Stopping the Runaway Foreclosure Train The [mortgage modification] rules now being applied . . . have a Goldilocks quality. To get a modification a borrower has to need it a lot, but not too much. If the home is “underwater” ” worth less than the balance of the loan securing it ” but the borrower...Read More
Trickle-Down Economics, Wall Street-Style Floyd Norris, one of my favorite financial writers, ran a post earlier this week noting a recent London jewelry store burglary where the average bauble cost $1.5 million. That prompted this observation, “It will be hard for stores like this to stay in business if governments refuse to support bankers in...Read More
And Then There Were Two Goldman and Morgan were assisted in a rather violent industry consolidation. They remain, more than ever, officially “too big to fail” (TBTF), so they know they can always request tax funds directly from the Treasury Department and elevate risks above competitors. With their enormous profits they can buy out any...Read More
The Quick Way to Bank Profitability If the roots of today’s financial crisis were economic in nature, the vital signs to monitor would be such financial measures as the stock market, unemployment levels, and interest rates. However, a growing chorus of commentators believe that today’s dysfunctional financial system is ultimately a symptom of a political...Read More
Out of Treasuries, Into Stocks? “Obama Warns Trillion-Dollar Deficit Potential”—The New York Times (Jan. 7, 2009) “Suddenly, a Markets Turnaround”—The Wall Street Journal (Jan. 7, 2009) The stock market is famously forward-looking, so it’s certainly possible that the rally the last month or so — up 10% to 20% from its lows, depending on the...Read More
“Voting” your Home, or Your 401(k)?New York Times business columnist Floyd Norris has a provocative piece today titled “Housing Prices and McCain”: http://norris.blogs.nytimes.com/ Norris’ premise is that Obama defections are likeliest in “red” states where home prices have dropped the most. Could be, although you’d be hard-pressed to isolate just one factor in causing a...Read More
