Posts filed under “Credit”

Loan Performance by State

In light of the recent fall in Home prices, as reported by the Case Shiller Index, why don’t we see what areas have under-performing loans? That might give us some insight into which areas of the country are suffering pricing problems.

LoanPerformance HPI puts together "comprehensive home price indices" and median sales
price datasets cover 7373 zip codes, 956 Core Based Statistical Areas
(CBSA), and 640 counties in all states and District of
Columbia—representing 30-plus years of repeat sales transactions and
more than 45 million observations.   

Here is their index in map format, which tracks changes in mortgage performances — the Redder states are getting worse (more delinquencies, defaults and foreclosures), while the green states are improving (less dd&f) over the prior 12 months.

 

Loan_101507_image_lg_ch

Now let’s compare that with the actual regional price changes:

Shiller_regions

Pretty interesting . . .

>

Sources:

Loan Performance via Felix Salomon Market Movers

Property Derivatives via TFS Derivatives Corp

Category: Credit, Real Estate

1980s Parallels?

Category: Credit, Federal Reserve, Markets

Can Housing Be “Rescued?”

Category: Credit, Data Analysis, Real Estate, Taxes and Policy

Markets Rally on Fed Rumors

Category: Credit, Economy, Federal Reserve, Inflation

Where was the Bubble: Houses, Rates or Credit?

Category: Credit, Derivatives, Federal Reserve, Fixed Income/Interest Rates, Real Estate

Mortgage Resets? Try Chapter 13 Bankruptcy!

Fascinating front page WSJ article today, titled More Debtors Use Bankruptcy To Keep Homes. It seems that Chapter 13 filings are gaining in popularity. Why? Because they halt foreclosure proceedings: “Last month, as the nation’s housing slump continued, consumer bankruptcy filings increased almost 23% from a year earlier – representing nearly 69,000 people — according…Read More

Category: Credit, Economy, Psychology, Real Estate, Taxes and Policy

Margin Debt Grows; Risk Grows Too

Category: Credit, Data Analysis, Investing, Markets, Trading

Open Thread: Resilient Markets, Accomodative Fed?

Category: Credit, Economy, Federal Reserve, Inflation, Markets, Psychology, Trading

Thin Trading: Fed Fund Futures and Antique Watches

Yesterday, Traders embraced the release of the FOMC minutes. Indices were flat up until just before the 2:00pm release, and then took off, with the Dow gaining near 1%.

The thinking behind the Fed action was clearly revealed in that release. The emphasis was on the subsequent impact of credit on the entire system. The WSJ reported:

"Federal Reserve officials worried that credit-market
turmoil could reinforce slower growth at a time of "particularly high
uncertainty," leading to their half-point interest-rate cut last month,
minutes from the meeting show.

Without a cut, there was concern that "tightening
credit conditions and an intensifying housing correction would lead to
significant broader weakness in output and employment," the
rate-setting Federal Open Market Committee said. The minutes, released
yesterday, also showed members worried that market turmoil "might
persist for some time or possibly worsen."

They offered no clues about
the direction or timing of the Fed’s next move."

That last sentence is quite intriguing. Understanding whether or not a rate cut is forthcoming impacts yields, stocks prices, etc.

Given the significance of the Fed’s action, one would suppose that the markets which trade the Fed Futures would be, if not prescient, than at least telling about their future price action. One of the more fascinating aspects about this, however, has been the way the Fed Fund Futures have functioned over this time. They have been wildly wrong, forecasting an imminent rate cut since January 2006. I thought it might be instructive to look at why this maybe so, and what it might mean . . .

Read More

Category: Credit, Derivatives, Economy, Federal Reserve, Inflation, Markets

A Robust Segment of the Housing Market

Category: Consumer Spending, Credit, Economy, Real Estate