SOUTHERN CALIFORNIA SALES JUMP
October 21st, 2008Dataquick has announced that sales in Southern California jumped dramatically in September:
THE BAILOUT VERSION 2
October 13th, 2008
The Federal Government will buy approximately $125 billion of preferred stock in nine large banks in the first step of injecting $250 billion in banks across the country. Here are the key components of the plan:
WHAT TO LOOK FOR
October 13th, 2008If there is one key tool that will tell us when the credit crunch and problems in the financial markets are easing? It is the TED Spread. That is the gap between three-month US Treasuries (the risk free rate) and three month Libor (the rate at which banks lend to one another). Historically that rate has been a fraction of one percent. It spiked in September 2008 to over 2% and has increased since last month to well over 4%. A chart can be seen here. When this ratio declines it will be good news and when it it under 1% this crisis is likely nearing its end.
WORLDWIDE RATE CUT
October 8th, 2008
In response to the ongoing financial crisis, central banks from six countries have announced a joint interest rate cut:
THE CREDIT CRUNCH HITS MAUI
October 8th, 2008
We have been saying for several months that the direct impact of the issues facing the credit markets on Maui has been small. That is no longer the case.
WHAT DOES IT ALL MEAN IV
October 4th, 2008
Since the original 110 page Bailout bill couldn't get approved, Congress added 340 pages of tax cuts, tax breaks, regulatory changes and other assorted unrelated items to create the actual bailout bill. But the portion devoted to the bailout remains the same and is summarized here. Implementation has begun though it will take about a month for Treasury to devise auction rules, hire portfolio managers etc. In other important news, Wells Fargo has offered to purchase Wachovia for 15.4 billion. Wachovia had previously agreed to, with FDIC prompting, be sold to Citigroup for substantially less. It begs the question, if things are so bad, why would Wells Fargo pay so much more? The news on the economy was troubling this week as non-farm payrolls declined 159,000 in September. That's a number that indicates a recession. In fact Goldman Sachs is now predicting that the third quarter will show no economic growth at all and that a recession is likely. Finally, the rates for jumbo mortgages remain elevated and Libor, the rate at which banks lend money overnight to one another remains very high. So what does this all mean for Maui real estate?
