Thursday, March 13, 2008

No mortgage for you

For the past 12-18 months all we've been hearing in the MSM is about this 'subprime' crisis. See, housing was, is and always will be a great investment. Only a teenie, tint percentage of people - THE SUBPRIME - got in trouble. And as Larry Kudlow, Ben Bernanke and Alan Greenspan said to us numerous times, it was all contained.

I have been saying the above is total and complete bullshit. It was not subprime. Subprime was the first symptom of the disease. The disease is and always was too much borrowing. That included prime, subprime, so-so prime. And it didn't just include mortgages. People bought more house than they could afford. But they also bought more car, more plasma, more iPhone, more exotic vacation, and more of everything else. People just borrowed and spent way too damn much.

And here is the result of all that supposed 'contained' problem:

NEW YORK ( -- The credit crunch has finally hit the traditional mortgage market.

Investors are now shunning mortgage-backed securities issued by government sponsored enterprises Fannie Mae and Freddie Mac, which have been critical in keeping the real estate market from completely falling apart. Some fear this development will make it harder for people, even those with strong credit histories, to get a home loan.

"Even if you have good credit, you don't know if they are going to give you a loan or not," said Joseph Mason, a senior fellow at the Wharton School of the University of Pennsylvania.

You don't say. You mean to tell me when people borrow money and don't pay it tack, lenders are less likely to lend? Shocking. Absolutely shocking.

NEW YORK ( -- Foreclosure filings nationwide jumped 60% in February compared with the same month last year, but they decreased slightly versus January, according to a report released Thursday. RealtyTrac, an online marketer of foreclosure properties, said 223,651 homes got hit with foreclosure filings last month, which include default notices, auction sale notices and bank repossessions. 46,508 of those were lost to bank repossessions, which more than doubled over last year.

The report also indicated that foreclosure filings in February fell 4% compared with January, similar to a 6% decrease that occurred during the same time-span in 2007.

HA HA HA. Decreased 4% compared to Jan. Is the MSM really this dense? January has 31 days. February had 29 this year. That is a 6.4% decrease in days. Foreclosures decreased by 4%, meaning they actually increased on a foreclosure per day metric. Come on, MSM you cannot be this ignorant of even the number of days in a month.

And finally this week's most ridiculous MSM story award goes to:

NEW YORK ( -- Mortgage rates rose across the board this week as lower home prices and mortgage rates contributed to a more affordable market for homebuyers, Freddie Mac reported Thursday.

The government-sponsored loan buyer said 30-year fixed-rate loans averaged 6.13% for the week ending Thursday, up from 6.03% last week. Last year at this time, the 30-year rate averaged 6.14%, Freddie Mac said. "The combination of lower house prices and lower mortgage rates contributed to a more affordable market for homebuyers," said Freddie Mac (FRE, Fortune 500) vice president and chief economist Frank Nothaft in a statement Thursday.

If you tried you couldn't write a more ridiculous paragraph.

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