February 2010

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Banks Out of the Woods? Maybe Not

Submitted by jbonica on Sun, 02/28/2010 - 14:12

Bubblenomics

By FLOYD NORRIS

MORE than $1 in every $10 that American banks have outstanding in loans is lent to a troubled borrower, a ratio far higher than previously seen in the quarter-century that such numbers have been compiled.

The problems are greatest in construction loans for single-family homes, where nearly 40 percent of the loans either are delinquent or have been written off as uncollectible. But they are also high in mortgage loans for single-family homes, where $1 in every $8 of loans is troubled.

Under Fire, Bernanke Makes Case for Broad Fed Powers

Submitted by jbonica on Sun, 02/28/2010 - 14:04

Bubblenomics

By Cheyenne Hopkins, American Banker

WASHINGTON — A day after the release of regulatory data that showed the worst decline in lending in 67 years, lawmakers pressed Federal Reserve Board Chairman Ben Bernanke Wednesday on what he and the other agencies were doing to reverse the trend.

While defending the central bank's response, Bernanke also sought to turn it to his political advantage, arguing it is another reason why the Fed must retain its bank supervisory powers.

Bernanke's Q&A to House Financial Services panel

Submitted by jbonica on Sun, 02/28/2010 - 13:59

Bubblenomics

WASHINGTON (Reuters) - The following are highlights at the question and answer session of a House Financial Services Committee hearing on Wednesday with Federal Reserve Chairman Ben Bernanke testifying on the central bank's economic and monetary policy outlook.

Barack Obama

BERNANKE ON GLOBAL ECONOMY HEART ATTACK

"In the fall of 2008, the world economy essentially had a heart attack and the firms started dropping employment, employees very quickly. There was a sharp contraction in global trade. A sharp contraction in economic activity.

Dodd: What’s the Fed Doing about Commercial Real Estate Mess?

Submitted by jbonica on Sun, 02/28/2010 - 13:54

Bubblenomics

By Tiernan Ray
Remember the TARP Oversight Committee’s warning about the looming mass of foreclosures in commercial real estate? The $1.5 trillion of loans coming due the next three years?

Well, Democratic Senator Christopher Dodd of Connecticut wants some answers about all that, according to a note he sent this afternoon to Federal Reserve Chairman Ben Bernanke and provided to Stocks to Watch.

Commercial Real Estate Losses and the Risk to Financial Stability

Submitted by jbonica on Sun, 02/28/2010 - 13:51

Bubblenomics

Commercial Real Estate Losses and the Risk to Financial Stability
Source: Congressional Oversight Panel

Commercial Real Estate: The Next Real Estate Bubble

Submitted by jbonica on Sun, 02/28/2010 - 13:37

Bubblenomics

By Leigh Ann Caldwell

In cities and towns across the country, the number of empty store fronts and office buildings is growing. For example, office vacancy rates have risen to 16.3 percent and are expected to rise to 17.4 percent by the end of the year, according to the National Association of Realtors.

Federal regulators and industry analysts are sounding the alarm. Reasons all point back to a struggling economy.

Real estate values plunge again

Submitted by jbonica on Sun, 02/28/2010 - 13:24

Bubblenomics

By GARY PINNELL

SEBRING - That clunk on the floor was the sound of the other shoe dropping.

For the past three years, residential real estate values have been declining, said Property Appraiser Raymond McIntyre. This year, he expects commercial property and unimproved land prices will fall as well.

"We're going to be down 10 or 12 percent," McIntyre said Tuesday. "That's a projection, of course."

In real dollars, said Budget Manager Tim Mechling, that's about $4 million. The number may grow larger when other revenue sources are added, like sales and gasoline taxes.

Realtors give commercial real estate outlook

Submitted by jbonica on Sun, 02/28/2010 - 13:08

Bubblenomics

WASHINGTON -- The commercial real estate market is not expected to recover this year, with vacancy rates set to rise and rents forecast to fall, the National Association of Realtors said Tuesday.

No meaningful recovery is expected to come before 2011, as concerns about unemployment, consumer confidence and other economic conditions persist, the realtors group said.

Morgan Stanley’s Klopp May Expand Investing in Property Debt

Submitted by jbonica on Sun, 02/28/2010 - 12:59

Bubblenomics

By Brian Louis

Feb. 24 (Bloomberg) -- Morgan Stanley’s John Klopp taught commercial property financing a decade before Wall Street tied its fortunes to mortgage securities.

Klopp, who took over as Morgan Stanley’s head of investing in Americas real estate and global property debt Feb. 1, introduced Columbia University students to hedging risk and using short-term debt to finance commercial property deals as early as 1991.

US Sen Dodd urges action on commercial real estate

Submitted by jbonica on Sun, 02/28/2010 - 12:44

Bubblenomics

By Kevin Drawbaugh and Corbett B. Daly

WASHINGTON, Feb 22 (Reuters) - U.S. Senate Banking Committee Chairman Christopher Dodd, citing concerns about the outlook for commercial real estate, asked regulators on Monday for action and a report on efforts to stabilize the sector.

"The weakness in the (commercial real estate) market requires prompt and robust responses from the regulators to guard against harmful effects on financial institutions and the economy," Dodd said in a statement.

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