The banks are no longer making home equity loans. Therefore people aren't building an addition or making big improvements. The impact on the small contractors has been big. The impact to the illegal workers has been bigger. One story.
Sulfuric acid is a backbone commodity for the economy. If you think the Vol. on oil is high take a look at the price action for this stuff. What's next is the big question. The current price is at a five year low. Looking at history it could be 300% higher in a year.
More tough talk from a Fed Governor. The problem with talking tough is if you do not back it up with action you look soft. If that is the way this plays out the weak link is still the dollar. If they raise rates as they say they will it is going to dramatically increase the cost of funding the mega-trillions of short term debt that Geithner has floated on our behalf.
One of Timmy G's smaller responsibilities is the $60 billion Federal Financing Bank. They're doing a "heck of a job". My bet is it's going to cost us one way or the other. The FFB might be the new lender to the FDIC. It looks like they have already filled out the loan forms. Sheila B. will love the pricing. They are giving the money away.
Fed Governor Warsh wrote his 'Blog'on QE. He may have penned the words, but not without Bernanke's approval. This was intended to calm the concerns over QE. It did not work for me.
What do you have to do to make $675,000 at Freddie Mac? Not much. Why is the gigantic piece of dead wood hiring big buck talent? Big money politics, of course.
NOTE: AFTER I WROTE THIS ADDITIONAL DETAILS CAME OUT: KARI GOT A $2MM BONUS AND A GUARANTEE OF $3.75MIL!!!!
If the budget deficit is $1 trillion per year, how much do we have to borrow? The answer is closer to $2 Trillion. The existing debt has to be refinanced too. Can this be sustained? Forever?
FHA announced last week that they were having some problem with their reserve levels. Making 100% loans in Puerto Rico might be part of the problem. Ski resorts may be another issue for the folks at FHA to worry about.
Senator "Johnny" Isakson from Atlanta wants to juice up the subsidy for home buyers. How much is this one going to cost us? Does the Senator have an axe to grind?
The SSTF pointed me to their web site. They provide information regarding the range of alternatives available to "fix" the problem. In my view they have come up with nothing that will work.
The stock market values companies based on earnings. Residential real estate is no different these days. So what's your home worth? Based on this simple calculation it may be lower than you think.
By my count the D.C. mortgage lenders have upward of $1 trillion of loans on their books that were made to achieve social objectives. This has been 'play money' for Congress and past Administrations for years. The boss at FHFA has told Congress this has to stop. Where are chips going to fall on this one?
