October 8 9News Interview

Here's the story that accompanied my Thursday morning interview on 9News:

Foreclosures still on the increase, but trend is slowing

KUSA - The Colorado Division of Housing has released local foreclosure statistics for September, and while the numbers continue to rise, the Division says they are improved over a year ago.
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The office said "completed foreclosures" rose by 21 percent in the state from last month, but the September numbers are down 5 percent from 2008.

According to the Office of the Comptroller of the Currency (OCC), which regulates all national banks, foreclosures are "completed" when the ownership of the properties is transferred to the servicers or investors and the debts are extinguished.

The OCC website says the process varies by state and can take up to 15 months to finish.

The numbers show Mesa County led the state in foreclosures with a rise of 217 percent over 2008, with Denver County reporting a decrease of 29 percent since this time last year. Arapahoe County totals fell 13 percent.

Housing spokesman Ryan McMaken was on 9NEWS 7 a.m.

McMaken explained completed foreclosures were lower because borrowers are becoming more sophisticated in exploring alternatives to foreclosure.

"This is helpful in keeping down the number of foreclosures that proceed to the end of the process," McMaken said. "Also, the reach of the foreclosure hotline continues to expand and this has helped keep totals down."

As to why completed foreclosures increased since August, McMaken says the division has noticed a slow but growing trend of lenders processing foreclosures more quickly.

Overall, McMaken says there's little in the report to suggest that foreclosures are about to take off again in Colorado, but the problem will persist for a while as the economy continues a gradual recovery.

"I'd expect to see a little bit of growth from September to October in totals," according to McMaken, "but I still expect 2009's numbers to be either flat or lower than the numbers from last year."

The full foreclosure report is available on the Division of Housing blog: www.divisionofhousing.blogspot.com

New report on Colo. Metro areas from Bureau of Economic Analysis

Here are selections form the release:

ECONOMIC SLOWDOWN WIDESPREAD IN 2008

New statistics released today by the U.S. Bureau of Economic Analysis show that the slowdown in U.S. economic growth was widespread: 60 percent of metropolitan areas saw economic growth slow down or reverse. Real GDP growth slowed in 220 of the nation's 366 metropolitan statistical areas (MSAs) in 2008 with downturns in construction, manufacturing, and finance and insurance restraining growth in many metropolitan areas. Growth in real U.S. GDP

In contrast, growth accelerated in 146 metropolitan areas, most notably in areas where natural resources and mining industries are concentrated such as Casper, WY and Grand Junction, CO. Grand Junction had the fastest real GDP growth (12.3 percent) of any metropolitan area in 2008 due largely to growth in natural resources and mining. The professional and business services industry group also showed strong growth in 2008, contributing the most to real GDP growth in 112 metropolitan areas.

The statistics of GDP by metropolitan area in current and real (chained) dollars are available from the Regional Economic Accounts page of the BEA Web site at http://www.bea.gov/regional/index.htm.

FDIC out of money

FDIC May Tap Treasury Line to Bolster Fund, Bair Says

Sept. 18 (Bloomberg) -- The Federal Deposit Insurance Corp. is considering tapping a Treasury Department line of credit as the agency examines ways to replenish a reserve fund depleted by 92 bank failures this year, Chairman Sheila Bair said.

Unemployment rates for states

Five states are now over 12%: Michigan, Nevada, Rhode Island, Oregon, and California. Of course, these are also the "official" numbers that exclude discouraged workers and the underemployed such as former financial sector workers who now work waiting tables.

See here for all states.

Double-Dip Recession Looms

Nothing fundamental has changed in the economy since a year ago when Lehman Brothers went under. Savings rates have increased, but Americans are so deeply in debt, they are still nowhere near the level of savings necessary for actual capital accumulation to take place. Unemployment is increasing, the government is engaged in massive inflation of the money supply, and there are simply no resources that can be pulled from a hat that will get Americans investing in production or spending on consumption. So, we are left with an economy that is essentially the same as it was when the financial panic hit and when the recession started way back during the fourth quarter of 2007.

The recent uptick is only a result of inflationary money flooding the economy through the stimulus plans.

Economist William White agrees.

Freedom Communications may declare bankruptcy

CNN Money today repeated reports that Freedom Communications may declare bankruptcy. Freedom most famously owns the Orange County register, but Freedom also owns The Colorado Springs Gazette, by far the most important daily in the Colorado Springs metro area.

Here's my commentary on the Mises Institute blog.

Viva Colorado column

Viva Colorado is a Spanish-Language rack-and-stack newspaper published by the Denver Newspaper Agency. It has the highest circulation of any Spanish-language paper in Colorado. This is a piece I wrote for the paper last month. I admit that I wrote the piece in English and the Viva Colorado editors translated it for me.

The piece covers a new change in law affecting the foreclosure process.