Sunday, August 15, 2010

The week ahead...

Mon:

Empire Manufacturing - expectations for a slight increase. Seems like a stretch but this is a very volatile number with a relatively small sample size.

Home Builder Survey - again expectations for a slight increase but the index remains very low compared to historical results.

Tues:

Housing starts - expectations of 565k which would be a slight increase from June. Again this seems like a stretch, but a small uptick during the summer wouldn't be surprising.

Wed:

Architecture Billings - The oversupply of commercial real estate is still depressing large commercial projects.

Thurs:

Initial claims - watch for revisions to past weeks.

Leading Indicators - This could move the market and the expectation is for a slight improvement.

Philly Fed - The consensus is for a print of 7 but there is a wide range even into negative territory. Another potential market mover.

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Boy, I feel like an idiot sometimes for having played by the rules when I read stories like this...

" The result is one of the paradoxes of the recession: the more money you borrowed, the less likely you will have to pay up.

“When houses were doubling in value, mom and pop making $80,000 a year were taking out $300,000 home equity loans for new cars and boats,” said Christopher A. Combs, a real estate lawyer here, where the problem is especially pronounced. “Their chances are pretty good of walking away and not having the bank collect.”

Even when a lender forces a borrower to settle through legal action, it can rarely extract more than 10 cents on the dollar. “People got 90 cents for free,” Mr. Combs said. “It rewards immorality, to some extent.”

Utah Loan Servicing is a debt collector that buys home equity loans from lenders. Clark Terry, the chief executive, says he does not pay more than $500 for a loan, regardless of how big it is.
“Anything over $15,000 to $20,000 is not collectible,” Mr. Terry said. “Americans seem to believe that anything they can get away with is O.K.

That's a terribly profound and depressing statement.

Cheers!

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