Brent Nyitray
Fairlington Blade
Let the mutherfuker burn!
jnc4p
Kevin S. Willis
Michigoose
lmsinca
markinaustin
Arcanaut
novahockey
quarterback
ScottC
yellojktVital Statistics:
| Last | Change | Percent | |
| S&P Futures | 1306.1 | -2.7 | -0.21% |
| Eurostoxx Index | 2134.4 | -9.1 | -0.42% |
| Oil (WTI) | 82.42 | -0.2 | -0.24% |
| LIBOR | 0.468 | 0.000 | 0.00% |
| US Dollar Index (DXY) | 82.17 | 0.107 | 0.13% |
| 10 Year Govt Bond Yield | 1.59% | 0.00% | |
| RPX Composite Real Estate Index | 179.5 | 0.4 |
Markets are weaker after Moody’s downgraded Spain to one notch over junk and initial jobless claims came in higher than expected. The chart suggests that the trend in initial jobless claims may be changing. The CPI remained muted. Bonds and MBS are slightly lower.
FHFA released its annual report to Congress on the state of the GSEs. The average 2011 mortgage in their portfolio is very high quality – Average LTV < 70%, Average FICO in the mid 70s. The worst stuff (the no-doc and IO loans are finally gone). FHFA characterizes the GSEs as “stabilized” but not “sound.” Fannie and Fred guarantee roughly $100 billion per month and account for 75% of every mortgage originated in 2011. They owe Treasury $187.5 billion.
The NAHB has listed 80 metro areas in their Improving Market Index for June. To be included in the index, the are must have shown improvements in housing permits, employment, and house prices for at least six consecutive months. This is a drop from May where 100 areas were in the index. Map.
The consensus seems to be that Jamie Dimon did well yesterday, by showing contrition where necessary, yet pushing back when he had to as well. The business press seems to believe the Senators went too easy on Dimon.
In keeping with the “where is the inventory” thread I have been discussing the past few days, here is another: Private Equity has raised more than $6 billion to buy and rent foreclosed homes, yet have only deployed about $2 billion of it. Analysts are concerned that political pressure out of Washington is delaying the bulk sales. Maybe someone in Washington wants to goose the housing indices a little bit. He may end up being too clever by half – when the ducks are quacking, you gotta feed them or they go away…
Chart: Initial Jobless Claims:
Filed under: Morning Report |
All Things in Moderation 
“Analysts are concerned that political pressure out of Washington is delaying the bulk sales.”
All the MERS title issues have been resolved?
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We are talking about loans the government already owns..
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Jamie Dimon had the advantage of the language difficulties faced by the Congressmen. They don’t speak finance and they know it.
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Worth noting out of the Supreme Court: Armour v. City of Indianapolis
I always find it interesting when Scalia and Thomas aren’t on the same side of a decision.
“The city gave the 180 property owners affected a choice of how to pay the $9,278 assessment: in a lump sum, or over time with interest. Most chose to pay over 10, 20 or 30 years. Three dozen paid up front, and the city then played them for suckers, announcing a year later that it was changing the way it financed sewer improvements and would issue bonds to cover most of the cost. It would forgive the indebtedness of the installment-payers. But the city refused to give the full-payers any of the refund they demanded.
The full-payers then did what any red-blooded American would do in such a galling circumstance: sue. Their theory was that the city had violated their constitutional right to equal protection.”
…
“When the Indiana Supreme Court ruled against the unhappy homeowners, the homeowners appealed to the United States Supreme Court, where they met the same fate.
Writing for the 6-to-3 majority, Justice Stephen G. Breyer explained that all that was at stake was an economic regulation, to which the court gives the lowest level of scrutiny. “As long as the city’s distinction has a rational basis, that distinction does not violate the Equal Protection Clause,” Justice Breyer said.
Indianapolis had defended its action on the ground of administrative convenience. Processing refunds would have been a hassle, Indianapolis had said, arguing further that refunds for this group of homeowners would have encouraged property owners similarly affected by the policy change throughout the city to demand refunds, too.
And that was good enough, Justice Breyer said: “The Constitution does not require the city to draw the perfect line nor even to draw a line superior to some other line it might have drawn. It requires only that the line actually drawn be a rational line.”
Chief Justice John G. Roberts Jr. wrote a spirited dissenting opinion that Justices Antonin Scalia and Samuel A. Alito Jr. also signed. No, the chief justice said, the city’s reason was not good enough even to meet the minimal standard of mere rationality. Alluding to the language of the 14th Amendment, he objected: “The Equal Protection Clause does not provide that no state shall ‘deny to any person within its jurisdiction the equal protection of the laws, unless it’s too much of a bother.’ ” And he added: “I think the city workers are up to the task.””
http://opinionator.blogs.nytimes.com/2012/06/13/when-enough-is-enough/?ref=opinion
Related:
http://www.hoover.org/publications/defining-ideas/article/119811
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We shall see how they vote the next time the rational distinction raises its ugly head: the same sex marriage case.
Does this put Roberts and Scalia and Alito on the side of the 9th Circuit in that case? Hmmm.
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Worth a read:
“The Second-Rate City?
Chicago’s swift, surprising decline presents formidable challenges for new mayor Rahm Emanuel.
Aaron M. Renn”
http://city-journal.com/2012/22_2_chicago.html
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Mark,
Roberts had stare decisis going for him in Armour, with the previous decision in Allegheny Pittsburgh. Equal protection only requires “rough equality in tax treatment.” The existence of domestic partnerships that carry almost all the same benefits as marriage could fill that gap for Roberts in the Prop 8 case. More interesting, I think, would be the application of “rough equality” on the 1st Circuit DOMA case (Gill) regarding denial of federal benefits for SSM couples.
Roberts threw in a paraphrase from A Man for All Seasons just for effect.
“It profits a city nothing to give up treating its citizens equally for the whole world . . . but for $300,000?”
As an aside, I think Roberts is from northern IN …
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The three most important people in the world right now are two virtual unknowns to the American public Mario Draghi and Angela Merkel, and of course Ben Bernanke.
Kind of Ironic that the three people who did such a pathetic job for Obama, Summers, Romer and Bernstein, are back on the sidelines they so richly deserved never to leave in the first place, while the fate of his presidency is being decided elsewhere.
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Was Jared Bernstein ever really a player? He always seemed to be a mouthpiece to me..
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brent;
Biden’s BFF. Not even an economist at all
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”
“Bank of England, UK Treasury Agree to Ease Tight Credit: UK Finance Minister”
May you live in interesting times!
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