Mortgage Delinquencies Accelerating

The mortgage crisis is bad and getting worse. The latest evidence suggests that any bottom in real estate is some ways off in the future:

"Newly delinquent mortgage borrowers outnumbered people who caught up on their overdue payments by two to one last month, a sign that nationwide efforts to help homeowners avoid default may be failing.

In April, 73,880 homeowners with privately insured mortgages fell more than 60 days late on payments, compared with 39,584 who got back on track, a report today from the Washington-based Mortgage Insurance Companies of America said. Mortgage insurers pay lenders when homeowners default and foreclosures fail to cover costs.

Foreclosure filings surged 65 percent and bank seizures more than doubled in April compared with a year earlier as rates on adjustable mortgages increased, according to RealtyTrac Inc. Lawmakers and Federal Reserve officials are trying to ease the worst U.S. housing slump since the Great Depression through tax rebates, expanded federal mortgage insurance and other programs."

According to RealtyTrac, one in every 519 U.S. households is in some stage of the foreclosure process.

There is some good news amongst the dire foreclosure data: In April, a 183,000 homeowners were able to work out new borrowing terms with lenders and avoid foreclosure filings. Thats a record, according to the Hope Now Alliance.

However, that month’s 54% "cure ratio” among defaulted mortgages compares unfavorably with 80% a year earlier, and 87% in March 2008. This is mostly due to the accelerating foreclosure filings in April — more than 243,000 properties, a 65% YoY increase (RealtyTrac).

As long as defaults are occurring faster than workouts, the supply of foreclosure properties and REOs remain at uncomfortably high levels for some time to come . . .

Foreclosure By State, April 08

via Realty Trac


New Overdue Home Loans Swamp Effort to Fix Defaults
Josh P. Hamilton and Bob Ivry 
Bloomberg,  May 30 2008

Category: Credit, Data Analysis, Real Estate

Understanding Contrary Indicators

Category: Contrary Indicators, Economy, Markets, Psychology

Feldstein Says U.S. Economic Indicators ‘Pointing Down’

Martin Feldstein, an economics professor at Harvard University and president of the National Bureau of Economic Research, talks with about U.S. first-quarter gross domestic product, the outlook for Federal Reserve monetary policy and potential legislation to help homeowners avoid foreclosures.

click for video




Feldstein Says U.S. Economic Indicators `Pointing Down’
Bloomberg, May 29 2008

Category: Economy, Video

Friday Night Jazz: Chet Baker II

I was searching out some of my favorite Jazz artists on YouTube, when I randomly stumbled across this video of Chet Baker. For those of you unfamiliar with Baker, he was a terrific Trumpet player who was later "discovered" as a wistful blues singer, specializing in ballads and love songs.

Chet Baker’s vocal style is unmistakably unique — my favorite
description of his his voice is "at times, it seems like he’s
hanging onto the melody by his fingernails."
He seems at times half a tone off where you might expect him to be.

There is a lovely
melancholy, a gentle beauty, to the way he wraps his voice around a
song. The soft, simple sentiment embodied in his lyrical approach to ballads
can turn any song into a brooding lament.

There’s quite a few other videos at . . .


Either of these two CDs are good places to start exploring Baker’s works:

My Funny Valentine

"His vocals were absolutely distinctive, sung in a high-pitched, even
fragile voice seemingly drained of emotion and yet possessing an
inherent charm, a detachment that might be both the antithesis of style
and its definition, whether it’s heard as sensitivity or indifference.
The singing is a double of his trumpet playing here, spare and barely
present but achieving much through nuance and suggestion. Pianist Russ
Freeman is an almost constant partner, supplying deft chords and
harmonic daring, amplifying Baker’s ideas. Their empathy is especially
evident in the beautiful instrumental "Moon Love," but it’s just as
significant on signature Baker songs such as "My Funny Valentine,"
"Let’s Get Lost," and "Like Someone in Love." 
–Stuart Broomer


The Best of Chet Baker Sings

New videos after the jump

Read More

Category: Friday Night Jazz, Music

Technically, Not a Recession

Category: Economy

Bear vs Bull (1962)

Category: Contrary Indicators, Psychology

Revisiting Q1 GDP Revisions

Category: Data Analysis, Economy

April New Home Sales – Revisited

Category: Data Analysis, Real Estate

NYMEX Raises Margin Requirements for Crude

Category: Commodities, Energy, Trading

KB Homes: U.S. Home Prices Will Drop 10% More

Eli Broad, founder of homebuilder KB Home

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U.S. home prices likely will drop another 10 percent from their peak before the housing market begins to recover, said Eli Broad, founder of Los Angeles-based homebuilder KB Home. "Every housing market’s different, but you can expect housing prices to continue to decline in most markets for the next year or so,” Broad said in an interview from Los Angeles with Bloomberg Television.

Sales of previously owned homes in the U.S. fell 1 percent last month and the supply of unsold properties reached a record, the National Association of Realtors said last week, signaling a continuation of the 27-month housing slump. The median price of an existing home fell to $202,300 from $219,900 in April 2007. "I think we’ve got probably another 10 percent to go” from the price peak reached in 2006, Broad said today.

Broad said the U.S. economy is "in a recession no matter how you want to measure it,” and recommended that investors put their money in the energy industry, multinational companies with the largest stock-market capitalizations, and emerging economies such as Brazil, Russia, India and China. The return on U.S. stocks likely will "be in low single digits” this year, he said.

KB Home Founder Broad Says U.S. Home Prices Will Drop 10% More
Matt Miller and Daniel Taub
Bloomberg, May 28  2008

Category: Real Estate, Video