Filed under: Economic data, Housing, Federal Reserve

Existing home prices rose for the first time in seven months in February, proving that homes in some regions have gotten too cheap to ignore.

In fact, as Bloomberg News notes, prices have fallen by the biggest amount by the most in 40 years. Of course, that means that many people now live in homes with mortgages bigger than their values. Supply far outstrips demand in many markets, and at least some experts don’t believe that the market has hit bottom.

“It looks like this may be a temporary pause,” said Nigel Gault, chief U.S. economist at Global Insight Inc. told Bloomberg. “The price declines have helped.”

“We’re not expecting a notable gain in existing-home sales until the second half of this year, but the improvement is another sign that the market is stabilizing,” National Association of Realtors economist Lawrence Yun told The Wall Street Journal.

While the 2.9% gain over January’s figures was better than what economists had expected, the figures were down 24% compared with the same period a year earlier. It will be a buyers’ market for quite some time.

–Freelance writer Jonathan Berr edits the blog Ketchup and Eggs.

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Filed under: Good news, Housing

Regional home loan banks will be granted to boost holdings of mortgage-backed securities by more than $100 billion, federal regulators announced Monday, (pdf) in still another effort to both increase liquidity to and stabilize the mortgage market.

The decision by the Federal Housing Finance Board enables banks in the Federal Home Loan Bank system to increase their holdings of Fannie Mae (NYSE: FNM) and Freddie Mac (NYSE: FRE) securities. The FHFB said it will let banks use their existing capital to increase their holdings of agency mortgage-backed securities for two years. The buys are restricted to securities guaranteed by Fannie Mae and Freddie Mac.

The move comes one week after the regulator for Fannie Mae and Freddie Mac eased capital stipulations for the two home mortgage purchasers, enabling them to add another $200 billion into the mortgage market.

Further, while the overall combined capital infusion amount, about $350 billion, represents a fraction of the $4.5 trillion in mortgage backed securities backed by Fannie Mae and Freddie Mac, economists generally concur the money represents a non-insignificant piece of the housing recovery puzzle.

Housing Sector Analysis: Another positive data point for the U.S. housing sector, which brings the total positive data points this Monday to two, a record of late for the beleaguered sector. The additional capital amount is small, in market terms, but each additional capital amount, or investor, helps, to use a clich

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Filed under: Good news, Economic data, Housing

Existing home sales rose 2.9% in February 2008 to a seasonally-adjusted annual rate of 5.03 million units, the National Association of Realtors announced Monday. Economists surveyed by Bloomberg News had expected February 2008 existing home sales to total a 4.85 million unit annualized rate.

Sales are down 23.8% compared to a year ago. Meanwhile, inventories fell 3% to 4.03 million units, which represents a 9.6-month supply at the current sales pace.

The median sales price also plummeted by 8.2% compared to a year ago, to $195,900. February 2008 sales by region were as follows: Northeast, up 11.3%; Midwest, up 2.5%, South, up 2.1%, and the South, down 1.1%.

February 2008 sales of single-family homes rose 2.8%, while condo sales rose 3.7%.

Housing Sector Analysis: For a change, a good monthly existing home sales report. Sales didn’t rise dramatically, but the important point is that unit sales didn’t decline substantially in February 2008 either, and it’s likely lower home sale prices are beginning to stimulate modest demand. Still, a word of caution to potential home buyers in the United States: median home sales prices are prone to continue to decline through at least Q3 2008. One month’s rise in existing home sales is not almost enough to advocate a trend, and inventories are likely to continue to rise given current foreclosure trends, and due to the approaching spring/summer period when many families planning to move list homes for sale.

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Filed under: Deals, Launches, Industry, Countrywide Financial (CFC), Housing

If you can make money lending money to people who can’t afford mortgages, why not make money buying them back. Several former Countrywide (NYSE: CFC) managers have linked up with Blackrock (NYSE: BLK) to set up a firm, Private National Mortgage Acceptance Company, to purchase troubled mortgages. According to The Wall Street Journal the new operation “seeks to raise more than $2 billion to buy distressed mortgages on the cheap, work with borrowers to restructure them, and then resell them as performing mortgages at a profit.”

The new venture stinks a bit. The people running the venture learned the business at Countrywide, the source of so much of the pain in the current mortgage crisis and the project makes Blackrock appear to be a firm ready to profit from the misfortune of others. Beyond that, the new company seems like a real money-maker.

The Blackrock-supported mortgage-buying operation will have to be careful when it enters the market. If it purchases big packages of home loans and the market keeps falling, the start-up could lose a lot of money. Let’s hope so.

Douglas A. McIntyre is an editor at 247wallst.com.

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ScienceDaily is reporting that researchers at the University of Illinois have broken the record for most information sent via a single photon using the direction of “wiggling” and “twisting” a pair of entangled photons. “Using linear elements, however, the standard protocol is fundamentally limited to convey only one of three messages, or 1.58 bits. The new experiment surpasses that threshold by employing pairs of photons entangled in more ways than one (hyper-entangled). As a result, additional information can be sent and correctly decoded to reach the full power of dense coding.”

Read more of this story at Slashdot.

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Filed under: Products and services, Wal-Mart (WMT)

Wal-Mart Stores, Inc. (NYSE: WMT) indicated last last week that it would start selling milk under its own private label brand (”Great Value”) that is not sourced from cows that have been treated with growth hormones. There are already several brands of milk that have this features (generally, the “organic” brands), but this is the first time I’ve seen a Wal-Mart store brand make a major move like this.

Growth hormones used in cows are administered to increase milk production from those cows, but critics argue that those cows are less healthy and are, in turn, more apt to be treated with antibiotics. It’s been widely reported that most normal supermarket milk is sourced from cows that have been treated with artificial hormones, although without national testing and a complete statistical sampling, it’s hard to tell which have been treated and which have not been. That is, unless you purchase a brand that specifically says “from cows not treated with hormones.”

Preventcancer.com even states that most European countries and Canada ban importation of U.S. milk for this very reason. So my question to Wal-Mart is this: is the new “Great Value” milk choice being offered nationally in all U.S. stores? If so, where is the list of your suppliers? It’s hard to think that the world’s largest retailer could just instantly start offering hormone-free milk to its stores without turning over the natural dairy industry on its head in overnight fashion. The retailer says it is bowing to consumer demand here, which is good. Still — are there enough dairy suppliers that don’t treat their herds with artificial hormones to cater to Wal-Mart’s needs?

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Filed under: Products and services, Apple Inc (AAPL)

Over this weekend, Apple, Inc. (NASDAQ: AAPL) was ripped all over by bloggers, journalists and other media pundits for giving customers of its iTunes music and video software the option of downloading its Safari web browser. For some reason, the fact that Apple was promoting its own web browser product — not as a forced download, but as a voluntary choice — caused some folks to really raise a stink in the press. Really, though, it’s a non-issue.

You see, those folks were comparing Apple to one of the hundreds of nefarious software firms who trick the consumer into installing software without any consent or knowledge. The fact that Apple used its “Software Update” service to give its customers the ability to download its web browser product — completely by choice — can’t be compared to secretly downloading software int he background, but that’s the argument many in the tech world wanted to make.

Now, nitpickers will be arguing Apple’s stance on this for a few weeks before the hubbub dies down, but really there’s not an argument. Of course, there’s always an argument when Apple is discussed in media circles just based on how successful the company is. I personally don’t own a single Apple product, but highly admire the company’s marketing prowess. Promoting its own web browser product really isn’t a crime — as other competing web browser products, I think, has found very creative ways to promote their own products for years and years.

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austinpoet writes in with a blog post debunking the theory we discussed a few days back that scientists’ beer consumption is linearly correlated with the quality of their work. Chris Mack, Gentleman Scientist and beer drinker, has examined the paper and found it is severely flawed. From his analysis: “The discovered linear relationship between beer consumption and scientific output had a correlation coefficient (R-squared) of only about 0.5 — not very high by my standards, though I suspect many biologists would be happy to get one that high in their work… Thus, the entire study came down to only one conclusion: the five worst ornithologists in the Czech Republic drank a lot of beer.”

Read more of this story at Slashdot.

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antipeon alerts us to a presidential preference survey, done in late February and early March, indicating that Obama and McCain lead among IT workers with 29% each. Clinton follows with 13%, just ahead of Huckabee (11%) and Ron Paul (9%). The Computing Technology Industry Association commissioned the poll, and the article notes that this trade group claims the population of IT workers is four times as massive as the Agency of Labor Statistics thinks it is — the superior to make a voting block whose views must be attended to.

Read more of this story at Slashdot.

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