Finanzkrise: China „drangsaliert“ Bank of America…

Um ihr Eigenkapital zu erhöhen wollte die Bank of America offensichtlich ihren Anteil an der China Construction Bank verringern – was schlussendlich aber an der Intervention der chinesischen Regierung scheiterte… Interessant, was für Druckmittel die chinesische Regierung hat!

Gefunden bei ftd.de:

Finanzkrise

Peking drangsaliert US-Investor

von Sundeep Tucker (Hongkong) und Jamil Anderlini (Peking)

Die chinesische Staatsführung stellt das Vertrauen westlicher Investoren auf die Probe. Nach Informationen der Financial Times hat Pekings Regierung die Bank of America daran gehindert, ihren Anteil an der China Construction Bank zu reduzieren.

Immobilienkrise: ein weiteres Beispiel aus den USA…

Nach meinem Post „Immobilienkrise: Beispiel aus den USA“ von Anfang November nun ein weiteres konkretes Beispiel einer 4-köpfigen Familie, die sich mit einem Kredit für ihr neues Zuhause vertan hat…

Gefunden bei signonsandiego.com:

Couple renegotiates home loan to stave off soaring adjustable rate
By Melanie Stevens
UNION-TRIBUNE

December 2, 2007

When Michael and Suzanne Hornbeek moved from upstate New York to California three years ago, they were willing to deal with the higher cost of living and a smaller house in exchange for a more lucrative career opportunity, a warmer climate and a relaxed Southern California lifestyle in which to raise their two young children.

They knew the transition from their quarter-acre property and home in Buffalo – which they bought for $128,000 – to their $440,000, 1,400-square-foot Poway condo wasn’t going to be easy. The low-interest loan they were offered through Countrywide helped sweeten the move, though it seemed like a rate too good to be true.

As it turns out, the couple’s instincts were right.

Upon purchasing their home in 2004, the couple accepted a $352,000 interest-only mortgage at 4.97 percent, a rate that was set to adjust Nov. 1 of this year. When they asked Countrywide a few months ago, they learned the rate would initially increase to 7.97 percent this month, and then could continue to increase by 1 percent every six months to a cap of 11.97 percent.

In dollar terms, that meant an extra $880 a month – with more potentially to follow.

“We understood the situation with loan adjustments to be that after our first three years, our low rate would increase to the rate that everyone else is buying at right now,” said Suzanne, 38. “We didn’t realize that we would see an increase of our monthly mortgage payments by several hundred dollars or that we’d now be facing this uphill interest rate climb that we’re not going to be able to afford.”

Such situations have become increasingly common in San Diego County, where thousands of families used adjustable-rate loans to finance houses they might otherwise not have been able to afford. Although homeowners could have dealt with such problems in the past by refinancing, sagging property values have made that a less-viable solution.

The Hornbeeks didn’t appear to have any good options. They could have tried to sell the condo, but they thought its value had fallen to about $400,000 from the $440,000 they paid for it. They could have refinanced, but that also would have required them to come up with the $40,000 difference to make up for the decline in the unit’s value. Or they could have faced foreclosure.

But, as the Hornbeeks learned when they consulted with financial planner Kevin Barrett, there was another alternative: Renegotiate the loan. With lenders reluctant to take over massive numbers of properties they might have difficulty reselling, some have become more willing to work with homeowners such as the Hornbeeks who find themselves in difficult situations.

This turned out to be the solution.

Barrett, whose firm is Barrett Financial Strategies in San Diego, spent several weeks talking with the Hornbeeks about the pros and cons to each option for handling their mortgage. Ultimately, he was able to negotiate a deal with Countrywide under which their loan would increase only to 5.25 percent, a level that would enable them to keep their home.

“The Hornbeeks really were in a predicament, and it’s not so far off from what tons of other people in San Diego are facing with their mortgages right now,” Barrett said. “They knew they could lose their home, but facing it at this stage in the game has at the very least taken some of the burden off their shoulders.”

The Hornbeeks worked with Barrett after volunteering for a San Diego Union-Tribune Money Makeover, sponsored by the newspaper and the San Diego chapter of the Financial Planning Association. In exchange for sharing their story in the newspaper, the Hornbeeks received a comprehensive plan at no charge.

The couple’s situation was complicated by the fact that the family of four depends solely on Michael’s salary to pay the bills: a $2,900 monthly mortgage payment, including taxes and homeowners association dues; a $40,000 school loan; credit card payments; a car loan and their living expenses.

Suzanne used to work as a hair stylist but had to quit a year ago when she was diagnosed with an autoimmune condition. The condition, which requires her to live in dry, warm climates, also ruled out one option the couple considered: returning to New York.

With the thought of moving out of San Diego temporarily off the table, Barrett looked at other scenarios, starting with the possibility of selling the condo and then renting until the couple were able to get back on their feet. Although they could have the $40,000 difference considered by a lender as a forgiven debt, it would still be a source of income that they ultimately could have to pay taxes on.

The option to refinance put them in a similar situation, where a bank or lending institution would only likely give the Hornbeeks the current maximum value of their home, which would again leave them to come up with the remaining $40,000 they initially borrowed.

“This is almost a no-win situation for us,” Suzanne said. “If we refinance, we’re spending $40,000 to keep the place, or we spend $40,000 to lose the place in a short sale. Ideally, we need to stay where we’re at, but we don’t know how to make that happen.”

Foreclosure was another option, one Barrett said could be imminent if the Countrywide rate adjusted from the 4.97 percent to nearly 8 percent. But Barrett pointed out that Countrywide might not be eager to foreclose, which could give the company an incentive to help the Hornbeeks keep their home.

“Banks are not in the business of owning and selling homes, but they’ve had to do it a lot lately with all the foreclosures happening, particularly in San Diego,” Barrett said. “That, and the time it takes to sell the home means more time lenders aren’t receiving mortgage payments. They’re also likely paying Realtor commissions, which make the value of the home decrease.”

Barrett said the ideal scenario would be to negotiate a three-to five-year extension of their initial interest-only loan payments at a rate of 4.97 percent, along with an understanding for how the rate would eventually adjust.

This arrangement would allow the couple to catch their breath over the next few years, pay off some debt, beef up their savings, and potentially ride out the housing market long enough to see their property start gaining value.

Last month, the Hornbeeks and Barrett were able to sit down at the negotiating table with Countrywide representatives to hash out the details. Although the arrangement isn’t yet confirmed, both Barrett and the Hornbeeks are more than pleased with the probable outcome.

According to Barrett, Countrywide is reviewing a tentative proposal to allow the Hornbeeks to keep their initial loan without having to refinance. Instead, Countrywide would renegotiate the terms of their primary mortgage for the full $352,000, an amount that relieves the couple from having to make up the $40,000 difference.

The couple would be able to continue paying on an interest-only loan for the next three to five years at a slightly higher, but manageable, rate of 5.25 percent. Once the interest-only period is up, the Hornbeeks would begin paying off the principal as well as interest for the remaining 22 to 24 years left on the loan. The interest rate would remain at 5.25 percent during this time.

“This is really great news for the Hornbeeks,” Barrett said. “Their mortgage would only go up about $1,000 a year based on the new interest rate, but it’s something we all agree that they’ll be able to manage in the short term. And, as we’d hoped, it will give them some time for the market to recover and for Mike’s salary to increase.”

In addition to their primary mortgage, the Hornbeeks had taken out a second mortgage with Chase for $85,750 at a fixed rate of 8 percent. Barrett and the Hornbeeks have already contacted Chase to pursue similar negotiations to lower the interest rate for that mortgage.

The financial planner gave some advice to other homeowners who might be in a similar situation.

“This is a perfect example of ‘the squeaky wheel gets the oil,’ and I’d encourage other people to do everything they can to save their home from foreclosure,” Barrett said. “There’s a huge time commitment involved with negotiating, and a ton of phone messages and bureaucracy to work through. We eventually got there for the Hornbeeks, and I think it was the best possible solution considering the circumstances.”

The Hornbeeks are just as pleased with the potential outcome, but they also recognize they’ve got a ways to go before stabilizing their finances. At the very least, they’ve made a solid first step, and, as a result of Barrett’s advice, they know what they need to do next.

Eventually, the Hornbeeks would like to focus on saving for their retirement; they’d like to be able to give an annual tithe of $5,000; Suzanne would like to get braces; and the couple would especially like to put some extra savings away for their children’s college and wedding funds.

“Our biggest priority has been dealing with our mortgage,” said Michael, 39. “Kevin has been a great advocate for us, and because of all the work he’s put into helping us to get through this, I think we may have a chance to sit down with him again sometime soon to set up a formula for paying off our debt. We can also start thinking about how we’re going to save for retirement.”

Kann Paulson’s Rettungsplan funktionieren?

… die Meinungen dazu sind eher kritisch. Dazu drei Artikel aus unterschiedlichen Quellen.

Gefunden bei sueddeutsche.de:

04.12.2007 07:00 Uhr
US-Immobilienkrise
Allianz der Hoffnung

Banken und die Regierung wollen den klammen Hausbesitzern in Amerika helfen. Doch das Rettungspaket ist umstritten – und die Krise längst zu einem Thema im Präsidentschaftswahlkampf geworden
Von Nikolaus Piper

Die Zahlen jagen manchen an der Wall Street Schauer über den Rücken: Bei über zwei Millionen zweitklassiger Hypothekendarlehen werden im nächsten Jahr die Zinsen steigen, teils dramatisch. Viele Hausbesitzer werden sich Zins und Tilgung nicht mehr leisten können und mit ihren Zahlungen in Rückstand kommen. Dabei geht es um Kredite von insgesamt 362 Milliarden Dollar, eine Summe, die ungefähr dem Bruttoinlandsprodukt von Dänemark entspricht.

Was mit den kritischen Hypotheken geschieht, ist zu einer Schlüsselfrage für die amerikanische Wirtschaft geworden. An ihr hängt nicht nur das Schicksal von zwei Millionen Familien, sondern auch die Konjunktur des Landes.

Je mehr Familien zahlungsunfähig werden, desto größer sind die Verluste an der Wall Street und desto größer das Risiko, dass die Vereinigten Staaten doch noch in eine Rezession rutschen. Weil dies so ist, hat sich die Regierung George Bush nach monatelangem Zögern jetzt massiv in die Hypothekenfrage eingeschaltet.

Pause bei den Zinsen
Finanzminister Hank Paulson verhandelt mit einer Gruppe von Banken und Wertpapier-Spezialisten über einen Plan, nach dem die Zinsen für bedrängte Schuldner bis zu sieben Jahre lang eingefroren werden sollen. Die Koalition aus Regierung und Finanzbranche trägt den Namen „Allianz Hoffnung jetzt“ und wird die Details des Plans noch in dieser Woche veröffentlichen.

Im Zentrum steht dabei ein fragwürdiges Kreditinstrument, das die Geldverleiher besonders 2005 und 2006 millionenfach verkauft haben: Hypotheken mit anpassbarem Zinssatz. Dabei handelte es sich um Hausdarlehen an weniger solvente Kunden, die entsprechend riskant und teuer sind.

Das Besondere daran ist, dass die wahren Kosten verdeckt werden durch eine meist zweijährige Phase, in der die Schuldner nur einen niedrigeren Lockzins zahlen müssen. Wenn der ausläuft, wird der Kredit umso teurer.

Typischerweise beginnt so ein Darlehen bei sieben bis acht Prozent und springt dann auf 9,5 bis elf Prozent, die 30 Jahre lang zu zahlen sind. Hohe Gebühren, die im Falle einer vorzeitigen Kündigung fällig werden, hindern die Kunden daran, zu einem günstigeren Anbieter zu wechseln.

Solche Kredite haben viele ärmere Familien aufgenommen, besonders Einwanderer aus Lateinamerika. Die Geldverleiher haben die Zinsen mit dem anpassbaren Zinssatz aber auch Kunden aufgedrängt, deren Solvenz eigentlich für eine ganz normale, billigere Hypothek gereicht hätte. Schließlich sind auch Wohlhabende in die Zinsfalle getappt: Sie spekulierten auf weiter steigende Immobilienpreise und kauften Häuser praktisch ohne Eigenkapital, um sie hinterher teurer weiterzuverkaufen. Nun ist die Spekulationsblase geplatzt und die Kreditnehmer verlieren viel Geld.

Bei dem Plan von Finanzminister Paulson und den Banken geht es darum, für bestimmte Familien die Festzinsphase zu verlängern. Dabei sollen möglichst nur jene begünstigt werden, die gerade noch zahlungsfähig sind, die aber durch zwei oder drei Prozentpunkte Zinsunterschied in Not geraten. Ob dies gelingt und wie groß die Gruppe der Begünstigten sein wird, hängt von den noch unveröffentlichten Details des Plans ab.

Bereits jetzt schon ist das Rettungsprojekt an der Wall Street heftig umstritten. Einige Kritiker halten den Plan lediglich für einen Trick, der es den Banken erlaubt, den Tag der Wahrheit hinauszuschieben, an dem sie die Kredite in ihren Büchern abschreiben müssen. Andere halten genau dies für sinnvoll, denn auf diese Weise gewinnen alle Beteiligten Zeit. So oder so wird der Hilfsplan innovativ sein müssen.

Wertpapiere in aller Welt verstreut
Das entscheidende Problem: Die Kredite liegen überwiegend nicht bei den Instituten, die sie einst verkauft haben, sondern wurden in Wertpapiere verwandelt und rund um den Globus verkauft. Es ist daher unmöglich, alle Gläubiger an einen Tisch zu bekommen. Wenn die Großen des Geschäfts, von Citigroup über Countrywide bis zu Wells Fargo, über eine Zinspause reden, verhandeln sie auch über das Geld nicht beteiligter Aktionäre und Investoren.

Hier können schwierige Rechtsfragen auftreten. Entscheidend wird sein, dass die beiden großen Hypothekenbanken Fannie Mae und Freddie Mac bei der Allianz mitmachen. Sie haben zusammen ungefähr 15 Prozent aller US-Hypotheken aufgekauft.

Andererseits stehen alle Beteiligten unter großem ökonomischen und politischen Druck. Die Hypothekenkrise ist längst zu einem Thema im Präsidentschaftswahlkampf geworden. Die demokratische Favoritin Hillary Clinton hat weitreichende Eingriffe in den Markt gefordert. Sollte sich die Branche jetzt nicht mit Hank Paulson einigen, dürfte der Kongress eine Reform des Konkursrechts beschließen, die es einzelnen Richtern überlassen würde, für bedrängte Schuldner Zinssenkungen anzuordnen. Vermutlich würde dies für die Finanzbranche wesentlich teurer.

(SZ vom 4.12.2007/sho)

Gefunden bei ftd.de:

Das Kapital
Der verzweifelte Versuch einer Rettung
Der Plan des US-Finanzministeriums, den von Zinserhöhungen bedrohten US-Eigenheimbesitzern aus der Patsche zu helfen, soll den Steuerzahler angeblich nichts kosten. Weitere Themen in diesem Kapital: Investmentbanking in Asien und Randstad/Vedior.

Das Vorhaben „schließt die Aufwendung von Steuergeldern sowohl für die Finanzierung als auch für die Subventionierung von Branchenmitgliedern oder Hauseigentümern aus“, so jedenfalls Finanzminister Henry Paulson. Recht so, möchte man rufen. Fragt sich nur, wie die US-Regierung dann das sogenannte Trittbrettfahrerproblem umgehen will. Denn jeder einzelne Hypothekenfinanzierer hat ja einen Anreiz, nur die anderen die Zeche zahlen zu lassen – und dennoch von den vermeintlichen Vorzügen des Hilfsplans zu profitieren. Wenn alle anderen mitmachen, würde das ohnehin helfen, den Hausmarkt, die Wirtschaft, die Zahlungsausfälle, die Risikoprämien sowie die strukturierten Hypothekenverbriefungsmärkte zu stabilisieren, nicht wahr? Jede Bank wird sich da fragen: Warum also selbst mitmachen? Im Gegenteil: Setzt die eigene Hypothekenbank die Zinssätze für ihre Kreditnehmer wie vertraglich vereinbart nach oben, fällt das gesamtwirtschaftlich kaum ins Gewicht. Solange die anderen mitmachen, würde jede einzelne Bank sogar doppelt gewinnen, wenn sie außen vor bleibt.

Da aber jede einzelne Hypothekenbank so denken wird, kann der Plan eigentlich nur zum Scheitern verurteilt sein. Das gilt zumindest dann, wenn man von gesetzlichen Zinsvorgaben und einem entfesselten patriotischen Akt des kollektiven Edelmuts absieht. Es sei denn, der Staat gibt jeder einzelnen Bank eben doch fiskalische Anreize, damit sich die Teilnahme an dem Programm für sie tatsächlich lohnt. So sehr der Staat auch versicherte, dass dies eine einmalige Hilfsaktion sei, bestünde dann allerdings die Gefahr, dass Kreditnehmer und -geber das Signal so auffassen: Langt nur weiter zu, denn im Fall der Fälle steht der Staat für euch ein. Das Ergebnis wäre die Aushebelung des marktwirtschaftlichen Systems – mit weitreichenden Konsequenzen für Wirtschaft, Inflation, Dollar und Aktien.

Gut möglich, dass die Anleger auf derlei Bedenken pfeifen und die Finanzwerte noch einmal suchen, wenn die Details des Rettungsplans „bald“ vorgestellt werden. Kluge Anleger sollten sich dann entsinnen, dass die Kreditkrise nicht auf US-Ramschhypotheken beschränkt ist. Die Schulden der US-Wirtschaft belaufen sich auf mehr als 300 Prozent des BIPs. Auf mehr als eine kurzfristige Erholung der Finanzwerte sollte man da nicht hoffen.
…

Gefunden bei bloomberg.com:

Paulson Subprime Plan Offers Little Aid, Analysts Say (Update2)
By Jody Shenn

Dec. 3 (Bloomberg) — U.S. Treasury Secretary Henry Paulson’s negotiations with banks to freeze payments on certain subprime home loans will offer little aid to borrowers, Barclays Plc and UBS AG bond analysts say.

Paulson’s plan is aimed at borrowers with „steady incomes and relatively clean payment histories“ who are able to repay adjustable-rate loans only if their payments don’t rise, he said today at a conference in Washington. In a later interview, he wouldn’t „put a number“ on how many loans would be affected.

Few homeowners may qualify for the proposed aid and many are likely to default even before rates reset higher, Barclays analysts wrote in a report today.

„The subprime reset plan, as it currently stands, is unlikely to be a big help,“ New York-based Barclays analysts Ajay Rajadhyaksha and Sharon Greenberg wrote.

Most borrowers who would be helped by the plan would have their loans reworked without a coordinated effort, UBS’s Thomas Zimmerman wrote Nov. 30. Details of the Paulson proposal haven’t been announced.

Subprime loans, given to people with poor or limited credit histories or high debt, typically offer a low introductory rate for the first two or three years. The rate then resets for the duration of the mortgage, usually 30 years. About 100,000 such loans will reset each month over the next two years, UBS says.

Servicers, the companies in charge of managing outstanding mortgages, won’t necessarily do as many modifications as they should without government intervention, said Larry Litton Jr., president of Litton Loan Servicing LP in Houston.

`Part of the Crowd’
„There continues to be apprehension in the servicing world“ about whether modifying loans in securities before borrowers turn delinquent will lead to accounting problems or investor lawsuits, he said. „Now, you’re part of the crowd.“

His company, which oversees $46 billion of subprime or delinquent loans, modified 4,500 mortgages last month, including 2,000 whose borrowers were current. Litton’s company is being sold by Credit-Based Asset Servicing and Securitization LLC for about to an unidentified buyer.

Only 12 percent of all securitized subprime adjustable-rate loans in California would qualify for fixed payments under a similar agreement between the state and four mortgage servicers last month, the Barclays analysts wrote, based on an announcement saying the deal applies to borrowers who occupy homes, have been making on-time payments and can’t afford higher rates.

Home Price Declines
Assuming that half of subprime balances default or are repaid before rate resets, another 30 percent of borrowers don’t qualify because they’ve missed payments and 20 percent of modified loans eventually default anyway, the Paulson plan only eliminate losses of 60 cents per $100 of subprime loans, versus a total that may be as high as $18 to $20, they wrote.

The extent of home price declines and economic conditions will have a „far greater impact“ on the rates of loan modifications and foreclosures, wrote UBS’s Zimmerman, who is also based in New York.

„I think it’s lip service and essentially not meaningful,“ said Michael Burry, president of Cupertino, California-based hedge-fund firm Scion Capital LLC, which manages about $1 billion. „It will only help those who don’t need to be helped.“

Scion’s Value Fund gained 85 percent during the first nine months of 2007, helped by bets that subprime-mortgage defaults would rise, according to an Oct. 17 investor letter.

California’s agreement with servicers including Litton and Countrywide Financial Corp. was „only incrementally new news“ because it leaves the details of which borrowers qualify to loan servicers, New York-based Credit Suisse Group analysts led by Rod Dubitsky wrote in a Nov. 30 report.

Regulatory Pressure
If the Treasury plan lays out specific details regarding which borrowers should qualify, „it should significantly reduce modification cost,“ potentially encouraging more loan reworking, they wrote. Regulatory pressure may also prod a „minimal“ increase in loan modifications, UBS’s Zimmerman said.

„The only way to ensure a major increase in modifications is for the Federal government to impose a massive, wholesale modification, but that would call into question the sanctity of the legal documents of securitization,“ he wrote. „From all reports no one is seriously considering such an approach.“

For less-senior classes of bonds created in securitizations of subprime mortgages, any potential reduction in losses from government-sponsored modifications probably won’t be enough, Deutsche Bank AG analysts including Karen Weaver and Anthony Thompson wrote in a report today.

Collateralized Debt Obligations
„No amount of government intervention less a complete bailout will save“ subprime-mortgage bonds that originally carried low-investment-grade ratings, they wrote.

Such bonds serve as the holdings of a type of collateralized debt obligation that accounts for about half of the $650 billion of the asset-backed-bond CDO market, the largest source of losses for banks. Higher-rated bonds from those CDOs also account for some of the holdings of other categories of CDOs, which repackage assets such as mortgage bonds and buyout loans into new securities with varying risks.

Modifying loans too aggressively may harm mortgage-bond investors more than it helps them, and not just because the action may reduce payments from borrowers who don’t need the help, said David Stevens, head of a home-lending venture for Fairfax, Virginia-based realty firm Long & Foster Cos.

„In more cases than not, you’re either deferring a problem that will end up being more costly“ because of declining home prices or issues that can’t be cured, or cutting borrower payments unnecessarily, said Stevens, who once held executive roles at a servicer purchased last year by Charlotte, North Carolina-based Wachovia Corp.

To contact the reporter on this story: Jody Shenn in New York at jshenn@bloomberg.net
Last Updated: December 3, 2007 18:10 EST

Kreditkrise: Schulen mit Schwierigkeiten Lehrer zu bezahlen!

Und noch ein Beispiel für die Probleme, die die aktuelle Situation an den Finanzmärkten mit sich bringt – gefunden bei bloomberg.com (Hervorhebungen von mir hinzugefügt):

Florida Schools Struggle to Pay Teachers Amid Freeze (Update4)

By David Evans

Nov. 30 (Bloomberg) — School districts, counties and cities across Florida sought to raise cash after being denied access to their deposits in a $14 billion state-run investment fund.

The Jefferson County school district was forced to take out a short-term loan to cover payroll for the 220 teachers and other employees in the system after $2.7 million it held in the pool was frozen yesterday. At least five other districts also obtained last-minute loans, said Wayne Blanton, executive director of the Florida School Boards Association.

„The unthinkable and the unimaginable have just happened here in Florida,“ said Hal Wilson, chief financial officer of the Jefferson County school district, located 30 miles (48 kilometers) east of the state capital Tallahassee. „What we just experienced here is a classic run-on-the bank meltdown.“

Florida’s State Board of Administration, manager of the Local Government Investment Pool, halted withdrawals yesterday at an emergency meeting after $13 billion was pulled out this month from participants. Governments from Orange County, home of Disney World, to Pompano Beach asked for their money back following disclosures that the fund held $1.5 billion of downgraded and defaulted debt.

An advisory panel of school and local government officials with money in the frozen investment pool told the fund’s management late today, following a more than two-hour conference call, that they won’t accept a return of less than 100 percent of their investment.

Trusting State Board
Wilson said he trusted the State Board of Administration’s assurances that the money was safe even as other pool participants withdrew billions of dollars.

„I should have seen the handwriting on the wall,“ Wilson said. „But I didn’t want to start a run on the pool.“

The board said $1 billion was withdrawn from the pool just before the freeze, reducing the fund’s size to $14 billion, a 48 percent decline for the month. Yesterday, state officials said the pool held $15 billion.

Thousands of school districts, towns and fire departments across the U.S. keep their cash in state- and county-run pools. These public accounts, modeled after private money-market funds, are supposed to invest in safe, liquid, short-term debt such as Treasuries and certificates of deposit from highly rated banks.

By freezing the Florida fund, officials left governments without ready access to cash they are accustomed to drawing upon for routine expenditures. The pool was the largest of its kind in the U.S. at $27 billion before the unprecedented withdrawals.

Rejected Option
The newly formed advisory panel rejected a State Board Administration proposal for a survey of affected agencies to learn whether they would accept as little as 90 cents on the dollar.

„The very fact that you’re out here talking to us about taking less than 100 percent is in my mind unacceptable,“ said MaryEllen Elia, superintendent of Hillsborough County Public Schools. The county has $573 million frozen in the pool, more than any other school district. „You need to figure out how to make the taxpayers in Florida whole.“

The Florida board’s trustees, Governor Charlie Crist, state Chief Financial Officer Alex Sink and Attorney General Bill McCollum, will meet Dec. 4 to consider the crisis.

State Board Administration officials were to select an independent investment adviser today to work over the weekend analyzing the pool’s situation, said Tara Klimek, a spokeswoman for Sink.

Avoiding Conflicts
Officials worked to find an investment bank without a conflict of interest, Klimek said. With input from that adviser, and the newly created advisory panel of pool participants, the board may announce a plan to permit emergency withdrawals at the meeting in Tallahassee, she said.

Standard & Poor’s yesterday said it contacted state officials about whether the fund holds any money for debt service payments by local governments and whether that cash will be made available. The credit-rating company said it hadn’t yet received information and was monitoring the situation.

The Florida fund had invested $2 billion in structured investment vehicles, or SIVs, and other debt tainted by the collapse of the subprime mortgage market, state records show. Connecticut, Maine, Montana and King County, Washington, are among other governments holding similar investments, in smaller quantities, in some cases prompting redemptions.

In Montana, school districts, cities and counties withdrew $247 million from the state’s $2.4 billion investment pool in the past three days. The fund’s executive director in a Nov. 28 memo said the pool held $90 million in an SIV issued by Axon Financial that was downgraded to D, or default, by S&P earlier this week.

Stem Losses
The State Board manages the fund along with other short- term investments and the state’s $137 billion pension fund.

The panel is considering ways to shore up the fund, including obtaining credit protection for $1.5 billion of downgraded and defaulted holdings hurt by the subprime market collapse. In voting for the suspensions, officials sought to stem the flood of money leaving the pool and avoid losses on forced sales of assets.

The investment pool’s debt holdings that were downgraded below its minimum standards have a face value amounting to about 10 percent of the pool. Officials disclosed the investments in a report delivered to Crist Nov. 14 following a month of inquiries by Bloomberg News.

„This situation points up the need for monies held in trust by local and state governments to be subject to searching due diligence and constant risk assessment,“ said Harvey Pitt, former chairman of the U.S. Securities and Exchange Commission.

Downgraded Debt
The fund’s $900 million of asset-backed commercial paper that was downgraded to default amounts to 6 percent of its assets. Another $650 million, or 4 percent, is invested in certificates of deposit at Countrywide Bank FSB, a unit of Countrywide Financial Corp. The bank’s rating was cut to Baa1, three levels above junk status, by Moody’s Investors Service on Aug. 16.

The pool owns $168 million of debt from KKR Atlantic Funding Trust cut to D from B by Fitch Ratings on Oct. 8. It also has $356 million issued by KKR Pacific Funding Trust, cut to D from B by Fitch Ratings on Oct. 2. Fitch said the cut to default on the debt reflected non-payment under the original terms. The debt was restructured to extend the maturities to February and March, and interest payments are continuing.

Default Rating
Florida’s pool has $180 million of paper from Ottimo Funding, cut to D from C by S&P on Nov. 9. S&P said an auction of Ottimo’s collateral „did not generate cash proceeds“ to repay the asset-backed commercial paper.

The pool also holds $175 million of short-term debt issued by Axon Financial Funding, the SIV also held by Montana. It was cut to D from C by S&P this week. S&P said Axon failed to pay liabilities maturing Nov. 26, causing an „automatic liquidation event.“

Wilson at Jefferson County said he plans to withdraw the school district’s money from the pool as soon as he can, and won’t consider investing there again.

„They won’t have to worry about little Jefferson County any more,“ Wilson said.

To contact the reporter on this story: David Evans in Los Angeles at davidevans@bloomberg.net .
Last Updated: November 30, 2007 21:01 EST

Martin D. Weiss zu Countrywide Financial

Gefunden auf moneyandmarkets.com:

The Next Big Bankruptcy
by Martin D. Weiss Ph.D. 11/26/2007

As we warned you here in August … and as I explained on CNBC a few days later … America’s kingpin of mortgages is on a collision course with bankruptcy.

Its name: Countrywide Financial.

If it goes under, the impact on U.S. financial markets will be immediate; the damage to the U.S. economy, long-lasting.

So don’t write this off as just another, fleeting chapter in the housing bust story.

Countrywide is the GM and Ford of the mortgage industry, originating $340 billion in loans in the first nine months of the year — more than the mortgage subsidiaries of Bank of America and Citigroup combined.

It’s the company that can make or break the entire housing and mortgage industry.

If it goes broke, few stock or real estate investors will be able to escape the consequences. Many could lose everything.

Already, Countrywide has laid off about 12,000 employees, a number that could soon rise to 20,000 as mortgage originations plummet.

Already, Bank of America, which infused $2 billion of bailout funds into the company in late August, has seen nearly half its investment go down the drain. In just 93 days!

And already, investors who bought Countrywide’s shares at its recent peak in February have lost four fifths of their capital. All in just 294 days!

Countrywide CEO Mozilo has apparently been urged by advisers to eliminate the company’s dividend, saving about $350 million a year.

But that would hardly be enough.

The company admits it has a whopping $27 billion of delinquent subprime mortgages, more than the total mortgages (delinquent or not) held by some of the nation’s largest banks.

At the same time, the company insists that it has enough cash or credit lines to get by.

For now, maybe.

But if Countrywide is in such dire straits at this stage of the crisis, what will happen as we cross over into 2008, when home foreclosures, already a national epidemic, reach pandemic dimensions?

Under the headline „More to Come,“ even the Wall Street Journal, typically reluctant to make dire forecasts, predicted on Friday that „the subprime loan crisis could accelerate as rates on loans reset.“

And based on data from Banc of America Securities, the Journal charted a course for the industry that could be the final nail in the coffin for Countrywide, including the following facts about the nation’s adjustable-rate mortgages (ARMs):

* There will be a 6-fold surge in the number of subprime ARMs that are resetting at higher interest rates — from $6 billion per month in January of this year to $36 billion per month in the first quarter of 2008.

* At the same time, we will see a similar surge in other ARMs that reset to higher rates — to over $50 billion per month.

* Although homeowners often default on their mortgages and get forced into foreclosure when their rates go up, many subprime mortgages go bad in their first year or so, well before their interest rates have a chance to go higher.

The Mortgage Bankers Association estimates that 1.35 million homes will enter the foreclosure process this year and another 1.44 million in 2008. But even that dire estimate understates the impact of mortgage-rate resets now on the way.

Three More Urgent
Questions for Countrywide
CEO Angelo Mozilo

Question #1. What will happen when politicians twist the arms of mortgage companies like Countrywide to temporarily freeze their interest rates at current levels to help subprime borrowers keep their homes?

My answer: To what degree that gesture will help homeowners avoid foreclosures is unclear. But the impact on lenders is obvious: A big hit to their already-sinking cash flow as all subprime borrowers, whether delinquent or not, are allowed to continue making payments at the current rates — rates that were set artificially low to entice them into the loans.

Question #2. What happens when Fannie Mae and Freddie Mac, now cited as agencies that could help ease the pain for many homeonwers, find that they’re in the same sinking boat?

My answer: Congress and the Fed will rush to help Fannie Mae and Freddie Mac — not Countrywide.

Question #3, the thorniest of all. What happens when the U.S. economy sinks into a recession?

My answer: The housing bust and mortgage meltdown we’ve seen so far have been deepening even without higher unemployment and even without falling incomes. In a recession, expect the Fed to pump in a lot more money overall, but to avoid mortgage company bailouts like a plague.

Despite All This, Wall Street’s
Leading Rating Agencies
Have Not Yet Downgraded
Countrywide Financial

Wall Street still seems to believe that Countrywide Financial, ground zero of the mortgage meltdown, can survive all this.

Indeed, last week, Moody’s confirmed the company’s investment grade credit rating. And the company also enjoys investment grade ratings from the two other major credit rating agencies — Standard & Poor’s and Fitch.

But as we explained to you two weeks ago, the ratings issued by Moody’s, S&P and Fitch are bought and paid for by the very companies that are being rated. (See „Next Phase of the Crisis: The Great Ratings Debacle.„)

And as that money flows into the coffers of the rating agencies, it can corrupt the ratings process from start to finish: The rated companies are empowered to shop around for the most liberal ratings. They get sneak previews of the ratings before they’re published. They can appeal downgrades and delay their publication. And, ultimately, they can fire the rating agency, taking their business elsewhere.

If disk jockeys accepted just a few bucks from record companies, it would be called payola and they could be carted off to jail. But when the Wall Street rating agencies take tens of thousands of dollars from companies like Countrywide for each rating they issue, that’s supposed to be OK.

It’s not OK. Even at its best, this is a system that often delays the needed reviews. When the long-overdue downgrades are finally announced, they’re typically too late to warn investors with enough lead time to take protective action.

My view: Because of the biases built into the ratings process, the rating agencies often give too much credence to unrealistic promises made by the company’s management.

Equally Unrealistic Is the Hope That the Fed
Will Bail Out Companies Like Countrywide
Don’t expect Ben Bernanke to come to the rescue.
He will have his hands full keeping the nation’s thousands of commercial banks — his primary responsibility — out of trouble.

Mike Larson explains why in his article, „The New Savings and Loan Crisis.“ (If you missed it, I highly recommend you read it now.)

His main point: Although banks have more capital than they did during the real estate-driven S&L crisis of two decades ago, the real estate mess today is far bigger than it was back then.

„Meanwhile,“ he writes, „mortgage giants Fannie Mae and Freddie Mac are in freefall. Freddie Mac shares dropped as much as 35% on Tuesday, the biggest drop since it went public in 1988, while shares of Fannie Mae plunged the most since the 1987 stock market crash.“

And investor losses are mounting.
On December 7, 2006, if you had invested $10,000 in Freddie Mac shares, all you’d have left from that investment right now (based on Friday’s close) would be a meager $3,790. The balance of your money — $6,210 — would be down the tubes.

And this is a government-sponsored enterprise that’s supposed to have avoided the subprime mess!

You wouldn’t have fared any better with shares in Washington Mutual. A $10,000 investment in its shares made on December 28, 2006 is worth only $3,926, even after a 5% bounce in the company’s shares on Friday.

You’d have done a bit better with National City and Citibank shares, losing „only“ about half your money. But I don’t think that’s exactly something you’d thank your broker for.

The moral of the story is three-fold:
First, the Fed is likely to focus its efforts on flooding the banking system with liquid funds to try to tamp down the mortgage mess. It’s unlikely to squander precious resources on bailing out individual mortgage lenders like Countrywide, no matter how big they may be.

Second, I fervently hope you’ve heeded our warnings of many months ago to get the heck out of all financial stocks.

Third, I hope you have acted on our recommendations to move into the big bull markets Wall Street has been mostly ignoring — but can ignore no more.

I’m talking about the bull markets in …

* Gold, which has surged from under $300 an ounce just six years ago to $831.75 right now, including a $26 surge on Friday and another $8 rise since.

* Crude oil, which has catapulted from under $20 per barrel to a new, all-time closing high of over $98 last week.

* The euro, which will soon be close to double its value of just 6 years ago … while the dollar continues to fall virtually nonstop, making new all-time lows week after week.

For years, these three markets — gold, oil and foreign currencies — were driven higher by fundamental imbalances in supply and demand.

Now, adding still more fuel to the fire, the Federal Reserve is flooding our economy with cash in a desperate attempt to ease the mortgage mess and credit crunch.

But as I explained to CNBC viewers on Friday, it’s too little, too late for the U.S. economy … and too much, too soon for the falling U.S. dollar. (Click here to watch it now.)

A U.S. recession is unavoidable. And the only weapon the Fed has left to fight it — lower interest rates and more money pumping — is driving the dollar into a tailspin.

That’s why, despite temporary rallies in the one and corrections in the other, financial stocks are likely to continue sinking, while gold, oil and foreign currencies are likely to continue rising.

Just be sure to stay on the right side. And no matter what your favorite investments may be, get out of the way of Countrywide Financial. If it fails, it could take many other real estate and financial investments down with it.

Good luck and God bless!

Martin

Federal Home Loan Bank + Countrywide Financial…

Gestern hatte ich im Post „John Paul Koning: ‘Federal Home Loan Banks to the Rescue!’“ über die (mögliche) Verstrickung der FHLB und dem Bailout von Banken in Amerika berichtet. Heute nun finden sich konkrete Hinweise darauf, dass die FHLB z.B. beim Bailout der praktisch insolventen Countrywide Financial beteiligt sein könnte…

Gefunden bei reuters.com:

UPDATE 1-U.S. Sen. Schumer questions Countrywide borrowing
Mon Nov 26, 2007 5:08pm EST

WASHINGTON, Nov 26 (Reuters) – A U.S. regulator should scrutinize billions of dollars of loans that have helped keep troubled mortgage lender Countrywide Financial Corp (CFC.N: Quote, Profile, Research) afloat in recent months, a leading senator said on Monday.

In a letter to the regulator of the Federal Home Loan Bank system, Sen. Charles Schumer said Countrywide, the largest U.S. mortgage lender, may be abusing the program.

At the end of September, Countrywide had borrowed $51.1 billion from the Federal Home Loan Bank system — a government-sponsored program.

„Countrywide is treating the Federal Home Loan Bank system like its personal ATM,“ Schumer, a New York Democrat who heads the housing panel of the Senate Banking Committee, said in the letter. „At a time when Countrywide’s mortgage portfolio is deteriorating drastically, FHLB’s exposure to Countrywide poses an unreasonable risk.“

Schumer wrote Ronald Rosenfeld, chairman of the Federal Housing Finance Board, who oversees the system of 12 regional banks that offer financing to mortgage lenders like Washington Mutual Inc (WM.N: Quote, Profile, Research) and World Savings Bank, which was bought by Wachovia Corp. (WB.N: Quote, Profile, Research) in May 1996.

Countrywide has done its borrowing through the Atlanta Home Loan Bank. Both Rosenfeld’s office and the Atlanta bank declined to comment on the Schumer letter.

The Home Loan Bank system raises money by issuing bonds guaranteed by all their members and which investors give a preferred status because of an implied government backing.

For Countrywide, the Home Loan Banks have offered a source of relatively cheap and steady funding in recent months as its own bonds are now trading at junk status.

Countrywide increased its FHLB borrowing from 28.83 billion in the three months between mid-year and the end of September.

The California-based lender has put up about $62.4 billion of mortgages as collateral for its $51.1 billion in FHLB borrowing.

Shares of Countrywide closed down 10.5 percent at $8.64 on Monday. Last Wednesday the shares closed below $10 for the first time in more than five years. (Reporting by Patrick Rucker; editing by Leslie Adler)

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