From the WaPo: Barney Frank Talks Back A couple of excerpts: Klein: What's the most important part of financial regulation? Frank: Limiting securitization. I believe the single biggest issue here is that people invented ways to lend money without worrying if they got paid back or not by securitizing the loan. [...more]
Housing economist Thomas Lawler on CNBC this morning. "It is virtual certainty that [foreclosure] sales will pick up. Various moratoria has actually diminished the pace of sales, but as people try to see who can qualify for the modification program. [...more]
From the FDIC: Credit Quality Declines in Annual Shared National Credits Review Notes from the Fed: A SNC is any loan and/or formal loan commitment, and any asset such as other real estate, stocks, notes, bonds and debentures taken as debts previously contracted, extended to borrowers by a supervised institution, its subsidiaries and affiliates. Further, a SNC must have an original amount that aggregates $20 million or more and either 1) is shared by three or more unaffiliated supervised institutions under a formal lending agreement or 2) a portion is sold to two or more unaffiliated supervised institutions with the purchasing institutions assuming their pro rata share of the credit risk [...more]
"We could be facing a triple whammy at the end of the year: the expiration of the tax credit, the end of the Fed mortgage-buying program and rising foreclosures.” Thomas Lawler, housing economist From Bloomberg: Housing Suffering Relapse Confronts Bernanke Credit Conundrum (ht Mike in Long Island) A few excerpts: The Fed’s purchases of mortgage-backed debt so far this year have dwarfed net issues of such securities by Fannie Mae, Freddie Mac and government-run mortgage-bond insurer Ginnie Mae, which totaled about $440 billion through the end of August, said Walt Schmidt, a mortgage-bond strategist in Chicago at FTN Financial. Once the Fed exits the market, the spread between yields on mortgage-backed debt and Treasury securities will have to rise, perhaps by a half percentage point, in order to attract other buyers, he said. [...more]
Earlier today I posted a couple of bullish views and I disagreed with the projections of an "Immaculate Recovery". Former IMF chief economist Michael Mussa suggested that consumer spending wouldn't lead this recovery, but that business investment would be strong. [...more]
From a NY Times Editorial: Facts and the Financial Crisis The Financial Crisis Inquiry Commission, created by Congress to examine the causes of the crisis, held its first public meeting last week. .. [...more]
From James Grant in the WSJ: From Bear to Bull Knocked for a loop, we forget a truism. With regard to the recession that precedes the recovery, worse is subsequently better. The deeper the slump, the zippier the recovery [...more]
From the Chicago Sun Times: Capone lodge up for auction Al Capone's "hideout retreat" in Wisconsin [is up for auction] minimum bid required: $2.5 million. [...more]
This is an unofficial list of Problem Banks. [...more]
New fuel for fire Two Irwin Banks burn away Incandescent heat by Soylent Green is People From the FDIC : First Financial Bank, National Association, Hamilton, Ohio, Assumes All of the Deposits of Irwin Union Bank, F.S.B., Louisville, Kentucky, and Irwin Union Bank and Trust Company, Columbus, Indiana Federal and state regulators today closed Irwin Union Bank, F.S.B., Louisville, Kentucky, and Irwin Union Bank and Trust Company, Columbus, Indiana, respectively. The institutions are banking subsidiaries of Irwin Financial Corporation, Columbus, Indiana. [...more]
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