by Calculated Risk on 2/19/2011 01:35:00 PM

There are three key housing reports to be released this week: Case-Shiller house prices on Tuesday, January Existing Home Sales on Wednesday, and January New Home sales on Thursday. Other key economic reports include the 2nd estimate of Q4 GDP to be released on Friday, and Durable Goods on Thursday.

----- Monday, Feb 21st -----
US markets will be closed in observance of Presidents' Day.

----- Tuesday, Feb 22nd -----
9:00 AM: S&P/Case-Shiller Home Price Index for December. Although this is the December report, it is really a 3 month average of October, November and December.

Click on and graph for larger image in graph gallery.

This graph shows the seasonally adjusted Composite 10 and Composite 20 indices through November (the Composite 20 was started in January 2000).

Prices are falling again, and the Composite 20 index will be close to a new post-bubble low in December. The consensus is for prices to decline about 0.5% in December; the sixth straight month of house price declines.

Morning: Moody's/REAL Commercial Property Price Index (CPPI) for December.

10:00 AM: Conference Board's consumer confidence index for February. The consensus is for an increase to 64.0 from 60.6 last month.

10:00 AM: Richmond Fed Survey of Manufacturing Activity for February. The consensus is for the index to close to the 18 reading last month (above zero is expansion).

1:00 PM: Minneapolis Fed President Narayana Kocherlakota speaks in Pierre, South Dakota.

----- Wednesday, Feb 23rd -----
7:00 AM: The Mortgage Bankers Association (MBA) will release the mortgage purchase applications index. This index increased slightly at the end of last year, and has declined slightly again over the last month to 1997 levels.

Early: The AIA's Architecture Billings Index for January (a leading indicator for commercial real estate).

This graph shows the Architecture Billings Index since 1996. The index showed expansion in December at 54.2; the highest level since December 2007.

This index usually leads investment in non-residential structures (hotels, malls, office) by 9 to 12 months.

10:00 AM: Existing Home Sales for January from the National Association of Realtors (NAR). The consensus is for sales of 5.2 million at a Seasonally Adjusted Annual Rate (SAAR) in January, slightly below the 5.28 million SAAR in December.

This graph shows existing home sales, on a Seasonally Adjusted Annual Rate (SAAR) basis since 1993.

Housing economist Tom Lawler is forecasting a decline to 5.17 millon (SAAR) in January. This would put the months-of-supply in the low 8 months range, probably up slightly from the 8.1 months reported in December.

Along with the release of January existing home sales, the NAR will release revisions for the past three years (2008 through 2010). In addition, the NAR is working on benchmarking existing home sales for previous years with other industry data (expectations are for large downward revisions). These revisions will be announced mid-year.

12:30 PM: Kansas City Fed President Thomas Hoenig speaks in Washington on the economic outlook

1:30 PM: Philadelphia Fed President Charles Plosser speaks in Alabama on the economic outlook

----- Thursday, Feb 24th -----
8:30 AM: The initial weekly unemployment claims report will be released. The consensus is for a slight decrease to 403 thousand compared to 410 thousand last week.

8:30 AM: Durable Goods Orders for January from the Census Bureau. The consensus is for a 3.0% increase in durable goods orders after decreasing 2.5% in December.

8:30 AM ET: Chicago Fed National Activity Index (January). This is a composite index of other data.

8:30 St. Louis Fed President James Bullard speaks in Bowling Green, Kentucky on "Monetary Policy Outlook for 2011"

10:00 AM: New Home Sales for January from the Census Bureau. The consensus is for an decrease in sales to 310 thousand (SAAR) in January from 329 thousand in December.

This graph shows New Home Sales since 1963. The dashed line is the current sales rate.

New home sales collapsed in May and have averaged only 294 thousand (SAAR) over the last eight months. Prior to the last eight months, the record low was 338 thousand in Sept 1981.

10:00 AM: 10:00 FHFA House Price Index for December. This is based on GSE repeat sales and is no longer as closely followed as Case-Shiller (or CoreLogic).

11:00 AM: Kansas City Fed regional Manufacturing Survey for February. The index was at 7 in January.

----- Friday, Feb 25th -----
8:30 AM: Q4 GDP (second estimate). This is the second estimate for Q4 from the BEA, and the consensus is for real GDP growth to be revised to an increase of 3.3% annualized from the advance estimate of 3.2%.

9:55 AM: Reuter's/University of Michigan's Consumer sentiment index (final for February). The consensus is for an increase to 75.4 from the preliminary reading of 75.3.

10:15 Richmond Fed President Jeffrey Lacker and Fed Board nominee Peter Diamond will comment on stress tests at US Monetary Policy Forum, New York, New York

1:30 PM: Vice Chairman Janet Yellen, Panel Discussion on Unconventional Monetary Policy at U.S. Monetary Policy Forum

Possible: FDIC Q4 Quarterly Banking Report

Best Wishes to All!

by Calculated Risk on 2/19/2011 09:32:00 AM

Note: this is an unofficial list of Problem Banks compiled only from public sources.

Here is the unofficial problem bank list for Feb 18, 2011.

Changes and comments from surferdude808:

Despite well wishes for a safe banking week, it was anything but with several failures and numerous additions to the Unofficial Problem Bank List. In all, there were six removals and 13 additions this week, which leaves the Unofficial Problem Bank List with 951 institutions with assets of $418.6 billion.

Assets increased by $5.6 billion, which is the largest weekly increase since November 5, 2010. Furthermore, the asset total of $418.6 billion is the highest it has been in nearly three months when they were $419.6 billion at November 19, 2010.

Among the removals are an action termination against Eaton National Bank & Trust Co., Eaton, OH ($190 million) and an unassisted merger as American State Bank, Tulsa, OK ($13 million) merged into Peoples Bank, Tulsa, OK.

All of the failures this week were on the Unofficial Problem Bank List and they include Habersham Bank, Clarkesville, GA ($396 million Ticker: HABC); San Luis Trust Bank, FSB, San Luis Obispo, CA ($306 million Ticker: SNLS); Citizens Bank of Effingham, Springfield, GA ($221 million); and Charter Oak Bank, Napa, CA ($136 million). Interestingly, Habersham Bank must have been on double secret probation with the FDIC as they never disclosed the Cease & Desist order Habersham Bank was under. In addition, the OTS issued a Prompt Corrective Acton order against San Luis Trust Bank, FSB only nine days before its failure.

As anticipated, the OCC released its actions through the middle of January 2011, which contributed to the numerous additions this week. Among the 13 additions are Wilmington Trust FSB, Baltimore, MD ($1.8 billion Ticker: WL); Southern Community Bank and Trust, Winston Salem, NC ($1.7 billion Ticker: SCMF); Queensborough National Bank & Trust Company, Louisville, GA ($941 million); Horry County State Bank, Loris, SC ($804 million Ticker: HCFB); and One Bank & Trust, National Association, Little Rock, AR ($439 million).

Other changes include Prompt Corrective Action orders issued by the Federal Reserve against the Bank of Whitman, Colfax, WA ($722 million) and Idaho Banking Company, Boise, ID ($195 million) and the OCC against Western Springs National Bank and Trust, western Springs, IL ($196 million).

Next week we anticipate the FDIC will release its actions through January 2011. Perhaps we should not issue any well wishes for a safe banking for the upcoming week given the carnage this past week.

CR Note: The FDIC will probably release the Q4 Quarterly Banking Profile in the next couple of weeks, and that will include the number of banks on the official problem bank list at the end of 2010.

by Calculated Risk on 2/18/2011 09:14:00 PM

From the FDIC: First California Bank, Westlake Village, California, Assumes All of the Deposits of San Luis Trust Bank, FSB, San Luis Obispo, California

As of December 31, 2010, San Luis Trust Bank, FSB had approximately $332.6 million in total assets and $272.2 million in total deposits ... The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $96.1 million. ... San Luis Trust Bank, FSB is the twenty-second FDIC-insured institution to fail in the nation this year

by Calculated Risk on 2/18/2011 08:16:00 PM

Fruited money tree
Harvested by reapers scythe
Charter Oaks corked
by Soylent Green is People
From the FDIC: Bank of Marin, Novato, California, Assumes All of the Deposits of Charter Oak Bank, Napa, California

As of December 31, 2010, Charter Oak Bank had approximately $120.8 million in total assets and $105.3 million in total deposits. ... The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $21.8 million. ... Charter Oak Bank is the twenty-first FDIC-insured institution to fail in the nation this year, and the second in California.

That makes three today.

by Calculated Risk on 2/18/2011 06:06:00 PM

Slaughtered Georgia ham
Springfield Citizen's failure
That's one Effed up bank.
by Soylent Green is People
From the FDIC: HeritageBank of the South, Albany, Georgia, Assumes All of the Deposits of Citizens Bank of Effingham, Springfield, Georgia

As of December 31, 2010, Citizens Bank of Effingham had approximately $214.3 million in total assets and $206.5 million in total deposits. ... The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $59.4 million. ... Citizens Bank of Effingham is the twentieth FDIC-insured institution to fail in the nation this year, and the sixth in Georgia.

Georgia on my mind.

by Calculated Risk on 2/18/2011 05:13:00 PM

Last bank in Clarkesville
Leaving from the station
Bair: Oh, no, no no
by Soylent Green is People (Apologies to The Monkees)
From the FDIC: SCBT National Association, Orangeburg, South Carolina, Assumes All of the Deposits of Habersham Bank, Clarkesville, Georgia

As of December 31, 2010, Habersham Bank had approximately $387.6 million in total assets and $339.9 million in total deposits. ... The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $90.3 million. ... Habersham Bank is the nineteenth FDIC-insured institution to fail in the nation this year, and the fifth in Georgia.

Georgia again ...

by Calculated Risk on 2/18/2011 02:54:00 PM

Diana Olick at CNBC mentioned a remodeling index from BuildFax this week:

A remodeling index from Texas-based BuildFax shows a national surge in remodeling work toward the end of the year, which appears to be continuing now.

It seem to me that requires a graph!

Click on graph for larger image in graph gallery.

The BuildFax Residential Remodeling Index is based on the number of properties pulling residential construction permits in a given month.

Sure enough - as Diana Olick noted - there has been a "surge in remodeling work" with November close to the levels of 2004 through 2006, and the strongest December since BuildFax started the index in 2004.

Note: permits are not adjusted by value, so this doesn't mean there is more money being spent, just more permit activity. Also some smaller remodeling projects are done without permits and the index will miss that activity.

Data Source: BuildFax, Courtesy of Index.BuildFax.com

by Calculated Risk on 2/18/2011 12:34:00 PM

A few notes and stories ...
• Portugal bond yields are soaring with the 10-year near 7.5%. There is growing speculation that Portugal will be the third European country (after Greece and Ireland), to require a bailout.

• The last European meeting failed to reach a consensus on a resolution mechanism. There is a meeting of several EU leaders, apparently including Angela Merkel and Nicolas Sarkozy, in Helsinki on March 4th, and then a special eurozone debt crisis summit on March 11th. (A Portugal bailout might be high on the agenda by then - especially since Portugal has large funding needs in April).

• The Irish election is on February 25th.

• From Reuters: ECB borrowing spike intensifies bank speculation

Emergency borrowing from the European Central Bank remained exceptionally elevated for a second straight day on Friday, intensifying speculation that one or more euro zone bank might be facing new funding problems.

• From the NY Times: Spain Gives Savings Banks Six More Months to List Equity

• Here are the Ten Year yields for Spain, Ireland and Greece (mostly moving sideways other than Portugal, although Ireland seems to be drifting up too).

by Calculated Risk on 2/18/2011 10:24:00 AM

The first graph shows the rolling 12 month average of loaded inbound and outbound traffic at the ports of Los Angeles and Long Beach in TEUs (TEUs: 20-foot equivalent units or 20-foot-long cargo container). Although containers tell us nothing about value, container traffic does give us an idea of the volume of goods being exported and imported - and possible hints about the trade report for January. LA area ports handle about 40% of the nation's container port traffic.

Click on graph for larger image in graph gallery.

To remove the strong seasonal component for inbound traffic, this graph shows the rolling 12 month average.

On a rolling 12 month basis, inbound traffic is up 18% and outbound up 11%.

The 2nd graph is the monthly data (with strong seasonal pattern).

For the month of January, loaded inbound traffic was up 13% compared to January 2010, and loaded outbound traffic was up 12% compared to January 2010 - but down compared to December 2010. This suggests the trade deficit with China (and other Asians countries) probably increased in January.

by Calculated Risk on 2/18/2011 08:44:00 AM

Fed Chairman Ben Bernanke argued this morning that the Fed is not to blame for inflation in other countries, and that those countries have tools to fight inflation ("including exchange rate adjustment, monetary and fiscal policies, and macroprudential measures"). He also argued the global imbalances are back, and countries "need to allow exchange rates to better reflect market fundamentals" and increase domestic demand (probably aimed at China).

From Fed Chairman Ben Bernanke: Global Imbalances: Links to Economic and Financial Stability. Excerpt:

In light of the relatively muted recoveries to date in the advanced economies, the central banks of those economies have generally continued accommodative monetary policies. Some observers, while acknowledging that an aborted recovery in the advanced economies would be highly detrimental to the emerging market economies, have nevertheless argued that these monetary policies are generating negative spillovers. In particular, concerns have centered on the strength of private capital flows to many emerging market economies, which, depending on their policy responses, could put upward pressure on their currencies, boost their inflation rates, or lead to asset price bubbles.

... policymakers in the emerging markets have a range of powerful--although admittedly imperfect--tools that they can use to manage their economies and prevent overheating, including exchange rate adjustment, monetary and fiscal policies, and macroprudential measures. ... it should be borne in mind that spillovers can go both ways. For example, resurgent demand in the emerging markets has contributed significantly to the sharp recent run-up in global commodity prices. More generally, the maintenance of undervalued currencies by some countries has contributed to a pattern of global spending that is unbalanced and unsustainable.
...
To achieve a more balanced international system over time, countries with excessive and unsustainable trade surpluses will need to allow their exchange rates to better reflect market fundamentals and increase their efforts to substitute domestic demand for exports. At the same time, countries with large, persistent trade deficits must find ways to increase national saving, including putting fiscal policies on a more sustainable trajectory