Latest Beige Book still bland …

… but hints at Fed action to come.

From the link:

Economic growth continued at a sluggish pace over the past few weeks, the Federal Reserve said Wednesday, supporting views that the Fed might take action to spur the economy at its next policy meeting.

In its latest snapshot of regional economic conditions, the Fed reported some bright spots in manufacturing, travel, tourism and auto sales, but still saw weakness in the housing market.

The report, known as the Beige Book, summarized economic conditions in the central bank’s 12 districts across the nation. It will help set the tone for the Fed policy meeting set to take place Nov. 2-3. Investors are widely expecting an announcement of another round of asset purchases.

“The lack of meaningful improvements leaves investors anticipating additional action by the Federal Reserve to reinvigorate the economy in November,” said Kathy Lien, director of currency research for GFT, in a research note.

“If the Fed was worried about the recovery in September, they will remain worried in November as there was no major pickup in economic activity,” Lien said.

 

The housing market continues to suffer

And the White House is prepping to announce new initiatives to keep homeowners in their houses and forestall a new spate of foreclosures. The real-world effects of this recession are still ongoing, regardless what direction any economic indicators may point, and the help Main Street is getting from DC feels like a trickle here, a trickle there. So much for the “summer of recovery.”

From the link:

Housing and Urban Development Secretary Shaun Donovan revealed to CNN Friday that the Obama administration plans next week to unveil two new initiatives to deal with the crumbling housing market, and he left the door open to also reviving the expired $8,000 tax credit for first-time home buyers that had been propping up the industry.

“We’re going to be rolling out an FHA refinancing effort to help borrowers who are under water in their homes get above water,” Donovan said in an exclusive interview taped for CNN’s “State of the Union with Candy Crowley” on Sunday. “And second, we’re launching an emergency homeowners’ loan program for unemployed borrowers to be able to stay in their homes.”

The swift action being pushed by President Obama’s housing chief come in response to awful news in the housing industry this week, starting with Tuesday’s revelation that existing home sales hit their lowest level in over a decade, declining by over 27 percent during the month.

Update: this comes from today’s Playbook — brunch edition:

An administration official e-mails: “These are not new. He said ‘launching’ because they are previously introduced, but have not yet hit the market. The FHA short refi program was announced in March, and will launch in early September. The emergency homeowner emergency loan program, which was included in the Frank-Dodd bill (HUD put out in a release and conf. call two weeks ago), will be launched in October.”

More economic gloom …

… home sales at lowest point since 1995.

Line the nest, this recovery is gonna be slow

Real slow.

From the link:

A gauge of future economic activity rose 0.4% in May, signaling slow growth for the U.S. economy in the summer and fall.

The private Conference Board’s leading economic index is designed to forecast economic activity in the next three to six months.

Economists had expected a reading of 0.5% in May.

The Worker, Homeownership, and Business Assistance Act of 2009

This is a pretty nice rundown on the bill’s specs.

From the link:

The Worker, Homeownership, and Business Assistance Act of 2009 (H.R. 3548) was signed into law by President Obama on November 6, 2009. The bill began as a simple extension of unemployment insurance benefits but then several tax provisions were added to it, namely the expansion and extension of both the home buyer tax credit and the net operating loss (NOL) carryback rules.

More bad news looming for housing

Ouch.

From the link:

The percentage of U.S. homeowners who owe more than their house is worth will nearly double to 48 percent in 2011 from 26 percent at the end of March, portending another blow to the housing market, Deutsche Bank said on Wednesday.Home price declines will have their biggest impact on prime “conforming” loans that meet underwriting and size guidelines of Fannie Mae and Freddie Mac, the bank said in a report. Prime conforming loans make up two-thirds of mortgages, and are typically less risky because of stringent requirements.

“We project the next phase of the housing decline will have a far greater impact on prime borrowers,” Deutsche analysts Karen Weaver and Ying Shen said in the report.

The stimulus hits Main Street

To the tune of $75 billion for staving off foreclosusres.

From the link:

Seeking to stabilize the foundering housing market, President Obama is offering a plan to help as many as nine million families refinance their mortgages or avoid foreclosure, according to a summary released by the White House on Wednesday morning.

The plan, which is more ambitious than expected, would spend $75 billion to help keep as many as four million families in their homes, and would help as many as five million more refinance their mortgages to take advantage of lower interest rates.

“The plan not only helps responsible homeowners on the verge of defaulting, but prevents neighborhoods and communities from being pulled over the edge too,” the White House said in a fact sheet.