I just read this article in Yahoo! (via Drudge) about how Countrywide (my mortgage loaner) just posted a huge loss this quarter, due to so many borrowers with GOOD CREDIT (aka Prime loans, as opposed to Subprime loans) defaulting or paying late on their loans. The article notes that rather than the sudden interest rate reset rise causing the problems, it's the fact that no one can sell their houses for anything close to what they paid. So now, it's not just the subprime shady loans going bad, IT'S EVERYONE!!
Notable quotes from the article:
-"I do think it's important to observe what happens going forward," Countrywide Chief Executive Angelo R. Mozilo said. "We are experiencing home price depreciation almost like never before, with the exception of the Great Depression." (emphasis mine)
-"The company has set aside $292.9 million in preparation for borrowers missing payments on loans, with some $181 million of that amount for prime home equity loan losses. The reserve is more than four times the size of the reserve established in the second quarter of last year." Good to see they've provided me with a cushion!!
-"Mozilo said the number of unsold homes must fall before the market can begin to recover. He doesn't expect the market will turn around until 2009 at the earliest."
-"Barring a decline in mortgage interest rates, the company said it expects its loan production volume to decline."
The last one is the important one. While Bernanke is off fightin' inflation, the economy is starting to go to shit due to the housing collapse. Fightin' inflation is an admirable battle, but not at the expense of EVERY HOMEOWNER IN AMERICA. The bad thing is, for every asshole investor like me who just has to keep renting out to alcoholic lunatics, there are 5,000,000 poor, struggling families who are going to have to foreclose on their house.
And, speaking of inflation, I don't see Burnin' Bernanke doing anything about my $4.00/gallon gas!
He's such a dream-stealer.
3 comments:
are you down for playing fantasy football this year? the baseball league hasn't been the same without you. i might start a league if no one else in the baseball league does. if you're interested which email address is good for you? you guys have a standing invite to come down to c'ville. maybe a football game. talk to you later.
dave h.
would you like to participate in fantasy football this year? the baseball league's been a little slow without you. if you want in, what's a good email to use?
anyway, you and the wife have a standing invite to c'ville. if not before, football season is coming up.
dave h.
Oh, don't worry Dave, the Nappy Headed Hoez are already signed up.
The good thing about fantasy baseball for me this year is that, rather than sucking in two leagues, I'm only sucking in one.
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