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To: James Strauss who wrote (12486)	6/21/2003 12:01:25 PM
From: James Strauss	Read Replies (1) \| Respond to of 13094

NDX Looks Ready To Correct... ********************************* bigcharts.marketwatch.com MACD and Stochastics suggest further downside... The FED meets next week... A 1/2 point cut would suggest greater weakness in the economy... I think this would overshadow the long liquidity argument... A 1/4 point cut would be more positive for the market if it's accompanied by a positive statement by the FED looking forward sprinkled with a little caution for the present... Jim

To: James Strauss who wrote (12486)	6/23/2003 10:24:01 AM
From: Bucky Katt	Read Replies (1) \| Respond to of 13094

Jim, new stats indicate mortgage foreclosures are up to a record rate (1.2%) whilst mortgage delinquencies are down a bit... Funny, when things are so good with low rates and all, and foreclosures are breaking records.. Must be a lesson in there somewhere? ____________________ Mortgage Data Paint a Mixed Picture, But Credit Problems Continue to Grow By PATRICK BARTA Staff Reporter of THE WALL STREET JOURNAL The percentage of Americans who were delinquent in making mortgage payments declined for the second quarter in a row at the end of 2002. But that positive development was offset by rising foreclosures and evidence that credit problems are growing in places hardest hit by the manufacturing downturn, especially the Midwest and the Southeast. In its latest reading on mortgage credit quality, the Mortgage Bankers Association of America said the percentage of mortgage loans past due fell to a seasonally adjusted 4.53% in the fourth quarter compared with 4.66% in the third quarter and 4.67% in the year-earlier fourth quarter. While the latest reading is an improvement, the delinquency rate remains well above its recent low of 3.75% in the first quarter of 2000. Meanwhile, the percentage of loans in the foreclosure process rose to a record high 1.18% from 1.15% in the third quarter. Economists are divided over how to read the trends. Some economists view the delinquency data as a better indication of recent credit trends because it represents recent activity. It usually takes months or more for delinquent loans to wind up in foreclosure, meaning that the foreclosure rate includes many borrowers who got into credit trouble much earlier. The percentage of loans that started the foreclosure process in the quarter, meanwhile, dropped slightly, to 0.35% from 0.37% in the previous quarter. "Foreclosures may be peaking," said Doug Duncan, the association's chief economist. Other economists, however, were less optimistic. The economy appears to have stumbled since the end of 2002, suggesting that delinquencies could trend upward again as the labor market stagnates and personal bankruptcies continue to run at record levels. Moreover, it is possible that the delinquency numbers may have been skewed downward by the large surge in new mortgages originated during the past several years. New mortgages tend to have lower delinquency rates than older mortgages, so as more "young" loans enter lenders' pools, they could drive down the overall delinquency rate even if the underlying quality of those loans isn't good. "It means a year or two out we could see surprising increases" in delinquency rates as the newer loans age, says Michael Youngblood, director of research at GMAC RFC Securities in Bethesda, Md., a unit of General Motors Corp. A recent report by GMAC RFC found unusually high rates of seriously delinquent loans in 39 out of 331 metropolitan areas, including numerous cities in industrial states such as Ohio, Indiana, North Carolina, Arkansas and upstate New York. Delinquencies also are high in Utah, which is suffering from a post-Olympics downturn. In Gary, Ind., Cleveland, Ohio and Greenville, S.C., 19% or more of subprime loans are more than 90 days delinquent. In Salt Lake City, the rate is about 17%. Problems are also evident in some cities for prime loans: In Elmira, N.Y., near the corporate headquarters of Corning Inc., nearly 16% of prime mortgages are seriously delinquent. Industrial cities show weaker credit performance in part because the manufacturing sector has lost more jobs during the latest economic downturn than any other sector. Also, home prices have risen much less rapidly in the Midwest and in some other industrial areas than on either of the two coasts. Rising home prices make it easier for property owners to avoid foreclosure, either by selling their homes to pay off their mortgages or by refinancing to reduce their monthly debt burdens.