Tax Pros Investors: August 2010

Sunday, August 22, 2010

The Future of Mortgages and the US Housing Market

The Future of Home Mortgages

Bill Gross, manager of the world's biggest bond fund at Pacific Investment Management Co., talks with Bloomberg's Carol Massar about the role of the government and private lenders in the nation's mortgage-finance system. Gross said earlier that the U.S. should consider "full nationalization" of housing finance as the Obama administration plots the revival of a market that was at the center of the 2008 credit crisis.

Watch the video.

http://www.bloomberg.com/video/62266534/

Build Your Legacy

Victor Lloyd Smith

Millennium Lyon Asset Management

Web: www.mlgcap.com

Legacy Capital: The Driving Force of the American Dream

Get your copy: Amazon.com, Barnes & Noble, Audio Series, e-Book

US States Reduce Borrowing Costs, Not Taxes

Short Sellers Are Cutting Borrowing Costs of States

Investors have to pay 284 basis points to insure their California bonds, 20 basis points more than for Portugal's. At 298 basis points, Illinois is in worse shape than Ireland. It costs more to insure the debt of New York (224 basis points) than Italy's.

Credit-default-swap spreads show that these U.S. states are "on the brink of financial catastrophe," according to Justin Marlowe, an assistant professor at the Daniel J. Evans School of Public Affairs at the University of Washington in Seattle.

The headline-worthy spreads haven't harmed these issuers in the bond market. They have reduced their cost of borrowing.