Some housing bubble news from Wall Street and Washington. MarketWatch, "Home-builder executives said at an industry conference Thursday that they're making progress clearing out excess inventory, but warned that a recession and spiking unemployment could stop that advance in its tracks. 'No one who's unemployed ever bought a house,' said Lawrence Angelilli, senior VP of finance at Centex Corp."

"'Mortgage foreclosures were never viewed as being competition for new construction,' said Angelilli. 'The thing that makes today so much different ... is that a lot of foreclosures are coming from nonowner-occupied borrowers who built new homes and were trying to flip them. Now you do have this first-time phenomenon of massive foreclosures that are coming through on new construction.'"

The Pioneer Press. "Earlier today, MoneyGram International announced that Phil Milne, chairman, president and CEO of the St. Louis Park-based money-transfer company, had stepped down, effective immediately. Once a Wall Street darling, MoneyGram fell hard and fast on investments in subprime mortgage related securities. The company first disclosed it would lose money on those investments in the fall of 2007, but the losses continued to mount. As of May, they stood at $1.6 billion."

"MoneyGram's stock - which has fallen 96 percent in the past year - was trading down about 9 percent at midday."

The Associated Press. "Financial services firm Fremont General Corp. said Wednesday night it filed for bankruptcy protection as part of its plan to sell its retail banking assets. Fremont General previously was one of the largest originators of subprime mortgages."

"In March, regulators gave Fremont General 60 days raise new capital or sell its banking subsidiary because the bank was considered 'undercapitalized.' It then agreed to sell the banking operations. Fremont General shares closed at about 7 cents Wednesday, leaving the company with a market capitalization of just over $5 million. A year ago the stock traded north of $12 per share."

"Mortgage insider Triad Guaranty Inc. said Thursday it will stop booking new business and go into run-off...a situation where an insurer no longer books new business, but instead generates revenue only on existing policies. Shares of Triad plunged 46 percent in morning trading."

"Insurers have been facing mounting losses since the middle of 2007 as mortgage defaults have skyrocketed, leading to a spike in claims. Triad Guaranty lost $77.5 million during 2007. It plans to stop booking new business July 15. About 100 jobs will be cut as it enters into run-off, the company said."

From Bloomberg. "HBOS Plc, the U.K.'s biggest mortgage lender, warned house prices will fall as much as 9 percent this year, more than it earlier forecast, forcing more borrowers to default on home loans."

"The Edinburgh-based company wrote down an additional 200 million pounds ($395 million), including stakes in homebuilders, and said risks related to bond insurers almost tripled to 1.5 billion pounds."

"The company said bad loans rose 17 percent to 4.95 billion pounds as of May 31 from 4.23 billion at the end of 2007. Late mortgage payments by 'specialist' customers including landlords and borrowers whose incomes weren't verified rose to 3.1 percent of total mortgages from 2.6 percent."

The International Herald Tribune. "More than 100 golf courses have been built in Spain in the past eight years, most accompanied by high-density residential developments targeting foreign buyers. A steep downturn in the Spanish housing market... is sending ripples through all sectors of the economy."

"During the first part of 2008, the number of home sales in Spain fell by 30 percent, according to government data, and estate agents report that house prices have dropped 10 percent to 20 percent in many tourist areas."

"By one construction industry estimate, there are more than 650,000 unused new housing units in Spain, including the houses built for the tourist market. In some areas, local officials are working with developers to use empty units in golf course developments as subsidized housing for Spaniards who cannot afford the high price of new homes."

"Industry experts say there is a glut of golf course villas and many of them are sitting empty, helping to drive down prices throughout the country. 'Investors are trying to exit their investments and they're not being able to,' said Mark Stucklin, who tracks the market."

From Reuters. "Models that predict payments on bonds issued and protected by Fannie Mae, Freddie Mac and Ginnie Mae have been far off the mark in recent months, resulting in increased risk to investors in the $4.5 trillion 'agency' MBS market."

"Errors are happening for the same reason credit loss forecasters failed to prepare investors for the subprime mortgage meltdown: it has never happened before."

"May data 'was a shock to everybody,' said Arthur Frank, head of MBS research at Deutsche Bank in New York. Vagaries of falling prices and tight credit have 'wreaked havoc' on models that were created during the heydey of refinancing, analysts at Merrill Lynch & Co. said in a recent research note."

"'An unprecedented housing market will produce unprecedented prepayments and defaults,' said Dale Westhoff, a managing director at JPMorgan Chase & Co. in New York, who has been refining models for 18 years. 'We've already seen that on the default side. On the prepayment side, the May numbers are starting to reflect this new environment.'"

"More than 400 people have been charged in a nationally coordinated probe of mortgage fraud that involved an estimated $1 billion in losses, the U.S. Justice Department said on Thursday."

"The department, disclosing a 3 1/2 month 'Operation Malicious Mortgage,' said...the U.S. Corporate Fraud Task Force was 'responding to issues raised by mortgage fraud in the corporate sector.'"

The New York Times. "What were the managers of Bear Stearns‘ hedge funds thinking as the mortgage markets began to go haywire and investors started asking for their money back? Thursday's indictments against those former managers, Ralph R. Cioffi and Matthew Tannin, offer some fascinating clues"

"In an April 22 e-mail from Mr. Tannin...Mr. Tannin wrote: ' the subprime market looks pretty damn ugly... If we believe the [CDOs report is] ANYWHERE CLOSE to accurate I think we should close the funds now. The reason for this is that if [the CDO report] is correct then the entire supbrime market is toast... If AAA bonds are systematically downgraded then there is simply now way for us to make money - ever.'"

The Arizona Republic. "Residents of Cooley Station North awoke Monday to 493 signs of more trouble for their half-empty subdivision. Process servers had blanketed the Trend Homes community in east Gilbert with foreclosure notices, targeting 493 vacant lots owned by a Scottsdale 'land bank,' which has fallen behind on its loan payments."

"'We're living in a subdivision that's half-full,' said Cooley Station homeowner Krista Anderson. 'My main concern is what's going to happen to the subdivision.'"

"Like many other land banks that had contracted with home builders during the real-estate boom, Taro was left with hundreds of vacant parcels. 'They ended up saddled with all these empty lots that nobody wanted,' said Mesa real-estate analyst Zach Bowers."

The Arizona Daily Star. "In his May report, John Strobeck of Bright Future Business Consultants, acknowledged that he didn't see the residential real-estate bubble developing back in 2005, in part because builders were requiring affidavits of occupancy that suggested the homes they sold would be lived in."

"'While it is clear that many people signed the affidavits of occupancy, they did it also at three or four other subdivisions where they bought houses,' he said. 'It was strictly a matter of dishonesty.'"

The Daily Herald. "Foreclosures in Illinois spiked again in May to about 42 percent compared to a year ago, according to RealtyTrac. 'We need to get rid of the inventory of homes on the market, which is about 18 to 22 months, now,' said Marve Stockert, executive director of Lombard-based Illinois Association of Mortgage Professionals. 'We should get that down to 12 to 14 months.'"

"He said some of the roadblocks remaining are adjustable-rate mortgages that can see interest rates soar, declining property values and tougher qualifications for those seeking to obtain mortgages."

"'Everyone needs to keep in mind that this is like a chicken-and-egg concept,' said Stockert. 'Property values are dropping and people here are finding it very difficult to re-finance. Some are buying a second home and say they'll lease their present home. But as soon as they close on the new one, they let the other go into foreclosure. This way, they already got the mortgage on the new home before their credit was wrecked.'"

The Herald Advocate. "Bill Diehl's job description is simple. 'It's to help people buy and sell homes,' said Diehl, one of two real-estate agents behind the Repo Home Tour Chicago."

"'Certainly nobody feels good about the fact that people have lost their homes,' Diehl said. 'But the reality is that for most people they haven't expressed great concern about it.'"

"Congress should examine preferential loans to two Senate Democrats, including the sponsor of a major housing bill, by mortgage lender Countrywide Financial Corp, a senior Democratic lawmaker said on Thursday."

"'My view is that these allegations should be considered by the appropriate bodies, and I understand that the Senate Ethics Committee has already begun to look into the matter,' Rep. Barney Frank said in a statement."

"Sen. Christopher Dodd of Connecticut and Sen. Kent Conrad of North Dakota have acknowledged that they refinanced properties as members of Countrywide's VIP program."

"Dodd is chairman of the powerful Senate Banking Committee, and is leading an effort this week to win Senate approval of a $300 billion housing rescue bill to help thousands of Americans facing foreclosure on their home loans."

"Dodd told reporters earlier this week he did not think he was getting any special deal when told in 2003 that he had been placed in a VIP program while refinancing two home mortgages with Countrywide."

The Hartford Courant. "A nonpartisan government watchdog group Wednesday listed U.S. Sen. Christopher Dodd as the Senate's No. 1 recipient of campaign contributions from Countrywide Financial Corp. in the last two decades."

"Though Dodd was the Senate's leading recipient of campaign contributions from Countrywide's political-action committee, the overall career amount of $25,000 is very small when compared with the senator's leading contributors. For instance, his career contributions from Citigroup Inc. total $439,094."

"The political research center also said Dodd had received $15,000 from Countrywide for his presidential campaign."

"Dodd's spokesman, Bryan DeAngelis, said Wednesday: 'As the senator said at his press conference yesterday, if the ethics committee requests any information, he will be more than happy to share it.' But when DeAngelis was asked whether Dodd would be making any of his mortgage paperwork public, he said he had no further comment."

From Politico.com. "Apparently, the housing crunch is nonpartisan. Washington insiders such as Ted Koppel, Ethel Kennedy and Ken Mehlman have priced to sell in a market that's taken a noticeable downward swing."

"'Prices have come down in general,' said Diana Hart, VP of the local affiliate of Sotheby's International Realty. 'Sellers are realistic, regardless of whether they're members of Congress or media celebrities.'"

"'Nightline' anchor Koppel has dropped the price of his home in Potomac, Md., from $4.1 million to $1.95 million. The sticker price of Koppel's 9,000-square-foot manse, which went on the market in 2005, was first slashed in August 2007, to $2.3 million."

"Koppel's price cut pales in comparison to that of Kennedy, widow of assassinated Sen. Robert F. Kennedy. Her home in McLean, Va., listed for $25 million in 2003, was reduced to $20 million and then to $16.5 million. The 10,524-square-foot estate is now listed by Washington Fine Properties for $12.5 million."

"But Dewita Soeharjono, a broker in Virginia, says not to feel too bad for homeowning politicos forced to reduce their asking prices. 'Actually, these guys bought the property way back then,' said Soeharjono. '[So] they actually made multiple times on their investment.'"

"The average sales price of a home in the Washington metro area jumped only 1.5 percent in 2007, from $463,000 in 2006 to $470,000. In 2005, the average sales price increased by 21.8 percent from the previous year."

"'Right now, foreclosures and decline in housing prices affects everyone,' Soeharjono said."