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Bernanke signals possible rate cut
Econ Video —
The Export Slowdown
Calculated Risk —
This graph shows the combined loaded inbound and outbound traffic at the ports of Long Beach and Los Angeles in TEUs (TEUs: 20-foot equivalent units or 20-foot-long cargo container). Although containers tell us nothing about value, container traffic does give us an idea of the volume of goods being exported and imported. West Coast Port Traffic ...
Homeowners with Negative Equity
Calculated Risk —
From the WSJ: Housing Pain Gauge: Nearly 1 in 6 Owners 'Under Water' About 75.5 million U.S. households own the homes they live in. After a housing slump that has pushed values down 30% in some areas, roughly 12 million households, or 16%, owe more than their homes are worth, according to Moody's Economy.com. This is close to my estimate of homeowners with negative or no equity. These homeowners are at risk for default if they experience a negative event (like divorce or health problems) or they simply decide to mail in the keys. The number will probably rise to 20 million or more by the time house prices bottom.
UK: £50 Billion Recapitalisation, £200 Billion Special Liquidity Schemes
Calculated Risk —
Chancellor Alistair Darling statement : After consultation with the Bank of England and the Financial Services Authority, the Government announces that it is bringing forward specific and comprehensive measures to ensure the stability of the financial system and to protect ordinary savers, depositors, businesses and borrowers. In summary the proposals announced today are intended to: Provide sufficient liquidity in the short term; Make available new capital to UK banks and building societies to strengthen their resources permitting them to restructure their finances, while maintaining their support for the real economy; and Ensure that the ...
Fed Funds Rate Cut 50 bps, Global Rate Cuts
Calculated Risk —
From the Fed : Some easing of global monetary conditions is therefore warranted. Accordingly, the Bank of Canada, the Bank of England, the European Central Bank, the Federal Reserve, Sveriges Riksbank, and the Swiss National Bank are today announcing reductions in policy interest rates. The Bank of Japan expresses its strong support of these policy actions. ... The Federal Open Market Committee has decided to lower its target for the federal funds rate 50 basis points to 1-1/2 percent. The Committee took this action in light of evidence pointing to a weakening of economic activity and a reduction in inflationary pressures. Incoming economic data ...
Pending Home Sales Index Rises in August
Calculated Risk —
From the NAR: Pending Home Sales up Strongly The Pending Home Sales Index, a forward-looking indicator based on contracts signed in August, jumped 7.4 percent to 93.4 from an upwardly revised reading of 87.0 in July, and is 8.8 percent higher than August 2007 when it stood at 85.8. The index is at the highest level since June 2007 when it stood at 101.4. Existing home sales are reported at the close of escrow, pending home sales are reported when contracts are signed. The Pending Home Sales index leads existing home sales by about 45 days, so this suggests existing home sales in October will be up somewhat. This is data before the most recent credit ...
The Adjustment Process
Calculated Risk —
When I started this blog (Jan 2005), I was concerned about excessive speculation in housing and extremely loose lending practices. It appeared that housing starts and new home sales would fall significantly. I forecast record foreclosures and significant declines in home prices. Many of us wondered who the eventual bagholders would be for all the bad loans. I was also concerned about the extent of equity extraction from homes (the home ATM), and I believed that the coming housing bust would lead the economy into a recession. This blog was a daily dose of doom and gloom! Here was how former Fed Chairman Paul Volcker described ...
Paulson to Discuss G7 Crisis Coordination at 3 PM ET
Calculated Risk —
Blogroll: I'm going to try to limit the sites on the blogrolls below going forward. Here are the critieria for inclusion: 1) be an active housing or economics analysis site. Active means at least a few posts per week. There should be more analysis than selling of a product or service. And the sites should be oriented towards housing or economics (as opposed to say stock trading or other topics) 2) Provide a link to my blog on the front page. If you'd like to have your site added, please send me an email with "Blogroll" in the subject. Please specify the site title and URL, and the topic (housing or economics). Please be patient - I only add sites once a month ...
Fed Expands Loans to AIG
Calculated Risk —
From the Fed: Board authorizes Federal Reserve Bank of New York to borrow securities from certain regulated U.S. insurance subsidiaries of AIG The Federal Reserve Board has authorized the Federal Reserve Bank of New York to borrow securities from certain regulated U.S. insurance subsidiaries of the American International Group (AIG), under section 13(3) of the Federal Reserve Act. Under this program, the New York Fed will borrow up to $37.8 billion in investment-grade, fixed-income securities from AIG in return for cash collateral. These securities were previously lent by AIG’s insurance company subsidiaries to third parties. As expected, drawdowns to ...
