Northern Rock defaults leave taxpayers facing bill
No surprise here. There was only ever was one serious question; how much?
Trade-weighted sterling hits 12-yr low
The consequences of keeping interest rates low. A depreciated sterling today means more inflation tomorrow.
Bank of England May Cut Rates as U.K. Economy Slumps
Something which should turn recent sterling weakness into an uncontrollable rout.
The housing turnaround
Prices are still crashing, and estate agents are talking up a recovery.
What Global Rebalancing (aka The End of Foreign Funding Spree) Looks Like
The dollar will soon resume its journey downwards. It will take sterling along for the ride.
Not Only Homeowners Are Having Refinancing Problems.......
"U.S. and European banks, already burdened by losses and concerns about their financial health, face a new challenge: paying off hundreds of billions of dollars of debt coming due.
At issue are so-called floating-rate notes -- securities used heavily by banks in 2006 to borrow money. A big chunk of those notes, which typically mature in two years, will come due over the next year or so, at a time when banks are struggling to raise fresh funds. That's forcing banks to sell assets, compete heavily for deposits and issue expensive new debt."
I am not sure that this is such a big problem. When the time comes, everyone will have an incentive to roll these debts over.
Housing crash in Spain
It is ugly, fugly, and just plain nasty. When I look at Spain and Ireland, I sometimes wonder how much worse our housing bubble would have been if the UK had adopted the euro.
"U.S. and European banks, already burdened by losses and concerns about their financial health, face a new challenge: paying off hundreds of billions of dollars of debt coming due."
Lending Over Backward
Freddie and Fannie are not the only quasi-state financial institutions in America. There is also the FHA. ...
"Heralded as a savior in reversing the mortgage market’s woes, risks to the (FHA) agency could cost taxpayers dearly, says one mortgage expert, as Washington morphs the FHA from a helping hand for low-income home buyers into a back door bailout for the imploding mortgage industry. Trouble is, there's little choice at this point."
How to shore up America’s crumbling housing market?
This question could be better phrases. How to keep US house prices high when supply and demand are forcing them lower? Martin Feldstein thinks he has the answer; mortgage replacement loans. The scam is simple enough. Transfer around 20 percent of mortgage debt into loans from the government.
Can anyone answer this question; why does every scheme concocted to save the housing market have the government taking on a debt, offering a subsidy or reducing a tax? Why are there no private sector solutions to this problem?
Feldstein, who was previously a Republican, has a few other communist ideas to offer, such as reneging on contracts, and a "default on your debt, but keep your house" scam.
There is only one solution to this problem. Prices need to adjust to equate housing supply with housing demand.