Marc's Mortgage Matter's

At least the stock market is going up, right? After being stagnant this week, it would appear that equities will be rallying this week. Haven’t you heard? In spite of more housing foreclosures ahead, and commercial lending being in trouble, the economy is doing great! Commodities are going up, with oil now over $71 per barrel and gold up $10 an ounce. Yesterday the Fed was in buying their usual $5-6 billion, but it didn’t seem to help mortgage rates which hit a 7-month high, ouch!

The Obama administration marked with little fanfare a major milestone in its bank rescue effort — its decision on Tuesday to let 10 big banks repay federal aid that had sustained them through the worst of the crisis — as policy makers and industry executives focused on the challenges still before them. 

“This is not a sign that our troubles are over,” President Obama said. “Far from it.”

While the announcement had been expected for weeks, the official word put the administration’s imprimatur on a corps of big banks considered healthy enough to extricate themselves from Washington’s grip.

The bank holding companies, among them American Express, Goldman Sachs, JPMorgan Chase and Morgan Stanley, plan to return a combined $68.3 billion. That represents more than a quarter of the federal bailout money that the nation’s banks have received since last October, when many feared that failures might cascade through the industry.

But the decision to allow the banks to exit the Troubled Asset Relief Program, or TARP, also ushered in a new, and potentially risky, phase of the banking crisis. Letting the lenders out now — earlier than many had envisioned, and without the industry reforms some consider necessary to prevent future crises — raises many sobering questions for policy makers, bankers and taxpayers.

The program was aimed at purchasing assets and equity from banks to strengthen them and encourage them to expand lending during a tightening credit squeeze. But after banks return the TARP money, the administration will forfeit much of its leverage over them. With that loss goes a rare opportunity to overhaul the industry. The administration’s ability to push institutions to purge themselves quickly of bad assets and do more to help hard-pressed homeowners will be diminished.

Of even deeper concern is the running trouble inside the banking industry. Despite tentative signs of revival, many banks remain fragile. Four of the nation’s five largest lenders, including Citigroup and Bank of America, were not allowed to return their bailout funds.

Some analysts worry that financial institutions that repay bailout money now may turn to Washington again if the economy worsens and losses overwhelm banks. One of the most vexing problems of the credit crisis — how to rid banks of their troubled mortgage investments — remains unresolved.

The banks are eager to escape TARP and the restrictions that come with it, particularly the limits on how much they can pay their 25 most highly compensated workers. (This part makes me puke!)

But homeowners and consumers are unlikely to benefit if banks repay their TARP funds en masse. Banks are giving back money that might otherwise be used to make loans.

The announcement on Tuesday underscored the stark dividing line across the banking industry. On one side are big banks now considered healthy enough to forgo their TARP money. On the other side are those considered too weak to go without it. Still, some of those weaker banks may be allowed to repay the money soon....

BBQ RULES

We are about to enter the BBQ season. Therefore it is important to refresh your memory on the etiquette of this sublime outdoor cooking activity, and when a man volunteers to do the BBQ the following chain of events are put into motion:
Routine...
The woman buys the food, makes the salad, prepares the vegetables, makes dessert, prepares the meat for cooking, places it on a tray along with the necessary cooking utensils and sauces, and takes it to the man who is lounging beside the grill - beer in hand.
The woman remains outside the compulsory three meter exclusion zone where the exuberance of testosterone and other manly bonding activities can take place without the interference of the woman.
Here comes the important part:
THE MAN PLACES THE MEAT ON THE GRILL.
The woman goes inside to organize the plates and cutlery, and comes out to tell the man that the meat is looking great. He thanks her and asks if she will bring another beer while he flips the meat.

THE MAN TAKES THE MEAT OFF THE GRILL AND HANDS IT TO THE WOMAN.
The woman prepares the plates, salad, bread, utensils, napkins, sauces, and brings them to the table. After eating, the woman clears the table and does the dishes.
And most important of all:
Everyone PRAISES the MAN and THANKS HIM for his cooking efforts, and the man asks the woman how she enjoyed “her night off” and, upon seeing her annoyed reaction, concludes that there's just no pleasing some women.