Some housing bubble news from Wall Street and Washington. "Facing criticism from members of Congress about lax regulation, ederal Reserve Chairman Ben Bernanke promised that the Fed would do everything possible to crack down on abuses that have put millions of homeowners in jeopardy of defaulting on their mortgages."

"'We at the Federal Reserve will do all that we can to prevent fraud and abusive lending and to ensure that lenders employ sound underwriting practices and make effective disclosures to consumers,' Bernanke said in remarks prepared for a financial conference."

From MarketWatch. "'Combating bad lending practices, including deliberate fraud or abuse, may require additional measures,' said Bernanke. 'Markets can overshoot, but, ultimately, market forces also work to rein in excesses,' the top central banker said. 'In the long run, markets are better than regulators at allocating credit.'"

"Banks and other lenders are tightening their standards for subprime, near-prime and even prime borrowers, a Fed survey of banks' loan officers showed earlier this week."

"'Curbs on this lending are expected to be a source of some restraint on home purchases and residential investment in coming quarters,' Bernanke said."

"About 14% of the outstanding first-lien loans, some 7.5 million, are subprime loans. Near-prime, also known as Alt-A or nontraditional loans, account for 8% to 10%."

From Bloomberg. "'We are likely to see further increases in delinquencies and foreclosures this year and next as many adjustable-rate loans face interest-rate resets,' Bernanke said."

"Bernanke said demand for high-yielding bonds in capital markets played a role in the fall in loan standards as subprime mortgage lending expanded. 'The practice of selling mortgages to investors may have contributed to the weakening of underwriting standards,' Bernanke said."

"Lawmakers and consumer advocates have blamed the Fed and other regulators for lax enforcement during the record $2.8 trillion mortgage boom between 2004 and 2006."

"At the urging of Congress, the Fed and other regulators issued a proposed guidance on prudent lending standards on subprime loans. Officials published the proposed guidance March 8. The Fed didn't publicly rebuke any bank for failing to follow up on guidance on lending practices in the period."

"Regulators could have 'done more sooner,' Roger Cole, the Fed's chief bank supervisor told legislators in March. 'Given what we know now, yes, we could have done more sooner,' Cole told the Senate Banking Committee."

From Forbes. "Each month, Daniel Oppenheim and Banc of America colleagues survey 4,000 real estate agents across the U.S. The topics. The numbers give Oppenheim a sense of pricing."

"'There's still a lot of uncertainty among us as to when the recovery will come,' says Oppenheim. Broadly, the data these days tell Oppenheim that home prices have further to drop. 'We still have excess inventory relative to demand,' he says."

"These days, Budd Bugatch, furnishings analyst at brokerage house Raymond James, doesn’t mince words when it comes to conditions for companies in his coverage area. 'Awful,' he says, 'It’s as bad as when it was when I was in the business in the mid-'70s.'"

From Business Week. "The news from the U.S. Census Bureau that housing starts actually increased in April was surprising, to say the least. But don't let April's report fool you, there is nothing encouraging in these new figures."

"As in the past, the percent increase still fell well within the census' margin of error of plus or minus 9.3%, so we can't say for certain whether they even rose at all. Comparisons to last year were not pretty either: starts were down 16% from a year ago."

"The biggest indication of a still struggling housing market came in the form of poor building permit numbers. In the month of April, permits fell 8.9%, the sharpest drop since February, 1990, to 1.429 million units, the lowest level in nearly 10 years. Compared to last year, permits were off 28.1%."

"'My overall take is that the downward adjustment in the housing sector is still ongoing,' says National Association of Home Builders chief economist Dave Seiders. 'I don't view this little bounce as a sign the fundamentals have improved.'"

"Back in January many economists were sure the housing market was evening out. In the second half of the year, real estate would rebound, or so went the common prediction. Now, it's obvious that a turnaround may not take place until the fourth quarter of the year."

"'The downtrends are still in place--probably not looking for a fundamental bottom until late in the year,' Seiders says. 'The signals coming out of '06 were that the demand side had stabilized, but everything was changed by the subprime mortgage market meltdown and subsequent tightening in lending standards. The uncertainties right now are tremendous.'"

The Associated Press. "A survey by the National Association of Home Builders released Tuesday indicated that there are more troubles to come as builder sentiment fell to an index reading of 30, matching the low point in the current downturn set in September."

"NAHB economist David Seiders said he changed his forecast to show a bigger 22 percent drop in construction starts this year, with 2008 showing a small 4 percent improvement, and the current slump ranking as the most severe since the 1990 housing downturn."

"'The housing sector got grossly overheated during the boom period, and there is a lot of payback going on now,' he said."

From Reuters. "OceanFirst Financial Corp. said it decided to close down its mortgage banking subsidiary as the unit incurred significant operating losses in the last two quarters from subprime mortgage loan originations."

The Orange County Register. "Option One Mortgage Corp. of Irvine is laying off 20 percent of its staff, or 600 workers, including 133 in Orange County. It also is closing 12 loan processing offices nationwide, the company said Wednesday."

"The lender, which funds loans brought by brokers, will stop buying loans in bulk, said Christine Sullivan, a spokeswoman for the lender."

The Daily Southtown. "ACC Capital Holdings Corp., parent company of sub-prime mortgage lender Ameriquest Mortgage Co., will cut hundreds of jobs in the Chicago area later this month as part of an earlier announced nationwide consolidation."

"The move is part of a final resolution arrived at last year with attorneys general in 30 states who investigated the company for possible predatory lending practices."

"ACC spokesman Chris Orlando stressed that not all the local layoffs are from Ameriquest, but also include ACC's other subsidiaries, Argent Mortgage Company, a wholesale mortgage loan operator, and AMC Mortgage Services, which handles loan servicing."