Analysis

Federal Reserve Knew of Serious Subprime Problems In 2006

Written by Leatherneck on August 29, 2007 under Analysis, Archives, Government Positions, Quotable Quotes, Root Causes

This may come as a shocking revelation to many of our readers. The Federal Reserve, and specifically the Federal Reserve Bank of Boston, already had data about subprime mortages. That data did not look good at all. Executives from specific lenders were called to testify before the Senate Committee on Banking, Housing, and Urban Affairs on March 22, 2007. While we might not be able to trust the executive spin this shocking data from the Fed is real:

Why HSBC Hopes the World Does Not Put 2 and 2 Together

Written by Leatherneck on August 27, 2007 under Analysis, Archives, Economic Impact, Editorial, Foreclosure, Government Positions, International, Investors, Job Losses, Lenders, Opinion, Outside the U.S., Root Causes

Why did the subprime money pipeline shut down? And which bank was buying mortgages from brokers and lenders? HSBC of course. Subprime and second mortgages were to HSBC like Household International was to predatory lending – an easy ride to profits. Or so they thought. Second mortgages? Sorry, but HSBC has little or no security interest when a home goes to foreclosure.

Reality TV comes to subprime

Written by Leatherneck on August 21, 2007 under Analysis, Archives, Opinion

We all know how popular reality TV can be. If you want to watch people getting stabbed in the back, raked over the coals, and messed with financially we have a deal for you. We can’t give you video because nobody made the TV show yet. But we can give you an RSS news feed that will bring continual daily updates right to your screen. Try this one.

New Trend Shows Credit Cards Paid Before Mortgage

Written by Timothy Blake on August 11, 2007 under Analysis, Archives

According to the latest Experian study on the sub-prime lending market, sub-prime consumers—those with an Experian credit score of 620 or lower—are more likely to be 30 days or more late on their mortgage payments than on their unsecured bankcard obligations. As consumers have historically paid mortgage debt over bankcard debt, this finding represents a significant departure from conventional behavior. There are several reasons why credit cards are being paid before home mortgage payments.

Time to Question IPO Motives and Risk

Written by Timothy Blake on August 04, 2007 under Analysis, Archives, Economic Impact

I hope the Securities Exchange Commission is more cautious in evaluating and granting private companies “ public” status, than lenders were with the mortgage industry. I am seeing more Initial Private Offering from private investment companies. Divisions of companies are being separated from parent companies and offered as IPOs. The categories of some of the IPOs are also difficult to define. Some but not all areas effected by mortgage fallout are investment, insurance, and home improvement retailers. A fellow researcher asked about the purpose of an IPO. Talk about a delayed fuse, I did not give it a serious thought at the time. I answered the question, “Raise capital and distribute risk”. I was deep in other research and resented the distraction.

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