One Third of New Owners Owe More Than House Is Worth (Update1) By Bob Ivry Aug. 12 (Bloomberg) -- Almost one-third of U.S. homeowners who bought in the last five years now owe more on their mortgages than their properties are worth, according to Zillow.com, an Internet provider of home valuations. Second-quarter home prices fell 9.9 percent from a year earlier, giving 29 percent of owners negative equity, said Zillow, the Seattle-based service that offers values for more than 80 million homes. For those who bought at the 2006 peak of the housing market, 45 percent are now underwater, Zillow said. Negative equity and declining prices are making it difficult for homeowners to sell property for a profit. Almost one-quarter of U.S. homes sold in the past year were for a loss, Zillow said. That contributes to the foreclosure rate because some homeowners can't absorb the loss and end up surrendering their homes to the bank that holds the mortgage, said Stan Humphries, Zillow's vice president of data and analytics. ``For homeowners who need to sell, this is a gravely serious situation,'' Humphries said in an interview. ``It can also be harmful to communities where the number of unsold homes adds more to inventory and puts downward pressure on prices.'' The highest percentages of homeowners with negative equity were located in California. In four of the state's metropolitan areas -- Stockton, Modesto, Merced and Vallejo-Fairfield -- the number of homeowners whose mortgage debts exceeded the values of their properties topped 90 percent, Zillow said. In five more California areas -- the Inland Empire (Riverside-San Bernardino), Bakersfield, Yuba City, El Centro and Madera -- the percentages were more than 80 percent. Foreclosure Sales In Stockton and Modesto, more than half the sales in the second quarter were of foreclosed homes, Zillow said. Almost 15 percent of sales nationwide were foreclosures, the company said. Prices fell on a year-over-year basis in 140 out of 165 markets, Zillow said. Pittsburgh, Oklahoma City and Austin, Texas, were among the markets that saw rising home values, the company said. The 9.9 percent decline in home values was the largest on a year-over-year basis in at least 12 years, Zillow said. The median home price of $206,919 was the lowest since the fourth quarter of 2004, the company said. ``Sellers are starting to adjust their expectations,'' Zillow Chief Financial Officer Spencer Rascoff said in a Bloomberg TV interview. ``More sellers accepting a loss is actually a sign of optimism. It means that the transactions might start happening. There are so many sales contingent upon the buyer selling their home.'' The Zillow Home Value Index is the median valuation for a given geographic area on a given day and includes the value of all single-family residences, condominiums and cooperatives, regardless of whether they sold within a given period, the company said. The index at the national and metropolitan area levels is calculated using a weighted average of the median home value for each county, Zillow said. To contact the reporter on this story: Bob Ivry in New York at bivry@bloomberg.net.
The radio reported that Pres. Bush has postponed his vacation time at the ranch to "monitor foreign events" from the white house. They said it as part of a report on the Russian / Georgian situation but it certainly could relate to this too.
Three major US naval strike forces due this week in Persian Gulf DEBKAfile Special Report August 12, 2008, 10:04 PM (GMT+02:00)
New America armada around Iran DEBKAfile’s military sources note that the arrival of the three new American flotillas will raise to five the number of US strike forces in Middle East waters – an unprecedented build-up since the crisis erupted over Iran’s nuclear program. This vast naval and air strength consists of more than 40 carriers, warships and submarines, some of the last nuclear-armed, opposite the Islamic Republic, a concentration last seen just before the US-led invasion of Iraq in 2003. Our military sources postulate five objects of this show of American muscle: 1. The US, aided also by France, Britain and Canada, is finalizing preparations for a partial naval blockade to deny Iran imports of benzene and other refined oil products. This action would indicate that the Bush administration had thrown in the towel on stiff United Nations sanctions and decided to take matters in its own hands. 2. Iran, which imports 40 percent of its refined fuel products from Gulf neighbors, will retaliate for the embargo by shutting the Strait of Hormuz oil route chokepoint, in which case the US naval and air force stand ready to reopen the Strait and fight back any Iranian attempt to break through the blockade. 3. Washington is deploying forces as back-up for a possible Israeli military attack on Iran’s nuclear installations. 4. A potential rush of events in which a US-led blockade, Israeli attack and Iranian reprisals pile up in a very short time and precipitate a major military crisis. 5. While a massive deployment of this nature calls for long planning, its occurrence at this time cannot be divorced from the flare-up of the Caucasian war between Russia and Georgia. While Russia has strengthened its stake in Caspian oil resources by its overwhelming military intervention against Georgia, the Americans are investing might in defending the primary Persian Gulf oil sources of the West and the Far East. DEBKAfile’s military sources name the three US strike forces en route to the Gulf as the USS Theodore Roosevelt , the USS Ronald Reagan and the USS Iwo Jima . Already in place are the USS Abraham Lincoln in the Arabian Sea opposite Iranian shores and the USS Peleliu which is cruising in the Red Sea and Gulf of Aden.
Russia: 'Forget' Georgian territorial integrity August 14, 2008 - 12:43pm
A Georgian coast guard boat seen partially submerged after being targeted by Russian forces in the Black Sea port of Poti, Georgia, Thursday, Aug. 14, 2008. The Georgian Foreign Ministry has said Russian troops remain in control of Poti, a Black Sea port city with an oil terminal that is key to Georgia's fragile economic health. (AP Photo/Bela Szandelszky) By CHRISTOPHER TORCHIA Associated Press Writer GORI, Georgia (AP) - Russia's foreign minister declared Thursday that the world "can forget about" Georgia's territorial integrity, and officials said Russia targeted military infrastructure and equipment _ including radars and patrol boats at a Black Sea naval base and oil hub. Two American military planes delivered cargos of aid _ including food and medicine _ to Georgia's wounded and refugees. Defense Secretary Robert Gates said he sees no need to invoke U.S. military force in the war between Russia and Georgia. He warned, however, that U.S.-Russian relations could suffer for "years to come" if Moscow doesn't retreat. Russia's president met in the Kremlin with the leaders of Georgia's two separatist provinces _ a clear sign that Moscow could absorb the regions. And the comments from Russian Foreign Minister Sergey Lavrov appeared to come as a challenge to the United States, where President Bush has called for Russia to respect the sovereignty and territorial integrity of Georgia." "One can forget about any talk about Georgia's territorial integrity because, I believe, it is impossible to persuade South Ossetia and Abkhazia to agree with the logic that they can be forced back into the Georgian state," Lavrov told reporters. The White House said it would ignore the comment. "Our position on Georgia's territorial integrity is not going to change no matter what anybody says," White House press secretary Dana Perino said Thursday. "And so I would consider that to be bluster from the foreign minister of Russia. We will ignore it." In Washington, an American official said Russia appeared to be sabotaging airfields and other military infrastructure as its forces pulled back. The U.S. official described eyewitnesses accounts for The Associated Press on condition of anonymity. The official said the Russian strategy seems like a deliberate attempt to cripple the already battered Georgian military. "We are very concerned about these reports; it is a serious situation," said State Department spokesman Robert Wood. Georgia's coast guard said Russian troops had burned patrol boats and destroyed radars and other equipment at the port city of Poti, home to Georgia's main naval base and a major hub for oil exports to Europe. An AP Television News crew in the oil port city of Poti saw one destroyed Georgian military boat, and two Russian armored vehicles and two Russian transport trucks. Soldiers who identified themselves as Russian peacekeepers blocked the crew from going further. Russian General Staff Col.-Gen. Anatoly Nogovitsyn avoided comment on the Russian presence in Poti, saying only that Russian forces were operating within their "area of responsibility." In Vienna, Victor Dolidze, Georgia's ambassador to the Organization for Security and Cooperation in Europe, said Russians were also looting the Georgian military base in Senaki. On Poti's outskirts, the APTN crew followed a different convoy of Russian troops as they searched a forest for Georgian military equipment. Russian troops also appeared to be settling in elsewhere in Georgia, including in the key city of Gori, where a checkpoint confrontation ended in the confused flight of Georgian forces. In the morning, columns of Georgian police and military vehicles prepared to reoccupy Gori, but by afternoon, Russian tanks had blocked the entrance to the town, explosions were bursting on the other side of a hill and panicked Georgian troops were fleeing for safety in pickup trucks. In Washington, a Pentagon official said U.S. intelligence had assessed that the number of Russians in Gori was small _ about 100 to 200 troops. But the Russian presence in Gori, only 60 miles west of Tbilisi, was viewed as a demonstration of the vulnerability of the capital. Nogovitsyn said Russian troops went to Gori to establish contact with the local civilian administration and take control over military depots left behind by the Georgian forces. "The abandoned weapons needed protection," he said. A Russian general in Gori had said Wednesday it would take at least two days to leave the city. In France, Secretary of State Condoleezza Rice issued another urgent call on Russia to honor the cease-fire with Georgia as she was bringing the formal agreement to Tbilisi to have it signed Friday by the president of Georgia, a democratic former Soviet republic that is now strongly aligned with Washington. French President Nicholas Sarkozy said the documents are "intended to consolidate the cease-fire." The EU-sponsored accord had envisioned Russian and Georgian forces returning to their original positions. In Washington, Vice Chairman of the Joint Chiefs of Staff Gen. James Cartwright said Russian forces appeared to be forming up in Georgia in preparation for withdrawal. "It's difficult at the tactical level to know each and every engagement in each town," Cartwright said, "but, generally, the forces are starting to move." U.S. aid arrived in the Georgian capital of Tbilisi on Wednesday and Thursday, but Nogovitsyn said he was not sure that the U.S. planes carried exclusively humanitarian cargo. "It causes our concern," he said. Besides the hundreds killed since hostilities broke out, the United Nations estimates 100,000 Georgians have been uprooted; Russia says some 30,000 residents of South Ossetia fled into the neighboring Russian province of North Ossetia. Georgia, bordering the Black Sea between Turkey and Russia, was ruled by Moscow for most of the two centuries preceding the 1991 breakup of the Soviet Union. Russia has distributed passports to most in South Ossetia and Abkhazia and stationed troops they call peacekeepers there since the early 1990s. Georgia wants the Russian peacekeepers out, but Medvedev has insisted they stay. In his meeting with leaders of Abkhazia and South Ossetia, Medvedev reiterated Moscow's longtime position that the regions should be allowed to choose their own affiliations. More homes in deserted ethnic Georgian villages in the breakaway province of South Ossetia were apparently set ablaze Wednesday, sending clouds of smoke over the foothills north of the provincial capital, Tskhinvali. One Russian colonel, who refused to give his name, blamed the fires on looters. Those with ethnic Georgian backgrounds who have stayed behind _ like 70-year-old retired teacher Vinera Chebataryeva _ seem increasingly unwelcome in South Ossetia. As she stood sobbing in her wrecked apartment near the center of Tskhinvali, Chebataryeva said a skirmish between Ossetian soldiers and a Georgian tank had gouged the two gaping shell holes in her wall, bashing in her piano and destroying her furniture. Janna Kuzayeva, an ethnic Ossetian neighbor, claimed the Georgian tank fired the shell at Chebataryeva's apartment. "We know for sure her brother spied for Georgians," said Kuzayeva. "We let her stay here, and now she's blaming everything on us." North of Tskhinvali, a number of former Georgian communities have been abandoned in the last few days. "There isn't a single Georgian left in those villages," said Robert Kochi, a 45-year-old South Ossetian. But he had little sympathy for his former Georgian neighbors. "They wanted to physically uproot us all," he said. "What other definition is there for genocide?" ___ Associated Press writers Misha Dzhindzhikhavili in Tbilisi; Mansur Mirovalev in Tskhinvali, Georgia; Jim Heintz in Moscow; and Anne Gearan, Matthew Lee and Pauline Jelinek in Washington contributed to this report. http://wtop.com/?nid=105&sid=1372087Ukraine says it reserves right to bar Russian navy
4 days ago
KIEV, Ukraine (AP) — Ukraine warned Russia on Sunday it could bar Russian navy ships from returning to their base in the Crimea because of their deployment to Georgia's coast.
Ukraine's Foreign Ministry said the deployment of a Russian naval squadron to Georgia's Black sea coast has the potential of drawing Ukraine into the conflict.
"In order to prevent the circumstances in which Ukraine could be drawn into a military conflict ... Ukraine reserves the right to bar ships which may take part in these actions from returning to the Ukrainian territory until the conflict is solved," said the statement which was posted on the ministry's Web site.
Both Ukraine and Georgia have sought to free themselves of Russia's influence, integrate into the West and join NATO.
The statement reflected a strong Ukrainian support for Georgia and is certain to anger Moscow, further straining Russian-Ukrainian relations.
Russia's deputy chief of General Staff Col.-Gen. Anatoly Nogovitsyn said Sunday he was aware of the statement, but added that the Russian government must analyze it before making comment.
"It makes a third party involved, and it's quite unexpected," Nogovitsyn said said at a news conference.
A 1997 agreement between Russia and Ukraine lets the Black Sea Fleet remain in Sevastopol through 2017, but Ukrainian officials have said they want it out after that. The issue adds to emotions over Crimea, which was part of the Russian Federation but ceded to Ukraine during the Soviet era and became part of the independent Ukraine when the Soviet Union collapsed in 1991. http://ap.google.com/article/ALeqM5jiafUbbRzef5Bap4RvqbtLjfj_vgD92FC68O0
Is the Dollar Really Making a Comeback Tour Here?
Monday, August 11, 2008 - Vol. 10, No. 190
Today's comment is by Jack Crooks, editor of The Money Trader and World Currency Options.
The big news this past week was definitely the dollar. The dollar rallied the most against the euro than it has in the past eight years. The dollar index climbed the highest it has been in six months.
So the question is: What's going on here? How can the dollar rally like this when the greenback's fundamentals leave so much to be desired?
Let me give you my theory about what's happening here. To really understand it, you need to start with a question:
What happened to decoupling, the idea that other economies are immune to the United States' weakness?Well, it seems the sub-prime fiasco created bigger problems for the U.S. financial system than everyone thought. And now we're seeing this economic virus spread to other areas of the globe.
Need Evidence? It's All on the Nightly News
It's pretty easy to see other countries are feeling our same sub-prime pain. Just look at these recent news stories...
German industrial orders dropped sharply - by 2.9% in June. That's disconcerting considering Germany's economy makes up one-third of total Eurozone output. And speaking of the rest of the Eurozone, many of those economies are bogged down by housing busts just like us.
The International Monetary Fund (IMF) called out the U.K. economy. They predicted the U.K. would grow 1.8% and 1.7% for 2008 and 2009, respectively. All I have to say is: Kiss those numbers goodbye. The IMF's latest forecast calls for a seriously lower 1.4% in 2008 and 1.1% in 2009.
Australia is battling sluggish household spending and their financial sector is being challenged. The National Bank of Australia recently reported a huge second quarter write-down, which they blamed on massive collateralized debt obligations (CDOs).
And the New Zealand Treasury anticipates a second consecutive quarter of negative GDP growth. By definition, New Zealand will have entered recession once official numbers are released. They'd be the second OECD-member country since Denmark to sink to official recessionary status. The reality is that the big three in the developed world - the U.S. the U.K., and the Eurozone - are staring into the face of recession.
How Does this Big 3 Recession Affect the Next "Superpower?"
As we were so often told when analysts were pushing the decoupling theory, China is set to take over the world.
But if weakness is spreading around the globe, what does that mean for China?
The 2008 Summer Olympics are just now beginning, and there's news that pollution has grown to far worse levels over the last few months. Chinese officials are putting all kinds of limits on how many cars can be on the road on any given day.
Additionally, in an effort to minimize excessive air pollution, Beijing is closing 105 factories. And should conditions worsen, neighboring cities could close as many as 117 factories combined.
Anticipation of the games gave Chinese companies reason to ramp up production. But what's concerning is these companies front-loaded production and an inventory glut is building up.
It makes you wonder how much extra production was jammed into the last quarter in order to prepare for air cleansing before the great games began.
I suspect plenty.
That's never good because they will have to sacrifice growth for as long as it takes to work through the oversupply.
The Commodity and Currency Circle
If the global economy is slowing, and China is forced to work through excess inventory, demand for commodities will be impacted. I'm guessing crude oil prices, in particular, will suffer from the realities I just described.
And remember, commodity prices and currencies influence each other in a self-feeding circle.
For example, falling crude prices could be the one thing that allows U.K. and European central banks to begin lowering their interest rates.
If and when that happens, the dollar will become more attractive relative to those currencies.
It wouldn't take a bold move on the part of the U.S. Federal Reserve, either (nor do I expect one).
A narrowing interest rate disadvantage between the dollar and euro - or the dollar and the pound - would be hugely supportive for the greenback.
In fact, this may very well be why the dollar HAS ALREADY been holding up given such incredibly dismal news day after day from the U.S. economy.
Take a look at this chart ...
Are Oil and the Dollar Finally Breaking Their Inverse Relationship?
Over the last year or so almost everyone's been pointing to the inverse relationship between the U.S. dollar and crude oil.At the very left of the red rectangle on my chart, you can see where the tight inverse correlation began to break down. That's when the dollar bounced higher from its all-time low. Crude soared well beyond its record high at the same time.
Crude rallying and the dollar drifting slowly higher simultaneously? That was certainly no inverse correlation.
But from the furthest right point of that red box is where the tight inverse correlation has resumed. Only this time, the direction is in favor of the dollar. And it comes exactly after a new all-time high for crude prices.
Translation: The buck could be back.
The dollar has been able to continue its rally this week, even amidst a blitzkrieg of central bank announcements. While it has a long way to go - and recovery may not be swift - I think it's time to keep the dollar rally scenarios in clear sight. Especially now that other economies are catching the bug.
JACK CROOKS, Editor of The Money Trader and World Currency Options http://www.sovereignsociety.com/2008Archives2ndHalf/81108IstheDollarReallyMakingaComebackTou/tabid/4388/Default.aspx
FCC Commissioner: Return of Fairness Doctrine Could Control Web Content McDowell warns reinstated powers could play in net neutrality debate, lead to government requiring balance on Web sites. By Jeff Poor Business & Media Institute 8/13/2008 9:08:51 AM There’s a huge concern among conservative talk radio hosts that reinstatement of the Fairness Doctrine would all-but destroy the industry due to equal time constraints. But speech limits might not stop at radio. They could even be extended to include the Internet and “government dictating content policy.” FCC Commissioner Robert McDowell raised that as a possibility after talking with bloggers at the Heritage Foundation in Washington, D.C. McDowell spoke about a recent FCC vote to bar Comcast from engaging in certain Internet practices – expanding the federal agency’s oversight of Internet networks. The commissioner, a 2006 President Bush appointee, told the Business & Media Institute the Fairness Doctrine could be intertwined with the net neutrality battle. The result might end with the government regulating content on the Web, he warned. McDowell, who was against reprimanding Comcast, said the net neutrality effort could win the support of “a few isolated conservatives” who may not fully realize the long-term effects of government regulation. “I think the fear is that somehow large corporations will censor their content, their points of view, right,” McDowell said. “I think the bigger concern for them should be if you have government dictating content policy, which by the way would have a big First Amendment problem.” “Then, whoever is in charge of government is going to determine what is fair, under a so-called ‘Fairness Doctrine,’ which won’t be called that – it’ll be called something else,” McDowell said. “So, will Web sites, will bloggers have to give equal time or equal space on their Web site to opposing views rather than letting the marketplace of ideas determine that?” McDowell told BMI the Fairness Doctrine isn’t currently on the FCC’s radar. But a new administration and Congress elected in 2008 might renew Fairness Doctrine efforts, but under another name. “The Fairness Doctrine has not been raised at the FCC, but the importance of this election is in part – has something to do with that,” McDowell said. “So you know, this election, if it goes one way, we could see a re-imposition of the Fairness Doctrine. There is a discussion of it in Congress. I think it won’t be called the Fairness Doctrine by folks who are promoting it. I think it will be called something else and I think it’ll be intertwined into the net neutrality debate.” A recent study by the Media Research Center’s Culture & Media Institute argues that the three main points in support of the Fairness Doctrine – scarcity of the media, corporate censorship of liberal viewpoints, and public interest – are myths. http://businessandmedia.org/articles/2008/20080812160747.aspx
Soldiers pay bag fee on travel to war
VFW seeks airline waiver, not reimbursement form
American Airlines is charging troops for their extra baggage, a practice that forces soldiers heading for a war zone in Iraq to try to get reimbursement from the military. One of the country's largest veterans groups is asking the aviation industry to drop the practice immediately.
American, which recently charged two soldiers from Texas $100 and $300 for their extra duffel bags, said it gives the military a break on the cost for excess luggage and that the soldiers who incur the fees are reimbursed.
"Because the soldiers don't pay a dime, our waiver of the fees amounts to a discount to the military, not a discount to soldiers," said Tim Wagner, spokesman for American Airlines. "Soldiers should not have to pay a penny of it."
Veterans of Foreign Wars (VFW) spokesman Joseph Davis said service members destined for Iraq should not have to spend the money out of pocket and should not have to worry about filing expense forms in a war zone.
"That's a lot to ask when the service member has much more important things on their minds, such as staying alive and keeping those around them alive," he said.
The VFW is asking the Air Transport Association (ATA) to urge member airlines to exempt military personnel traveling on official orders from all excess-baggage fees. "This should not be a very difficult decision to make," Mr. Davis said.
Several airlines have instituted cost-cutting measures and have eliminated or are charging for amenities including meals, beverages and additional luggage.
In a letter to the ATA on Friday, VFW President George J. Lisicki said troops understand the financial constraints the airline industry faces but that the military traveler represents a minute fraction of the total passengers carried every year.
An ATA spokesman said the association will respond directly to the veterans association.
In a written statement to The Washington Times, James C. May, president and chief executive officer of the ATA, said it is individual airlines that must determine fare rates.
"While ATA cannot by law even suggest uniform pricing policies to our members, we will bring this matter to their attention for their independent consideration," Mr. May said.
"Air Transport Association member airlines have always been committed to supporting our nation's military," he said.
"Airlines routinely offer special fares for military personnel and families, attempt when possible to accommodate unplanned schedule changes and generally seek to do what they can to show their appreciation," Mr. May said.
Most major U.S. carriers waive baggage fees for up to two bags for military members traveling under orders, Mr. Lisicki said. However, a $100 fee for checking a third bag appears to be the industry norm, except for first-class passengers or elite frequent fliers.
US Airways allows military personnel with identification free luggage up to 100 pounds, and Delta allows two bags up to 70 pounds in the cargo hold, as does Northwest.
When soldiers receive their travel orders, they should make sure that excess baggage is authorized and that soldiers can be reimbursed for additional fees that airlines impose, said Army spokesman Paul Boyce.
"We can help them with additional expenses for travel, but soldiers have to submit a receipt and it has to be looked at by our finance people," Mr. Boyce said.
"We appreciate the VFW's help in assisting soldiers. It would certainly make it easier for soldiers, but there are other ways to help them recoup their money for Army travel," Mr. Boyce said.
http://www.washingtontimes.com/news/2008/aug/12/soldiers-pay-bag-fee-on-travel-to-war/
FDIC Fund Strained by Bank Failures May Lift Premiums (Update2)
By Alison Vekshin
Aug. 11 (Bloomberg) -- The failure of IndyMac Bancorp Inc. and seven other banks this year may erase as much as 17 percent of a government insurance fund and raise premiums for all banks, from Franklin National of Minneapolis to Bank of America Corp.
The closing of IndyMac in July, the third-biggest U.S. bank failure, may cost the Federal Deposit Insurance Corp.'s fund $4 billion to $8 billion, in addition to an estimated $1.16 billion for seven closures through Aug. 1. Premiums for insuring deposits will likely rise, FDIC Chairman Sheila Bair said in a July 30 interview. A decision is due by the fourth quarter.
``It's going to be a bloody, expensive mess for the banking industry,'' said Bert Ely, president of Ely & Co. Inc., a bank consulting firm based in Alexandria, Virginia. ``Healthy banks are paying for the mistakes made by failed banks.''
The pace of bank closings is accelerating as financial firms have reported almost $495 billion in writedowns and credit losses since 2007. The FDIC's ``problem'' bank list grew by 18 percent in the first quarter from the fourth, to 90 banks with combined assets of $26.3 billion. A revised list is due this month. The insurance fund had $52.8 billion as of March 31.
The FDIC estimated its shutdown of California-based mortgage lender IndyMac, which filed to liquidate its assets last month, might drain as much as 15 percent from the fund. Seven other banks will take $1.16 billion, or about 2 percent.
The potential $9.16 billion in withdrawals would be the highest since the insurance account was created in 1933, Diane Ellis, the FDIC's associate director of financial-risk management, said in a telephone interview. Bank failures pulled a record $6.9 billion from the fund in 1988 during the savings- and-loan collapse, Ellis said.
Replenishing
The FDIC is required to shore up the fund when the reserve ratio, or the balance divided by the insured deposits, slips below 1.15 percent or is forecast to fall below that level within six months. A 2006 law directs the agency to take steps to reach the 1.15 percent ratio within five years.
``Raising rates is our first and best option if we need to get more revenue to increase the fund and the reserve ratio,'' Ellis said.
The ratio fell to 1.19 percent in the first quarter from 1.22 percent the previous quarter, the agency reported in March. IndyMac's collapse may push it down at least 9 basis points, to below the 1.15 percent threshold, Ellis said. A basis point is 0.01 percentage point.
Premiums (you can read the rest here)
http://www.bloomberg.com/apps/news?pid=20601087&sid=abahg9z7p4wU&refer=worldwide
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