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February 24, 2010 / Hal (GT)

Underwater Mortgages and IMF Gold Sale news.


Here’s two items I figured worth passing on. This first one, boy, oh boy. It’s bad.

Underwater Mortgages Hit 11.3 Million

New data from First American CoreLogic shows why the solution to the problem banks face is so difficult to find. Eleven million, three hundreds thousand homes had underwater mortgages as of the fourth quarter of last year. That number represent 24% of all residential homes loans in America.The mortgage numbers are much worse when homes with equityof less than 5% are included. First American reports that ”an additional 2.3 million mortgages were approaching negative equity at the end of last year, meaning they had less than five percent equity.” That means that three out of ten homes have virtually no financial value to their owners.

And:

India again seen as likely buyer of more IMF gold

India’s central bank, which has increased its gold holdings to diversify its reserves, looks set to be a buyer again when the International Monetary Fund begins selling 191.3 tonnes of the precious metal amid volatility in major currencies.

The uncertain outlook for two of the world’s major reserve currencies — the dollar and euro — provides a spur for central banks, including India’s, to buy gold. India’s gold holdings lag those of major economies despite a big purchase in October.

So China may not be in the game. Or it’s all smoke and mirrors.

Right now gold is trading at $1,097.60 faced with some attempts to knock it back.

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