FirstAlert: 11-11:30 A.M. Investrend / Bestcalls
Conference calls are often impacted by market trends, geopolitical conditions, news coming from conferences and economic releases.
Homeowner In Every Pot (By Philip Holmes) -- Stocks ended mixed on Wednesday as investors eyed a big new housing proposal from the Obama Administration and almost saw a glimmer of hope. Almost. So, what's in the Obama plan? According to the administration the plan will spend around $75 billion and help around nine million people who are at risk of foreclosure. Treasury will held shoulder some of the costs of writing down principal, so at-risk borrowers can refi at lower interest and principal. Think of it as a cram-down without so much crammed down the throats of the banks. Treasury will also up its funding commitment to the GSEs, adding around $900 billion to Fannie's and Freddies' portfolios, according to BusinessWeek. The move comes as U.S. housing starts set another dismal record in January, to a 466,000 unit annual pace, from 560,000 in December. Single family starts were down 12.2%, while multi-family starts were off a whopping 27.9%. Back to the Obama housing plan. According to the New York Times, "The plan has three basic components. One would help homeowners who continue to make loan payments on time, but are paying high interest rates and would otherwise not be able to refinance because they do not have enough equity or their houses are worth less than they borrowed." The Times continues, "A second would assist people who are at risk of foreclosure by providing incentives to lenders to alter the terms of loans to make them substantially more affordable to struggling homeowners. The third would try to assure there is plenty of credit available for mortgages by giving $200 billion of additional financial backing to Fannie Mae and Freddie Mac, the two government-controlled mortgage finance companies." It's the third part of this that troubles me. Will Fannie and Freddie be stepping ever more into dangerous territory by backing dodgy refinancings? Why not, with Treasury buying their MBS. The GSEs have already had their conforming limits set upward into bubble territory. They were pressured to step further into the realm of creative lending practices aimed at getting people to buy houses they couldn't really afford. Moral hazard in the making? We'll see.
The Investrend Earnings Calendar features CEC Entertainment (NYSE: CEC), expected at $0.16; CVX Caremark (NYSE: CVS), expected at $0.69; Expedia (NASDAQ: EXPE), expected at $0.24; Hornbeck Offshore Svcs (NYSE: HOS), expected at $1.05.
The Investrend Economics Calendar lists Retail Sales for January (8:30 a.m.), Weekly Initial Jobless Claims (8:30 a.m.), Business Inventories for December (10 a.m.), Treasury auctions 30-year bonds (1 p.m.).
The Investrend Events Calendar showcases ABH, SPP at Credit Suisse Global Paper Products Conference; AGU, LPX, ABH, MEOH at CIBC World Markets Annual Whistler Institutional Investor Conference; CLR, GDP, FXEN at The Oil & Services Conference; CR Annual Analyst Conference; ENS, ENER, WFR, STP at Piper Jaffray Clean Technology and Renewables Conference; ENTR, TER, MSCC, TUNE at Oppenheimer & Co Vail Semiconductor Summit; PG, AVP, PEP, CLX at Consumer Analyst Group of New York Conference; PLD at Oppenheimer & Co REITs/Real Estate Forum; VMC, EXP, RMIX at Longbow Research Construction Materials Investor Conference.
The Investrend Money Index is an indicator of the depth of market direction or indirection. While not always including the same stocks, the NYSE/NASDAQ 50 Most Actives indicate the direction in which the mass of money is flowing. Last session's trading showed 24 advancers versus 24 decliners and two unchanged. There were no significant advancers. Decliners followed Fifth Third Bancorp (NASDAQ: FITB) down 11.98%, Powershares Db Crude (NYSE: DXO) down 9.79%, Bk Of America Cp (NYSE: BAC) down 6.73%, Dryships Inc. (NASDAQ: DRYS) down 6.22%.
Vote in the Investrend Poll Question of the Day at Investrend Information (http://www.investrendinformation.com).
Investrend Website of the Day: http://www.confluence.org
Quote of the Day: "Ah, stardom! They put your name on a star in the sidewalk on Hollywood Boulevard and you walk down and find a pile of dog manure on it. That tells the whole story, baby." Lee Marvin
Today is: Chocolate Mint Day.
Happy Birthday: Nicolaus Copernicus, Merle Oberon, Lee Marvin, John Frankenheimer, Smokey Robinson, Lou Christie, Amy Tan, Jeff Daniels, Seal, Justine Bateman, Haylie Duff.
Today in History: In Alabama, former Vice President of the United States Aaron Burr was arrested in 1807 for treason and confined to Fort Stoddart. British explorer William Smith discovered the South Shetland Islands in 1819, claiming them in the name of King George III. In Austin, Texas, in 1846, the newly-formed Texas state government was officially installed. Serfdom was abolished in Russia in 1861. The phonograph was patented by Thomas Edison in 1878. Kansas, in 1881, became the first U.S. state to prohibit all alcoholic beverages.
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