by Calculated Risk on 4/01/2010 08:37:00 AM

The DOL reports on weekly unemployment insurance claims:

In the week ending March 27, the advance figure for seasonally adjusted initial claims was 439,000, a decrease of 6,000 from the previous week's revised figure of 445,000. The 4-week moving average was 447,250, a decrease of 6,750 from the previous week's revised average of 454,000.

The advance number for seasonally adjusted insured unemployment during the week ending March 20 was 4,662,000, a decrease of 6,000 from the preceding week's revised level of 4,668,000.

Click on graph for larger image in new window.

This graph shows the 4-week moving average of weekly claims since 1971.

The four-week average of weekly unemployment claims decreased this week by 6,750 to 447,250.

The dashed line on the graph is the current 4-week average. The current level of 439,000 (and 4-week average of 447,250) is still high, and suggests continuing weakness in the jobs market. Note: There is no way to compare directly between weekly claims, and net payrolls jobs.

by Calculated Risk on 3/31/2010 10:40:00 PM

First: the buyer should find out if it is a HAFA short sale (starts April 5th). If so, the "negotiator fee" must be disclosed and be part of the agent's fee (total agent fee not to exceed 6%). From HAFA:

The amount of the real estate commission that may be paid, not to exceed 6% of the contract sales price, and notification if any portion of the commission must be paid to a contractor of the servicer that has been retained to assist the listing broker with the transaction.

As an aside, if the homeowner or buyer is an agent, they are not eligible for any commission.

Any commission that would otherwise be paid to you or the buyer must be reduced from the commission due on sale.

Second: as part of a HAFA short sale, the lender(s) must agree not to pursue a deficiency. If the lender balks on a short sale - I'd ask them about HAFA.

Third: Where are the regulators? Jim the Realtor is talking about rampant fraud in San Diego. Hello? Is anybody listening?

"There is rampant fraud and deceit being imposed by Realtors throughout the county. It's embarrassing."

by Calculated Risk on 3/31/2010 06:55:00 PM

From David Baker at the San Francisco Chronicle: State gas usage falls for 4th straight year

Driven lower by high prices and the recession, gasoline sales in California fell for the fourth year in a row during 2009, state officials reported Tuesday.
...
Annual gas sales in California peaked at 15.9 billion gallons in 2005 and have tumbled 7 percent since then.

Click on graph for larger image in new window.

This graph shows the percent change of taxable gallons of gasoline compared to the same quarter of the prior year.

In addition to gasoline usage being down for four straight years, driven by higher prices and then the recession, usage turned down again in Q4 2009 - probably because prices are up over $3 per gallon again.

by Calculated Risk on 3/31/2010 02:54:00 PM

Here is the monthly Fannie Mae hockey stick graph for January ...

Click on graph for larger image in new window.

Fannie Mae reported today that the rate of serious delinquencies - at least 90 days behind - for conventional loans in its single-family guarantee business increased to 5.52% in January, up from 5.38% in December - and up from 2.77% in January 2009.

"Includes seriously delinquent conventional single-family loans as a percent of the total number of conventional single-family loans."

by Calculated Risk on 3/31/2010 01:06:00 PM

I'd like to highlight a few key points from Atlanta Fed President Dennis Lockhart's speech today: Prospects for Sustained Recovery and Employment Gains

The normal state of affairs in the country's labor market is a dynamic mix of separations from employment and new job creation. There are two causes of separations—layoffs and voluntarily quitting a job, or so-called quits. The BLS began collecting data on these factors in 2000.

In 2008 and 2009, layoffs surged. Fortunately, the number of layoffs per month has recently returned to prerecession levels.

In addition, quits are at a decade-low level likely in part because of the uncertainty of job availability.

Today's slow pace of employment gains is due more to the slow pace of job creation, not the high rate of layoffs. Job gains, as conventionally understood, require two things: a vacancy and a worker able to fill that vacancy. For most of 2009, vacancies were relatively flat while unemployment continued to rise. This condition suggests the existence of what labor economists call "match inefficiencies."

There are two key types of match inefficiency. One is geographic mismatch. In 2008, the percentage of individuals living in a county or state different than the previous year was the lowest recorded in more than 50 years of data. People may be reluctant to relocate for a new job if the value of their house has declined. In addition, many who would like to move are under water in their mortgage or can't sell their homes.

The second inefficiency is skills mismatch. In simple terms, the skills people have don't match the jobs available. Coming out of this recession there may be a more or less permanent change in the composition of jobs. Skill mismatches require new training, and there is evidence that adult education institutions have responded to this need. For instance, officials at Miami-Dade College in Florida, which is the largest college in the country and a grantor of associate and vocational degrees, told us they have recently seen a strong increase in enrollment, especially of men in their 20s.

This evidence of retooling is encouraging, but, to be realistic, structural adjustment takes time.

Lockhart discusses two key mismatches, and the housing bubble was a direct cause of both. The first - lower geographical mobility because of the inability to sell a home - is like atherosclerosis for the economy. Usually people can move freely in the U.S. to pursue employment, but many people are tied to an anchor (an underwater mortgage) and solutions like a mortgage modification that requires them to stay in the home for 5 years doesn't help with worker mobility.

The second - skills mismatch - is partly because so many people went into the construction industry because it was the highest paying job. These workers may be highly skilled in their trade, but their skills are probably not transferable to the new jobs being created. I wouldn't be surprised to read of job shortages in some fields, while the unemployment rate remains very high because of the skills mismatch.

And more from Lockhart:

Looking forward, the consensus forecast for March is that the economy will add 200,000 new jobs. That number includes a boost from temporary government hiring for the census.

However, according to an Atlanta Fed estimate, we need to add about that number to payrolls each month for the next year to bring unemployment down a full percentage point. This estimate assumes that the growth in the labor force stays in line with the growth in the population.

This is another key point: Zero payroll jobs is not a magic number. It takes about 125+ thousand payroll jobs added per month to keep the unemployment rate steady over time, and probably close to 200 thousand jobs per month to reduce the unemployment rate by 1% over the next year.