New Lee Adler, Aaron Krowne, and Russ Winter podcast is out. About 12 minutes of free preview is also available.The Bear Stearns Senate hearings can be found here.
For newer readers or listeners there is a primer of my terms, and a general review of my approach in the Primer on Winterisms, here. This is always located in the side bar as a dictionary of sorts.
Also discussed was how the extreme unaffordabilty in one-third of the country is leading to big problems. New bankruptcy data suggests the trouble is accelerating.
“We’re seeing fairly high readings in these measures of distress like bankruptcies, foreclosures and mortgage defaults,'’ said Chris Low, chief U.S. economist at FTN Financial in New York. The most affected states are “also where the most housing-related business growth was,'’ said Low. The states most affected by the housing recession, including California, Nevada and Florida, were among those with the largest increases in bankruptcies.
They are also among states where unemployment rates exceed the national average. The jobless rate in California is 5.7 percent and Nevada’s is 5.5 percent in February. Nationally, 5.1 percent of workers were unemployed in March, the highest level since September 2005, the Labor Department reported yesterday.
California led the nation with a 42 percent increase in bankruptcy filings at an annual pace in the first quarter, according to Jupiter eSources LLC. Florida had a 35 percent increase and Nevada saw a 32 percent rise, according to the Oklahoma City-based Jupiter’s service known as AACER, or Automated Access to Court Electronic Records. Nevada led the nation with the highest foreclosure rate in February, with filings up 68 percent from a year before, and with one in every 165 households in default or foreclosure, according to RealtyTrac Inc., a seller of foreclosure data.
More “tax breaks” for favored rackets promises to swell the impending fiscal disaster (that we also discussed) even further. The negative selection crowd is falling all over themselves in this task. Also revealing is that they call (in classic Orwellian fashion) breaks to industry “foreclosure prevention”.
WASHINGTON - Homebuilders and the mortgage industry are emerging as big victors in a bipartisan agreement reached by Senate leaders on legislation designed to limit the housing crisis. The $15 billion Foreclosure Prevention Act of 2008, expected to be debated Thursday afternoon on the Senate floor, is drawing fire from critics who say it would do little to actually prevent foreclosures. The bill contains a $6 billion emergency tax break that would let companies use losses from 2008 and 2009 to offset profits earned over the previous four years, instead of the usual two-year timeframe.
It is also obvious that lenders are being sent a signal about the future course of foreclosures. As such they are delaying foreclosures, thus adding even more costs and losses to recoveries. Once again the law of unintended consequences raises it’s ugly head.
April 4 (Bloomberg) -- Banks are so overwhelmed by the U.S. housing crisis they’ve started to look the other way when homeowners stop paying their mortgages. The number of borrowers at least 90 days late on their home loans rose to 3.6 percent at the end of December, the highest in at least five years, according to the Mortgage Bankers Association in Washington. That figure, for the first time, is almost double the 2 percent who have been foreclosed on.
Lenders who allow owners to stay in their homes are distorting the record foreclosure rate and delaying the worst of the housing decline, said Mark Zandi, chief economist at Moody’s Economy.com, a unit of New York-based Moody’s Corp. These borrowers will eventually push the number of delinquencies even higher and send more homes onto an already glutted market.
On the Mad Max front, labor unions in Europe are getting aggressive. They will be lucky if this is contained to protest.
LJUBLJANA, April 5 (Reuters) - Trade unions protested over corporate greed and “poverty wages” for more than 30 million workers in Europe as politicians and central bankers meeting in Slovenia called for wage restraint to curb inflation. At a time when food and energy prices are surging worldwide, the European Trade Union Confederation sought to mobilise up to 35,000 people for a rally in Slovenia’s capital on Saturday to denounce a decline in spending power and demand better pay.
Inflation expectations “unhinged’?
