It's just like tossing a hot stone to the person on the right of you...it's too hot for you to hold and too hot for them to hold....no one is going to do anything with it....

http://www.timesunion.com

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Feds announce plan to delay foreclosures

Associated Press
Tuesday, February 12, 2008

WASHINGTON -- Homeowners threatened with foreclosure would in some instances get a 30-day reprieve under an initiative the Bush administration announced Tuesday.
     
Dubbed "Project Lifeline," the program will be available to people who have taken out all types of mortgages, not just the high-cost subprime loans that have been the focus of previous relief efforts.
The program was put together by six of the nation's largest financial institutions, which service almost 50 percent of the nation's mortgages.
These lenders say they will contact homeowners who are 90 or more days overdue on their monthly mortgage payments. The homeowners will be given the opportunity to put the foreclosure process on pause for 30 days while the lenders try to work out a way to make the mortgage more affordable to homeowners.
"Project Lifeline is a valuable response, literally a lifeline, for people on the brink of the final steps in foreclosure," Housing and Urban Development Secretary Alphonso Jackson said at a joint news conference with Treasury Secretary Henry Paulson.
He said the goal was to provide a temporary pause in the foreclosure process "long enough to find a way out" by letting homeowners and lenders negotiate a more affordable mortgage.
Paulson said the new effort was just one of a number of approaches the administration was pursuing with the mortgage industry to deal with the country's worst housing slump in more than two decades.
In December, President Bush announced a deal brokered with the mortgage industry that will freeze certain subprime loans -- those offered to borrowers with weak credit histories -- for five years if the borrowers cannot afford the higher monthly payments as those mortgages reset after being at lower introductory rates.
"As our economy works through this difficult period, we will look for additional opportunities to try to avoid preventable foreclosures," Paulson said. "However, none of these efforts are a silver bullet that will undo the excesses of the past years, nor are they designed to bail out real estate speculators or those who committed fraud during the mortgage process."
In coming days, lenders will begin sending letters to homeowners who might qualify for the new program. Homeowners won't qualify if they have entered bankruptcy, if they already have a foreclosure date within 30 days, or if the home loan was taken out to cover an investment property or a vacation home.
The Mortgage Bankers Association reported that at least 1.3 million home mortgage loans were either seriously delinquent or in foreclosure at the end of the July-September quarter.
Private economists are forecasting that the number of foreclosures could soar to 1 million this year and next, about double the 2007 rate.
Officials did not have an estimate of how many people might be helped by the new "Project Lifeline" program.
Democratic critics said the administration was still not doing enough to help with a serious crisis that has slowed the overall economy to a near standstill and raised worries about a full-blown recession.

In a statement, Sen. Hillary Rodham Clinton, who is running for the Democratic presidential nomination, said that last year she had called for a 90-day moratorium on subprime foreclosures. She said the administration has been slow to react to the unfolding crisis.
"The administration's latest initiative is welcome news, but more remains to be done," she said in a statement.
Senate Banking Committee Chairman Christopher Dodd, D-Conn., said the finance industry and the administration were falling further and further behind in dealing with the growing crisis.
"This plan, while a step in the right direction, will not stem the tide of the millions of foreclosures we are facing in the coming months," Dodd said in a statement. His committee will hold a hearing on the housing crisis on Thursday with testimony from Paulson and Federal Reserve Chairman Ben Bernanke.
The six participating banks are Bank of America Corp., Citigroup Inc. Countrywide Financial Corp., J.P. Morgan Chase and Co., Washington Mutual Inc. and Wells Fargo & Co.
They are all members of the Hope Now Alliance, an industry group that is trying to coordinate a response to the mortgage crisis. Officials urged homeowners to call the group's toll free hot line number at 1-888-995-HOPE for assistance.

Okay...let's just keep bailing out the people who don't know how to read their contract before they signed it. And let's keep bailing out the people who didn't take English class so they didn't know what 'your interest rate will go up and so will your payments', means. And lets keep bailing out the people who just plain old overspend!!

The 'carpet' is almost out---pay attention to GM and the other biggies....they all invest in each other and in real estate/banking......

http://www.dailygazette.com

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Fed chief offers bleak report Testimony signals more rate cuts
BY MARTIN CRUTSINGER The Associated Press

    WASHINGTON — Using words such as “sluggish” and “deteriorated,” Federal Reserve Chairman Ben Bernanke gave a starkly pessimistic assessment of the nation’s economy on Thursday and signaled that the Fed will cut interest rates further if needed to combat the adverse effects of a prolonged housing slump and a severe credit crisis.
    Both Bernanke and Treasury Secretary Henry Paulson told a congressional hearing that the economy could still avert a full-blown recession, but Democrats said they believed the government should be doing much more to help millions of Americans cope with a threatened tidal wave of mortgage foreclosures.
    Bernanke told the Senate Banking Committee the serious housing slump and a credit crisis triggered by rising defaults in subprime mortgages had greatly strained the economy.
    “The outlook for the economy has worsened in recent months and the downside risks to growth have increased,” Bernanke told the committee. “To date, the largest economic effects of the fi - nancial turmoil appear to have been on the housing market, which, as you know, has deteriorated significantly over the past two years or so.”
    Bernanke noted that hiring has slowed with job creation falling by 17,000 in January, the fi rst such setback in more than four years. He said the weaker labor market along with recent declines in stock prices and declining home prices were likely to be a drag on consumer confidence going forward.
    The Fed chief told senators the “virtual shutdown” of the market for subprime mortgages given to people with blemished credit histories or low incomes — and a reluctance by skittish lenders to make “jumbo” home loans exceeding $417,000 — have aggravated problems in the housing market. “Further cuts in homebuilding and in related activities are likely,” he said.
    Bernanke said that in his own economic forecast he did not predict a recession but a period of sluggish growth “followed by a somewhat stronger pace of growth starting later this year” as the impacts of the Fed’s rate cuts and the $168 billion economic stimulus package of tax rebates begin to be felt.
    However, he also said there were significant downside risks ranging from the threat that the housing slide could become even more severe, the job market could deteriorate more than currently expected or that the credit squeeze will intensify. He said the Fed would be monitoring the economy closely and would “act in a timely manner as needed to support growth and provide adequate insurance against downside risks.”
    On Wall Street, Bernanke’s comments pushed stocks lower. The Dow Jones industrials closed down 175.26 points at 12,376.98.
    Private economists said they viewed Bernanke’s sober assessment as a clear signal that the Fed, which cut interest rates by 1.25 percentage points in two moves in January, is prepared to cut rates further.
    Brian Bethune, an economist at the private forecasting firm Global Insight, said he looked for bold half-point cuts at the Fed’s next two regular meetings on March 18 and April 30. He said that what came out “loud and clear” from Bernanke’s testimony was an increased concern about the stresses to the financial system from the credit crisis.
    While saying that housing represented the greatest threat to the economy, Paulson, who testifi ed along with Bernanke and Christopher Cox, chairman of the Securities and Exchange Commission, said he did not believe the economy would fall into a recession. He said the administration was working now to make ensure the government checks ranging from $300 to $1,200 were sent out without delay starting in May.
    That stimulus package, which Congress passed last week, is expected to give the economy a sizable jolt in the second half of this year although many economists believe it will be too late to keep the economy from recording two consecutive quarters of negative economic output, the classic definition of a recession.
    Pressed to say what more the administration plans to do, especially in dealing with a threatened wave of mortgage foreclosures, Paulson said he continued to look for good ideas but at the moment did not see the need to do any more than such current efforts as encouraging the mortgage industry to freeze rates on some subprime mortgages for five years and offering a 30-day reprieve on foreclosures for homeowners seriously behind on their payments to give them time to try to work out a loan modification with their lenders.
    But a group of Senate Democrats said those efforts fell far short of what is needed. They announced outside of the hearing that they were introducing a second stimulus measure that would have a variety of initiatives to help stem foreclosures including providing $4 billion in new community development grants to purchase and rehabilitate foreclosed properties.
    “If we really want to tackle the economic problems the country is facing, we must address the housing crisis that got us here,” said Sen. Charles Schumer, D-N.Y., a supporter of the new stimulus measures.
    Senate Banking Committee Chairman Chris Dodd, D-Conn., told reporters after the hearing that he planned to explore a proposal to create a Homeownership Preservation Corp. that would buy mortgages at steep discounts from mortgage firms and banks and then rework the loans based on the reduced value of the properties, making the payments more manageable.
    Dodd told Bernanke, Paulson and Cox that he believed all three of their agencies needed to do more to help deal with what he called a “crisis of confidence.”
    Sen. Robert Menendez, D-N.J., criticized policymakers for what he believed was a too slow response to the housing crisis. “We count on those at the top … to sound an alarm,” during a crisis, he said. Instead, “what we got was a snooze button … we’ve been behind the curve.”

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Sen. Robert Menendez, D-N.J., criticized policymakers for what he believed was a too slow response to the housing crisis. “We count on those at the top … to sound an alarm,” during a crisis, he said. Instead, “what we got was a snooze button … we’ve been behind the curve.”

You dont sound an alarm during a crisis....duh.......Ya'll saw the curve and refused to edumacate.....ya'll were with Whitewater and enjoying yourselves.....

http://www.dailygazette.com

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Mortgage mess spurring lawsuits Regulators hope to punish banks, lenders for their roles
BY MARK JEWELL The Associated Press

    BOSTON — Regulators are trying to punish Wall Street for mortgage finance practices that expanded home ownership and spread risk among a host of new players — but also may have duped borrowers and investors who supplied cash to fuel a housing boom that’s turned bust.
    A handful of state securities regulators and a couple foreclosure-blighted cities have fired the opening shots with lawsuits trying to prove that investment banks and big lenders are guilty of more than just bad business decisions and failing to foresee looming mortgage troubles. Some regulators say greed and fraud underlie much of the subprime mortgage mess that has spread across the broader housing market, triggering a spike in foreclosures.
    Aside from the civil cases, the FBI is looking at possible criminal action, focusing on what Wall Street firms knew about the risks of mortgage securities backed by subprime loans, and whether they hid risks from investors.
    Observers don’t expect the financial penalties that regulators extract in the civil cases to be massive. But the cases could turn up evidence that forces Wall Street to defend itself amid talk of government help to ease subprime-related financial strains on bond insurers. Revelations of bad behavior turned up by the government also could spur private investors to file even more lawsuits than the hundreds they’ve already brought to recover losses.
    “This could get a lot nastier, for many reasons,” said John Akula, a business law lecturer at the Massachusetts Institute of Technology’s Sloan School of Management. “Prolonged close scrutiny often turns up all kinds of dubious practices that in normal times are under the radar.
    “If the government sponsors any kind of bailout with public funds, this may be coupled with an aggressive prosecutorial agenda in support of efforts to get private parties to kick in.”
    Although the foreclosure-blighted cities of Cleveland and Baltimore have sued seeking to recover damages from mortgage lenders, most of the cases filed so far are from regulators alleging violations of state securities laws.
    Attorneys general in New York and Ohio are targeting alleged systematic inflation of home appraisals by major lenders and appraisal firms. Litigation in Massachusetts and other states seeks to demonstrate that investment banks failed to disclose risks to investors who bought mortgage-related securities and weren’t up front about conflicts of interest across their far-flung financial operations, including trading of subprime investments.
    “Over the years, the relationship between lender and borrower and a particular piece of property has been severed,” said Massachusetts Secretary of State William Galvin. “It’s clear that it’s become a runaway train.”
    Gone are the days when most borrowers simply got loans from the neighborhood bank, which used to hold the bulk of mortgage risk. Now that risk is spread further — mortgages are bundled together and sold to investors. Behind the scenes, credit-rating agencies offer advice on whether the investments are secure.
    Until recently, cash from Wall Street banks and investors extended growing amounts of credit to low- and middle-income Americans enticed to enter a market when home prices appeared headed nowhere but up.
    Lenders wrote $625 billion in subprime mortgages in 2005, nearly four times the total in 2001. The boom brought in big fees to mortgage brokers, lenders, banks and ratings agencies.

Just remember who was President when restrictions on banks and lending agencies were lifted so that every person could live the American Dream and own their own home. I'll give you a hint, he was a Dem. This was one of the main causes of the subprime disaster that we're facing today.

http://www.dailygazette.com

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Capital Region housing market plummets in January
Monday, February 25, 2008
By James Schlett (Contact)
Gazette Reporter

ALBANY — The slump that dogged the Capital Region’s housing market throughout last year has followed it into 2008, leading to a 20 percent drop in sales in January, according to statistics released today by the Greater Capital Association of Realtors.
The greater Capital Region ended last month with 490 closed single-family sales, down from 610 a year earlier. The downturn was most pronounced in Albany County, where sales plunged 36 percent to 112. January’s results marked the softest sales activity local Realtors have posted in more than five years.
The sobering sales statistics had association officials pointing to one of the local market's remaining bright spots: home values. The area’s median sale price inched up 1 percent to $191,750. But most of that increase came from a surprising price spurt in Saratoga County, which had seen home values decline or stay flat for most of 2007.
The county’s median sale price last month rose by 4 percent to $250,000. The median sale price dropped by 1 percent in Albany County and remained flat in Schenectady and Rensselaer counties.
January’s results indicate that last year’s sluggishness will persist well into 2008. Even GCAR Chief Executive Officer James Ader said “We don’t know when the housing market will start to become more active, nor do we have a crystal ball which will forecast housing values.”
Last year, area home sales fell 8 percent to 9,726 from 2006’s record high. The area’s median sale price for 2007 rose 2 percent to $192,500.
Single-family home sales took a similar dive in January on a national scale. U.S. home sales declined 22.4 percent to 4.34 million, compared to a year earlier. During the same period, the nation’s median sale price fell 5.1 percent to $198,700, according to statistics also released today by the National Association of Realtors, a Washington trade organization.

http://www.dailygazette.com

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‘Stagflation’ might be on its way back
BY JEANNINE AVERSA The Associated Press

    WASHINGTON — It’s a toxic economic mix the nation hasn’t seen in three decades: Prices are speeding upward at the fastest pace in a quarter century, even as the economy loses steam.
    Economists call the disease “stagflation,” and they’re worried it might be coming back.
    Already, paychecks aren’t stretching as far, and jobs are harder to find, threatening to set off a vicious cycle that could make things even worse.
    The economy nearly stalled in the fi nal three months of last year and probably is barely growing or even shrinking now. That’s the “stagnation” part of the ailment. Typically, that slowdown should slow inflation as well — the second part of the diagnosis — but prices are still marching higher.
    The latest worrisome news came Tuesday: a government report showing wholesale prices climbed 7.4 percent in the past year. That was the biggest annual leap since 1981.
    “We’re in a slowdown,” Press Secretary Dana Perino said at the White House, where the economics talk was still upbeat until recently.
    Once the twin evils of stagflation take hold, it can be hard to break the grip. People cut back on their spending as they are stung by rising prices and shriveling wages. Businesses, also socked by rising costs and declining demand from customers, clamp down on their hiring and capital investment.
    That would be a nightmare scenario for Wall Street investors, businesses, politicians and most everyone else. They’re already looking to the Federal Reserve for help, but the Fed’s job is complicated by the situation.
    The mission of Federal Reserve Chairman Ben Bernanke and his colleagues is to nurture economic growth and keep inflation under control. To brace the teetering economy, the Fed since September has been ratcheting down its key interest rate. Another cut is expected in March. However, to combat inflation, the Fed would be expected to boost rates instead.
    “The Fed has its hands full. It is preoccupied with the economic slowdown at the front door, but inflation looks to be sneaking in the back door,” said Greg McBride, senior financial analyst at Bankrate.com. “If that trend continues, the Fed would need to show the economy some tough love, meaning higher interest rates to keep inflation from getting out of hand.”
    On the other hand, Brian Bethune, economist at Global Insight, said Bernanke can fight only one war at a time, and the more pressing issue right now is to shore up the ailing economy. “That’s the war that needs to be fought. The war on inflation will have to come another day,” Bethune said.
    Maybe things won’t be so bad. Stock prices rose for the day, continuing a recent minirally. The Dow Jones industrials closed up 114.70 points. And Federal Reserve vice chairman Donald Kohn said in a speech that he doesn’t expect the recent elevated inflation readings to persist.
    “But the recent information on prices underlines the need to continue to monitor the inflation situation very carefully,” he added.
    Some numbers underscore the concerns:
    Prices paid by consumers were up 4.1 percent last year, the biggest increase in 17 years. Those higher prices — especially for heating homes and filling up gas tanks — are taking an ever-bigger bite out of paychecks. Workers’ weekly earnings are down 1.4 percent from January a year ago when adjusted for inflation.
    Oil prices galloped past $100 a barrel to close at a record $100.88 on Tuesday. Those lofty energy prices are a double-edged sword: They can spread inflation through the economy by boosting the prices of lots of other goods and services, and they can leave people with less money to spend on other things, thus slowing overall economic activity. There are signs high energy prices are causing some damage on both of those fronts.
    People are hunkering down. Earlier this month, nervous shoppers handed the nation’s retailers their worst January in almost four decades. High gas and food prices, the toll of the housing bust, the credit crunch and a tougher job market all were to blame. Disappointing sales were widespread, hitting discounters like Wal-Mart Stores Inc. and upscale merchants like Nordstrom Inc.
    Wary employers eliminated jobs in January, the first nationwide loss of jobs in more than four years.
    With the economy on the edge of a recession — if it hasn’t toppled over already — the Fed for the near term is much more likely to keep lowering rates. Yet, with its own forecast revised last week to show even slower growth this year as well as higher inflation and higher unemployment than previously anticipated, Bernanke and his colleagues have made clear they’ll need to stay nimble.
    Can a serious bout of stagflation be avoided? Many economists believe the Fed’s aggressive rate cuts along with tax rebates for people and tax breaks for businesses will lift the economy in the second half of the year.
    Until then, analysts warn that it could feel like the country is suffering through a mild case of stagflation— even if technically that is not the case. “It could feel like a bad flu,” said Bethune.
    In the past stagflation episode in the 1970s and early 1980s, inflation sometimes hit double digits — much higher than the current rate. And unemployment was higher, too. In 1975, for instance, the jobless rate zoomed to 8.5 percent, the highest since the early 1940s. Last year, by contrast, the jobless rate averaged 4.6 percent.
    “In the real economy, activity looks slow but not disastrous,” Alice Rivlin, former vice chair of the Federal Reserve, told Congress Tuesday. But she added: “Uncertainty remains great. The risks are mainly on the downside and gloomier forecasts are not hard to find.”


PAUL SAKUMA/THE ASSOCIATED PRESS
A grocery checker bags groceries for a shopper at J.J. & F. Market in Palo Alto, Calif., on Tuesday. Consumer confidence plunged in February as Americans worried about less-favorable business conditions and job prospects, a business-backed research group said Tuesday.

Each generation goes through a raping....the rip away and redistribute to the next....kind of like Robin Hood(only--NOT)...while at the same time there is skimming...to where? SHOW ME THE MONEY TRAIL!!....without gold/cash standard and the use of credit and plastic and microchips--who would ever know???

unjust scales make for a shaky foundation to this house of cards..... >

Mr.Spitzer
Mr.Bruno
Mr.Silver
Mr.Tedisco
Mr.Amedore
Mr.Suhrada
Ms.Clinto
Mr.Bush
Ms.Rice


and the rest of ya'll...the monkey is getting too fat!!!!

I say call all our savings and 401ks....take 'em back....before the Feds do their devouring.....someone needs to look behind the curtain for the 'GREAT OZ'....what a joke....