Joined: May 10, 2007 Posts: 2740 Location: The Entropisphere
Posted: Sun Jul 06, 2008 4:59 pm Post subject: Re: Housing & Economic Collapse - In Progress - #2
Ferretlover wrote:
I wouldn't be surprised at all. We can watch ours daily, and so far this year, our 401k is down 21k.
Up 3.9% this year (not that there is much there anyway). If I keep it up at that rate I might keep up with core inflation until next year _________________ "Against stupidity the gods themselves contend in vain."
-Friedrich von Schiller
"What I try, may not work. It may be ineffective. It might even turn out in the pages of history to be the exact wrong thing to do, but I'm going to try to do what I c
IndyMac Seized by FDIC... _________________ "There must be a bogeyman; there always is, and it cannot be something as esoteric as "resource depletion." You can't go to war with that." Emersonbiggins
"... hope is a rotten-thighed whore" Niko Kazantzakis
Posted: Sun Jul 06, 2008 8:50 pm Post subject: Re: Housing & Economic Collapse - In Progress - #2
Quote:
The rate of option ARM delinquencies is already spiking
The next wave of foreclosures is expected to gather strength when the million or so option ARMs start resetting in large numbers next spring. But it seems that many of these loans, which allow borrowers to make minimum payments that don’t even cover the accrued interest, are already going delinquent.
IndyMac Cuts Half its Staff as Mortgage Losses Mount (Update2)
By Ari Levy and Josh P. Hamilton
July 7 (Bloomberg) -- IndyMac Bancorp Inc., the lender that's lost almost 90 percent of its market value this year, will fire half its employees after regulators said the company is no longer ``well capitalized'' and the quarterly loss widened.
IndyMac will slash its workforce by 53 percent to 3,400 employees and curtail lending, the Pasadena, California-based lender said on its Web site. The company said it is working with regulators on a new business plan.
``We don't expect to be able to raise capital until there is more stability and less uncertainty in the housing and mortgage markets,'' Chief Executive Officer Michael Perry said in the statement.
``We don't expect, given the really rough state of the housing market, that IndyMac is going to be able to get out of this,'' said Jason Arnold, an analyst at RBC Capital Markets in San Francisco. ``The big problem is that no one will give them money. There's too much risk involved and not enough value in their franchise.''
No one will give them money? What a surprise! They should have come to roccman and me. _________________ It's already over, now it's just a matter of adjusting.
Joined: Dec 02, 2005 Posts: 6284 Location: Oil-addicted Southern Californucopia
Posted: Mon Jul 07, 2008 5:49 pm Post subject: Re: Housing & Economic Collapse - In Progress - #2
I've tried to stop following this damned, depressing thread, but I can't. I keep getting drawn back to it.
Its gruesome doomerishness is irresistible. I can't let it go. I'm hooked. _________________ "Thank you for attending the oil age. We're going to scrape what we can out of these tar pits in Alberta and then shut down the machines and turn out the lights. Goodnight." - seldom_seen
Joined: Oct 23, 2004 Posts: 5499 Location: New Jersey
Posted: Mon Jul 07, 2008 6:50 pm Post subject: Re: Housing & Economic Collapse - In Progress - #2
Zardoz wrote:
I've tried to stop following this damned, depressing thread, but I can't. I keep getting drawn back to it.
Its gruesome doomerishness is irresistible. I can't let it go. I'm hooked.
Hey but we haven't even discussed the worst case scenario for the credit collapse yet. But the WSJ is discussing it tonight:
Quote:
Mortgage Giants Take Hit On Fears Over Capital
Fannie, Freddie Fall By More Than 15%;
IndyMac in Trouble
By JAMES R. HAGERTY and SERENA NG
July 8, 2008
In a worst-case scenario, if Fannie and Freddie couldn't handle their obligations and the government had to rescue them, the companies' shares probably would be worthless, said Josh Rosner, an analyst at Graham Fisher & Co., a New York research boutique.
Joined: Jun 18, 2005 Posts: 3765 Location: In a van down by the river
Posted: Mon Jul 07, 2008 7:13 pm Post subject: Re: Housing & Economic Collapse - In Progress - #2
Yeah I like this thread.
It is one among many that went from theory to reality.
What I don't like, is realizing that the mistake most of us made was we weren't doomerish enough.
The next step here is going to be lots of bank closers and a run on the stock market on par if not worse than the crash of 29. People still do not understand PO and all businesses will have to price it into how they operate.
Joined: Sep 16, 2004 Posts: 4278 Location: Southwest WI
Posted: Mon Jul 07, 2008 8:54 pm Post subject: Re: Housing & Economic Collapse - In Progress - #2
Quote:
401k_nest_egg_retirement.03.jpg
NEW YORK (CNNMoney.com) -- Falling stock markets around the globe and the credit crunch are putting the pension funds of some of the largest U.S. companies into deeper financial holes, according to a report released Monday.
Since the credit crunch hit last fall, pension plans funded by S&P 1500 companies have lost about $280 billion in assets, according to an actuary at Mercer, a human resources consulting firm.
On paper, the losses from last October tally $160 billion. However, according to Mercer actuary Adrian Hartshorn, the asset losses are closer to $280 billion when pension plan assets and liabilities are considered together. The losses amount to about 7% of a total $4 trillion in pension plan assets.
Companies should be concerned, he said, because - assuming no change in the market - a typical U.S. company can expect their pension expenses to increase between 20% and 30% in 2009. That's due to the higher cost of servicing the pension plan's debt and the smaller return from the plan's assets.
"I think it's important for corporations to be aware of what's going on in their pension plans, as corporations would be concerned when any part of its business is performing badly," Hartshorn said.
According to the report, the total losses on pension assets and liabilities from the last day of 2007 through the end of June has grown to more than $80 billion.
Part of the loss has been reflected in companies' current financial statements, but many losses incurred since the end of 2007 have yet to hit company balance sheets.
The affected pension plans are qualified and non-qualified plans.
I know a few people with pensions who plan to rely on them when they retire in another 10 years or so. I just smile when they talk about it and nod my head. _________________ "Oil is going up because we use too much oil, and the capacity to replace reserves is dwindling"
-President Bush 11/07/07
Joined: Oct 23, 2004 Posts: 5499 Location: New Jersey
Posted: Mon Jul 07, 2008 9:01 pm Post subject: Re: Housing & Economic Collapse - In Progress - #2
frankthetank wrote:
Quote:
401k_nest_egg_retirement.03.jpg
NEW YORK (CNNMoney.com) -- Falling stock markets around the globe and the credit crunch are putting the pension funds of some of the largest U.S. companies into deeper financial holes, according to a report released Monday.
Since the credit crunch hit last fall, pension plans funded by S&P 1500 companies have lost about $280 billion in assets, according to an actuary at Mercer, a human resources consulting firm.
On paper, the losses from last October tally $160 billion. However, according to Mercer actuary Adrian Hartshorn, the asset losses are closer to $280 billion when pension plan assets and liabilities are considered together. The losses amount to about 7% of a total $4 trillion in pension plan assets.
Companies should be concerned, he said, because - assuming no change in the market - a typical U.S. company can expect their pension expenses to increase between 20% and 30% in 2009. That's due to the higher cost of servicing the pension plan's debt and the smaller return from the plan's assets.
"I think it's important for corporations to be aware of what's going on in their pension plans, as corporations would be concerned when any part of its business is performing badly," Hartshorn said.
According to the report, the total losses on pension assets and liabilities from the last day of 2007 through the end of June has grown to more than $80 billion.
Part of the loss has been reflected in companies' current financial statements, but many losses incurred since the end of 2007 have yet to hit company balance sheets.
The affected pension plans are qualified and non-qualified plans.
I know a few people with pensions who plan to rely on them when they retire in another 10 years or so. I just smile when they talk about it and nod my head.
Let's see - retirement funds that invested heavily in commodities, like the California state plan, are considered evil speculators, but those investing heavily in crashing financial shares are considered smart money managers (at least that's what the major media told us after a temporary bounce in financial shares in late March). _________________ It's already over, now it's just a matter of adjusting.
The UK is in serious danger of heading into recession as the credit crunch tightens its hold on the economy, according to a survey of businesses across the country published today. An increase in the number of firms reporting fewer orders, more job cuts and less investment is the latest indication that the British economy is suffering from the effects of the global credit crunch and the steep rise in the price of fuel, food and other raw materials.
Firms in the service sector have seen "alarming" declines in the past three months, with those reporting lower orders outnumbering those recording rises for the first time since 1990, the British Chambers of Commerce's latest quarterly economic survey of 5,000 companies says.
It adds that if these trends continue, the business sector is only three months away from technical recession.
Government figures yesterday showed that manufacturing production in May dropped unexpectedly by 0.5% from the previous month, and was down by 0.8% on this time last year. The wider measure of industrial production, which includes output from utilities and mining, also posted a decline of 0.8% in May.
David Frost, head of the British Chambers of Commerce, said: "These results show a real risk of recession in the coming months. This is deeply worrying, not just for business, but for the consumer too, with both manufacturing and services reporting negative results. The temptation for the government will be to raise business taxes in the next pre-budget report because the exchequer is running out of money. This would be a catastrophe."
Joined: Apr 13, 2005 Posts: 2892 Location: St.Louis, Mo
Posted: Tue Jul 08, 2008 9:41 am Post subject: Re: Housing & Economic Collapse - In Progress - #2
U.S. businesses file for bankruptcy at a faster rate
NEW YORK: The softening economy and the collapse of the housing market caused U.S. businesses to file for bankruptcy protection at a higher annualized rate than individuals, according to data compiled from June court records.
Bankruptcy filings in the U.S. during the month rose 33 percent from a year earlier and may surpass 1 million in a year for the first time since bankruptcy laws were tightened in October 2005.
Individuals this year have filed at an annualized rate that is 23 percent above 2007, while total commercial bankruptcies rose 34 percent, data compiled by Jupiter eSources in Oklahoma City show.
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