The Junk Bond Time Bomb

By: Tuesday October 30, 2012 10:00 am

At some point, Wall Street will dry out, the New York Stock Exchange will return to life, and the traders will roll back into Lower Manhattan. And by most accounts, they will continue their trend of purchasing garbage. Junk bonds are living up to their name again. Companies with junk credit ratings have been increasingly [...]

Short-Term Economic Performance Does Not Equal Fixing Long-Term Structural Economic Problems

By: Wednesday October 24, 2012 1:26 pm

The Federal Reserve stood pat today, determining that they would continue with QE3 despite the relative improvement in economic performance. This clears one hurdle lingering in the minds of some observers: would the Fed have the resolve to stay the course, even if the economy strengthened, which would probably lead to an uptick in inflation? [...]

Banks Take Advantage of HARP Refinancing, Generate Huge Profits

By: Friday October 5, 2012 8:15 am

New data out this week shows that refinancing has taken off, though I’m not necessarily with Matt Zeitlin in saying that this shows HARP 2.0 to be working. Previous data has shown mortgage refinance applications rising and falling specifically with the changes in the interest rate, not HARP availability. And the data on faster prepayment [...]

US GDP Data Revised Down in Second Quarter

By: Thursday September 27, 2012 9:00 am

Economic growth for the second quarter of 2012 was revised down sharply to 1.3%, a reminder that economic activity really stalled out in the spring. Thursday’s report underscored that the recovery has proved insufficient to pull down the unemployment rate, which has been stuck between 8.1 percent and 8.3 percent all year. The renewed weakness [...]

Big Banks Increasing Spread on Mortgage Profits, Not Funneling Cheaper Rates to Customers

By: Wednesday September 19, 2012 8:25 am

Banks are making more off mortgages than ever before, refusing to pass on lowered interest rates from federal policy, including the purchase of trillions in mortgage-backed securities by the Federal Reserve, to consumers. This isn’t really the enigma that the New York Times’ Dealbook makes it out to be. It’s simple collusion. Nobody offers 2.8% mortgage rates, so nobody gets them. As a result, the spread that banks capture on their mortgages widens.

The Investor-Purchase Housing Bubble Inflates Some More

By: Monday September 17, 2012 10:27 am

Analysts have tried to parcel out whether QE3 will really help the economy. I’ve done the same thing myself. The way almost everyone looks at this is about the impact on housing, specifically mortgage prices. But mortgage rates haven’t changed at all since the announcement of QE3, and if the Fed was trying to influence [...]

Assessing the Impact of QE3

By: Friday September 14, 2012 11:00 am

Stocks have leveled off after yesterday’s boost from the Federal Reserve’s resumption of quantitative easing, this time in a more modest but open-ended capacity. Most analysts take for granted that this new QE3 will work, in fact, better than the first two rounds despite its smaller footprint. That stems from the use of the expectations [...]

Can We Trade Ben Bernanke for Mark Zuckerberg?

By: Tuesday July 17, 2012 7:15 am

Mark Zuckerberg, the kid who made himself a billionaire by combining the internet with the well known human traits of loneliness, voyeurism and exhibitionism has now wisely used his fabulous wealth to cut down on his mortgage payments.  He’s managed to cut the interest rate on his multimillion dollar home mortgage to just a few [...]

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