sell! sell! sell!

[tiznow]

well SEC doing something you can be the judge if you think its enough.....

this was actually announced earlier today

C expects 500 million loss from this

-----------------------------------

Citigroup returning billions to investors
Thursday August 7, 6:21 pm ET
By Marcy Gordon, AP Business Writer
Citigroup returning billions to investors, paying fine in deals over auction securities

WASHINGTON (AP) -- Citigroup Inc. will buy back more than $7 billion in auction-rate securities and pay $100 million in fines as part of settlements with federal and state regulators, who said the bank marketed the investments as safe despite liquidity risks.

Citigroup will buy back the securities from tens of thousands of investors nationwide under separate accords announced Thursday with the Securities and Exchange Commission, New York Attorney General Andrew Cuomo and other state regulators. The buybacks from nearly 40,000 individual investors, small businesses and charities are not expected to cause significant losses for Citigroup; they must be completed by November.

Similar steps to buy back auction rate securities from customers are expected to be taken by other financial institutions. Bank of America Corp. revealed that it has received subpoenas and requests for information about its sale of the investments. Merrill Lynch & Co. said it will offer to buy back an estimated $12 billion in auction rate securities, though the company has already been actively reducing that amount.

Citi, the nation's largest financial institution, said also will pay $50 million each in civil penalties to New York state and the North American Securities Administrators Association, which represents securities regulators in the 50 states and the District of Columbia.

The SEC also will consider levying a fine on Citigroup, the agency's enforcement director Linda Thomsen, said at a news conference.

New York-based Citigroup agreed to reimburse investors who sold their auction-rate securities at a loss after the market for them collapsed in mid-February. Also under the SEC accord, Citigroup agreed to make its best efforts to liquidate by the end of next year all of the roughly $12 billion of auction-rate securities it sold to retirement plans and other institutional investors. Cuomo said his office will monitor that effort for three months and then decide on a timeframe.

The $330 billion auction-rate securities market involved investors buying and selling instruments that resembled regular corporate debt, except the interest rates were reset at regular auctions -- some as frequently as once a week. A number of companies invested in the securities because, thanks to the regular auctions, they could treat their holdings as liquid, almost like cash.

Major issuers included companies that financed student loans and municipal agencies like the Port Authority of New York and New Jersey. In February, when banks such as Citigroup ceased backstopping the auctions with supporting bids because of concerns about credit exposure, the bustling market collapsed. That left some issuers paying double-digit interest rates because of the terms under which they issued the securities.

"These were conservative investors; that's why they bought these securities," Cuomo said in a telephone interview. "These were not high-risk investors."

The settlements with Citigroup make the investors whole and may point the way to a solution of such cases involving auction-rate securities, he said.

Federal and state regulators have been investigating marketing of the securities by a number of big banks. Another case surfaced this week: the Massachusetts attorney general's office reached a settlement with investment firm Morgan Stanley for allegedly selling the risky auction-rate securities to cities and towns, but presenting the investments as safe.

As part of the settlement filed Wednesday, Morgan Stanley agreed to repurchase $1.5 million in the securities it sold to a pair of local municipalities, and fully reimburse any city or town that invested in auction-rate securities. The New York-based company said it was pleased to settle the case without financial penalty.

Cuomo's office sued the Swiss bank UBS AG last month over billions of dollars in sales in auction-rate securities, and other states have filed similar complaints. Massachusetts last week accused Merrill Lynch of fraud in promoting the sale of auction-rate securities. In May, Wachovia Corp. disclosed that it has received requests from the SEC for information regarding sales of auction-rate securities.

In Citigroup's case, the regulators said the bank marketed the auction-rate securities to many of its customers as desirable and highly liquid investments, while it failed to provide supporting bids for the auctions it managed when demand flagged.

The SEC agreement, which must be formally approved by the agency's commissioners, "provides real relief to investors," Thomsen said. "In a short period of time, about 38,000 individual, small business and charitable organization(s) ... will receive nearly $7.5 billion in liquidity."

Citigroup neither admitted nor denied wrongdoing under the settlements. Its shares fell $1.23, or 6.2 percent, to $18.47 Thursday.

Cuomo said Thursday that litigation over fraud charges "is always an option," but the sort of amicable settlement reached with Citigroup is preferable because it gets money back to injured investors quickly -- as opposed to lengthy court proceedings.

Citigroup said more than 50 percent of its retail clients' holdings in auction-rate securities "have been redeemed or auctioned at par (value) since the crisis began. We remain committed to continuing our work on initiatives that will secure the best and fastest route to providing liquidity to our clients."

Analysts questioned the regulators' action.

"They keep finding ways to attack the industry and that will drive innovation out of New York City and to London, Tokyo and elsewhere," said Richard X. Bove, an analyst with Ladenburg Thalmann & Co.

Bove said investors should have researched what securities they were buying, and that authorities should have pursued individual traders that were misleading clients.

There are other signs the auction-rate securities market is rebounding, which will prevent Citigroup from taking a heavy loss as a result of the buybacks. Citigroup holds some $5.6 billion of those securities on its books, and said its Smith Barney unit recorded a $198 million pretax gain from the investments during the second quarter "as some liquidity returned to the market with a number of auctions being completed."

AP Business Writer Joe Bel Bruno in New York and Associated Press writer Valerie Bauman in Albany, N.Y., contributed to this report.

 

[Anonymous1]

plus something makes me think that once it bottoms its gonna stay down for the count

meaning you aren't gonna see a sharp bounce....

2007 levels won't be seen for a very very very long time....especially in places like cali

also mortgage rates are still high the rate cuts have done nothing on that front....since the banks are still strapped for cash

updated 2:36 p.m. CT, Thurs., Aug. 7, 2008

WASHINGTON - Rates on 30-year mortgages didn’t budge this week, while rates on other home loans were a mixed bag.

Freddie Mac, the mortgage company, reported Thursday that 30-year, fixed-rate mortgages averaged 6.52 percent for the week ending Aug. 7. That was the same as last week’s rate, which marked the second-highest of the year. The highest — 6.63 percent — came the week ending July 24.

freddie/fannie also adding fees for purchase, risk added, the lenders will just add that into that apr, as of 10-08.

 

[tiznow]

gonna be interesting to see the effect once the housing bill kicks in

all its gonna do is attempt to prop up a market that wants to deflate

probably just ends up making the long term bottom be pushed out to a later date

 

[tiznow]

slowly coming to shore are the commercial RE waves

------------------------------

MIT price index for commercial properties declines in Q2
Office properties show biggest decline

August 6, 2008

Transaction sale prices of commercial property sold by major institutional investors declined 2.7 percent overall in the second quarter of 2008 with prices for office properties declining 5.5 percent, according to an index produced by the MIT Center for Real Estate.

The office sector encountered the largest drop in the quarterly transaction-based index (TBI) in a single quarter since 1994, following minor declines in the past two quarters. The decline reduces office property prices to their early 2007 level.

The 2.7 percent decline in the overall quarterly TBI means that prices for properties such as shopping malls, apartment complexes, office buildings and warehouses are now more than 9 percent below peak values attained in mid-2007.

"The down movement this quarter in the overall prices represents the third down quarter out of the last four quarters in the index. This represents a continuation of the correction in commercial property market prices that began last fall -- a correction triggered by the credit crunch caused by the subprime housing mortgage crisis and fueled by concerns about a recession," said Professor David Geltner, research director of the MIT/CRE.

Geltner said, however, that commercial properties, which produce regular income and serve as a major investment asset class, are generally in much better shape than housing. They are still experiencing good fundamental performance in terms of strong income, good occupancy, low commercial mortgage delinquency, and substantial equity capital interested in buying such property.

Geltner noted, nevertheless, that the generally positive fundamentals that currently shore up commercial property are still subject to the threat of a severe economic downturn.

"The biggest threat would be a major recession," he said.

The current declines are consistent with a previously reported widening disconnect between buyers and sellers. The MIT/CRE publishes not only the price index based on closed deals, which declined 2.7 percent, but also compiles indices that separately track movements on the demand side and the supply side of the property market.

The demand-side index tracks the changes in prices that potential buyers are willing to pay (sometimes called a "constant-liquidity" index of the market, because it tracks how much prices would have to change to keep a constant ability to sell as many properties at the same rate of trading volume). That index has now fallen steadily for all of the past four quarters, falling again in the second quarter by the same 2.7 percent as the realized price index. During the past four quarters, the cumulative decline in potential buyers' prices is more than 17 percent versus their mid-2007 peak.

The supply side of the market -- the property owners who are the potential sellers --matched the demand-side movement in the second quarter, also revising their willingness-to-sell prices downward by 2.7 percent, and this lock-step movement kept the overall sales volume tracked by the index nearly constant, at the historically low levels reached earlier in 2008.

Henry Pollakowski, MIT/CRE senior economist and co-director of the Center's Commercial Real Estate Data Laboratory (CREDL), noted that the gap represents "a second consecutive quarter of historically low trading volume."

"This quarter at least shows a pause in any further pulling away of supply from demand such as we had seen in the first quarter," Pollakowski said. "The result of this continuation of the relationship between supply and demand is that the volume of closed transactions tracked by the index remained low this quarter after falling drastically by 47 percent from the last quarter of 2007 to the first quarter of 2008."

Geltner noted that: "The results posted by our index are corroborated by recent evidence from another commercial property price index whose methodology was developed at the MIT/CRE, the Moody's/REAL Index produced by Moody's Investors Service, which showed a decline of 3.5 percent in its latest monthly report, for May, placing that broader index of realized commercial property prices at about 9 percent below its 2007 peak, very similar to the NCREIF-based index reported here."

The TBI tracks the prices that institutions such as pension funds pay or receive when transacting properties such as shopping malls, apartment complexes and office towers. The MIT Center's TBI is based on prices of National Council of Real Estate Investment Fiduciaries (NCREIF) properties sold each quarter from the property database that underlies the NCREIF Property Index (NPI), and also makes use of the appraisal information for all of the currently 6,000 NCREIF properties. Such an index -- national, quarterly, transaction-based and by property type -- had not been previously constructed prior to MIT's development of it in 2006. NCREIF supported development of the index as a useful tool for research and decision-making in the industry.

 

[tiznow]

more cali data for you CS

http://mrmortgage.ml-implode.com/2008/08/07/record-foreclosures-sweep-ca-in-july-breaking-news/

this guy saying bad omen for national foreclosure numbers next week

------------------------------

Record Foreclosures Sweep CA in July - Breaking News

Posted on August 7th, 2008 in Uncategorized

This should be the first you hear of July foreclosure data from any source.

Each month I do a foreclosure report for the state of CA. CA makes up roughly 35% of the total unit count and 40-45% of the total dollar volume of all foreclosures in the nation. ForeclosureRadar supplies the best data available and I add in my mojo each month. Below are the previous two months reports.

* Mr Mortgage: June CA Foreclosure Report…Conditions Arguably Worsen
* Mr Mortgage - RECORD-BREAKING MAY CA FORECLOSURE REPORT

Sean O’toole was interviewed for CNN Money released today and spilled the beans early. Since its now in the public domain I can let out the headline foreclosure data early. Make sure to click that link and read the story. It pertains to the new FHA bailout law and the $4 billion waste of money for states to rehab foreclosed houses.

July was another record month for foreclosures in the state of CA with all hell breaking lose and banks taking back roughly 26,500 homes for $12.5 billion. ’Record-breaking’ is not a good thing in the foreclosure universe. This 25% increase breaks all records ever posted and all foreclosure estimates.

If past percentages hold true, next week when the national numbers are released by other data sources, the numbers should also show a similar increase. However, not everyone gathers data the same way so I can’t guaranty what others will report. If their data do mirror this report, I do not know how the markets will react to this but many times in the past, they have not responded very well to ’surging foreclosure rates’.

In May we passed $10 billion for the first time with $10.4 billion in loans, or roughly 24k homes, going back to the banks. In June, there were $10.2 billion in loans taken back by the banks, a slight drop. This was an encouraging sign until July’s figures were tallied.

To clarify, when I say ‘loans taken back by banks’, these are actual foreclosures. When a home goes to the auction block the bank puts up the opening bid. If no 3rd party bidder comes in, the bank buys it back. All year long in CA at least, banks have been buying back roughly 97-98% of all homes that go on the auction block. That is an astounding figure in and of itself!

This $12.5 billion in foreclosures were from Notice-of-Defaults (NOD) from the February time frame. It takes roughly 140 days in CA to go from NOD to foreclosure auction currently due to the back log. In Feb we had a drop in NOD’s to about 37k due to Feb being a short month. But from March though June we saw NOD’s shoot back up to record levels of about 43k per month (see chart below). This means that the number and dollar amount of foreclosures from Sept through Oct at least should be even greater than July by 10-20% depending on fluctuating cure rates.

My official report will be out in a few days when I will have the final Notice-of-Default, Notice-of-Trustee sale and foreclosure sale figures. I will also release my monthly YouTube video and forward analysis at that time. Until then. Best, Mr Mortgage

CA Housing Market Chart through June 2008. Please note this chart does NOT have July data, as it is not all available as of yet.

 

[tiznow]

problems keep stacking up for cali.....

watch out for that west nile CS.....i don't wish anyone harm....just reporting it as it comes

abandoned swimming pools due to foreclosure problems making matters worse

wonder if west nile just stuck out west now that it made its progress east to west in US....or it just fizzles eventually??

i remember when it was passing through iowa

-------------------------------------

(CBS) <!-- sphereit start -->Health officials in California say the foreclosures crisis may be adding a new wrinkle to the fight against the West Nile virus, as standing water in pools that are being left unattended in backyards of abandoned homes becomes a potent breeding ground for the mosquitoes that carry it.

Epidemiologists have also noticed that a more virulent strain has been making up a disproportionate percentage of this season's early cases.

On The Early Show Thursday, Dr. Alton Barron of New York's Roosevelt Hospital Center noted that 114 cases -- most of them in California -- have already been reported in this new season, compared to almost 4,000 all of last year.

"Since it was first identified in New York City almost a decade ago," Barron told co-anchor Maggie Rodriguez, "there's been a steady westward migration of this West Nile virus."

And, he explained, "Apparently -- this is may be a sign of the times. There has been, as more and more homes are passing into foreclosure and many of those homes have backyard pools, these are being neglected, they're not being maintained. This can become a ripe feeding ground and breeding ground for these mosquito populations."

What might explain the more virulent strain that seems to be making the rounds?

"Viruses are infinitely adaptable. And they (the tougher types) may be pushing out the weaker strains. But what's of great concern to the California officials specifically is that, historically, the more virulent strains have been causing a very small percentage of the cases. But, more recently in this year, of the cases that have been identified, 70 percent are caused by this more virulent, more aggressive strain. And this is the one that actually invades the brain and spinal cord, the central nervous system."

Barron advised that people take precautions to try to prevent mosquito bites, such as wearing long sleeves and pants, avoiding standing water, using insect repellent, and putting screens on windows and doors.

He says people should be sure to see a doctor if symptoms go beyond those normally Associated with viruses: "Clearly, if you just have the viral symptoms, as many of us have, the symptoms of the West Nile virus in approximately 20 percent of cases are just like any other viral illness ... the nausea, vomiting, fever, chills, rashes. Those don't need to be treated.

"But when you become disoriented or you notice your friend or family is becoming disoriented ... having severe muscle weakness, fatigue, even paralysis in the more severe cases, obviously, before these signs come about you need to seek medical care."

 

[Anonymous1]

the areas of heavy foreclosure in the state are very distinct, like the inland empire i.e., counties of san benardino and riverside, in the central valley like sacramento, fresno, etc. there is a generous amount in the south central area of los angeles as well, the upper deserts of lancaster/palmdale, as those people were easy prey for sharps with the stated loans...same in san diego county, the shit areas like chula vista got hit the hardest, while areas like carlsbad had less filings..

west nile has been around these parts for some time now, no bigs there, about as likely as getting hit by lighting in an iowa summer squall...

 

[tiznow]

riverside is a dump and the epicenter in cali i believe as far as housing bust

no clue why anyone would want to live there but to each his own i suppose

san diego will probably be some good pickins at some point nice place to live and baby boomers with money to retire to.....the housing price relative to incomes just got insane

 

[tiznow]

what's the UE rate in cali these days has to be getting near 7-8% by now i would think

remember reading near the end of boom days that 1 in 30 californian's were licensed RE agents

i looked 6.9% in june number i found....not sure what july is if its out yet

 

[tiznow]

iowans steady as can be doing their own little thing while rest of the world has their hyper boom/busts

was 4.0% well below 5.5% national average at the time....in june and we had all the flooding to deal with too

alot of those CC kids i was babbling about above from chitown LOL

only way iowa gets hurt bad is if all the idiots that created the boom outside our state and the world at large causes AG prices to crash

 

[Anonymous1]

have not seen july yet, but by county it is varied, as in the dump, its above 8% and climbing, while here in la county its creeping up towards the 7% range, san diego, orange, the tow down south are holding in the mid 6% range, little more tech down there...same up north, sf fairly stable, but sacramento getting brused...

 

[tiznow]

just don't quite understand why the world at large can't live the content modest lifestyle iowans do

housing didn't boom much and housing markets isn't horrible now i really don't know RE that well but i know people still selling for more than they bought a 3-4 years back with no troubles

we'll see if all ya motha fuckers bring on a depression for us to deal with LOL

back during prohibition when the depression set in we had to make fucking whiskey since couldn't make money farming

templeton rye....great shit....:grandmais

 

[tiznow]

although its quite ironic an iowan hoover was at the helm when the great depression first started....wasn't his fault.....

he took a more hands off approach.........but that's typical iowan and got the boot for FDR socialism mania giving the great FNM's and shit we now dealing with....

just amazes what bush has done to the GOP our house is now infested with liberals....iowa historically very red state

 

[Anonymous1]

i am probably a rare piece of shit, as i now live only miles from where i grew-up...never left this quaking, rioting, smogy melting pot, but hey, at the beach in less than an hour, 2hrs. and i am in la quinta at the resort, and less than that, i am sitting in the mountains, so there is alot to offer here in la-la land, just stear clear of the arm pits...i'll tell you this, when i hit the commerce club for a little hold'em, i'm a big time minority as a whity...

 

[tiznow]

i'm not native iowan but in my blood.....my great grandparents came from holland and farmed in iowa.....grandpa served in WW2....dad grew up in iowa.....got lucky with nam was in the lottery but didn't get number pulled might not be here otherwise.....and have relatives in des moines

 

[Anonymous1]

i'm not native iowan but in my blood.....my grandparents came from holland and farmed in iowa.....grandpa served in WW2....dad grew up in iowa.....got lucky with nam was in the lottery but didn't get number pulled might not be here otherwise.....and have relatives in DM

272 was my number...

 

[tiznow]

man USD is going nuts almost to 75 now.....maybe an overdue short squeeze?

gold and oil holding up fairly good with the continued spike for now

 

[Anonymous1]

man USD is going nuts almost to 75 now.....maybe an overdue short squeeze?

gold and oil holding up fairly good with the continued spike for now

euro briefly fell below 1.5200...

119.98 last on oil....

 

[Anonymous1]

UK Press

"Only a collapse in the global demand for oil can save economies from a supply crisis and crude prices reaching more than $200 a barrel according to a report out today. Energy expert Paul Stevens writing for the Chatham House think tank says that governments and companies are investing too little to meet future needs and a "supply crunch" will hit within "five to 10 years."

 

[eek.]

It'll be those fucking hedge funds again.

They changed the rules recently so you have to publicly declare your interest in a short if it's a quoted stock.

No such restrictions for currencies and gold tho.
Anonymity and market manipulation still possible in those markets.

Hang onto yer hats.
:grandmais