Obama Election Reviewed
Everyone is jumping in with there review and assessment of President-elect Obama. Here is what the financial services wonks are saying:
- Blown Mortgage is tracking Obama’s Housing Promises
- Henry Blodget on the Yahoo! TechTicker is noting Obama already reseting expectations
- Wall Street Journal is ttracking Economists reactions to Obama
- Paul Kedrosky says Wall Street doesn’t care
China Crash Debated
Economist Nouriel Roubini, noted economic doomsdayer often attributed with predicting the mortgage meltdown, is now forecasting a “Chinese Hard Landing.” His premise is that China’s dramatic economic explosion (bubble) fueled by an export economy could be dramatically popped by a collapsing US consumer. His sometime collaborator and economist colleague jumps in on the counterpoint.
Naked Capitalism covers the Chinese crash debate.
Troubled Asset Relief Program (TARP) Update
Treasury Department continues to explore way to deploy $700 billion TARP bailout (so much for the urgency of the crisis). Treasury-speak, akin to Fed-speak, greets Congress in their TARP update Tuesday:
“Treasury is committed to deploying the [Troubled Asset Relief Program] aggressively and is actively considering additional programs to strengthen financial institutions, restore the flow of lending, and address the many challenges to our financial markets posed by the ongoing housing correction,” the Treasury said in its report, delivered to Congress Tuesday.
At first pass I should be grateful for them being prudent in spending my taxpayer loan. However, my fear is that they are now grasping at things to do with the funds, and may be looking in the wrong direction:
Treasury is considering broadening the range of financial institutions in which it could purchase stakes to include bond insurance firms and specialty finance firms, said people familiar with the matter. And the Treasury, the Federal Deposit Insurance Corp. and other government agencies are said to be close to announcing a government program to address residential foreclosures at the root of the crisis.
The real solution may still be trapped in bureaucratic debate. FDIC Chair Sheila Bair’s plan for expediting the restructuring of trouble mortgages, loan modifications, similar to the plan she is currently executing at IndyMac Federal Bank may be running into insurmountable opposition:
Is the grand plan by FDIC Chairman Shelia Barr in trouble? Bair has been promoting a plan to use $50 billion of the Treasury’s $700 billion bailout funds to guarantee that home loans renegotiated by banks get repaid. Her proposal is modeled after FDIC efforts to quickly restructure troubled loans at IndyMac, the failed thrift that regulators seized in July. But it’s been nearly a week since the plan was first floated , and a story in the Wall Street Journal today suggests the plan has run into opposition in the White House.
Having said that, Bair may get a second shot at promoting her plan as Obama’s new Treasury Secretary.
Bank of England Slashed Rates
The UK and Europe are aggressively trying to stave of rapidly slowing regional economies that are slipping uncontrollably into recession. Bank of England dramatically issued a 1.5 percent cut, while the European Central Bank in a coordinated way issued a 0.5 percent cut to benchmark interest rates.
Wal-Mart Economic Indicator
My new favorite economic indicator of consumer confidence–Wal-Mart US same-store sales, excluding fuel, rose 2.4%. Not an a roaring economy yet, but life in consumer confidence that beat estimates by 0.4-1.0 percent.
Other Headlines that May Effect Your Mortgage Market
- Mortgage rates fell significantly on Wednesday
- Mortgage applications slump to 8 year lows
- GMAC buckling. Possible next bank implosion
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I am Bill Rice the Managing Editor of MortgageLoan.com. These are my morning notes. If you have comments, feedback, or pointers to something interesting email me or follow me on Twitter.
(photo credit: wetwebwork )
About Bill Rice