Eye of the storm

Anyone who thinks the economy has clear sailing ahead hasn't seen this chart of the ten year bond. There's been some talk that the United States might lose their AAA rating. Moody's assured investors by reaffirming their rating (sic) for U.S. government debt.

We're in the eye of the storm, friends. Time to pull in your rigs and head for dry land.

Comments

[bugsy]

for the last few months there has been considerable speculation as the the "shape" of the recovery. Various prognosticators have suggested that we could have a "L", "W" or "V" shaped recovery.

Last night I read that a Scottish economists is suggesting that we'll have a "square root" shaped recovery.

This made me laugh. If you graduated from high school hopefully you learned that the square root of "0" is zero.

[wilbur]

Residents interested in the Town of Barnstable’s 2010 budget can deliver their public comments via telephone.

The town manager’s office will be staffed to accept comments and questions, which will then be delivered to the council.

Call 508-862-4610 and tell John Klimm what a wonderful job he is doing spending your money.

[gone fishin']

Thought you might have an interest in this story:

12 pct. are behind on mortgage or in foreclosure
Delinquencies and foreclosures set record in 1st quarter, driven by prime loan defaults

NEW YORK (AP) -- A record 12 percent of homeowners with a mortgage are behind on their payments or in foreclosure as the housing crisis spreads to borrowers with good credit. And the wave of foreclosures isn't expected to crest until the end of next year, the Mortgage Bankers Association said Thursday.

The foreclosure rate on prime fixed-rate loans doubled in the last year, and now represents the largest share of new foreclosures. Nearly 6 percent of fixed-rate mortgages to borrowers with good credit were in the foreclosure process.

At the same time, almost half of all adjustable-rate loans made to borrowers with shaky credit were past due or in foreclosure.

The worst of the trouble continues to be centered in California, Nevada, Arizona and Florida, which accounted for 46 percent of new foreclosures in the country. There were no signs of improvement.

How's that 8.75% increase in water rates working out for you?

[bugsy]

From the CCT:

On the Cape, well-qualified borrowers now make up a significantly larger portion of those facing foreclosure than they did last year, said Nancy Davison, vice president of operations at the Housing Assistance Corp., a Hyannis-based agency that provides foreclosure prevention counseling.

"The folks we've been seeing for the last several months are not here because they have subprime mortgages," she said. "They're here because they lost their job or had a decrease in income."

Local community banks are seeing the number of delinquent loans on their books creep up.

As of March 31, borrowers were behind on nearly 3 percent of Cape Cod Cooperative's total loans, according to data from the Federal Deposit Insurance Corp.'s Uniform Bank Performance Report. At the end of 2006, only 0.1 percent of the bank's loans fell into this category.

At Rockland Trust, 0.32 percent of the bank's total loans were non-current at the end of 2006; by March 31 of this year, that number was up to 1.09 percent.

Seamens Bank's non-current loans went from 0.6 percent to 2.66 percent of total loans during the same period.

Rockland Trust declined to comment for this story. Calls to Seamens Bank were not returned.

Cape Cod Five's non-current loans edged up from 0.29 percent of the total to 0.56 percent between the end of 2006 and the end of March 2009.

Apparently, Hank's Bank isn't having any trouble:

At Bank of Cape Cod, which makes commercial loans almost exclusively, there has been no uptick in late payments, said president and CEO Tim Telman.

"Do we note that there's more stress out there, across the board? Absolutely," he said. "(But) we have not seen an increase in delinquencies."

[bugsy]

another blurb from the CCT:

From the beginning of 2007 through the end of April this year, 23,593 homes have been foreclosed upon in Massachusetts, with 1,106 of those in Barnstable County, according to The Warren Group, a Boston-based company that tracks real estate data.

Hyannis has one of the highest rates of foreclosure in the state, with approximately 2 percent of residential properties foreclosed on in 2008.

The trend is alarming, said Aglaia Pikounis, a spokeswoman for The Warren Group.

[bugsy]

Don't worry...I'll be removing this post in a few days.

I'm just waiting for the handful of idiots who have been harassing this blog to go away.

To answer the "I don't get it" question on CapeCog yesterday regarding this post, the chart foretold the following:

NEW YORK (Reuters) - A spike in U.S. mortgage rates drove down total home loan applications last week as demand for refinancing shriveled to the lowest level since November, the Mortgage Bankers Association said on Wednesday.

Borrowing costs have soared as bond yields have risen, even as the Federal Reserve has sopped up hundreds of billions of dollars in bonds to keep rates low and stimulate the housing market.

The average 30-year fixed mortgage rate jumped 0.32 percentage point in the June 5 week to 5.57 percent. That was nearly a full point above the record low rate of 4.61 percent in March, the trade group said.

The swift percentage point rise in mortgage rates cuts the purchasing power of a borrower by about 10 percent, he estimated.

"Employment is still bad, wages are still low, interest rates are up. That's going to hurt the housing market," said Goldman.

I didn't know if you have noticed, but there hasn't been much in the way of bridge traffic for the last three weeks. With mortgage rates, the price of oil, utilities and taxes on the rise, it will be a FEW years before real estate and employment opportunities on the Cape improve.