Tag Archives: MBS

Given improvements seen in housing, Fannie Mae revised its housing forecast higher for 2012 and 2013 in its November economic outlook report. The GSE's Economic & Strategic Research Group anticipates single-family housing starts will jump 25 percent this year, then rise by another 22 percent in 2013. Existing-home sales should also rise and see a 9 percent increase in 2012 and a 4 percent gain in 2013. Even though reports on the housing sector give reasons to be optimistic, Fannie Mae still warned ""data continue to show a sluggish recovery overall.""

While various economic reports hint at improvements in the nation's economy since the economic crisis was in full swing, improvement is meek and recovery seems too strong a word to describe the progress thus far. Federal Reserve Chairman Ben Bernanke calls the pace of recovery ""disappointingly slow."" In a speech before the New York Economic Club Tuesday, Bernanke pointed out some of the lingering headwinds preventing the economy from more momentous progress.

Two more banks have lost in their attempts to dismiss claims of misconduct in sale of mortgage-backed securities (MBS) to Fannie Mae and Freddie Mac. U.S. District Judge Denise Cote rejected motions filed by Goldman Sachs and Deutsche Bank, two of 16 defendants brought before her court by the Federal Housing Finance Agency (FHFA). In their arguments, attorneys for Deutsche Bank and Goldman say that FHFA's allegations are inadequate to support its claim of fraud.

In a regulatory filing released Thursday, JPMorgan Chase revealed it has reached a settlement with the Securities and Exchange Commission (SEC) to resolve claims against itself and Bear Stearns, which it acquired in 2008. According to the filing, JPMorgan ""has reached an agreement in principle with the staff of the SEC to resolve"" claims under investigation by the regulatory agency. The agreement is subject to SEC and court approval.

Government agencies are continuing their regulatory investigation of mortgage activities at Wells Fargo and Wachovia, according to a report filed with the Securities and Exchange Commission (SEC). Wells Fargo absorbed Wachovia in 2008 when Wachovia's shaky mortgage portfolio threatened the bank's soundness.

Goldman Sachs is asking the U.S. Supreme Court to dismiss a mortgage securities class action lawsuit that the company says could cost Wall Street tens of billions of dollars, according to a report from Reuters. The bank is facing a suit from the NECA-IBEW Health & Welfare Fund, which owned mortgage-backed certificates underwritten by Goldman. The fund is suing on behalf of investors who say they were misled about the securities' risk, Reuters reports. The 2nd U.S. Circuit Court of Appeals in New York decided in September to allow the lawsuit to go ahead on the basis that the NECA-IBEW is acting for investors whose claims ""implicate the same set of concerns"" as its own.

As the Federal Reserve launches its QE3 monetary policy, some interpret the plan as a sign Fed Chairman Ben Bernanke has ""gone 'all in' on the U.S. housing market"" and is clinging to hope the housing market can not only recover itself, but also restore the entire U.S. economy. This, at least, is the outlook of Global Markets Intelligence (GMI) Research. The research firm suggests the Fed is turning to the housing market ""as the last, best hope"" for strengthening the overall economy and restoring ""healthy self-sustained economic growth.""