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NEW YORK (CNNMoney.com) -- Mortgage rates have been trending down, but that won't do much to benefit those who signed up for low-teaser-rate adjustable-rate mortgages in the past few years. An ARM charges an initial discounted rate for a period of time, after which it adjusts to market levels. When some types of ARMs with teaser rates of 2 percent or less reset, the rates are likely to jump to more than 6 percent - and even as high as 9 percent. Home for sale profiles Help! Young and Ballanco The Orlando-based couple thought they were in a bubble. Are...

US: Another Post-Bubble Shakeout Stephen Roach (New York) Five and a half years ago the equity bubble popped. Within six months, the US economy went into mild recession, and the global economy was quick to follow. Today, America’s housing bubble is finally bursting. Is the die cast for another bubble-induced downturn in the US and global economy? All asset bubbles are alike. Sure, there are obvious differences between equities -- a financial asset -- and homes -- a tangible asset. But to me, the Shiller definition says it all: A bubble is an outgrowth of powerful amplification mechanisms -- both...

On the decline Moody's Economy.com looks at the 100 largest markets and predicts their tops, their bottoms - and total price drops. October 6 2006: 11:42 AM EDT NEW YORK (CNNMoney.com) -- The housing market will get worse before it gets better - that's the finding of an analysis by Moody's Economy.com. In the survey of 379 metro areas, the study's authors project that nearly 20 areas eventually could experience a "crash," or a decline of more than 10 percent from peak to trough. The most hard-hit areas will be in California, the Southwest coast of Florida, and in Arizona...

Risks of recession continuing to rise Economy is slowing, showing warning flags By Will Deener Dallas Morning News Published October 9, 2006 Excerpt: A recent Merrill Lynch economic report said that as much as half of the nation's economic growth is related to housing sales, construction and spending from home equity loans. "The worry here is that a housing decline will have a disproportionate impact on the American consumer," said Gordon B. Fowler, chief investment officer at Glenmede Trust Co., a Philadelphia money management firm. "Prices went up so much in recent years that now as they come down, it...

Just how weak is the Boston real estate market? We got an idea yesterday. And if you’re looking to sell your home in the near future, the news isn’t good. Brand-new luxury condos downtown saw hundreds of thousands of dollars wiped off their value in the Hub’s first public real estate auction in a decade. The 31 condos up for sale in the Folio building on Broad Street sold on average for 30 percent below their asking prices. Some barely fetched their minimums. Even the building’s marketing boss couldn’t hide what happened. “I think the buyers got a better value...

In July, our trade deficit hit yet another all-time record, $68 billion, an annual rate of $816 billion. Imports surged to $188 billion for the month, as our dependency on foreigners for the vital necessities of our national life ever deepens. China's trade surplus with us was $19.6 billion for July alone, moving toward an all-time record of $235 billion for 2006 -- the largest trade deficit one country has ever run with another. Our deficit with Mexico is running at an annual rate of $60 billion. With Canada, it is $70 billion. So much for NAFTA. With the European...

The rate of decline in the US housing market is continuing to surprise the pundits. The number of housing starts - that is, new home construction - fell 6% in August, down almost 20% on last year, the worst annual decline in four years, and a much worse fall than expected. That came hot on the heels of news from the National Association of Home Builders that house builders’ confidence is at its lowest since 1991. “This implies an increasingly negative outlook for the consumer sector given the importance of equity withdrawal and the positive wealth effects housing has provided...

It seems like every month, I'm running into people passing out a slick new business card that announces them as a real estate agent or mortgage broker. Who wouldn't want to get a piece of the action? On certain Portland streets, housing prices are doubling in a matter of months. And when there's this kind of temptation to make quick money, greed can't be far behind.Insiders call it land flipping. Silent second. Straw buyers. Foreclosure fraud. Equity skimming. Air loans. If there's a thought to do it, there's a scheme attached to it."It's the fastest-growing white collar crime in the...

How to bring manufacturing back home -------------------------------------------------------------------------------- Posted: September 29, 2006 1:00 a.m. Eastern In July, our trade deficit hit yet another all-time record, $68 billion, an annual rate of $816 billion. Imports surged to $188 billion for the month, as our dependency on foreigners for the vital necessities of our national life ever deepens. China's trade surplus with us was $19.6 billion for July alone, moving toward an all-time record of $235 billion for 2006 – the largest trade deficit one country has ever run with another. Our deficit with Mexico is running at an annual rate of $60...

One of the many benefits of the now-cooling housing boom — both to consumers and the U.S. economy — was the huge pile of cash extracted in the form of home equity loans and “cash-out” mortgage refinancings. But with home prices flattening, and that multibillion-dollar piggy bank drying up, can consumers continue the shopping spree that accounts for more than two-thirds of the U.S. economy? There was fresh evidence of the housing slump this week, as separate government reports showed prices of both new and existing homes fell year-over year in August. For existing homes, it was the first year-over-year...

SHADOW STATISTICS by Chris Mayer “Listen,” I interrupted, “what nationality are you?” “I’m English,” she replied. “That is, I was born in Poland, but my father is Irish.” “That makes you English?” “Yes,” she said… - Henry Miller, Tropic of Cancer Ben Bernanke, Fed chairman, recently delivered an upbeat view of the U.S. economy. It was cheerful, optimistic…and delusional. The official government statistics hide many warts on the face of the U.S economy. Like makeup dabbed on an aging film star, they are an attempt to cover the wrinkles and present a veneer of youth. To most people, this is...

Sep 20, 2006 4 Major California Home Markets See Drop In Prices (AP) LOS ANGELES A real estate research firm says the median price of a California home increased last month at the slowest annual rate in nine years. Four counties actually saw price declines. Among the largest real estate markets, according to DataQuick Information Systems, the steepest drop was 6.7 percent in San Mateo County. Other decreases were seen in Marin County (2.3 percent), San Diego County (2.2 percent) and Alameda County (1.5 percent). Appreciation in Sonoma, Santa Clara, San Francisco and Contra Costa counties was essentially flat. The...

As rates creep up, borrowers with interest-only loans face sharply higher mortgage payments: Tina Gren Clarence saves $600 a month with an interest-only loan she took out about a year ago for a Petaluma home, yet already is considering heading off the financial hit when her monthly payments could jump. And Peter Shidler, whose low-payment-option loan could turn from a sweet deal into a potentially bitter one, is refinancing and still will pay $500 more monthly on his Santa Rosa home. Gren Clarence and Shidler, like two out of three Sonoma County home buyers and owners, joined the fast-growing club...

Reality setting in on real estate September 2006 American’s castles (homes) are middle class walls of separation from poverty and want. As goes the house goes the family’s ability to fend off tough times and leverage past wealth for opportunity. Borrowing to bridge low income periods, college costs, medical expenses, bail, renovations, retirement and unemployment are all common. This is the proper frame of discussion for the impending debt/depreciation storming of the castle. A few basic facts are worth repeating. $1.06 Trillion in residential mortgages were written in 2005. Nearly 70% of Americans own their residences. The home is by...

In mid-2004, John and Karen Philbrook bought a home in Sacramento’s North Highlands neighborhood, when buying a house seemed like a sure ticket to security. They opted for an interest-only, adjustable-rate mortgage and counted on the value of their house continuing to rise as a way to build up equity. ...[snip] In 2004, Karen and John realized their dream by buying a house in the North Highlands section of Sacramento that’s situated several miles northeast of downtown. It’s a small, three-bedroom bungalow, with a brick chimney running down its wooden exterior. With John’s two jobs and Karen’s at Safeway, the...

Even if the housing numbers get no worse, the economy still may take a big hit. Consumers might run out of home equity to borrow against.The bad news keeps coming from the home front. Buyers are holding back, enough to send median sales prices down 2% or more in Cleveland and Minneapolis. KB Home recently slashed earnings estimates for the second time since June. Shares of home builders have fallen 40% in the past year. The head of Toll Brothers, a big luxury-home builder, says the downturn is the most troubling, and perplexing, in decades: The economy, after all, is...

The worldwide rise in house prices is the biggest bubble in history. Prepare for the economic pain when it pops NEVER before have real house prices risen so fast, for so long, in so many countries. Property markets have been frothing from America, Britain and Australia to France, Spain and China. Rising property prices helped to prop up the world economy after the stockmarket bubble burst in 2000. What if the housing boom now turns to bust? According to estimates by The Economist, the total value of residential property in developed economies rose by more than $30 trillion over the...

Can Wall Street withstand weak housing? Some experts say real estate slump may spell trouble for equities ANALYSIS By Peter Coy BusinessWeek Online Updated: 1:28 p.m. PT Sept 19, 2006 If your nest egg is made of 2-by-4s and you're watching the real estate slowdown with a mixture of fear and nausea, then this article is for you. The question: If real estate tanks, will stocks follow? Or will the market ignore housing? Or maybe — just maybe — will a decline in housing trigger a rise in stocks? It's something you really ought to think about if you're trying...

Growing income disparity doesn’t presage a new labor movement at home — but it may signal more terrorism for us abroad. In 1914, Henry Ford paid his factory workers $5 a day, twice the going rate, with the aim of creating a broad middle class able to buy the cars they were building. Today, that project isn’t faring so well: The Economist reports that in the U.S. “the gap between rich and poor is bigger than in any other advanced country.” And it’s growing. According to the Congressional Budget Office, from 1979 to 2001, the after-tax income of the...

FALMOUTH, Ky. - Used boots fetch $3 and old salt-and-pepper shakers bring in a buck at a makeshift flea market along Highway 27, presumably not what President Bush and Republicans have in mind when they herald a vibrant economy. ADVERTISEMENT Times are "very good for the rich and very, very bad for the poor" who "can't afford to live," laments Larry Mitchell, 43, a now-and-then merchant peddling his wares recently in a submarine sandwich shop parking lot. He says the middle class is "having a hard time." In the Ohio River Valley, where people decry high gas prices, stagnant wages,...