NEWS Continued

Planned U.S. layoffs jumped 8.6 percent in December, pushing the 2005 annual total of job cuts 3.1 percent higher than in 2004.

The increases were due in large part to big increases in job cuts within the government, non-profit and automotive sectors, said Challenger, Gray & Christmas Inc., an employment consulting firm.

(Source Reuters January 5,2006)

In 1979, Moody's gave 61 companies its highest AAA rating. Ten years ago, that number was 21. Three years ago, it was nine. The latest casualties were Bristol-Myers Squibb in 2002, Merck in November and AIG last week. (Source San Francisco Gate April 7, 2005)

More than half of the steel buyers polled by the Institute of Supply Management in the fourth quarter expressed concern about supply of steel flat-rolled, plate and bar products through mid-2006. Also cited in Purchasing magazine surveys are aluminum plate, extrusions and wire products; copper mill products of all types; and every conceivable shape of titanium (Purchasing.com January 12, 2006).

November sales of previously owned homes fell an annual 11.2 percent in California (Source RIS Media Dec 28 2005)

Sales of apartment buildings to condo converters reached a record $13.3 billion last year, up from $3 billion in 2003, according to Real Capital Analytics, which tracks sales of at least $5 million (New York Times May 18, 2005)

Borrowers replacing junk bonds with bank loans during the worst start to a year for the high-yield, high-risk debt market in more than a decade.( Source Bloomberg May 9, 2005)

General Motors and Ford debt downgraded to junk May 5, 2005

A study of the top 99 U.S. real estate markets announced today by the economics department of National City Corp. finds housing "bubblettes" in one-fifth of the U.S. housing stock, labeled as areas with home premiums in excess of 20 percent (National City Feb 2005)

Greenspan said the size of Fannie Mae's and Freddie Mac's portfolios, a combined $1.55 trillion, poses a risk to the global financial system (Source Bloomberg April 6, 2005)

Goldman Sachs' research looks in depth at housing prices in the United States, the UK, and Australia, and estimates that prices are, respectively, 10, 15, and 29 percent higher than they ought to be based on market fundamentals. (Source The Atlantic Nov 2004)

Real estate investment trusts also fell sharply last month (January 2005), as the Dow Jones Composite REIT Index lost 8.3 percent. (source CBS market watch 2-5-05 )
U.S. housing starts unexpectedly rose to a 21-year high in January paced by record construction of single-family homes (Bloomberg 2-16-05)

3 file pleas in $5 million mortgage fraud scam in Cincinnati (The Enquirer 2-2-2005 )

Foreclosures in the Denver metro area increased 29 percent in 2004 to 12,166, making 2004 the second-worst year on record (Business Journal 2-1-2005)

The number of job cuts by U.S. employers in 2004 topped the 1 million mark for the fourth straight year, the outplacement firm Challenger Gray & Christmas said Jan. 5 (International Labor Communications Association)

December report by Chapman University economists projected that home prices in Orange County will decline 7.4 percent in 2005. The economists noted that the unsold housing inventory in the county has increased from a 2.5-month supply to 7.7 months. (Source San Diego Union Tribune January 2, 2005 Several hurdles stand in the way of U.S. economic growth this year)

The national foreclosure rate on subprime loans, a vehicle for predatory lenders, is roughly 10 times that for all loans (News Observer 1-27-05)

At the bottom of the last two cycles — in 1991-92 and in 2001-2002 — more than 10 per cent of junk bond issuers defaulted, failing to pay some or all of the interest and principal owed.

That raises the chilling possibility that in the next global downturn or recession, issuers of perhaps $120 billion (£66 billion) of bonds could default. (Source Times Online May 26, 2005)

Sales of new homes fell 6.4 percent in July (CBS Market Watch)

Sales of existing US homes fell 2.9 percent in July (Source CNN Money)

Wal-Mart cuts August sales projections (Source Reuters)

In reviewing the retail sector's performance history, Fitch thinks retail is an area of particular concern as the tapping of home equity appreciation, the source of much consumer spending, fades along with the low interest rate environment (Source Business Wire). (Fitch provides private ratings on companies and their debt instruments).

Boston's office rents slide as vacancy rate soars (Boston 11-1-04 )

The composite value of Class A commercial real estate in the United States continues to appreciate, rising 4.2% during the most recent 12 months (Sourece 4th Quarter 2004, National Real Estate Index by Global Real Analytics.)