blog.hsh.com

Sometimes there are so many good topics out there to write about that we just don’t have time to cover them all in depth. In the same vein as our weekly recap, I wanted to touch on several interesting topics that have been both relevant and interesting this week.

J.P. Morgan Earns More than Expected in Fourth Quarter of ‘09: Hey, at least they’ll have money to pay the new “financial crisis responsibility fee.” J.P. Chief Executive Jamie Dimon’s not-so-optimistic comments note some of their struggles that lay ahead:

“TARP will live on for years.”
-Elizabeth Warren

President Obama announced a plan today that will tax the nation’s largest banks, financial firms, and insurers in order to recoup costs associated with the now expired TARP. Oddly, U.S. automakers have been omitted from paying the tax (can’t say we didn’t warn you).

As it stands now, the 10 largest institutions in the U.S. will have to pay 60% of the tax’s total cost. TARP losses are currently estimated to be roughly $117 billion. According to the Wall Street Journal, “…the tax will stay in place until all of the costs are recaptured.” Here are the tax’s specific details:

Think your paycheck is for your eyes only? Think again. Americans are surrendering over more and more of their personal information with each passing day — and your paycheck is the latest bit of personal data that’s now out in the open.

The final rules issued by the Federal Reserve under the CARD Act will now require credit-card companies to examine your income when you apply for credit as a means of determining your ability to make payments. The examination of your income, among other factors, can be used to determine whether or not your application is approved, the size of your credit limit, and/or whether you may be pre-approved for certain offers:

We’ve been following developments in the mortgage insurance (MI) industry for a while now, documenting the reasons why the industry has practically disappeared from the marketplace, questioning why it wasn’t being assisted to a greater degree by the government, and declaring that mortgage credit conditions won’t improve without the resurrection of MI.

About four months ago we, along with National Mortgage News (NMN), thought that billionaire investor Wilbur Ross’s interest in United Guaranty Inc (UGI) was a sign that, among other things, the private market was once again gaining an interest in the mortgage market.

Mortgage rates stabilized last week, ending their multiple-week run of increases, according to the latest issue of HSH’s Market Trends Newsletter (emphasis added):

The turn of the calendar put an end to a weeks-long rise in mortgage rates. As the holiday period falls behind us and we return to more normal market activity, it’s not unusual to see a change in direction for mortgage rates.

Read the rest of this entry »

We published some very informative and speculative posts this week.

What’s behind Fannie and Freddie’s unlimited funding?  

Can I get a tax break on my “green” home improvements?

Whether you’re interested in energy-efficient mortgages or where mortgage rates will end up in 2010, this week’s posts have something for you.

It’s easy to look at December’s jobless numbers and get down about the fact that 85,000 jobs were lost following November’s positive revision which found that 4,000 jobs were created, rather than the loss of the 11,000 as initially reported. It’s important that we remember to focus on the overall trend.

When you review the payroll changes over the last year, the number of jobs lost has continually improved: 584,000 jobs were lost in November of 2008, 463,000 in June of 2009, and “only” 85,000 last month.

We’ve been keeping a close eye on the whole “Fannie and Freddie receive unlimited funding” thing since we first found out about it. As soon as we heard the news we knew there was more to Washington’s motive of providing the GSEs with unlimited funding than merely a way to calm the markets.

On Monday we updated our original post on the subject, adding the opinion of one former Treasury official (which coincided with ours) that the reason Fannie and Freddie were given the unlimited credit line was because in the near future their losses would add up to more than the $200 billion each were previously given.

We couldn’t agree more with John Canally, an economist at LPL Financial, when he said that the Fed is walking a pretty narrow tightrope in 2010.

The Fed’s decision to purchase Fannie and Freddie mortgage-backed securities (MBS) has been extremely successful at lowering conforming mortgage rates to 50-year lows, and driving potential buyers into the market.

But what makes the Fed’s tightrope especially narrow in 2010 is that the program is due to expire in the next few months — and there’s dissension in the Federal ranks over whether or not to extend it.

It seems as though almost the entire nation is caught in the grasp of Old Man Winter. When temperatures in Florida dip into the 30’s you know it’s trouble for lots of folks. Here in the North East, 20 degree temps and howling winds are becoming uncomfortably normal.

With speculation that this winter could be the worst in 25 years, it’s the perfect time to consider making some home improvements that can help to keep your energy bill from soaring through the roof. Whether you’re buying a new home, or looking to retrofit your existing dwelling, there are several energy-efficient options that can both lower your energy bills and get you a tax credit at the same time.