Archive for February, 2009
A mere three percent of lenders believe that TARP will have a "meaningful" impact on their lending practices, according to Phoenix Management's "Lending Climate in America" survey, released Thursday. Fifty-five percent of respondents opined that the TARP would have a "modest impact" on lending. Thirty-six percent believe the TARP will have "minimal impact", while the remaining six percent of respondents believe the TARP will have absolutely "no impact" on lending.
Since TARP's implementation, banks have been slammed for not using TARP funds to make loans. Many banks have chosen to utilize TARP funds primarily to shore up their balance sheets — one of the mechanisms intended by the Treasury, but one that has been questioned, indeed.
"I agree that Secretary Paulson, whom I generally admired, made a mistake in not pushing them to do more lending," said House Financial Services Committee chairman Barney Frank to U.S. News Monday. "I think you're going to see the Obama administration, having learned from that, push for more lending. There are going to be some rules in there." The Obama administration's financial bailout plan is expected to include valiant efforts to boost lending practices.
According to the survey, lenders' long-term outlooks of the economy's performance fell to a "D" expectation level – the lowest level in the 13-year history of the quarterly survey. An overwhelming majority – 91 percent – designated the reduction in consumer purchasing power as the economic issue borrowers are most concerned with in the near term.
Michael Jacoby, Managing Director and Shareholder of Phoenix Management Services, said 83 percent of respondents believe the bottoming out of the residential housing market will be the most important factor that will assist the U.S. in recovering from this recession. When asked to identify the two most important factors, 31 percent selected the flow of credit to long-term mortgages. Twenty-seven percent of lenders chose the Obama administration and other factors.
The percentage of respondents with customers having no growth expectations over the next 6 to 12 months continued to rise significantly from recent quarters to 78 percent – the highest level recorded in this survey in the last eight years. Twenty-two percent of lenders said their customers had moderate growth expectations, down from 49 percent in the previous quarter.
The percentage of lenders expecting to tighten their existing loan structures increased to 65 percent, compared to 47 percent in the previous survey. As a result, the percentage of respondents planning to maintain their loan structure fell to 35 percent, versus 53 percent in the previous survey.
Write to Kelly Curran at kelly.curran@housingwire.com.
Disclosure: The author held no relevant investment positions when this story was published. Indirect holdings may exist via mutual fund investments. HW reporters and writers follow a strict disclosure policy, the first in the mortgage trade.
First-time applications for state unemployment benefits surged 35,000 to a seasonally-adjusted 626,000 in the week ending Jan. 31, the Labor Department said Thursday, posting a 26-year high.
"[W]e're starting to get used to these awful numbers, so it doesn't have quite the shock value that it once had, but it's not going to create any buying, that's for sure," Frank Lesh, futures analyst and broker for Futurepath Trading LLC, told Reuters.
The total number of Americans receiving state jobless benefits rose 20,000, reaching a record 4.79 million in this reporting period. And the four-week moving average of new jobless claims, which can sometimes smooth volatility, jumped a whopping 44,000 to 4.67 million.
The largest increases in initial claims were in Wisconsin — where 1,355 people filed a claim in the week ending Jan. 24 — Rhode Island, Virginia, Oklahoma and Puerto Rico. The largest decreases in first time claims were seen in Florida — dropping by 14,703 — California, Michigan, Georgia, and Ohio.
Despite the Labor Departments ongoing warning in recent weeks that unemployment data was likely to continue its rise, the latest week's numbers are still higher than many analysts expected. Analysts polled by Reuters forecasted 585,000 new claims , while Bloomberg's survey predicted claims would fall to 580,000.
It seems companies are still cutting costs to compensate for weak sales, and might continue to do so. Data released Thursday by the Labor Department shows as firms are cutting back on employees' hours, output is suppressed, but productivity growth is rising. Productivity is output divided by hours worked. Productivity gains are supposed to be the key to higher living standards, higher wages, increased profits and low inflation.
During the fourth quarter of 2008, hourly compensation climbed a record 15.6 percent as inflation moderated.
Write to Kelly Curran at kelly.curran@housingwire.com.
As President Barack Obama called for "basic common sense" regarding executive pay Wednesday, the Treasury Department was announcing a campaign of measures to limit the compensation of top executives at institutions that receive government funds through the Troubled Asset Relief Program. "The Treasury guidelines on executive pay seek to strike the correct balance between the need for strict monitoring and accountability on executive pay and the need for financial institutions to fully function and attract the talent pool that will maximize the chances of financial recovery and taxpayers being paid back on their investments," Treasury officials said in a media statement regarding the restrictions.
Any firm designated as needing "exceptional assistance" — or TARP funds beyond what's reasonably accessible to other institutions, usually through bank-specific agreements with the Treasury — will be subject to strict regulations regarding executive compensation and company expense. The Treasury will require the institutions to limit the annual compensation of senior executives to $500,000, other than restricted stock, with any additional pay made in the form of restricted stock that vests when the government has been repaid the bailout funds with interest. The top five seniors of the firms are currently restricted from receiving any golden parachute payment upon severance from employment, "a ban that will be expanded to include the top 10 senior executives" with the new rules, which also require the companies to adopt a strict policy toward extra expenditures "related to aviation services, office and facility renovations," (ahem — John Thain) "entertainment and holiday parties, and conferences and events."
Other institutions participating in generally available capital access programs will face similar restrictions, though they will be allowed to waive their $500,000-plus-restricted-stock limitation on executive pay so long as they publicly disclose their compensation policies. Beyond such restrictions, Treasury officials urged further steps to examine how compensation strategies at these — "not just those related to top executives" — may have encouraged risk-taking behaviors that contributed to current market events. The Treasury also urged the development of "model compensation policies," which should include a requirement that all public financial institutions, not just those receiving TARP assistance, publicly disclose compensation information and work toward implementing compensation incentives with a "long term perspective" on the health of the institution and the recovery of the market.
Examples of firms receiving "exceptional assistance" include American International Group (AIG: 25.25 +0.44%), Bank of America Corp. (BAC: 7.29 -0.14%) and Citigroup Inc. (C: 30.87 +1.61%) under the Systemically Significant Failing Institutions and Targeted Investment programs. These restrictions will be imposed on institutions going forward, but not applied to institutions with contracts that have already been reached, according to the Treasury.
Read the Treasury's announcement.
The compensation and bonus policies at major financial firms receiving TARP funds have come under increasing criticism from the media and even the President, who on Saturday told the nation he had "learned this week that even as they petitioned for taxpayer assistance, Wall Street firms shamefully paid out nearly $20 billion in bonuses for 2008…. [T]he American people will not excuse or tolerate such arrogance and greed. The road to recovery demands that we all act responsibly, from Main Street to Washington to Wall Street."
Despite Obama's plea for "transparency, rigorous oversight, and clear accountability," from Wall Street CEOs, the days that followed his Saturday address revealed damning tax errors of yet two more of his nominees. Treasury secretary Tim Geithner had already come under fire for his failure to pay some $30,000+ in taxes while he was employed at the International Monetary Fund. Even in light of the criticism he faced over the flub, Geithner's nomination was approved. For nominees Nancy Killefer and Tom Daschle, however, tax flubs would be the undoing of their nominations. Killefer asked on Tuesday for the withdrawal of her nomination for chief performance officer. Daschle also withdrew his nomination for head of the Department of Health and Human Services, and soon after Obama appeared on several televised media outlets, apologizing for the nomination mistakes.
While recovering from embarrassing nomination flubs, the administration is reportedly also in discussion about a forthcoming bank rescue plan, rumored to involved from $1 to $2 tillion in additional spending after the TARP and the financial stimulus bill being picked apart in Congress. Geithner is reportedly in discussions to refocus on assets through the TARP. Sources told Bloomberg the Treasury and the Obama administration are moving away from a federally-regulated "bad bank" to hold toxic securities, and toward a measure to guarantee illiquid assets against potential losses while still held on bank balance sheets.
Write to Diana Golobay at diana.golobay@housingwire.com.
Disclosure: The author held no relevant investment positions when this story was published. Indirect holdings may exist via mutual fund investments. HW reporters and writers follow a strict disclosure policy, the first in the mortgage trade.
Freddie Mac (FRE: 0.00 N/A) said Tuesday that it is piloting a third-party servicing program for Alt-A and other at-risk nonperforming mortgages, called the Workout Strategy for High Risk Loans, that will see Freddie place certain loans with special servicers in an effort to implement more aggressive loss mitigation strategies. The move comes as some traditional mortgage servicers have run into problems quickly and completely implementing the recently-announced streamlined modification program, sources at various key banks have suggested to HousingWire.
The streamlined modification program (SMP), announced on Nov. 11 of last year, is aimed at borrowers who have missed three payments or more, own and occupy their primary residence, and have not filed for bankruptcy. Critics have suggested the bulk modification effort will encourage borrowers to default on their mortgages, in order to obtain favorable interest rates and possible principal reduction on their mortgages. See earlier story.
But implementing the bulk modification program has proven to be a more difficult task than most expected when the program was first announced, particularly among some of the larger servicing platforms, forcing both Freddie and sister GSE Fannie Mae (FNM: 0.00 N/A) to extend previously-announced freezes to evictions through the end of February.
"We're talking about changing the nature of the loss mitigation process, and we're asking already overtaxed and perhaps oversized servicers to change their process and staffing on a dime," said one source, a banking executive who asked not to be named in this story. "It sure looks like Freddie is exploring the idea of moving the most at-risk assets to other shops set up specifically to handle that kind of work."
While Freddie Mac did not address any particular reason for rolling out the pilot servicing and loss mitigation program, and didn't specify if the program involved moving loans from one servicing shop to another, senior vice president of default asset management Ingrid Beckles did hint that existing servicers may not have adapted as quickly to the new requirements as the GSE or its regulators had hoped.
"A workout strategy is only as successful as the number of knowledgeable counselors available to answer the phone," she said in a statement. "Our strategy for high risk loans is designed to help servicers cope with today's unprecedented call volume by directing calls to a specialist with the specific staff and technical resources for handling a high volume of borrowers with these types of mortgages."
Under the new pilot, a selected portfolio of higher risk mortgages that are at least 60 days delinquent will be given to a specialty servicer for what the GSE characterized as "intensive attention," including the use of the streamlined modification program.
Ocwen Financial Corporation (OCN: 13.96 +1.53%) is one of the servicers Freddie Mac has selected for the pilot, the GSE said; the subprime servicer has made headlines in recent months for comparatively heavy loan modification activity among the loans it services. Ocwen will deploy teams of specially trained counselors to handle Freddie Mac's delinquent high risk mortgages in order to minimize telephone wait times, put borrowers in touch with live counselors faster, and implement the latest Freddie Mac foreclosure reduction policies more quickly, according to a press statement.
"If that isn't telling a mega-servicer to get their act in gear or risk seeing loans walk out the front door, what is?" said one servicing executive at a third-party servicing shop that is also participating in the Freddie Mac pilot program, under condition of anonymity.
Initially, the pilot will target an estimated 5000 reduced documentation loans from California, Nevada and other states with high delinquent rates. Although Alt-A loans were made to borrowers with strong profiles and represent a fraction of Freddie Mac's single family portfolio, they account for half of the GSEs' seriously delinquent mortgages.
Freddie Mac plans to determine whether to broaden or modify the strategy after reviewing the pilot's June results, it said.
Write to Paul Jackson at paul.jackson@housingwire.com.
Disclosure: The author held no relevant investment positions when this story was published. Indirect holdings may exist via mutual fund investments. HW reporters and writers follow a strict disclosure policy, the first in the mortgage trade.
In recent months, 300 to 400 foreclosed homes come up for sale each week in Michigan's Wayne County. And as of Monday, that will no longer be the case.
"Today I will be stopping all mortgage foreclosure sales in Wayne County, beginning with the sale that was scheduled for this Wednesday," said Wayne County Sheriff Warren Evans in a statement earlier this week.
While some experts question Evans' authority to enact such a measure, the sheriff argued that he has the power and obligation, under the Troubled Asset Relief Program — which according to Evans, trumps state law — to halt foreclosure sales until "efforts to modify the mortgages of homes covered by TARP have been exhausted." Because once a foreclosure sale is complete, homeowners lose their rights to the property.
Tricia Raymond, a foreclosure expert and buyer's agent in Troy, Mich., told the Detroit Free Press that she doubted the effectiveness of the sheriff's proposal given the high unemployment rate in Michigan. "It's one thing to work something out with someone, but if they don't have a job there's not anything to work out," Raymond said.
Nonetheless, Evans said "I cannot in clear conscious allow any more families to lose their homes through foreclosure sale until I'm satisfied they have been afforded every option they are entitled to under the law to avoid foreclosure."
He's additionally concerned that the large number of vacant homes in Wayne County will become a public safety issue. Studies show that vacant homes are often the target of theft, drug dealing and much more. In his statement Monday, Evans said his office will work with lenders and homeowners to make sure homeowners are provided every viable option to avoid foreclosure, as he believes "very few homeowners have been able to avail themselves" of options that are now available. He urged all other Michigan sheriffs to join in implementing a moratorium on foreclosure sales, as well.
Although sheriffs in two other neighboring counties, Oakland and Macomb, told the Detroit Free Press they appreciated Evans' position, both said they would not change how their counties manage foreclosures without new guidelines from the state.
What is perhaps odd about the latest foreclosure brouhaha is the fact that a foreclosure sale in the state prompts a six-month redemption period under Michigan law, during which a homeowner can reclaim the home by making up payments to the lender. If the homeowner doesn't make the payments, the bank can repossess the home. However, the lenders must have a sheriff's sale to begin the redemption period.
"I think he's just trying to get votes," John Graham, a realtor with Keller Williams, told the Detroit free press of Evans decision to halt foreclosure sales. Evans is set to run for Detroit mayor.
Write to Kelly Curran at kelly.curran@housingwire.com.
Disclosure: The author held no relevant investment positions when this story was published. Indirect holdings may exist via mutual fund investments. HW reporters and writers follow a strict disclosure policy, the first in the mortgage trade.
The unprecedented economic conditions facing the nation are increasingly straining the ability of cities to meet their financial needs, according to a study released Wednesday by the National League of Cities. Precipitous drops in home prices have helped drain cities of much-needed tax revenue, leaving 84 percent of cities surveyed facing fiscal difficulties, up from 64 percent only 6 months ago, the group said. The 84 percent figure is the highest percentage in the history of NLC’s surveys, dating back to 1985.
Not surprisingly, almost all cities responding expect the current economic hardship to continue well into 2009. 92 percent of the cities surveyed expected to have trouble meeting their city needs during this year, and are implementing hiring freezes and layoffs, delaying capital expenditures and instituting service cuts.
“Cities are responding as best they can,” said Donald J. Borut, executive director, NLC. “Their citizens have increasing needs for services just at the same time that revenues are declining. Cities are implementing creative solutions and making very difficult decisions amid rapidly changing economic circumstances.”
City finances tend to lag the overall economy by 12 to 24 months — which means that the degrading economic conditions seen during the fall months will be felt by cities through 2009 and likely through most of 2010, as a result.
Write to Paul Jackson at paul.jackson@housingwire.com.
As the ailing economy tightens homeowners' wallets, for most, now isn't the time to make-over the kitchen, install new wood floors or even replace those chipped baseboards. That fresh paint job just might have to wait, and those out-dated fixtures in the bathroom, well, what's another couple years? As a result of the downturn in home improvements, the remodeling industry has hit a near standstill, similar to what we've seen in home building.
"Like the overall housing market, the US home improvement industry is mired in a severe downturn," said a report from the Joint Center for Housing Studies at Harvard University, released Wednesday. However, the study predicts the correction in the remodeling industry "should be much less severe" than in home building, for a few reasons.
For starters there is a continued interest in "greening" America's homes to make them more energy efficient, as consumers search for a means to lower energy bills. According to the Harvard study, homeowners spent over $52 billion of their improvement expenditures on energy-related projects, up from the inflation-adjusted figure of $33 billion a decade earlier.
Then, there is the need for rental repairs. The rental housing stock is in "dire need" of improvement after years of underinvestment, the report explained. During the housing boom, weak demand for rentals discouraged owners from upgrading their properties. Not to mention, rental properties are 36 years old on average. The report also said the increasing number of immigrant homeowners will contribute to a rise in remodeling.
"Not only do immigrants represent a growing share of new household formations, but they are also very active in the improvement market," the study said. "Immigrants are younger households, heavily concentrated in their 30s and 40s — the ages when families are growing and changing the uses of their homes, and therefore the ages when homeowners begin to spend more on remodeling."
Remodeling may also reap benefit from — oddly enough – the wave of foreclosures currently underway. Foreclosed home are often times abandoned or vandalized; and therefore, will need rehabilitation as the housing market begins to recover. Areas where foreclosure rates are high may therefore see a resumption of home improvement spending as markets turn upward. Cognizant of this potential need, the Housing and Economic Recovery Act of 2008 has actually allocated $4 billion to state and local governments for the redevelopment of abandoned and foreclosed properties.
There is no doubt the remodeling industry is struggling to date, but "the foundation of the remodeling industry is solid," according to the report. And when the housing market takes to the road of recovery, the "future growth in home improvement activity is assured."
It's possible the remodeling market may even come out stronger than it was before. "The residential supply chain…now more fully understands the benefit of serving the remodeling sector as a strategy for balancing out construction cycles," explained the report's authors. "Focusing on this customer base and assisting remodeling contractors in improving their operations will help to create a more professional industry."
Write to Kelly Curran at kelly.curran@housingwire.com.
Disclosure: The author held no relevant investment positions when this story was published. Indirect holdings may exist via mutual fund investments. HW reporters and writers follow a strict disclosure policy, the first in the mortgage trade.
The non-farm private employment sector shed a seasonally-adjusted 522,000 jobs from December 2008 to January 2009, according to the monthly report published Wednesday by Automatic Data Processing, Inc. (ADP: 55.34 -0.86%) and conducted from study of business payroll information.
Non-farm private employment in the services-providing sector fell by 279,000 in the month, while employment in the goods-producing sector continued in its 24th consecutive monthly decline (243,000 in January). Employment in the manufacturing sector contracted by 160,000 jobs, its 28th decline in 29 months, according to the ADP data.
Large businesses with 500 or more workers reported shedding 92,000 jobs, while medium-sized businesses with staffs between 50 and 499 workers shed 255,000 jobs. Small businesses with fewer than 50 workers lost 175,000 jobs in January, according to the data. Construction employment fell for the 22nd consecutive month, bringing total construction jobs lost to 923,000 since the peak in January 2007.
"Sharply falling employment at medium- and small-size businesses clearly indicates that the recession continues to spread well beyond manufacturing and housing-related activities,” said Joel Prakken, chairman of Macroeconomic Advisers LLC, in an ADP media statement.
The data comes days after the Bureau of Labor Statistics last week announced regional and state unemployment rates were universally higher in December, bringing the national unemployment rate to 7.2 percent. In December, the West and Midwest again posted the highest regional jobless rates, 8.0 and 7.5 percent, respectively. The Northeast and South recorded the lowest unemployment rates, posting 7 percent each. According to the Labor Department’s report, all four regions registered “statistically significant rate increases” from November and from the year earlier.
Congress was debating as of Wednesday a financial stimulus package that House Democrats claim would keep or create some 3 million jobs. The House version of the bill was passed last week in the hopes a final version would hit President Barack Obama's desk by mid-February. It was unclear at the time this story was published what effect the bill — if signed into law — will have on the payrolls of small, medium and large businesses.
Write to Diana Golobay at diana.golobay@housingwire.com.
Raw mortgage application volume rose 8.6 percent for the week ending Jan. 30, according to a weekly survey released Wednesday by the Mortgage Bankers Association. The refinance index measuring application volume for refinances increased 15.8 percent from the previous week — accounting for 73.2 percent of total applications, a rise from the 72.8 percent reported the week before — while the purchase index declined 11.2. The volume of conventional purchase mortgage applications slipped 11.3 percent, while the volume of government purchase applications — FHA activity — fell 10.9 percent.
The MBA's survey also reported the rates for 30- and 15-year fixed-rate mortgages continued to inch upward in their retreat from the sub-4 percent mark. The average rate for 30-year FRMs increased to 5.28 percent from 5.22 percent the week before, while 15-year FRMs averaged a 5.15 percent rate, up from last week's 4.98 percent, according to the MBA's data. The four-week moving average decreased 9.2 percent for the overall market; the four-week purchase average slipped 4.7 percent, while the four-week refi average fell 10.7, illustrating continued weakness in the broader application market.
A separate survey conducted by Mortgage Maxx LLC found that raw data adjusted for multiple applications from a single household showed a 13.3 percent drop in household activity for the week ending Jan. 30. The reading, called the Mortgage Application Index — or MAX — showed the second consecutive week of household volume decline in the application market "as the first wave of potential re-mortgagers fade," according to MAX publisher Paul Descloux. In combination with the MBA's increased raw volume of applications, the market would appear to be drawing a larger frequency of applications from a decreased number of households.
The MAXcal, which breaks out the data for the local Californian market, found that household activity declined 8.5 percent for the state. The overall weakness might be a reaction to rising mortgage rates after rumors had spread regarding a possible mandated 4 or 4.5 percent mortgage rate. In his commentary on the index, Descloux proposed an alternative to the fickle mortgage rate plan the Federal Reserve might have been aiming for with its reduction of the federal funds rate to an effective zero percent range.
"Instead of generating all that locomotion that the refi process entails, and which because of origination expenses disproportionately benefits some, why not with the stroke of a pen allow mortgagors to take a tax deduction for scheduled and additional principal for a predetermined time on all mortgages," Descloux wrote. "This could decrease the need for a very expensive purchasing of MBS debt, shrink the amount of assets on banks books freeing up capital, protect to some extent the value of servicing portfolios from a refi tsunami, and give citizens the ability to invest in their own future as well as feel like they’re a part of the process. Run the numbers."
Visit www.mbaa.org or www.mortgagemaxx.us for further details.
Write to Diana Golobay at diana.golobay@housingwire.com.
There's a saying about death by a thousand paper cuts, and that's clearly been taking place for most of the private mortgage-backed securities market over the course of the past twelve months. On Monday, Standard & Poor's Ratings Services lowered the boom — again — on thousands of Alt-A and subprime RMBS, moving them all to a 'D' rating, as well as cutting hundreds of formerly AAA-rated securities multiple notches from their previous perch atop the ratings heap. The agency also began cutting ratings on prime deals, as well.
The rating agency said it had lowered its ratings to 'D' on 1,078 classes of mortgage pass-through certificates from 650 U.S. Alt-A RMBS transactions from various issuers, while also placing 2,111 ratings from 143 of the affected transactions on CreditWatch with negative implications. Approximately 81.82 percent of the ratings on the 1,078 defaulted classes were lowered from the 'CCC' or 'CC' rating categories, and approximately 98.98 percent of the ratings were lowered from a speculative-grade rating, S&P said in a statement.
Outside of Alt-A, S&P also hammered its ratings on subprime securities, dropping 737 classes of mortgage pass-through certificates from 516 U.S. subprime issuances to a 'D' rating as well. Roughly 97 percent of the ratings on the 737 defaulted classes were lowered from the 'CCC' or 'CC' rating categories, S&P said. See the statement.
That was just for starters, apparently. S&P also lowered its ratings to 'D' on 117 classes from 94 different prime jumbo deals, 89 classes from 68 U.S. closed-end second-lien deals, as well as 73 classes from from 48 U.S. scratch-and-dent deals.
AAA pain mounts
Despite all of the cuts to securities that were already considered speculative grade, it's perhaps more telling that S&P also took the hatchet to AAA-rated classes — an example of a few Wells Fargo deals involving 32 classes is here, but there are others. These downgrades weren't to a 'D' level, of course, but a fall from the AAA perch is likely to be comparatively far more painful for an investor.
And for those really, really geeked out by this sort of stuff: some of the 2007 deals being downgraded here now have cumulative loss projections exceeding 20 percent. For the ENTIRE issue. That's nearly unheard of outside of the subprime space.
The bottom line here is this: for all of the pain felt in this area already, plenty of banks large and small are still generally carrying securities on their books at a level justifiable against current ratings levels, which is partly why trades in this space have been frozen. Buyers know the securities aren't worth the AAA rating they've got, and frankly so too do any would-be sellers, but nobody can sell a security still at AAA at C-level prices and then justify the hit that so doing would have on the rest of their books.
With many of these AAA high-fliers falling officially off their perch, expect two things to take place: one, further mark-downs to portfolio holdings among those institutions that hold a good amount of private-party Alt-A and other RMBS. Second, you might actually see some trades materialize as the number of AAA downgrades pick up and would-be sellers can no longer justify their ridiculous marks.
There is a reason there is so much discussion — heated discussion — around a bad bank right now. Financial institutions are quite aware these downgrades are coming in waves, and are trying to figure out how to get out from underneath the second wave of soon-to-be bad debt as fast as they possibly can. Because there is still plenty of bad debt hiding on the books at most companies that were players in the private party mortgage market; and even before this round of downgrades, most of the TARP capital that has been doled out was done to offset the first round of write-downs.
I tend to think Oppenheimer's Meredith Whitney hit the nail on the head in suggesting last month that banks are going to need far more capital than what's been committed to weather this mess.
Write to Paul Jackson at paul.jackson@housingwire.com.
