CNBC's Diana Olick on Possible Expanded Role for GSEs(CNBC) "Last week I interviewed an investor who buys foreclosed properties and rents them out long-term for solid returns. He claims that's the only way to right the housing market — get long-term investors to eat up the excess inventory. The biggest roadblock, however, is credit.
Fannie Mae and Freddie Mac both limit the number of investor mortgages. Multiple sources now tell me that the Administration, specifically over at the Department of Housing and Urban Development, is considering ways to get more investors into the housing market, possibly with the help of Fannie and Freddie. HUD would not confirm that, but Fannie Mae's chief economist Doug Duncan said it is definitely on the table both at HUD and at Fannie. "
CNBC's Jeff Cox on Declines in The U.S. Treasury's Market.(CNBC) "Despite the surprise success of Thursday's 30-year bond auction, analysts think the outlook for Treasurys is anything but bullish—prices will continue to decline, pushing interest rates higher. The reason, most bond pros believe, is that economic signs are getting better, inflation threats are accelerating and the government keeps issuing more debt."
Day Trading —Chinese Style (New York Times) "By some industry estimates, as many as 10,000 people in China are doing speculative day trading of American stocks — mostly aggressive young men working the wee hours here, from 9:30 p.m. to 4 a.m., each often trading tens of thousands of shares a day." (But it's more than just a guilt story—centered around the notion that young men in China are working into the "wee hours", while our young men do god only knows what: It may be illegal. In two — perhaps three—countries)"China prohibits its citizens from using Chinese currency to buy or sell shares of companies listed on foreign stock exchanges, though there appears to be no prohibition against trading stocks for an account owned by a foreign entity. That legal gray area has enticed several American and Canadian trading firms to set up shop here, at least partly to cater to wealthy clients seeking more diverse investment options. Securities experts are puzzled by the operations.
They question how the firms can profit by using inexperienced traders.
They also wonder aloud whether the use of traders in China violates American and Canadian securities laws. "
Wall Street's gains capped by yield uncertainty (Yahoo Finance via Reuters) "The S&P 500 and the Nasdaq edged up on Thursday, hovering around two- and three-year highs respectively, but a recent rise in bond yields and uncertainty over tax-cut legislation unsettled investors. A sharp selloff in U.S. government bonds earlier this week pushed the yield on the 10-year Treasury note above 3 percent. Although yields have stabilized, the rise unnerved investors. The rise in market rates could hinder the Federal Reserve's efforts to keep rates low and stimulate the economy by buying Treasuries."
Jobless Benefits Are Bad in Vermont—Besides, It's Cold There (CNN Money) "Jobless Americans everywhere are running out of federal unemployment benefits as Congress debates whether to extend the safety net as part of a Bush tax cut compromise. But even if lawmakers approve an extension, residents in seven states won't be eligible for the same number of weeks as their peers nationwide. That's because the unemployment rate in those states is improving so, according to federal law, the jobless there can't receive checks as long as those in harder-hit states."