ragerunner

Bank reform has stalled, warns IMF "Financial regulators need to consider breaking up big banks to make the global economy safer, the International Monetary Fund said as it blasted the authorities for letting the reform programme stall and warned that the system remains “vulnerable and overly complex”. Banks are as risky as they were before the financial crisis and are devising new ways of gaming the rules, the IMF warned in an analytical chapter of its Global Financial Stability Report. To build a safer system, regulators need to “refine” policy further, including “a global-level discussion on the pros and cons for direct restrictions on certain business activities for banks, rather than just requiring them to hold more capital”, the IMF said." http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/9565290/Bank-reform-has-stalled-warns-IMF.html

Consumer-confidence gauge at 7-month high "WASHINGTON (MarketWatch) — Led by expectations, a gauge of consumer confidence jumped in September to its highest level in seven months yet remained relatively low, the Conference Board reported Tuesday." http://www.marketwatch.com/story/consumer-confidence-gauge-at-7-month-high-2012-09-25 The US and Japan has had the luxury of the world being mostly focused on Europe, its debts and problems. One day this attention will turn to us and Japan and our debt stories are not very pretty either. Debt crisis: as it happened, September 25, 2012 "The eurozone will not start to grow until at least 2014, according to forecasts by Standard & Poor's, as the rating agency said it now expected Spain's economy to contract by 1.4pc next year." http://www.telegraph.co.uk/finance/debt-crisis-live/9564009/Debt-crisis-as-it-happened-September-25-2012.html Recovery will be 'painful', IMF's Christine Lagarde warns "Heavily indebted countries like the UK face years more “painful” austerity to get their economies back on an even keel, International Monetary Fund managing director Christine Lagarde has warned." http://www.telegraph.co.uk/finance/economics/9563445/Recovery-will-be-painful-IMFs-Christine-Lagarde-warns.html Spain risks break-up as Mariano Rajoy stirs Catalan fury "The ruling parties of Catalonia have sought guidance from Brussels on the legality of secession from Spain, requesting a “route map” for membership of the European Union and the euro as an independent state." http://www.telegraph.co.uk/finance/financialcrisis/9556803/Spain-risks-break-up-as-Mariano-Rajoy-stirs-Catalan-fury.html

Many other energy sources have additional cost to them. Including environmental cost and with oil the cost of keeping it flowing throughout the world. So does wind, in addition to its higher direct costs, especially when you're talking about massive wind farms. I guess I was talking more about the cost of securing oil from overseas (wars, military installations, etc.) I don't think wind has those cost attached.

Many other energy sources have additional cost to them. Including environmental cost and with oil the cost of keeping it flowing throughout the world.

A quick look at some of the job cuts announced over the last week. Alpha closing 8 mines, cutting 1,200 jobs in all "Coal producer Alpha Natural Resources said Tuesday it was cutting production by 16 million tons and eliminating 1,200 jobs companywide, laying off 400 workers immediately by closing mines in Virginia, West Virginia and Pennsylvania." http://seattletimes.com/html/nationworld/2019187163_apusalphalayoffs.html Siemens to lay off 615 in Iowa, Kansas, Florida "DES MOINES, Iowa — Wind energy equipment manufacturer Siemens Energy Inc. will lay off 615 workers in Iowa, Kansas, and Florida in part because Congress has not renewed a tax credit for wind energy, the company said Tuesday." http://www.cbsnews.com/8301-505244_162-57515251/siemens-to-lay-off-615-in-iowa-kansas-florida/ American Airlines Expects About 4,400 Job Cuts, Warns 11,000 "DALLAS (AP) _ American Airlines is sending layoff warning notices to more than 11,000 employees although it expects job losses to be closer to 4,400." http://www.kcautv.com/story/19579603/american-airlines-expects-about-4400-job-cuts-warns-11000 FirstEnergy to lay off 200 in Akron; details in November http://www.ohio.com/news/break-news/firstenergy-to-lay-off-200-in-akron-details-in-november-1.335714 Bank of America to Cut 16,000 Jobs by Year-End: Report "Bank of America is planning to cut 16,000 jobs by year end as it speeds up a company-wide cost-cutting initiative amid declining revenues, The Wall Street Journal reported on Wednesday." http://www.cnbc.com/id/49098399

Beijing hints at bond attack on Japan "A senior advisor to the Chinese government has called for an attack on the Japanese bond market to precipitate a funding crisis and bring the country to its knees, unless Tokyo reverses its decision to nationalise the disputed Senkaku/Diaoyu islands in the East China Sea." "Writing in the Communist Party newspaper China Daily, Mr Jin called on China to invoke the “security exception” rule under the World Trade Organisation to punish Japan, rejecting arguments that a trade war between the two Pacific giants would be mutually destructive. Separately, the Hong Kong Economic Journal reported that China is drawing up plans to cut off Japan’s supplies of rare earth metals needed for hi-tech industry. The warnings came as anti-Japanese protests spread to 85 cities across China, forcing Japanese companies to shutter factories and suspend operations. Fitch Ratings threatened to downgrade a clutch of Japanese exporters if the clash drags on. It warned that Nissan is heavily at risk with 26p of its global car sales in China, followed by Honda with 20pc. Sharp and Panasonic both have major exposure." http://www.telegraph.co.uk/finance/china-business/9551727/Beijing-hints-at-bond-attack-on-Japan.html

I wonder how many jobs will be cut in their cost-cutting effort? FedEx profit down 1.1% on manufacturing slowdown "--FedEx says a weak economy drove a shift to non-premium services --Volume in its priority international export segment was down 2% --The company plans to detail its cost-cutting effort during a meeting next month" http://www.marketwatch.com/story/fedex-profit-down-11-on-manufacturing-slowdown-2012-09-18?dist=lcountdown If Goldman said it, its got to be true. Such a fine outstanding company. Home-builder optimism hits 6-year high Goldman Sachs sees favorable recovery scenario for U.S. market "The National Association of Home Builders/Wells Fargo housing market index gained 3 points to a seasonally adjusted reading of 40, the highest the index has been since June 2006. Economists polled by MarketWatch had anticipated a reading of 38. The index still isn’t at the 50 level indicating “good” conditions but has climbed back from as low as 8 during the recession. The index didn’t even break 20 until December 2011." http://www.marketwatch.com/story/builder-optimism-in-september-hits-six-year-high-2012-09-18?dist=lcountdown So the average joe on main street gets the shaft again. What part of a sustainable economic recovery is QE creating. Lets see, artificially higher prices on metals and commodities and some nice extra profits for Wall Street. Main street then pays more for necessities, food, gas, etc. 3 sectors poised to benefit from QE 3 "This time around, a growing number of investors want to be ready to take advantage of the opportunity to benefit from their own "economic recovery" plans, and focus on those sectors which are likely to produce the best results during QE 3. Based on what we have seen during previous quantitative easing programs, the most likely sectors to produce big gains are the precious metals and commodities sectors." "While economists and analysts debate the pros of cons of QE 3 and how it could help or hurt the economy, it seems clear that quantitative easing is good for investors. How long these beneficial tailwinds will last is unknown, but the current environment could provide another opportunity for investors to fatten their portfolios over the coming weeks and months." http://www.marketwatch.com/story/3-sectors-poised-to-benefit-from-qe-3-2012-09-18?dist=lcountdown Spain just keeps going deeper into the hole and the head of Bundesbank talks about the print shop. Debt crisis: Spanish bad bank loans climb - live "Jens Weidmann defends his right to speak out about concerns over ECB policy, and uses Faust's Mephistopheles to describe printing money to help governments as temptation from the devil." "Jens Weidmann, the head of the Bundesbank, has once again criticised unlimited bond buying by central banks. Although he did not directly refer to the ECB's bond buying plans, Mr Weidmann said that central banks that promise to create unlimited amounts of money risk fuelling inflation and losing their "credibility". In a speech in Frankfurt, he said: If a central bank can potentially create unlimited money from nothing, how can it ensure that money is sufficiently scarce to retain its value? Is there not a big temptation to misuse this instrument to create short-term room to manoeuvre even when long-term damage is very likely? Yes, this temptation is very real, and many in the history of money have succumbed to it. If one looks back in history, central banks were often created precisely to give the monarch the freest possible access to seemingly unlimited financial means. The connection between states’ great financial needs and a government controlling the central bank often led to an excessive expansion of the money supply, and the result was devaluation of money through inflation. The independence serves much more to establish with credibility that monetary policy can concentrate without hindrance on keeping the value of money stable." http://www.telegraph.co.uk/finance/debt-crisis-live/9549698/Debt-crisis-Spanish-bad-bank-loans-climb-live.html

No matter what your take is on QE3 (good or bad), it clearly shows we are still in a noticable economic hole, because these QEs are only used for economic crisis situtations. From ‘awful policy’ to a ‘logical action,’ reactions to QE3 September 13, 2012, 3:38 PM "Stock market bulls are in no doubt about their reaction to the Fed’s move Thursday to launch a new round of quantitative easing to boost the labor market. But other observers are having mixed reactions to the open-ended bond purchases plan. From around the web, here’s a sampling of key statements by the Fed and reaction to them." http://blogs.marketwatch.com/thetell/2012/09/13/from-a-major-shift-to-a-logical-action-reactions-to-qe3/

Here are the newest designs of the rail station and new Westin Hotel at Denver International Airport that has been released. The project(s) are now under construction with the hotel opening in 2015 and the rail line and station opening in January 2016. And here is a look at three of the buildings going up at Denver's Union Station. The first is a new luxury apartment tower (ground floor retail) and the other two will be located on the north and southsides of the historic station building. Source - http://denverinfill.com/blog/category/transportation/transit/page/2 Source - http://denverinfill.com/blog/2012/05/union-station-district-project-update-cadence-apartments.html

But, but, on Thursday the sky was the limit. All was well, the stockmarket shot up so well it even ignored the poor employment data. Once again it the same cycle, hope equals more hope but reality continues to be very different than most of the headlines. Debt crisis: ECB's Draghi Plan doused by rebellions in Germany and Greece "A delay to the highly anticipated German court decision on bail-out funding and a rebellion in the Greek government over austerity doused hopes that the European Central Bank will be able to stem the crisis after all." "Germany’s federal constitutional court said it might be forced to delay its ruling on the legality of the European Stability Mechanism (ESM) because of an eleventh hour objection by an MP. Peter Gauweiler, a member of Angela Merkel’s ruling coalition, argued that the court ruling, due on Wednesday, should take time to assess the impact of the ECB’s “outright monetary transactions”, announced last week." "Meanwhile, Antonis Samaras, the Greek prime minister, failed to deliver the approval of his two coalition partners for the €11.5bn (£9.2bn) programme of cuts needed to secure the next tranche of international aid." http://www.telegraph.co.uk/finance/financialcrisis/9534043/Debt-crisis-ECBs-Draghi-Plan-doused-by-rebellions-in-Germany-and-Greece.html Soros: Germany’s heading into depression "SAN FRANCISCO (MarketWatch) — Europe’s recession will intensify and spread to Germany, the euro zone’s largest economy, within six months, said George Soros, chairman of Soros Fund Management." “The policy of fiscal retrenchment in the midst of rising unemployment is pro-cyclical and pushing Europe into a deeper and longer depression,” Soros said in prepared remarks for a Monday speech in Berlin. “That is no longer a forecast; it is an observation. The German public doesn’t yet feel it and doesn’t quite believe it. But it is all too real in the periphery and it will reach Germany in the next six months or so.” http://www.marketwatch.com/story/soros-germanys-heading-into-depression-2012-09-10?dist=afterbell

The world has been saved today. So debt will be transfered from one hand to another hand and that debt still will not be able to be paid back. :-o Draghi unveils ECB bond-buying plan Sweden cuts key rate, while Bank of England stands pat "FRANKFURT (MarketWatch) — European Central Bank President Mario Draghi on Thursday said the central bank is prepared to buy government bonds in unlimited quantities in order to eliminate harmful distortions in financial markets fueled by fears of a euro breakup, but reiterated that participating countries must promise to abide by strict conditions. The new Outright Market Transactions, or OMT, program “will enable us to address severe distortions in government bond markets which originate from, in particular, unfounded fears on the part of investors of the reversibility of the euro,” Draghi told reporters at his monthly news conference." http://www.marketwatch.com/story/bank-of-england-policy-unchanged-focus-on-ecb-2012-09-06?dist=lcountdown Debt crisis: live "Markets hit five-month high after Mario Draghi announced that the ECB will buy bonds on the secondary market in a bid to curb the debt crisis, as the OECD slashes the UK's growth forecasts for 2012 from 0.5pc to -0.7pc." "Germany's economy ministry has said that ECB bond-buying cannot be a permanent solution and structural reforms must be the priority." "Bailouts – whether by government or the ECB – can, at best, buy time. At worst, however, they act as an outright disincentive for necessary reforms. This risk was eloquently highlighted by Professor Leszek Balcerowicz – former Polish Finance Minister (and central bank head), famous for implementing the Polish structural reform plan following the fall of communism – at an Open Europe event last week. "All bailouts, he said, come with "moral hazard". But if mishandled, ECB bond-buying could actually turn out to be the worst form of Eurozone bailout, as it completely de-links the bailout cash from reforms needed, creating a moral hazard problem of massive proportions (in addition to creating a number of other problems such as undermining the rule of law and making ECB susceptible to political influences). We’ve seen the signs already. As ECB board member Jörg Asmussen noted recently, "There cannot be a repeat of the mistakes with Italy in the summer of last year, when the ECB bought Italian sovereign bonds and the time was unfortunately not used for necessary adjustment measures". http://www.telegraph.co.uk/finance/debt-crisis-live/9523681/Debt-crisis-live.html Private payrolls post largest gain in five months Labor Department report on nonfarm payrolls due on Friday "Private-sector payrolls rose by 201,000 in August, led by small businesses and the service-providing sector, beating Wall Street’s expectations." http://www.marketwatch.com/story/private-payrolls-post-largest-gain-in-five-months-2012-09-06?dist=lcountdown U.S. jobless claims drop 12,000 to 365,000 "Hurricane Isaac did not affect applications for benefits WASHINGTON (MarketWatch) — The number of people filing for state unemployment benefits for the first time fell 12,000 to a seasonally adjusted 365,000 last week, the biggest drop since mid-July, the Labor Department reported Thursday." "The four-week average of new claims inched higher, up 250 to 371,250. The four-week average smooths out the data to minimize the impact of one-time changes due to weather, strikes or holidays." http://www.marketwatch.com/story/us-jobless-claims-drop-12000-to-365000-2012-09-06?dist=lcountdown

Stocks waver; FedEx sinks after profit warning "NEW YORK—U.S. stock prices bounced between small gains and losses Wednesday, held in check by a warning from the huge package delivery company FedEx that its profits would be hurt because of a slowdown in the global economy." "It's one more piece of news that suggests that the global economy is slowing and therefore makes central bank action more likely," said Brian Gendreau, market strategist at the investment advisory firm Cetera Financial." Read more: Stocks waver; FedEx sinks after profit warning - The Denver Post http://www.denverpost.com/businessbreakingnews/ci_21471558/us-stock-futures-down-after-fedex-profit-warning#ixzz25cyDOhRk Read The Denver Post's Terms of Use of its content: http://www.denverpost.com/termsofuse

As Financial Scandals Mount, Individual Investors Flee Stocks “The public has never been more disconnected. At the end of the day, the citizenry has lost trust and confidence in the underlying mechanism. What used to be an investors’ market is now thought of as a traders’ market.” —NYSE Euronext CEO Duncan Niederauer, testifying before the U.S. House of Representatives’ Financial Services subcommittee." "At the same time, “other strategies may be recognized as unacceptable,” like “stepping ahead or front running of investors’ orders, manipulation of orders, fraudulent trading.” "The faith of individual investors was severely damaged by the financial crisis and it has yet to recover, because the financial markets keep throwing one more unsettling event after another right at them: •Barclay’s $455 million settlement with U.S. and U.K. regulators of charges it attempted to manipulate the London Interbank Offered Rates (LIBOR). •The loss by J.P. Morgan of over $2 billion in what was supposed to be a hedging strategy to reduce risk in the bank’s loan portfolio. •The Facebook IPO trifecta: NASDAQ trading glitches in the first hours of trading, a 20%+ aftermarket decline in the price of FB shares, and last minute disclosures by analysts of downward revisions in Facebook’s revenue growth rates. •The bankruptcy of MF Global and the alleged disappearance of $1.6 billion in customer funds, despite rules prohibiting the commingling of corporate and customer assets. •The rolling, escalating European sovereign debt crisis. •The almost unimaginable spectacle of the United States of America flirting with default in the summer of 2011 (which we may yet revisit after the Presidential election). •The Flash Crash of May 2010, where the market dropped almost 1,000 points in an hour. Yes it recovered, but no one has ever come up with a plausible explanation for what exactly happened. We have reached the point where perceptions (largely negative perceptions) have become reality. Individual investors are easily spooked and are interpreting almost everything as yet another reason to stay out of the equity market." http://www.forbes.com/sites/ciocentral/2012/07/11/as-financial-scandals-mount-individual-investors-flee-stocks/

July construction spending down 0.9% "WASHINGTON (MarketWatch) -- Construction spending fell 0.9% in July, missing analysts' estimates, to a seasonally adjusted annual rate of $834 billion, the Commerce Department said Tuesday. Analysts polled by MarketWatch had expected a July gain of 0.5%. Private residential construction fell 1.6%, while private nonresidential construction fell 0.9%." http://www.marketwatch.com/story/july-construction-spending-down-09-2012-09-04-10911431?dist=lcountdown ISM factory index weakens to 49.6% in August "WASHINGTON (MarketWatch) - Activity for the nation's manufacturers showed contraction for the third straight month in August, the Institute for Supply Management reported Tuesday. The ISM index fell slightly to 49.6% in August from 49.8% in July. This was weaker than expected. The consensus forecast of estimates collected by MarketWatch was for the index to rise to 50.2%." http://www.marketwatch.com/story/ism-factory-index-weakens-to-496-in-august-2012-09-04?dist=lcountdown Asia stocks down after China manufacturing falls "Asian stock markets are mostly lower following data that showed a contraction in Chinese manufacturing for August. An industry report said that China's purchasing managers index fell to 49.2 in August from July's 50.1 on a 100-point scale. Numbers below 50 show a contraction. It was the group's weakest reading to date." http://www.thetelegraph.com/news/ap_news/asia/article_4fb34ad0-5ff3-5847-88f7-7d31e53d3ddf.html June Foodstamp Recipients Hit All Time High As Three Times As Many Americans Enter Poverty As Find Jobs "Indicatively, the 173,600 increase in Foodstamps recipients in June was three times greater than Americans finding jobs (64,000, most of which part-time) according to the BLS." http://www.zerohedge.com/news/june-foodstamp-recipients-hit-all-time-high-three-times-many-americans-enter-poverty-find-jobs

Bernanke: QE has and can work more Fed chairman expresses “grave concern” about the labor market "In a speech at the Fed’s Jackson Hole retreat on Friday, Bernanke did not pre-commit to taking action. But he did reinforce the case for more asset purchases." "Bernanke called current growth “tepid” and said the economy was “far from satisfactory.” “Taking due account of the uncertainties and limits of its policy tools, the Federal Reserve will provide additional policy accommodation as needed to promote a stronger economic recovery and sustained improvement in labor-market conditions in a context of price stability,” Bernanke said." "With the Fed’s traditional interest-rate tool stuck between zero and 0.25% since December 2008, the Fed has had to rely on asset purchases and forward guidance to support the recovery. Using these policies for the first time has been challenging, Bernanke said. As a result, the bar for use of these policy tools is higher than for traditional policies, he said." http://www.marketwatch.com/story/bernanke-qe-has-and-can-work-more-2012-08-31-101031933?dist=lcountdown

Interesting read. The “Pauperization of Europe” Wolf Richter www.testosteronepit.com "It started on Monday. “Poverty is returning to Europe,” said Jan Zijderveld, head of Unilever’s European operations, in an interview. The British–Dutch consumer products company, third largest in the world, was adjusting its commercial strategy to this new reality, he said, by redeploying to Europe what worked in poor countries of the developing world. Now the stars of the industry are affirming it. “The logic of pauperization,” L’Oréal CEO Jean-Paul Agon called it on Wednesday." “If Spaniards are down to spending on average €17 per shopping trip, I can’t sell him detergent for half of his budget,” Zijderveld explained. “In Indonesia we sell individual packages of shampoo for 2 to 3 cents and still earn a fair amount.” "By looking at Europe, particularly Southern Europe, as a market with the characteristics of developing countries, Unilever has transitioned from seeing the debt crisis as a temporary event to seeing it as a trend to which it had to adjust its strategies. So now in Spain, it sells its “Surf” detergent in packages that are good for five loads. In Greece, it sells mashed potatoes and mayonnaise in small packages. And in Great Britain (!), it’s implementing the same strategy. Because people are running out of money. And it’s been successful. Since they started this in 2011, sales have stopped falling; and in the first half of the year, they edged up 1.1%. But higher input prices have exerted pressures on margins and profits." “I agree, there is a movement of very sharp pauperization in Southern Europe,” Michel-Edouard Leclerc said on Wednesday—they’re now all coming out. He’s the CEO of E.Leclerc, the number one retailer in France with a market share of 18% and 556 semi-independent hypermarkets, supermarkets, and specialty stores. It also has numerous stores in Italy, Spain, Portugal, and other countries. And the company is adjusting to the new reality. In Italy, for example, where the stores used to sell yoghurt only in multipacks, they’ve started to sell them as single items." http://www.zerohedge.com/contributed/2012-08-29/%E2%80%9Cpauperization-europe%E2%80%9D

Consumer confidence falls to 9-month low Americans more worried about economy, job prospects "WASHINGTON (MarketWatch) — Consumer confidence fell to a nine-month low in August as Americans grew more worried about the economy and the chances of finding a job, according to a survey released Tuesday. The Conference Board said its confidence index dropped to 60.6 last month from 65.4, marking the lowest level since November. Economists surveyed by MarketWatch had forecast the index to rise slightly to 66.0." http://www.marketwatch.com/story/consumer-confidences-falls-to-9-month-low-2012-08-28 U.S. home prices continue upward move in June "WASHINGTON (MarketWatch) — U.S. home prices bounced higher for a second month in June, according to an index released Tuesday which showed the strongest back-to-back monthly advance in the more than decade-long history of the price gauge." http://www.marketwatch.com/story/us-home-prices-continue-upward-move-in-june-2012-08-28

When you bemoaned pricing falling too quickly...... I said let them fall. Then, when prices not falling quickly enough fits the narrative, you allege some illicit conspiracy. To be clear, I think we got into this situation because financial gamers figured out how to rig (technically in a legal way albeit perhaps morally repugnant) the system so that they could still profit on the net while thousands of borrowers lost their homes when crushed in debt. Irresponsible lending and irresponsible borrowing. Those are the practices that needs to stop. A higher degree of ethics and standards, similar to that imposed on other professions, needs to be injected into financial lending I don't see the connection between that and the banks seeking to protect their investments by not flooding the market and I know of no legal obligation they have to meet your demands. If they want to sit on properties, that is fine by me. It's probably good for me as a homeowner who is not under water, as a matter of fact. What I care about is the actions they take to sell the properties once they've put the inventory on the market....... i.e. whether they will continue to sell the house to people they know won't be able to afford it. Really. I am bemoaning prices falling, what are you reading? My main point on this thread and on the first housing thread has ALWAYS been that prices are to high, they need to return to the historic level of 30% of income and are causing a negative economic impacts on main street. Any action that is taken not to allow housing to return to historic levels I have pointed out as a determint to the long term stability of the US economy. I am amazed how often you misread this thread.

US Consumer debt near record levels again. This should play out well. US consumers cut back on credit card use in June CHRISTOPHER S. RUGABER, AP Economics Writer "Consumer borrowing rose by $6.5 billion in June from May to total $2.58 trillion, the Federal Reserve said Tuesday. That's just below the all-time high reached in July 2008. Auto and student loans rose by $10.2 billion to $1.71 trillion in June." Read more: http://www.greenwichtime.com/news/article/US-consumers-cut-back-on-credit-card-use-in-June-3769426.php#ixzz24mDReXar Chart showing the consumer debt levels. http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2012/08-2/20120827_debt1.png

I think one of the main topics of this thread is how they got in this situation to begin with. That was also the focus of my comments on the banks with holding REOs. Low interest rates, unsustainable housing prices vs incomes, etc. We are simple starting the same cycle over and if we blow another housing bubble (just as we did in the past) we will experience a very similar fallout. How do you think they got in this situation?

I know it will probably not help to change your opinion, which is fine, but I have talked with RE Brokers, that do only foreclosure sales for the big banks and they even say the banks are coordinating in the amount of homes release on each market.

China announces £800bn stimulus to boost confidence "China has announced a total of 8 trillion yuan (£800bn) of "stimulus projects" to try to boost confidence in an economy that appears to be cooling faster than expected." "Meanwhile, Wen Jiabao, the Chinese premier, promised over the weekend that the Chinese government would intensify its efforts to boost the economy in the second half of the year." http://www.telegraph.co.uk/finance/china-business/9500548/China-announces-800bn-stimulus-to-boost-confidence.html

If they are holding 90% of the REO off the markets, then its not a coincidence.

So are banks and Fannie/Freddie holding back on inventory to restrict supply and increase prices? I think so. As before we can debate weather this is an OK practice or not. But it's becoming very clear it is happening in a large way and if successful (with home prices rising noticeable across the US this year - even though job growth and incomes are not) it will burden future buyers with home prices above the historic cost to income ratio, create another round of buyers in a manipulated/bubble market and end up in another future housing crisis. Withholding 90% of the inventory is a clear manipulation of supply and demand that will simple blow another bubble at the expense of main street. It is also becoming clear that holding out 90% of the REO does take a coordinated efforts from the major banks and the government (Fannie and Freddie). For those that don't believe that the banks and the government could coordinate at such a high level, we have learned about their joint efforts on libor and now we learn about their joint efforts on housing inventory. 'Shadow REO': As Many as 90% of Foreclosed Properties Held Off the Market, Estimates Suggest "This home is part of what's known as the "shadow REO" inventory: repossessed homes across the country that banks or investors often purposely keep off the market. The practice isn't a secret, and refraining from dumping a large inventory of foreclosures on the market helps to keep home prices from crashing." "As many as 90 percent of REOs are withheld from sale, according to estimates recently provided to AOL Real Estate by two analytics firms. It's a testament to lenders' fears that flooding the market with foreclosed homes could wreak havoc on their balance sheets and present a danger to the housing market as a whole." "Analytics firm CoreLogic provided an even lower estimate, suggesting that just 10 percent of all REOs in the country are listed by their owners, which include mortgage giants Fannie Mae and Freddie Mac as well as the Federal Housing Administration. As of April 2012, 390,000 repossessed homes sat in limbo, while about 39,000 were actually listed for sale, said Sam Khater, senior economist at CoreLogic." http://realestate.aol.com/blog/2012/07/13/shadow-reo-as-much-as-90-percent-of-foreclosed-properties-are-h/

Slumping Commercial Real Estate Sales Are Latest Flashing Red Non-Recovery Indicator "Real Capital Analytics (RCA) released their US commercial real estate transaction data for July last night. The only way to interpret the data is - ugly. After a dismal June (down 33% YoY), July did not see any bounce and in fact plunged 20% YoY with transactions totaling $14.6bn. As Barclays notes, the takeaway is generally negative, as the growth trend has weakened considerably since March ( which was +62% YoY). What is interesting to us is that with Treasury yields so low, the cap-rate 'spread' makes commercial real estate relatively attractive and yet no-one's buying." http://www.zerohedge.com/news/slumping-commercial-real-estate-sales-are-latest-flashing-red-non-recovery-indicator U.S. weekly jobless claims rise to 372,000 "Applications reflect little change in nation’s hiring trends Initial claims increased by 4,000 to a seasonally adjusted 372,000 in the week ended Aug. 18, the Labor Department said. That’s the highest level in five weeks. Economists surveyed by MarketWatch had projected claims would rise to 369,000. Initial claims from two weeks ago were revised up to 368,000 from an original reading of 366,000, based on more complete data collected at the state level." http://www.marketwatch.com/story/us-weekly-jobless-claims-rise-to-372000-2012-08-23