Basis Point contributor Julian Hebron was quoted in a MarketWatch story yesterday about how to handle HELOC freezes. All year, banks have been freezing Home Equity Lines of Credit in big waves. It’s a way to protect themselves from dropping home prices and also a way to free up limited capital that would otherwise have
June 2008
Fixed and ARM rates open this week approximately even over last week. We had a run up in rates in the two weeks leading up to last Wednesday’s FOMC announcement that they were holding the overnight bank-to-bank Fed Funds Rate at 2%, but increased credit crunch pressures have weighed on the market. As stocks have
Last week, I discussed possible outcomes of the Goldman Sachs audit of Wachovia’s loan portfolio. Goldman was just hired, and already this week Wachovia announced that they’re discontinuing the negative amortization option on their Option ARMs. This is the case I was making when discussing it last week. Option ARMs have come to be defined
STATE OF MORTGAGE BANKING Parent’s like to think that their son or daughter might go into the same profession in which they work. I got my son’s report card in the mail on Saturday, and three teachers had written comments about him. They were, “Since my last report, your child has reached rock bottom and
Retuers reported Friday that UBS might sell Paine Webber after a review that investment bank Lazard, whose chief Bruce Wasserstein also advised it on its acquisition of Paine Webber in 2000, is conducting between now and October. Back then, UBS had just finished integrating money management operations into one single Global Asset Management division by
“What’s good for big oil is good for America” proclaimed Stephen Colbert as he opened his new segment: The Tank is Half Full. A wise play since oil prices broke the $140 mark this week, and the trend is unlikely to abate with increasing demand from emerging markets. While the rest of us go broke
The Consumer Price Index is probably the most widely watched consumer inflation gauge, but the Fed watches Personal Consumption Expenditures the closest and May PCE came in at +0.1% versus expectations of +0.2%. This is a “core” reading which excludes food and energy expenditures, and it brought the May-to-May inflation rate to 2.1%. Given the
Waiting for that big inheritance? Don’t hold your breath. According to figures compiled by the Tiburon Strategic Advisors and the Wall Street Journal, and published in their Saturday June 14th edition, 25% of workers believe that they will need less than $250,000 for retirement (although 23% have a goal of having $500-$999k). The median value
Existing Home Sales for May were in line with expectations, with an annualized rate of 4.9 million units sold, putting the inventory supply at 10.9 months. One-third of these, 1.65 million annualizedwere distressed properties: According to the Realtors, a full one third of sales are distressed properties. Think about that. Five million home sales expected
Yesterday, we started to explore what’s next for BofA after the Countrywide deal closes. That was more in the context of loan products and distribution channels, and we’ll continue to report on that going forward. For today, it was announced that BofA would cut 7500 jobs after the deal closes, with most cuts coming in
It’s been awhile since emails from an Algerian princes offered untold riches in exchange for your name, social security number and bank wire instructions. That’s unfortunate because most of us could certainly use untold riches in this wintry economic climate. But it looks like our luck is changing, see the email that just came through
Berkshire Hathaway CEO and market oracle Warren Buffett Told CNBC today that U.S. inflation is “exploding” … such a statement from a credible source makes a great headline. Will it surpass the Fed decision (see our previous story from today on Fed rate decision and discussion of inflation) in it’s market influence? Hasn’t so far,
Following their June 24-25 meeting today, the Federal Open Market Committee kept the Fed Funds Rate at 2% and the Discount Rate at 2.25%, and said that “uncertainty about the inflation outlook remains high,” and “upside risks to inflation and inflation expectations have increased.” This is a slight shift from their April 30 meeting where
A majority 69% of Countrywide shareholders voted today to approve takeover of the company by Bank of America. Countrywide will drop the name in short order and is likely also to drop many product lines. According to Bloomberg: The combined companies will handle 25 percent of U.S. mortgage originations and a 17 percent share of
Is California on fire? It sure seems that way, with over 1,000 individual fires! And here is the latest story on a subject that always rouses a spirited debate: if one could pay off their mortgage, should they? MARKET UPDATE OK, if house prices in many markets are continuing to decline, and Consumer Confidence, based
Wachovia, the last name-brand player besides Countrywide still active in neg-am Option ARMs, has hired Goldman Sachs to evaluate its loan portfolio. Wachovia’s slogan on their wholesale broker rate sheets is “We Lend Our Own Money, We Make Our Own Rules.” That seems likely to change as outsiders exert more influence over the process. But
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