Dow finishes down 140 points after S&P lowers outlook on U.S. debt.

This is just the beginning. It will get a lot worse if we can get rid of the fiat currency system that this country is enslaved to.

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Weekly Market Preview

Trade likely will be quiet with the religious holiday. Most all of the data points this week are centered on the housing sector; starts and permits for Mar, new and existing home sales, the NAHB housing market index Monday and the FHFA housing price index on Thursday. The only other releases are weekly claims on Thursday and the and the April Philadelphia Fed business index also on Friday. That's it for the week. Markets closed on Friday.
 
Until a week ago the overwhelming consensus in the markets was that the US economy would have a strong Q1 and optimism for the rest of the year was being touted as continued improvement. Over the past week investors were beginning to re-think the economic outlook and lowering expectations. It started with the IMF saying it is revising lower GDP Q1 growth from 2.0% to 1.5%; markets had accepted growth in Q1 at +3.0%. The Fed's Beige Book out last week, while remaining optimistic, showed indications that growth isn't as powerful as markets were thinking. The National Federation of Independent Business overall index fell in April, taking the optimism that had improved since last Oct totally away. Small businesses account for the majority of jobs. This is also earnings season with companies reporting Q1; so far earnings have been a little disappointing. 
 
Consumer spending declining, until recently, have been ignored by investors. Even with gasoline and food prices increasing markets generally didn't pay much attention----until last week. $4.00+ gasoline and rapidly increasing food prices will, as we have continued to mention, slow consumer spending. Bernanke out there saying the increase in energy and commodity prices are "transitory" may not be; markets beginning to understand that. With consumer spending less than expected and the housing markets still showing no signs of stabilizing, let alone improving, investors are getting a little nervous.  

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Loan Officer Compensation

The National Association of Independent Housing Professionals is throwing in the towel on its lawsuit against the Federal Reserve. However, NAIHP chief Marc Savitt promised that he's not done fighting the loan officer compensation rule. More to come on this for sure.

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Federal Reserve sanctions 10 banks for mortgage practices

The Federal Reserve said it's taken enforcement action against 10 banks over "a pattern of misconduct and negligence related to deficient practices in residential mortgage loan servicing and foreclosure processing. These deficiencies represent significant and pervasive compliance failures and unsafe and unsound practices at these institutions." The banks are
Bank of America (BAC), Citigroup (C), Ally Financial, the HSBC North America unit of HSBC Holdings (HBC) , J.P. Morgan Chase (JPM) , MetLife (MET) , PNC Financial Services (PNC) , SunTrust Banks (STI) , U.S. Bancorp (USB) and Wells Fargo (WFC) . In addition to the actions against the banking organizations, the Federal Reserve on Wednesday announced formal enforcement actions against Lender Processing Services, Inc. (LPS), a domestic provider of default-management services and other services related to foreclosures, and against MERSCORP, Inc., which provides services related to tracking and registering residential mortgage ownership and servicing, acts as mortgagee of record on behalf of lenders and servicers, and initiates foreclosure actions

From MarketWatch

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Closely Held Banks Still Waiting on SBLF Terms

There are 7,604 banks and thrifts in this country, and the core mission of nearly all of them is to lend locally. As currently structured, however, nearly 40% of these institutions are barred from taking part in the Small Business Lending Fund, the government's latest attempt to stimulate the national economy from the community level on up.

Cursed by its status as a subchapter S corporation, Riverside Bancshares Inc. is one of that sidelined minority.

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Japan upgrades nuclear-crisis assessment to level 7, on par with Chernobyl disaster
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Delinquency Rates & Foreclosures

BY THE NUMBERS - Lender Processing Services, Inc., a leading provider of integrated technology, data and analytics to the mortgage and real estate industries, reports the following "first look" at February 2011 month-end mortgage performance statistics derived from its loan-level database of nearly 40 million mortgage loans.

- Total U.S. loan delinquency rate (loans 30 or more days past due, but not in foreclosure): 8.80%

- Month-over-month change in delinquency rate: -1.2%

- Year-over-year change in delinquency rate: -18.4%

- Total U.S foreclosure pre-sale inventory rate: 4.15%

- Month-over-month change in foreclosure pre-sale inventory rate: -0.2%

- Year-over-year change in foreclosure pre-sale inventory rate: 7.4%

- Number of properties that are 30 or more days past due, but not in foreclosure: 4,659,000

- Number of properties that are 90 or more days delinquent, but not in foreclosure: 2,165,000

- Number of properties in foreclosure pre-sale inventory: 2,196,000

- Number of properties that are 30 or more days delinquent or in foreclosure: 6,856,000

- States with highest count of non-current loans: FL, NV, MS, NJ, GA

- States with the lowest count of non-current loans: MT, WY, AK, SD, ND
BLAME IT ON THE ARMs - Not so surprising, the report noted that "February's data also showed a 23 percent increase in Option ARM foreclosures over the last six months, far more than any other product type. In terms of absolute numbers, Option ARM foreclosures stand at 18.8 percent, a higher level than Subprime foreclosures ever reached."

The WSJ blames the housing dip is part caused by the disappearance of first-time homebuyers.

NAR reports that existing home sales dropped 9.6%, and the median price hit $156,100, a 10-year low. Taking this into account the WSJ says that the stage set for steep discounting in the spring market, according to the WSJ.

THE SILVER LINING - But good news can be found in the rental market, as it heats up. The average US apartment vacancy rates dropped to .5% last year from 8%. This has developers saliva ting over the potential for a multiyear rental boom, since the glut of foreclosed SFRs isn't proving much competition.

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Beware: Social Security numbers available online via indexed tax documents

As one who keeps up with the cutting edge of search engines and advanced search querying, it is with much reservation and disbelief that I bring you the results of my latest online investigative research. As of 4/10/2011, I have discovered in excess of 50 tax documents containing any given combination of Social Security numbers, credit card information, names, addresses, tax IDs, and phone numbers being made available online. However, unlike recent leaks of email addresses and password hashes being made available due to hackers compromising systems, these documents are being unknowingly made freely available to prying eyes by the very owners of said information.


Read more at http://www.zdnet.com/blog/seo/beware-social-security-numbers-available-online-via-indexed-tax-documents/2819?tag=nl.e539

The Department of Housing and Urban Development this week rescinded a controversial mortgagee letter that held homeowners or their heirs responsible for repaying, in full, a Home Equity Conversion Mortgage if they wished to keep the property.

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Weekly Market Preview

This Week not much in the way of economic reports. Interest rate markets will continue to take their lead from how the stock market performs each day. The bellwether 10  yr note, although likely to edge higher over the next few months, has twice found near term support when its yield climbs to 3.50% and in  turn is keeping mortgage interest rates from increasing. We continue our outlook that rates will increase but the level of increases won't be excessive; likely not over 4.00% for the 10 and another 40 basis points higher for mortgage rates for the rest of the year.
 
Tuesday the Fed will release the minutes from the FOMC meeting on March 15th; recently there has been an increase of the number of Fed officials that are wanting less easing and an end to QE 2. Global base lending rates are increasing and the Fed has to begin its moves to withdraw from easing. We do not expect the Fed will increase its base lending rate (FF) immediately, the first step will be ending QE 2, whether it ends prematurely is where the debate centers.
 
Two economic reports this week head up or focus; tomorrow the March ISM services sector index and on Thursday Feb consumer credit. Recent spikes in oil prices have likely caused consumers to cut back on other spending, the level of borrowing using credit cards should be watched. This week the ECB will meet with expectations that the bank will increase its base rate as inflation ion Europe has pushed up above the ECB target of 2.0%

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Facebook and Google Encroach on Banks' Turf

Facebook and Google are poised to go head to head with established financial services companies in online payments.

Both Internet companies have developed alternative payment networks that observers say could undermine the scale of dominant payments providers like MasterCard and Visa.

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Court Issues 11th-Hour Stay on Mortgage Loan Officer Pay Rule

An appellate court in Washington late Thursday night granted a stay delaying implementation of the Federal Reserve's loan officer compensation rule until April 5.

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Profit Opportunity: The Baby Boomers' Last Spending Spree

Don't even try to guess what the next big winner will be in the health care sector. Nobody knows which pharmaceutical company will come up with a blockbuster drug. Or which insurance company will benefit most from the new health care bill.

But you can make big profits by betting on just one thing: that the demand for health care will continue to increase. With the investment I mentioned yesterday, I believe you can make 10%+ gains and grab a 5%+ dividend every year for the foreseeable future.

As I said, the baby boomers are going to swamp the health care industry for the next 20 years.

So it makes sense to ride the coattails of this mega-trend.

And one of the easiest ways to do it is by investing in a health care REIT (real estate investment trust). Health care REITs own properties like senior housing, hospitals, skilled nursing facilities, and medical office buildings. And, like all REITs, they must pay out 90% of their taxable income in the form of dividends.

Why do I like REITs so much?

The main reason is that, because they own the health care facilities, they get paid no matter who the patient uses for insurance, what company manufactures their medication, etc.

And most of their properties are leased to health care providers for long periods of time, usually 10 to 15 years. So health care REITs aren't as worried about economic swings as, say, shopping mall REITs would be. If the economy drops, their retail tenants may go out of business. But because health care is virtually recession-proof, and their leases tend to be long-term, the health care REITs have a much more stable revenue stream.

The increasing demand for health care over the next 20 years means there will be an increasing need for more locations to deliver health care services. And with only 10% of health care real estate already owned by REITs, there's much more room for these REITs to grow.

But as an investor, you don't just get a great growth story. Because REITs have to pay out 90% of their income as dividends, you get a nice dividend check every quarter. And the yield on health care REITs (most average over 5%) is higher than that of most other investments.

Growth and income. The best of both worlds.

By Christian Hill

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Fed Won't Budge on Disputed Rule on LO Comp

The Federal Reserve Board is showing no signs of backing down on its loan officer compensation rule despite congressional requests and industry lawsuits to delay the April 1 effective date.

Here's my question, why does the Fed have anything at all to say about anything?

They are not a government agency, they are not even suppose to be in control of our monetary system! I don't have the space to explain here, but if you want to understand how our entire monetary system and economy has been hijacked, read "The Creature from Jekyll Island". This is one book that does a great job of explaining the fraud that has occurred since 1913.

I am just disgusted with the whole thing.

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Now And Then

NOW

Just when we thought that the housing industry was gaining strength it has taken another gut punch.
February is sizing up to be one of the weakest months ever for housing. First, starts, permits and existing home sales nose-dive. Then, last Wednesday new home sales followed with a staggering 16.9% plunge, to their lowest level since records began in 1963.

Housing has become massive headache for Washington. After months of attempting to micromanaging the industry with subsidies for Fannie, Freddie and buyers' tax credits and tweaking with underwriting, availability of money, the foreclosure process and the property appraisal process, they find the industry in a real quagmire.
The whole mess began with social engineering and messing with free market forces. When that grand experiment turned into an economic disaster of epic proportions, they are further manipulated the free market through central planning.

It's no wonder policymakers are stymied. It's no wonder builders, consumers and housing industry professionals are losing confidence, especially in Washington.

THEN - EARLY WARNINGS

This week's Wall Street Journal brought to light a 2006 internal report by Fannie Mae that warned of abuses in the way lenders and law firms were handling foreclosures. That is many months before regulators showed any concern.
The report cited routine abuses to the foreclosure processes, saying that attorneys in Florida had "routinely made" false statements in court to rush the process.

Fannie Mae's recent response: "Fannie Mae took the necessary steps to address the specific issues identified by the 2006 report and regularly evaluates and enhances oversight of its retained attorney network."

This is just one example of the mismanagement in Fannie and Freddie that led to a full government takeover in 2008, when losses resulted in taxpayers coughing up over $134 billion.

While the report did not address "robo-signing," it did question improper legal filings and the Mortgage Electronic Registration System that was intended to streamline the whole foreclosure process.

One perspective: It seems everyone in Washington is taking turns stirring the pot. It will likely take more than an act of Congress to straighten out the Housing Industry. Perhaps it is best let the market settle to its own levels of supply and demand. It will take time, but it will eventually right its self.

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Economic Calendar

Economic Calendar This week will be busy from start to finish... but the biggest news will hit on Friday! Right away Monday morning we’ll see the Personal Consumption Expenditures (PCE) Index, which is the Fed's favorite gauge of inflation. And as stated above, inflation is the archenemy of Bonds - which means it’s also bad for home loan rates. We’ll also see a new report Monday morning on Pending Home Sales, which comes after last week’s disappointing reports on Existing Home Sales and New Home Sales. This week, we’ll gain new insight on consumers - with the Personal Spending and Personal Income reports on Monday as well as the Consumer Confidence report on Tuesday. Manufacturing will also be in the news with Thursday’s release of the Chicago PMI, which reports on manufacturing in Chicago and is a good indicator of overall economic activity. But the big news to watch this week relates to employment, which kicks off Wednesday with the ADP National Employment Report on non-farm private employment. Next up is another round of Initial Jobless Claims on Thursday. Last week’s report indicated that Jobless Claims are improving on a weekly basis, but at a snail's pace and not enough to make a meaningful dent in our stubbornly high unemployment rate. Finally, the busy week culminates with the highly anticipated Jobs Report on Friday. This report features new data regarding job growth and the unemployment rate - needless to say, this report can be a big market mover! Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

Weekly Market Preview

This week unlike last week there are events and data points everyday for the bond and mortgage markets to consider. This is employment week with the March employment data on Friday, early expectations are for non-farm jobs to increase 185K with non-farm private jobs up 203K, the unemployment rate is expected unchanged at 8.9%. In the meantime Feb personal income and spending out on Monday, Mar consumer confidence on Tuesday, Thursday has weekly jobless claims, the Chicago purchasing mgrs index, Friday the ISM national manufacturing index.
 
Recent better than expected earnings reports and relaxing of concerns from Japan has boosted equity markets and interest rate markets are taking on a more negative technical pattern. We remain bearish for the outlook on rates, however we are not looking for rates to move substantially higher. The prime and only reason the bond and mortgage markets rallied recently was over safety moves on the Japanese nuclear problems.
 
Not only economic data this week, but Treasury borrowing. Tuesday $35B of 2 yr notes, Wednesday $35B of 5 yr notes and Thursday $29B of 7 yr notes. Recent auctions still seeing OK demand but not quite as strong as auctions last year. Debt problems in Europe (Portugal, Spain, Greece and Ireland get coverage in the media but are not having any noticeable impact on US bond markets.

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The Obama Deception HQ Full length version

Economic Highlights

MONDAY, March 21st

Existing home sales fell 9.6% in February to an annual pace of 4.88 million compared to market expectations for a smaller decline and a rate of 5.10 million. All cash transactions accounted for a record 33% of sales, distressed sales accounted for 39% while investors accounted for 19% of total sales. Existing home sales are now 2.8% below their year ago level and off 32.7% from their September 2005 record high. Inventories increased 3.5% to 3.488 million which represents an 8.6 month-supply. Prices continued to retreat given the bulk of distressed properties working through the market. The median price for an existing home fell 5.2% over the past year to $156,100. Several months of moderate gains were once again followed by a sharp decline in home sales. Details in the data series show weakness in most areas of housing as well, from pricing to inventories to sales. Nevertheless, the h housing market is expected to improve from here amid high affordability and as the economy begins creating more jobs.
TUESDAY, March 22nd

The Federal Housing Finance Agency (FHFA) purchase-only house price index declined 0.3% in January from December and is now down 3.9% from January one year ago. The index includes conforming loans only. Pricing in this portion of the housing market has been on a downward trend for the last couple of years, basically for the duration of the downturn. Broader pricing trends like those measured by the S&P/Case Shiller index also show lower house prices, but just in the last six months. Given the large inventory of foreclosed homes and weakness in housing demand home prices will continue to come under pressure this year.

WEDNESDAY, March 23rd

The MBA mortgage applications index rose 2.7% to 524.4% for the week ending March 18. Both the purchase index and the refinance index rose by the same amount last week. Despite the increase, total mortgage activity is still 11.9% below its year ago level. Demand for home financing remains weak and will turnaround on stronger job and income growth, improved credit flows and once home prices stabilize.
New home sales plummeted 16.9% in February to an all time record low annual rate of 250k. This was the slowest pace of new home sales since this data series began in 1963. Moreover, it follows a sharp decline of 9.6% in January. The regional data showing enormous declines in the Northwest and Midwest suggest that severe winter weather may have played a role in the tremendous weakness last month. New home sales are now 28.0% below their year ago level and off a stunning 82.0% from their July 2005 peak. Inventories were unchanged at a 44-year low of 186k which reflects an 8.9 month-supply at the current sales pace. These data weaken the outlook for new home sales this year. The new home market remains mired at the bottom and it will take a significant turnaround in the economy, jobs and credit to get unstuck. Cheaper, distressed properties will also need to be worked through the market before fundamental support for new home sales returns.

THURSDAY, March 24th

Jobless claims fell 5k to 382k for the week ending March 19. The average level of initial claims has been below 400k in the last six weeks or so indicating slow, continuous improvement in the labor market. Job losses have slowed but job creation has yet to begin in earnest.

FRIDAY, March 25th

Fourth quarter GDP was upwardly revised to a 3.1% annual rate in its third and final estimate compared to a 2.8% rate of growth in the preliminary estimate and a 2.6% rate in Q3. Capital spending, home building and inventory investment were stronger than estimated while consumer spending, net exports and government purchases were weaker. The GDP price index was up just 1.3% from its year ago level as soft economic conditions make it difficult for companies to raise prices. Data released so far this year suggest that Q1 GDP grew at about the same pace as Q4 with estimates ranging from 2.5% to 3.5%.

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Who Knew What When?

The Journal said Fannie Mae was warned in a 2006 internal report of abuses in the way lenders and their law firms handled foreclosures, long before regulators launched investigations into the mortgage industry's practices. The report said foreclosure attorneys in Florida had "routinely made" false statements in court in an effort to more quickly process foreclosures and raised questions about whether some mortgage servicers or another entity had the legal standing to foreclose. Fannie Mae executives weren't the only ones who should have seen the housing crisis coming.

In the Times' "High and Low Finance" column, Floyd Norris wrote that former WaMu chief Kerry K. Killinger was talking about the "high risk" in the housing market in internal documents ? and finding signs of fraud in loans ? as early as 2005. But Norris said Killinger "was also convinced that Wall Street would reward the bank for taking on more risk" and it kept on doing so.

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