Bulk Investors, 6.5% Unemployment Goal, Dodd-Frank Beliefs, Bill McBride of Calculated Risk, London Hot Spots, Mortgage Banking Outsourcing, Seasonal Decline, Morgan Stanley Forecast, UBS Repurchase Suit, No FHA Bailout, Housing is Popular, QE Not Working Yet


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(read this outstanding) Bulk Investors And The Real-Estate ‘Recovery’ – Submitted by Tyler Durden – Via Pater Tenebrarum of Acting-Man blog – Zero Hedge

Federal Reserve official aims for 6.5% unemployment – By Annalyn Kurtz @CNNMoney – … Known as the 7/3 rule, his initial suggestion would have kept interest rates near zero until the unemployment rate falls to 7% or inflation exceeds 3% a year. Now, he’s changing that proposal, suggesting the central bank keep low interest rates in place even longer. He wants to see the unemployment rate fall to at least 6.5% and inflation not exceed 2.5% a year. …


(Calculated Risk’s Bill McBride) The Genius Who Invented Economics Blogging Reveals How He Got Everything Right And What’s Coming Next – Joe Weisenthal – Business Insider

(demographic list of housing and cars) How The Doomers Got It Wrong – Joe Weisenthal – interviews bill McBride of Calculated Risk – Business Insider

(location, location) London House Prices Rise as Property ‘Hot Spots’ Surge: Economy – By Svenja O’Donnell – … Properties in the city’s nine most expensive districts — where average prices exceed 600,000 pounds — surged 3.4 percent. Nationally, values fell 2.6 percent. … – Bloomberg

The Next Move for Mortgages – By JON LAING – The outsourcing of mortgage banking is the wave of the future, and PHH is primed to benefit. – Barrons

(chart too) Update: Case-Shiller House Prices will probably decline month-to-month Seasonally starting in October – by Bill McBride – … The CoreLogic index has already started to decline on a month-to-month basis. This is not a sign of impending doom – or another collapse in house prices – it is just the normal seasonal pattern. … – Calculated Risk
(fiscal cliff) Morgan Stanley’s Doom Scenario: Major Recession in 2013 – By: Deepanshu Bagchee – CNBC 
(repurchases) UBS Leads Wall Street Bid to Halt FHFA Mortgage-Bond Suit – By David McLaughlin – … (FHFA) claims that loans backing securities sold to Fannie Mae and Freddie Mac were riskier than promised, leading to losses. The original amount of securities at issue in the cases is about $200 billion, according to the agency. UBS, which says FHFA “sat” on its claims, argues the case should be dismissed because the claims expired in 2010 and are time-barred by the so-called statute of repose, according to court filing. … – Bloomberg 
(bailout not needed?) FHA is tweaking programs to improve revenue and cut losses – Among other changes, new borrowers early next year are likely to be charged slightly higher (10bp) annual mortgage insurance premiums. – By Kenneth R. Harney – LA Times

(CRPR paper) Why is housing such a popular investment? A new psychological explanation – Thomas Alexander Stephens, Jean-Robert Tyran – Despite its meagre real returns in the long run, many people still think that investing in housing is a good idea. This column argues that a major reason for the tendency to buy houses is that it’s rare to lose money. Recent research shows people’s perceptions of housing transactions to be shaped by whether they gain or lose money – above and beyond the real returns. – hattip NDP – Voxeu.org 
(no stimulus yet, 2 charts) Some securities purchases but no QE from the Fed yetSober Look Blog  – The Fed’s latest securities purchases are still not having much of an impact on bank reserves (see discussion). The net effect of Fed’s recent activities is equivalent to sterilization, although this is probably not what the central bank had intended. 


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