Debt Restructuring - Mortgage Loan How to

Dubai Debt Crisis about Imact World

2009-11-28T02:10:00.000-08:00

Dubai delay for pay debts. Expert cannot forecast and told not deep impact. I think, they know but don't say. For me, it will impact.

What Impact
1. Property Price Drop more than 70% because Dubai have nothing, no resource, no manpower and no oil.
2.Rich Man Impact
3.Money escape
4.Lender like a Bank in USA Europe and Asia need raise fund for reserve.

This is enough for deep impact

What is GovernmentAuctions.org

2009-10-18T03:03:00.000-07:00

GovernmentAuctions.org is a division of Cyweb Holdings Inc. and headquartered in New York, U.S.A. Service are help users find, locate and attend government auctions and foreclosures.

Cyweb Holdings is a company that, through it's divisions and holdings, provides high quality web-based information services to the public.

CNBC said about GOVauction
"It's fascinating and it could be a way to make money as well. If you go to one of these aggregate websites like GovernmentAuctions.org, that's a pretty good place to start."

website : GovernmentAuctions.org

What is Remortgage and Reason

2009-10-12T16:01:00.000-07:00

Remortgage is another word of refinancing, that is the pay off one mortgage and move to a new mortgage using the same collateral. This is tricks of debtors to change for lower interest rate from a different lender.

Remortgage Reasons and Tricks

Reduce the size of repayments
Lower Mortgage Rate
Get more Loan on same property security(Raise Capital)
Consolidate other debts.
Change to quality Lenders (This is important today because Bad Lenders/Bad Bank will your business bad too.

What concern for Remortgage
When switching to another lender beware and consider about fee charge from old and new lenders

HomeSteps Promotion 2009 Smartbuy

2009-08-30T10:26:00.000-07:00

HomeSteps 2009 Nationwide SmartBuy Purchase Program

Promotion Dates: July 17, 2009 - October 30, 2009, with escrow closed by December 31, 2009.
HomeSteps introducing SmartBuy program Nationwide.

2-Year Warranty Included
* Comprehensive two-year HomeProtect** Home Warranty
* Up to a 3.5%* Buyer's Closing Cost offer (must be submitted upon initial offer)
* HomeProtect** Appliance Discount (up to 30% savings on name brand appliances)

To qualify for this offer:
1. Complete the SmartBuy Buyer’s Closing Cost registration form below to obtain your coupon.
2. Ask your real estate agent to show you the available HomeSteps homes in your area.
3. Confirm with your real estate agent that the Home Protect** Home Warranty is available with this home.
4. Present your completed Buyer’s Closing Cost coupon upon initial offer on a HomeSteps home.
5. Receive your SmartBuy Buyer’s Closing Cost offer, upon qualified closing.
6. Receive your Home Protect** 2-year Home Warranty upon qualified closing.
7. Complete and submit the Homebuyer Survey form to your Closing Agent (Closing Agent to provide)

First-Time Homebuyers may have the opportunity to also take advantage of the $8,000 Tax Credit ***

More Information at HomeSteps for HomeOwner

What is Jumbo Mortgage USA

2009-08-29T10:03:00.000-07:00

What is Jumbo Mortgage
Jumbo Mortgage is a mortgage with a loan amount above the industry-standard loan limits that set by Fannie Mae and Freddie Mac. Loans above the conforming limits may be offered by seller servicers of these wholesale institutions, as well as Wall Street conduits who provide warehouse financing for mortgage lenders. The loan amounts reflect average loan sizes nationwide.

Jumbo mortgages apply when agency (FNMA and FHLMC) limits don't cover the full loan amount. Fannie Mae (FNMA) and Freddie Mac (FHLMC) are large agencies that purchase the bulk of residential mortgages in the U.S. They set a limit on the maximum dollar value of any mortgage they will purchase from an individual lender. As of 2006, the limit is $417,000, or $625,500 in Alaska, Hawaii, Guam, and the U.S. Virgin Islands. Other large investors, such as insurance companies and banks, step in to fill the need, with maximum mortgage amounts going to the $1 million or $2 million range. A loan in excess of $650,000 is referred to as a super jumbo mortgage. The average interest rates on jumbo mortgages are typically greater than is normal for conforming mortgages, and vary depending on property types and mortgage amount.

On February 13, 2008 President George W. Bush signed an economic stimulus package that temporarily increased the conforming limit in the United States to $729,750 until December 31, 2008. The limit for any area would be the greater of the 2008 conforming loan limit ($417,000); or 125% of the area median house price, but no more than 175% of the 2008 conforming loan limit ($729,750, which is 175% of $417,000)

Jumbo Mortgage Rate
(August 29, 2009)

30 Year Fixed Jumbo 6.02%
15 Yr Fixed Jumbo 5.46%
3/1 ARM Jumbo 5.08%
5/1 ARM Jumbo 5.23%

Credit What is Jumbo Mortgage Wikipedia

Microsoft and Yahoo Announce Search Agreement

2009-07-29T06:28:00.000-07:00

Microsoft, Yahoo! Announce Search Agreement
July 29, 2009
Microsoft will now power Yahoo! search while Yahoo! will become the worldwide relationship sales force for both companies’ premium search advertisers.

SUNNYVALE, Calif. and REDMOND, Wash. — 29 July, 2009 — Yahoo! and Microsoft announced an agreement that will improve the Web search experience for users and advertisers, and deliver sustained innovation to the industry. In simple terms, Microsoft will now power Yahoo! search while Yahoo! will become the exclusive worldwide relationship sales force for both companies’ premium search advertisers.

For Web users and advertisers, this deal will accelerate the pace and breadth of innovation by combining both companies’ complementary strengths and search platforms into a market competitor with the scale to fuel sustained development in search and search advertising. Users will find what they care about faster and with more personal relevance. Microsoft’s competitive search platforms will lead to more value for advertisers, better results for web publishers, and increased innovation and efficiency across the Internet.

Microsoft CEO Steve Ballmer discusses the search agreement with Yahoo! and what it will mean to customers, advertisers and the industry.
View in stand-alone player.
Under this agreement, Yahoo! will focus on its core business of providing consumers with great experiences with the world’s favorite online destinations and Web products.

“This agreement comes with boatloads of value for Yahoo!, our users, and the industry. And I believe it establishes the foundation for a new era of Internet innovation and development,” said Yahoo! Chief Executive Officer Carol Bartz. “Users will continue to experience search as a vital part of their Yahoo! experiences and will enjoy increased innovation thanks to the scale and resources this deal provides. Advertisers will also benefit from scale and enjoy greater ease of use and efficiencies working with a single platform and sales team for premium advertisers. Finally, this deal will help us increase our investments in priority areas in winning audience properties, display advertising capabilities and mobile experiences.”

Full Press Release at Microsoft.com

What is Cash for Clunkers Program 2009

2009-07-27T16:33:00.000-07:00

What is Cash for Clunkers Program 2009
that What is the Car Allowance Rebate System?
Boost Auto Industry

C.A.R.S come from car allowance rebate system. The CAR Allowance Rebate System is a $1 billion government program that helps consumers buy or lease a more environmentally-friendly vehicle from a participating dealer when they trade in a less fuel-efficient car or truck. The program is designed to energize the economy; boost auto sales and put safer, cleaner and more fuel-efficient vehicles on the nation's roadways.

Consumers will be able to take advantage of this program and receive a $3,500 or $4,500 discount from the car dealer when they trade in their old vehicle and purchase or lease a new one. Consumers you do not need to register anywhere or at anytime for this program.

Yes, I believe this stimulus can boost Auto Industry

How to Qualified

Participate in the CARS Program July 1, 2009 - November 30, 2009
Qualified consumers will receive a credit of $3,500 or $4,500 for an eligible trade-in toward the purchase of lease of an approved vehicle under CARS Program.
Qualified consumers will receive the $3,500 or $4,500 credit at the time the purchase their new vehicle.
Dealers must provide consumers with any other advertised rebates or discounts in addition to the credit they receive through the CARS Program.

Important Things to Know

Vehicle must be less than 25 years old on the trade-in date
Only purchase or lease of new vehicles qualify
Generally, trade-in vehicles must get 18 or less MPG (some very large pick-up trucks and cargo vans have different requirements)
Trade-in vehicles must be registered and insured continuously for the full year preceding the trade-in

Relate Information

More information abou CARs Program goto CARs.gov (give up about many 404 pages because starting news site)
GM Cash for Clunkers Cars Rebate 2009

GM Cash for Clunkers Car Rebate 2009

2009-07-27T16:01:00.000-07:00

GM Cash for Clunkers
Car Rebate 2009 for GOV vouchers $3,500-$4,500

July 26, 2009
After, the U.S. Government passed stimulus for car industry and providing vouchers valued from $3,500 to $4,500 when trade-in a vehicle and purchase a new one.

GM luanch CARS program or The Car Allowance Rebate System (commonly referred to as Cash for Clunkers or Customer Assistance to Recycle and Save) is available to customers at registered, participating dealers.

The CARS designed to help customers purchase a new, more fuel efficient vehicle. The program’s July launch and its’ end on November 1, 2009.

Relate Information

Find out how much you can save via a CARS voucher with GM goto GM Cash for Clunkers Page
Cash for Clunkers Qualifly 2009

SmartBuy Freddie Mac Homesteps Home Promotion

2009-07-21T16:41:00.000-07:00

Freddie Mac Homesteps Sales and Promotion

I got e-mail from Freddie Mac about Home Sales and Promotions. I think is good information for home buyer. Promotion about two year warranty to owner-occupants buying Freddie Mac Homesteps Homes.

SmartBuy" Sales Promotion Offers Two-Year Warranty to Owner-Occupants Buying Freddie Mac Homesteps® Homes
Freddie Mac Will Also Pay Up to 3.5% of Buyer Closing Costs

McLean, VA – People purchasing single family HomeSteps® homes as a primary residence will receive a comprehensive two-year home warranty paid for by Freddie Mac (NYSE:FRE) as part of HomeSteps' SmartBuy sales promotion. In addition, for a limited time, Freddie Mac will pay up to 3.5 percent of the sales price in buyer's closing costs, potentially saving qualified buyers of HomeSteps homes thousands of dollars in transaction costs.

Note : Freddie Mac was established by Congress in 1970 to provide liquidity, stability and affordability to the nation's residential mortgage markets.

More Information about this Promotion

Forgive Student Loan Debt Stimulus 2009 Ask?

2009-06-11T17:26:00.000-07:00

Forgive Student Loan Debt
Economic Stimulus 2009

Today, Every talk about idea to forgive student loan debt in stimulus package of government.
I agree with stimulus plan to help debtors and creditors.

But Forgive by not consider others factors, I disagree...

It will create bad habits in the debt to the public. The best way is through restructuring of public department by debt modification or restructuring. Debt restructuring determined by comparison with the revenue property costs and debt burden of debtor primarily. This will really be fair to all parties. Are less damaging than the immediate remit.

Remission too easy. No one will go to pay debt and Banking system will crash again.

What is Debt Ratio and How Do

2009-05-09T18:06:00.001-07:00

What is Debt Ratio

Debt Ratio is another financial ratio that indicates what proportion of debt has relative to assets. The ratio of total debt and total assets. Debt ratio use in wide

For the company to measure leverage of the company that high debt give high risks.
For the government to measure of how much the government has borrowed. The total amount of borrowing is called the national debt in glossary as a percentage of GDP.
For Personal sometime measure to Bankruptcy

Formula of Debt Ratio

Debt ratio = Total Debt / Total Assets

For example Company A
Total asses = 1 million
Total Debts(Longterm + Shortterm Liabilities) = $250,000
Debt Ratio = 250000/1000000 = 25%

What the Ratio Told

<>
> 1 most of the company's assets are financed through debt. that highly leveraged or mean high risk
*but need compare with industry

However, in Maximized shareholder wealth theory. Many CEO only concern dividend and profit they make over debt because High Debt will high return to shareholder.

For you beware your credit card because credit card interest is the most of rapid grow in the world.

Relate Information

What is Stress Testing in Banking

2009-05-07T17:46:00.000-07:00

What is Stress Testing
and Why Do for Banking and Financial System

Common Term of Stress Testing
Stress testing is a form of testing that is used to determine the stability of a given system or entity. It involves testing beyond normal operational capacity, often to a breaking point, in order to observe the results. Stress testing may have a more specific meaning in certain industries.

Stress Testing in Financial
Stress testing is becoming a widely used tool to assess potential vulnerabilities in a financial
system.
Doing financial projection on a "best estimate" basis, a company may do stress testing where they look at how robust a financial instrument is in certain crashes, a form of scenario analysis. They may test the instrument under, for example, the following stresses:

What happens if the market crashes by more than x% this year?
What happens if interest rates go up by at least y%?
What if half the instruments in the portfolio terminate their contacts in the fifth year?
What happens if oil prices rise by 200%?

or study impact of

Risk factor shock: shock any factor in the chosen risk model by a user-specified amount. The factor exposures remain unchanged, while the covariance matrix is used to adjust the factor returns based on their correlation with the shocked factor.
External factor shock: instead of a risk factor, shock any index, macro-economic series (e.g., oil prices), or custom series (e.g., exchange rates). Using regression analysis, new factor returns are estimated as a result of the shock.

If talk stress testing in banking IMF is standard.

What Is a Stress Testing For IMF
“Stress testing” is a term that comes with much mystique. In individual financial institutions, the term describes a range of techniques that attempt to measure the sensitivity of a portfolio to a set of extreme but plausible shocks. Put more simply, a stress test is a rough estimate of how the value of a portfolio changes when you make large changes to some of its risk factors (such as asset prices). We use the term rough estimate to avoid the perception that stress testing is a precise tool that can be used with scientific accuracy. Stress tests are simply an analytical technique that can be used to produce a numerical estimate of a particular sensitivity. The stress testing process, however, is more than just applying a set of formulas to spreadsheets of numbers, but involves a series of judgments and assumptions that can be as critical to producing meaningful results as the actual calculations themselves. Each assumption, aggregation, or analytical approximation made in the process can introduce wide margins of error to the results, and so much care should be taken in their estimation and
interpretation.

Why Do A Stress Test? (IMF)
Stress testing a financial system can be a resource intensive process, so it is reasonable to ask the question: Why should a country undertake such an exercise? Countries that have completed the process often cite numerous benefits. Financial system stress tests provide information on the behavior of the system under exceptional but plausible shocks, helping policymakers to assess the significance of the system’s vulnerabilities.

Resources, Reference about Stress Testing and Relate Infor

Stress Test Wikipedia
IMF Stress Testing Financial Systems: What to Do When the Governor Calls
Stress Testing US Banking 2009 Results

Stress Testing Banking Results : US Banking 2009

2009-05-07T17:20:00.000-07:00

Stress Testing Banking Results : US Banking 2009
or
The Supervisory Capital Assessment Program Results
May 7, 2009

Fed : May 7, 2009
Statement by Chairman Ben S. Bernanke
Statement regarding the Supervisory Capital Assessment Program

Fed annouced Stress Test Banking Result at afternoon or The Supervisory Capital Assessment Program that collaborated by The Federal Reserve, The Office of the Comptroller of the Currency and the Federal Deposit Insurance Corporation to assess the financial conditions of the 19 largest bank holding companies in the US.

This test not tests of solvency but the assessment program was a forward-looking, "what-if" exercise, even if the economy performs worse than expected between now and the end of next year.

Stress Testing Results
I read The Supervisory Capital Assessment Program Overview and Results (pdf version) that your can download at Fed.

I found result from test follow image that shows the ratio of total estimated two‐year losses to year‐end 2008 risk‐weighted assets (RWA) in the more adverse scenario for the 19 participating BHCs.

"Clearly, there is substantial variation across firms in the size of estimated losses rates, reflecting differences in business lines and asset quality. The median loss‐to‐RWA ratio equals 7.5 percent, and the ratio ranges from 3.0 percent to 11.8 percent across the firms. These estimates are not forecasts of expected losses, but are estimates of losses that would occur under economic conditions more stressed than anticipated. Higher loss estimates do not necessarily imply a need for more capital to meet the SCAP buffer, as some firms will also have higher estimated esources and capital."

Source and Press Reslease

US Banking Stress Test Results CNN Video

2009-05-06T19:57:00.000-07:00

Banking 'stress test' Results from CNN video

Time 4:29
CNN's Kristie Lu Stout asks BusinessWeek's Roben Farzad about Washington's bank 'stress test'.
and Headlind News

Stress test results: Banks face $75B capital shortfall - May. 7, 2009

Relate Information

Loan Modification and Restructure Model Scenario II

2009-04-15T00:31:00.000-07:00

Mortgage Debt Restructure Model
Scenario II : Still Work buy Salary Hard Drop and
Modify by Interest Rate and Interest Suspense, Maturity

Senario II : Debtors is still a job buy was reduced deep income or salary. This Model solved by Interest Rate and Maturity.

Mortgage Loan Characteristics

Years to maturity = 28 (A)
Remaining Principal = $200,000 (B)
Monthly Taxes & Insurance = $250 (C)
Current Interest Rate = 8% (D)
Current Monthly Principal and Interest Payment = $1,494 (E= PMT excel formula "PMT((D/12),(A*12),B)"
Total Current Monthly Payment = $1,744 (F = C+E)

Scenario II : Still Work but Salary Dropped to $2500

Monty Salary = $2,500
Consumptions = $1,500
Reserve Credit Card = $300** (This is big problem because high interest and vary but I ignore it with 10% reserve)
Tax and Insurance = $250
Capacity for Payment = $450

Cannot serve Current Monthly Payment $1744.00

Mortgage Restructure by Interest Rate, Maturity

Modifyl by Interest to 4% 3 Year and paid 2% and suspense 2%
Interest Rate Payment per Month = $333
Interest Suspense = $333
Capacity = $450
Remain Capacity = $117

* Optional Homeowner can pay more for reduce principle
* Homeowners left money for consume that will boots demand and economics(calculate at 5,000,000 mortgages How money into economics)
* Expand Term from 28 to 31 Years
* After Y3 New Restructure again with Homeowner's capacity, Interest, Payment

Relate Information

The Signals of Economics Progress

2009-04-14T23:57:00.000-07:00

"are starting to generate signs of economic progress," but more tough times are ahead.
"The Recovery Act, the bank capitalization program, the housing plan, the strengthening of the nonbank credit market, the auto plan and our work at the [Group of 20 summit] have been necessary pieces of the recovery puzzle," Obama said in a speech at Georgetown University in Washington

more from CNN.com

What is the recovery signal?
For the basics factors of economics recovery is employment rate, consumer confident, Hous Mareket, Car Market, Loan Portfolios etc. Now, I don't seen main factors in rise.

However, This is good thingk to do and good idea from leaders. And I agree. The optimistic will take from the crisis. Economic recovery plan will see results in another 6 months.

But also to accelerate the management is dealing with the problem financial institutions. The bank closed all day Friday as undermine the confidence every week. Why not make accelerated nationwide completed within 1-2 months. I don't really understand. It difficult to meet?

The another big problem is like a blood vessel of American business is the automotive industry. Dealing with the giants in the industry easily. If you do not believe in the old administration. Government is all bought by the current value or value of bankruptcy To maintain employment. After that tend to define reform plan when appropriate.

Relate Information

Public Private Partnership Investment Program 2009

2009-03-23T15:36:00.000-07:00

Public Private Partnership Investment Program

March 23, 2009 Timothy Geithner, Treasury Department releases details of
Releases Details on Public Private Partnership Investment Program

Public-Private Investment Program
Fact Sheet

The Financial Stability Plan – Progress So Far: Over the past six weeks, the Treasury Department has implemented a series of initiatives as part of its Financial Stability Plan that – alongside the American Recovery and Reinvestment Act – lay the foundations for economic recovery:

Efforts to Improve Affordability for Responsible Homeowners: Treasury has implemented programs to allow families to save on their mortgage payments by refinancing, assist responsible homeowners in avoiding foreclosure through a loan modification plan, and, alongside the Federal Reserve, help bring mortgage interest rates down to near historic lows. This past month, the 30% increase in mortgage refinancing demonstrated that working families are benefiting from the savings due to these lower rates.
Consumer and Business Lending Initiative to Unlock Frozen Credit Markets: Treasury and the Federal Reserve are expanding the TALF in conjunction with the Federal Reserve to jumpstart the secondary markets that support consumer and business lending. Last week, Treasury announced its plans to purchase up to $15 billion in securities backed by Small Business Administration loans.
Capital Assistance Program: Treasury has also launched a new capital program, including a forward-looking capital assessment undertaken by bank supervisors to ensure that banks have the capital they need in the event of a worse-than-expected recession. If banks are confident that they will have sufficient capital to weather a severe economic storm, they are more likely to lend now – making it less likely that a more serious downturn will occur.

Full Release and Download (Pdf Acrobat)

My Opinion
PPPiP 2009 is a correct answer. Source of the problem from financial institutions, Therefore, to resolve a financial institution.
No details for home owners. But this plan will be a chain of rehabilitation. Financial institutions will have to borrow more streamlined. Consumers and businesses can borrow money more easily. Bad Debt or Debt of non-revenue or Non Performing Loan has been resolved. The lawsuit forced home owners will decrease. Stop home prices slump. This means that the economy can recover.

But another important issue and management must urgently deal with the financial institution is not transparent fraud unmoral to this problem decisively and urgent. To regain confidence.

Relate Information

Most Likely to Default from Moody's

2009-03-10T08:46:00.000-07:00

Moody's unveils most-likely-to-default list

Credit rater publishes list of 283 companies that are in danger of defaulting on their debt payments.
By David Goldman, CNNMoney.com staff writer

NEW YORK (CNNMoney.com) -- Credit-rating giant Moody's Investors Service published a list of companies Tuesday that it believes are most likely to default on their debt.

Called the "Bottom Rung," the list is comprised of companies with a B3 credit rating or below, and whose ratings are negative or being reviewed. A B3 rating is the sixth-lowest rating that Moody's offers and is considered "junk" status.

source : CNNMoney.com

My Opinions

Moody's Corporation (NYSE: MCO) is the holding company which provide about financial research and ranks the credit-worthiness of borrowers using a standardized ratings scale. Mood's is Top 3 Credit Rating agency of the world.

Some expert told World and US economics crisis developed from credit crisis that also effect to rating agency. AAA, A-, B+ from rating agency cannot help anything and no waring. For me, I agree and dis-agree

I agree about we cannot trust someone when will invest. You need help yourselt.

I dis-agree in the nature have good and bad that for me Moody's can use for analysis.

Finally, Bad news plenty that effect feeling to consume. Delay bad news and help to solve promblem is best way..

Home Affordable Modification Program Guidelines

2009-03-04T02:51:00.000-08:00

Home Affordable Modification Program Guidelines
from US Department of Treasury

Download Full in PDF http://www.ustreas.gov
Release March 4, 2009

This is guidelines and trial loan modifications from Department of the Treasury.
Program Elements Described in the Guidelines

Monthly Payment Reduction Cost Share:
Treasury will partner with financial institutions to reduce homeowners’ monthly mortgage payments. The lender will have to first reduce payments on mortgages to no greater than 38% Front-End Debt-to-Income (DTI) ratio. Treasury will match further reductions in monthly payments dollar-for-dollar with the lender/investor, down to a 31% Front-End DTI ratio for the borrower.

Servicer Incentive Payments and Pay for Success Fees:
Servicers will receive an up-front Servicer Incentive Payment of $1,000 for each eligible modification meeting guidelines established under this initiative. Servicers will also receive Pay for Success payments –as long as the borrower stays in the program – of up to $1,000 each year for up to three years.
Similar incentives will be paid for Hope for Homeowner refinances.

Borrower Pay-for-Performance Success Payments:
Borrowers are eligible to receive a Pay-for-Performance Success Payment that goes straight towards reducing the principal balance on the mortgage loan as long as the borrower is current on his or her monthly payments. Borrowers can receive up to $1,000 of Pay-for-Performance Success Payments each year for up to five years.

Current Borrower One-Time Bonus Incentive:
One-time bonus incentive payments of $1,500 to lender/investors and $500 to servicers will be provided for modifications made while a borrower is still current on mortgage payments. The servicer will be required to maintain records and documentation evidencing that the Trial Period payment arrangements were agreed to while the borrower was less than 30 days delinquent. The servicer must comply with any express pooling and servicing contractual restrictions for modifying current loans.

Program Payment Conditions
No payments under the program to the lender/investor, servicer, or borrower will be made unless and until the servicer has entered into the program agreements with Treasury’s financial agent. Servicers must enter into the program agreements with Treasury's financial agent no later than December 31, 2009.

My Opinions
This is only guideline. Good idea but not hit.

Situation in a serious economic problem. Lack of confidence in financial institutions. The need to resolve the debt problem is more than this.

Relate Information

What is DebtX

2009-02-26T15:16:00.000-08:00

What is DebtX

Today Feb 26, 2009
DebtX News
DebtX Announces Loan Sales on Behalf of the FDIC
DebtX is pleased to announce four loan sales scheduled to bid March 17, 2009. The loans are being offered on behalf of the FDIC as receiver for Sanderson State Bank, The Community Bank, First Georgia Community Bank and IndyMac Bank. The loans are secured by a wide range of collateral, including commercial real estate, business and consumer assets.

What is DebtX
DebtX is The Debt Exchange, Inc. is one of the world's leading full-service loan sale advisors for commercial, consumer and specialty finance debt. DebtX operates the largest online marketplace of buyers and sellers of Loan.

I interest about DebtX product about Loan Valuation Service but they not told foumula or how to calculate. Why I interest it. When you ask to Loan Modification with creditors. if you know transfer price that we know how much to lump sum pay.

But not secret for Loan Valuation. When investor will but loan portfolio they will concern
- Collateral Value (and discount it)
- Quality of Loan (and discount it)
- Quality of Debtors (and discount it)

Relate Information

Mortgage Debt Restructure Model Scenario I

2009-02-21T18:37:00.000-08:00

Mortgage Debt Restructure Model
Scenario I : Base on Salary and still have a Jobs and
Restructure by Interest Rate, Maturity

Firt debt restructuring model is simple. The hypothesis that the salary income of 3,000 dollars and 200,000 dollars debt outstanding with 28 years. Restructure wiht Interest rates that enable relief to be home. Despite low interest rates. Affecting financial institutions, but not much that profit will be reduced but the quality of debt back. This positive impact to creditors debtors and and help the price of home slump.

This is just the first example. Have various debt restructuring model that the important is fit to debtor's capacity and help to relife.

Mortgage Loan Characteristics

Years to maturity = 28 (A)
Remaining Principal = $200,000 (B)
Monthly Taxes & Insurance = $250 (C)
Current Interest Rate = 8% (D)
Current Monthly Principal and Interest Payment = $1,494 (E= PMT excel formula "PMT((D/12),(A*12),B)"
Total Current Monthly Payment = $1,744 (F = C+E)

Scenario 1 : Still Work but Salary Dropped to $3000

Monty Salary = $3,000
50% Consumptions = $1,500
10% Reserve Credit Card = $300** (This is big problem because high interest and vary but I ignore it with 10% reserve)
Tax and Insurance = $250
Capacity for Payment = $950

Cannot serve Current Monthly Payment $1744.00

Mortgage Restructure by Interest Rate, Maturity

Interest 4% 3 Year (4% Base Forecast Crisis 3 Years and 4% can make profit for FI)
Interest Rate Payment per Month = $667
Capacity = $950
Remain Capacity = $283

Mortgage Debt Restructure I Spreadsheet (Google Doc)
Loan Modification and restructure Scenario II (Salary Drop and Interest Suspense)
Obama's Mortgage Plan Video YouTube
Debt Restructuring Ways & Methods

2009 Obama's Mortgage Plan for Homeowners

2009-02-18T15:27:00.000-08:00

The New Hope for Million Homeowners

After economic recovery plan worth nearly $800,000 million that market is not responding as hoped. Today we received the good news for the housing loan or Morgage Loan and Homeowners. I called a section of the spot as the official tries to resolve this crisis.

From the interviews of President Barack Obama concluded as follows.(Feb 18, 2009)
President Barack Obama unveiled his $75 billion mortgage relief plan, a series of measures the president says will keep 9 million people from losing their homes

Reduce Monthly Payments
New incentives for lenders to modify the terms
Steps to keep mortgage rates low for millions of middle class families
Additional reforms designed to help families stay in their homes.

My Opinions
Not clear for me. But a good direction and the Leader know where the problem is. In conditions of high unemployment and House price slump. The lawsuit does not benefit creditors, debtors and the overall economy. Now people in saving money, not spend money because no confidence in the economy. If this is left to another 6 months I predict that the situation will worsen over this.

Reducing monthly payments problem correctly. But to make more. Restructuring debt to reduce interest, reduce principal, extend term, suspend payment and more..

The advantages of solving this problem(Resulting in a good cycle and chains)

To keep people home.
The remaining money from home relief. And spend for cosume more
Home prices fall less.
Have more purchasing power (more demand)
Production will increase (Supply up)
Layoffs will decrease.
Money cycle again. (This plan use a little money)

This is the recovery cycle. Should be set up National Asset Management companies to operate. And elimination of financial institutions that are not quality. To help people to more than 20 million people within 1 year the economy will recover.

Tomorrow I will offer models of debt restructuring with home loans. Simple but hit.

Thank, for read

Relate Information

2009 Obama's Mortgage Plan Video

2009-02-18T15:12:00.000-08:00

2009 Obama's Mortgage Plan Video

This is good news for Homeowner

-----------

Relate Information

House Passed : 2009 US Stimulus Package Plan $800 Billion

2009-02-13T15:56:00.000-08:00

2009 US Stimulus Package Plan $800 Billion
House Passed

American Recovery and Reinvestment Act, H.R.1 (Final Stimulus Bill Text)

February 13, 2009 : Congress passed the Conference Report of the American Recovery and Reinvestment Act, H.R. 1, to save and create jobs, get our economy moving again, and transform it for long-term growth and stability. The landmark legislation is the first dramatic new investment in the future since the creation of the interstate highway system a half century ago. On January 28, the House passed the initial American Recovery and Reinvestment Act, H.R. 1, working from priorities shared with President Obama.

Full Press Release from House Speaker

Summary of US Stimulus Plan close $800 billion and breakdown and subject to

Create and save 3.5 million jobs
American workers an immediate tax cut.
Invest in infrastructure projects.
Restore science and innovation as the keys to new American-made technology, preventing and treating disease, and tackling urgent national challenges like climate change and dependence on foreign oil.
Invest quickly into the economy.

My Opinions

I agree with this plan. On prevention of unemployment. And investment areas. Including reducing taxes. To stimulate the economy that made to the money flowing into the system.

But What is the cause of the economic slump. Everyone knows that from low-quality home loans. Lending to the failure of financial institutions. Control rules of supervision failure. Avidity of the businessmen on the financial markets.

I believe that reducing the unemployment problem. But the financial sector will also continue to have problems and big problem. Lending will continue to jam. Bad debt problem has not resolved the shape. Financial institutions have not yet managed to be quality time. I have 1-2 days I will offer ideas on how to resolve debt. It does not use money from the state.

Stimulus Video from Speaker

Relate Information

US Economic Stimulus Package (Jan 28, 2009)
2008 Obama Stimulus Plan

US Economic Stimulus Package 2009 - Jan 28, 2009

2009-01-28T22:00:00.000-08:00

Video House Speaker About Ecomomic Stimulus Package 2009
Version before Senate and House Version

US Economic Stimulus Package 2009 Details
with
American Recovery and Reinvestment Act, H.R. 1

January 28, 2009
American Recovery and Reinvestment Act
Today, the House passed the American Recovery and Reinvestment Act, H.R. 1, working from priorities shared with President Barack Obama. This recovery package have value about $850 billion and objective for create and save a million jobs recovery us economy.

I will take a time to consider Stimulus Detail and will post again.

Relate Information

What is Agape World Inc.

2009-01-26T15:31:00.000-08:00

What is Agape World

Today Big New talk about Ponzi Scheme, Bridge Loan and Agape World

Agape World Hot News and Update From LIBN
Agape World stormed by FED, and Update nes Nicholas Cosmo was not at his Hauppauge offices and no employees

What is Agape World
Agape World Inc. is a private bridge lender since 1999. Products and Service of Agape include Equity Participations, Joint Ventures, Acquisition Loans, Bridge Loans, Construction Loans and Phase II/III financing for both income-producing and owner-occupied properties nationwide.

Agape told that not a mortgage company or regulated lending institution but is a taken equity positions if we like the future of your project. And private sources of financing for bridge loans.

------------------------------------------------------------------------
But This is talk about Agape World last year

Has anyone invested with Agape World Inc. and received 14% returns? Can someone please validate this company? - Yahoo Answer
Has anyone invested with Agape World Inc? They provide bridge loans, and offer investors 13-14% returns.? - Fatwallet

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My Opinions
This is another effects from economic crisis and always happen. When system no work. For Financial Basic High Risk High Returns---- Not really High Risk , required High Return.
And For Ponzi high risk and may be no returns.
This is job of GOV.

Dow Jones under 8000 and can dropped to 5000

2009-01-23T07:19:00.000-08:00

Dow Jones under 8000
(Jan 23, 2009)
USA Economic Cycle not yet bottom!!!
What is Bottom 7000 6000 5000 (I see at 5000)

This is News results and expect about Dow under 8000

Banks Pull Dow Under 8000 : Wall Street Journal - Jan 21, 2009
Dow Drops Below 8000 on Fresh Fears About Banks : Washington Post
Bank Worries Push Dow Below 8000 :New York Times
US Stocks Decline At Open : MarketWatch

My Opinions
I ever wrote about Crisis Cycle last year. After Bank failed, beware real sector crash that now coming in. Last year main bankruptcy were bank industry that dow drop only 1000-3000 points. But for real sectors(Tech, Food, Heavy Industry) can push to 5000. Dow drop not only worried about bank. but include

Bank Performance and Stable
Big Company Earnings dropped and loss (Yahoo, Microsoft, Toyota, GE, GM etc)
Still Layoffs (For new economics after Y2K, reduce labors is reduce demand of company)

Google and IBM rise earnings cannot support markets

Way Out !!! How : Only! Gov can help

Build Confident Back
Build Demand by Big Stimulus Package (Tax Policy not enough)
Build Jobs
Delay bankruptcy (cannot get any value on discount assets) : Set up Asset Management Company for buy and transfer debt from bank for delay bankruptcy and restructure debt that match revenue
Bank System : Closed weakness Bank, push money to Strong Bank and Guarantee depositors
Stop Layoffs : Negotiate, Bailouts or help with fund but control company too.

For Fed Fund Rate or Mortgage Rate under zero. I think that don't help anything. Because, new era new problem cannot use old tools. And Corporate cannot pay accrued interest that zero rate don't help and don't push money to system .

2009 Bank Failed - National Bank of Commerce and Bank of Clark County

2009-01-18T22:58:00.000-08:00

2009 Bank Failed (USA)
(Bank Friday Failed not Black Friday Sales)
National Bank of Commerce and Bank of Clark County Closed

Only second week of The New Year 2009, with Bank Failed with nearly total asset $1,000 mil. I like to know Why FDIC announced Bank Failed on Friday.

FDIC Press Release Bank Failed
January 16, 2009

National Bank of Commerce Failed
Republic Bank of Chicago Acquires All the Deposits of National Bank of Commerce, Berkeley, IL

National Bank of Commerce, Berkeley, Illinois, was closed today by the Office of the Comptroller of the Currency, and the Federal Deposit Insurance Corporation (FDIC) was named receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Republic Bank of Chicago, Oak Brook, Illinois, to assume all of the deposits of National Bank of Commerce.

As of January 7, 2009, National Commerce Bank had total assets of $430.9 million and total deposits of $402.1 million. Republic Bank agreed to purchase approximately $366.6 million in assets at a discount of $44.9 million.

Bank of Clark County
Umpqua Bank Acquires the Insured Deposits of Bank of Clark County, Vancouver, WA

Bank of Clark County, Vancouver, Washington, was closed today by the Washington Department of Financial Institutions, and the Federal Deposit Insurance Corporation (FDIC) was named receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Umpqua Bank, Roseburg, Oregon, to assume the insured deposits of the Bank of Clark County.

As of January 13, 2009, Bank of Clark County had total assets of $446.5 million and total deposits of $366.5 million. At the time of closing, there were approximately $39.3 million in uninsured deposits held in approximately 138 accounts that potentially exceeded the insurance limits. This amount is an estimate that is likely to change once the FDIC obtains additional information from these customers.

Source : FDIC

Nortel Bankruptcy 2009

2009-01-15T15:43:00.000-08:00

BNortel filing for Bankruptcy

TORONTO - Nortel* Networks Corporation [NYSE/TSX: NT] announced that it, Nortel Networks Limited ("NNL") and certain of its other Canadian subsidiaries will seek creditor protection under the Companies' Creditors Arrangement Act ("CCAA") in Canada. As well, certain of the Company's U.S. subsidiaries, including Nortel Networks Inc. and Nortel Networks Capital Corporation, have filed voluntary petitions in the United States under Chapter 11 of the U.S. Bankruptcy Code, and certain of the Company's EMEA** subsidiaries are expected to make consequential filings in Europe. The Company's normal day-to-day operations are expected to continue without interruption. Nortel remains 100% focused on serving customers worldwide through continued R&D investments and support of its product portfolio to fulfill customer needs.

Full Press Release from Official Site

My Opinions

Nortel is a multinational telecommunications equipment manufacturer headquartered in Toronto, Ontario, Canada. Nortel’s networking solutions include hardware and software products and services. Nortel operates in four segments: Carrier Networks (CN), Enterprise Solutions (ES), Metro Ethernet Networks (MEN) and Global Services (GS).

This is Big Bankruptcy for early 2009. Nortel revenue in 2007 is $10.95 Billion for 2008 dropped and Employee 32,550. I try to consider Nortel Debt and Cash Flow that they have problem about Cash Flow.

Motorola Layoffs 2009

2009-01-15T05:53:00.000-08:00

image from photobucket

Motorola Layoffs Motorola Announces Further 2009 Cost Reduction Actions and Provides Preliminary Fourth-Quarter 2008 Results Announces approximately 4,000 additional workforce reductions, primarily in the Mobile Devices business
Company to announce fourth-quarter financial results on February 3, 2009
January 14, 2009

SCHAUMBURG, Ill. – Motorola, Inc. (NYSE: MOT) today announced further cost reduction actions, primarily associated with the Company’s Mobile Devices business. The Company also announced preliminary results for the fourth quarter of 2008. The Company will announce fourth-quarter financial results on February 3, 2009.

Motorola will further reduce its workforce in 2009 by approximately 4,000 positions. This reduction will include approximately 3,000 positions associated with the Mobile Devices business and approximately 1,000 positions associated with corporate functions and other business units. The workforce reductions announced today are expected to begin immediately and are incremental to the 3,000 workforce reduction actions previously announced during the fourth quarter of 2008.
Full Press Release from Motorola

My Opinions I understand about pressure about corporate performance but Layoffs Tool not suitable for this time. Reduce labor is reduce demand. Someone think so far but no... GDP from 4,000 workforce not to much but feeling in news for everybody that make people stop to use money. CEO need to understand crisis that make to build correct plan

Relate Information

Over One Million for Bankruptcy 2008

2009-01-13T15:40:00.000-08:00

What Bankruptcy tell us and What to do next

Bankruptcy Filings Over One Million for Fiscal Year 2008
Dec 15, 2008 — Bankruptcy cases filed in federal courts totaled 1,042,993 for the 12-month period ending September 30, 2008, up more than 30 percent when compared to the 801,269 filings in Fiscal Year 2007, according to statistics released today by the Administrative Office of the U.S. Courts. The September 2008 filings are the highest of any 12-month period since the 2006 implementation of the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, when there were 1,112,542 filings in the 12-month period ending September 30, 2006.

Full New Release form US Courts

My Opinions
I try to analyze about this index what shown. I found for 1.0 Bankruptcy over 95% from non-business.

September 30, 2008, business filings totaled 38,651, up 49% from the 25,925 in September 2007.
Non-business filings totaled 1,004,342, up 30% from the 775,344 in September 2007. In September 2006, non-business bankruptcy filings totaled 1,085,209.

What is non-business bankruptcy? Oh They are us. cause from Jobless. Hurry up Stimulus Package plan. Don't support only big corporate that request help that transport by private plane. If not match the time, problem will up and up

Macy's Store Closings Lists

2009-01-08T07:29:00.000-08:00

Macy's Store Closings

This is big store closings after Circuitcity Bankrupcy. Macy's will going same to Circuitcity Or Not...... because after Circuit City announced layoffs and shut down store. No more 3 months goto bankruptcy.
Be careful.............to do and try survive from recession , The another way is waiting Big Stimulus Plan from Obama.

Press Room for Macy's, Inc

Macy's, Inc. to Close 11 Stores
CINCINNATI, Jan 08, 2009 (BUSINESS WIRE) -- Macy's, Inc. (NYSE:M) today announced the closing of 11 underperforming Macy's stores.

"These closings are part of our normal-course process to prune underperforming locations each year in order to maintain a healthy portfolio of stores," said Terry J. Lundgren, chairman, president and chief executive officer of Macy's, Inc. "While new store growth has slowed in the current economy, our long-term strategy is to continue to selectively add new stores while closing those that are underperforming."

Full Press Room from Macy

List of Stores Closings

Ernst & Young Plaza (Citicorp Plaza), Los Angeles, CA
The Citadel, Colorado Springs, CO
Westminster Mall, Westminster, CO
Palm Beach Mall, West Palm Beach, FL
Mauna Lani Bay Hotel, Island of Hawaii, HI
Lafayette Square, Indianapolis, IN
Brookdale Center, Brooklyn Center, MN
Crestwood Mall, St. Louis, MO
Natrona Heights Plaza, Natrona Heights, PA
Century III Furniture and Clearance, West Mifflin, PA
Bellevue Center, Nashville, TN

Relate Information

CDR Financial Products - Who are you

2009-01-04T15:04:00.000-08:00

Who is CDR Financial Products

After Bill Richardson withdraws as Commerce nominee on Jan 5, 2009 for a pending investigation of a company that has done business with New Mexico state government about transactions between Beverly Hills-based CDR Financial Products and state government officials.

Who is CDR Financial Products

CDR Financial Products is a national capital markets group, creates and markets leading edge financial products and services. Since our inception CDR have negotiated over $158 billion in transactions and executed more than 5,350 agreements.

CDR Financial develops products and strategic alliances across a wide spectrum of financial institutions, including asset managers, banks, broker dealers and insurance companies. Our ability to tailor products and services to client specific needs is our greatest asset. We are unique among boutique capital market groups, in that we take principal positions to facilitate transactions that might not otherwise close.

CDR Financial Products Offices
California: 9777 Wilshire Boulevard Suite 800 Beverly Hills, CA 90212
Georgia : CDR Optimal Consulting Group 341 Anders Path Marietta, GA 30064
Pennsylvania : 1500 Market Street / Centre Square 12th Floor - East Tower Philadelphia, PA 19102

CDR Financial Reports Products and Services

Asset Management Group
Mortgage & Affordable Housing Products
Municipal Reinvestment
Provider Advisory Consulting
Reinsurance Product Development
Structured Products
Swap Advisory Services
Yield Enhanced Cash Products

My Opinions
CDR is professional Financial Advisory in USA. In economics crisis, FA is good choice to be or learning. And adviser is very important for out of recessions. Therefore, How bring them to help.

Relate Information

Bank Friday Failed

2008-12-12T21:47:00.000-08:00

Sanderson State Bank and Haven Trust Bank Failed

I don't understand about why FDIC order to closed Bank on Friday. Total Bank Failed from sub prime is 28

Bank Closing Information for Sanderson State Bank, Sanderson, TX

All deposit accounts have been transferred to The Pecos County State Bank, Ft. Stockton, TX and will be available immediately.

Bank Closing Information for Haven Trust Bank, Duluth, GA

All deposit accounts have been transferred to Branch Banking and Trust Company, (BB&T), Winston-Salem, NC and will be available immediately.

FDIC Press Released : December 12, 2008

Relate Information

Tobin's q Ratio - Cheap or not

2008-12-10T07:17:00.001-08:00

Tobin's q Ratio

q Ratio Signals ‘Horrific’ Market Bottom, CLSA Says
Today, Big talk about q Ratio that The World market and US Market is bottom
Bloomberg News about q ratio

What is q Ratio
Tobin's q is a ratio comparing the value of the stocks of a company listed in the financial market with the value of a company's equity book value. The ratio was developed by James Tobin (Tobin 1969). It is calculated by dividing the market value of a company by the replacement value of the book equity:

Tobin's q = (Equity Market Value + Liabilities Book Value)/(Equity Book Value + Liabilities Book Value)

Another use for q is to determine the valuation of the market as a whole. The formula for this is:

q =value of stock market / corporate net worth

If the market value reflected solely the recorded assets of a company, Tobin's q would be 1.0.
If Tobin's q is greater than 1.0, then the market value is greater than the value of the company's recorded assets. This suggests that the market value reflects some unmeasured or unrecorded assets of the company. High Tobin's q values encourage companies to invest more in capital because they are "worth" more than the price they paid for them.

q = Market value of installed capital / Replacement cost of capital

if Tobin's q is less than 1, the market value is less than the recorded value of the assets of the company. This suggests that the market may be undervaluing the company.

Tobin's discoveries show us that movements in stock prices will be reflected in changes in consumption and investment. Although empirical evidence reveals that his discoveries are not as tight as one would have thought. This is largely because firms do not blindly base investment decisions on movements in the stock price rather they examine the present value of expected profits and future interest rates.
Credit : Wikipedia
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My Opinions
I found q ration of World Market and US Market on www.marketoracle.co.uk that show bottom nearly 1976.

More Undervalue have to beware take over with low price from out side. Now has more big fund out of US buy property and more cheap asset in US. But volume not too much. Why?? This time is chance to collect cheap asset but Firm in us cannot raise fund because all around the world no money. I don't think so.. Why Toyota don't buy GM..

I think US enterprise have more problem that Obama send signal about Ethic...that very correct.

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Relate Information

z-Score Model for Predicting Bankruptcy

First Georgia Community Bank Failed

2008-12-06T03:58:00.000-08:00

FDIC
Press Releases; December 5, 2008

United Bank Acquires All the Deposits of First Georgia Community Bank, Jackson, Georgia

First Georgia Community Bank, Jackson, Georgia, was closed today by the Georgia Department of Banking and Finance, and the Federal Deposit Insurance Corporation (FDIC) was named receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with United Bank, Zebulon, Georgia, to assume all of the deposits of First Georgia Community Bank.

The four branches of First Georgia Community Bank located in Jackson, Covington, Griffin and Locust Grove will reopen on Saturday as branches of United Bank. Depositors of the failed bank will automatically become depositors of United Bank. Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship to retain their deposit insurance coverage. Customers of the failed bank should continue to use their existing branches until further information is received from United Bank.

Over the weekend, depositors of First Georgia Community Bank access their money by writing checks or using ATM or debit cards. Checks drawn on the bank will continue to be processed. Loan customers should continue to make their payments as usual.

Full Press Release about Georgia Bank Failed

This is 23rd of Bank failed of 2008. The bank failed news not strange to customer but only questions

When finished?
How many survive in US recessions?
Government can solved?
Can wait Obama?

FDIC Insured Institutions as of 12/4/2008
(Financial Data as of 9/30/2008 in millions)
Total Commercial Banks & Savings Institutions. amount 8,352 Total Asset 13,573,803 and Total Deposits 8,727,584

Relate Information

Bank Failed List (Count at Subprime Crisis)
Information Georgia Bank Failed from FDIC (How to for Customers)

Laoffs 2008

2008-12-04T18:55:00.000-08:00

Layoffs 2008

The Layoffs 2008
US Crisis, US Recessions Crisis

I get latest new from CNN.

Job cuts mount as year-end nears
AT&T, DuPont, Viacom, Credit Suisse and others take another 22,000-plus jobs out of the work force.
December 4, 2008: 6:51 PM ET
Full about this news
==========================

My Opinions
Big Corporate layoffs AT&T Layoffs, Dupont Layoffs and again....

Bad new never endings.....

I don't like to expect what happen next.......

But This is nature way of Crisis Cycle.

Economics downs-------->Reduce Cost by choose Layoffs-------->Cost reduce in short term
Who make a demand?(People, worker,) that reduce demand-------->Firm cannot survive.

Everyone and Government have to protect this cycle and leave out..

If no, Long Recessions come true ....and may be change somethings that fear........

Adobe Layoffs 2008 - Layoffs for Restructuring to Reduce Expenses

2008-12-04T07:42:00.003-08:00

Adobe Layoffs 2008
Layoffs 600 workers for Restructuring to Reduce Expenses

SAN JOSE, Calif., Dec. 3, 2008 Adobe Systems Incorporated today provided preliminary financial results for its fourth quarter ended Nov. 28, 2008.

Adobe’s fourth quarter revenue target range was $925 million to $955 million, and its fourth quarter diluted earnings per share target ranges were $0.39 to $0.41 on a GAAP basis, and $0.51 to $0.53 on a non-GAAP basis. A reconciliation of preliminary GAAP and non-GAAP financial results is available later in this press release.

“The global economic crisis significantly impacted our revenue during the fourth quarter,” said Shantanu Narayen, president and chief executive officer. “We have taken action to reduce our operating costs and fine-tune the focus of our resources on key strategic priorities.”

The Company cited weaker-than-expected demand for its new Creative Suite 4 family of products that began shipping in Q4 in North America and Europe as the main cause for the shortfall in fourth quarter revenue.

Adobe also announced the implementation of a restructuring program, and has taken steps to reduce its headcount by approximately 600 full-time positions globally. The restructuring will result in anticipated pre-tax charges totaling approximately $44 million to $50 million. The Company expects approximately $28 million to $30 million of the restructuring charges to be recorded in the fourth quarter of fiscal year 2008.

Adobe Press Release Restructuring and Layoffs 2008

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My Comment and Opinions
I don't understand logic's top management. Year 2008, I heard about Big corporate layoffs. After layoffs some corporate go to Bankruptcy or raise fund or bailouts.

What is the most important assets of business firm?

If answer is Customer, Innovation Products, Money, Cash, Shareholder, Supplier, CEO, CFO....
That incorrect.

The most important and most value is human.(Especially Software House company) Reduce expense; have a ton ways to do. (reduce salary of CEO, reduce wages, balance times, reduce junk activity etc...) But 9 in 10 of CEO select layoffs.

They understand everything but CEO only concern dividend of shareholder. This is very wrong and miss... For crisis economics, Shareholder hope to see that firm can survive from crisis. If don't pay dividend this time but can still operate and survive from crisis and no add shares. Shareholder happy. Adobe no problem with cash flow or debts.

Economics Recessions, Cycle of crisis -----Layoffs--->Reduce cost of firms in short terms---->But Firms will lost productivity and heart of remain workers that the firm cannot develop.------>The fear of crisis is when do the same tools(layoffs) Demand will quick reduce -------->that is long time recessions.

Why don't keep and help them... Everyone have a value if everyone will be one heart, can bring the firm to survive...

Relate Information

30 Year Fixed Mortgage Rates below 6 percent

2008-12-01T22:04:00.000-08:00

30 Year Fixed Mortgage Rate
Holiday Gifts for Borrower??

Fell below 6 percent after the Fed announced that buy up to 500,00 of mortgage-backed securities over the next year to year.

November 26, 2008 : Freddie Mac's

McLean, VA – Freddie Mac today released the results of its Primary Mortgage Market Survey (PMMS®) in which the 30-year fixed-rate mortgage (FRM) averaged 5.97 percent with an average 0.7 point for the week ending November 26, 2008, down from last week when it averaged 6.04 percent. Last year at this time, the 30-year FRM averaged 6.10 percent. The 30-year FRM has not been this low since October 9, 2008, when it was 5.94 percent.

Full Press Release
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My Opinions
This is holiday gifts from FED?
For me good actions because it cut cost of consumer but not completely. Refinance and cut interest rate is some of Debt Restructurings. If Gov need to see on better home markets, need full actions. include suspense some payment, bullet payment, expand term etc. that match cash flow of customers

United States Recessions 33rd started Dec 2007

2008-12-01T15:19:00.000-08:00

United States Recessions 33rd
Begin December 2007

Monday December 1, 2008: The National Bureau of Economic Research said that the U.S. has been in a recession since December 2007.

The Business Cycle Dating Committee of the National Bureau of Economic Research met by conference call on Friday, November 28. The committee maintains a chronology of the beginning and ending dates (months and quarters) of U.S. recessions. The committee determined that a peak in economic activity occurred in the U.S. economy in December 2007. The peak marks the end of the expansion that began in November 2001 and the beginning of a recession. The expansion lasted 73 months; the previous expansion of the 1990s lasted 120 months.

A recession is a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in production, employment, real income, and other indicators. A recession begins when the economy reaches a peak of activity and ends when the economy reaches its trough. Between trough and peak, the economy is in an expansion.

Full Announce from NBER and download PDF
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What is NBER

The National Bureau of Economic Research (NBER) is a private, nonprofit research organization dedicated to studying the science and empirics of economics, especially the American economy. It is "committed to undertaking and disseminating unbiased economic research among public policymakers, business professionals, and the academic community." It publishes NBER Working Papers and books. The NBER is located in Cambridge, Massachusetts with branch offices in Palo Alto, California, and New York City.

The NBER was founded in 1920. Its first staff economist and Director of Research was Wesley Mitchell. Simon Kuznets was working at the NBER when the U.S. government asked him to help organize a system of national accounts in 1930, which was the beginning of the official measurement of GDP and other related indices of economic activity. Due to its work on national accounts and business cycles, the NBER is well-known for providing start and end dates for recessions in the United States.

The NBER is the largest economics research organization in the United States. Sixteen of the 31 American winners of the Nobel Prize in Economics have been NBER associates, as well as three of the past Chairmen of the Council of Economic Advisers, including the former NBER president, Martin Feldstein. NBER research is published by the University of Chicago Press.

==========================================
What is Recession

A recession is a contraction phase of the business cycle, or "a period of reduced economic activity." The U.S. based National Bureau of Economic Research (NBER) defines a recession more specifically as "a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in real GDP growth, real personal income, employment (non-farm payrolls), industrial production, and wholesale-retail sales.

Some business & investment glossaries add to the general definition a rule of thumb that recessions are often indicated by two consecutive quarters of negative growth (or contraction) of gross domestic product (GDP).

List of recessions in the United States

According to economists, since 1854, the U.S.A. has encountered 32 cycles of expansions and contractions, with an average of 17 months of contraction and 38 months of expansion. However, since 1980 there have been only eight periods of negative economic growth over one fiscal quarter or more, and three periods considered recessions:

January-July 1980 and July 1981-November 1982: 2 years total
July 1990-March 1991: 8 months
November 2001-November 2002: 12 months
December 2007-?: continuing

From 1991 to 2000, the U.S. experienced 37 quarters of economic expansion, the longest period of expansion on record.
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Effect Announce

Dec 1, 2008 : Down Jones slide %7.70
Good for real information and situation that bring people concern about it and Obama set stimulus package

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Relate Information

Z-Score Model for Predicting Bankruptcy

2008-11-28T06:04:00.000-08:00

Z-Score Formula
The Simple Model for Predicting Bankruptcy

I recalled my memory about financial model for forecast bankruptcy. I can remember Z-Score formula by Altman. I test with original formula. I cannot believe it. This model was developed in 1968 but it work. Modern economist told us, cause of crisis from new financial product and very complicated. Uhhh, they lied me or not. With simple formula from Altman. Everybody can predicted bankruptcy before year end 2007

The Z-Score Formula

The Z-score formula for predicting bankruptcy was developed in 1968 by Edward I. Altman, a financial economist and professor at the Leonard N. Stern School of Business at New York University. The Z-score is a multivariate formula that measures the financial health of a company and predicts the probability of bankruptcy within two years.

Studies measuring the effectiveness of the Z-score have shown the model to be accurate with >70% reliability (Eidleman). The Z-score combines four or five common business ratios using a weighting system calculated by Altman to determine the likelihood of bankruptcy. The weighting system was originally based on data from publicly held manufacturers, but has since been modified for private manufacturing, non-manufacturing and service companies.

The original data sample consisted of 66 firms, half of which had filed for bankruptcy under Chapter 7. All businesses in the database were manufacturers, and small firms with assets of <$1million were eliminated. The original score was as follows:

Z = 1.2T1 + 1.4T2 + 3.3T3 + .6T4 + .999T5.

T1 = Working Capital / Total Assets.
: Measures liquid assets in relation to the size of the company.
T2 = Retained Earnings / Total Assets.
: Measures profitability that reflects the company's age and earning power.
T3 = Earnings Before Interest and Taxes / Total Assets
: Measures operating efficiency apart from tax and leveraging factors. It recognizes operating earnings as being important to long-term viability.
T4 = Market Value of Equity / Book Value of Total Liabilities.
: Adds market dimension that can show up security price fluctuation as a possible red flag.
T5 = Sales/ Total Assets.
: Standard measure for turnover

Altman found that the ratio profile for the bankrupt group fell at -0.25 avg, and for the non-bankrupt group at +4.48 avg.

Zones of Discrimination:

Z > 2.99 = "Safe Zone"
1.8 < 99 = "Grey Zone">
Z < 8 = "Distress Zone">

From about 1985 onwards, the Z-scores have gained acceptance by auditors, management accountants, courts, and database systems used for loan evaluation (Eidleman). It has been used in a variety of contexts and countries, but was designed originally for publicly held manufacturing companies with assets of more than $1 million. Later revisions take into account the book value of privately held shares, and the fact that turnover ratios vary widely in non-manufacturing industries.

Reference:

Restructure Home Mortgage Loans with Refinance

2008-11-26T05:17:00.002-08:00

Stop Home Foreclosures and Help Restructure
or Modify Home Mortgage Loans
with Refinance

Federal Reserve announces it will initiate a program to purchase the direct obligations of housing-related government-sponsored enterprises and mortgage-backed securities backed by Fannie Mae, Freddie Mac, and Ginnie Mae
November 25, 2008
The Federal Reserve announced on Tuesday that it will initiate a program to purchase the direct obligations of housing-related government-sponsored enterprises (GSEs)--Fannie Mae, Freddie Mac, and the Federal Home Loan Banks--and mortgage-backed securities (MBS) backed by Fannie Mae, Freddie Mac, and Ginnie Mae. Spreads of rates on GSE debt and on GSE-guaranteed mortgages have widened appreciably of late. This action is being taken to reduce the cost and increase the availability of credit for the purchase of houses, which in turn should support housing markets and foster improved conditions in financial markets more generally.
Purchases of up to $100 billion in GSE direct obligations under the program will be conducted with the Federal Reserve's primary dealers through a series of competitive auctions and will begin next week. Purchases of up to $500 billion in MBS will be conducted by asset managers selected via a competitive process with a goal of beginning these purchases before year-end. Purchases of both direct obligations and MBS are expected to take place over several quarters. Further information regarding the operational details of this program will be provided after consultation with market participants.
Federal Reserve Press Release
image from Photobucket

My Opinions
Stop or delay home foreclosures and help people to restructure or modify mortgage loan. Refinance is some tools of Debt Restructuring that goods and easy to do. I think this tool very suitable in this times. Because Bank no choice when customer cannot serve payment. They have to do. When more foreclosure, asset value rapid decline that bank will face cash flow and loss that bring to Bankruptcy. Today, a plenty layoffs and very high unemployment. Gov have to more act with package. Please realize this Crisis not from people.

Refinance Model for Modify Mortgage Loan

Government Act: Use Financial Institutions of state to take a delay foreclosure and refinance mortgage loan from people. Flexibilities conditions for new mortgage loan(low and fix interest rate, suspend interest rate payment, suspend principal payment, expand term, etc.) Recommend and advice plan for payment that match income and provide new jobs for them.

People: Study your asset and income. How much can serve payment? What cut expense?

What Benefits: Home will still owner. Asset value don't drop. And no social problem.

If USA government don't do it, I cannot think about the future or way to survive.

FDIC Problem Bank List start Subprime Crisis

2008-11-25T15:34:00.000-08:00

Bank Failed List
Federal Deposit Insurance Corporation
Problem Blank List
Update December 5, 2008

The FDIC is often appointed as receiver for failed banks. This page contains useful information for the customers and vendors of these banks. This includes information on the acquiring bank (if applicable), how your accounts and loans are affected, and how vendors can file claims against the receivership.

I collected Bank Failed list with USA Credit Crisis effect.

Bank Name / Closing Date

Sanderson State Bank, Sanderson, TX----December 12, 2008
Haven Trust Bank, Duluth, GA----December 12, 2008
First Georgia Community Bank, Jackson, GA----- December 5, 2008
PFF Bank and Trust, Pomona, CA------- November 21, 2008
Downey Savings and Loan, Newport Beach, CA------- November 21, 2008
The Community Bank, Loganville, GA------- November 21, 2008
Security Pacific Bank, Los Angeles, CA------- November 7, 2008
Franklin Bank, SSB, Houston, TX ------- November 7, 2008
Freedom Bank, Bradenton, FL ------- October 31, 2008
Alpha Bank & Trust, Alpharetta, GA------- October 24, 2008
Meridian Bank, Eldred, IL ------- October 10, 2008
Main Street Bank, Northville, MI ------- October 10, 2008
Washington Mutual Bank, Henderson, NV and Washington Mutual Bank FSB, Park City, UT ------- September 25, 2008
Ameribank, Northfork, WV ------- September 19, 2008
Silver State Bank, Henderson, NV En Espanol ------- September 5, 2008
Integrity Bank, Alpharetta, GA ------- August 29, 2008
The Columbian Bank and Trust, Topeka, KS ------- August 22, 2008
First Priority Bank, Bradenton, FL ------- August 1, 2008
First Heritage Bank, NA, Newport Beach, CA ------- July 25, 2008
First National Bank of Nevada, Reno, NV ------- July 25, 2008
IndyMac Bank, Pasadena, CA ------- July 11, 2008
First Integrity Bank, NA, Staples, MN ------- May 30, 2008
ANB Financial, NA, Bentonville, AR ------- May 9, 2008
Hume Bank, Hume, MO ------- March 7, 2008
Douglass National Bank, Kansas City, MO ------- January 25, 2008
Miami Valley Bank, Lakeview, OH ------- October 4, 2007
NetBank, Alpharetta, GA ------- September 28, 2007
Metropolitan Savings Bank, Pittsburgh, PA ------- February 2, 2007

Source : FDIC Problem Bank Lists
----------------------------------------------------
FDIC Background
The Federal Deposit Insurance Corporation (FDIC) is a United States government corporation created by the Glass-Steagall Act of 1933. It provides deposit insurance which guarantees the safety of checking and savings deposits in member banks, currently up to $250,000 per depositor per bank. On January 1, 2010, the standard coverage limit will return to $100,000 for all deposit categories except IRAs and Certain Retirement Accounts, which will continue to be insured up to $250,000 per owner. The vast number of bank failures caused by runs on the bank in the Great Depression spurred the United States Congress to create an institution to guarantee deposits held by commercial banks, inspired by the Commonwealth of Massachusetts and its Depositors Insurance Fund (DIF).

The FDIC insures accounts at different banks separately. For example, a person with accounts at two separate banks (not merely branches of the same bank) can keep $250,000 in each account and be insured for the total of $500,000. Also, accounts in different ownerships (such as beneficial ownership, trusts, and joint accounts) are considered separately for the $250,000 insurance limit. Under the Federal Deposit Insurance Reform Act of 2005, Individual Retirement Accounts are insured to $250,000.

Credit Background: Wikipedia

Citigroup Bailout Reflection

2008-11-25T10:16:00.000-08:00

Citigroup Bailout
Reflection

I check reflect from Citigroup Bailout. I found 9 in 10 that shown good news. I very strange for this effect. The world market until don't understand problem. USA no action plan or full plan and don't know about Financial Institution status. Citigroup got $20 billion, how about 50,000 layoffs. If Gov know that will rescue Citigroup, have to not layoffs plan. Layoffs is catalyst of the cycle of problem. again again.

Reflect of Citigroup Bailout

Bush defends Citigroup bailout(Video)
BBC News, UK
President Bush has defended the US Treasury's decision to invest $20bn (£13.4bn) in the troubled banking group Citigroup.

Citigroup bailout breeds relief, caution
AFP
"But uncertainty remains over what will happen next as no-one had thought that Citigroup would need such a bailout." Citigroup's shares had slumped last ...

Citigroup Bailout Spurs Buying
Wall Street Journal
"Markets may attempt to continue to trade off positive sentiment from the bailout of Citigroup but it remains to be seen if this is going to be more ...

Thumbs Up for the Citigroup Bailout
Wall Street Journal
By EUGENE A. LUDWIG The Citigroup agreement unveiled yesterday shows we are finally seeing strong medicine administered to halt the disease ravaging our ...

World stocks surge after Citigroup bailout
The Associated Press
LONDON (AP) — World stock markets stormed higher Monday on the back of investors buoyed by the rescue of Citigroup and the announcement of President-elect ...

Stocks Rise in Early Trading on Citigroup Bailout Plan
Washington Post, United States
By Renae Merle Stocks rallied in early trading today after a government plan to bailout Citigroup, one of the nation's largest banks, emerged over the ...

Citigroup Bailout May Assist More Homeowners
ABC News
By ALICE GOMSTYN The government's rescue package for struggling banking behemoth Citigroup won't just shore up the firm's balance sheet -- it could also ...

Good bailout or bad bailout?
Boston Globe, United States - 12 hours ago
The new Citigroup bailout does require the firm to follow a wise plan by the Federal Deposit Insurance Corp. to modify the terms of certain mortgages. ...

More about Citigroup Bailout news

Independent Mortgage Advisors

2008-11-22T04:35:00.000-08:00

What is Independent Mortgage Advisors

Independent Mortgage Advisors same as Independent Financial Advisers or IFAs are professionals who offer independent advice on financial matters and recommend suitable financial products from the whole of the market. (Now, need advice for mortgage restructuring or loan modification; For USA Financial Crisis can apply from UK for help home owner and help jobless in financial industry)

The term was developed to reflect a UK regulatory position and has a specific UK meaning, although it has been adopted in other parts of the world.

The term "Independent Financial Adviser" was coined to describe the advisers working independently for their clients rather than representing an insurance company, bank or bancassurer. At the time (1988) the UK government was introducing the polarisation regime which forced advisers to either be tied to a single insurer or product provider or to be an independent practitioner. The term is commonly used in the United Kingdom where IFAs are regulated by the Financial Services Authority (FSA) and must meet strict qualification and competence requirements.

In the UK the industry has been de-polarised since 2005. There are now three main classes of adviser: tied advisers (working for one financial institution), multi-tied advisers (offering products from a selection of the market and usually paid on a commission basis) and independent financial advisers. Independent financial advisers must offer their clients the option to pay for advice by fee as an alternative to commission.

Paying for advice

To encourage client's awareness of the cost of advice, and to stimulate a market in advice, the FSA has introduced a new disclosure regime for advisers giving regulated investment advice. Since July 2005 this regime insists that advisers who market themselves as independent must offer the option of paying a fee for advice. The three main remuneration options available are as follows:

Commission: Traditionally the most common way to pay for advice is for the IFA to receive a commission from the product provider. The amount of commission must be disclosed, and some IFAs will rebate a portion of their commission, particularly in Execution-Only cases. The amount of commission and whether it is deducted from the amount you actually invest or is included in the cost of the investment varies from product to product. The client pays for commission from product charges so it does not represent 'free advice'. As well as the initial commission, the adviser is likely to be also paid an annual "trail" commission by the product provider. Not all products offer the same rate of trail commission and therefore a potential conflict of interest may arise. The products making the highest management charges usually offer the adviser the highest trail commission.
Fees: Less common than commission, all IFAs must offer the option of working for a fee. Depending on the size and type of the investment, and the complexity of the advice, this can work out cheaper than paying commission. Paying a fee for advice is the best way to ensure that the advice is impartial and there is no incentive for the IFA to recommend a product solution.
Combination: It is also possible to pay a combination of fees and commission. In this situation the IFA will rebate a proportion of the commission they would have been due in a commission-only scenario.

Qualifications

To offer financial advice an individual must represent or be an appointed representative of a firm registered with the Financial Services Authority (FSA). The FSA require that firms ensure that individuals acting for them have appropriate qualifications. The list of appropriate qualifications is determined by the Financial Services Skills Council at the behest of the FSA.

The qualifications for most firms relate to Chartered Insurance Institute (CII) exams past and present.

The entry level is normally the historic 'Financial Planning Certificate' (FPC), or its successor, the 'Certificate in Financial Planning' (CFP) which includes an additional examination focusing on investment advice and risk. For the payment of a fee to the Personal Finance Society members with this level of qualification may use the CertPFS designation. The exams to achieve this are certificate level as designated by the Qualifications and Curriculum Authority (QCA) each exam is approximately equivalent to a GCSE (five for CFP and three for FPC).

The next level is the historical 'Advanced Financial Planning Certificate' (AFPC) and newer 'Diploma in Financial Planning' (DFP). Again for a fee members of the Personal Finance Society may use the designation DipPFS.

The next level is 'Advanced Diploma in Financial Planning'.

The highest level is 'Certified Financial Planner' (CFP) issued by the Institute of Financial Planning or Chartered Financial Planner status recently introduced by the CII.

If things go wrong

Financial services are heavily regulated in the United Kingdom. While this may in some cases restrict the market and places a heavy burden on financial services professionals, it also makes for one of the safest consumer markets in the world.

If a client buys a financial product on the advice of an IFA which turns out to be unsuitable, they have the right to complain and, if the complaint is upheld, may receive compensation. All regulated financial services companies, including IFAs must have effective internal complaint handling procedures. If a complaint is not dealt with satisfactorily internally, the client has the option of going to the Financial Ombudsman Service, which will conduct an independent investigation and has the power to award compensation if warranted. It should be noted that in a large majority of cases referred to the Ombudsman, it finds that the firm had treated the customer’s complaint fairly.

This does not mean that a client can claim compensation simply because an investment loses money. With all investments, there is an element of risk, the basis for complaint would only be whether or not that level of risk was unsuitable for a particular client based on the information given to the adviser. This is particularly important (and not well-understood in the public consciousness), and especially in relation to the sale of with profits endowments intended to be used to repay an interest only mortgage. A great many people saw strongly reduced investment returns from their endowments due to lower interest rates (and hence investment returns) and subsequently claimed that they had been mis-sold. While the poor performance is regrettable, it in no way constitutes mis-selling in the legal sense unless it can be shown that the endowment was unsuitable for the client's needs at the time it was advised. It is not possible to use retrospective judgements to assess decisions made in good faith in the past either.

Credit: Wikipedia

PFF Bank, Downey Savings and The Community Bank Fail

2008-11-22T03:14:00.000-08:00

PFF Bank, Downey Savings and The Community Bank Fail
By FDIC
November 21, 2008

The Federal Deposit Insurance Corporation(Regulators) close down two California thrifts and Community Bank of Loganville, Ga., raising the toll in the financial crisis to 22 banks.
bringing to 22 the number of institutions forced to close in the wake of the financial crisis.

Closing Downey Savings & Loan Association and PFF Bank & Trust
Official Press Releases

U.S. Bank Acquires All the Deposits of Two Southern California Institutions
Downey Savings & Loan Association, Newport Beach and PFF Bank & Trust, Pomona

U.S. Bank, National Association, Minneapolis, MN, acquired the banking operations, including all the deposits, of Downey Savings and Loan Association, F.A., Newport Beach, CA, and PFF Bank & Trust, Pomona, CA, in a transaction facilitated by the Federal Deposit Insurance Corporation.

The combined 213 branches of the two organizations will reopen as branches of U.S. Bank under their normal business hours, including those with Saturday hours. Depositors will automatically become depositors of U.S. Bank. Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship to retain their deposit insurance coverage.

Customers of both banks should continue to use their existing branches until U.S. Bank can fully integrate the deposit records of the organizations. Over the weekend, depositors can access their money by writing checks or using ATM or debit cards.

Acquires The Community Bank Official Press Releases

Bank of Essex, Tappahannock, Virginia Acquires All the Deposits of The Community Bank, Loganville, GA

The Community Bank, Loganville, Georgia, was closed today by the Georgia Department of Banking and Finance, and the Federal Deposit Insurance Corporation (FDIC) was named receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Bank of Essex, to assume all of the deposits of The Community Bank.

Relate Information

Full Press Release CA / GA
Don't confuse for customer include deposit and loan read Fail Bank Information from FDIC include: Press Release, Acquiring Financial Institution, Question and Answer Guide, Banking Services, Loan Customers, Possible Claims Against the Failed Institution, Priority of Claims, Dividend Information and Brokered Deposits

Global Trends 2025 - A Transformed World

2008-11-21T04:07:00.000-08:00

Global Trends 2025
The National Intelligence Council's 2025 Project
With DS Blog Opinion

"Global Trends 2025: A Transformed World" is the fourth unclassified report prepared by the National Intelligence Council (NIC) in recent years that takes a long-term view of the future. It offers a fresh look at how key global trends might develop over the next 15 years to influence world events. Our report is not meant to be an exercise in prediction or crystal ball-gazing. Mindful that there are many possible "futures," we offer a range of possibilities and potential discontinuities, as a way of opening our minds to developments we might otherwise miss.
From the Chairman of the National Intelligence Council

Some of Preliminary Assessments Highlighted of Global Trends 2025

The whole international system—Brazil, Russia, India and China will have a seat at the international high table and bring new stakes and rules of the game.

My Opinion: Everybody already know its not wait 2025. In 2010 China Russia India is the Power Country

The unprecedented transfer of wealth roughly from West to East now under way will continue for the foreseeable future.

My Opinion: I agree but realized about value of money. If US dollar and Euro not core currency, will no food. Only new technology and innovation that east not experts(except Taiwan, Korea and Japan)

Pressure on resources—particularly energy, food, and water—raising the specter of scarcities emerging as demand outstrips supply.

My Opinion: I agree but not wait 2025, This year world still no food for poor country.

The potential for conflict will increase owing partly to political turbulence in parts of the greater Middle East.

Other projections in Global Trends 2025 include: A worldwide shift to a new technology that replaces oil will be under way or accomplished by 2025. The likelihood that nuclear weapons will be used will increase with expanded access to technology and a widening range of options for limited strikes. The impact of climate change will be uneven.

A full copy of the report is available online at: http://www.dni.gov/nic/NIC_2025_project.html

I agree with DNIC but they only project the world but don't watch themselves. They don't think about site crash from over traffics when launched new Global Trend version. I can not check full information!!!!!!!!!! (sometimes I can believe them or not)
What will be Power Country in the futures? I think the major factors on NIC is simples and more depend on resources(about of people:China, India, Oil:Russia, Weapon:Nuclear) But World War I and II not from big resources country but from leader.

-----------------------------------------------------------------
Director of National Intelligence Background

Office of the Director of National Intelligence
Formed: April 22, 2005
Jurisdiction: Federal Government of the United States
Headquarters: Washington, DC
Employees: Approximately 1,500
Annual Budget: 43.5 Billion Dollars (US Intelligence Community Budget Figure)
Agency Executives: John Michael McConnell, Director of National Intelligence
Donald Kerr, Principal Deputy Director of National Intelligence
Website: www.dni.gov

The Director of National Intelligence (DNI) is the United States government official subject to the authority, direction and control of the President who is responsible under the Intelligence Reform and Terrorism Prevention Act of 2004 for:

Serving as the principal adviser to the President, the National Security Council, and the Homeland Security Council for intelligence matters related to the national security;
Serving as the head of the sixteen-member Intelligence Community; and
Overseeing and directing the National Intelligence Program.

Credit Background: Wikipedia Image from Photobucket
Relate Information: A full copy of Global Trends 2025 Download at: http://www.dni.gov/nic/NIC_2025_project.html

What is P2P Lending

2008-11-20T03:18:00.000-08:00

What is P2P Lending
(Person-to-Person Lending or Peer to Peer Lending or Peer to Peer Loan)

When high consumer bankruptcy , Be careful dark P2P lending will make social problem. Because high interest rate and mafia. P2P Lending market in 2005, there were $118 million of outstanding peer-to-peer loans. In 2006, there were $269 million, and, in 2007, a total of $647 million. The projected amount for 2010 is $5.8 billion.
(Not waiting 2010, In 2008-9, I expected more $7 billion)

P2P Lending (also known as peer-to-peer lending and social lending) is, in its broadest sense, the name given to a certain breed of financial transaction which occurs directly between individuals ("peers") without the intermediation/participation of a traditional financial institution. An enabling technology for person-to-person lending has been the Internet, where person-to-person lending appears in two primary variations: an "online marketplace" model and a "family and friend" model.

P2P Lending Type
The Marketplace Model
Person to Person Lending on the internet enables individual lenders to locate individual borrowers and vice-versa. This model connects borrowers with lenders through an auction-like process in which the lender willing to provide the lowest interest rate "wins" the borrower's loan. The marketplace process may include other intermediaries who package and resell the loans, but the loans are ultimately sold to individuals or pools of individuals.

The "family and friend" Model
forgoes the auction-like process entirely and concentrates on borrowers and lenders who already know one another, as with two (or more) friends or business colleagues formalizing a personal loan. Whereas the primary benefit of the marketplace model is the "match making" aspect, the family and friend model emphasizes online collaboration, loan formalization and servicing.

P2P Lending Type (P2P Loan Type)
Can be every type of loan

Peer to Peer Lending International
Peer to Peer Student Loans
P2P Personal Loans
P2P Business Loans

P2P Lending Amount Cost Rate etc.

Amount $25,000-$50,000
Terms: 3-10 Years
Interest Rates 7.00 - 30.00%
May be need Co-Signed Loans or Guarantee
Fees: 0.75% - 6.90%
Late Payment Fees: $5-15 or 5% of payment due

Credit: Wikipedia
Image from Amazon.com (Book: Happy About People-to-People Lending With Prosper.com: How to Lend Money to Friends You've Never Met by Roger Steciak)

Talbots Closings Stores - USA Crisis Effect

2008-11-18T16:00:00.000-08:00

Talbots Closing Stores Plan
USA Crisis

Will Talbots Closing All Stores? This is bad news for Holiday Gifts Season or 2008 Black Friday...
Talbots already closed 22 stores, 2 percent of its total. Today, I got rumors about Talbots closing all stores plan. But in latest news or company press released only close some store and The Talbots, Inc. to Broadcast Third Quarter 2008 Earnings Results Conference Call on the Web.

HINGHAM, Mass., Nov 18, 2008 (BUSINESS WIRE) -- The Talbots, Inc. (NYSE: TLB) invites investors to listen to a broadcast of the Company's conference call to discuss third quarter 2008 earnings results. The conference call will be broadcast live on Tuesday, November 25, 2008 at 10:00 a.m. Eastern Time
more about this Talbots press room..

Talbot Background
Operating under the brands Talbots and J. Jill, The Talbots, Inc. is a leading international specialty retailer, cataloger and e-tailer of women's classic apparel, shoes, and accessories. At the end of fiscal year 2007, the Company operated a total of 1,421 stores in 47 states, the District of Columbia, Canada, and the UK, with 1,150 stores under the Talbots brand name and 271 stores under the J. Jill brand name. Its direct-marketing operation circulated approximately 126 million catalogs worldwide in fiscal 2007, with 48 million under the Talbots brand name and 78 million under the J. Jill brand name. Talbots brand on-line shopping site is located at [www.talbots.com] and the J. Jill brand on-line shopping site is located at [www.jjill.com].

The Talbots, Inc. currently employs a combined total of approximately 16,000 associates worldwide, including 12,300 associates at Talbots and 3,700 at J. Jill.

Talbots assortment for women features modern classic styles in apparel, shoes and accessories, providing head-to-toe wardrobing for all occasions--from work, to weekend, to special occasion. The merchandise is offered across several Talbots retail concepts, including Talbots Misses, Talbots Petites, Talbots Woman, Talbots Woman Petites, and Talbots Collection.

In addition to its line for women, which is available throughout the U.S., Canada and the UK, Talbots offers classic children’s clothing through Talbots Kids and classic sportswear for men through Talbots Men's.

Credit Background: Wikipedia

Relate Information

Citigroup layoff more 50000 jobs

2008-11-17T07:00:00.000-08:00

Citigroup to cut more than 50,000 jobs
Citigroup said Monday it planned to cut more than 50,000 jobs, the latest move by the struggling bank to cut costs in order to weather the credit crisis plaguing Wall Street
News from November 17, 2008:America's Money Crisis CNN Money

Citigroup Background
Citigroup Inc., doing business as Citi, is a major American financial services company based in New York City, NY. Citigroup was formed from one of the world's largest mergers in history by combining the banking giant Citicorp and financial conglomerate Travelers Group on April 7, 1998. Citigroup Inc. has the world's largest financial services network , spanning 107 countries with approximately 12,000 offices worldwide. The company employs approximately 358,000 staff around the world, and holds over 200 million customer accounts in more than 100 countries. It is the world's largest bank by revenues as of 2008. It is a primary dealer in US Treasury securities[8] and its stock has been a component of the Dow Jones Industrial Average since March 17, 1997.[9] Its single largest shareholder is Prince Al-Waleed bin Talal of Saudi Arabia, who has a 4.9% stake.[10] As of December 11, 2007, Vikram Pandit is Citigroup's current CEO, while Sir Win Bischoff the current chairman.
Credit Background: Wikipedia

My Opinion
This is signal of bankruptcy again and again for USA Big Corporate. When business into crisis first things CEO do is layoffs. I don't understand with logic and tools. Tools for manage business have a tons but they choose layoffs is one. I set up my consense this is signal of Citigroup Bankurptcy
Citigroup Bankruptcy

GM Bankruptcy : The Big Domino Crisis

2008-11-14T22:25:00.000-08:00

Will GM declare to Bankruptcy?

If General Motors declares to bankruptcy, auto industry will hard crash and Japanese will be Big and Big for World Auto.

General Motors Corporation (GM) is a multinational automobile manufacturer founded in 1908 and headquartered in the United States. GM is the world's second largest automaker as measured by global industry sales. As of 2008, General Motors employs about 266,000 people around the world. It manufactures its cars and trucks in 35 different countries and sells them under the brands of Buick, Cadillac, Chevrolet, GM Daewoo, GMC, Holden, Hummer, Opel, Pontiac, Saab, Saturn, Vauxhall, and Wuling. General Motors is the ninth largest publicly traded company in the world (ranked by revenue on the Fortune Global 500 list.) In recent years however, the company has endured significant financial turmoil, including a 38 billion dollar loss in 2007.

On October 10, 2008, it was revealed that GM may exchange its remaining 49% stake in GMAC to Cerberus Capital Management for Chrysler LLC, potentially merging two of Detroit's "Big Three" automakers. Merger talks involving Chrysler were suspended, however, before
November 7, 2008, as part of a broader response to the increasing urgency of GM's own cash flow problems.

My Opinions
Cash Flow Problems is problem of GM. Why???? I will back to financial theory. All CEO in USA use it "The Maximize Shareholder Wealth". Why? Auto Industry chance to got cash more and more. Why Toyota not effect? Why Toyota payback for debt in crisis. This Theory if need high return or maximize

CEO will keep High D/E Ratio can bring High Return
Cash received from core business, CEO will invest in non-core business

All of all USA Gov cannot leave GM to Bankruptcy because GE will come together. That Global Economic crash

Hopenow.com - Home Counselors

2008-11-12T12:44:00.000-08:00

Hopenow.com Home Counselors
Mortgage Loan Help for Home Owners
The HOPE NOW Hotline, 888-995-HOPE (4673)

Hopenow.com is a counseling service provided by the Homeownership Preservation Foundation. A counselor will work with you to find a solution. They are an independent nonprofit that provides a platform for HUD-approved counselors to work with servicers.

Counselors from Hopenow are experts in foreclosure prevention and trained to set up a plan of action designed just for you and your situation.

Some Comment from customers

"They treated me with dignity and I am grateful for the assistance."

"My husband and I want to thank , especially and HOPE NOW for the chance to stay in our home! We appreciate you and thank you again!I would definitely recommend HOPE NOW to anyone who is seeking help."

My Opinions
This is very good help site for home owners. When someone into crisis they need to talk with experts. But I think this is not enough for help. In crisis need to delay or don't force debtor because when creditor have problem they will forced debtor. This is start new problem of credit crisis cycle again and again. Gov should be take this action and more for prevent property value and people. Gov must realize cause of crisis not from people but from Financial Institutions and Government Policy. USA crisis need economics recovery and prevent plan package.(not only money and advice)

1997 In Asia, they set up debt counselor center for free advice. Not work for debts because they cannot do more than advice. But work for support labor from Financial Institutions that failure.

Relate Information

Hopenow.com and The Office of Homeownership Preservation
Asset Management Company
How to get help with your mortgage

National Asset Management Company

2008-11-12T02:57:00.000-08:00

National Asset Management Company
one of for way out of USA Crisis

When The Country face economic crisis, debt or loan will quickly come to big problem because no jobs, no cash, high interest rate and value of asset declined. For Big crisis, all size enterprise cannot solve debt by themselves.

Government have to help somethings. Year 1997, Thailand economic crisis, Gov cannot support a lot of debt trouble in financial institutions with printed more money. Because value of money will no value.

Thailand and Malaysia support debt problem with National Asset Management Company.

What is Asset Management Company
Asset management company (AMC) is investment management firm and special purpose or with the stated investment objectives. AMC will take more action. In Thailand and Malaysia they have to solved by

Transfer of problem debt(Non Performing Loan) from financial institutions
Financing and resolution of problem loans and assets
Expert management of problem loans through reconstruction and rehabilitation
Specialist management of loan security (real estate, shares, etc.)
Management of the process by objective not maximize shareholder wealth but help debtors or financial institutions that got effect from country crisis
Have special code for act from Government : can reduce loan, give new loan, Acquisition of assets, Rehabilitation, paid for transfer with bond etc. (in South East Asia country take debt problem portfolios more than $40,000 mil. with cash $30 mil.)

Key Success Factors of AMC

Transparency
Equal opportunity for investors
Professionalism
Best practice
Independence

AMC can help for Debts problem and recovery economic but you know something

1997, A lot of Asia Country paid more money for advisory from USA.

and advisory is Lehman Brothers.......

Relate information and News

WSJ Nov 12, 2008 Treasury Not Planning to Buy Bad Loans, Assets

What is Missingmoney.com

2008-11-10T14:36:00.000-08:00

What is Missingmoney.com

Missingmoney.com is the ACS Unclaimed Property Clearinghouse a service of Affiliated Computer Services, Inc., dba ACS Unclaimed Property Clearinghouse, a Delaware corporation ("ACS"), the company that operates the Web Site. ACS may hire third-party vendors to assist in the administration of the Web Site, such as processing, storage, and handling user/Member information or in relation to the processing of Member communications.

MissingMoney.com collect a database of governmental unclaimed property records.
The governmental safeguard your money and return lost funds Common types of unclaimed property include:

Bank accounts and safe deposit box contents
Stocks, mutual funds, bonds, and dividends
Uncashed checks and wages
Insurance policies, CD's, trust funds
Utility deposits, escrow accounts

MissingMoney.com provide data and searches are free of charge. Data is refreshed monthly.

Relate information

Interview MissingMoney.com Video From YouTube

Obama Stimulus Package Plan

2008-11-07T22:55:00.000-08:00

First job of New President
Obama Stimulus Package Plan

First priority job for new President is call stimulus package plan. This is good signal for recovery economics. I check on update news for detail President Stimulus Package Plan but nothing. I expect will similar plan on January 13, 2008

Barack Obama's Plan to Stimulate the Economy and Protect American Families Would:

Provide an immediate $250 tax cut for workers and their families.
Provide an immediate, temporary $250 bonus to seniors in their Social Security checks.
Provide an additional $250 tax cut to workers and an additional $250 to seniors if the economy continues to worsen
Provide relief to homeowners hit by the housing crisis.
Provide aid to states hardest-hit by the housing crisis to avoid a slash in services.
Extend and expand Unemployment Insurance.

Barack Obama's economic stimulus plan will inject $75 billion of stimulus into the economy.
Download Obama Stimulus Package (Pdf)
image from: Photobucket

My Opinion
This is good signal and first help for people in USA crisis. I no problem with this package. But I don't see plan for stop decline and recovery economic..... Next things to do should be

What is cause of USA Credit Crisis?

Video Obama Speaks Out for Stimulus to Create Jobs

Relate Information

Consumer Bankruptcy Guideline

2008-11-06T03:38:00.000-08:00

Consumer bankruptcies soar in October 2008

Personal bankruptcy filings soared 40 percent in October 2008 and expected to climbing as home values sink and individual debts balloon.
U.S. consumers filed some 106,266 bankruptcies in October, up 40 percent from a year ago and up 20 percent from September.

"We expect the numbers will continue to go up," said ABI Executive Director

Reporting by Chelsea Emery; editing by Jeffrey Benkoe
More about this New.....

This is credit crisis or economic crisis development. When financial fail after real business or industry cannot find cash or was freezes credit line. They cannot run business and first things tools from CEO is lay off and bring to personal bankruptcy.

But personal bankruptcy maybe not bad ways for this times why not... If you read this story from ABI (American Bankruptcy Institute)

Should I file for bankruptcy?

Whether to file for bankruptcy is a very personal decision. Some people do not have any assets over and above what the law allows them to keep, even if they do not pay their creditors. If this is true of you, then you may not need a bankruptcy in order to protect your assets.

Some people find it helpful to file a bankruptcy case anyway because their financial situation is causing them emotional distress or depression, or because they would like to free themselves of debt now, if legally allowed, and have their income and assets to themselves in the future. Also, some people may find that a bankruptcy is worth filing even if they do lose some of their assets.

Throughout this section of the Consumer Bankruptcy Center, ABI will try to help you decide if bankruptcy is for you.

Considering Bankruptcy Checklist

* Your wages have been garnished or your bank account has been attached
* Most of your debts are unsecured debts like credit card bills, hospital bills, etc.
* Your total debt, not including your car or house loan, is more than you could pay, even over five or more years
* Collection agencies are calling you at home and/or at work
* Your payments are more than 30 days behind on more than one bill
* There are lawsuits pending against you
* You have high medical bills not covered by insurance
* You owe income taxes that you are currently unable to pay
* You have few assets
* You have little or no savings

People who have had their wages garnished can especially benefit from a bankruptcy because the bankruptcy will stop the garnishment and could potentially help you get some of the garnished money back.

A law passed in 2005 makes it more complicated to file for bankruptcy and to be freed of past debts.

Thank ABI more about ABI guideline

Circuit City Store Closing Lists - USA Credit Crisis Affect

2008-11-03T10:15:00.000-08:00

USA Credit Crisis Affect
Circuit City Store Closing

Circuit City Stores, Inc. Provides Update on Liquidity and Announces Store Closing Plan

Plans to Close 155 Stores and reduce new store openings
Announces Ongoing Evaluation of Additional Cost Reduction Initiatives and Is Considering All Options and Alternatives to Restructure its Business
Plan to lay off 17% of its workforce by the end of the year as a result of continually struggling to remain profitable.

My Opinion..Why all business got effect from economic crisis will first take action with lay off tools. They have many many tool for existing business. This is wrong goals or mistake understand of Financial Theory that have to do "maximize shareholder wealth". All top management try to kill themselves with short term maximize. My model I will do other tool first and try keep my labor or my friends. In crisis we need to join and share idea that only way for take a business past big crisis. This is mistake or wrong theory about Financial "maximize shareholder wealth" theory may be this is cause of USA Crisis or World Crisis...

Circuit City Stores Closing News
RICHMOND, Va., Nov 03, 2008 /PRNewswire-FirstCall via COMTEX News Network/ -- Circuit City Stores, Inc. (NYSE: CC) today provided an update on its liquidity position and its previously announced ongoing comprehensive business review. Due in part to its deteriorating liquidity position and the continued weak macroeconomic environment, the company has decided to take certain restructuring actions immediately, including closing 155 domestic segment stores, reducing future store openings and aggressively renegotiating certain leases. The company also is considering all available options and alternatives to restructure its business.

More about Circuit City Store Closing....official site

Circuit City Stores, Inc. Background

Circuit City (NYSE: CC) is an American dealer and retailer in brand-name consumer electronics, personal computers, and entertainment software. Circuit City is a Fortune 500 company.Circuit City operates over 670 Superstores and 13 other locations in USA and Puerto Rico. Circuit City Superstores range in size from 15,000 to 45,000 square feet (1400 to 4000 m²) and offer a large selection of brand-name consumer electronics, personal computers and entertainment software.

Circuit City also has over 850 retail stores and dealer outlets in Canada. Circuit City's locations in Canada are operated by InterTAN Canada Ltd which Circuit City acquired on May 19, 2004. InterTAN runs The Source by Circuit City chain in Canada (some of them now called La Source in Quebec).

Former president, CEO and chairman of the board of directors Richard Sharp will be inducted into the Consumer Electronics Hall of Fame in October, 2008.

Credit Background: Wikipedia

Circuit City Stores Closing List (will close by Dec. 31, 208)

ALABAMA: Anniston, Trussville
ARKANSAS: Fayetteville
ARIZONA: Avondale, Chandler, Gilbert, Goodyear, Mesa (2), Peoria, Phoenix (4), Queen Creek, Scottsdale
CALIFORNIA: City of Industry, Compton, Concord, Dublin, Escondido, Fairfield, Fontana, Foothill Ranch, Fremont, Merced, Mira Loma, Moreno Valley, Morgan Hill, Murrieta, Palo Alto, Pittsburg, Pomona, Richmond, Riverside, San Rafael, Santa Barbara, Santa Maria, Thousand Oaks, Vista

more list go to ap.google.com

Relate Story

Update Nov 10, 2008

Circuit City files for bankruptcy protection
Pressure from vendors and consumers, Circuit City Stores Inc. filed for bankruptcy protection .

more about Circuit City Bankruptcy News

Credit Card Debt Background - I

2008-10-23T07:51:00.000-07:00

I would like to talk about Credit Card background before credit card promblem.

Credit Card Background

A credit card is part of a system of payments named after the small plastic card issued to users of the system. The issuer of the card grants a line of credit to the consumer (or the user) from which the user can borrow money for payment to a merchant or as a cash advance to the user. A credit card is different from a charge card, which requires the balance to be paid in full each month. In contrast, credit cards allow the consumers to 'revolve' their balance, at the cost of having interest charged. Most credit cards are issued by local banks or credit unions, and are the same shape and size, as specified by the ISO 7810 standard.

How work

Credit cards are issued after an account has been approved by the credit provider, after which cardholders can use it to make purchases at merchants accepting that card.

When a purchase is made, the credit card user agrees to pay the card issuer. The cardholder indicates his/her consent to pay, by signing a receipt with a record of the card details and indicating the amount to be paid or by entering a Personal identification number (PIN). Also, many merchants now accept verbal authorizations via telephone and electronic authorization using the Internet, known as a 'Card/Cardholder Not Present' (CNP) transaction.

Electronic verification systems allow merchants to verify that the card is valid and the credit card customer has sufficient credit to cover the purchase in a few seconds, allowing the verification to happen at time of purchase. The verification is performed using a credit card payment terminal or Point of Sale (POS) system with a communications link to the merchant's acquiring bank. Data from the card is obtained from a magnetic stripe or chip on the card; the latter system is in the United Kingdom and Ireland commonly known as Chip and PIN, but is more technically an EMV card.

Other variations of verification systems are used by eCommerce merchants to determine if the user's account is valid and able to accept the charge. These will typically involve the cardholder providing additional information, such as the security code printed on the back of the card, or the address of the cardholder.

Each month, the credit card user is sent a statement indicating the purchases undertaken with the card, any outstanding fees, and the total amount owed. After receiving the statement, the cardholder may dispute any charges that he or she thinks are incorrect (see Fair Credit Billing Act for details of the US regulations). Otherwise, the cardholder must pay a defined minimum proportion of the bill by a due date, or may choose to pay a higher amount up to the entire amount owed. The credit provider charges interest on the amount owed (typically at a much higher rate than most other forms of debt). Some financial institutions can arrange for automatic payments to be deducted from the user's bank accounts, thus avoiding late payment altogether as long as the cardholder has sufficient funds.

Credit: Wikipedia

The National Debt Clock

2008-10-10T05:14:00.000-07:00

National Debt Clockgreat free widgetsWidgetbox

USA National Debt Clock Widgets

The U.S. National Debt Clock is a billboard-sized display installed at the Avenue of the Americas in Manhattan which is constantly updated to show the current United States public debt and each family's share. Invented and sponsored by New York real estate developer Seymour Durst, it was installed in 1989. After Seymour's death in 1995, his son Douglas Durst became president of the Durst Organization which owns and maintains the clock.

What is the National Debt?

The national debt is money owed by the U.S.A. federal government to creditors. A portion of the national debt is held by the public in the form of Government Bond.(treasury bills, treasury notes, US savings bonds, and state and local government series securities) That mean everyone have debt.

Why Have a National Debt?

Because spending, every country or gorverment spend more money than the treasury brings in in taxes. And a lot of money have to support Financial Institution and big company that bankruptcy.

Where to go for Help With Debt Problems

2008-10-01T04:58:00.000-07:00

Where to go for help with debt problems
For Free I never heard..

If you're in problem with debt. You have to seriously study and separate your statement or Financial Statement and Balance Sheet that you will see solutions.

Balance Sheet
Step1. Assets: collect and separate what your assets (Housing Jewery Land Car bond etc.) and evaluate them.
Step 2. Debt: Make a list of everything your debt and installment (Credit Card Mortgage Loan..)

Income and Expense
Step 3. How many incomes per months
Step 4. List all your expense.(exclude interest pay for debt)

How to solved problem
1.Income should be more Expense if less than that Big Problem you have to cut daily expenses or find more incomes.
2.How many after Income after expense and can support debts
- if can support only interest goto creditors request reduce installments
- Debt consolidation
- more...

Thailand Crisis and USA Crisis in Credit Crisis - I

2008-09-20T12:15:00.001-07:00

Tom Yum Kung and Hamburger Crisis
Different cause but The Same in Crisis Developing

Tom Yum Kung Crisis
In 1997 had Financial Crisis in Asian (South East Asia) that known in Tom Yum Kung Crisis or IMF crisis. The Asian Financial Crisis was a period of financial crisis that gripped much of Asia beginning in July 1997, and raised fears of a worldwide economic meltdown (financial contagion). It is also commonly referred to as the IMF crisis although the blame largely rests with the fixed-exchange rate regimes within the Asian countries themselves which was not a recommendation of the IMF.

Cause and Overview of Tom Yum Kung Crisis
The crisis started in Thailand with the financial collapse of the Thai baht caused by the decision of the Thai government to float the baht, cutting its peg to the USD, after exhaustive efforts to support it in the face of a severe financial over extension that was in part real estate driven. At the time, Thailand had acquired a burden of foreign debt that made the country effectively bankrupt even before the collapse of its currency. As the crisis spread, most of Southeast Asia and Japan saw slumping currencies, devalued stock markets and other asset prices, and a precipitous rise in private debt.

Though there has been general agreement on the existence of a crisis and its consequences, what is less clear were the causes of the crisis, as well as its scope and resolution. Indonesia, South Korea and Thailand were the countries most affected by the crisis. Hong Kong, Malaysia, Laos and the Philippines were also hurt by the slump. The People's Republic of China, India, Taiwan, Singapore, Brunei and Vietnam were less affected, although all suffered from a loss of demand and confidence throughout the region.

======================================

Hamburger Crisis or USA Crisis

The United States, the world's largest economy, entered 2008 during a housing market correction, a subprime mortgage crisis and a declining dollar value. In February, 63,000 jobs were lost, a 5-year record.

In the early months of 2008, many observers believed that a U.S. recession had begun. As a direct result of the collapse of Bear Stearns, Global Insight. In addition, financial market turbulence signaled that the crisis will not be mild and brief.

On September 5, 2008, the United States Department of Labor issued a report that its unemployment rate rose to 6.1%, the highest in five years. The news report cited the Department of Labor reports and interviewed Jared Bernstein, an economist

The unemployment rate jumped to 6.1 percent in Augus.

On July 11, the largest mortgage lender in the US collapsed. IndyMac Bank's assets were seized by federal regulators after the mortgage lender succumbed to the pressures of tighter credit, tumbling home prices and rising foreclosures. That day the financial markets plunged as investors tried to gauge whether the government would attempt to save mortgage lenders Fannie Mae and Freddie Mac. The two were placed into conservatorship on September 7, 2008.

During the weekend of September 13–14, Lehman Brothers declared bankruptcy after failing to find a buyer, Bank of America agreed to purchase Merrill Lynch, the insurance company AIG sought a bridge loan from the Federal Reserve, and a consortium of 10 banks created an emergency fund of at least $70 billion to deal with the effects of Lehman's closure,[20] similar to the consortium put forth by J.P. Morgan during the stock market panic of 1907 and the crash of 1929. Stocks on "Wall Street" tumbled on September 15.

On September 16, news emerged that the Federal Reserve may give AIG an $85 billion (£48 billion) rescue package, on September 17, 2008, this was confirmed. The terms of the rescue package were that the Federal Reserve would receive an 80% public stake in the firm.

Credit Wikipedia

=================================
Cause of crisis of Asian come from Thailand that bubble in Real Estate and lend from outside when Fix Exchange Rate that Hedge Fund seen the chance to make profits. In USA crisis cause from mortgage loan and I thing from weakness in Regulator. Ratings from Moodeys or S&P cannot trusted when LBH bankruptcy. I don't interest Why....... But interest What happened next???????

This is Financial Crisis Cycle

Real Estate Crash (Past)----- Bank Crash(Now)-----No New Loan or Cut Operating Loan from Banks if Gov don't know that Bank is major in business or slowly act , cannot avoid Nightmares.

What Next.......

Real Business(Industry, SME) no money for operated that Business crash
After unemployment and no new employed that Social Crash.
When people no money and don't trusted in Bank and Economics, They save everything. That real business more crash
How many years for out of crisis.......for Thailand 1-3 Years in Bottom and out of Crisis about 5-7 years

Relate:

Real Crisis Start with Lehman Brother Bankruptcy

2008-09-17T03:02:00.000-07:00

!!!When the professor and idol of world financial go to bankruptcy!!!!! this is largest bankruptcy and not enough for Credit Crisis
How about others...

I think more half of financial institutes of the world use Lehman Brothers for advisory , financial model, investment, financial formula.....I cannot believe past knowledge or not...

Background of Lehman Brothers
Lehman Brothers Holdings Inc. is a global financial-services firm. The firm does business in investment banking, equity and fixed-income sales, research and trading, investment management, private equity, and private banking. The firm's worldwide headquarters are in New York City, with regional headquarters in London and Tokyo, as well as offices located throughout the world.

On September 15, 2008, it filed for bankruptcy protection; the filing marks the largest bankruptcy in U.S. history.............

Lehman Brother Bankruptcy
On September 13, 2008, Timothy F. Geithner, the president of the Federal Reserve Bank of New York called a meeting on the future of Lehman, which included the possibility of an emergency liquidation of its assets. Lehman reported that it had been in talks with Bank of America and Barclays for the company's possible sale. The New York Times reported on September 14, 2008, that Barclays had ended its bid to purchase all or part of Lehman and a deal to rescue the bank from liquidation collapsed. Leaders of major Wall Street banks continued to meet late that day to prevent the bank's rapid failure. Bank of America's rumored involvement also appeared to end as federal regulators resisted its request for government involvement in Lehman's sale.

Also on September 14, 2008, The New York Times reported that Lehman will file for bankruptcy protection for its parent company, Lehman Brothers Holdings, while keeping its subsidiaries solvent during the bankruptcy proceedings.

A group of Wall Street firms agreed to provide capital and financial assistance for the bank's orderly liquidation and the Federal Reserve, in turn, agreed to a swap of lower-quality assets in exchange for loans and other assistance from the government. Lehman's bankruptcy would be the largest failure of an investment bank since Drexel Burnham Lambert collapsed amid fraud allegations 18 years earlier. The International Swaps and Derivatives Association (ISDA) offered an exceptional trading session on Sunday, September 14, 2008, to allow market participants to offset positions in various derivatives on the condition of a Lehman bankruptcy later that day. Although the bankruptcy filing missed the deadline, many dealers are honoring the trades they made in the special session.

September 15, 2008, shortly before 1 a.m., Lehman Brothers Holdings announced it would file for Chapter 11 bankruptcy protection citing bank debt of $613 billion, $155 billion in bond debt, and assets worth $639 billion. Its subsidiaries will continue to operate as normal. The Australian Securities Exchange (ASX) suspended Lehman's Australian subsidiary as a market participant however, after clearing-houses terminated their contracts with the firm.

Primary Effect exclude Stock Markets
In the United Kingdom, the investment bank went into administration with PricewaterhouseCoopers appointed as administrators. In Japan, the Japanese branch, Lehman Brothers Japan INC., and its holding company filed for civil reorganization on September 16, 2008 in Tokyo District Court.

On Tuesday, September 16, 2008, Barclays announced that they will acquire a "stripped clean" portion of Lehman Brothers for $1.75 billion. This portion includes the Lehman Brothers Times Square headquarters and the bulk of Lehman's trading and debt security operations, which now become part of Barclays Capital.

Credit background and Event Schedule of LBH: Wikipedia
image from Photobucket

Relate Topics

Housing and Economic Recovery Act of 2008 - H.R.3221

2008-07-30T16:35:00.000-07:00

Housing and Economic Recovery Act of 2008 - H.R.3221

The U.S. passed H.R. 3221. The bill, the American Housing Rescue and Foreclosure Prevention Act, represents the most comprehensive response yet to the American mortgage crisis, and will help families facing foreclosure keep their homes, help other families avoid foreclosures in the future, and help the recovery of communities harmed by empty homes caught in the foreclosure process.

Key Summary

Summary of the “Housing and Economic Recovery Act of 2008" A. Summary of the “Federal Housing Finance Regulatory Reform Act of 2008" This legislation strengthens and modernizes the regulation of the housing government-sponsored enterprises – Fannie Mae and Freddie Mac (the enterprises) and the Federal Home Loan Banks (FHLBs or Banks) – and expands the housing mission of these GSEs. In addition, it creates a new program at FHA that will help at least 400,000 families save their homes from foreclosure by providing for new FHA loans after lenders take deep discounts.

establish capital standard
establish prudential management standards, including internal controls, audits, risk management, and management of the portfolio;
enforce its orders through cease and desist authority, civil money penalties, and the authority to remove officers and directors;
restrict asset growth and capital distributions for undercapitalized institutions;
put a regulated entity into receivership; and
review and approve (subject to notice and comment) new product offerings.

“HOPE for Homeowners Act of 2008"
1. Long-term affordability.
2. No investor or lender bailout.
3. No windfall for borrowers.
4. Voluntary participation.
5. Restore confidence, liquidity, and transparency.

My Opinion
This Act so cool and help people buy very slowly to luanched.............

Download: Summary / Full Bill

SEMGroup chance into Bankruptcy

2008-07-22T12:25:00.000-07:00

Or Semgroup bankruptcy?

SemGroup, L.P., is a midstream service company providing the energy industry. SemGroup provides diversified services for end users and consumers of crude oil, natural gas, natural gas liquids, refined products and asphalt. Services include purchasing, selling, processing, transporting, terminaling and storing energy. SemGroup serves customers in the United States, Canada, Mexico, Wales, Switzerland and Vietnam.

SemGroup was forced to recognize a $2.4 billion loss on July 16 and $850 million in losses on July 17 when its over-the-counter hedging program was marked to market.

SemGroup L.P. Files for Chapter 11 in U.S. and Creditor Protection in Canada to Facilitate Financial Restructuring.

Relate News

SemGroup LP Files for Chapter 11 in US and Creditor Protection in ...MarketWatch

These entities are self-funding and profitable and will continue their business operations without supervision from the US Bankruptcy Court. SemGroup Energy ...

Huge oil trading loss sinks energy trader SemGroup...Reuters

SemGroup listed assets of $6.14 billion and liabilities of $7.53 billion in its bankruptcy filing. Liabilities included $3.1 billion of total debt, ...

Improve Your Credit Score

2008-07-19T16:00:00.000-07:00

How to improve your credit score

A credit score is a numerical expression based on a statistical analysis of a person's credit files, to represent the creditworthiness of that person, which is the perceived likelihood that the person will pay debts in a timely manner. A credit score is primarily based on credit report information, typically sourced from credit bureaus / credit reference agencies.

Lenders, such as banks and credit card companies, use credit scores to evaluate the potential risk posed by lending money to consumers and to mitigate losses due to bad debt. Lenders use credit scores to determine who qualifies for a loan, at what interest rate, and what credit limits. The use of credit or identity scoring prior to authorizing access or granting credit is an implementation of a trusted system.

Credit scoring is not limited to banks. Other organizations, such as mobile phone companies, insurance companies, employers, and government departments employ the same techniques. Credit scoring also has a lot of overlap with data mining, which uses many similar techniques.

How to improve your Credit Score

FTC suggest to improve credit score. Scoring models usually consider the following types of information in your credit report to help compute your credit score:

On times: Have you paid your bills on time? You can count on payment history to be a significant factor. If your credit report indicates that you have paid bills late, had an account referred to collections, or declared bankruptcy, it is likely to affect your score negatively.
Are you maxed out? Many scoring systems evaluate the amount of debt you have compared to your credit limits. If the amount you owe is close to your credit limit, it’s likely to have a negative effect on your score.
How long have you had credit? Generally, scoring systems consider the length of your credit track record. An insufficient credit history may affect your score negatively, but factors like timely payments and low balances can offset that.
Have you applied for new credit lately? Many scoring systems consider whether you have applied for credit recently by looking at “inquiries” on your credit report. If you have applied for too many new accounts recently, it could have a negative effect on your score. Every inquiry isn’t counted: for example, inquiries by creditors who are monitoring your account or looking at credit reports to make “prescreened” credit offers are not considered liabilities.
How many credit accounts do you have and what kinds of accounts are they? Although it is generally considered a plus to have established credit accounts, too many credit card accounts may have a negative effect on your score. In addition, many scoring systems consider the type of credit accounts you have. For example, under some scoring models, loans from finance companies may have a negative effect on your credit score.

Scoring models may be based on more than the information in your credit report. When you are applying for a mortgage loan, for example, the system may consider the amount of your down payment, your total debt, and your income, among other things.

Improving your score significantly is likely to take some time, but it can be done. To improve your credit score under most systems, focus on paying your bills in a timely way, paying down any outstanding balances, and staying away from new debt.

My Opinion

Credit scoring systems are complex when they calculate debtors(Ours). But When they investment outside bank. They under perform. Logic is follow hedge fund................

Credit
Content: Wikipedia and FTC
Image: Flickr

Sub Prime Crisis develop to Hamburger Crisis

2008-07-16T18:28:00.000-07:00

Sub Prime Crisis develop to Hamburger Crisis and......
real crisis

Sub prime crisis that everybody say a little volume of total economic value develop to Hamburger Crisis that is real crisis......

What happen today about USA economics. Why I call real crisis. The big signal is Bank failure and people have to wait for withdraw from Bank. Shown, no confident for bank system. Whenever no don’t believe for very important sector that Crash……..

Basic logic of bank business is
- borrow from people
- lend to debtor
* Bank have to reserve for loan portfolio only 10% +/-

Therefore, if people not confident in bank system and need to withdraw in same time ...Every Financial Institution cannot find enough cash in suddenly.

This events need Government or Central Bank to acts
Gov have to seriously support for recall confident (I don't see / They concern outside-Iran very very far for dangerous)

What next.....

- Bank need cash for depositor
- They have to recall debt from debtor (Short Term Loan)
- No New Loan
- They have to borrow for depositor that make to high interest (When everybody need cash, they don’t refer rate from Fed )

Be careful real sector
----SME / Corporate / no money for operating business

I ever pass the same events(1997 Tom Yum Kung Crisis of Thailand - This time only begin of crash and crisis of Thailand)

What happen in Tom You Kung in same time
1.People withdraw in same times Thai Financial Institutes cannot find cash. They had to borrowed from Central Bank(Bank of Thailand)
2.Interest rate grow up to 10% highest 20%
3.FI cannot find reserve money for business that have FI failure more 50.

What acts for resolved
If gov not react anything, no bank survive …….
Government announced 100% guarantee for cash deposit in FI
(Thai could out of crisis about 5 years but have FI only 10-20(From 100) in system and gov’debt until hold more $70,000 mil. today)

This is only start of real crisis….I will told about what next………..and Who survive and What chance……Tomorrow

Debt Cures or How to Get Out of Debt - They Don't want you to know about

2008-07-12T07:04:00.000-07:00

Debt Cures How to get out of debt.

If ask me "How to get out of debt". Only one answer from me is pay debt. But how to pay, this is important more.

I wrote about debt restructuring this is way out.

For some idea and knowledge about nature of bank collection(that is big topic in USA). USA has more problem about subprime and gas price crisis(White House don't serious interest on this problem they concern only war- sorry this my opion) USA has talk about book Debt Cures "They" Don't Want You to Know About by Kevin Trudeau

image from Amazon.com
Debt cures they don't want you to know about
By Kevin Trudeau

In Amazon told if we read this book You will learn about
- How the credit lending business is rigged against you!
- How the financial industry wants to keep you in debt!
- How the banks and credit card companies are making obscene profits off of you and how you can change that!
- How to reduce or possible totally eliminate your debt!
- How you could cut your payments in half!
- How to correct your credit with two magic words!
- How to improve your credit virtually overnight!
- How to get free money that you never have to pay back!
- Find out why the financial industry wants to keep you in debt.
- Turn bad debt into good credit.
- Create wealth through financial health.

I read the topics that interest about nature of Bank that you can find some tactic to negotiate for reduce or restructuring of debt. If you into debt problem, good to read it.

But of all you have to consider about you income and net cash flow (net cash flow is income minus daily expense --food electric clothes etc. exclude debt repayment).

If net cash flow is under zero have to
1.Find jobs or special jobs for more income
2.Reduce some expense
3.if 1-2 not work go to the court or government for resolve your problem.

If net cash flow is higher zero (include lower debt repayment). You have to study way to restructuring debt or read Debt Cures.

Now I got many news about Bank have to failures or bankruptcy. This is very good chance to reduce debt because some financial(asset manage company) have to take over or buy asset(include debt) from bank failures they can buy very low price ex..

If your housings have value 1.0 mils(decrease from crisis) and your debt 0.9 mil. they can buy only 70% of value or 0.7 mils or lower. Therefore if you ask for out of debt by pay 0.75 mils. They have profit 0.05 mils. - Policy 1. of Asset management is How to collect quickly cash back because they have cost of fund to buy asset from bank failures.
Other cases if your debt 1.0 mils. but your collateral only 0.50 mils. You can think by yourself How many you can reduce your debt.

***Only for some ideas for me you have to study more about your law/conditions some states (easy way is call to Government)

What is Debt Consolidation

2008-05-17T22:32:00.000-07:00

What is Debt consolidation

Debt consolidation entails taking out one loan to pay off many others. This is often done to secure a lower interest rate, secure a fixed interest rate or for the convenience of servicing only one loan.

Debt consolidation can simply be from a number of unsecured loans into another unsecured loan, but more often it involves a secured loan against an asset that serves as collateral, most commonly a house. In this case, a mortgage is secured against the house. The collateralization of the loan allows a lower interest rate than without it, because by collateralizing, the asset owner agrees to allow the forced sale (foreclosure) of the asset to pay back the loan. The risk to the lender is reduced so the interest rate offered is lower.

Sometimes, debt consolidation companies can discount the amount of the loan. When the debtor is in danger of bankruptcy, the debt consolidator will buy the loan at a discount. A prudent debtor can shop around for consolidators who will pass along some of the savings. Consolidation can affect the ability of the debtor to discharge debts in bankruptcy, so the decision to consolidate must be weighed carefully.

Debt consolidation is often advisable in theory when someone is paying credit card debt. Credit cards can carry a much larger interest rate than even an unsecured loan from a bank. Debtors with property such as a home or car may get a lower rate through a secured loan using their property as collateral. Then the total interest and the total cash flow paid towards the debt is lower allowing the debt to be paid off sooner, incurring less interest.

Because of the theoretical advantage that debt consolidation offers a consumer that has high interest debt balances, companies can take advantage of that benefit of refinancing to charge very high fees in the debt consolidation loan. Sometimes these fees are near the state maximum for mortgage fees. In addition, some unscrupulous companies will knowingly wait until a client has backed themselves into a corner and must refinance in order to consolidate and pay off bills that they are behind on the payments. If the client does not refinance they may lose their house, so they are willing to pay any allowable fee to complete the debt consolidation. In some cases the situation is that the client does not have enough time to shop for another lender with lower fees and may not even be fully aware of them. This practice is known as predatory lending. Certainly many, if not most, debt consolidation transactions do not involve predatory lending.

Credit: Wikipedia
Other Information:

What is Debt Relief

2008-04-15T23:21:00.000-07:00

When country was in economic crisis we will heard debt restructuring and debt relief. My opinion debt relief is some way of debt restructuring.

Debt relief is the partial or total forgiveness of debt, or the slowing or stopping of debt growth, owed by individuals, corporations, or nations. It concerns in particular the Third World debt, which started exploding with the Latin American debt crisis (Mexico 1982, etc.).

Debt relief for heavily indebted and underdeveloped developing countries was the subject in the 1990s of a campaign by a broad coalition of development NGOs, Christian organisations and others, under the banner of Jubilee 2000. This campaign, involving, for example, demonstrations at the 1998 G8 meeting in Birmingham, was successful in pushing debt relief onto the agenda of Western governments and international organisations such as the International Monetary Fund and World Bank. Ultimately the Heavily Indebted Poor Countries (HIPC) initiative was launched to provide systematic debt relief for the poorest countries, whilst trying to ensure the money would be spent on poverty reduction.

The HIPC programme has been subject to conditionalities similar to those often attached to IMF and World Bank loans, requiring structural adjustment reforms, sometimes including the privatisation of public utilities, including water and electricity. To qualify for irrevocable debt relief, countries must also maintain macroeconomic stability and implement a Poverty Reduction Strategy satisfactorily for at least one year. Under the goal of reducing inflation, some countries have been pressured to reduce spending in the health and education sectors.

Arguments against debt relief

Opponents of debt relief argue that it is a blank cheque to governments, and fear savings will not reach the poor in countries plagued by corruption. Others argue that countries will go out and contract further debts, under the belief that these debts will also be forgiven in some future date. They use the money to enhance the wealth and spending ability of the rich, many of whom will spend or invest this money in the rich countries, thus not even creating a trickle-down effect. They argue that the money would be far better spent in specific aid projects which actually help the poor. They further argue that it would be unfair to third-world countries that managed their credit successfully, or don't go into debt in the first place, that is, it actively encourages third world governments to overspend in order to receive debt relief in the future. Others argue against the conditionalities attached to debt relief. These conditions of structural adjustment have a history, especially in Latin America, of widening the gap between the rich and the poor, as well as increasing economic dependence on the global North.

Personal debt relief

USA

Personal debt has become an increasingly large problem in recent years. For instance, it is estimated that the average US household has $19,000 in non-mortgage debt. With such large debt loads, many individuals have difficulty making repayments on debts and are in need of help.

There are many companies who offer debt consolidation services. However, such services may not always be in the best interests of the person involved and may involve taking out a loan secured on a person's home. Marketing materials are designed to persuade customers to take up the company's offer rather than offering a personal best solution for reducing debt. Where debt has become a problem, it is often best to turn to an independent consumer's association for advice before calling debt consolidation companies as they often have great experience with such problems and may be able to advise the most effective avenues for debt relief.

UK

The level of personal debt in the UK has also risen astonishingly in recent years:

"Total UK personal debt at the end of February 2008 stood at £1,421bn. The growth rate increased to 8.9% for the previous 12 months which equates to an increase of £111bn.

Free UK Debt Advice Organisations

Debt Restructuring Ways & Methods

2008-04-15T22:46:00.000-07:00

Debt Restructuring has many methods to resolved your debts. Way out of to resolved debts base on your revenue, cash flow and assets(I will talk on debt restructuring model). This is some methods that useful and most popular.

1.Debt payment period
Every debtors can ask creditors to reschedule installment include amount, term, interest rate. Example: - convert short-term loan to long-term loan
- extension period.
- reduced interest rate
- Reduced installment amount
That everything base on your revenue and suitable with personal loan and company

2.Reduction of principle and accrued interest
This way suitable for power debtor or crisis time(subprime ok). When crisis some company cash flow or personal revenue can not support to repay principle and interest (if government concern about over bankruptcy loss employment this way can happen)

3.Transfer of collateral asset and non-collateral asset to debt repayment
This way popular when debtor need to reduce dept for match to cash flow.

4.Sale of collateral asset and non-collateral asset to debt repayment
This way popular when debtor need to reduce dept for match to cash flow. When you sale some non collateral asset, you can ask some reduce principle or accrue interest. Because creditor get big lot money if calculate NPV will good position better wait 3-5 years.

5.Conversion debt to Equity
This way suitable listed company. This way good for reduce debt for raised new fund but lost of power in equity.

This major way to debt restructuring that better go to court and force sale asset.

Mortgage Calculator Guide

2008-02-28T23:25:00.000-08:00

This is guide to mortgage calculator and help to how much you can borrow or afford. This is site that provide free calculate for you.(www.mortgage-calc.com)

Mortgage Calculator

Amortization Calculator

Consolidation Calculator

Mortgage Refinancing Calculator

Miscellaneous Calculator

How to be millionaire?

What is Subprime Crisis Episode 3

2008-02-12T22:02:00.000-08:00

The causes and risks of the subprime crisis

The reasons for this crisis are varied and complex. Understanding and managing the ripple effect through the world-wide economy poses a critical challenge for governments, businesses, and investors. Due to innovations in securitization, the risks related to the inability of homeowners to meet mortgage payments have been distributed broadly, with a series of consequential impacts. The crisis can be attributed to a number of factors, such as the inability of homeowners to make their mortgage payments; poor judgment by either the borrower or the lender; inappropriate mortgage incentives, and rising adjustable mortgage rates. Further, declining home prices have made re-financing more difficult. There are three primary risk categories involved:

Credit risk: Traditionally, the risk of default (called credit risk) would be assumed by the bank originating the loan. However, due to innovations in securitization, credit risk is now shared more broadly with investors, because the rights to these mortgage payments have been repackaged into a variety of complex investment vehicles, generally categorized as mortgage-backed securities (MBS) or collateralized debt obligations (CDO). A CDO, essentially, is a repacking of existing debt, and in recent years MBS collateral has made up a large proportion of issuance. In exchange for purchasing the MBS, third-party investors receive a claim on the mortgage assets, which become collateral in the event of default. Further, the MBS investor has the right to cash flows related to the mortgage payments. To manage their risk, mortgage originators (e.g., banks or mortgage lenders) may also create separate legal entities, called special-purpose entities (SPE), to both assume the risk of default and issue the MBS. The banks effectively sell the mortgage assets (i.e., banking accounts receivable, which are the rights to receive the mortgage payments) to these SPE. In turn, the SPE then sells the MBS to the investors. The mortgage assets in the SPE become the collateral.

Asset price risk: CDO valuation is complex and related "fair value" accounting for such "Level 3" assets is subject to wide interpretation. This valuation fundamentally derives from the collectibility of subprime mortgage payments, which is difficult to predict due to lack of precedent and rising delinquency rates. Banks and institutional investors have recognized substantial losses as they revalue their CDO assets downward. Most CDOs require that a number of tests be satisfied on a periodic basis, such as tests of interest cash flows, collateral ratings, or market values. For deals with market value tests, if the valuation falls below certain levels, the CDO may be required by its terms to sell collateral in a short period of time, often at a steep loss, much like a stock brokerage account margin call. If the risk is not legally contained within an SPE or otherwise, the entity owning the mortgage collateral may be forced to sell other types of assets, as well, to satisfy the terms of the deal. In addition, credit rating agencies have downgraded over U.S. $50 billion in highly-rated CDO and more such downgrades are possible. Since certain types of institutional investors are allowed to only carry higher-quality (e.g., "AAA") assets, there is an increased risk of forced asset sales, which could cause further devaluation.

Liquidity risk: A related risk involves the commercial paper market, a key source of funds (i.e., liquidity) for many companies. Companies and SPE called structured investment vehicles (SIV) often obtain short-term loans by issuing commercial paper, pledging mortgage assets or CDO as collateral. Investors provide cash in exchange for the commercial paper, receiving money-market interest rates. However, because of concerns regarding the value of the mortgage asset collateral linked to subprime and Alt-A loans, the ability of many companies to issue such paper has been significantly affected. The amount of commercial paper issued as of October 18, 2007 dropped by 25%, to $888 billion, from the August 8 level. In addition, the interest rate charged by investors to provide loans for commercial paper has increased substantially above historical levels.

Episode1, Episode2, Episode3, Episode4

Credit: Wikipedia

What is Subprime Crisis Episode 2

2008-01-24T20:12:00.000-08:00

Subprime lending is a general term that refers to the practice of making loans to borrowers who do not qualify for market interest rates because of problems with their credit history or the inability to prove that they have enough income to support the monthly payment on the loan for which they are applying. Subprime loans or mortgages are risky for both creditors and debtors because of the combination of high interest rates, bad credit history, and murky personal financial situations often associated with subprime applicants. A subprime loan is one that is offered at an interest rate higher than A-paper loans due to the increased risk. Subprime, therefore, is not the same as "Alt-A", because Alt-A loans qualify for the "A-rating" by Moody's or other rating firms, albeit for an "alternative" means.

The value of U.S. subprime mortgages was estimated at $1.3 trillion as of March 2007, with over 7.5 million first-lien subprime mortgages outstanding. Approximately 16% of subprime loans with adjustable rate mortgages (ARM) were 90-days delinquent or in foreclosure proceedings as of October 2007, roughly triple the rate of 2005. By January of 2008, the delinquency rate had risen to 21%.

Subprime ARMs only represent 6.8% of the loans outstanding in the US, yet they represent 43.0% of the foreclosures started during the third quarter of 2007. A total of nearly 447,000 U.S. housing units were subject to some sort of foreclosure action from July to September 2007, including those with prime, alt-A and subprime loans. This is nearly double the 223,000 properties in the year-ago period and 34% higher than the 333,000 in the prior quarter.

The estimated value of subprime adjustable-rate mortages (ARM) resetting at higher interest rates is U.S. $400 billion for 2007 and $500 billion for 2008. Reset activity is expected to increase to a monthly peak in March 2008 of nearly $100 billion, before declining. An average of 450,000 subprime ARM are scheduled to undergo their first rate increase each quarter in 2008.

To be continue......
Episode1, Episode2, Episode3, Episode4

What is Subprime Crisis Episode 1

2008-01-21T19:15:00.000-08:00

The subprime mortgage financial crisis of 2007 was a sharp rise in home foreclosures which started in the United States during the fall of 2006 and became a global financial crisis within a year.

The crisis began with the bursting of the housing bubble in the U.S. and high default rates on "subprime", adjustable rate, "Alt-A", and other mortgage loans made to higher-risk borrowers with lower income or lesser credit history than "prime" borrowers. The share of subprime mortgages to total originations increased from 9% in 1996, to 20% in 2006. Further, loan incentives including "interest only" repayment terms and low initial teaser rates (which later reset to higher, floating rates) encouraged borrowers to assume mortgages believing they would be able to refinance at more favorable terms later. While U.S. housing prices continued to increase during the 1996-2006 period, refinancing was available. However, once housing prices started to drop moderately in 2006-2007 in many parts of the U.S., refinancing became more difficult. Defaults and foreclosure activity increased dramatically. By October 2007, 16% of subprime loans with adjustable rate mortgages (ARM) were 90-days delinquent or in foreclosure proceedings, roughly triple the rate of 2005. By January of 2008, this number increased to 21%.[5] As of December 22, 2007, a leading business periodical estimated subprime defaults would reach a level between U.S. $200-300 billion.

The mortgage lenders that retained credit risk (the risk of payment default) were the first to be affected, as borrowers became unable or unwilling to make payments. Major banks and other financial institutions have reported losses of approximately U.S. $100 billion as of January 16, 2008, as cited below. Due to a form of financial engineering called securitization, many mortgage lenders had passed the rights to the mortgage payments and related credit/default risk to third-party investors via mortgage-backed securities (MBS). Individual and institutional investors holding MBS faced significant losses, as the value of the underlying mortgage assets and payment streams declined and became difficult to predict.

In addition, certain legal entities designed to isolate this risk from the originating lenders, called collateralized debt obligations (CDO) and structured investment vehicles (SIV), held substantial amounts of MBS. As the value of payments into these entities declined, their value also declined, forcing the sale of MBS at fire sale prices in some instances.

The widespread dispersion of credit risk and the unclear impact on large banks, MBS, CDO, and SIV caused banks to reduce their loans to each other or make them at higher interest rates. Similarly, the ability of corporations to obtain funds through the issuance of commercial paper was impacted. The liquidity concerns drove central banks around the world to take action to provide funds to member banks to encourage the lending of funds to worthy borrowers and to re-invigorate the commercial paper markets.

The combination of impacts due to credit risk and liquidity risk caused several major corporations and hedge funds to shut down or file for bankruptcy. Stock market declines among both depository and non-depository financial corporations were dramatic. Many hedge funds and other institutional investors holding MBS also incurred significant losses.

With interest rates on a large number of subprime mortgages due to adjust upward during the 2008 period, U.S. legislators and the U.S. Treasury Department are taking action. A systematic program to limit or defer interest rate adjustments was implemented to limit the impact. In addition, lenders and borrowers facing defaults have been encouraged to cooperate to enable borrowers to stay in their homes. Restrictions on lending practices are under consideration. Many lenders have stopped subprime lending or dramatically curtailed it.

To be continue......
Episode2, Episode3, Episode4

Regulations for Debt Restructuring of Bank of Thailand (2/2)

2008-01-15T03:29:00.000-08:00

4.Debt Restructuring Procedures and Documentation

Financial institutions must draw up action plans and prepare the relevant documents in each stage of the debt restructuring.

4.1 Preliminary Analysis and Documentation

The following information and documents must be included to evaluate the restructuring of a loan agreement.

(1). Details of the cause of debtor’s credit difficulties and delayed payments of the principal and/or interest.
(2).The extent of the problem or cause of the debtor’s credit difficulties, the borrower’s financial risk, taking account of the borrower’s financial statements, cash flow statements, and financial forecasts, as well as an assessment of market conditions and other factors relevant to the debtor’s business and financial prospects.
(3). The expectations or likelihood of full repayment (principal and interest) under the original loan and under the restructured loan contracts.
(4). An evaluation of the borrower’s management focusing on their efficiency to ascertain if there is a need for an external expert’s help in organisational restructuring - for example, the changing of shareholders, directors, managing directors, or the managerial approach.
(5). The completeness and adequacy of the documents and loan criteria used in the restructuring process.
(6). If applicable, the collateral valuation following the Bank of Thailand’s regulations.

(7). The methodological approach and assumptions used to project future cash flows and calculate present values.

Note that with regards to the preliminary cash flow projections, financial institutions may not include uncertain cashflows in the present value estimations of future cashflows, for example, any cash flows resulting
from increases in the principal or the interest rate, or from exercising convertible debentures based on improvement in the debtor’s circumstances.

(8). The analyses, the conclusions, and the recommendations for the modification of terms such as reducing the interest rate, reducing the principal, reducing the accrued interest, and extending the repayment period.

Note that the terms and conditions in the modification of terms must take account of the economic life of the debtor’s business project(s). Modification of terms must be within the debtor’s repayment capacity such that the debtor is able to service the loan to its maturity.

(9). A revised amortisation schedule reflecting the modified terms which is within the debtor’s ability to repay.
(10). Details and any remarks regarding the terms and conditions of the loan including any financial covenants in the loan contract, for example, with regard to capital write-downs, recapitalisations, or where financial institutions specify the right to increase interest rates in the future in line with the debtor’s capacity to repay the loan (should circumstances improve).
(11). Legally enforcable contract and relevant documents must be prepared and signed.
(12). In cases where financial institutions grant additional loans to debtors with impaired loans, institutions must clearly state the purpose and use for which
the additional loan(s) is intended. There must be no implication that the additional loan is intended for servicing an existing loan.

4.2 Follow-up Procedures and Documentation

Financial institutions must have follow-up procedures to monitor restructured loans which are in accordance with the regulations set out. This is to ascertain whether debtors are able to repay their debts as agreed in their revised contracts.

(1). Progress reports must be prepared monthly by the designated officer detailing the latest developments in the firm, current action plans, and the likelihood of full repayment.
(2). Financial institutions must require debtors to provide them with financial statements, and to report the effects of the measures they undertake as
part of the restructuring process such as capital write-downs, recapitalisations, and the withholding of dividends.
(3).Financial institutions must set out guidelines for actions to be taken if debtors have further difficulties with repayment after restructuring.

5. Accounting for Debt Restructuring

5.1 The following accounting procedures are effective immediately for corporate loans with book values (including accrued interests) of 50 million baht and higher, and for corporate loans with book values of 20 million baht and higher, the accounting regulations are effective from the 1 January 2001 (B.E. 2544).

(1). Where concessions have been granted to the debtor, troubled debt restructuring requires that financial institutions calculate the new net book carrying value of the restructured loan (including any overdue or accrued interest) and hence the loss from restructuring using the first applicable method ranked by preference of priority as follows:

(a). The present value of expected future cash flows according to the restructured contract using the discount rate detailed in (3);
(b). The market value of the restructured loan, if there is a market for such debts and the market price is known, for example, the auction price obtained by the Financial Sector Restructuring Authority; or
(c). The market value of the collateral (appraised following Bank of Thailand collateral valuation and appraisal regulations) under the restructured contract if the loan is collateral dependent.

If the new net book carrying value of the restructured loan as calculated using one the above methods is less than the book value of the original loan, the financial institution must recognise the amount in its profit and loss statement in that accounting period, and determine the appropriate loan loss provisions following the BOT Notification Re: Worthless or irrecoverable assets and other doubtful assets which may be worthless or irrecoverable.

(2). In cases where the financial institution accepts a transfer of assets, equity instruments, debt instruments and/or the conversion of the borrower’s debt into equity (debt-equity swaps) in full settlement of the debt, financial institutions must deduct the market value of the assets and equity interests transferred from the book value of the loan, and write off the difference as a loss in the profit-loss statement as soon as the transfer is made. The reserve for doubtful debt shall also be taken into consideration.

In cases where the creditor accepts a transfer of assets, equity instruments, debt instruments and/or the conversion of the borrower’s debt into equity (debt-equity swaps) in partial settlement of the debt with a modification of terms for the remaining debt, financial institutions must undertake the procedure prescribed in (2) and account for the remainder of the debt following the regulations in (1).

(3). Financial institutions may use the market interest rate as the discount rate in present value cashflow calculations. Examples of market interest rates include the internal MLR, MOR, or MRR rates of the institution, or the LIBOR or SIBOR rates for foreign currency debt. Financial institutions should apply the market rate as at the date of debt restructuring appropriate to the structure of the debtor’s business and as such, institutions must set out and adhere to the policies and procedures on debt restructuring.

(4). After restructuring each case, financial institutions shall classify and make provisions against each debtor following the BOT Notification Re: Worthless or irrecoverable assets and other doubtful assets which may be worthless or irrecoverable whereby the period over which provisioning may be phased-in shall not exceed the remaining period up to the maturity of the restructuring contract.

(5). Financial institutions must recognise income on a cash basis in the testing period following the restructuring of a loan whereby the test period shall be the longer time period between 3 months or 3 consecutive repayment periods of the loan following the restructured loan contract.

(6). Financial institutions must review the restructured loans on a quarterly basis following the restructure. If there is a significant difference in the amount or timing of the loan’s realised cash flows, or in the floating interest rate, or in the value of the collateral from the projected values, financial institutions must recalculate the impairment loss (as detailed in (1) – (3)) and make the required provisions.

(Note that the book value of the restructured loan must never exceed the book value of the original loan, and the net carrying amount of the loan shall at no time exceed the recorded investment in the loan.)
To provide financial institutions with an adjustment period in line with the phase-in of the provisioning requirements up to the end of the year 2000 (B.E. 2543), financial institutions may use the collateral valuation method instead of the present value approach to calculate the loss from restructuring.

5.2 For loans with book values under the threshold detailed in paragraph 1 of section 5.1, financial institutions may apply the accounting procedures set out in section 5.1 or other accounting procedures, however, institutions must outline and incorporate these procedures in their debt restructuring policies.

5.3 For consumer loans which are to be restructured, financial institutions may estimate losses on restructuring on a group-by-group basis using a statistical method, or on a loan-by-loan basis in accordance with the debt restructuring regulations detailed in sections 5.1.

6. Authority of BOT Examiners

Examiners from the BOT are empowered to change existing debt classifications, make provisioning requirements, stop the use of accruals, and demand the reversal of accrued income in any of the following cases:

(1). Where debt restructuring was carried out with the objective of postponing debt classification and loan loss provisioning, or to avoid stopping accruals;
(2). Where there was inadequate documents and/or analyses of the debtor’s circumstances and ability to repay the loan;
(3). Where it is apparent that the debtor is or will be unable to abide by the terms of the new contract;
(4). Where the BOT regulations and guidelines have not been followed.

Previous 1/2
1 June B.E. 2542
Note: Unofficial Translation
From: Bank of Thakland

Regulations for Debt Restructuring of Bank of Thailand (1/2)

2008-01-15T03:23:00.000-08:00

Regulations for Debt Restructuring
1. Objectives
2. Types of Debt Restructuring
3. Establishing a Formal Strategy
4. Debt Restructuring Procedures and Documentation
5. Accounting for Debt Restructuring
6. Authority of BOT Examiners

Regulations for Debt Restructuring for Financial Institutions

1. The Objectives of Debt Restructuring

Debt restructuring should be carried out to maximise the creditor’s chances of getting repayment subject to the debtor’s ability to repay the loan, or in some other way improve on the conditions set out in the original contract to both parties. In particular, debt restructuring should be carried out to help debtors who have difficulties in loan repayment due to the effects of an economic crisis but are expected to recover in future. Financial institutions should ensure that restructuring is not carried out with the objective of postponing or avoiding debt classification or provisioning requirements, or the avoidance of stopping interest accruals.

2. Types of Debt Restructuring

With reference to these guidelines, the term debt restructuring refer to general debt restructuring cases as well as troubled debt restructuring defined here as follows:

2.1 General debt restructuring refers to debt restructuring whereby the financial institutions has incurred no losses from restructuring of debt – for example, where creditors have granted concessions by reducing the interest rate to reflect changes in market fundamentals or to maintain the relationship with the debtor, or by extending the repayment period or granting a grace period whereby the debtor continues to pay interest at the original contractual interest rate where creditors’ analyses have shown that the debtor is able to repay the full amount of the loan (principal and interest) as agreed in the original loan contract.

2.2 Troubled debt restructuring refers to debt restructuring cases where financial institutions incur losses from the restructuring due to one or a combination of the following -:

(1) A reduction of the principal or accrued interest; or
(2) Loss from restructuring through acceptance of a transfer of assets in debt repayment where fair value of assets is lower than credit written off; or
(3) Concessions in the terms of loan repayment resulting in a fall in the present value of cashflows such that this value is lower than the sum of book value of the credits outstanding and the accrued interest there on; or
(4) Loss from the debt restructuring calculations based on the market value of the debtor’s business, the fair value of the collateral asset, or loss from other techniques in debt restructuring such as from debt-to equity conversions.

3.Establishing a Formal Strategy for Debt Restructuring

3.1 Financial institutions must establish a formal strategy for debt restructuring whereby the highest level of management should participate directly in formulating this strategy. The strategy must form part of the institution’s written business policy.

3.2 The strategy should cover every stage of the restructuring process from start to finish including clear time-bound objectives, the approach and methodology for evaluating and granting loans, measures for monitoring and reporting on performance against those objectives to ensure that the restructuring has been carried out correctly in terms of its objectives and its accounting principles.

3.3 From the onset, financial institutions must clearly set out written procedures regarding the role and responsibility of officials in restructuring approval, reporting, and monitoring of the restructuring case, including the formation of an action plan for every stage of the restructuring process.

3.4 The financial institution must set up a division or a group of officials experienced in debt restructuring independent of the loan officer(s) in charge of the debtor to direct and implement the restructuring process following the procedures as outlined in 3.3. Alternatively, the financial institution may contract out another financial institution or an independent party such as a specialised group of experienced debt restructuring officers to undertake this duty. As a concession to financial institutions with limited personnel, where the institution has insufficient officials to undertake the task, loan officers may undertake the responsibility of following up on debt restructuring cases on condition that the officers strictly follow the regulations set out in 3.3

3.5 Conflicts of interest refer to conflict between related individuals or corporate, its directors, or management as outlined under the Commercial Banking Act B.E. 2505 and the Law on the Finance Business Securities Business and Credit Foncier Business B.E. 2522, including cases where directly or indirectly the related individuals or corporate holds shares in the debtor’s business, or where the debtor is a subsidiary of the institution, or is an enterprise in which the institution has managerial authority or monopolistic control over. If there is a conflict of interest, a third party must be appointed to evaluate the debtor’s circumstances and ability to repay the loan in accordance with the new contract proposed including the debtor’s projected future cash flows for present value estimations. As such, the third party must be a specialised entity undertaking finance business,a provider of financial advisory services, or amanagement consultancy with experience and skills recognised in the industry.

In cases where the financial institution is affiliated with or has interests in the debtor due to its involvement in assisting the debtor to solve its troubled debt difficulties, institutions are not required to use another financial institution or third party to evaluate the debtor’s financial status, the debtor’s repayment capacity, or his cash flows.

Continue....2/2

Note: Unofficial Translation
From: Bank of Thakland

Accounting debt

2008-01-15T03:14:00.000-08:00

In national accounting, debts are added according to those who are indebted. Household debt is the debt held by households. "National" or Public debt is the debt held by the various governmental institutions (federal government, states, cities ...). Business debt is the debt held by businesses. Financial debt is the debt held by the financial sector (from one financial institution to another). Total debt is the sum of all those debts, excluding financial debt to prevent double accounting. These various types of debt can be computed in debt/GDP ratios. Those ratios help to assess the speed of variations in the indebtness and the size of the debt due. For example the USA have a high consumer debt and a low public debt, while in European countries the opposite tends to be true.

There are differences in the accounting of debt for private and public agents. If a private agent promises to pay something later, it has a debt, and this debt is enforceable by public agents. If a public body passes a law stating that it'll pay something later (a kind of promise), it keeps the right to change the law later (and not to pay). This is why, for instance, the money governments promised to pay for retirements does not show up in the public debt assessment, whereas the money private companies promised to pay for retirements do.

From: wikipedia

What is Debt Restructuring

2008-01-05T10:34:00.000-08:00

Debt restructuring is a plan for business, which is made to make possible to continue business operation without danger from debt. It is usually cheaper and safer than bankruptcy. The only cost associated with a business debt restructuring is the time to negotiate with bankers, creditors, tax authorities and suppliers.

In United States, during debt restructuring, debts on average receive a 45% discount[citation needed]. Chapter 11 bankruptcy costs at least $50,000 in lawyer and court fees, with costs over $100,000 common. By some measures, only 20% of firms survive Chapter 11 filing.

From: Wikipedia

What is Debt

2008-01-05T10:22:00.000-08:00

Debt is that which is owed; usually referencing assets owed, but the term can cover other obligations. In the case of assets, debt is a means of using future purchasing power in the present before a summation has been earned. Some companies and corporations use debt as a part of their overall corporate finance strategy.

A debt is created when a creditor agrees to lend a sum of assets to a debtor. In modern society, debt is usually granted with expected repayment; in many cases, plus interest. Historically, debt was responsible for the creation of indentured servants.

Types of debt

There are numerous types of debt, including basic loans, syndicated loans, bonds, and promissory notes. Debt, especially large sums of debt, can also be secured through a mortgage or other security interest over some of the debtor's property, in which case the creditor will have some rights over that property in the event that the debtor becomes unable to repay the debt and defaults on the loan.

A basic loan is the simplest form of debt. It consists of an agreement to lend a principal sum for a fixed period of time, to be repaid by a certain date. In commercial loans interest, calculated as a percentage of the principal sum per annum, will also have to be paid by that date.

In some loans, the amount actually loaned to the debtor is less than the principal sum to be repaid; the additional principal has the same economic effect as a higher interest rate ).

A syndicated loan is a loan that is granted to companies that wish to borrow more money than any single lender is prepared to risk in a single loan, usually many millions of dollars. In such a case, a syndicate of banks can each agree to put forward a portion of the principal sum.

A bond is a debt security issued by certain institutions such as companies and governments. A bond entitles the holder to repayment of the principal sum, plus interest. Bonds are issued to investors in a marketplace when an institution wishes to borrow money. Bonds have a fixed lifetime, usually a number of years; with long-term bonds, lasting over 30 years, being less common. At the end of the bond's life the money should be repaid in full. Interest may be added to the end payment, or can be paid in regular installments (known as coupons) during the life of the bond. Bonds may be traded in the bond markets, and are widely used as relatively safe investments in comparison to equity.

From: Wikipedia

Debt Restructuring How To

2008-01-05T10:15:00.000-08:00

On dynamic economics and oil crisis of the world. Many corporation have problem about cash flow or pay debt. This blog will talk about how to debt restructuring and mortgage loan.

Debt Restructuring - Mortgage Loan How to

Dubai Debt Crisis about Imact World

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