Archive for December 26th, 2007
Posted by: in Housing
Filed under: Books, Housing
 In the months and years to come, dozens of books will chronicle the subprime lending boom and bust that resulted in record numbers of foreclosures and huge losses at some of America’s most prominent banks (as well as the dismissal of Merrill Lynch CEO Stan O’Neal and his 9-figure parting gift, but that’s another story).
But for now, there are only really a handful, and Pittsburgh reporter Richard Lord’s American Nightmare: Predatory Lending and the Foreclosure of the American Dream is one of the ideal. Based on interviews with dozens of ripped-off subprime borrowers, contractors, mortgage brokers, and bankers, Lord presents a disturbing tale of the wild west of the housing market: Usurious interest rates are charged to borrowers who could have qualified for lower interest conforming loans, terms are changed at closing, and predatory balloon payment and prepayment penalties are imposed on consumers who lack the sophistication to know what they’re doing.
Lord also discusses the collateralized debt obligations that the loans were bundled into, and how the securitization of mortgages left brokers with tiny incentive to give people loans that they could, for instance, afford to pay off. Lord doesn’t quite predict the subprime meltdown that would result in big writedowns at almost all the huge banks (This book was published in 2005), but he comes close.
If you want to comprehend the darkest side of the subprime lending industry, Lord’s book is definitely worth a look until superior, more updated stuff comes out.
Share This
Share This
 No Comments »
Posted by: in Housing
Filed under: Newsletters, Stocks to Buy, Housing, Best Stocks for 2008
For 25 years, Steven Halpern, editor of TheStockAdvisors.com, has surveyed the leading financial newsletter advisors asking for their favorite stocks for the coming year. This article is one of 100+ ideas in the Ideal Stocks for 2008 report.
“My favorite picks for 2008 are two monoline bond insurers: MBIA Inc. (NYSE: MBI) and AMBAC (NYSE: ABK),” says Richard Lehmann, editor of The Forbes Lehmann Income Securities Investor.
“These two companies have been heavily shorted by speculators because of their exposure to subprime mortgage defaults. At current pricing, they’re selling at half book value and only three times earnings.
“The reason for current concern is that they’ll lose their AAA credit enhancement ratings and therefore their ability to conduct new business, something I don’t think is likely because there are various remedies to forestall such an event.
“For 2008, the demand for their services should grow substantially since the reliance by lenders on credit ratings alone has been seriously eroded. Also, their insurance of CMOs and CDOs only protect the most senior tier of a multi-tiered debt instrument, so their loss exposure is very marginal and years off.
“Actually, their main business is insuring municipal bonds and this business has been unaffected by the subprime mess. In addition, they receive all their premium income up front even on a 30-year bond issue and that income is pro-rated over those years.
“As a result, half of their revenues for the next five years have already been collected and are earning them income. Now that’s the kind of business Warren Buffett loves!”
Share This
Share This
No Comments »
Posted by: in Housing
Filed under: Books, Housing
In the months and years to come, dozens of books will chronicle the subprime lending boom and bust that resulted in record numbers of foreclosures and huge losses at some of America’s most prominent banks (as well as the dismissal of Merrill Lynch CEO Stan O’Neal and his 9-figure parting gift, but that’s another story).
But for now, there are only really a handful, and Pittsburgh reporter Richard Lord’s American Nightmare: Predatory Lending and the Foreclosure of the American Dream is one of the ideal. Based on interviews with dozens of ripped-off subprime borrowers, contractors, mortgage brokers, and bankers, Lord presents a disturbing tale of the wild west of the housing market: Usurious interest rates are charged to borrowers who could have qualified for lower interest conforming loans, terms are changed at closing, and predatory balloon payment and prepayment penalties are imposed on consumers who lack the sophistication to know what they’re doing.
Lord also discusses the collateralized debt obligations that the loans were bundled into, and how the securitization of mortgages left brokers with little incentive to give people loans that they could, for instance, afford to pay off. Lord doesn’t quite predict the subprime meltdown that would result in huge writedowns at almost all the huge banks (This book was published in 2005), but he comes close.
If you want to understand the darkest side of the subprime lending industry, Lord’s book is definitely worth a look until better, more updated stuff comes out.
Share This
Share This
No Comments »
Posted by: in Housing
Filed under: Newsletters, Stocks to Buy, Housing, Ideal Stocks for 2008
For 25 years, Steven Halpern, editor of TheStockAdvisors.com, has surveyed the leading financial newsletter advisors asking for their favorite stocks for the coming year. This article is one of 100+ ideas in the Ideal Stocks for 2008 report.
“My favorite picks for 2008 are two monoline bond insurers: MBIA Inc. (NYSE: MBI) and AMBAC (NYSE: ABK),” states Richard Lehmann, editor of The Forbes Lehmann Income Securities Investor.
“These two companies have been heavily shorted by speculators because of their exposure to subprime mortgage defaults. At current pricing, they’re selling at half book value and only three times earnings.
“The reason for current concern is that they will lose their AAA credit enhancement ratings and therefore their capability to conduct new business, something I don’t think is likely because there are various remedies to forestall such an event.
“For 2008, the demand for their services should grow substantially since the reliance by lenders on credit ratings alone has been seriously eroded. Also, their insurance of CMOs and CDOs only protect the most senior tier of a multi-tiered debt instrument, so their loss exposure is very marginal and years off.
“Actually, their main business is insuring municipal bonds and this business has been unaffected by the subprime mess. In addition, they receive all their premium income up front even on a 30-year bond issue and that income is pro-rated over those years.
“As a result, half of their revenues for the next five years have already been collected and are earning them income. Now that’s the kind of business Warren Buffett loves!”
Share This
Share This
No Comments »
Posted by: in Housing
Filed under: Bad news, Economic data, Housing
Home prices fell 6.1% in the past 12 months — the largest 12-month decline in at least six years, and a sign that the housing market remains in a pronounced slump, research from the S&P/Case-Shiller home price index indicated Wednesday. In the survey, all 20 metropolitan markets surveyed showed year-over-year price declines.
Analyst C. Leonard Bauer, formerly of Prudential, told BloggingStocks on Wednesday that the October 2007 Case-Shiller data confirms some of the worst fears analysts have about the U.S. housing market heading into 2008.
“This is a sobering statistic,” Bauer said. “It confirms a housing market in a deep slump. This is the worst year-over-year decline in prices that I’ve seen nationally, and I’ve been following housing for 20 years. The northeast [U.S.] condo slump in the early 1990s saw larger percentage drops but that was only one section of the market. This is across the board.”
Bauer added that he had expected a year-over-year decline for October 2007 of about 2-4%. Bauer stated he now expects both foreclosures and the backlog of unsold homes to increase in Q1 and Q2 2008.
“The supply of unsold homes nationally is at 9-10 months, depending on the data you look at, and this price decline will cause that backlog to increase, and the number of foreclosures will increase, also,” Bauer said. “Some owners will drop their prices and sell, but many won’t, which will drive the backlog higher. On the refinance front, if we have the ability to get a decent mortgage assistance package out of Congress, that’ll reduce the number of foreclosures some, but they haven’t passed a package yet.”
Earlier this fall, the Bush Administration announced a legislative package aimed at freezing interest rates for some adjustable rate mortgages scheduled to reset in 2008, as well as other programs aimed at lowering the number of foreclosures. Authored by the U.S. Treasury Department, the proposal is expected to be reviewed by both U.S. Home and Senate committees beginning in January 2008.
Share This
Share This
No Comments »
Posted by: admin in Today News
Ex-Oak Lawn cop pleads not guilty to extorting money in traffic stops - Chicago Tribune
|
No Comments »
Filed under: Products and services, Apple Inc (AAPL), Amazon.com (AMZN)
 This past Monday, Amazon.com (NASDAQ: AMZN) was still open for business like it always is. There’s no “shutting down” on the web like there’s in the real, brick-and-mortar shopping world. What on earth was being purchased on Christmas Eve? Not Christmas presents — those are already under the tree. Gifts for other holidays? Possibly — but you better choose “expedited shipping” when checking out.
When it came to Personal computers being sold at Amazon’s website a few days ago, the Apple (NASDAQ: AAPL) MacBook made its mark as the #1 Personal computer seller at the world’s largest online retailer. Not Hewlett-Packard (NYSE: HPQ) — which held the 2nd and 3rd spots — not Dell (NASDAQ: DELL) (which is not sold at Amazon), and not Gateway (now part of Acer). That design iconoclast and superbly-marketed Apple machine was perched at the top. Not the iPod or the iPhone, but the fully-fledged MacBook laptop Computer.
In what could be seen as the real “breakout” year for Apple laptop computers in 2008, Apple’s entry-level MacBook laptop was even priced at $300 and $500 more than the HP systems which were below it in sales. Right now, HP is the world’s largest laptop Personal computer seller, as it’s in most retailer outlets, has a strong web sales presence and has aggressive pricing to boot. Apple’s systems, though, continue to set the standard in cool design and “wow” factor, similar to the iPod and iPhone products that were hot sellers this holiday season. Will the MacBooks stay at the top of Amazon’s Computer sales chart in 2008? Steve Jobs sure hopes so.
Share This
Share This
No Comments »
Filed under: Good news, Products and services, Competitive strategy, Costco Wholesale (COST)
 Although there’s still need for concern about the retail sector, I have to admit that I’m feeling fairly secure right now about Costco Wholesale Corp. (NASDAQ: COST). That is why I see this morning’s 1.25% drop in Costco’s share price as an possible buying opportunity. Already, that share price is being supported and lifted from a low of $69.55 and I’d be willing to speculate that Costco shall end the day in positive territory.
A Wall Street Journal article today puts a shine on Costco’s seasonal performance, indicating that management executed a seasonal plan which worked nicely within the fragility of today’s retail realm. Costco CFO Richard Galanti said Monday, “We were left pretty clean in terms of seasonal markdowns.Generally talking, our season went well.” Costco has already changed over its seasonal square footage to furniture offerings, something it began doing even before the Christmas season grinds to a halt.
The two issues to keep focus on regarding Costco this year is how well it takes advantage of new opportunities and the quality of its management team. Already, five NBA teams have joined with Costco to sell discounted game tickets through Costco’s website, according to SportsBusinessJournal.com.(registration required) This development might prove to be part of a marketing push which will see Costco attempting to sell more non-perishable goods via the World wide web.
Share This
Share This
No Comments »
Filed under: Products and services, Apple Inc (AAPL), Amazon.com (AMZN)
This past Monday, Amazon.com (NASDAQ: AMZN) was still open for business like it always is. There’s no “shutting down” on the internet like there’s in the real, brick-and-mortar shopping world. What on earth was being purchased on Christmas Eve? Not Christmas presents — those are already under the tree. Gifts for other holidays? Possibly — but you better choose “expedited shipping” when checking out.
When it came to Personal computers being sold at Amazon’s website a few days ago, the Apple (NASDAQ: AAPL) MacBook made its mark as the #1 Personal computer seller at the world’s largest on the web retailer. Not Hewlett-Packard (NYSE: HPQ) — which held the 2nd and 3rd spots — not Dell (NASDAQ: DELL) (which is not sold at Amazon), and not Gateway (now part of Acer). That design iconoclast and superbly-marketed Apple machine was perched at the top. Not the iPod or the iPhone, but the fully-fledged MacBook laptop Personal computer.
In what could be seen as the real “breakout” year for Apple laptop personal in 2008, Apple’s entry-level MacBook laptop was even priced at $300 and $500 more than the HP systems which were below it in sales. Right now, HP is the world’s largest laptop Personal computer seller, as it’s in most retailer outlets, has a strong web sales presence and has aggressive pricing to boot. Apple’s systems, though, continue to set the standard in cool design and “wow” factor, similar to the iPod and iPhone products that were hot sellers this holiday season. Will the MacBooks stay at the top of Amazon’s Computer sales chart in 2008? Steve Jobs sure hopes so.
Share This
Share This
No Comments »
Filed under: Products and services, Apple Inc (AAPL), Amazon.com (AMZN)
This past Monday, Amazon.com (NASDAQ: AMZN) was still open for business care about it always is. There’s no “shutting down” on the web like there is in the real, brick-and-mortar shopping world. What on earth was being purchased on Christmas Eve? Not Christmas presents — those are already under the tree. Gifts for other holidays? Possibly — but you better choose “expedited shipping” when checking out.
When it came to PCs being sold at Amazon’s website a few days ago, the Apple (NASDAQ: AAPL) MacBook made its mark as the #1 PC seller at the world’s largest on the internet retailer. Not Hewlett-Packard (NYSE: HPQ) — which held the 2nd and 3rd spots — not Dell (NASDAQ: DELL) (which isn’t sold at Amazon), and not Gateway (now part of Acer). That design iconoclast and superbly-marketed Apple machine was perched at the top. Not the iPod or the iPhone, but the fully-fledged MacBook laptop Computer.
In what could be seen as the real “breakout” year for Apple laptop personal in 2008, Apple’s entry-level MacBook laptop was even priced at $300 and $500 more than the HP systems which were below it in sales. Right now, HP is the world’s largest laptop Computer seller, as it’s in most retailer outlets, has a strong web sales presence and has aggressive pricing to boot. Apple’s systems, though, continue to set the standard in cool design and “wow” factor, similar to the iPod and iPhone products that were hot sellers this holiday season. Will the MacBooks stay at the top of Amazon’s Computer sales chart in 2008? Steve Jobs sure hopes so.
Share This
Share This
No Comments »
|
|
Entries (RSS)