Thomas Jefferson said, “A government big enough to give you everything you want, is strong enough to take everything you have.” Maybe he would be proud of the demonstration that my daughter and I saw on the banks of the Savannah River yesterday in Georgia, which apparently was taking place in many cities around the US: citizens protesting the use of their tax money to support private companies. These are interesting times.

This leads directly into the fees that the US Treasury will pay JPMorgan Chase & Co., Wells Fargo, Citi, GMAC, Morgan Stanley’s Saxon group, and CSFB’s Select Portfolio Servicing unit: $9.9 billion for modifying loans under President Barack Obama’s Making Home Affordable program. “The payments, which can be as much as $4,500 for each loan modified, would potentially help at least 2.2 million Americans avoid foreclosure”, according to Bloomberg calculations. The other servicers participating so far include units of Citigroup Inc., Credit Suisse Group AG, GMAC LLC and Morgan Stanley, according to data released by the Treasury Department today. Lenders will cut interest rates, extend repayment terms and forbear or forgive principal payments as necessary to reduce homeowners’ monthly payments to a more affordable level. The Treasury has set aside $75 billion in taxpayer funds to pay companies to modify loans. The program only applies to loans owned or guaranteed by federally controlled mortgage-finance companies Fannie Mae and Freddie Mac. Read it for yourself: http://www.bloomberg.com/apps/news?pid=20601103&sid=asw5rtbRJVcU&refer=us

Stonewater Mortgage “Given the industry wide complexities surrounding the current FHA market…has decided to temporarily discontinue offering Government loan programs. We will however, retain our FHA Full Eagle designation as well as our entire DE underwriting staff so that we may re-enter the government arena as it stabilizes.” They will focus on conventional production, with today being the last day to submit a complete unlocked government loan, and loans must be locked by tomorrow.

Here in South Carolina, cars are the center of a great deal of attention, and NASCAR is king. (Under a new plan by the Obama administration, if you buy a new car this year, you will able to deduct the sales tax from your income tax. Or you can just take a job at the White House and you wouldn't have to pay taxes at all.) What if mortgage banks were overseen by NASCAR? Often the same NASCAR teams were winning every week, so to keep things more exciting and to keep the others from leaving the circuit, they started rewarding the teams that placed fourth and fifth in races — after all, it isn’t much fun to watch only a couple of cars race. Therefore, NASCAR created a point system so that everyone wins!

Here’s a fresh story about fraud which unfortunately has impacted many companies: http://www3.signonsandiego.com/stories/2009/apr/15/1n15renters003434-renters-become-unwitting-victims/?zIndex=82602

Yesterday after I sent the commentary out we had Industrial Production fall 1.5% in March after a similar decrease in February, and Capacity Utilization for total industry fell further to 69.3 percent, a historical low for this series, which begins in 1967. The Fed's Beige book was also released, with no real surprises although contraction slowed in 5 of the 12 Fed districts. But the total economy nationally contracted or remained weak. The Fed announced their next round of purchases and through yesterday the Fed has purchased slightly over $51 billion. JPMorgan Chase announced their earnings this morning and their profit beat analysts’ estimates on record revenue. Jobless Claims declined 53,000 to a seasonally adjusted 610,000 in the week ended April 11 from a revised 663,000 the week before.  Housing Starts and Building Permits both fell in March (no surprise), and after this news the 5-yr is at 1.73%, 10-yr at 2.78%, and mortgage prices a shade worse.

General Growth Properties Inc., the nation's second-largest mall operator, filed for Chapter 11 bankruptcy protection today after it failed to persuade a majority of its debt holders to give it more time to refinance billions of dollars in debt racked up during the housing boom. They own all or part of over 200 malls across 44 states, and the move was somewhat expected and in fact last autumn the company warned investors that this might happen. Chapter 11 protection typically allows a company to hold off creditors and operate as normal while it develops a financial reorganization plan, so shoppers at its malls will not be affected by its decision to file for bankruptcy protection.

The Down Side of Working in a Cubicle:
* Being told to "Think Outside the Box" when I'm in the darn box all day!

* Not being able to check e-mail attachments without first seeing who is behind me.

* Fabric cubicle walls do not offer much protection from any kind of gun fire.

* That nagging feeling that if I just press the right button, I will get a piece of cheese.

* Lack of roof rafters for the noose.

* My walls are too close together for my hammock to work right.

* 23 power cords, 1 outlet.

* Prison cells are not only bigger, they have beds.

* When tours come through, I get lots of peanuts thrown at me.

* Can't slam the door when you quit and walk out.

* If you talk to yourself it causes all the surrounding cubicle inhabitants to pop their heads over the wall and say "What? I didn't hear you."

* If your boss calls you and asks you to come into his office for a minute the walk there is like a funeral march... people hand you tissues as you pass and refuse to make eye contact.

* You always have the feeling that someone is watching you, but by the time you turn to look they're gone.

Rob

(For archived commentaries, check www.robchrisman.com, or to subscribe write to rchrisman@robchrisman.com)