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Subprime Collapse

Started by D Lim; Last updated Feb 29, 08 6:23 AM CST by Imperator | View history

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Subprime Collapse

From the housing market to hedge funds, as the subprime market goes belly up, America's thirst for cheap cash is coming back to haunt speculators

Stories

Stories 321 - 340 of 529

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December 2007
- Banks Scuttle SIV Bailout
  
  Wall Street Journal | Dec 21, 07 3:56 PM CST
  
  (Newser) - The three banks charged by Treasury with setting up a fund to bail out investments threatened by the subprime mess are abandoning the project, the Wall Street Journal reports. Citigroup, Bank of America and JP Morgan Chase had been working since September on the plan to rescue structured investment vehicles, but they have struggled to raise money for the project. More »
- Merrill Lynch Seeking $5B Cash From Singapore
  
  Wall Street Journal | Dec 21, 07 7:49 AM CST
  
  (Newser) - Facing a fourth-quarter writedown of an estimated $8 billion in subprime paper, Merrill Lynch is negotiating with Singapore’s state-owned investment fund Temasek Holdings for a $5-billion cash infusion, the Wall Street Journal reports. If the deal goes through, Merrill would join several other Western financial institutions bailed out by Asian or Mideastern governments since November. More »
- Morgan Stanley CEO Feels Heat
  
  Wall Street Journal | Dec 20, 07 11:37 AM CST
  
  (Newser) - When John Mack became Morgan Stanley’s CEO in 2005, he told the company to take more risks. “You’ve lost your swagger,” he told his traders. Now, after several questionable moves and yesterday's staggering $9.4 billion writedown, swagger isn’t looking so hot—and Mack could be sent packing, the Wall Street Journal reports. More »
- Bear Stearns Posts First Loss
  
  Bloomberg | Dec 20, 07 9:19 AM CST
  
  (Newser) - Analysts expected Bear Stearns to post its first-ever loss today, they just expected it to be smaller. After $1.9 billion in subprime writedowns, the company posted a $6.91 loss per share, dwarfing the $1.82 analysts predicted. Executives gave up their bonuses, as revenue from debt sales and trading were wiped out, Bloomberg reports. “They’ve got a myriad of problems,” one analyst said. More »
- Feds Investigate Bear Stearns Fund Manager
  
  Bloomberg | Dec 19, 07 12:00 PM CST
  
  (Newser) - The manager of hedge funds that lost $1.6 billion when they went bankrupt in July has left Bear Stearns, and federal investigators are looking into whether he withdrew his own money before the collapse. Ralph Cioffi moved $2 million in March—before the funds tanked in the subprime collapse—to another Bear offering, Bloomberg reports; the feds are investigating. More »
- Morgan Stanley Stuns With $9.4B in Writedowns
  
  Wall Street Journal | Dec 19, 07 8:10 AM CST
  
  (Newser) - Morgan Stanley, the nation's second-largest investment bank, lost $3.59 billion this quarter, its first loss ever, after taking a whopping $9.4 billion in writedowns on mortgage-backed securities. CEO John Mack, who promised to give up his 2007 bonus as penance for the losses, also announced a $5-billion cash infusion from China Investment Corp., the investment arm of the Chinese government, for a stake of 9.9% of the company. More »
- No Bonus for Bear Stearns Execs
  
  Wall Street Journal | Dec 19, 07 7:41 AM CST
  
  (Newser) - Bear Stearns’ CEO and other top executives, poised to announce the company’s first quarterly loss in its 84-year history tomorrow, are expected to bypass millions of dollars in annual bonuses, an acknowledgment of the dismal year the firm had, driven down by the collapse of the subprime mortgage market and two internal hedge funds, the Wall Street Journal reports. More »
- Fed Cracks Down on Loose Lending
  
  Wall Street Journal | Dec 18, 07 7:43 PM CST
  
  (Newser) - Seeking to avoid another subprime meltown, the Federal Reserve cracked down on mortgage lending today by a unanimous 5-0 vote, the Wall Street Journal reports. If approved next year, the Fed proposals will require creditors to consider borrowers' financial and credit status, but will not prohibit prepayment penalties altogether, a move sought by some consumer groups. More »
- Brits Hatch Secret Plan to Bail Out Northern Rock
  
  Guardian (UK) | Dec 18, 07 2:05 PM CST
  
  (Newser) - Worried that the state might be stuck nationalizing Northern Rock, Britain has worked up a contingency plan behind closed doors to divide the troubled bank among the country’s commercial banks. A private buyout is still preferable, the Guardian reports, but some now fear the main bidders will back out, leaving the government holding the bag. More »
- Credit, Economy Bring M&A Action to a Crawl
  
  Bloomberg | Dec 18, 07 11:40 AM CST
  
  (Newser) - The slowing economy and financing costs that have more than doubled since June because of the subprime collapse could ice the pace of mergers and acquisitions in 2008, Bloomberg reports. After a record $3.9 trillion in deals in 2007, analysts predict transaction value could plummet 20%. "The mega-LBO is dead,'' says an ABN Amro takeover expert. More »
- Nov. Housing Starts Fall 3.7%
  
  Bloomberg | Dec 18, 07 10:30 AM CST
  
  (Newser) - Housing starts fell less than expected in November, but fall they did, extending the worst housing slump since 1991. Starts fell 3.7% and, according to one analyst, probably won’t turn around until the third quarter of next year. Permits issued, which give a picture of future construction, fell to a 14-year low, Bloomberg reports. More »
- Fed Plans to Tighten Mortgage Lending Rules
  
  Associated Press | Dec 18, 07 8:49 AM CST
  
  (Newser) - Stricter rules will face mortgage lenders if a Federal Reserve proposal unveiled today moves forward. The Fed wants to prohibit or limit prepayment penalties, force lenders to make sure borrowers set aside money for taxes and insurance, require lenders to verify income, and prohibit lenders from giving borrowers unaffordable loans, the AP reports. More »
- Senate Votes to Aid At-Risk Homeowners
  
  Associated Press | Dec 14, 07 4:44 PM CST
  
  (Newser) - In an attempt to quell the ongoing housing crisis, the Senate approved a bill today that would allow the Federal Housing Administration to back refinanced loans for the thousands in danger of defaulting on mortgages. The bill, which passed 93-1, also repositions the FHA as an attractive alternative to subprime lenders by lowering minimum down payments and offering homeowner counseling. More »
- Greenspan: Odds Rising for Recession
  
  NPR | Dec 14, 07 9:03 AM CST
  
  (Newser) - Alan Greenspan warned yesterday that sluggish economic growth is increasing the risk of recession. "It's too soon to say, but the odds are clearly rising," the former Fed chief told NPR. The subprime crisis and its resulting credit turmoil has growth "getting close to stall speed," he said. More »
- Northern Rock Boss Quits as Fall Continues
  
  Financial Times (UK) | Dec 13, 07 7:54 AM CST
  
  (Newser) - The CEO of collapsing British bank Northern Rock quit this morning without comment, reports the Financial Times . Adam Applegarth resigned last month but had pledged to stay on as CEO until the end of January to guide the struggling company through its upcoming sale. But investors are troubled by the slow speed of the transaction, with Applegarth taking the blame. More »
- Morgan Stanley Warns of Recession
  
  Daily Telegraph (UK) | Dec 12, 07 6:11 PM CST
  
  (Newser) - Morgan Stanley is warning that the US is headed to a recession, the Telegraph writes, indicating today that factors such as the continued housing slump and high cost of borrowing will lead to decreased demand and a “perfect storm” for consumers. A partial freeze on subprime mortgages and expected cuts in interest rates will only soften the blow. More »
- Selloff May be Next Under New Citigroup CEO
  
  Bloomberg | Dec 12, 07 11:54 AM CST
  
  (Newser) - Major restructuring and sales of businesses appear to be on the table for embattled Citigroup, Bloomberg reports, with new CEO Vikram Pandit today promising a "front-to-back review" of operations at the financial giant battered by the subprime crisis. Citigroup stock has fallen 40% this year; one analyst called it "the worst-capitalized bank of its peers by a long shot." More »
- Freddie Mac Chief: Housing Market Will Get Worse in 2008
  
  Financial Times (UK) | Dec 12, 07 11:14 AM CST
  
  (Newser) - Predicting even tougher times for the US housing market, Freddie Mac chief Richard Syron yesterday told investors in New York that the government-sponsored mortgage lender would report another net loss in the fourth quarter and credit losses to $12 billion on its mortgage portfolio, reports the Financial Times. Freddie Mac reported a record $2 billion loss in the third quarter. More »
- Americans Split on Borrower Bailout
  
  CNN | Dec 11, 07 12:54 PM CST
  
  (Newser) - About half of Americans say borrowers snared in the subprime mortgage mess brought the trouble onto themselves, but they nevertheless deserve "special treatment," CNNMoney reports. In a poll of 1,002 adults, 51% also said they felt sorry for borrowers, with 46% blaming financial institutions' lending policies for the situation. More »
- US Economic Woes to Slow Tech Spending
  
  Wall Street Journal | Dec 11, 07 11:38 AM CST
  
  (Newser) - Tech-spending growth, on a roll since recovering from the 2000 dot-com bust beginning in 2004, is likely to slow next year, dragged down by US economic woes and rising oil prices, reports the Wall Street Journal. Research firms say companies are likely to keep spending, but more slowly. As one CIO said, “It’s not doom and gloom.” More »

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A for sale sign stands outside a modest bungalow on the market in southeast Denver on Monday, May 7, 2007. Sales of existing homes fell by a larger-than-expected amount in April while the median price... (Associated Press)

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Related Threads

Housing Market • Credit Market Chaos • The Big Banks • Is It Recession? • The Markets • Ben Bernanke • The Dow • Bear Stearns • Merrill Lynch • Fannie & Freddie

Background

Subprime Meltdown
Wikipedia

The subprime mortgage meltdown refers to the rash of subprime mortgage foreclosures that began in the United States in late 2006 and has continued into 2007. The sharp rise in foreclosures has caused several major subprime mortgage lenders, such as New Century Financial Corporation, to shut down or...

» Read more about Subprime Meltdown at Wikipedia

mortgage
The Columbia Encyclopedia, Sixth Edition

mortgage in law, device for protecting a creditor by giving him an interest in property of his debtor. In common law a mortgage was a conditional sale; i.e., the mortgagor (debtor) sold realty (real property mortgage) or personal property (chattel mortgage), but if the debtor paid the debt by ...

» Read more about mortgage at Encyclopedia.com

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