All Blog Posts from Econwatch
Read all 'housing' posts in Econwatch
November 23, 2009 8:12 AM
November 17, 2009 10:41 AM 
After seizing control of more than 150 failed banks in the last two years, the U.S. government reluctantly finds itself in the real estate business.
According to a Wall Street Journal report Tuesday, the Federal Deposit Insurance Corp. now owns more than 5,000 foreclosed properties taken from small banks that collapsed as the housing market went into the tank.
The entire catalog of properties, ranging from an $18,700 home in Birmingham, Ala., to a $1.7 million lodge tucked in the mountains of Steamboat Springs, Colo., carries an appraised value of $1.8 billion.
As the Journal's Michael M. Phillips writes: "The financial crisis started with Americans buying homes they couldn't afford. It is ending with the government struggling to sell buildings it never wanted."
Phillips charts the FDIC's efforts to sell troubled Dresden Heights – an unfinished housing development in Atlanta that counts an interstate highway and a pest control company as neighbors.
Among the many challenges facing the FDIC – a decaying constructions site, looters and the fact that potential buyers would technically have to trespass to get to their homes (the original developer took out loans from two different banks to buy the land and then build on it).
U.S. Left Holding the Bag after Housing Collapse
(AP / file)
According to a Wall Street Journal report Tuesday, the Federal Deposit Insurance Corp. now owns more than 5,000 foreclosed properties taken from small banks that collapsed as the housing market went into the tank.
The entire catalog of properties, ranging from an $18,700 home in Birmingham, Ala., to a $1.7 million lodge tucked in the mountains of Steamboat Springs, Colo., carries an appraised value of $1.8 billion.
As the Journal's Michael M. Phillips writes: "The financial crisis started with Americans buying homes they couldn't afford. It is ending with the government struggling to sell buildings it never wanted."
Phillips charts the FDIC's efforts to sell troubled Dresden Heights – an unfinished housing development in Atlanta that counts an interstate highway and a pest control company as neighbors.
Among the many challenges facing the FDIC – a decaying constructions site, looters and the fact that potential buyers would technically have to trespass to get to their homes (the original developer took out loans from two different banks to buy the land and then build on it).
November 5, 2009 4:04 PM 
Senate Banking Committee Chair Chris Dodd is planning to push a financial reform plan that would restructure the government's control of the banking industry, according to today's Wall Street Journal.
Dodd, the Democratic senator from Connecticut, has been praised by President Obama for his financial reform efforts, particularly for his work to establish a consumer protection agency.
His new plan, however, would significantly diverge from efforts by the Obama administration and the House Financial Services committee to overhaul the nation's financial regulation system.
The bill Dodd is proposing would almost completely restructure the federal financial regulation system, taking almost all bank-supervising responsibilities away from the Federal Reserve and the Federal Deposit Insurance Corporation (FDIC), the Journal reports. Bank-supervisory responsibilities would fall to a new agency that would oversee all national financial institutions: one single financial regulator. Currently, America has four federal regulatory agencies.
Senator Dodd Proposes Major Financial Reform
(CBS)
Dodd, the Democratic senator from Connecticut, has been praised by President Obama for his financial reform efforts, particularly for his work to establish a consumer protection agency.
His new plan, however, would significantly diverge from efforts by the Obama administration and the House Financial Services committee to overhaul the nation's financial regulation system.
The bill Dodd is proposing would almost completely restructure the federal financial regulation system, taking almost all bank-supervising responsibilities away from the Federal Reserve and the Federal Deposit Insurance Corporation (FDIC), the Journal reports. Bank-supervisory responsibilities would fall to a new agency that would oversee all national financial institutions: one single financial regulator. Currently, America has four federal regulatory agencies.
November 3, 2009 12:01 PM 
This post by Jill Schlesinger originally appeared on CBS' MoneyWatch.com.
After telling the world that assuming your personal financial conditions allow for it, the time is ripe for a home purchase, I started to actively look about a month ago. The process has been an excellent way to experience the highs and lows of the real estate market.
We found a smart and savvy agent, whose greatest asset was that she had entered the real estate market during a persistent period of weakness. She started our first outing by asking what we were looking for and then she said, "I'm going to spend the first half of the day showing you where the market is, so you can refine your search."
How NOT To Sell A House
This post by Jill Schlesinger originally appeared on CBS' MoneyWatch.com.
After telling the world that assuming your personal financial conditions allow for it, the time is ripe for a home purchase, I started to actively look about a month ago. The process has been an excellent way to experience the highs and lows of the real estate market.
(AP Photo/David Zalubowski)
We found a smart and savvy agent, whose greatest asset was that she had entered the real estate market during a persistent period of weakness. She started our first outing by asking what we were looking for and then she said, "I'm going to spend the first half of the day showing you where the market is, so you can refine your search."
October 30, 2009 1:08 PM
This post by Jill Schlesinger originally appeared on CBS' MoneyWatch.com.
I'm getting sick and tired of everyone talking about how much worse shape we would be in, but for (fill in the blank: TARP, stimulus, auto bail outs...) Even if it's true, it doesn't make anyone feel better. That's what I keep thinking when Obama Administration officials sound like cheerleaders claiming victory over job creation that occurred as a result of the $787 billion stimulus.
A White House report will be released later today and it's expected to show that the stimulus plan helped create or save 650,000 jobs through September 30th. One might want to take these numbers with a grain of salt, after digesting the AP report, which suggested that the folks who are providing the data to the White House can't seem to add or subtract too well. The AP analysis calls into question any of the official numbers, though the White House countered it by saying that the AP examination only represented 2% of Recovery Act spending. Kind of like how political polls only represent only a sliver of the population, from which we extrapolate larger trends, but that must different, right?
Consumers Aren't Buying Stimulus Jobs "Success"
This post by Jill Schlesinger originally appeared on CBS' MoneyWatch.com.
I'm getting sick and tired of everyone talking about how much worse shape we would be in, but for (fill in the blank: TARP, stimulus, auto bail outs...) Even if it's true, it doesn't make anyone feel better. That's what I keep thinking when Obama Administration officials sound like cheerleaders claiming victory over job creation that occurred as a result of the $787 billion stimulus.
(AP)
A White House report will be released later today and it's expected to show that the stimulus plan helped create or save 650,000 jobs through September 30th. One might want to take these numbers with a grain of salt, after digesting the AP report, which suggested that the folks who are providing the data to the White House can't seem to add or subtract too well. The AP analysis calls into question any of the official numbers, though the White House countered it by saying that the AP examination only represented 2% of Recovery Act spending. Kind of like how political polls only represent only a sliver of the population, from which we extrapolate larger trends, but that must different, right?
October 28, 2009 11:49 AM
This post by Jill Schlesinger originally appeared on CBS' MoneyWatch.com.
While the world continues to be distracted by the sideshow over executive compensation, there was finally a bit of good news from Washington yesterday. The House Financial Services Committee (in conjunction with the Treasury Department) finally released details of financial regulatory reform. Under the proposal, the Fed would become the primary systemic risk overseer, with input from a council of regulators. I like to think of this as the nation's superheroes - admittedly, a somewhat aspirational vision.
The proposed legislation gives the FDIC resolution authority - that is, the power to resolve financial holding companies that fail. Instead of the taxpayers being on the hook for the bill, the burden of bailouts would be on the financial industry itself. Firms with more than $10 billion of assets would pay for the rescue or unwinding of a collapsed competitor.
Don't Fear Fed Regs
This post by Jill Schlesinger originally appeared on CBS' MoneyWatch.com.
While the world continues to be distracted by the sideshow over executive compensation, there was finally a bit of good news from Washington yesterday. The House Financial Services Committee (in conjunction with the Treasury Department) finally released details of financial regulatory reform. Under the proposal, the Fed would become the primary systemic risk overseer, with input from a council of regulators. I like to think of this as the nation's superheroes - admittedly, a somewhat aspirational vision.
(AP)
September 21, 2009 8:10 AM 
Bank of America has until noon on Monday to comply with a demand for information from a panel of the U.S. House of Representatives about the bank's merger with Merrill Lynch near the end of 2008.
The House Committee on Oversight and Government Reform wants to know when BofA knew about Merrill's catastrophic losses that made it available for a merger, when the government committed a second dosage of public bailout money to the bank and what legal advice the bank received about disclosing information to shareholders, according to a report in Monday's New York Times.
BofA agreed to take over Merrill in September 2008 as investment bank Lehman Brothers was preparing to file for bankruptcy during the height of the financial crisis. It was later disclosed that Merrill paid executives $3.6 billion in last-minute bonuses before Bank of American took over in January with the knowledge of BofA executives.
BofA Risks Defying Gov't Demands on Merger
(AP)
The House Committee on Oversight and Government Reform wants to know when BofA knew about Merrill's catastrophic losses that made it available for a merger, when the government committed a second dosage of public bailout money to the bank and what legal advice the bank received about disclosing information to shareholders, according to a report in Monday's New York Times.
BofA agreed to take over Merrill in September 2008 as investment bank Lehman Brothers was preparing to file for bankruptcy during the height of the financial crisis. It was later disclosed that Merrill paid executives $3.6 billion in last-minute bonuses before Bank of American took over in January with the knowledge of BofA executives.
August 6, 2009 2:12 PM
Economist Diane Swonk: What's Next For The Markets?
By S.L. Mintz of CBS MoneyWatch.com.
Today’s cautious optimism sure beats the despair that gripped the stock market a few months ago, says chief economist Diane Swonk (at left) of Mesirow Financial. In her view, the markets reached a turning point in the second quarter, or one is imminent in the third quarter, driven more by the tapering off of bad news than the arrival of good news. But net job creation won’t revive before December or January, “if we’re lucky.”
Swonk has a front-row seat on the nation’s economy, sitting on several advisory committees to the Federal Reserve Board, its regional banks, and the Council of Economic Advisers for the White House. Most recently, she was reappointed to serve on the Congressional Budget Office’s panel of economic advisers, and Swonk is also past president of the National Association for Business Economics (NABE), a title that Federal Reserve Chairman Alan Greenspan and several other Federal Reserve presidents have also held.
Here she discusses whether she thinks the market’s recent rally is sustainable, which market sectors look good and which don’t, and what could derail a recovery.
The markets are now about 50 percent off their lows. What do you think is going on?
(MoneyWatch.com)
Swonk has a front-row seat on the nation’s economy, sitting on several advisory committees to the Federal Reserve Board, its regional banks, and the Council of Economic Advisers for the White House. Most recently, she was reappointed to serve on the Congressional Budget Office’s panel of economic advisers, and Swonk is also past president of the National Association for Business Economics (NABE), a title that Federal Reserve Chairman Alan Greenspan and several other Federal Reserve presidents have also held.
Here she discusses whether she thinks the market’s recent rally is sustainable, which market sectors look good and which don’t, and what could derail a recovery.
The markets are now about 50 percent off their lows. What do you think is going on?
August 4, 2009 9:01 PM 
In the last week, a slew of economic reports and news articles have suggested that the U.S. housing market has bottomed out.
Don't believe it. More pricey areas, often in large metro areas, still have plenty of room to fall.
You wouldn't know it from Tuesday's release of the National Association of Realtors' index, which showed that nationally pending home sales had increased from the levels of one month ago.
Also on Tuesday, homebuilder D.R. Horton reported smaller losses, a day after Pulte Homes Inc. and Centex Corp. said that orders for new homes had been increasing.
And there was plenty of excitement last week after the S&P Case Shiller index seemed to show a mild rise in month-over-month prices for existing single family homes.
Well, not so fast. In reality, the seasonally-adjusted version of the Case Shiller index – which came out later in the day, after the initial headlines had been written -- reveals a continued month-to-month decline from April to May. And the year-over-year decline remains around 17 percent.
The reason to expect further declines in some areas is that the U.S. housing market has now bifurcated. It's true that some areas with lofty rises (and subsequent severe falls) may have stabilized.
Not so some of the more expensive areas, especially those in metro areas with houses that are over $750,000, which also experienced skyrocketing prices (a two- or three-fold increase since 2000 wasn't unusual) but are taking much longer to revert to normal.
Why Home Prices Will Continue To Fall
(AP Photo/Ross D. Franklin)
Don't believe it. More pricey areas, often in large metro areas, still have plenty of room to fall.
You wouldn't know it from Tuesday's release of the National Association of Realtors' index, which showed that nationally pending home sales had increased from the levels of one month ago.
Also on Tuesday, homebuilder D.R. Horton reported smaller losses, a day after Pulte Homes Inc. and Centex Corp. said that orders for new homes had been increasing.
And there was plenty of excitement last week after the S&P Case Shiller index seemed to show a mild rise in month-over-month prices for existing single family homes.
Well, not so fast. In reality, the seasonally-adjusted version of the Case Shiller index – which came out later in the day, after the initial headlines had been written -- reveals a continued month-to-month decline from April to May. And the year-over-year decline remains around 17 percent.
The reason to expect further declines in some areas is that the U.S. housing market has now bifurcated. It's true that some areas with lofty rises (and subsequent severe falls) may have stabilized.
Not so some of the more expensive areas, especially those in metro areas with houses that are over $750,000, which also experienced skyrocketing prices (a two- or three-fold increase since 2000 wasn't unusual) but are taking much longer to revert to normal.
July 29, 2009 10:50 AM
Is Housing a Barometer for Economic Recovery?
Assuming that the recession ends, what does that mean for you? That’s what Harry Smith of the CBS News Early Show wanted to know this morning.
