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Contract Negotiations Threaten To Derail The World’s Largest Copper Mine

It’s contract negotiation season in the world’s largest copper-producing nation, Chile. And news this week suggests that the country’s biggest mining operation may be headed for some tense discussions with workers. That’s Escondida, the world’s biggest copper mine — where workers issued a challenge to management this past week, asking for more cash even as profits are falling. Local press reported that Escondida’s top union — representing 2,500 mineworkers — has asked for an overall bonus of…


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Oil Falls After API Reports The Biggest Crude Inventory Build In 6 Weeks

Oil prices fell on Wednesday after having to 18-month highs as oil markets are anticipating OPEC cuts that are expected to be made starting January 1 next year. The American Petroleum Institute’s (API) weekly report showed build of 4.2 million barrels to the United States’ commercial crude inventories, instead of an expected 1.5 million-barrel draw. The build comes after last week’s report from the Energy Information Administration (EIA) that showed a build of 2.3 million barrels of crude oil in inventories the week prior.…


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Oil Falls After API Reports The Biggest Crude Inventory Build In 6 Weeks

Oil prices fell on Wednesday after having to 18-month highs as oil markets are anticipating OPEC cuts that are expected to be made starting January 1 next year. The American Petroleum Institute’s (API) weekly report showed build of 4.2 million barrels to the United States’ commercial crude inventories, instead of an expected 1.5 million-barrel draw. The build comes after last week’s report from the Energy Information Administration (EIA) that showed a build of 2.3 million barrels of crude oil in inventories the week prior.…


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Oil Falls After API Reports The Biggest Crude Inventory Build In 6 Weeks

Oil prices fell on Wednesday after having to 18-month highs as oil markets are anticipating OPEC cuts that are expected to be made starting January 1 next year. The American Petroleum Institute’s (API) weekly report showed build of 4.2 million barrels to the United States’ commercial crude inventories, instead of an expected 1.5 million-barrel draw. The build comes after last week’s report from the Energy Information Administration (EIA) that showed a build of 2.3 million barrels of crude oil in inventories the week prior.…


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State officials wanted OCS off California included in permanent ban

California Gov. Jerry Brown (D) and Coastal Commission Chair Dayna Bochco each asked US President Barack Obama on Dec. 13 to add federal waters off the state’s coast to portions of the US Outer Continental Shelf he permanently closed to future oil and gas activity a week later under Section 12-A of the 1953 OCS Lands Act.


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Israeli authorities demolish Palestinian structures in East Jerusalem

Israel’s Jerusalem municipality demolished Palestinian-owned structures in the occupied East Jerusalem neighbourhood of Silwan today, under the pretext that they lacked Israeli-issued building permits, according to local organisation the Wadi Hilweh Information Centre. The centre said that municipality crew, accompanied by Israeli police forces, destroyed three containers and a steel structure belonging to the Siyam family in the Ein Al-Luza neighbourhood of Silwan. The structures were being used for agricultural purposes. Local sources said that parts of a store – measuring some 10 square metres – belonging to the Abu Hadwan family was also demolished in the area. A spokesperson for the Jerusalem municipality could not immediately be reached for comment on the demolitions. Demolitions of Palestinian structures and homes […]


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House Flipping Makes A Comeback As 2016 Volume Soars To Highest Since 2007

Ten years after one of the largest asset corrections in history nearly brought down the entire global financial system, house flippers are making a comeback in a big way.  Just ask Eduardo Axtle, a 35-year-old former telecom entrepreneur (which we assume means Verizon store clerk) in Oakland, California, who say that “the floodgates have opened” and allowed him to take out 50 home loans over the past couple of years.  But we’re sure Yellen & Co. were right, 0% interest rates for nearly a decade were a fantastic idea.

Per the Wall Street Journal, home flipping volume in the first three quarters of 2016 reached levels not seen since 2007…

House Flipping Volume

 

…driven by rising home prices and the ability to extract pre-recession level gross profit from flips.

House Flipping

 

But, of course, like last time around, none of this would be possible without a little help from Wall Street.  But, since new regulations imposed after the previous housing collapse restrict the types of home loans that the large banks can make, they had to get creative with structuring and have decided to fund other “online lenders” rather than going straight to the borrower.  In fact, JP Morgan recently bankrolled 5Arch Funding of Irvine, California with $60 million.

In recent months, big banks, including Wells Fargo & Co., Goldman Sachs Group Inc. and J.P. Morgan Chase & Co. have started extending credit lines to companies that specialize in lending to home-flippers. Earlier this month, J.P. Morgan agreed to lend $60 million to 5Arch Funding, an Irvine, Calif., company that caters to flippers, according to people familiar with the deal.

 

Trying to win business, big banks in the past few weeks have flown executives to Southern California—where much of the house-flipping activity is occurring—to organize funding deals, people familiar with the meetings say.

 

Some borrowers say they have been offered debt in excess of the value of the home, also known as the loan-to-value ratio. Others say some lenders are requiring bank statements to get a loan, but not standard documentation such as a W-2 tax earnings statement.

 

As these loans are made by relatively small finance companies and aren’t classified as owner-occupied loans, they don’t fall under many of the postcrisis rules written for banks and home mortgages. Some banks used to make these loans directly but now fund finance companies instead.

 

The boom is being accelerated by online lenders such as San Francisco-based LendingHome Corp. and Asset Avenue Inc. in Los Angeles, as well as crowdfunding websites such as Groundfloor Finance Inc., that allow individual investors to fund fix-and-flip loans. LendingHome, backed by venture capital investors, says it has extended more than $1 billion in loans in the 2 ½ years since its launch.

Now, we know what you’re thinking…“this sounds like 2007/2008 all over again!”  But JP Morgan insists that there is no reason for concern because their risk is “backed by pools of securitized loans…”  Nevermind, apparently it is exactly like 2007/2008.

Finance companies say their loans to home-flippers are prudent. LendingHome, for example, says it limits its average loan size to reduce risk.

 

Big banks are offering lenders credit lines ranging from $5 million to $150 million, with interest rates between 3.5% and 6%, say the people familiar with the deals.

 

The banks say they are shielded from major losses because their loan deals are backed by pools of securitized loans, sheltering them from a potential bankruptcy of the lender. In the 5Arch deal with J.P. Morgan, for example, the bank securitized 150 5Arch loans in the $60 million bond, and then lent out a portion of that amount back to 5Arch in what operates like a credit line. The bank can also sell pieces of the resulting bond to other investors if it chooses.

Meanwhile, RealtyTrac points out that the largest flipping markets, to our complete shock, are:  Florida, California and Las Vegas.  Perfect.

Among 92 metropolitan statistical areas with at least 90 homes flipped in Q3 2016, those with the highest flipping rate were Memphis (11.0 percent); Clarksville, Tennessee (9.5 percent): Deltona-Daytona Beach-Ormond Beach, Florida (9.3 percent);  Tampa-St. Petersburg, Florida (9.3 percent); and Visalia-Porterville, California (9.3 percent).

 

Other markets in the top 10 for highest flipping rate were York-Hanover, Pennsylvania (9.2 percent); Lakeland-Winter Haven, Florida (9.0 percent); Fresno, California (8.7 percent); Miami (8.6 percent); and Las Vegas (8.2 percent).

And here’s a helpful interactive map that highlights that biggest danger zones for new home buyers.

100 Hottest Home Flipping Zips Q3 2016

And while most are rushing into the market, others, who actually experienced the last correction, have grown concerned by the mania of the home flipping masses.

George Geronsin, 36, a Southern California real-estate agent and house-flipper who has been in the business since 2008, said he recently sold the majority of the homes he was working on and is sitting on cash “until the next big correction” in the housing market.

 

“Anybody and everybody is getting into the business of house-flipping—that’s when you know it’s the end of the rope,” said Mr. Geronsin.

 

Investors in one large crowdfunding site, Realty Mogul Co., were interested in funding $1 billion in fix-and-flip loans through its marketplace, said Chief Executive Jilliene Helman. But the company decided to stop making such loans this summer because competition among lenders meant it couldn’t charge a high enough interest rate to make up for the risk.

Of course, we wouldn’t worry too much about those spiking mortgage rates and collapsing refi’s…it’s probably not a big deal

The post House Flipping Makes A Comeback As 2016 Volume Soars To Highest Since 2007 appeared first on crude-oil.top.


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House Flipping Makes A Comeback As 2016 Volume Soars To Highest Since 2007

Ten years after one of the largest asset corrections in history nearly brought down the entire global financial system, house flippers are making a comeback in a big way.  Just ask Eduardo Axtle, a 35-year-old former telecom entrepreneur (which we assume means Verizon store clerk) in Oakland, California, who say that “the floodgates have opened” and allowed him to take out 50 home loans over the past couple of years.  But we’re sure Yellen & Co. were right, 0% interest rates for nearly a decade were a fantastic idea.

Per the Wall Street Journal, home flipping volume in the first three quarters of 2016 reached levels not seen since 2007…

House Flipping Volume

 

…driven by rising home prices and the ability to extract pre-recession level gross profit from flips.

House Flipping

 

But, of course, like last time around, none of this would be possible without a little help from Wall Street.  But, since new regulations imposed after the previous housing collapse restrict the types of home loans that the large banks can make, they had to get creative with structuring and have decided to fund other “online lenders” rather than going straight to the borrower.  In fact, JP Morgan recently bankrolled 5Arch Funding of Irvine, California with $60 million.

In recent months, big banks, including Wells Fargo & Co., Goldman Sachs Group Inc. and J.P. Morgan Chase & Co. have started extending credit lines to companies that specialize in lending to home-flippers. Earlier this month, J.P. Morgan agreed to lend $60 million to 5Arch Funding, an Irvine, Calif., company that caters to flippers, according to people familiar with the deal.

 

Trying to win business, big banks in the past few weeks have flown executives to Southern California—where much of the house-flipping activity is occurring—to organize funding deals, people familiar with the meetings say.

 

Some borrowers say they have been offered debt in excess of the value of the home, also known as the loan-to-value ratio. Others say some lenders are requiring bank statements to get a loan, but not standard documentation such as a W-2 tax earnings statement.

 

As these loans are made by relatively small finance companies and aren’t classified as owner-occupied loans, they don’t fall under many of the postcrisis rules written for banks and home mortgages. Some banks used to make these loans directly but now fund finance companies instead.

 

The boom is being accelerated by online lenders such as San Francisco-based LendingHome Corp. and Asset Avenue Inc. in Los Angeles, as well as crowdfunding websites such as Groundfloor Finance Inc., that allow individual investors to fund fix-and-flip loans. LendingHome, backed by venture capital investors, says it has extended more than $1 billion in loans in the 2 ½ years since its launch.

Now, we know what you’re thinking…“this sounds like 2007/2008 all over again!”  But JP Morgan insists that there is no reason for concern because their risk is “backed by pools of securitized loans…”  Nevermind, apparently it is exactly like 2007/2008.

Finance companies say their loans to home-flippers are prudent. LendingHome, for example, says it limits its average loan size to reduce risk.

 

Big banks are offering lenders credit lines ranging from $5 million to $150 million, with interest rates between 3.5% and 6%, say the people familiar with the deals.

 

The banks say they are shielded from major losses because their loan deals are backed by pools of securitized loans, sheltering them from a potential bankruptcy of the lender. In the 5Arch deal with J.P. Morgan, for example, the bank securitized 150 5Arch loans in the $60 million bond, and then lent out a portion of that amount back to 5Arch in what operates like a credit line. The bank can also sell pieces of the resulting bond to other investors if it chooses.

Meanwhile, RealtyTrac points out that the largest flipping markets, to our complete shock, are:  Florida, California and Las Vegas.  Perfect.

Among 92 metropolitan statistical areas with at least 90 homes flipped in Q3 2016, those with the highest flipping rate were Memphis (11.0 percent); Clarksville, Tennessee (9.5 percent): Deltona-Daytona Beach-Ormond Beach, Florida (9.3 percent);  Tampa-St. Petersburg, Florida (9.3 percent); and Visalia-Porterville, California (9.3 percent).

 

Other markets in the top 10 for highest flipping rate were York-Hanover, Pennsylvania (9.2 percent); Lakeland-Winter Haven, Florida (9.0 percent); Fresno, California (8.7 percent); Miami (8.6 percent); and Las Vegas (8.2 percent).

And here’s a helpful interactive map that highlights that biggest danger zones for new home buyers.

100 Hottest Home Flipping Zips Q3 2016

And while most are rushing into the market, others, who actually experienced the last correction, have grown concerned by the mania of the home flipping masses.

George Geronsin, 36, a Southern California real-estate agent and house-flipper who has been in the business since 2008, said he recently sold the majority of the homes he was working on and is sitting on cash “until the next big correction” in the housing market.

 

“Anybody and everybody is getting into the business of house-flipping—that’s when you know it’s the end of the rope,” said Mr. Geronsin.

 

Investors in one large crowdfunding site, Realty Mogul Co., were interested in funding $1 billion in fix-and-flip loans through its marketplace, said Chief Executive Jilliene Helman. But the company decided to stop making such loans this summer because competition among lenders meant it couldn’t charge a high enough interest rate to make up for the risk.

Of course, we wouldn’t worry too much about those spiking mortgage rates and collapsing refi’s…it’s probably not a big deal

The post House Flipping Makes A Comeback As 2016 Volume Soars To Highest Since 2007 appeared first on crude-oil.top.


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Oil Slides After Biggest Inventory Build In 6 Weeks

Having risen for the 8th straight day – the longest stretch in 7 years – oil prices kneejerked lower after API reported a surprisingly large 4.8mm inventory build (1.5mm draw expected) – the largest in 6 weeks. Gasoline and Distillates saw draws but Cushing built for the 4th week of the last 5.

 

API

  • Crude +4.2mm (-1.5mm exp) – biggest in 6 weeks
  • Cushing +528k (+500k exp) – 4th build in last 5 weeks
  • Gasoline -2.8mm (+1mm exp)
  • Distillates -1.7mm (+1mm exp)

Following last week’s surprise build, API reported another surprise build this week in overall crude inventories…

 

And the reaction was a kneejerk lower holding below $54…

The post Oil Slides After Biggest Inventory Build In 6 Weeks appeared first on crude-oil.top.