Burlingame, CA

Bernanke: Recession Is Over, but Tough Times Will Linger

The deep recession that's gripped the U.S. economy by the throat since December 2007 is "very likely over at this point," Federal Reserve Chairman Ben Bernanke recently said.

However, Bernanke painted a picture of an underperforming economy well into next year as he fielded questions after a speech at the Brookings Institution, a center-left research center in the nation's capital.

"From a technical perspective the recession is very likely over," Bernanke said, cautioning that unemployment is likely to remain high. "It's still going to feel like a very weak economy for some time, as many people will still find that their job security and employment status is not what they wish it was. So that's a challenge for us and all policymakers going forward."

Most mainstream economists think that the National Bureau of Economic Research, the official scorekeeper of when recessions begin and end, eventually will declare that this downturn came to an end in the summer or early fall of 2009.

What follows may not feel much like recovery, Bernanke cautioned, because structural problems in the U.S. economy are likely to resurface. There will be economic growth during the rest of this year, "but the general view of most forecasters is the pace of growth in 2010 will be moderate, less than you might expect, given the depth of the recession, because of ongoing head winds." The "head winds" he referred to include an impaired credit system, households still trying to dig out from personal debt and ongoing adjustments in many sectors of the economy, such as construction and autos.

In addition, the government must unwind many of its massive stimulus efforts or risk igniting inflation. That's all likely to lead to a weaker recovery than after past recessions, and a lingering high unemployment rate.

The sluggish outlook was punctuated by August retail sales data recently released by the Commerce Department. Sales rose by 2.7% over July, driven up by the government's "cash for clunkers" car sales program and higher gasoline prices. Drop those two factors, and retail sales rose by only 0.6%. That's another sign of consumer reluctance to spend amid widespread job insecurity.

"The various fiscal stimulus measures, including the cash for clunkers program, are playing a pivotal role in jump-starting the economy in the third quarter of 2009, and that should create enough initial momentum to keep the recovery in motion, but we should not be looking for consumer spending to be a major driver of the recovery beyond the current quarter," Brian Bethune, a U.S. economist for forecaster IHS Global Insight, warned in a research note.

Looking over a longer horizon, Bernanke said that a major factor in the recent global expansion of credit was significantly impaired and unlikely to revive anytime soon. The implication: less lending and at higher costs. The Fed chief was referring to securitization, the process by which loans are sold to Wall Street firms that bundle them together into securities that are sold to investors. Their returns on investment come from monthly payments that consumers make on their homes, cars, credit cards and student loans.

Securitization is in a deep freeze right now because investors no longer want pooled loans, fearing defaults by consumers and businesses. This is one reason it's so difficult now for consumers to get credit to buy cars or houses. Bernanke warned that even when this process resumes, it's unlikely to be as vigorous as it was during the go-go days earlier this decade.

"My forecast would be that the shadow banking system - securitization markets - will come back, will be a substantial part of the U.S. credit system. But they will certainly, at least in the medium term, be simpler, smaller, less opaque, subject to more oversight by regulators," Bernanke said. "And those things, I think, will constrain its growth for a period of time."

No Rest for the Weary: 75% of Americans Plan on Working as Long as They Can

A new study released by Bankrate, Inc. shows that the vast majority of working Americans plan to work as long as they can during retirement age, showing a redefinition of how Americans view traditional retirement plans. The poll, conducted by Princeton Survey Research Associates International, is included in the new Bankrate Financial Literacy series on Retirement Income.

Among the findings:

-75% of Americans plan to work as long as they can during retirement age. 39% plan to work because they enjoy work while almost one-third plan to work because they'll need the money;
-Although so many Americans plan on working through retirement age, only 15% of retirees polled are currently employed compared to 84% who are not;
-55% of retirees worry about money and wish they had saved more compared to only 38% who think they have enough money to retire without worry;
-The financial crisis has affected many people's plans to retire with only 31% expecting to retire on time as planned while 40% plan on postponing their retirement plans;
-53% of Americans made no changes to their investments due to the financial crisis compared to 14% who went with a more conservative investment approach;
-Almost 40% of Americans are investing for retirement on their own with 16% using an asset allocation plan, 15% picking mutual funds based upon performance, and 8% with a target date fund. Twenty-seven percent use a financial adviser for decisions while 18% don't invest in a retirement plan and 9% don't utilize any strategies;
-Due to a lack of pension plans like today's workforce, 26% of retirees polled are relying solely on Social Security for their income.

"This poll offers an interesting insight into Americans' views of employment and retirement," said Julie Bandy, editor in chief at Bankrate.com. "Seventy-five percent of today's generation plan to work as long as possible, a far cry from that of previous generations. Falling home values and losses in retirement accounts are forcing many Americans to re-evaluate their retirement needs. "

HERA-HOEPA

Fees & Loan Data that impact APR

Govt Recording/Transf Fees:

· Recording Fee/Assignment

· Subordination/Modification

3rd Party Fees:

· Broker Compensation Fee

· Courier/Messenger Fee

· EDD to 3rd Party

· Fax/Copies/Postage

· Final Inspection

· Flood Life of Loan

· HOA Cert Fee

· Home Warantee

· Mortgage Ins Ap Fee

· Processing Fee

· Re-Draw Fee

· Reconveyance Fee

· Tax Service Fee

· Transfer Fee

· Underwriting Fee

· Wire Transf Fee

Lender Fees:

· Application Fee

· Assumption Fee

· Commitment Fee

· Discount Fee

· Lock extension fee

· Lock extension fee

· Return to Float Fee

· Lock in Fee

· Modification Fee

· Mortgage Broker Comp. Fee

· Origination Fee

· Processing Fee

· Underwriting Fee

· Holdback Fee

Title/Closing/Settlement:

· Closing/Escrow/Settlement

· Mortgage Insurance Fee

· Doc Review

· Escrow/Loan Tie in Fee

· PMI/MIP

· Recording

· Servicing Fee

· Temp. Buydown Fee

· Trust review

· Upfront Mtg Ins.

· Va Funding Fee

Loan Data:

· Per Diem Interest

· Loan Amount

· Interest Rate

· Loan Product

Kiva

How does it work?

Kiva brings together lenders and worthy enterprises on the web.

From Kenya to Ecuador, microfinance institutions (MFI) around the world go to Kiva.org and post photos and profiles of low income entrepreneurs in need of money for their businesses.Loans made easy and personal.

Lenders go to Kiva.org and browse through profiles of low-income entrepreneurs-a dairy farmer in Kenya, a man who wants to open a shoe shop in Honduras, or a tailor in Bulgaria. Lenders can then loan as little as $25 to the entrepreneur of their choice via PayPal, a globally recognized online payment service.When a loan is funded by individual lenders, Kiva pools the money and transfers it to a Microfinance partner who handles distribution and collection of loan payments.

Journal updates keep the lenders informed about the progress of the entrepreneur they sponsored. Loan repayments made by the entrepreneur over the course of about 6-18 months are sent back to Kiva by the MFI partner.Once loans are repaid, Kiva users can choose to withdraw their principal or re-loan to another entrepreneur. (80%+ of Kiva lenders choose to re-loan!

Kiva Shows You Where Your Money Goes Unlike donations which usually go into general funds, Kiva loans show you exactlyWHO your money goes to, WHAT they are doing with it, and HOW you are making a difference. Best part? It's a loan, not a donation. We invite you to make a small loan and make a big difference!

Kiva is a regisitered 501(3)(c) non-profit based out of San Francisco, CA

www.kiva.org

GET repaid within months. Withdraw your money or lend again! WATCH your entrepreneur's small business grow via email updates SELECT an entrepreneur and make a small loan (as little as $25)

KIVA TRANSFERS funds abroad to a microfinance partner who administers the loan loans that change lives Kiva.org is a non-profit that is revolutionizing the fight against global poverty by enabling people to connect with and make personal loans-of as little as $25-to low-income entrepreneurs in the developing world. Most of the poor in developing countries are self-employed entrepreneurs and a small loan to purchase business-related items such as sewing machines or livestock can empower them to earn their way out of poverty."Innovation of the W eek: Kiva.org uses smart design to make a little cash go a long way."

"Revolutionizing how donors and lenders in the US are connecting with small entrepreneurs in developing countries."

"If you've got 25 bucks, a PC and a PayPal account, you've now got the wherewithal to be an international financier."

"Kiva simply democratizes access to a worldwide microfinance movement that has been empowering the working poor for two decades."

"At Kiva.org, a schoolteacher in K ansas can partner with an expert seamstress in countries like Kenya, Mexico and E cuador to jump-start a tailor shop."

1. Forget to mention that you just bought a new car or stereo system.
2. Forget to mention that you have to pay child support or alimony.
3. Forget to mention that you will be going on maternity leave during the escrow.
4. Forget to mention that the money you are using for the down payment and closing costs are coming from a gift from family and there is not way to document it.
5. Forget to mention that one of the borrowers (husband/wife) hasnt recieved green card yet, or greencard is expiring.
6. Forget to mention that the borrower is married (applied as single man/woman), and let the lender discover it when you sign loan papers.
7. Have the money needed to close escrow come from the sale of another property that hasnt closed yet, and you need to close this escrow first.
8. Apply on line with one of these online companies and have your credit report run 10 times in a row, guaranteed to change your fico scores to qualify.
9. Create your own paystub, bank statement or w-2, tax return.
10. When the lender audits your loan file before coe by calling your employer to verify your employment, make sure you have quit or are on unpaid leave.