still sour

Mon, 17 Mar 2014 14:20:56 GMT

``U.S. homebuilder sentiment edged up in March but sentiment remained mostly poor as concerns linger, the National Association of Home Builders said on Monday. The NAHB/Wells Fargo Housing Market index rose to 47 in March from 46 in February, the group said in a statement. February's decline was the largest ever month-to-month, and economists polled by Reuters had predicted the index would rebound to 50 in March''

After Fannie, Freddie's wild ride, future is murky

Fri, 14 Mar 2014 16:51:32 GMT

``Yes, U.S. senators are taking an important step by introducing a piece of major housing-finance reform with bipartisan support . But analysts agree that there are vanishing chances for the Senate to approve a bill this year. Even if senators make progress next year on the legislation, an agreement still must be reached with U.S. House lawmakers, and Republicans there want the government to play a smaller role in a reformed housing-finance system than what senators have proposed.''

Get on the bus, Gus: U.S. posts record public transit use

Mon, 10 Mar 2014 16:51:12 GMT

``Americans took a record 10.7 billion trips on public transportation last year as an increase in urban living, costlier fuel, more investment and an economic upturn helped drive ridership, an industry group said on Monday... The U.S. trend toward urban living and walkable cities also is behind the upturn in ridership. A surge in ridership that came in 2008 when gasoline and diesel prices spiked has continued even though the cost of fuel has fallen, Melaniphy said.''