Karen Consumer

With $770B of the $1.4T in commercial mortgages maturing in the next five years currently underwater, FDIC revises its rules (.pdf) to allow banks to keep loans on their books as 'performing' even when the underlying properties no longer cover the outlay.

The banks have already denied credit to those consumers (the prime and employed) able (and willing) to pay, so why would they suddenly change for businesses, especially those banks that are only servicing the debt?

This isn't for the banks, its for the FDIC, so they can push back the number of bank failures for a bit to replenish their own coffers.

Should We Be Reassured by the New Round of Stress Tests?

A better way to look at the "new" stress tests:

Mrs. O'Leary, I understand your cow kicked over the lantern, burned down the barn, and took half of Chicago with it. But the economy depends on you. So, we the people of Chicago, even though we have lost 1/2 of everything, are going to build you a new barn, provide you with a new cow, and give you a brand new shiny lantern, all at absolutely no cost to you.

We TRUST you won't leave the lantern in the barn with the cow again.

Wow: Judges Now Nixing Lenders’ Foreclosure Claims Entirely in Court

The servicer was lacking the original documentation from US Bank saying that it gave the servicer the right to foreclose on the home. When pressed, the servicer gave a signed MERS document dated after the foreclosure filing. All the servicer has to do in the appeal is come up with 1) the documentation that it should have come up with in the first place and 2) a damn good reason why it couldn't find it originally.

I can imagine though that with servicers servicing loans for banks that technically no longer exist or have been merged with who knows how many others, this issue is going to continue to pop up.

Servicers can either continue with the status quo, or start weaning themselves off of the foreclosure gravy train and start modifying loans, rather than take a judicial smackdown when they get a judge who wants actual paperwork and not "because I said so" plaintiffs.

The Greatest Depression Is Coming

17 weeks ago, I was making 20.27 an hour in my office job. Then I lost my job. After 208 applications, 50 outright rejections, 3 'we've decided not to fill the positions', and 3 job interviews, I finally was hired for a part-time job making 7.50 an hour. With what I have in the bank, I should last about 6 months before I have to start worrying about my house (mobile home). I'm not going to stop looking for full-time employment, I just can't wait for that to be my only option.

The economy may not be depressed, but I sure am.

Obama lashes out at health insurers in his weekly radio address, calling their efforts 'deceptive and dishonest.' "For decades, whenever we have tried to reform the system, the insurance companies have done everything in their considerable power to stop us," he said.

Healthcare is not a right. Healthcare is an expense just like transportation, utilities, etc. How much you spend is up to you. Yes, there are those without insurance. But if you are sick (and I don't mean with a headache, I mean truly ill) you can go into any hospital in America and be treated first, then asked to pay later. If that were not true, we would not have pregnant women crossing the border in El Paso, Laredo, Brownsville, etc, to come have their children here. If you're in a car accident, the paramedics don't demand proof of insurance before they look at you. Parkland Hospital here in Dallas County treats everyone, regardless of insurance (and even residency, and I don't mean legal vs illegal).

Our biggest health cost today isn't doctors or medicine, its lawyers. The Obamacare bandwagon keeps on about "unnecessary tests and treatments", but not one thing said about reducing malpractice lawsuit use & abuse (like wrongful life suits when a doctor DOESN'T order every test in the book and the baby is born with a health problem). It's only an unnecessary test if it's negative, or right up until the patient gets the condition/illness/dise... and then the lawyers rush in to say the test would have prevented everything. And what is an unnecessary treatment?

Government Control + No Tort Reform = those 45 million uninsured wishing they had been ignored for just one more election cycle, and the rest of us regretting the next doctors appointment.

Signs of a Consumer Spending Bounce?

Yes, but if I live in a Winnebago and my job market dries up, I can drive my house to a better market, where as if I have a brick & morter home, I mail the keys in and live in my car. Better the Winnebago (much harder to repo as well).

Labor Markets in Need of Help

If I could 1) make my house payment picking up trash in a park and 2) get someone to hire me to pick up trash in a park, I would do it.

This is week 16 of my active job search, and the number of jobs available for me to apply to (and I'm throwing myself at everything and anything that is even remotely like what I was doing before) has dropped dramatically. They've already finished hiring part time help at the malls this year (they advertised for a week, I live in the Dallas/Fort Worth area of Texas).

197 applications/resumes sent/completed, 2 interviews. If this is a stimulated economy, I don't want the government helping any more.

Mortgage Modification Datapoint of the Day, Ocwen Edition

If Ocwen's so good, why are they being sued more than average? Also:

TUESDAY 29 SEPTEMBER 2009
Fitch Ratings has affirmed and removed from Rating Watch Negative Ocwen Financial Corp.'s residential primary servicer rating for subprime product, as well as the company’s special servicer rating. The former rating was affirmed at RPS2, and the latter at RSS2.

Fitch says its rating actions reflect Ocwen's seasoned management team, focused operational and default management capabilities, as well as its proficient use of technology. The ratings also reflect Ocwen's long-term Issuer Default Rating of B+, which was removed from Rating Watch Negative and assigned a stable rating outlook by Fitch on June 3. The removal of the Negative Watch reflects Ocwen's improved financial flexibility.

Ocwen operates its servicing platform from sites in West Palm Beach and Orlando, Fla., and global servicing offices in Bangalore and Mumbai, India, as well as a new operating site in Montevideo, Uruguay. Ocwen continues to expand its offshore strategy with nearly 80% of its servicing operations managed from Bangalore, Mumbai and Montevideo, including customer-facing operations. All of the worldwide operations are wholly owned and operated by Ocwen.

As of April, Ocwen serviced a portfolio of over 298,000 loans with an unpaid principal balance of $39.9 billion. Since Fitch's prior review, Ocwen continued to make incremental enhancements across the servicing platform in expanded training hours for all staff and new hires, enhanced customer Web site and IVR technologies, highly adaptable and extensive scripting technology, and increased resolution opportunities.

Fitch believes Ocwen continues to operate a reliable servicing platform with the appropriate staff, internal control environment and technology to manage its servicing operations and ongoing initiatives. However, Fitch will continue to monitor Ocwen's large-scale offshore operations, as its ability to relocate its servicing functions back to the U.S. quickly is limited.

SOURCE: Fitch Ratings

If 80% of its servicing operations are outside the US, how do we know that their modification numbers are accurate, and not just BS'd into positive advertising.

Unemployment: Is Hiring Around the Corner?

I'm unemployed 15 weeks now, have submitted 186 applications/resumes, and signed up with 3 temp agencies (including Accountemps, a Robert Half company). The temp agencies aren't calling (even though they love my scores/experience), and out of the 186 apps/resumes, I've gotten 2 interviews, 3 "we've decided not to fill the position at this time" and 50 "we've chosen someone else".

Hiring isn't around the corner, it's out of the freaking country.

Putting Job Losses Into Perspective

I'm on week 15 of being unemployed, and I can't even get an interview for a $12 hour job (I was making $20.27). Supposedly there are jobs out there (I've already submitted 176 resumes/applications) because I see the ads, but evidently there are more of me then there are of jobs. I live in the Dallas/Ft. Worth area, we're supposedly not so bad hit by the recession as everyone else. If this is not so bad, I'd hate to be in a bad metro area.

ABC Consumer Confidence Poll: -49, down from -48 for its second straight weekly decline. This week 43% of Americans feel the economy is getting worse, up 12 points from last month. Only 44% rate their personal finances positively and only 24% think it's a good time to buy things.

Yes, I agree with Montanamark, if I could forgo paying off bills for say, 2 years, and not be penalized (not get my car repoed or get my house foreclosed on) I would feel much better about the economy (and we do know how important feelings are with the administration). Better yet , if I could forgo my bills AND get a massive (well in my case, I could settle for, oh say, $50,000, which would be massive to me) cash infusion that I may or may not have to pay off, depending on how I figure my checkbook/balance sheets, that would stimulate my economy to no end!!!

The City of Dallas accounts for another 400 iPhone (AAPL) sales, sending the phones to CEOs in high-cost-of-living areas to try to draw their firms to the Texas metroplex.

I live in Grand Prairie, outside of Dallas. Yes, Dallas (and all of Texas) has a low tax rate compared to the rest of the country, and we are a right to work state (not alot of unions to hold a company back).

But....

Dallas lost Mary Kay Cosmetics because they didn't want to foot the bill for a right hand turn lane to make it easier for Mary Kay employees to get to their corporate headquarters. Dallas City Council is determined to build a 1,000 room convention center hotel on the city's dime even though we already have a glut of hotel rooms (the W just opened up not too long ago). Dallas City Council is filled with "if it's not in my backyard, no one deserves it in theirs" business mentality. The City of Dallas recently laid off (or is in the process of laying off) hundreds of employees, including 200 from the police department, taking much needed officers off the streets to fill civilian desk jobs. We have the most expensive insurance rates (auto, home, business) in the nation. The EPA doesn't like the way we issue permits to electric producers (never mind the fact that the providers are constantly jacking up energy prices).

If the City of Dallas doesn't mind footing the advertising bill to get businesses into Coppell, Grand Prairie, Irving, Fort Worth (Tarrant County, a much better place than Dallas County) then I'm all for it. But don't come to Dallas (or Dallas County) just because Mayor Tom Leppert says its good. Like a long list of mayors before him, he thought he could improve Dallas with common sense, but the democratic machine Dallas serves under only makes Dallas look slightly better than Chicago or Detroit in terms of business sense.

Could FICO Scoring Scheme Boost Housing Market?

Massaging FICO scores matter not in the housing sector. What matters is if they go back to liar loans, which is all I can see them doing, because with unemployment at 9.7%(16%), I don't see a whole lot of people rushing to buy what continues to drop, even at foreclosed prices. Better to wait until mid 2010 before getting all nervous about 'new and improved' FICO scores.

One Problem with Newspaper Micropayments

Uncommon is right, our 'daily paper' the Dallas Morning News mostly reprints Reuters. Occasionally (when there's a big trial) they'll print fresh stuff, but otherwise its police blotters, sports, and Reuters. Better to let the local paper sink into the tar pit and rely on local news stations for up to the minute news (not that they're much better, just faster).

And the national channels (which I've stopped watching because of this) are worse. You watch ABC, NBC, and CBS at their 5:30 Central broadcast, you can flip channels and get the exact same stories in the exact same order. Only the names change (and not to protect the innocent). The last 3.5 minutes of their shows air original content. Better off getting it through Reuters direct.

Sept. Reuters/UofMich Consumer Sentiment Index: 70.2 vs. consensus of 67.3, up from 65.7 in August. 12-month outlook jumps to 79 from 69 in August, the highest since Sept. 2007. "Confidence rebounded in early September as consumers increasingly expected the economy to improve despite their reluctant conclusion that their own financial situation would remain quite problematic for some time."

This is week 11 of being involuntarily unemployed for me. My friend E hit the 1 year mark on September 1. My son's UI just ran out, he's now waiting for the paperwork for the federal extension. My friend L is 2 weeks into her second bout of unemployment in a year.

I want to know what drugs these Consumers are on, because I would very much like some. I am not feeling confident, I am not spending, and I am not expecting things to get better. I've completely stopped watching the big 4 for national news, I just stick to the local channels for local news, because I'm tired of the lies.