Headlines...

NEW -> Contingent Buyer Assistance Program
I got this from Barry over at the Big Picture, I haven't checked if Keith over at HP has it, but I would be surprised if he didn't. <a href="http://www.parkerchris.pwp.blueyonder.co.uk/vocationvocationvocation.html">So here is the Brit's version of the housing price crash</a>.
 
<p class="times"><strong><a href="http://online.wsj.com/article/SB120423483765800801.html?mod=todays_us_nonsub_page_one">Dollar's Dive Deepens as Oil Soars</a></strong></p>

<p class="times">"Beaten down by fears of a U.S. recession, the dollar is falling with new speed -- creating severe challenges not just for the U.S., but also for sugar traders in Brazil, central bankers in the Persian Gulf and a host of others.</p>

<p class="times">On Thursday, the dollar sank to a new record low against the euro, deepening a six-year slide in which it has fallen more than 40% versus the European currency and more than 20% against a broader basket of currencies. In late trading in New York, one euro fetched about $1.52, just two days after it surged through the symbolically important level of $1.50." </p>

<p class="times"> BTW, This article contains some hawt chart pr0n!</p>
 
<p>It wasn't just the dollar. The Yen dropped to 103.88.</p>

<p>In more fun news, CNNMoney has the Dow Futures at -271 in after hours trading. Monday could be really bad.</p>
 
<p><strong>US negative equity</strong></p>

<p>"Underwater loans are giving banks that sinking feeling. It turns out that second mortgages taken out when the US property market was booming are particularly painful for lenders when prices fall so fast that the house is worth less than the outstanding loan.</p>

<p>JPMorgan Chase has just provided a blunt assessment of its $95bn portfolio of second mortgages, also known as home equity loans. The extra disclosure revealed that about 10 per cent of it is secured against homes suffering the burden of negative equity. Loans caught in this trap are particularly toxic for the banks. They punch above their weight in contributing to credit losses – 60 per cent in JPMorgan Chase’s case – with loss rates three to four times those incurred on loans that are still just – but only just – in the money..." from <em>FT 2/29/08</em></p>
 
WAMU = Owned.





I don't believe they have enough loan loss reserves to cover the SECOND liens let alone their 1st trust deeds. WAMU doesn't have anywhere nearly the capital that JPM does.
 
Aren't we witnessing historic times, huh?





The week that just ended was historic, kind of perfect-stormy historic, because many things aligned in a bad way: oil $100+, EUR vs USD 1 = 1.50+, inflation awaiting for you in your next grocery shopping and, last but not least, house prices declining.





The credit/housing bubble was unprecedented on the way up, for sure is unprecedented on the way down.
 
<p>An activist group found Mozillo's home number and eventually got a meeting with Countrywide execs...</p>

<p><a href="http://biz.yahoo.com/ap/080301/the_shark_hunters.html">http://biz.yahoo.com/ap/080301/the_shark_hunters.html</a></p>

<p>SCHB</p>
 
<p>Shark Hunters? Won't that be a colossal waste of time? Where were the protesters during the meteoric rise of the housing bubble? Oh wait, they were probably drinking the kool-aid... How convenient.</p>

<p>Shadenfreude much? Yeah, I'm still full of it because now the rules have changed and I'm scrambling to maintain my net worth. </p>

<p> </p>

<p>Edit: Whew! Okay, feel a little better now. Back to the grind! </p>
 
<p><strong>Don't miss Shiller in the <em>NYT</em>:</strong></p>

<p><strong><a href="http://www.nytimes.com/2008/03/02/business/02view.html?_r=1&oref=slogin">How a Bubble Stayed Under the Radar</a></strong></p>

<p>"ONE great puzzle about the recent housing bubble is why even most experts didn’t recognize the bubble as it was forming..."</p>

<p><a href="http://www.nytimes.com/2008/03/02/business/02view.html"><img height="75" alt="How a Bubble Stayed Under the Radar" width="75" border="0" src="http://graphics8.nytimes.com/images/2008/03/02/business/02viewe.751.jpg" /></a></p>
 
I have added the paper, that Shiller cites, to the new members thread.





<img src="http://graphics8.nytimes.com/images/2008/03/02/business/02view.xlarge1.jpg" alt="" />
 
<p><strong>Gretchen has discovered the recession...</strong></p>

<p>"BEN S. BERNANKE, the Federal Reserve chairman, told Congress last week that fighting off a possible recession in the United States was Job 1 for his crew. But a consumer-led recession has already begun, according to a new index that reflects how much money Americans can actually spend right now. </p>

<p>The new indicator comes courtesy of Charles Biderman, the founder and chief executive of TrimTabs Investment Research, a proprietary research firm in Santa Rosa, Calif. “The big picture is: the amount of money people have to spend, which includes money on real estate transactions, is plummeting, and it started to break down in October,” he said.</p>

<p><a href="http://www.nytimes.com/2008/03/02/business/02gret.html?_r=1&ref=business&oref=slogin">MORE...</a></p>

<p>And <strong>Daniel Gross</strong> over at <em>Slate</em> has an interesting take on, <a href="http://www.slate.com/id/2185372/">"Why nobody in Washington wants to say <em>recession</em>."</a></p>
 
<p><a href="http://biz.yahoo.com/cnnm/080226/022608_financial_illiteracy.html?.v=6&.pf=banking-budgeting"><strong>Americans are 'financially illiterate' - survey</strong></a></p>

<p>


"Americans don't understand debt, which may be one reason that they have too much of it, according to a survey released Tuesday. </p>

<p>The survey presented 1,000 people with a hypothetical scenario about credit card debt and asked them to compute how long it would take to pay it off. Only 35.9% of the 1,000 respondents could figure out how many years it would take for the amount they owe on their credit cards to double. A full 18.2% did not know how to respond and 31.9% of those surveyed over-estimated the timeframe..."</p>
 
<p>Yen is @ 102.93. Dow futures are no longer at -271, rising to only -81. European exchanges look to open down at least 1%.</p>

<p>I don't know if we will ever see a crash like 1929, but I am expecting it. Today looks like a bad day, but so have others since July.</p>

<p>And there there is this:</p>

<p><a href="http://www.marketwatch.com/news/story/california-munis-show-new-trend/story.aspx?guid=%7B80F01004%2DB439%2D45BC%2D86BE%2DF4BEBF7B9779%7D">California skips bond insurance</a></p>

<p><em>Since the start of this year, 39% of issued long-term municipal debt has carried credit insurance compared with 65% during the first two months of 2007. Total issuance has plunged 50% this year, according to data provided by the Securities Industry and Financial Markets Association and Thomson Financial. "There's no economic advantage for issuers to use bond insurance, by and large," said Dick O'Brien, the Hunt Valley, Maryland-based head of fixed income at New York brokerage Folger Nolan Fleming Douglas Inc.</em> </p>

<p>Bond insurers like MBIA and Ambac haven't been raking in the business lately, which makes it hard for them to retain the funds needed to retain their AAA ratings. The ratings agencies have been more than willing to turn a blind eye to prevent a cascading collapse in the bond markets, but eventually they will have to recognize that no one is believing that the insurers are worth what they say they are. At that point, the ratings agencies will have to do something to retain what little credibility they have left. If other muni bond issues skip the insurance like California seems to have done, that action may prove to be the straw that broke the camel's back.</p>
 
<p><a href="http://news.yahoo.com/s/ap/20080303/ap_on_bi_ge/oil_prices">Oil jumps to new record on dollar's fall</a></p>

<p>NEW YORK - The surging price of oil reached another milestone Monday, jumping to an inflation adjusted record high of $103.95. </p>

<p>The weaker dollar that has propelled oil and other commodities prices higher sent light, sweet crude for April delivery past $103.76 a barrel on the New York Mercantile Exchange. That's the level many analysts consider to be the true record high for oil, after its $38 barrel price from 1980 is translated into 2008 dollars.</p>

<p>The price later traded up $1.52 at $103.36, fluctuating with the normal ebb and flow of trading.</p>

<p> </p>
 
<p>Gold reached 990, then went down a bit. Haven't checked for a while. Silver over 20</p>

<p>As another blogster said some time ago, "Go free market, go!"</p>
 
<a href="http://www.cnn.com/2008/CRIME/03/03/seattle.fire/index.html">www.cnn.com/2008/CRIME/03/03/seattle.fire/index.html</a>





<em>Fire engulfed five luxury homes Monday morning at a subdivision north of Seattle in what could be a case of ecoterrorism, officials said.





"Built green? Nope black!" the sign reads, according to an image from CNN affiliate KING-TV in Seattle. The sign calls the homes "<strong>McMansions</strong>."</em>
 
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