The Federal Reserve’s rescue has failed

The verdict is in. The Fed’s emergency rate cuts in January have failed to halt the downward spiral towards a full-blown debt deflation. Much more drastic action will be needed.   The Federal Reserve building in Washington Read more from Ambrose Evans-Pritchard ‘Ninja’ loans explode on sub-prime frontline The latest news and views on the […]

After subprime debacle, U.S. wrestles with question of bank bailouts

John Key was working for banks who were at the forefront of those who developed these fantastic new financial innovations. He worked for the Bankers Trust; one of the first banks that started to experiment with these funky new “securitized investment vehicles”. In fact while working for Merrill Lynch he worked for a while as […]

Another finance company hits wall

A 15th finance company has hit the wall and is asking its debenture holders to vote on a 20-month wind down to stop it from going to the receivers. New Zealand property finance firm MFS Boston, an indirectly owned subsidiary of troubled Australian firm MFS, announced the moratorium proposal yesterday and will hold a meeting […]

Wall St. Banks Confront a String of Write-Downs

Wall Street banks are bracing for another wave of multibillion-dollar losses as the crisis that began with subprime mortgages spreads through the credit markets. In recent weeks one part of the debt market after another has buckled. High-risk loans used to finance corporate buyouts have plummeted in value. Securities backed by commercial real estate mortgages […]

MORTGAGE MELTDOWN

Interest rate ‘freeze’ – the real story is fraud Bankers pay lip service to families while scurrying to avert suits, prison Sean OlenderNew proposals to ease our great mortgage meltdown keep rolling in. First the Treasury Department urged the creation of a new fund that would buy risky mortgage bonds as a tactic to hide […]

The Mortgage Mogul and His Victims

As banks, money markets and stock exchanges convulse over a sinking American economy, we see the folks sprawled at the bottom of the smoking rubble — debt-crushed American consumers. It is they whose reckless or trusting natures enriched so many, at least for a while, and whose troubled loans have sent markets into panic. But […]

Udate: US recession fears wipe £77bn from London shares

London’s FTSE 100 fell to an 18-month low as markets took a dim view of President Bush’s plan to fight off a US downturn Patrick Hosking and Leo Lewis About £77 billion was wiped from UK blue chip share values this morning as fears of a US recession reverberated around the globe, sending the FTSE […]

Chinese shares close more than 5% lower

    BEIJING, Jan. 21 (Xinhua) — Chinese shares plunged more than 5percent on Monday, as investors dumped stocks amid liquidity concerns sparked by the huge share sale plan of Ping An Insurance.     The benchmark Shanghai Composite Index, which covers both A and B shares, tumbled 266.08 points, or 5.14 percent, to 4,914.44, while the Shenzhen Component […]

US subprime lenders targeted blacks, poor: report

WASHINGTON (AFP) — US mortgage lenders targeted minorities and people with low incomes in recent years as the “best candidates” for subprime home loans, with devastating economic consequences, a report claimed Tuesday. The report by the United for a Fair Economy (UFE) advocacy group said subprime mortgages, home loans issued to Americans with scant finances, […]

US credit crisis pushes up NZ mortgages

The US credit crunch has finally hit New Zealand home-buyers directly in the form of rising mortgage rates. Westpac yesterday raised its fixed rate mortgages by 20 points, taking its two-year fixed rate from 9.4 per cent to 9.6 per cent. The increase matches moves by New Zealand’s largest bank, ANZ National, within the last […]

Top economist says America could plunge into recession

From The Times December 31, 2007 Suzy Jagger in New York Losses arising from America’s housing recession could triple over the next few years and they represent the greatest threat to growth in the United States, one of the world’s leading economists has told The Times. Robert Shiller, Professor of Economics at Yale University, predicted […]

Report: Bonuses paid for dropping sick patients

John Key stated that if elected National would promote privatised care for the elderly.(Travellerev)  A health insurance company serving customers in a half-dozen states set out to drop hundreds of customers and paid lucrative bonuses to an executive in charge of eliminating coverage. One customer is suing the company, Health Net Inc., after a company salesman […]

Doctor, doctor: How can you justify a 10% pay increase

According to John Key Doctors prices would level out and the market would determine the price doctors could charge for a consult when the consult fees would be up to the doctors. I wonder if this is what John Key had in mind? GPs’ salaries soar to £110,000 despite promises of more money for patients By […]

US home sales hit fresh lows as unsold properties flood market

WASHINGTON (AFP) – Sales of US homes and apartments tumbled a hefty eight percent in September extending one of the nation’s worst housing slumps in decades, an industry group said Wednesday. The National Association of Realtors said in a monthly snapshot that sales of existing homes and apartments fell to a seasonally adjusted rate of […]

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 […]

Children’s homes hit by buyout fears

John Key and National anyone ? Concern at private equity’s role in social services Nick Mathiason, business correspondent Sunday October 14, 2007 The Observer The collapse of a private equity-backed care home dealing with sexually abused and autistic children has sparked renewed concern at the advance of financial buyers into British public services. Sedgmoor, owned by […]

The selling off of Canada. Will we bemoan the selling of of New Zealand when National starts to sell our assets.

At what point does Canada become a toy country? In August, the last of the major Canadian steel makers was sold to United States Steel Corporation for $1.1 billion. Earlier, Dofasco was sold to a European company which has since been swallowed up by Mittal Steel Co. of India. This latest foreign takeover is just […]

US Housing Crisis: Why Real Estate is Always a Wasting Asset

Meanwhile, speaking of housing, there are a lot of long faces among house sellers this morning. According to the weekend news, the story just becomes more and more depressing. “American Dream turns to a Nightmare,” begins the report in the Arizona press. (A modest suggestion to financial journalists: find a better headline. We’ve read that […]

Sub-prime crisis: Is it over?

When the sub-prime crisis rocked world markets on July 27, New Zealand’s sharemarket followed the same dismal path as Wall Street. It sank almost 10 per cent in less than a month. But the NZX-50 index stopped just short of a fresh closing high on Tuesday and overseas markets have also recovered. The sorry episode […]

Lending shock in Five Star collapse

Investors in Five Star Consumer Finance may get as little as a quarter of their $51 million back, after receivers reported big loans that appeared to be “outside normal lending practices”. Receiver Richard Agnew said certain matters would be referred to the “appropriate Government authorities” for investigation, but would not elaborate. In another, unrelated, shock […]

Credit rut endures as markets struggle

Hopes that global credit markets might be coming unstuck were derailed yesterday after a spike in key European bank lending rates and data on United States commercial paper suggested the lending drought is persisting. The sense of lingering trouble was reinforced by actions from central banks in the US and Europe, which were forced to […]

The Maestro of Misery: Greenspan’s Dark Legacy

By STEPHEN LENDMANAfter retiring as the Federal Reserve’s second longest ever serving chairman, Alan Greenspan is now cashing in big late in life at age 81. He chaired the Fed’s Board of Governors from the time he was appointed in August, 1987 to when he stepped down January 31, 2006 amidst a hail of ill-deserved […]

The Worst Recession in 25 years?

By Robert P. Murphy Posted on 10/1/2007 [Subscribe or Tell Others] << Previous Story | Index | Next Story >> On September 18 the Fed cut its target for the fed funds rate by 50 basis points (0.5 percentage points), from 5.25% to 4.75%. The move surprised many analysts who had been expecting a more […]

Corporate plan for classrooms

A multinational company specialising in public-private partnerships (PPPs) could become a school landlord under National’s education plans. Yesterday, National unveiled more detail on its education policy after The Weekend Press revealed the party was planning to pump more money into private schools and allow the private sector to build and own state schools. The story […]

“A fresh blow to the housing market ,” is how the Financial Times describes it.

“A fresh blow to the housing market ,” is how the Financial Times describes it. The Daily Telegraph comes up with a more bodacious headline: “US housing market in freefall as prices crash” And follows up with this: “Sales of new homes in the US plunged in August at the fastest rate since modern records […]

Credit crisis strikes UBS, Citi, Credit Suisse

By Andrew Hurst and Christian Plumb ZURICH/NEW YORK (Reuters) – The credit crisis struck at the heart of the global financial industry on Monday as Swiss bank UBS AG said it faced a shock loss in the third quarter and Citigroup warned its profits had collapsed. UBS’s chief domestic rival Credit Suisse Group also said […]

Kiwibank’s $6m in troubled Northern Rock

Taxpayer-funded Kiwibank has invested around $6 million in troubled British lender Northern Rock, which was last week bailed out by the Bank of England. Spokesman Bruce Thompson confirmed the government-owned entity holds around $6 million in bonds issued by Northern Rock. Kiwibank was “very confident” its investment was safe, he said. “We’ve got a very […]

Mortgages cause sleepless nights for homeowners

Home owners are becoming increasingly uneasy about keeping up with their mortgage repayments, a Research New Zealand survey says. The poll found home loan interest rates were a concern for 68 per cent of those with mortgages. The survey of social attitudes asked those with home loans if they were concerned that rising mortgage interest […]

Rent rage in tight housing market

One in four New Zealand tenants suffer from “rent rage” – and the phenomenon is set to grow as more people are shut out of owning their own home. According to a national survey by property website allrealestate.co.nz more than half of the 170 online respondents expressed “anxiety” over their rental predicament, with rising rents […]