U.S. Foreclosures to Reach 3.9 Million in Second Record Year
Foreclosure filings in the U.S. will reach a record for the second consecutive year with 3.9 million notices sent to homeowners in default, RealtyTrac Inc. said By Dan Levy
(Bloomberg) — Foreclosure filings in the U.S. will reach a record for the second consecutive year with 3.9 million notices sent to homeowners in default, RealtyTrac Inc. said.
This year's filings will surpass 2008's total of 3.2 million as record unemployment and price erosion batter the housing market, the Irvine, California-based company said.
"We are a long way from a recovery," John Quigley, economics professor at the University of California, Berkeley, said in an interview. "You can't start to see improvement in the housing market until after unemployment peaks."
Miami's Republic Federal year's 131st bank failure
Explore related topics
Story Comments Screener (239)
Alert Email Print Share By Wallace Witkowski
SAN FRANCISCO (MarketWatch) -- Miami's Republic Federal Bank, N.A., became the 131th bank failure of the year, according to the Federal Deposit Insurance Corp. on Friday. 1st United Bank of Boca Raton, Fla. will assume all of Republic Federal's deposits. As of Sept. 30, Republic Federal had total assets of about $433 million and total deposits of about $352.7 million. 1st United will buy $267.1 million of the failed bank's assets. The failure also marks Florida's 13th bank failure of the year.
Is This Just The Beginning Of A Depression?
David Rosenberg, the former Merrill Lynch economist now at Gluskin Sheff, has another of his very bearish reports out, and kicks off with this observation:
The credit collapse and the accompanying deflation and overcapacity are going to drive the economy and financial markets in 2010. We have said repeatedly that this recession is really a depression because the recessions of the post-WWII experience were merely small backward steps in an inventory cycle but in the context of expanding credit. Whereas now, we are in a prolonged period of credit contraction, especially as it relates to households and small businesses.
This rings true to me. The recession vs depression debate is really a matter of semantics, but the facts are that although markets have rebounded impressively, and big companies have regained access to credit, most of the economy and its working-age population will continue to suffer the effects of the current deleveraging for the foreseeable future.
Joyce warns of US 'Armageddon'
MARK DAVIS AND PHILLIP COOREY
THE OPPOSITION finance spokesman, Barnaby Joyce, believes the United States government could default on its debt, triggering an ''economic Armageddon'' which will make the recent global financial crisis pale into insignificance.
Senator Joyce told the Herald yesterday he did not mean to alarm the public but there needed to be a debate about Australia's ''contingency plan'' for a sovereign debt default by the US or even by a local state government.
''A default by the US means complete economic collapse around the world and the question we have got to ask ourselves is where are we in that,'' Senator Joyce said.
His warning came as the Rudd Government ramped up its attack on Senator Joyce as an economic extremist by highlighting his strong opposition to Chinese sovereign investment in Australia.
The Treasurer, Wayne Swan, said it was a cause for concern that Senator Joyce had been elevated ''from the reactionary fringe of our economic debate to the second-most senior economic policymaking job in the alternative government''.
The scrutiny of foreign investment bids was adequate and ''if we were to follow the advice of some of the extremists on foreign investment, it could cost something like 20,000 jobs right across Australia''.
Senator Joyce said the chances of a US debt default were distant but real and politicians were not doing the electorate a favour by refusing to acknowledge the risk.
He said the Federal Government's debt would push up interest rates and predicted that some state Labor governments would not be able to repay their borrowings.
''The Federal Government has $115.7 billion in debt, Australian government securities, notes and bonds on issue, and the states have another $170 billion in debt.
''We have to ask whether the states have the capacity to repay that. I would say in some instances they do not, particularly Queensland.''
Senator Joyce said that if the US recovered, global funds would flow back into North America. ''There will be only one way Australia will be able to keep funds here and that is by putting up interest rates, which will therefore bring real costs back to households,'' he said.
''That is the first scenario, which is extremely bad for Australia. The worse scenario is where the US doesn't repay its debt - the $2 trillion in debt it owes to the Chinese, the $1 trillion in debt it has to the Japanese and the $US1 trillion in debt to others - and then we are really nailed.
''The outcome is a shift away from the US dollar as the international trading currency and a shift to the Chinese yuan, and China becomes an immensely powerful player overnight.
''It's the real financial crisis, and the real financial crisis will mean this preamble we have just had pales into insignificance.''
Asked what sort of contingency plan he would advocate, Senator Joyce said it was like trying to prepare for a tidal wave but the local economy should have more self-reliance.
''Things you look for in that economic Armageddon are the capacity to feed ourselves, the capacity to provide the fundamentals in medicines and basic fundamental requirements for our nation.''