Recession Worries Continue

Posted: 31 Jul 2008 04:32 AM CDT
Something’s in the air…news of recession everywhere. Or so it seems this evening.
First, readers Michael and Scott sent us Jeremy Grantham’s latest newsletter. Grantham is known as a perma-bear, and his call that a major bank would fail in the next five years (this about two years ago) was [...]

Citi To Write Down More Losses?

Ready for another wave of writedowns? Deutsche Bank analyst Mike Mayo is. On the heels of Monday’s messy news from Merrill Lynch (MER), which sold a huge portfolio of collateralized debt obligations at a big loss and raised yet more capital to offset its latest round of mortgage-related losses, Mayo is forecasting that Citi (C) [...]

Housing News: Weakness, Weakness

(From NakedCapitalism.com)
The latest housing news is not pretty. The decline, however, was only slightly below the expected annualized level of 4.94 million units. From Bloomberg:
Sales of previously owned U.S. homes fell in June to the lowest level in a decade, signaling tumbling real-estate prices and consumer confidence are hurting demand.
Resales dropped 2.6 percent to a [...]

Fannie Mae Rolls Out Refi Plus

Fannie Mae has finished developing Refi Plus, a portfolio retention tool that was introduced in July.
The program allows borrowers to lock in rates for refinancing existing Fannie Mae loans up to two years in advance of the prepayment-period end date, in conjunction with supplemental financing.
The company feels the time is perfect for such a product, [...]

Wachovia Reports $9 Billion Loss…Dumps Wholesale Mortgage Business

Robert Steel has gone from putting out fires as Treasury undersecretary to facing a three-alarm blaze on his own block.
Steel was recently named chief executive of Wachovia, which has now reported a loss of nearly $9 billion for its second quarter and cut its dividend to nearly zero.
Wachovia has been roiled by the collapse [...]

Mortgages Get Harder To Qualify For

http://www.kiplinger.com/printstory.php?pid=14237
To qualify, you’ll need top-notch credit and solid financial resources.
By Pat Mertz Esswein
From Kiplinger’s Personal Finance magazine, August 2008
Ever since Wall Street lost its appetite for mortgage securities, the supply of money for home buyers and refinancers has been tight. The biggest remaining investors are the federally chartered corporations Freddie Mac and Fannie Mae, which [...]

Citi and Major Banks Stabilizing

http://www.portfolio.com/news-markets/top-5/2008/07/18/Citigroup-Narrows-Loss?TID=email/news/top5
Been Down So Long It Looks Like Up to Me, is the title of the novel by Richard Fariña. It could also describe how investors are looking at America’s biggest bank.
The bank had its third consecutive quarter in the red, reporting a $2.5 billion loss. It took another $7 billion of write-downs on top of [...]

Powerful Friends of Countrywide’s Mozillo Receiving Special Treatment

1.  Christopher Dodd
U.S. senator (Democrat, Connecticut); chairman, Senate Committee on Banking, Housing, and Urban Affairs1. May 3, 2002Loan type: RefinanceAmount: $388,991Rate: 7.38 percentProperty: Washington townhouse 2. June 16, 2003Loan type: RefinanceAmount: $275,042Rate: 4.5 percentProperty: Residence, East Haddam, ConnecticutV.I.P. Treatment: Three-eighths of a point waived, or $2,000; received free float-down from 4.875 percent to 4.5 percent3. [...]

U.S. To Face A Financing Crisis?

Merrill Lynch has warned that the United States could face a foreign “financing crisis” within months as the full consequences of the Fannie Mae and Freddie Mac mortgage debacle spread through the world.
The country depends on Asian, Russian and Middle Eastern investors to fund much of its $700bn (£350bn) current account deficit, leaving it far [...]

FANNIE MAE AND FREDDIE MAC BEING SUPPORTED BY

(From Portfolio.com)
World markets are cheering the U.S. government’s support for the mortgage giants Fannie Mae and Freddie Mac.  This morning, the dollar is rising, European stock markets are higher, and futures of U.S. stock indexes and even the futures for Fannie and Freddie are pointing to an opening rally.
“The U.S. authorities are doing everything they [...]