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Archive for March, 2009

Housing Bubble Blog

BEING STREET SMART

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Sy Harding

Nothing Strange About the 2008 Market! November 14, 2008.

There have been a lot of comments in the media and among investors all year about how strange the stock market has been acting this year.

I don’t agree. Except for the wild day-to-day volatility (after the SEC allowed the abolishment of the up-tick rule on short-selling last year) the market has been acting quite normally.

It handled the turmoil created by the collapse of the housing bubble and the onslaught of the sub-prime mortgage mess last year quite well, reaching a new bull market high in October of last year.

Always looking ahead six to nine months, it then topped out normally in anticipation that those problems would finally have the overall economy slowing this year. As recently as the end of August, the S&P 500 was down only 18.1% from its peak of last October. That was normal, since in August Wall Street, the financial media, and even the Federal Reserve, were still assuring consumers and investors that, although the economy was slowing, it would not slow all the way into recession.

Then came recognition that we were headed into a recession. Having to factor that scenario into stock prices, the S&P 500 lost another 9% in September.

As the economic outlook then worsened further, the expectation becoming that the recession will be one of the more serious versions, perhaps as severe as that of 1973-74, the market lost another 17% in October. And the first half of November has not been any better, the S&P 500 declining another 11% in the first two weeks of this month.

I suspect not too many investors realize they have now experienced one of the worst bear markets of the last 70 years, already as bad as any the last generation suffered through.

At the close on November 12, the S&P 500 was down 46% from its peak of last October. In the bear market of 1973-74 the S&P 500 declined ‘only’ 45.1%.

You have to go back to the bear market of 1937-38, 70 years ago, to find a more severe bear market. (The S&P lost 49.1% of its value in that 1937-38 bear). Yes, the current bear market has already been the worst in 70 years, moving the dreaded bear market of 1973-74 back to second place over that period.

So is it possible the stock market has already factored in a recession like that of 1973-74? If so, can it soon look out six to nine months, and anticipate improving economic conditions? Was the October low the low from which smart money buys in anticipation of that?

Speaking of smart money, Warren Buffett’s article in the New York Times a month or so ago, saying it’s time to buy again, has been pretty much forgotten with the market’s further decline.

But here’s another interesting comparison to the market bottom in 1974. In my current book, Beat the Market the Easy Way, I wrote of how Buffett had pulled off one of the most exquisite market-timing moves of all time.

Buffett was not well known in the 1960s when he was running a very successful private investment firm, similar to the hedge funds of today. But after making huge gains in the mid-sixties bull market, he surprised everyone. He cashed out entirely in early 1969 and completely turned his back on the stock market. He liquidated his investment partnership and dispersed the assets back to his investors, telling them they would be better off in government bonds for the next several years.

Then five years later, in 1974, after the severe 1973-74 bear market, in a famous interview in Forbe’s magazine, he said, “This is the time to start investing again.” And he did, using Berkshire Hathaway, which he had taken control of and was running while on hiatus from the stock market, as the holding company for his new investing venture. And the rest is history.

And after another 46% bear market, Buffett is once again saying it’s time to buy? So far he has been early, and has paper losses on his latest known purchases, Goldman Sachs, and General Electric. But he apparently thinks a 46% bear market is sufficient to factor in the possibility of a recession as severe as that of 1973-74.

Food for thought anyway.

Sy Harding publishes the financial website " target="_blank">www.streetsmartreport.com">http://www.streetsmartreport.com/ and a free daily Internet blog at " target="_blank">www.syhardingblog.com">http://www.syhardingblog.com/. In 1999 he authored Riding The Bear – How To Prosper In the Coming Bear Market. His latest book is Beat the Market the Easy Way! – Proven Seasonal Strategies Double Market’s Performance!

About the Author:

Sy Harding is CEO of Asset Management Research Corp., author of 1999's Riding the Bear and 2007's Beat the Market the Easy Way, editor of www.StreetSmartReport.com, and www.SyHardingblog.com.

Article Source: ArticlesBase.com - Nothing Strange About the 2008 Market! November 14, 2008

The Bubble Report : The truth about the housing bubble , no its not all your fault !

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Fha Loan Modification Bank Of America

Getting a Countrywide loan modification is easier than ever. The lender has started a streamlined approval process and their debt to income requirement has fallen to 34%. If you're looking to get a countrywide loan modification, keep the following points in mind to make your chances for approval rise and to take a load of stress off your shoulders filling out the paperwork and waiting to get a response.

You're statistically more likely to be approved if you know Countrywide's requirements first. A few lenders do have the information online, but in most cases you will need to call and speak to their loss mitigation department to get the requirements. You can also get the details on their modification programs from the loss mitigation department.

You can either choose to handle your countrywide loan modification yourself, or you may hire some assistance. Under the Home Affordable Modification Program all homeowners attempting to get a modification are eligible to speak with an FHA representative and to possibly have them negotiate with Countrywide. There are also modification companies available to give you the same services as the FHA reps, but for a fee. These are useful if the wait for an FHA representative is too long. It's recommended to get assistance when trying to get a modification from Countrywide.

You don't just have to fill out the application for modification, you also have to write a hardship letter to explain why you need to have your mortgage modified. The hardship letter may seem intimidating, but there are plenty of sources on line for samples and tips on writing it. If you use some sort of specialist, they will help you write up the letter.

It's worth mentioning that Countrywide only accepts modifications on mortgages started between January, 2004 and December, 2007. Also that Countrywide is now owned by Bank of America, meaning that their requirements are identical to those of Bank of America.

If your mortgage is under Countrywide, it shouldn't be too difficult to get a modification as long as you are backed by some sort of professional. Their approval rate has skyrocketed, though their program selection isn't great.

Also keep in mind that it takes eight weeks for a Countrywide loan modification to be approved. So while a loan modification can help you, it is not an instant solution. What's more is the modification is not an excuse to not make your payments. Be prompt with your monthly payments while awaiting approval.
About the Author:

For additional information and resources home loan modifications, visit the #1 loans modification spot on the net: http://HomeLoanModifications101.com

Article Source: ArticlesBase.com - How to Get a Countrywide Loan Modification

Free Loan Modification Help.

Loan Modification Chapter 13

Question: What can I expect from foreclosure 1 1/2 year after chapter 13?

I filed chapter 13 1 1/2 years ago and have been doing well, making my payments etc. Now, my ARM has adjusted and the bank refused to grant me a loan modification. I am considering foreclosure and am wondering if the process is different since I am already in a 13. Do I need a lawyer? What can I expect. Will it be quicker than the 9-12 months?

Answer: It won't be much different if you are in the Chapter 13. But you didn't mention if the house is included in the Chapter 13 or not. That may change how the bank will go about the foreclosure, but not by very much.

If the house is not in the Chapter 13 plan, then the bank will just file the foreclosure lawsuit, get a sheriff sale date, and attempt to sell the house to pay back the defaulted mortgage. Check your state's foreclosure laws to find out exactly how long this takes.

But if the house is included in the Chapter 13, then once you begin falling behind on payments, the bank will petition the court to have the mortgage dismissed from the bankruptcy plan. Since you wouldn't be making the payments, this would be pretty easy to accomplish -- the Chapter 13 is designed to give you a chance to make the payments on time through the entire plan. If you fall behind, the creditors can have their debt removed and pursue collections again.

In that case, then the mortgage company would begin pursuing the foreclosure process same as normal. They still have to follow the state foreclosure laws and county rules in order to take your home. Nothing would change any of that.

There is just that one extra step of getting the house removed from the bankruptcy payment plan, if you included the house in the Chapter 13. Otherwise, the bank will have to follow the laws that dictate how the foreclosure process will work. And to know how much time you have and other details, you can search online for your state's foreclosure laws.

Hope that helps.
ForeclosureFish

Chapter 7 and 13 - Bankruptcy Attorney in Orange County