Bank and Mortgage Stock Volatility Signals Disagreement on Mortgage Foreclosure Rate

Abstract:
The extraordinary volatility over the past week in the price of bank and mortgage stocks indicates that investors are taking a hard look at the eventual cost of mortgage foreclosures at large lenders. Investors appear to be about evenly divided between those who think mortgage holders and guarantors have overestimated the value of their mortgage assets and those who think mortgage assets have been under valued.
Comments
07/17/2008 - posted by GT

Fantastic analysis Jim! Very on the point!

June housing starts and permits both Jumped more than expected 9% and 11% comparatively speaksing.  However, don’t let these numbers fool your readers! The reality is much weaker than the numbers show.  Excluding Northeast multifamily acivity (due to building code changes July 1 there is a major rush in that region) Total permits rose less than 1% and starts actually fell 4%.  The key in the June numbers is single-family permits which fell 3.5%. This is a one year low and a trend that will remain firmly downward due to new home sales falling and inventory outragously high!!!!

Lets run for the hills Jim because these numbers will only continue to get worse!

07/17/2008 - posted by Jim Haughey

Thanks GT!  this is the right interpretation of the June housing report

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