There is big news from Wall Street this morning. "The largest U.S. homebuilder said that its orders for the quarter ended June 30 fell 4.4% to 14,316 homes from 14,980 a year earlier. The value of the homes sold dropped to $3.8 billion from $4.1 billion."

"'The current home sales environment is characterized by an increase in both existing and new homes available for sale, higher than normal cancellation rates and an increase in the use of sales incentives in many of our markets,' said Chairman Donald R. Horton."

"'We think the sharp deterioration in earnings throughout the end of fiscal 2006 likely reflects sharply lower closings and significantly lower margins,' Bank of America analyst Daniel Oppenheim wrote."

"Raymond James released a report that said contracts for housing sales fell 42% year-over-year in June in the greater Washington area, according to an area realtors groups. Closings declined 38% and the inventory on the market now represents 7.1 months of supply, compared with 1.6 months in June 2005, and 5.9 months in May."

"'We continue to believe the Washington, D.C., market is headed lower as excessive speculation and overbuilding will weigh on the market for the foreseeable future,' Raymond James analyst Rick Murray wrote."

"Not even price cuts could save Horton from the forces of higher mortgage rates and a rising inventory of unsold homes. 'It's pretty brutal out there,' JMP Securities analyst Jim Wilson said. 'The strategy they're trying is to move product no matter what it takes. Their margins are getting clobbered.'"

"Some analysts following the industry were caught off guard by the magnitude of D.R. Horton's profit warning. 'To say our initial reaction was surprise' would 'heavily underestimate the impact; we were shocked,' wrote analyst Stephen East. 'Cancellations have taken a mighty toll on D.R. Horton's ability to deliver on its forecast, which has reduced its revenue and pressured margins as incentives have jumped substantially,' he said."

"'Even this housing bear is stunned,' said A.G. Edwards analyst Gregory Gieber in a note Friday. 'This is an industry epidemic, and we believe others could get hit worse.'"

And from Washington Mutual. "Washington Mutual Inc. said on Thursday it was planning to cut 900 jobs as part of a bid to match capacity with 'current and anticipated market conditions.' Spokeswoman Olivia Riley said 350 of the job cuts would be in its home loan group as it moves to outsource residential appraisals."

"Employees were informed on Wednesday about the job cuts, Riley said, the latest in a series of payroll reductions at the largest U.S. savings and loan. Like its rivals in the home lending business, Washington Mutual is dealing with a drop in activity as interest rates rise and the housing market cools."

The LA Daily News. "Washington Mutual's big Chatsworth campus took another hit Thursday, losing 140 more jobs as the bank continued its aggressive cost-cutting plan. Since January, the Seattle-based banking company has cut its Chatsworth work force by about 34 percent."

"The jobs are among 900, 350 of them real estate appraisers, that the company is eliminating across the country. Further job losses are possible, said company spokesman Tim McGarry."