2011 December 28 | timiacono.com

Occupy the Federal Reserve?

According to this item at Occupy Wall Street News, the African-American faith community will join forces with Occupy Wall Street to protest economic injustice on Martin Luther King Day next month and they intend to “Occupy the Federal Reserve” in up to twelve cities across the country where regional central bank offices are located.

There’s more than a little bit of irony in the event also being referred to as “Occupy the Dream”, that is, just two years in advance of the 100-year anniversary of the founding of the Fed, what, to the biggest of the banks back then was a “dream” of a monopoly over the industry at a time when smaller regional banks were rapidly gaining market share.

So far, it’s worked out pretty well for them, if not for the rest of us.

Living Free for Years

A week or two ago it was learned that it takes nearly 1,000 days for a distressed property to wind its way through the foreclosure process in New York and New Jersey and, the assumption at the time was that these were extreme outliers … apparently not.

A CNN/Money report today indicates that in some areas it takes even longer and that the average duration is much higher than I would have guessed.

Nationwide, the average time it takes to process a foreclosure — from the first missed payment to the final foreclosure auction — has climbed to 674 days from 253 days just four years ago, according to LPS Applied Analytics.

It takes much longer than that in Florida, where the process averages 1,027 days, nearly 3 years. In D.C., foreclosure averages 1,053 days and delinquent borrowers in New York often stay in their homes for an average of 906 days.

And while some borrowers are looking for ways to make good with lenders and get their homes back, many aren’t paying a dime. Nearly 40% of homeowners in default have not made a payment in at least two years, according to LPS.

Many of these homeowners are staying in their homes based on a technicality. There is rarely any dispute over whether or not they have stopped paying their mortgage, said David Dunn, a partner at law firm Hogan Lovells in New York, who represents banks and other financial institutions in foreclosure cases.

“In my experience, they never say, ‘I’m not delinquent’ or ‘I want to pay my bill but I’m confused over who to send it to,’ or ‘Oh my God, you mean I didn’t pay my mortgage?’ They’re not in technical default. They’re in default because they’re not paying,” he said.

The robo-signing debacle seems to have been a major factor in extending how long it takes to foreclose on a property and a thousand dollars spent on an attorney appears to be worth many times that amount in mortgage/rent payments that never have to be made.

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Home Price Declines Over the Years

Following yesterday’s Case-Shiller report on falling home prices, Zillow provided their take on where property values have been heading in this story that included the sobering chart below, little comfort being provided in the fact that home value declines are slowing.

Of course, it would likely be a very different situation if mortgage rates weren’t at freakishly low levels and the backlog of millions of distressed properties moved a little quicker through the foreclosure process, but, that’s what passes for banking policy in the aftermath of the greatest financial bubble that no one saw coming.

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Wednesday Morning Links

MUST READS
Italy borrowing costs fall sharply at auction – BBC
Banks Bunker Hundreds of Billions in Deposits at ECB – Spiegel
Obama seeks $1.2 trillion debt ceiling increase – CNN/Money
The Wealth Gap Between Congress and Voters Is Growing – Atlantic
Middle-aged borrowers piling on student debt – Reuters
Shoppers return to credit to pay for holidays – Washington Post
Delayed Gratification – Surowiecki, New Yorker
Midlife Crisis Economics – Brooks, NY Times
Brooks Projects His Self Indulgence – Baker, CEPR
Predictions For 2012 – Decline of the Empire
Breaking Out the 0.1% – EconomPicDatag
Occupy the Federal Reserve – OWS News

MARKETS/INVESTING
Oil near $101 amid Iran tensions – AP
Gold dips on Iran, euro zone worries – Reuters
The oil markets and Iran in 2012 – MarketWatch
Rising Geopolitical Tensions Threaten Oil Supplies – CNBC
Calgary Oil Makes Canada Energy Superpower – Bloomberg
Bonds About To Plunge? Implications For Stocks and PM’s – Profitimes
One reason why gold is just consolidating – Commodity Online
Nation urged to increase holdings of gold – China Daily
Time to make a strategic allocation to gold – Commodity Online
Lampert’s Hit-or-Miss Portfolio – DealBook

ECONOMY/WORLD/HOUSING/BANKING
The Biggest Cut in Unemployment Benefits – NY Times
Modern Monetary Theory and Austrian Economics – NetNet
Consumer confidence up, nearing post-recession high – LA Times
UK jobs outlook is the ‘worst for 20 years’ – Telegraph
BRIC Decade Ends as Growth Peaked, Record Outflows – Bloomberg
U.S. Declines to Say China Is Manipulator in Yuan ‘Quarrel’ – BusinessWeek
Irish May Pay Greek Price for T-Bill Return – Bloomberg
A Look at Case-Shiller by Metro Area – WSJ
Foreclosure free ride: 3 years, no payments – CNN/Money
Bernanke Drive for Openness May Include More Briefings – Bloomberg
Why Is The Term “Financial Repression” Being Sold? – Naked Capitalism
How Banks Cheat Taxpayers – Taibblog

 
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