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Wall Street Journal
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Jul 15, 08 9:51 AM CDT
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Mortgage insurers facing mounting defaults are tightening their standards, adding another hurdle for potential homebuyers, the Wall Street Journal reports. Beleaguered and risk-averse banks are making more mortgage applicants apply for insurance, just as insurers are declaring more parts of the country “declining markets.” making insurance harder to obtain. The result is “wreaking havoc” on the industry, one bank representative tells the Wall Street Journal.
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Reuters
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Jul 14, 08 2:40 PM CDT
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The Federal Deposit Insurance Corporation is looking to sell recently capsized IndyMac as a whole to one healthy bank, an executive told Reuters today. The FDIC took over IndyMac on Friday after nervous customers withdrew more than $1.3B in 11 days. "I don't expect there will be large bank failures," COO John Bovenzi said. "There will be small bank failures."
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Washington Post
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Jul 14, 08 1:44 PM CDT
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For years, critics have warned that Fannie Mae and Freddie Mac’s special status as government-sponsored enterprises allowed them to shoulder risk far beyond their minimal capitalization requirements, the Washington Post reports. The firms have used their unique position in the financial system, and high-intensity lobbying efforts, to quash any attempt at stricter regulation.
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New York Times
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Jul 14, 08 8:32 AM CDT
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The government's move to shore up Fannie Mae and Freddie Mac has led to new fears about the state of the American economy—but don't worry too much, writes Paul Krugman in the New York Times . Fannie and Freddie are problematic institutions, but compared to the actions of big banks who bought up repackaged subprime mortgages, the two mortgage giants have been relatively prudent.
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New York Times
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Jul 14, 08 6:54 AM CDT
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The teetering of Fannie Mae and Freddie Mac has underscored a major shift in US finance, writes Peter S. Goodman in the New York Times —once simply another guarantor, the government has effectively become the only lender in town "for millions of Americans engaged in the largest transactions of their lives." As commercial banks flee the market and credit dries up, Fannie and Freddie are now buying two-thirds of new mortgages.
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TheStreet
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Jul 12, 08 9:29 PM CDT
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IndyMac Bank's failure yesterday was a "wake-up call" to anyone with deposits above the $100,000 FDIC insurance limit, Terry Savage writes in Street.com. Americans have more than $2.6 trillion in uninsured accounts, and 10,000 depositors have more than $1 billion at risk at IndyMac alone. But before trying to rescue your money, learn how insurance applies to different kinds of accounts:
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Wall Street Journal
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Jul 12, 08 7:11 AM CDT
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Fears of a collapse of Fannie Mae or Freddie Mac finally eased yesterday after a stomach-churning rollercoaster ride that saw a 50% nosedive for the mortgage giants in early trading, writes the Wall Street Journal . A week of panic, prompted in part by reports that the government was preparing rescue scenarios, seem to have abated, as Fannie and Freddie were able to continue their regular borrowing. But a bigger test looms Monday when Freddie is due to sell $3 billion of short-term debt.
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Associated Press
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Jul 11, 08 8:35 PM CDT
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By a huge margin, the Senate today passed a $300 billion bill to help homeowners avoid foreclosure—but the White House vows to veto it unless the House makes changes, the AP reports. The bill will let struggling homeowners reinsure at cheaper rates backed by the government, but President President Bush says that nearly $4 billion in the bill, slated to fix up foreclosed homes, benefits lenders, not owners.
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Wall Street Journal
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Jul 11, 08 7:03 PM CDT
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As mortgage lenders Freddie Mac and Fannie Mae crowded the headlines today, Washington snatched up IndyMac Bank in the second-largest US bank failure in history, the Wall Street Journal reports. The Pasadena, Calif. savings and loan, which owns about $32 billion in assets, saw stocks fall from $45 last year to 28 cents this week as mortgage defaults piled up. It will reopen Monday under federal supervision.
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Wall Street Journal
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Jul 11, 08 12:26 PM CDT
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As fuel prices and home foreclosures steadily rise, Americans are trading down in everything from automobiles to their lunch options. That's not unusual in an economic downturn, but the speed with which it's happening is, the Wall Street Journal reports. And the flight to the affordable and generic is affecting the broadest array of goods since the recession of the early 1980s.
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Wall Street Journal
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Jul 11, 08 7:56 AM CDT
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What started as a whisper Monday is a roar at week’s end as investors wrestle with the fate of mortgage giants Fannie Mae and Freddie Mac, the Wall Street Journal reports. While neither firm, which together own or back roughly half the nation’s mortgages, faces imminent collapse, awareness that the government is mulling options for a bailout has sent Wall Street into a speculative downward spiral.
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Wall Street Journal
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Jul 10, 08 9:49 AM CDT
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With the shares of mortgage titans Fannie Mae and Freddie Mac plummeting to their lowest points in more than 15 years, the Bush administration is weighing what to do in the event of a collapse, reports the Wall Street Journal. No rescue plan is imminent—both companies are expected to be able to raise needed capital—but as home values continue to decline and more homeowners default, Treasury officials are studying contingency plans.
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Associated Press
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Jul 10, 08 7:19 AM CDT
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The number of homeowners stung by the rout in the US housing market jumped last month as foreclosure filings grew by 53% over June a year ago, according to data released today. One in every 501 US households was hit with a foreclosure filing last month.
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New York Times
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Jul 8, 08 8:26 AM CDT
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The Federal Reserve will issue new rules next week restricting subprime lending and other exotic loans aimed at borrowers with weak credit, Ben Bernanke said today. He said the Fed is also considering extending the overnight low-cost loan program, which helps big banks in need of quick cash, a sign that the Fed believes the financial crisis will continue into 2009.
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