Tag Archives: Federal Reserve

A drop in housing-related retailers slowed retail sales last month. Total retail sales increased 0.2 percent in July, down from June's 0.6 percent increase, the Census Bureau reported Tuesday. Economists had expected sales to increase 0.3 percent. The weaker-than-expected retail sales report decreases the likelihood the Federal Reserve will begin to taper its bond buying monetary stimulus program.

President Obama is trying to solve the wrong problem by calling, as he did in his speech in Phoenix, for the end of Fannie Mae and Freddie Mac as we know it. To be sure, Fannie and Freddie were not the hallmarks of responsibility in the mortgage meltdown, but have gotten a bad rap. For all their housing expertise, they missed all the signals of the housing bubble (but then again so did Federal Reserve chairman Alan Greenspan and his successor Ben S. Bernanke who dismissed it when the first signs of the meltdown emerged). Instead of suggesting replacing Fannie and Freddie to restore the nation's housing markets, the president should be proposing to return them to their original charters.

The number of job openings rose 29,000 in June to the highest level in five years, the Bureau of Labor Statistics (BLS) reported Tuesday in its monthly Job Openings and Labor Turnover Survey (JOLTS). At the same time, the number of unemployed individuals per job opening dipped below 3 (to 2.99) for the first time since October 2008. The number of unemployed per job opening fell sharply in the construction industry to 6.2 in June--the lowest level since July 2008--from a revised 8.7 in May.

Adding to concerns of a new housing bubble, lenders reported an increase in demand for non-traditional and sub-prime mortgage loans and that they’ve responded to that demand by easing standards, the Federal Reserve reported Monday in its quarterly Senior Loan Officer Opinion Survey. According to the survey, a net 3.1 percent of lenders responding said demand for ""non-traditional"" residential loans increased from the survey released three months ago and a net 25 percent of respondents said demand for loans from sub-prime borrowers was higher than it was in May.

The FOMC voted Wednesday to continue its policy of near-zero interest rates and its $85-billion-per-month bond-buying program. In a subtle change of language designed to assuage nervous stock investors, the FOMC statement said the committee ""reaffirmed its view that a highly accommodative stance of monetary policy will remain appropriate for a considerable time after the asset purchase program ends and the economic recovery strengthens.""

The nation’s economy grew at a 1.7 percent annual rate in the second quarter, the Bureau of Economic Analysis reported Wednesday. Growth exceeded economist forecasts but remained slower than the growth rate needed to add jobs. In the first quarter, GDP grew 1.1 percent and in the second quarter last year, the economy grew at a 1.2 percent annualized rate.

The Federal Reserve Board announced Friday a settlement with GMAC Mortgage that will end the complex and costly foreclosure reviews required through prior enforcement actions. GMAC will pay about $230 million in cash payments to mortgage borrowers as part of the foreclosure deal. According to a statement from the Fed, over 232,000 GMAC borrowers whose homes were in any stage of foreclosure in 2009 and 2010 will receive payment relief.

The Consumer Financial Protection Bureau (CFPB) filed a complaint Tuesday against Castle & Cooke Mortgage LLC over allegations that the company gave bonuses to loan officers who steered customers into mortgages with less favorable terms. The complaint, which was filed in federal district court in Utah, claims that under the direction of company president Matthew A. Pineda and Buck L. Hawkins, the SVP of capital markets, Castle & Cooke violated a rule from the Federal Reserve Board that bans compensation based on loan terms.

The number of days a property spends in delinquency status prior to foreclosure is relatively similar across all states. However, once a property enters foreclosure, the number of days it spends making its way through the foreclosure process and back to market varies drastically with the key determinant being whether a state is a judicial or nonjudicial state, according to information presented at Distressed Residential Real Estate: Dimensions, Impacts, and Remedies, a conference hosted by the Federal Reserve Bank of New York and the Rockefeller Institute of Government held in the fall.

Citing improvements in manufacturing, tourism, commercial and residential real estate and in the financial sector, the Federal Reserve Wednesday said the nation's economy ""continued to increase at a modest to moderate pace"" from late May through early July. The assessment in the periodic Beige Book was tempered by ""mixed"" conditions in the agricultural sector and the absence of improvement in labor markets. ""Hiring,"" the Beige Book said, ""held steady or increased at a measured pace.""