Down for the eighth consecutive month; index of 10 large U.S. cities shows a price drop of 5% in August, the largest since 1991.
U.S. home prices fell nationwide in August for the eighth consecutive month, according to the S&P/Case-Shiller index released Tuesday.
And things could get worse, said Yale economist Robert Shiller, who helped create the […]

The S&P/Case-Shiller Home Price Indices for August were released Tuesday morning, and the results were once again not pretty.

House prices rose strongly in October, but underlying market activity is clearly slowing
Although demand is weakening, existing homeowners appear in no rush to sell
New buy-to-let landlords will need a long investment horizon to realise good returns

Headlines
October 2007
September 2007

Monthly index * Q1 ‘93 = 100
372.7
368.7

Monthly change*
1.1
0.7%

Annual change
9.7%
9.0%

Average price
£186,044
£184,723

* seasonally adjusted
Commenting on the figures Fionnuala Earley, Nationwide’s […]

In line with market expectations the Fed cut US interest rates by 0.25% to 4.5% in an attempt to support the crumbling US housing market which continues to put a downward pressure on the US economy.

The market reaction was for stocks to rally and the US dollar to fall to new lows with the British […]

By Grace Wong, 
Opportunistic investors have raised huge sums to buy mortgage-backed debt, but are not yet swooping down - a sign the beleaguered securities have further to fall.
Since the subprime crisis erupted earlier this year, vulture investors looking for bargains have been circling battered securities backed by mortgages.
Read Article [offsite]

By Al Yoon
The decline in prices of existing single-family homes accelerated in August and fell at their fastest pace since 1991, according to the Standard & Poor’s/Case Shiller national home price index. S&P said its composite month-over-month index of 10 major metropolitan areas declined 0.8 percent in August to 214.35, for a 5 percent […]

This week in Outside the Box, Van Hoisington and Dr. Lacy Hunt of Hoisington Management undertake an assiduous analysis of the economy, specifically quantifying the underlying impact of the real estate market on GDP growth through the follow-on adverse effects on consumer spending.As outlined in previous publications, the housing debacle has not by any stretch […]

By: Donald_W_Dony
When the last Fed rate cut occurred, it set off a rapid chain reaction in all of the four markets; currencies, commodities, bonds and stocks. For example, the Canadian dollar jumped to par with the U.S. greenback, gold broke out of its 12-month consolidation, U.S. bonds reversed their three year slide and utilities started […]

by gimleteye
The mainstream press doesn’t want to draw the connection, nor does Congress or the White House. State governments, local legislatures and lobbyists are all vested to the hilt in denial: that the downgrade by Moody’s of at least $50 billion in collateralized debt from AAA to junk is tied directly to a pattern of […]

By: Gerard_Jackson 
Current economic commentary is misleading a great number of people. The problem is — as always — bad economics. We can all recall that it was not long ago when we were told by a horde of financial and economic advisers that the subprime market would sink the American economy. What this lot overlooked […]

The Bank of England revealed today that the credit crunch resulted in a sharp drop in mortgage approvals during September 2007, falling to a 2 year low of 102,000 loans down from 108,000 loans in August 2007. The trend is expected to continue as surging repossessions result in more bad debt provisions and hence tighter […]

The Market Oracle expectations are for the UK housing market to fall by 15% over the next two years. However this decline is not expected to be a gradual trend but rather periods of stagnation punctuated by sharp falls which could be of more than 5% in a single quarter! Therefore this article looks at […]

By: Anthony_Cherniawski
“The ABCP market , which had helped finance the housing boom, fell $4.6 billion to $883.7 billion following last week’s $11.0 billion decline, according to Federal Reserve data released on Thursday.
On the other hand, the overall U.S. commercial paper sector grew for a fourth straight week to $1.872 trillion in the week ended Oct. […]

In this Issue:
As the Subprime Turns
“The Market for New Homes is Dead”
Mortgage Pig of the Year
When the Going Get Rough, Simply Borrow More
$100 Oil and $1,000 Gold
More Birthdays, Home Again and Deadlines
As the World Turns is a popular soap opera playing on American TV. It focuses, as do most soaps, on the lives and […]

By Scott Burns 
The bigger problems brought on by the mortgage meltdown may linger, if earlier price plunges in Texas, Los Angeles and Boston are any indicator.
Lately I’ve been getting that déjà vu feeling. If you lived in Texas through the savings-and-loan debacle of the late 1980s, you probably have, too.
If you didn’t, listen up. What […]

Sales of existing homes in the Bay Area and California plummeted in September and prices sank as the subprime mortgage crisis and resulting credit crunch put a squeeze on would-be home buyers, a state real estate trade group reported Wednesday.
The trend was reflected in national numbers as well, where sales dropped by a record number […]

By: Brian_Bloom
There has been a disconnect in logic which has been seriously bothering me in recent weeks. Everything in my training has taught me that ‘the market’ ultimately exerts a discipline on speculative excess, and ‘the market’, being the sum of all players, is more powerful than any one player or set of players. Conceptually, […]

By: Andy_Sutton
In a recent interview with Britain’s Telegraph newspaper, Jim Rogers, the world-renowned investor declared the United States to be in recession. He didn’t stop there. He has taken the next step and rid himself of the downtrodden US Dollar in favor of Chinese Yuan, Japanese Yen and the Swiss Franc. A bold move? A […]

Analysis: Fundamentals are bad, and there’s the credit squeeze on top of that
The housing market is just getting worse. Home resales tumbled 8% in September to the lowest levels in this decade, prompting the obvious question: When will it all end?
Read Article [offsite]

U.S. real estate investment trusts are poised for their biggest decline in almost a decade as higher borrowing costs curb takeovers and reduce property values.After outperforming the Standard & Poor’s 500 Index every year from 2000 to 2006, REIT stocks may drop as much as 20 percent in the next 12 months, according to University […]

Billionaire investor sees problems in the subprime market affecting consumers for up to 2 years, but expresses confidence in U.S. economy.
American billionaire investor Warren Buffett said Thursday that problems in the U.S. subprime mortgage market will likely weigh on consumers for up to two years, but that the U.S. economy will weather the storm.
Read Article […]

By: David_Urban
Security pricing used to mean you checked your Bloomberg terminal or the Wall Street Journal for valuation prices. Now, pricing has become so complex that it has been broken down into 3 separate levels. The short version is that if you are pricing by Level 1, the security is being market to market and […]

By: Tim_Iacono
One day, the “asset prices must always be pushed higher” approach toward preventing the U.S. economy from succumbing to the gravitational pull of deflation will run its course and the ” rentier culture ” will beat a hasty retreat back to wherever it is they came, but after the decision the other day by […]

By: Adrian_Ash
“…If you can’t spot the patsy then it might just be you - or your retirement-fund manager, money-market fund, local government trustees or mutual fund…”
ON AUGUST 8th THIS YEAR , just one day before the sudden and savage “credit crunch” that Alan Greenspan - former head of the US Federal Reserve - now […]

By knowledge.wharton.upenn.edu
It is a scene millions of Americans have been in — sitting next to a real estate agent at closing to sign the loan contract and other papers for a new home. Often, the buyer has spent months with the agent. And to hear agents tell it, they are indispensable guides through the hazardous […]

Stephen Roach is one of my favorite analysts. However, since he moved to Asia to take up new responsibilities, he has not written as much. Thus I was delighted to receive what will be today’s Outside the Box last week. Roach argues that the US is getting ready for a subprime economy and the world, […]

Friday’s bloodbath on Wall Street proved that the troubles in the credit markets have not been relieved by the Fed’s rate cuts. The Dow Jones slipped 367 points on the 20th anniversary of Black Monday, the stock market’s biggest one-day loss in history. Since Friday, Asian markets have plunged; stocks are down sharply in Japan, […]