Some housing bubble news from Wall Street. "Technical Olympic USA, Inc...reported combined net sales orders of 2,117 for the second quarter of 2006, a 34% decrease from the 3,185 reported in the second quarter of 2005. During the quarter, the Company began implementing efforts to reduce its staffing levels to better align its cost structure with anticipated reduced levels of activities and softening market conditions."

"'Currently, conditions in most of our markets are different than those experienced during 2005; a year we believe represented unsustainable levels of activity. Current business conditions are characterized by increased inventories of new and existing homes, higher incentives, increased cancellation rates, lower traffic levels, increased competition among builders and a lack of buyer urgency,' said Antonio B. Mon, CEO."

"For the quarter ended June 30, 2006, Anworth Mortgage Asset Corp. announced today an unaudited net loss to common stockholders of $12.9 million. This net loss included the loss of approximately $10 million from the sale of approximately $400 million in agency mortgage-backed securities."

"Lloyd McAdams, Anworth's CEO, stated, 'The interest expense on our repurchase agreement financing has continued to increase almost in step with increases in the Federal Funds rate.'"

From Countrywide Financial. "The second quarter of 2006 was characterized by both rising interest rates and a relatively flat yield curve. The amount of total U.S. mortgage originations nationally declined 9% when compared to the second quarter of 2005."

"Our adjustable rate loan production has decreased in the quarter ended June 30, 2005 to 47% in the current quarter, reflecting the decreased relative attractiveness of these loans compared to fixed-rate loans as the yield curve flattens. The trend is also reflected in our pay-option loan production. Approximately 72% of the pay-option arms originated in the quarter ended June 30, 2006 were retained in our Bank's investment loan portfolio."

"Pay-option..borrowers may be less able to pay the increased amounts and, therefore, more likely to default on the loan, than a borrower using a more traditional monthly-amortizing loan. Substantially all of the pay-option loans we originate are underwritten based on 'reduced documentation' standards whereby the loan applicant's income is not fully documented."

From Broker Universe. "During the height of the stock market boom, now-retired Federal Reserve Board chairman Alan Greenspan said investors were acting with 'irrational exuberance.' The results of a recent survey of approximately 500 mortgage brokers might have some industry observers accusing participants of having irrational exuberance."

"The survey found that over 63% of the respondents said they were optimistic about their business prospects for 2006, while just 13% claimed to be pessimistic. But being that mortgage brokers are salespeople, it would be natural for them to have a positive outlook, especially as many of them have never faced a down market before."

"Almost 70% of the brokers said they believe their clients understand the mortgage product they are receiving, but a significant minority, 30%, said the consumer did not. When broken down by region, respondents from the West Coast have a more pessimistic response."

"In what might be the most telling sign of irrational exuberance in the mortgage broker business can be seen in the number of participants. In 1998, Wholesale Access estimated there were 36,000 mortgage brokerages. Based on the responses to the survey, Wholesale Access estimates there were still 53,000 mortgage brokers in the country for 2005."

"Soon there will be a decline in the number of brokers. A good, well-thought-out business plan may be the difference in being a successful mortgage brokerage and being a statistic."