Federal Reserve — Morning Mortgage Notes

Federal Reserve Growing Fat on Mortgage Bonds

July 16, 2010 By Editor Leave a Comment

Image via Wikipedia Mortgage-backed securities took the US economy to the brink of total collapse when US bank over stuffed themselves with these assets. Attracted by the siren song of high yields and illusions that real estate always appreciate and homeowners never default in huge numbers, they learned the folly of their assumptions. Is the US Federal Reserve headed down the same road? Recently released Fed data shows that their balance sheet has grown to $2.324 trillion, mostly fueled by … [Read more...]

Taking Another Look at Bailout "Income" Sheet

September 2, 2009 By Bill Rice Leave a Comment

Matt Taibbi at TrueSlant.com takes a slightly different view of the success of Bank Bailouts. Citing reports from the New York Times and the Financial Times, "telling us the bailout is working because the government has made some money on TARP," Taibbi thinks the math is selective at best. Take a look a Matt's argument for yourself: "This is sort of like calculating the returns on a mutual fund by only counting the stocks in the fund that have gone up. Forgetting for a moment that TARP is … [Read more...]

Filed Under: Federal Reserve, TARP Tagged With: bailout, banks, Federal Reserve, TARP

Is Federal Reserve Chairman Bernanke Campaigning for Re-election (Reappointment)?

July 27, 2009 By Bill Rice 3 Comments

Image via Wikipedia I would have to agree with a few of these sources--Chairman Bernanke is off and running on his reappointment campaign. Washington Post: Televised townhall meeting in Kansas? That was the unusual format for PBS' Jim Lehrer special with Chairman Ben Bernanke: Using atypically folksy language, Bernanke explained why he thinks the central bank responded appropriately to the financial crisis. "I was not going to be the Federal Reserve chairman who presided over the second … [Read more...]

Filed Under: Federal Reserve

Federal Reserve Board Wants Mortgage Broker Fee Restrictions

July 24, 2009 By Bill Rice Leave a Comment

Interesting... Federal Reserve Board is doing consumer marketing studies now. In reaction to consumer testing the Fed is resubmitting a proposal to change Regulation Z, more commonly known as the Truth in Lending Act (TILA). Please, read more and then come back and register you opinions in the comment section below. Housing Wire: Fed Proposes Fee Restrictions on Mortgage Brokers The Fed’s proposal would prohibit payments to a mortgage broker or loan officer that are based on the interest rate … [Read more...]

Filed Under: Federal Reserve

Small Bank Bailouts, The Great Recession, JP Morgan Loan Modifications, Global ZIRP, PMI Losses, GM No Bailout Merger

November 3, 2008 By Bill Rice Leave a Comment

Small Bank Bailouts Financial market calamity was narrowly averted today as Farmers National Bank of Emlenton is expected to get a much needed capital injection from the US government. William Marsh, CEO led with this, "they were giving out free stuff"-type quote in the WSJ: "It seemed like the consensus in the industry was...go out and get this," said William Marsh, president and chief executive of Farmers National Bank of Emlenton, in Emlenton, Pa. Mr. Marsh said his bank is healthy and viable … [Read more...]

Filed Under: Economy, FDIC, Federal Reserve, Foreclosure, Housing Prices, Mortgage Rates, PMI, Politics, Treasury, US Banks Tagged With: bailout, gm, jp morgan, Loan Modification, PMI, recession, small banks, zirp

GDP, Mortgage Bonds, Zero Interest Policy, Renters for Obama, Stop Being Bearish

October 30, 2008 By Bill Rice Leave a Comment

GDP Swings Low, Sweet ... Well it is official, we're contracting. Consumers are hoarding their cash (taking queues from the banking sector). Unlike the recession of 2001 consumers will not be borrowing their way through hard time--try to find a home equity line of credit these days. They're calling it a recession: “This is the first of a run of negative G.D.P. numbers,” said Ian Shepherdson of High Frequency Economics. “The economy is in recession.” He predicted that the economy would shrink … [Read more...]

Filed Under: Economy, Federal Reserve, Mortgage Notes, Mortgage Rates, Politics, Wall Street Tagged With: bear market, fed, gdp, google, mortgage bonds, Mortgage Rates, obama, recession, renters, zero interest policy

Fed Lowers Rate 0.5% to 1%, But is There More?

October 29, 2008 By Bill Rice Leave a Comment

Aaron Task presents a great Fed premonition. The Fed might not be done. In fact, it seems pretty clear they are locked into a recessionary outlook and few ideas for a short-term recovery. Recent policy actions, including today’s rate reduction, coordinated interest rate cuts by central banks, extraordinary liquidity measures, and official steps to strengthen financial systems, should help over time to improve credit conditions and promote a return to moderate economic growth. Nevertheless, downside … [Read more...]

Filed Under: Central Bank, Economy, Federal Reserve, Mortgage Notes Tagged With: fed, fomc, interest rates

Mortgage Rates, Misery Index, Foreclosures, Case Shiller, OPEC, Credit Default Swaps

October 29, 2008 By Bill Rice Leave a Comment

Mortgage Rates Rise as US Market Soars We get a big, even historic, upward bounce in the US stock market. Meanwhile mortgage rates are taking a negative bounce. The interesting part is that one of the stated US government bailout objectives was to preserve or even increase mortgage affordability. However, these same interventions into markets are causing precisely the opposite (possibly short-term) effect: With so much government debt guarantees in the bond market yield spreads between mortgage bonds … [Read more...]

Filed Under: Commercial Paper, Economy, Federal Reserve, Foreclosure, Housing Prices, Mortgage Rates Tagged With: case shiller, credit default swaps, Foreclosure, Housing Prices, misery index, Mortgage Rates, opec

Moral Hazards, Too Small to Fail, Mark-to-Market, Bernanke and Obama, P2P Lending

October 21, 2008 By Bill Rice Leave a Comment

When Lenders and Investors Objectives Aren't Aligned The Big Picture does a nice summary of how disconnects between lender and investor alignments can create moral hazard on the scale of mortgage implosion and financial market meltdown. Overstructuring risk mitigation combined with dangerously low interest rates makes credit feel like cash, debt like wealth. And, here we are... Seth Godin Reminds Us There is "Too Small to Fail" A great little post about the value of being small. It doesn't imply … [Read more...]

Filed Under: Central Bank, Economy, Federal Reserve, Politics, Venture Capital Tagged With: accounting, bernanke, howard lindzon, mark-to-market, moral hazard, obama, p2p lending, seth godin, small business, social lending, Venture Capital

Weekend Notes

October 18, 2008 By Bill Rice Leave a Comment

Weekend Read File: Will economic collapse hurt contracts for baseball players? Time to Clean Up After the Party An Example of Economics at Work Bernanke is Fighting the Last War Churchill's Dictum and Henry Paulson PIMCO's Gross sees market confidence restored 'in weeks' on bank rescue (this guy is incredible-sarcasm in voice) Have we learned the right lessons from the Great Depression? Mark Cuban helping to watchdog our tax dollars Sequoia tells portfolio companies to hunker down (presentation … [Read more...]

Filed Under: Economist, Economy, Federal Reserve, Venture Capital Tagged With: baseball, bernanke, churchill, economics, great depression, gross, mark cuban, pimco, regulation, sequoia