1 in 8 U.S. homeowners late paying or in foreclosure

One out of eight U.S. households with a mortgage ended the first quarter late on loan payments or in the foreclosure process, in a crisis that will persist for at least another year until unemployment peaks, the Mortgage Bankers Association said on Thursday.

U.S. unemployment in April reached its highest rate in more than a quarter century and is still rising, helping propel mortgage delinquencies and foreclosures to record highs…

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U.S. Congresswoman Supports Mortgage Squatting

Government Regulators Aided IndyMac Cover-Up, Maybe Others

A brewing fraud scandal at the Treasury Department may be worse than officials originally thought.

Investigators probing how Treasury regulators allowed a bank to falsify financial records hiding its ill health have found at least three other instances of similar apparent fraud, sources tell ABC News.

In at least one instance, investigators say, banking regulators actually approached the bank with the suggestion of falsifying deposit dates to satisfy banking rules — even if it disguised the bank’s health to the public.

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GM’s financial struggles may cost thousands of retirees their pensions

Thousands of General Motors retirees in the Tampa Bay area are watching the unthinkable unfold.

Their paternalistic former employer, financial lifeline and symbol of America’s once-dominant manufacturing base is in its toughest fight for survival ever.

GM has warned it could run out of cash next year, and creditors could force the company into bankruptcy if it violates terms of some of its debt next month. Short of a massive federal bailout, the automaker’s stock could be worthless by next year, analysts have predicted. Even a Chapter 11 bankruptcy reorganization may not help unearth new financing because of the global credit crunch. That could mean liquidating the 100-year-old company.

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Making Financial Sense of the Coming Energy Crisis

Bush warns of ‘long and painful recession’

President Bush on Wednesday warned Americans and lawmakers reluctant to pass a $700 billion financial rescue plan that failing to act fast risks wiping out retirement savings, rising foreclosures, lost jobs, closed businesses and even “a long and painful recession.”

His dire warning came not long after the president issued extraordinary invitations to presidential candidates Barack Obama and John McCain, one of whom will inherit the mess in four months, as well as key congressional leaders to a White House meeting on Thursday to work on a compromise.

“Without immediate action by Congress, American could slip into a financial panic and a distressing scenario would unfold,” Bush said in a 12-minute prime-time address from the White House East Room that he hoped would help rescue his tough-sell bailout package.

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Night of the Living Debt

Close your eyes and picture your children, grandchildren and great-grandchildren, all alone and scared, in an old, abandoned graveyard. The moon disappears behind one of the gathering storm clouds. Lurching forms begin to emerge from behind tilting gravestones.

A hand emerges from the earth and clutches at one of your children. They all begin screaming and dashing about, desperately seeking safety that does not exist.

Suddenly, one child shrieks in heart-rending agony as, set upon by three moldy corpses, her slender leg is bitten by one. As each child tries to help the other, he or she also is taken to the ground by slimy zombie-like creatures who begin to feed on the tiny forms.

Then you realize that you are one of the zombies, just as you sink your rotten teeth into the warm, gently yielding flesh of your offspring.

Hollywood “B” movie stuff? No. Reality? Not yet, but it’s coming, even if only euphemistically.

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Max Keiser – Special Liquidity Schemes, Gold and the Dollar

Radical bailout plan has a jawdropping price tag

Struggling to stave off financial catastrophe, the Bush administration on Friday laid out a radical bailout plan with a jawdropping price tag — a takeover of a half-trillion dollars or more in worthless mortgages and other bad debt held by tottering institutions.

Relieved investors sent stocks soaring on Wall Street and around the globe. The Dow-Jones industrials average rose 368 points after surging 410 points the day before on rumors the federal action was afoot.

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Gold and Silver buying opportunity

Twenty-eight years brokering silver & gold have not prepared me for what I met this morning. One of my wholesalers said he was not selling anything, only buying, until further notice. Another refused to give any prices until he adjusted his spreads. Another was spreading one ounce gold coins, normally at $7 – $8, at $25. Another said he was making no sales for immediately delivery or deferred payment, only sales for 30 days delivery paid at once. Premiums were high: Austrian 100 coronas, 4.7%; Sovereigns 5.2%; Krugerrands 6.8%, American Eagles 8.2% (none for immediate delivery), & Mex 50 pesos 4.5%. 90% silver was at $9,783 a bag, a whopping 6.7% premium (1368 cents an ounce on a 1282 market!). Silver American Eagles for 6 – 8 week delivery, 1586 or 23.7% premium.

But “premium” is only one way of looking at things, dividing the item’s price by the spot silver price. Another way to view it is that physical prices have de-coupled from paper prices. The paper prices — futures, ETFs, etc. — no longer rule the market.

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The Real State of the US Economy

In an eerie echo of President Herbert Hoover in 1930, during a Presidential campaign against Roosevelt, following the stock market crash and collapse of numerous smaller banks, Paulson recently appeared on national TV to declare “our banking system is a safe and sound one.” He added that the list of “troubled” banks “is a very manageable situation.” In fact what he did not say was that the US bank deposit insurance fund, the Federal Deposit Insurance Corporation (FDIC) has a list of problem banks that numbers 90. Not included on that list are banks such as Citigroup, until recently the largest bank in the world.

The statement is hardly reassuring. The California savings bank, IndyMac Bank which was declared insolvent a month ago was not on the FDIC list a week before it collapsed. The reality is the crisis created by “securitizing” millions of home mortgages into new financial instruments and selling the packages to pension funds and investors is unfolding like a snowball rolling down the Swiss Alps.

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At most Bennigan’s restaurants, nobody’s home today

Bennigan’s Grill and Taverns across the Tampa Bay area didn’t open today amid reports hundreds of other company-owned stores around the country locked their doors as well.

One exception is the Bennigan’s at Channelside in Tampa, where a franchise owner told a gathering of employees the store intends to remain open.

The other nine Tampa Bay Bennigan’s locations did not open after managers were told at 9 a.m. that the parent company would be liquidated in bankruptcy. The news will put about 400 people out of work in the Tampa Bay area.

Many employees were told they no longer had jobs as they arrived at work.

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Roubini: More Than $1 Trillion Needed to Solve Housing Crisis

Treasury Secretary Hank Paulson has been putting on a full-court press in the last 24 hours, making the case for his plan to shore-up Fannie Mae and Freddie Mac.

“I would rather not be in the position of asking for extraordinary authorities to support the GSEs,” Paulson said in a speech Tuesday in NYC. “But I am playing the hand that I have been dealt. There is a need to support efforts that strengthen Fannie and Freddie’s ability to continue to play their important role in financing mortgages and in our capital markets more broadly.”

The timing of Paulson’s speech — and various and sundry media appearances — is not coincidental. This week, Congress is expected to vote on housing legislation that includes Paulson’s plan, which a GAO report said is likely to cost the government $25 billion.

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Wachovia loses $8.86 billion, slashes jobs

Wachovia Corp (WB.N), the fourth-largest U.S. bank, on Tuesday posted an $8.86 billion second-quarter loss, slashed its dividend and announced 6,350 job cuts after losses tied to mortgages soared.

Its shares fell $1.67, or 12.7 percent, to $11.51 in premarket trading.

The net loss for the Charlotte, North Carolina-based bank equaled $4.20 per share, and compared with a profit of $2.34 billion, or $1.22, a year earlier.

Excluding items, the loss was $1.27 per share, compared with the average analyst estimate of $1.30, according to Reuters Estimates.

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Silver has been Exploding for 5 years now

Whenever silver prices take a dip, people lament the delay in the rise in prices and ask me “When will silver prices explode?”

Well, it’s been exploding for 5 years now. In 2003, silver’s low point was $4.15/oz. in the spring. This year, silver is “about” $18. From $5 to $18 over 5 years is an “average” annual gain of a whopping 29%. It may not seem like a lot because we have such high expectations for silver (along with waiting during price consoladations lasting 1.5 years at a time), but let’s see what 29% gains per year really look like over the next 15 years. Most people don’t seem to understand the power of compounding gains. So, I made two charts to illustrate the points.

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Starbucks releases full list of store closures

Nervous about whether your corner Starbucks is still going to be there to deliver that jolt of caffeine?

It’s a fair question plenty of folks are asking after Starbucks Corp. announced that it would shut 616 company-owned stores by early 2009 as part of a broader plan to boost profit and traffic at its U.S. locations.

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Fannie-Freddie lifeline puts taxpayers on the hook

Now that the federal government has thrown a lifeline to mortgage giants Fannie Mae and Freddie Mac, taxpayers could be on the hook for billions more if the crisis of confidence spreads.

There were encouraging signs Monday for the rescue plan, but also signs of concern — notably on Wall Street, where shares of the two companies slumped further — that the plan won’t be enough.

Other banks are already teetering: National City Corp. shares fell nearly 15 percent on rumors of financial trouble, even though it said it was experiencing no unusual depositor or creditor activity. And Washington Mutual Inc.’s shares fell 35 percent, to a paltry $3.23 amid worries about whether it had enough cash to handle the mortgage market downturn. WaMu said that it did.

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Guarantees for America’s guarantors

US taxpayers are about to find out what their long-standing and (strictly speaking) non-existent guarantee of Fannie Mae and Freddie Mac will cost them. One way to think of it is this: take the US national debt of roughly $9,000bn and add $5,000bn. Not bad for an obligation still officially denied.

In the end, that astounding prospect might be the outcome. Partial or outright nationalisation of the housing lenders – colossal pseudo-private entities that own and underwrite US housing loans – would add some or all of their $5,000bn (€3,144bn, £2,513bn) in liabilities to the government’s balance sheet. While it is true that the agencies (unlike the government) own housing-related assets that roughly match those liabilities, the still-collapsing housing market makes this a lot less reassuring than one could wish.

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Government shuts down mortgage lender IndyMac

IndyMac Bank’s assets were seized by federal regulators on Friday after the mortgage lender succumbed to the pressures of tighter credit, tumbling home prices and rising foreclosures.

The bank is the largest regulated thrift to fail and the second largest financial institution to close in U.S. history, regulators said.

The Office of Thrift Supervision said it transferred IndyMac’s operations to the Federal Deposit Insurance Corporation because it did not think the lender could meet its depositors’ demands.

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