The subprime auto loan market isn't the only place where delinquencies are rising. New data shows foreclosures hitting their highest level in a year while the number of borrowers who have been foreclosed on twice has tripled since the housing bust.
It was not all smiles and jokes as Mario Draghi's European QE officially launched in Europe, with Greece leaving the proverbial turd in the monetary punch bowl.
Blackstone, who already may be your landlord, is reportedly close to buying the nation's second largest skyscraper in a $1.5 billion deal.
Chris Mayer: No Big Theme in US Stocks, Just “Special Situations and Quirky Opportunities” (Sprott’s Thoughts)Submitted by Sprott Money on 03/07/2015 07:16 -0400
There’s a big macro theme playing out in Europe – a once soft economic environment that allowed lots of inefficiency is becoming tougher and forcing companies to restructure, says Chris Mayer, author of Capital & Crisis and Mayer’s Special Situations.
Dalian Iron Ore prices have been cut in half in the last year (which must mean over-supply and not under-demand, right?). Amid China's growth target cut, Iron Ore prices there have crashed to below $60 - a record low - and that is having dramatic impacts across many regions. As we recently noted, Aussie gold miners are producing desperately to generate cashflow, but despite the booming housing market in some areas, as Reuters reports, the drop in iron ore and coal prices (the nation's 2 biggest exports) have led former boom towns to bust as "reality comes into the marketplace."
Some must watch financial documentaries
The question stands: how much longer will the Fed allow the ECB to export its recession to the US on the back of the soaring dollar, and how much longer will the market be deluded that "decoupling" is still possible despite a dramatic bout of weakness in recent US data. Look for the answer in today's BLS report, which - if the Fed is getting secound thoughts about its rate hike strategy in just 3 months - has to print well below 200,000 to send a very important message to the market about just how much weaker the US economy is than generally perceived. For now, however, the ECB is getting its way, and the question of just how much European QE is priced in, remains open, with peripheral bond yields dropping to new all time lows for yet another day, while the EURUSD has plunged to fresh 11 year lows, sliding below 1.094, and making every US corporation with European operations scream in terror. Looking at markets, US equities are just barely in the red, coiled to move either way when the seasonally-adjusted jobs data hits.
We have “early signs of new demand slowing” while “construction pricing is busting budgets beyond feasibility” in a market where “speculation abounds” in land pricing. When framed against a very unfavorable foreign exchange dynamic for the market’s most important buyers, the situation really couldn’t get much more precarious.
You wouldn't know it if you looked at the price of oil, but arguably the world's largest economy just unloaded a kitchen sink of fears, warnings, and downgrades on its economy; the most notable being:
*CHINA SETS 2015 GDP GROWTH TARGET AT ABOUT 7% (from 7.5% in 2014)
In a report to be delivered to the government tonight, Premier Li Keqiang warned China may face more economic difficulties in 2015 vs 2014 and downward economic pressure is still growing (despite Western 'analysts' proclaiming China fixed). The currency is weakening on the news and AsiaPac stocks are lower and as Chinese stocks open lower (despite hints at more easing), millions of newly minted "can't lose" Chinese investors begin to worry.
Who should you believe? Record stock market valuations and consensus spouting, highly paid economists who tell you all as is well...or oil, negative economic indicators, and your own eyes that this is just one more artificial boom desperately trying to run from the inevitable bust?
"Three big private equity firms — the Blackstone Group, Colony Capital and Cerberus Capital Management — are betting that so-called landlord loans to small and midsize investors will become the next big opportunity to profit from the rebound in the United States housing market. The private equity firms are providing financing indirectly to hundreds of real estate funds buying single-family homes, something that until recently was not widely available."
- RBS to cut up to 14,000 jobs in investment banking unit (FT)
- Doctors, patients scramble ahead of high court Obamacare decision (Reuters)
- Rajan Cuts India Rates After Modi Agrees to Inflation Target (BBG)
- Russia’s Putin Makes First Public Comments on Killing of Boris Nemtsov (WSJ)
- House breaks impasse, passes security funding without provisions (Reuters)
- How a 25-Year-Old Investor Spurred Lumber Liquidators’ Plunge (BBG)
- Jeff Immelt’s Overhaul of GE Impeded by Falling Oil Prices (WSJ)
- Sahara India Defaults on Luxury Hotel Loans From Bank of China (BBG)
Just in time for both total auto loans and total student debt outstanding to top the $1 trillion mark, we get a match made in FICO hell as the subprime lending unit of AIG Springleaf, has purchased OneMain, another subprime lender that’s been relegated to Citi’s Citi Holdings trash bin for years. The deal creates a subprime lending powerhouse with some $14 billion in possibly-not-toxic receivables.
The 2008 worldwide financial crisis was produced due to excessively easy monetary policy, which caused the largest debt driven mal-investment in housing, automobiles, and Chinese produced crap in world history. The consequences of this debt bacchanalia should have been the orderly liquidation of the Wall Street entities that created the crisis, the writing off of trillions in bad debt, corporate and personal bankruptcies of businesses and people who borrowed recklessly, a sharp steep economic decline to cleanse the excesses, and politicians who immediately began the process of reducing budgets and addressing long term unfunded unpayable liability promises. Instead, the psychotic oligarchs did not want to lose any of their power, wealth or control over the proletariat. They have done the exact opposite of what needed to be done.