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REMINDER: All investment, economics, and finance related material now appears at the new IaconoResearch.com. For the time being at least, this has become a personal blog covering a variety of mostly unrelated topics.
It’s funny that we would get this in the mail today from Wells Fargo, the bank that happened to have been on the other end of our short sale transaction that, after four months of disappointment, we finally pulled the plug on as detailed here yesterday.
We took our first step back in May…
That “First rule of homebuying” should probably be: “Don’t try to buy a short sale from us”.
Well, maybe it’s a good thing that the short-sale offer we made back in May didn’t pan out as we had hoped because, according to this report by Diana Olick over at CNBC, the banks added a record number of homes to their REO list last month and, as I understand it, these deals are much easier to get done than short-sales.
The nation’s banks repossessed a record number of homes in August, according to industry sources. RealtyTrac, an online foreclosure sale site, will release its monthly numbers on Thursday, but sources there confirm the number of repossessions will come in just shy of 100,000 for the month.
That is the highest since the site began tracking in 2005. July’s repossession number was the second highest on record. The last highest was 93,777 in May of 2010.
Notices of Default, which are the first step in the foreclosure process, are up slightly but mostly thanks to a jump in California, where the numbers had been artificially low of late, as banks tried to modify borrowers.
“With respect to the NOD increase, I think it is the modification redefault wave beginning to build and new modifications slowing to a trickle, indicating banks have lost their primary borrower re-leveraging tool,” says mortgage industry consultant Mark Hanson.
Yeah, it’s about time the loan modification redefault wave hit – in the end they’ll look back at that effort as one that only helped the banks to “extend and pretend” another nine months. And to think that the bank involved with our short-sale offer actually raised the price they thought they could get from us over about the last five or six weeks. Amazing…
As they’ve been doing for nearly a decade now, most economists and financial advisers are probably shaking their head again at those foolish traders who have bid precious metals prices to new heights, gold reaching a new all-time high today above $1,270 an ounce.
Now free of some technical constraints after having entered uncharted territory – a development that oftentimes compels traders to bid prices sharply higher as there is no “resistance” – don’t be surprised if we see $1,300+ prices in the not-too-distant future, a level that some analysts have identified as an area to take profits.
About a hundred miles from here in Butte, Montana yesterday, billionaires Warren Buffett of Berkshire Hathaway and Steve Ballmer of Microsoft Corp. were the main attractions for the annual Montana Economic Development Summit, both of them seeming to be quite optimistic about the economy. This Washington Post report has all the details:
“I am a huge bull on this country. We are not going to have a double-dip recession at all,” said Buffett, chairman of Omaha, Neb.-based Berkshire Hathaway Inc. “I see our businesses coming back across the board.”
Buffett said the same things that worked for the country through a century of two world wars, a depression and more – all while increasing the standard of living – will work again. He said banks are lending money again, businesses are hiring employees and he expects the economy to come back stronger than ever.
“This country works,” Buffett said during a question-and-answer session via video at the Montana Economic Development Summit. “The best is yet to come.”
The likes of Buffett, Microsoft Corp. CEO Steve Ballmer and General Electric Co. Chairman Jeff Immelt told the nearly 2,000 business leaders, government officials, aspiring entrepreneurs and others at the summit that things are getting better. They also offered some ideas for what needs to be done.
Ballmer said there soon will be more technological advancement and invention than there was during the Internet era. That will help drive business growth, he said.
Buffett appeared via video link, but both Ballmer and Immelt were there in person. For those of you not familiar with Butte, it is quite depressed economically (something that you’ll quickly see just by driving around town a little bit) and home to the Berkeley Pit, what was once the largest truck-operated open pit copper mine in the U.S. that is situated, basically, right in town and now operating as a tourist attraction.
The Census Bureau reported that retail sales in the U.S. rose more than expected in August, the biggest gain in five months, due largely to higher sales of gasoline and food.
Retail sales rose 0.4 percent in August after a gain of 0.3 percent in July, the latest figure topping expectations for a 0.3 percent increase. Excluding automobile sales, the main factor in July’s overall gain, sales were up 0.6 percent in August, also better than expected.
MUST READS
IMF fears ’social explosion’ from world jobs crisis – Telegraph
Beware starting trade war, China economist tells U.S. – Reuters
Scientists Discover Thick Layer of Oil on Gulf Sea Floor – Probublica
BofA May Owe $20 Billion in Mortgage Buybacks, Insurers Say – Bloomberg
Jobless strain Social Security’s disability benefits program – Washington Post
Wen Says China’s Economy in `Good Shape,’ Cautions on Property – Bloomberg
U.S. posts $90.53 billion budget deficit in August – Reuters
Union Battle in California Threatens S.E.I.U. – NY Times
Does spending create prosperity? – Cafe Hayek
On More Stimulus Spending – Ron Paul
MARKETS/INVESTING
Oil hovers above $77 amid US pipeline leaks – AP
Gold futures rise to trade above $1,250 – MarketWatch
For the Bad News Bulls, Adversity Is Opportunity – NY Times
China stockpiles Gold while India hogs limelight – Commodity Online
Impact of investment banks closing proprietary trading desks – Commodity Online
“And a partridge in a ‘pair’ tree” – Saut, Raymond James
AP-CNBC Poll: Investors wary of stock trading – Times
Read this before you buy silver – StockHouse
ECONOMY/WORLD/HOUSING/BANKING
Are poll workers being used to inflate jobs totals? – NY Post
Buffett, Ballmer predict bright economic future – Washington Post
U.K. Inflation Unexpectedly Exceeds 3% on Air Fares, Food – Bloomberg
House price falls predicted as first-time buyers stay away – Guardian
German Investor Confidence Fell to 19-Month Low in September – Bloomberg
Washington D.C. housing market in recovery mode: MRIS/Delta – REO Insider
Home Prices Set To Fall Further: Richard Fairbank, Capital One CEO – HuffPost
Bernanke 2011 Outlook May Swing Fed Decision on Bond Purchases – Bloomberg
More banks missing TARP dividend payments – Washington Post
White House Mulls Interim Chief at Consumer Agency – WSJ
What Basel means for banks – Telegraph
By Tim Iacono, Since 2005
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