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Bailout Blog Posts from November 19, 2009

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Bailout Posts (November 19, 2009)

Counterparties

Jonathan Ford and Peter Thal Larsen on how to shrink the banks -- Prospect
Posted on Macroprudential on November 19, 2009 at 11:56 PM

There was some buzz earlier today about short term T bill rates turning slightly negative. This happened last year too, but for different reasons ...From the Financial Times: Short-term US interest rates turn negative Short-term US interest rates turned negative on Thursday as banks frantically stockpiled government securities in order to polish their
Posted on Calculated Risk on November 19, 2009 at 10:30 PM

States: Seriously Delinquent Mortgages vs. Unemployment Rate

Here is a scatter graph comparing the seriously delinquency rate for mortgage loans vs. unemployment rate for all states. The seriously delinquent rate include 90+ days delinquent loans, and loans in the foreclosure process for Q3 2009 (Source: MBA). Click on graph for larger image in new window.There is a relationship between delinquency rates
Posted on Calculated Risk on November 19, 2009 at 7:45 PM

Mortgage Delinquencies and Foreclosures by Period Past Due

Click on graph for larger image in new window.First, on the market ...This graph is from Doug Short of dshort.com (financial planner): "Four Bad Bears". Note that the Great Depression crash is based on the DOW; the three others are for the S&P 500.Reader Yuri asked me if the number of 30 day delinquencies is decreasing. He was curious if the ov
Posted on Calculated Risk on November 19, 2009 at 4:49 PM

Disclosing journalists? pasts

Dear Henry, I'm not annoyed by you! How could I be, when you call me the "king of financial bloggers" no fewer than four times in one piece? I think you've created a powerful, innovative, and disruptive franchise in The Business Insider, which employs some very smart people and publishes some great journalism -- even if sometimes it's neither checked n
Posted on Macroprudential on November 19, 2009 at 4:00 PM

The unbearable pain of 0.01%

Bill Gross isn't earning much interest on his cash: in fact, he's only earning 0.01%. Tell us, Bill, what's an appropriate metaphor to explain how it feels to earn such a low interest rate?
Posted on Macroprudential on November 19, 2009 at 3:08 PM

Overdraft opt-in messages: Brace yourselves

It's good that we're moving to an opt-in system for debit-card overdrafts. But in order to get there from here I have a feeling that we're going to have to dodge a lot of, um, personalized communications from our banks:
Posted on Macroprudential on November 19, 2009 at 2:30 PM

Hotel RevPAR off 15.7 Percent

From HotelNewsNow.com: New Orleans leads ADR, RevPAR declines in STR weekly numbers Overall, in year-over-year measurements, the industry?s occupancy fell 6.4 percent to end the week at 52.6 percent, ADR dropped 9.9 percent to US$95.86, and RevPAR decreased 15.7 percent to finish at US$50.47. Click on graph for larger image in new window.This gr
Posted on Calculated Risk on November 19, 2009 at 2:14 PM

How to slow down foreclosures

Buried in Peter Goodman's 2,300-word tale of Christopher Hall's foreclosure woes is a gem of a program in Philadelphia:
Posted on Macroprudential on November 19, 2009 at 1:41 PM

MBA Forecasts Foreclosures to Peak in 2011

On the MBA conference call concerning the "Q3 2009 National Delinquency Survey", MBA Chief Economist Jay Brinkmann said this morning: The problem is moving to prime loans, including fixed rate prime loans, and also FHA loans. "We are seeing the first hit on the weaker prime fixed borrowers." Remember the delinquency rate includes loans in modification
Posted on Calculated Risk on November 19, 2009 at 12:08 PM

Navigating the news

The indispensable Abnormal Returns has a smart post up on aggregation:
Posted on Macroprudential on November 19, 2009 at 11:56 AM

MBA: Record 14.4 Percent of Mortgage Loans in Foreclosure or Delinquent in Q3

The MBA reports a record 14.4 percent of mortgage loans were either one payment delinquent or in the foreclosure process in Q3 2009. This is an increase from 13.2% in Q2 2009. From the MBA: Delinquencies Continue to Climb in Latest MBA National Delinquency Survey The delinquency rate for mortgage loans on one-to-four-unit residential properties rose
Posted on Calculated Risk on November 19, 2009 at 11:00 AM

Fire the lot of ?em!

John Hudson has an interesting round-up of responses to the signs of humanity from Goldman Sachs on Tuesday: I'm definitely the outlier in a sea of commentators saying that they're tiny, meaningless, and an attempt to deflect attention from the bigger issues surrounding the bank.
Posted on Macroprudential on November 19, 2009 at 10:12 AM

Weekly Initial Unemployment Claims: 505,000

The DOL reports on weekly unemployment insurance claims:In the week ending Nov. 14, the advance figure for seasonally adjusted initial claims was 505,000, unchanged from the previous week's revised figure of 505,000. [Revised from 502,000] The 4-week moving average was 514,000, a decrease of 6,500 from the previous week's revised average of 520,500. ..
Posted on Calculated Risk on November 19, 2009 at 9:30 AM

Counterparties

Everything you ever wanted to know about delta-hedging and options vs cash equities strategies -- TITGR
Posted on Macroprudential on November 19, 2009 at 1:19 AM

The Failure of Regulatory Oversight

This is a recurring theme: a bank fails, the Inspector General reviews the failure and discovers that the field examiners saw problems starting around 2002, and ... nothing happened for years.We saw this with the Federal Reserve and the failure of Riverside Bank of the Gulf Coast, and with the FDIC / OTS and the failure of IndyMac.Eric Dash at the NY T
Posted on Calculated Risk on November 18, 2009 at 11:33 PM

MBA: Purchase Applications Fall to 12 Year Low

Another busy day and I skipped the MBA market index earlier ... note: The MBA Q3 delinquency report will be released tomorrow.The MBA reports: Mortgage Applications Decrease in Latest MBA Weekly SurveyThe Market Composite Index, a measure of mortgage loan application volume decreased 2.5 percent on a seasonally adjusted basis from one week earlier. ...
Posted on Calculated Risk on November 18, 2009 at 9:30 PM

Democratizing art

I had a very interesting lunch with Jen Bekman of 20x200 last week -- a woman who has just raised $825,000 in venture funding to help expand her project of bringing art to everybody. "I want anyone who's educated and even remotely affluent to feel self-conscious if they don't have an art collection that they can talk about," she says, and to that end s
Posted on Macroprudential on November 18, 2009 at 7:29 PM

One million Workers to Exhaust Unemployment Benefits in January

"It's d�j� vu all over again". Yogi BerraFrom the NY Times (edit): Jobless Benefits Set to Expire Unless Congress Acts About one million laid-off workers will see their unemployment benefits end in January ...The [recently] added federal benefits were built on a series of previous extensions that are slated to end on Dec. 31 ... According to projecti
Posted on Calculated Risk on November 18, 2009 at 6:42 PM

Housing Leads the Economy, Existing Home Sales are Irrelevant

After reading some of the commentary regarding the housing starts report this morning, it might be useful to reiterate these three points: Residential investment is the best leading indicator for the economy. Residential investment will not recover rapidly because of the large overhang of existing vacant housing units. Existing home sales are largely
Posted on Calculated Risk on November 18, 2009 at 4:30 PM

Kicked out of finance, and into journalism

Up until yesterday, Michael Whitney was a presenter on Bloomberg TV; he would occasionally get his byline on Bloomberg News stories. Whitney was fined $55,000 last year by the CFTC and is subject to a permanent injunction, after being charged with false reporting and attempting to manipulate natural gas prices.
Posted on Macroprudential on November 18, 2009 at 4:13 PM

Quarterly Housing Starts and New Home Sales

The Census Bureau has released the "Quarterly Starts and Completions by Purpose and Design" report for Q3 2009. Monthly housing starts (even single family starts) cannot be compared directly to new home sales, because the monthly housing starts report from the Census Bureau includes apartments, owner built units and condos that are not included in the
Posted on Calculated Risk on November 18, 2009 at 2:56 PM

How US investors can play the carry trade

When I wrote my blog entry on currency ETCs yesterday, I wasn't aware of the various carry-trade products available on US exchanges. But after a very informative conversation with Morningstar's Bradley Kay this morning, I'm now much more up to speed. And while there's nothing in the US quite like the UK products, there are still a fair few carry-trade
Posted on Macroprudential on November 18, 2009 at 2:40 PM

Providing credit to the poor

Megan McArdle is cutting up her credit cards, but she doesn't want to force anybody else to do the same thing. She responds to my sentiment that credit should come from loans, not cards, thusly:
Posted on Macroprudential on November 18, 2009 at 1:17 PM

Falling Rents and Minneapolis

From the BLS report on the Consumer Price Index this morning: The rent index decreased 0.1 percent, the index for owners' equivalent rent [OER] was unchanged ... The rent index decreased at a -1.3% annualized rate, and OER declined in three of four ranges (only the Northeast Urban Region saw an increase - see Cleveland Fed). The rent index and OER will
Posted on Calculated Risk on November 18, 2009 at 12:25 PM

How the AIG bailout scuttles chances for a second stimulus

Paul Krugman is right to be worried about the unintended consequences of the AIG bailout:
Posted on Macroprudential on November 18, 2009 at 12:08 PM

Ben Stein?s sleazy paymasters, cont.

Fl�neur points me to the 35-page staff report for Jay Rockefeller on "Aggressive Sales Tactics on the Internet". It concentrates on three extremely sleazy companies, all based in Norwalk, Connecticut: Affinion, Webloyalty, and our old friends Vertrue, the employers of Ben Stein. Here's a typical datapoint:
Posted on Macroprudential on November 18, 2009 at 10:36 AM

AIA: Architecture Billings Index Shows Contraction

From the American Institute of Architects : Index remains in negative category despite improvement Amidst a continued high level of inquiries for possible new projects, the Architecture Billings Index (ABI) reached its highest mark since August 2008, just before the serious credit problems emerged in our economy. As a leading economic indicator of cons
Posted on Calculated Risk on November 18, 2009 at 10:30 AM

Housing Starts Decline Sharply in October

Click on graph for larger image in new window.Total housing starts were at 529 thousand (SAAR) in October, down 10.6% from the revised September rate, and up from the all time record low in April of 479 thousand (the lowest level since the Census Bureau began tracking housing starts in 1959). Starts had rebounded to 590 thousand in June, and ha
Posted on Calculated Risk on November 18, 2009 at 9:30 AM

Counterparties

Who sold credit protection on AIG to Goldman Sachs? They're a huge and unknown beneficiary of the bailout -- NYT
Posted on Macroprudential on November 18, 2009 at 1:10 AM

California Still Faces Large Budget Deficit

From the LA Times: California faces a projected deficit of $21 billion Less than four months after California leaders stitched together a patchwork budget, a projected deficit of nearly $21 billion already looms, according to a report to be released Wednesday by the state's chief budget analyst.The new figure -- the nonpartisan analyst's first projecti
Posted on Calculated Risk on November 18, 2009 at 12:59 AM

2009-11-19 Posts in other Subject Areas

Academic (197), Criminal Law (187), Legal News (171), Legal Commentary (134), Legal Research (92), Religion & Law (89), Personal Injury Law (85), International Law (85), Intellectual Property Law (60), Loan Modification (58), Litigation (57), Labor & Employment Law (42), Real Estate & Property Law (39), Federal Judiciary (32), Bailout (31), Taxation & Estate Planning (28), Indiana (27), Celebrity Law (26), Miscellaneous (22), Constitutional Law (22), Corporate & Securities Law (22), Legal Writing (20), Patent Law (20), Ethics (20), Estate Planning (18), Election-Campaign Law (18), Politics (18), Bankruptcy (17), Law Students (17), Legal Niches (16), Law Humor (15), Family Law (15), Copyright Law (15), Kentucky (14), Consumer Law (11), Media & Entertainment Law (10), In-House Counsel (9), Corporate Governance (9), Legal History (9), Law Technology (9), Immigration Law (9), Legal Marketing & PR (8), Paralegals & Legal Secretaries (8), Health Law (8), Florida (7), Class Action (5), Disability Law (4), Ohio (4), Environmental Law (4), Law School (3), New Law Blogs (3), Bar Associations (3), Local Law Blogs (3), Massachusetts (3), Legal Journals (3), Practice Management (3), Education Law (3), Public Defense (3), State Courts (3), Personal Blogs (3), New York (2), Banking Law (2), Bad Cops & Prosecutors (2), Careers (2), Energy Law (2), Legal Malpractice (2), Elder Law (1), Solo Practice (1), Obama Citizenship (1), Persaonl Blogs (1), Appellate Law (1), Michigan (1), Arbitration & Mediation (1), Litigation Support (1), Trademark Law (1),