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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: mishedlo who wrote (67936)	8/22/2007 12:41:13 PM
From: Bucky Katt	Read Replies (1) \| Respond to of 116555

I've been sniffing around the retail sector, looking for the overpriced stocks that will fall on their faces during the Xmas shopping season. It could be a bit more than just a 'rough patch' for many of them. Much depends on what the FED decides to do or not do. We are in a real mess. Now I read that many people who are in the repo system with their home mortgages were also blindsided by rising property taxes, and rising utility bills. Welcome to reality. What do they teach in school these days? They can puff up the so called leading indicators all they want, the reality is this> "It's no secret that many customers are running out of money at the end of the month. The paycheck cycle is more paramount than it ever has been." Lee Scott, WALMART ceo

To: mishedlo who wrote (67936)	8/22/2007 2:00:52 PM
From: Bucky Katt	Respond to of 116555

U.S. banks and thrifts suffered the biggest increase in late loan payments in 17 years as more homeowners fell behind on mortgages, the Federal Deposit Insurance Corp. said. Loans more than 90 days past due rose 10.6 percent to $66.9 billion in the period ending June 30, the largest quarterly rise since 1990, the FDIC said in its Quarterly Banking Profile released today. ``The bottom line for banks is that the credit environment continues to be more challenging now than it has been in recent years,'' FDIC Chairman Sheila Bair said during a news briefing at the agency's Washington headquarters. The report reflects the growing strain lenders are facing as the collapse of the subprime mortgage market roils the banking industry. At least 90 U.S. mortgage companies have halted operations or sought buyers since the start of 2006, according to Bloomberg data. Loans more than 90 days past due grew 36.2 percent from $49.1 billion in the second quarter a year ago, the largest 12- month increase since 1991. Residential mortgage loans 90 days delinquent increased 12.6 percent to $27.5 billion in the second quarter from $24.4 billion in the first quarter. ``Current conditions do underscore that regulators must be vigilant and banks need to follow sound risk-management practices,'' Bair said. Still, she said, the banking industry is well-capitalized, profitable, well-diversified and ``in a very good position as we are going through this period of market readjustment.'' Loss Provisions Rise Lenders set aside $11.4 billion for potential loan losses in the second quarter, up 75 percent from a year earlier and the most since the fourth quarter of 2002. The amount lenders wrote off for bad loans grew 51.2 percent to $9.16 billion in the second quarter from $6.06 billion in the second quarter of 2006. Insured banks and thrifts reported $36.7 billion in net income for the quarter, a decline of 3.4 percent from $38 billion a year ago. The FDIC insures deposits at 8,615 institutions with $12.3 trillion in assets. bloomberg.com

To: mishedlo who wrote (67936)	8/22/2007 3:34:11 PM
From: Bucky Katt	Read Replies (2) \| Respond to of 116555

Lehman Shuts Subprime Unit; 1200 Jobs Cut at 23 offices. (do these cuts ever show up in the unemployment index?) Lehman Brothers Holdings Inc. is closing its "subprime" mortgage business because of the tumult in the home lending industry, the bank said Wednesday. The Wall Street brokerage said it is shuttering its BNC Mortgage LLC subsidiary, which issues home loans to people who cannot document their income or have shaky credit histories. Closing this business will cost $25 million in severance pay and real estate and technology costs. Lehman Brothers will also record a $27 million accounting charge for writing down goodwill, or the value of the Irvine, Calif.-based business that Lehman carried on its books above the worth of the physical assets. Lehman Brothers will continue to issue home loans through its Aurora Loan Services LLC unit. Mortgage lenders around the nation, especially subprime lenders, have been closing down in the past month as deteriorating credit quality has drained the cash available to the industry. Shares of Lehman Brothers rose 50 cents. Natch...