http://mikecopass.comThe Crisis of Confidence Facing the Markets [FOX 9-27-2011]
Author: admin // Category: subprime mortgage
The subprime mortgage crisis reached a critical stage during the first week of September 2008, characterized by severely contracted liquidity in the global credit markets and insolvency threats to investment banks and other institutions. The United States director of the Federal Housing Finance Agency (FHFA), James B. Lockhart III, on September 7, 2008 announced his decision to place two United States government-sponsored enterprises (GSEs), Fannie Mae (Federal National Mortgage Association) and Freddie Mac (Federal Home Loan Mortgage Corporation), into conservatorship run by FHFA. United States Treasury Secretary Henry Paulson, at the same press conference stated that placing the two GSEs into conservatorship was a decision he fully supported, and said that he advised ‘that conservatorship was the only form in which I would commit taxpayer money to the GSEs.’ He further said that ‘I attribute the need for today’s action primarily to the inherent conflict and flawed business model embedded in the GSE structure, and to the ongoing housing correction.’ The same day, Federal Reserve Bank Chairman Ben Bernanke stated in support: ‘I strongly endorse both the decision by FHFA Director Lockhart to place Fannie Mae and Freddie Mac into conservatorship and the actions taken by Treasury Secretary Paulson to ensure the financial soundness of those two companies.’
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Duration : 0:4:23
“As we gather together in solidarity to express a feeling of mass injustice, we must not lose sight of what brought us together. We write so that all people who feel wronged by the corporate forces of the world can know that we are your allies.
As one people, united, we acknowledge the reality: that the future of the human race requires the cooperation of its members; that our system must protect our rights, and upon corruption of that system, it is up to the individuals to protect their own rights, and those of their neighbors; that a democratic government derives its just power from the people, but corporations do not seek consent to extract wealth from the people and the Earth; and that no true democracy is attainable when the process is determined by economic power. We come to you at a time when corporations, which place profit over people, self-interest over justice, and oppression over equality, run our governments. We have peaceably assembled here, as is our right, to let these facts be known…”
Duration : 0:28:57
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The Global Financial Crisis (GFC) started three years ago,
but China seems to be immune to it.
Under the tightening monetary policy,
many of enterprises are turning into shadow banks.
With the due date of loan sharking approaching,
the economic claps occur continuously.
Foreign media warned that the Chinese version
of the Subprime Mortgage Crash is approaching.
After the start of the GFC in 2008,
China began changing its monetary policy.
For small and medium size firms its difficult
to access the formal banking sector.
Instead, they loan money from shadow lenders
who are actually state companies.
The official sector can obtain money from state-owned banks
and issue loans to other borrowers with higher interest rates.
In addition, non state-owned shadow banks are expanding,
and more problems are being exposed.
Economists are worried that China is starting to follow
the pattern of the U.S.’ Subprime Mortgage Crash.
During the World Economic Forum held in Dalian last week,
a former vice chairman of NPC, Cheng Siwei said:
“China’s Subprime Mortgage Crash is the lending of money
to local governments which have no ability to repay them.”
It is estimated that 80% of the loans from the top four banks
in China go to state-owned firms.
But now China has different shadow banks, from state-owned
to individuals’ firm, most of them with officials’ background.
Local governments use state funds to invest in businesses,
and the funds are estimated to be ca. $1.7 trillion.
These shadow banks are outside the banking and financial
sectors and are thus less regulated or not regulated at all.
Economist Cao An thinks that the state-owned firms
have the advantage of funds.
They can lend the money through guarantee companies
or other platforms.
In this lack of credit system, once the problem is exposed,
it will be worse than what happened in the U.S.
Cao An: “The economic trend is at a low point,
small or medium-sized firms need plenty of funds.
But even with the loans it is difficult for them to make
60-100% profit and service the loan; this is a risk for lenders.
Therefore if the borrowers fail to service and repay the loans,
this will become a bad debt.”
China added new loans, adjusted to its GDP. They went up
to 200%, from 100% prior to Lehman Brothers’ collapse.
Subsequently, the bad debt rate raised
from 1% in the first half of 2010 to 4.9% in 2011.
Chen Zhifei, Economy Professor, New York City University,
points out experts’ analysis,
which shows 2011 as the most difficult year for China
since China’s open market economy had started.
According to a survey done by the Industrial Federation,
90% of the firms in China don’t get a penny from the banks,
and 95% of the private firms don’t get loans from banks
either, showing that funds allocation is not sound.
Chen Zhifei: “China’s fund distribution is for state-owned
enterprises, This policy exists for 10 to 20 years now.
After the GFC started, China had loaned
RMB 4 trillion for investments.
If these investments’ loans do not get repaid, they will turn
into bad debts and the country’s economy will collapse.”
Beijing economist Mao Yushi points out that although
the top four banks in China are controlled by the government, the accumulation of bad debts still occurs
Mao Yushi: “The companies borrow money from the banks
and lend them as high interest rate loans.
The problem is due to lack of interest rates’ market regulation.
It’s bureaucratic as it’s the privileged who can borrow money.
Most of the people can only borrow high interest rate loans,
this is the reason why the problem exists for so long.”
Mao Yushi thinks that the solution to these problems
is to open small and medium-sized banks,
and let people establish such banks as well,
not only the government.
NTD reporters Liang Xi, Li Ting and Wang Mingyu.
《神韵》2011世界巡演新亮点
http://www.ShenYunPerformingArts.org/
Duration : 0:3:54
SunwestTrust.com: Friends and Family Loan Mortgage Program : Social Personal Peer Lending
Author: admin // Category: mortgage loan
http://www.SunwestTrust.com – 800-642-7167. You probably have heard about the national credit crisis. During this time of national crisis have you ever considered becoming a bank? That’s right; you can become a bank for a friend or family member.
Duration : 0:2:41
Sept. 2 (Bloomberg) — Paul Miller, managing director at FBR Capital Markets Corp., talks about a potential lawsuit by the U.S. Federal Housing Finance Agency against Bank of America Corp. and other lenders over faulty mortgage loans.
Miller speaks with Adam Johnson on Bloomberg Television’s “Fast Forward.” (Source: Bloomberg)
Duration : 0:4:25
The EU has called for the President of the European Central Bank, among other officials, to stand before a special financial committee, as the debt plague sweeping the bloc threatens its very unity. Talks, which are underway, focus on halting the spread of contagion, as fresh data sows panic with revelations even such economic giants as Germany are not immune. Another priority is addressing investor concerns that Finland’s demands for collateral, could derail a second 160 billion euro bailout for Greece. Patrick Young, Executive Director of the investment firm DV advisors, believes the rifts between the EU nations make it impossible to offer a meaningful solution to the crisis.
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Duration : 0:5:42
Documentary is wholly owned by the BBC.
“What Happens After Sorry.” In 2009 RBS announced the biggest losses in British corporate history. The bankers responsible, including former RBS chief Fred Goodwin, (aka Fred the Shred) apologised publicly for their parts in the banking crisis.
From the RBS workers facing job cuts (announced just hours after the apologies), to the shareholders who have lost their life savings and the taxpayers whose money is now riding on the bank’s recovery, Panorama asks the question, “What happens after sorry?” Reporting from Mark Daly.
Duration : 0:14:2
Documentary is wholly owned by the BBC.
“What Happens After Sorry.” In 2009 RBS announced the biggest losses in British corporate history. The bankers responsible, including former RBS chief Fred Goodwin, (aka Fred the Shred) apologised publicly for their parts in the banking crisis.
From the RBS workers facing job cuts (announced just hours after the apologies), to the shareholders who have lost their life savings and the taxpayers whose money is now riding on the bank’s recovery, Panorama asks the question, “What happens after sorry?” Reporting from Mark Daly.
Duration : 0:15:0
HUD GIVING $50,000 TO HOMEOWNERS BEHIND ON MORTGAGE 7-5-2011
Author: admin // Category: first mortgage
The Emergency Homeowners Loan Program will offer a zero interest, forgivable bridge loan to homeowners who have experienced a substantial loss of income (a reduction of at least 15%) due to unemployment or underemployment caused by adverse economic conditions or medical condition. Approved homeowners are eligible to receive one-time EHLP assistance to pay certain arrearages to bring them current, as well as ongoing monthly assistance to help them to make their monthly first lien mortgage payments (including payments of principal, interest, taxes, and insurances). Assistance is limited to a maximum duration of 24 months, or up to a maximum loan amount of $50,000 in mortgage payment assistance, whichever occurs first. The EHLP loan is secured by a junior lien against the approved homeowner’s principal residence and is forgivable over a 5-year principal reduction period.
For homeowners–making mortgage payments is a must to keep your house, but if you’re in danger of foreclosure, a new federal program could help. It’s called the Emergency Homeowners Loan Program (EHLP), and it could be the extra push that people need to prevent foreclosure.
Duration : 0:1:59