Massachusetts Accuses Merrill of Fraud

The top securities regulator in Massachusetts accused Merrill Lynch on Friday of defrauding the city of Springfield with subprime-linked investments, casting light on how Wall Street banks sold complex mortgage securities that are now plummeting in value as the housing slump deepens. Skip to next paragraph Stephan Savoia/Associated Press William Galvin, Massachusetts secretary of state, […]

The banks’ £4bn protection racket

After a record fine for an ‘extortionate’ loan protection scheme, customers are urged to claim back what they are owed By Martin Hickman, Consumer Affairs Correspondent Published: 17 January 2008 A new scandal is brewing in the personal finance industry that could dwarf the revolt against overdraft charges which has tarnished the reputation of the banks […]

Anatomy of a credit crisis

Northern Rock’s collapse and Citigroup’s disastrous losses stem from the same roots, planted a decade ago, but still not widely understood By Sean Farrell Published: 06 November 2007   With the credit crisis entering a new and possibly more dangerous phase, and Wall Street heads rolling left, right and centre, the question on everyone’s lips – […]

China Sovereign Wealth Fund Could Buy Every Public US Company

The average American has only gained wealth in the last five years because his house rose in price. Now even that is going away. And unfortunately for him…and for the US economy generally…he already spent the wealth that is now disappearing. Each year, the MEW (Mortgage Equity Withdrawal) grew higher…until it reached a peak in […]

Goldman Sachs Escaped Subprime Collapse by Selling Subprime Bonds Short

Phew! That was close. For a moment there, it looked like the collapse of the subprime mortgage market was going to wipe billions off financial earnings for years to come. The bad debts were stacked up like poisoned berries gathered by a poison-crazed squirrel during the housing bubble of 2003-2006. Going bad – fast – […]

It’s Time For The Banks To Face The Hangman

By Mike Whitney Officials in the Treasury Dept—-working with their colleagues at Citigroup, J.P. Morgan and Bank of America—have concocted a scheme to rescue the banks from their massive losses in mortgage-backed securities. The group is planning to set up a $100 billion emergency fund which will purchase non-performing assets for short term debt. In […]

Geneva Finance gets ratings downgrade

Geneva Finance has been downgraded by credit ratings agency Standard & Poor’s from B+ to B-. Standard & Poor’s director Gavin Gunning said the change reflected a sense that Geneva’s short-term liquidity and funding position was increasingly under pressure. “While Geneva continues to benefit from the demonstrable support of its primary bankers, the nature and […]

More debt better than more tax – National

Read this article and than watch the video “Money is debt” and you will understand why the National party, lead by an investment banker would say this. Maybe you will draw the conclusion like me that John Key is still serving his old masters: the money masters. He should of course be serving us, the people of […]

Half of NZ finance firms will go, says economist

Half of New Zealand’s finance companies are likely to disappear, according to ANZ/National Bank chief economist Cameron Bagrie. “I think we’re set for a real shake-out over the next 12 months,” he said. “The more marginal player is going to find it tougher,” he told the New Zealand Mortgage Brokers Association annual conference. “The weaker, […]

Millionaire’s factory in the spotlight as concern mounts

In Australia, Macquarie Bank is known as the “millionaires factory” for good reason. In the past 10 years, it has come from nowhere to become one of the world’s most aggressive buyers of airports, toll roads, energy firms and utilities. If an asset has a reliable cash flow, Macquarie, it seems, has pounced. In so […]

Credit Fuelled US Economy Becoming Like Soviet Union

Posted by Bill Bonner on Sep 28th, 2007 Now we’ve finally figured it out. We were sitting in a pub, listening to a crazy woman. All of a sudden, it was clear…what went wrong with the US economy, we mean.The dollar has dropped so low that America is becoming a shopping paradise for foreigners. Of […]

Borrowers told to lie about wages

  Some people have been advised to lie to buy a house A BBC investigation has found evidence of serious mis-selling in Britain’s sub-prime mortgage market. Industry insiders have described how people have been advised to lie about their incomes to take out loans far bigger than they can afford. Half of all sub-prime mortgages […]

Bacon and eggs served on toast to cost more

By Neal Wallace   Consumers already reeling from sharp milk and butter price rises are in for another shock as the cost of bread, bacon and eggs follow suit. Bread manufacturers are expected to increase the price of bread by up to 20 per cent before Christmas and will not rule out another price rise […]

Failed Lender Makes Grab for Employee Funds

Bankrupt American Home Mortgage is attempting to seize as much as $27 million that former employees set aside from paychecks for retirement, according to an attorney representing them. Employees say Melville, N.Y.-based American Home Mortgage Investment wants to release retirement money from a trust fund to pay off large creditors. The attorney for a group […]

Investor panic takes toll on Speirs Group

Palmerston North-based loss-making finance company Speirs Group says its investor roll has plummeted 35% in the past three months, its secured stock funding has reduced and it is grappling with the collapse of its rental car client. Speirs Group, made up of Speirs Finance, Speirs Nutritionals and Spiers Foods, posted a loss of $1.9 million […]

Prepare for prolonged turmoil, says US Treasury Secretary

From The Times September 18, 2007 Suzy Jagger and Gabriel Rozenberg Investors should brace themselves for a prolonged period of market turmoil, Henry Paulson, the US Treasury Secretary, said yesterday as he held emergency meetings with the Chancellor and the French Finance Minister. Mr Paulson flew to London to discuss the financial crisis with Alistair […]

Investors to blame for not assessing the risks

The United States is not the only nation confronting a household debt crisis. We, too, have a subprime lending market and it is managed by our collective bag of finance companies. The collective sum of savings at risk in this sector is reported to be $16 billion. Put another way, that’s nearly a third of […]

Greenspan: era of low inflation is over

Graeme Wearden and Ashley Seager Monday September 17, 2007 Guardian Unlimited Photograph: AP   Britain faces the prospect of falling house prices and rising inflation within a few years, according to Alan Greenspan, the former chairman of the Federal Reserve.In a series of interviews to promote his memoirs, the respected US economist warned that the […]

Cullen planned $1 billion in tax cuts

The Government planned to deliver $1 billion in personal tax cuts at the last budget, but shelved the plan due to fears it would fuel inflation, official papers show. The papers, issued under the Official Information Act, show the Government last year considered a package of personal tax cuts that would have equalled the $1 […]

Families feel pinch as basic costs rise

By PAUL EASTON – The Dominion Post | Tuesday, 18 September 2007AdvertisementHouseholds are being squeezed by price increases on basic foods and petrol, even before higher power prices and a sliding Kiwi dollar begin to take effect. Budgeting agencies fear the increase in staple food prices, including butter’s 23 per cent increase yesterday and milk’s […]

Credit crisis: Meltdown!

In the past 100 years, the rollercoaster ride that is the world of high finance has seen some spectacular lows. Sean O’Grady looks back at four episodes that not only came to define their times but also served as lessons for the future Published: 15 September 2007 1907: The Bankers’ Panic Sometimes, all that is necessary […]

Ailing lender’s checks bounce

By Jamie Smith Hopkins | Sun reporter September 15, 2007 Checks sent out by the troubled American Home Mortgage Investment Corp. to pay the property taxes of more than 70 homeowners in the Baltimore metropolitan area have bounced, local officials said yesterday. Baltimore City received bad checks for 53 properties – a total of about […]

‘Housing boom over’ as UK bank chaos grows

Economist warns of sharp downturn · Tory leader attacks Brown over crisis Heather Stewart and Lisa Bachelor Sunday September 16, 2007 The Observer Britain’s house price growth will be halved next year as the global financial crisis exacerbates the impact of rising mortgage rates, according to Nationwide, the biggest mortgage lender.After the dramatic bail-out of […]

Bankers fear £12bn run on Rock

September 16, 2007 David Smith, Grant Ringshaw and Holly Watt NORTHERN ROCK, the mortgage bank rescued by the Bank of England last week, could see as much as £12 billion – nearly half of its deposits – withdrawn by worried savers, experts say. The run on the bank continued yesterday as police were called in […]

House prices surge ahead of pay

The cost of buying a home has blown out to a record high. In August it took 81.6 per cent of a median weekly income to pay the mortgage on a median-priced house. That is more than twice the amount considered affordable, according to the latest Fairfax Media home loan affordability report. That makes the […]

US Economy Headed for Recession as Housing Bubble Bursts

Posted by Dr. Kurt Richebacher on Sep 14th, 2007 “America’s income-short, consumer-led recovery is the aberration – not the norm – in this Brave New World. It is all about ever-declining saving rates, ever-widening current account deficits, mounting debt burdens and increasingly wealth-dependent consumers. It personifies what I believe is one of the most precarious […]

Recession Time! The Housing Bubble Bursts the Economy

By Dean Baker     t r u t h o u t | Perspective    Tuesday 11 September 2007     The downturn in jobs reported last month by the Labor Department provided evidence of an economic downturn that even the economy’s greatest cheerleaders could not ignore. Healthy economies do not shed jobs.     During the core periods of the upturns […]