Danielle DiMartino has this at the Dallas News. "The mortgage market remains a mystery to virtually every American. For starters, the sheer size is inconceivable; it's hard to get your mind around a fast-growing $8.7 trillion market. Even saying it's more than twice the size of the U.S. Treasury market doesn't put things into perspective for the layman."

"Try this bit of context, then: The mortgage market is so big that it has the ability to introduce systemic risk into our financial system. The last time systemic risk reared its head was in 1987, when a steep sell-off in stocks triggered a huge number of Wall Street firms' portfolio insurance."

"Reactionary, simultaneous, automated selling pressures succeeded in overwhelming a stock market that was supposed to be impenetrable. Similarly, every time there are large swings in the Treasury bond market, automatic sell or buy orders are triggered in the mortgage bond market."

"Sound too alarmist? Consider a few facts: The collateral backing mortgages is stretched precariously thin, one in 10 homeowners has zero-to-negative home equity. Recent estimates put one-quarter of all mortgages underwritten last year in the subprime, or riskiest, category. That's well above the 13 percent average share for the decade through 2005."

"Mortgage delinquencies ended last year at 4.55 percent, an 18-month high. And subprime delinquencies are pushing 12 percent. Despite historically low borrowing costs, households spent a record amount of after-tax income at year-end to pay required principal and interest payments. In the next two years, about a quarter of all outstanding mortgages, or more than $2 trillion worth, will reset at higher rates. A record 62 percent of commercial banks' earning assets are mortgage-related."

"For good measure, Goldman Sachs recently recognized the elephant in the room: 'These are the early days. An ongoing deterioration in credit quality in an environment of improving labor market performance and rising home prices is therefore quite significant.'"

Paul Muolo at National Mortgage News has this inside report. "Nonprime wholesaler MILA Inc. of Washington state has been quietly trimming its staff through attrition and layoffs. Since year-end, about 100 jobs have disappeared."

"More tidbits from the Rudman report: On Nov. 29, 2004, a few weeks before Fannie Mae's board found the courage to can then-chairman/CEO Franklin Raines and CFO Timothy Howard, 'presiding' Fannie director Ann Korologos sent a broadcast e-mail message to all GSE employees, asking them to come forward in regard to 'any unusual or atypical transactions' that had transpired over the past five years. In response to that e-mail, 10 employees and one seller/servicer came forward. One allegation became the 'subject' of a 'significant, standalone review.' What was the allegation? The report doesn't say."

"Genworth Financial of Canada soon will begin insuring 30- and 35-year mortgages in that country."

Garth Turner thinks that is significant. "The real estate boom is over. You may or may not like that news, but it is now official. I am calling the eight-year-long housing lovefest, finito. Done like dinner. Toast.'

"My friend Peter Vukanovich, who came to visit me in my riding office, pulled the trigger. His company, Genworth Financial, has now become the first mortgage insurer to cover 35-year home loans. And the country's best-known mortgage guru, whom I spent time with as well last week in the boardroom of a Toronto law firm, told me in hushed tones he is preparing for the advent of the 50-year mortgage."

"So, why does this show the real estate market has peaked and is about to hit the down escalator? Simply because this is the third major indicator that housing prices have passed the ability of the average family to afford them. And anytime that transpires, the writing is on the garage wall. amortizations which have gone from 25 years to 30, then to 35 years and quite possibly now to 50."

"This is irrefutable proof that houses at these levels are unaffordable if you play by the rules that have influenced real estate supply and demand for the last three generations. And layer on top of that the effect of five recent mortgage rate increases, with the prospect of a couple more to come, and you can see what's going down."

"Over the last year, Vancouver house prices rose 26 per cent. In Calgary, 24 per cent. In Toronto, just six per cent. I would argue that the inevitable correction in real estate prices has already started in the GTA and will soon be spreading west. The only way they'll make money on those houses is if they find somebody to pay even more. And behind that indebted buyer will be a generous lender. And behind that lender, a creative insurer. And you don't want to know what's behind him."