“Success is getting what you want and happiness is wanting what you get.”

When I was a young boy, my parents sent me to a child psychiatrist. The kid didn't help me at all.

Here is a link from the Wall Street Journal, thanks to Mr. Hobson. It tells you what subprime lenders are still alive, closed, etc...

http://online.wsj.com/public/resources/documents/info-subprimeloans0706-sort.html?s3&psfalse&aup

Although our Treasury yields are the lowest they’ve been since Spring, credit market turmoil has pushed LIBOR rates higher. Like our Fed Funds, LIBOR is an interest rate charged by banks for short-term loans to each other and is set daily by a bank trade association in London. The US dollar/LIBOR rate usually closely tracks the federal-funds rate, which is the overnight lending rate managed by the Federal Reserve. But the two rates are now diverging, complicating matters for the Fed as it tries to manage the global credit crisis and pushing up many short-term interest rates for borrowers. Yesterday, the rate hit 5.7%, marking the rate's fastest rise in several years. The LIBOR hasn't been this far above the base short-term rates set by central banks since the Enron and WorldCom collapses in 2001. Why? One reason the LIBOR is trading so high is that banks, many of them in Europe, have heavy commitments tied to struggling commercial-paper markets. They are reluctant to lend out dollars, and that is driving up short-term borrowing rates. Some are also worried that their counterparties in these trades, other banks, might be too weak to pay back the loans!

As it turns out, SCME did not close their Santa Rosa branch, but instead consolidated their Sacramento operation into their Concord CA operation.

EMC suspended their Secure Option ARM, Preferred Secure Option ARM & MTA Option ARM programs due to “current market conditions”, effective on locks taken on or after Tuesday until further notice.

Indymac, effective September 17th, will be making several guideline changes and are in response to guidance issued by The Federal Financial Regulatory Agencies. For all loan programs, all payment-based qualifications (debt-to-income ratios, reserve requirements, payment shock, etc.) for Interest Only Fixed Rate Loans will now use the fully amortized payment. For all loan programs, all payment-based qualifications for IO ARM loans will now use the fully amortized payment, based off the higher of either the note rate or the fully indexed (index + margin) rate, for example. Debt-To-Income Ratios for Stated Income Loans will also be impacted.

Yesterday the Fed’s Beige Book did not show any major surprises or significant "new news". It noted that "outside of real estate, reports that the turmoil in financial markets had affected economic activity during the survey period were limited", and had little good news on the housing front, stating that "The weakness in the housing market deepened across most Districts, with sales weak or declining and prices reported to be falling or flat. Districts reported a continuing contraction in the residential mortgage market."

Some good news for applications last week: they increased 1.3%. Purchase applications increased 0.4% and refinance applications increased 2.3%. Thirty-year fixed rates are lower than ARM’s indexed off of 1-year Treasury notes, providing a strong incentive for refinancing, although some may be waiting to see if the Fed takes action. On the economic news front today we had Jobless Claims -19k, but Productivity increased 2.6%, so they basically washed each other out and our 10-yr yield stands at 4.47% currently.