Just when they thought the worst of the mortgage crisis was behind them, billions of dollars in bad loans from the debacle may be rising from the dead and creeping back on the balance sheets of the largest U.S. banks.
Big lenders including Bank of America (BAC), J.P. Morgan Chase (JPM) and Wells Fargo (WFC) may be forced to repurchase troubled home loans from insurers and mortgage-finance giants like Freddie Mac (FRE) that had agreed to take on risks associated with those assets during the real estate boom.
The banks are setting aside more reserves to cover the potential costs of such repurchases, cutting into earnings.
The trend is also pitting big lenders, insurers and mortgage-finance institutions against each other. That's a big change from the previous decade, when they worked together to fuel the housing boom by originating, insuring and securitizing mortgages in record amounts.
Christopher Whalen, managing director of research firm Institutional Risk Analytics, offered up a colorful metaphor for the unfolding situation.
"The wave of loan repurchase demands on securitization sponsors is the next area of fun in the zombie dance party, namely the part where different zombies start to eat each other," Whalen wrote in a note to clients Tuesday.
Mortgage insurers such as MGIC Investment (MTG) have rescinded, or refused to pay, roughly $6 billion in claims from delinquent home loans since January 2008, rating agency Moody's Investors Service estimated in a December report. That could leave banks that originated the loans on the hook for losses.
More Here..
The next wave of mortgage resets are four times bigger then subprime ever was. on top of this we have commercial real estate larger then the option arm and alt-a dirty bomb. america is is a clusterfuck nation: education crisis,manufacturing crisis,fiscal crisis,financial crisis,state and city insolvency crisis,unfunded pension crisis etc. america is bomb ready to go off. we are angry and armed to the teeth and there are many factions among us. America is divided and is going to dissolve into utter chaos. America was born in blood. America suckled on blood. America gorged on blood and grew into a giant, and America will drown in blood
ReplyDeleteMy husband had a job interview in San Diego today. There were about thirty large business buildings there and I'd say a good thirty of them were for lease. Only two seemed to be functioning or partially functioning. One of the buildings still open for business was a college.
ReplyDeleteAnyone who cannot see this for the giant collapse that it is RIGHT NOW, seriously needs to stop taking the psychotropics or whatever they're on and smell the coffee.
Oh yes, and at the job interview there were seven people total. They were young men, and they were complaining about the economy. Two said they were moving either midwest or to the south. One said up north. These are young people who cannot find jobs and several of them used to make decent money.
ReplyDeleteThis is our future??? WAKE UP PEOPLE, the DEPRESSION IS HERE!!!!!!!!!!!!!!
Dear Ole Mardochee,
ReplyDeleteYou sure are into this blood thing now ain't cha ?
In a much previous blog I delved into the whole "faction" thing and boy! did I piss some people off by commenting " we have so many large ethnic groups all Vying for the same resource"
I was just wondering as if that is what your pertaining too here in your post??
Sorry.. I don't see it. Things are still improving, slowely, but they are still improving. There is no depression coming.
ReplyDelete8:38 What are you doing on the internet so late? Don't you know your mommy said it's time for bed? You've got a full day in front of you tomorrow -- don't forget your show and tell project!
ReplyDeleteObama has his ACORN group going again I see...
ReplyDeleteJust ask the banks why they do not claim TWO million dollar homes in our neighborhood.. ..They sit vacant for almost one year now... Thanks for screwing the world Mr Bankers
ReplyDeletethe repugs have their criminals spying on dems again I see also, shades of their criminal buddy nixon
ReplyDelete9:45 you sound very childish using a word like "repugs", not to mention, bringing up an unassociated topic (if it even is one worthy of being called a topic) here makes you appear foolish.
ReplyDeleteGo REPUG yourself -- we're all sick of people like you who just want to cause dissent when the facts are clear that this country is falling.
COWARD.
Hold on.
ReplyDeleteDoes this song remind you of anything?
We're off to FEMA camp!
We're off to FEMA Camp!
So happy and free!
We're off to FEMA camp!
They've got a cot for me!
Three square and a roof my friend!
So happy and free.
Hey, why are there those giant smokestacks at FEMA camp?
The Coming Depression should move into its next phase and be The Present Depression!
ReplyDeleteI'll let you all you guys in on a little secret. Come on a little closer....Yes..We all now that this is entire economy is one giant Ponzi Scheme. But you know what. The U.S. can just keep it going forever and a day because they'll just print dollars they can't get by producing things. It's worked since 1913. 95% of the value is already gone. What's another 4.9999999%.
ReplyDelete12:43 don't quit your day job (if you still have it)
ReplyDeleteHave no fear - The Taxpayer Reinsurance Company is here!
ReplyDeleteWell, worldwide, everyone is in the same boat.
ReplyDeleteAll currencies are fiat. Isn't that one difference from the first Great depression?
A rising tide lifts all boats, but a sinking tide does what when everyone's in the same currency boat?
Hey!!! We have some yanks on this site who wish to stiffle
ReplyDeleteanything good. You all suck big time. That's why your called suckers.
So focused on the bad, the ugly, the depressing. YOU SUCK. and kiss
my- ass freaking degenerate reprobate mindless sour fear mongoring
hate driven traitors of faith and American patronage! These are the
TRUE COWARDS ladies and gents. Beware of the propaganda that
comes from this page. They lay in wait for your faith so thy can cllaw
you down to their discusting level of gravelig in sick basterdly despair.
You won't get me you sick freaks!
Jesus is love!
ReplyDeleteJesus never lied!
Jesus is the Way, the Light, and the Truth.
All who call on the name of Jesus will be saved.
Amen.
:)
I agree with the last comment. Plus I'll add that there's no point in living in fear or complaining about our situation in this country. It's not only our government that's caused this but also the way we live in this country. We are a nation that has thrown God's word(bible) right out of the window and now we're wondering what happened. We have become a nation that tolerates everything and hates nothing. What I mean about hates is that we just don't hate our sinful and wicked ways. God is not going too bless us if we just continue too spit in his face and not repent of our sins. If you think I'm full of it the bible will give you plenty of examples of great empires that have fallen because of their wicked ways, lack of repentance and God's Judgement on them. If people can't see this then there's no hope for you. But Jesus came to offer that hope and I urge you now that if you want to be saved from your sins then ask Jesus into your heart and make Him Lord of your life then you won't have to live in fear of whats coming because Jesus will give you hope in a better day to come, a day in which we will be with Him for all eternity. God bless you all.
ReplyDelete