Thousands of investors hit hard

The investments of many of the 380,000 people who have joined the KiwiSaver scheme have taken a battering with the dramatic slump in sharemarkets. New Zealand and world sharemarkets have taken a dive in the past fortnight after falls in the United States. Fears of a recession there and massive losses in US housing markets […]

The Subprime/Securitization Market Panic

A Guide for the Perplexed Larry Peterson This article is from the November/December 2007 issue of Dollars & Sense: The Magazine of Economic Justice available at Subscribe Now at a 30% discount. This is a web-only article. For more coverage of the current financial crisis, see the November/December 2007 issue of Dollars & Sense […]

Borrowers stretched to the limit

In 24 years as president and chief executive officer of Sacramento’s Safe Credit Union, Henry Wirz said he’s never seen such “widespread credit problems in the Sacramento region.” It began last September with rising delinquencies on car loans. By December, the late payments spread to real estate loans. Now, increasingly, borrowers have maxed out their […]

Update: Crash! Biggest fall in shares since September 11

Recession fears wipe £84bn off the value of Britain’s biggest companies as stock markets tumble across the globe By Nick Clark Published: 22 January 2008   It was the day that the fear factor took over. From Asia to South America, share prices tumbled yesterday as the world’s investors gambled that a US recession was now […]

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 […]

ARM Teaser Freezer Plan Designed To Help Banks, Not the Market

So it was that Henry Paulson came up with an idea… the ‘teaser freezer‘ plan. The ARM teaser freezer is being sold to the public as a way to protect homeowners. But it has another purpose, says a reporter from the San Francisco Gate, to help save the banks from their own bad judgment. “The […]

Bank loan funding costs at 10 year peak

The Good Returns mortgage rate table is awash with red this week as lenders push rates up even though there has been no change in the official cost of borrowing in New Zealand. A general re-pricing of home loan rates appears to be underway, with increases from some banks of up to 30 basis points, […]

The Fat Cats Protection League

Wherever you hear the words “free market”, you’ll find massive state handouts to corporations By George Monbiot. Published in the Guardian 4th September 2007 After my column last week, several people wrote to point out that the neoliberal project – which demands a minimal state and maximum corporate freedom – actually relies on constant government […]

Credit Crisis Worse Than Long-Term Capital Management Collapse in ’98

Posted by Marc Faber on Sep 20th, 2007 Unlike all the Wall Street strategists who compare the current credit crisis to the credit crisis of 1998 (Long Term Capital Management), I believe that the ongoing credit problems will be far worse and of a longer-term nature. This will make it difficult for the market to […]

Fed to meet for US rate decision

The Federal Reserve is preparing to meet to decide whether US interest rates should be reduced from 5.25%. Most analysts believe the Fed will cut rates to try and prevent a housing market downturn and the credit crunch from severely denting the economy. By making money cheaper to borrow, people would spend and invest more, […]

The Supply-Side Fraud: Republican Economics Don’t Work

By Hale Stewart, Posted September 10, 2007.Supply-side economics is a great marketing concept, but in reality is a poor national policy. Tools Republicans are enamored by “supply-side” economics. Frankly, I have to admit it’s a very easy sell. Think about it. “Cutting tax rates stimulates the economy to such a high level that tax […]

Central bankers warn housing crisis could hit whole US economy

BASEL, Switzerland (AFP) – The crisis in the US housing market risks spreading to the whole of the nation’s economy, European Central Bank chief Jean-Claude Trichet said Monday on behalf of world central bankers.Trichet was speaking in his capacity as head of the G10 group of central bankers from industrialised and emerging economies, who met […]

Countrywide to cut up to 12,000 jobs

Fri Sep 7, 2007 7:39PM EDT NEW YORK (Reuters) – Countrywide Financial Corp, the largest U.S. mortgage lender, said on Friday it plans to cut 10,000 to 12,000 jobs to cope with weak housing demand, rising foreclosures and tightening credit markets. The cuts, which amount to as much as 20 percent of the lender’s work […]

Are The Banks In Trouble?

By Mike Whitney      “The new capitalist gods must love the poor – they are making so many more of them.” Bill Bonner, “The Daily Reckoning”   “The hope of every central bank is that the real problem can be kept from public view. The truth is that the public—even professionals on Wall Street—have no […]

Reserve Bank of Australia Plans Loans for Distressed Lenders

Posted by Dan Denning on Sep 6th, 2007 Who is knocking on the door of the Reserve Bank of Australia, looking for a handout? The Bank issued a press release this morning, telling anyone who would listen that, “it has decided to further widen the range of securities eligible for its repo operations.” As of […]

House prices in some areas may fall as much as 50%

By Finfacts Team Sep 3, 2007, 07:01 US homes may lose as much as half their value in some US cities as the housing bust deepens, according to Yale University professor Robert Shiller. Meanwhile, Martin  Feldstein of Harvard University says that experience suggests that the dramatic decline in residential construction provides an early warning of […]

The Real Cost of a Picket White Fence: 3 Housing Factors to Think About; Prices set at the margin, income discrepancies, and bubble euphoria.

After drinking water out of the bailout fire hydrant, I think most people are scrambling to get an idea of what is happening. An issue placed on the back burner by many politicians is suddenly garnering massive media playtime. Amazingly, Americans in a large percentage are against any bailout talks or consideration. The nationwide MSNBC […]

The Predicted Financial Storm Has Arrived

By Gabriel KolkoContradictions now wrack the world’s financial system, and a growing consensus exists between those who endorse it and those who argue the status quo is both crisis-prone as well as immoral. If we are to believe the institutions and personalities who have been in the forefront of the defense of capitalism, we are […]

U.S. at risk of recession from housing

By Mark Felsenthal and Alister Bull JACKSON HOLE, Wyoming (Reuters) – The weak housing market could topple the country into a full-blown recession and the Federal Reserve should slash interest rates aggressively, one of the country’s most prominent economists warned on Saturday. “Lower interest rates now would help,” Martin Feldstein, president of the influential National […]

Economist eyes home value dive: Others skeptical of 50 percent decline

By Edward B. Colby Saturday, September 1, 2007 – Updated: 08:38 AM ESTThink the subprime mortgage meltdown was frightful? Now consider the prospect of your home losing half its value. An esteemed economist suggested yesterday that “real home prices” in some parts of the country could drop by as much as 50 percent, posing yet […]

Australian Trade Deficit Grows: It’s Bad To Owe More Than You Own

Posted by Dan Denning Leaderless, directionless, and clueless. That’s how we’d describe the state of the local and global market. The problem is the “known unknowns” (US$43 billion of them) and those pesky “unknown unknowns” (credit derivatives). More on that below.First, did you see the current account deficit widened to nearly AU$16 billion in the […]

Hostile Takeover: The Corporate Control of Society and Human Life

by Stephen Lendman Large transnational corporations are clearly the dominant institution of our time. They’re preeminent throughout the world but especially in the Global North and its epicenter in the US. They control or greatly influence what we eat and drink, where we live, what we wear, how we get most of our essential services […]

The social toll of the US home mortgage crisis

Part 1 By Andre Damon 31 August 2007 The following is the first in a two-part series. Home foreclosures in the US have reached near-epidemic scope and scale. In Detroit, there was one foreclosure filing for every 97 households in July alone, according to, the largest database of foreclosed properties. Michigan, Georgia and California […]

Why The Bursting of the Housing Bubble Will Bring About the Modern 1930s

Thomas Au is author of “A Modern Approach to Graham & Dodd Investing.” This article was previously published on’s “Street Insights.” *The bursting of the housing bubble means that band-aid has been ripped off the country’s Achilles heel, the cash-strapped average American consumer. * The resulting two-decade pullback in living standards would represent “the […]

Economic Armageddon Is Coming – The Market Oracle

Economics / Global Financial System Apr 24, 2007 – 12:50 PM By: Joel. S. Hirschhorn Stop being a compliant consumer. Face the ugly truth. Don’t get fooled by the stock market. Accept the need for the mistreated middle class to become the revolutionary class. The British military establishment’s most prestigious think tank sees what too […]

US Dollar Warning – This is going to dramatically affect you …

Larry Edelson writes: By every measure under the sun, the dollar is getting creamed, just like I told you it would. It recently hit a 25-year low against the British pound … a record low against the euro … a 12-year low against the Thai baht … and a seven-year low against a third-world currency, […]

Financial Bankruptcy, the US Dollar, and the Real Economy

by Rodrigue Tremblay / August 22nd, 2007 The U.S. government is on a ‘burning platform’ of unsustainable policies and practices. – David Walker, U.S. Comptroller General Modern society, based as it is on the division of labor, can be preserved only under conditions of lasting peace. – Ludwig von Mises, Austrian economist People know that […]