B.of A, Wells Fargo, Citigroup down graded by Moodys

Moody's Investors Service lowered the debt ratings for Bank of America Corp., Wells Fargo & Co. and Citigroup Inc., saying it is now less likely that the U.S. government would step in and prevent the lenders from failing in a crisis.

The ratings firm said Wednesday that it believes the government is likely to provide some level of support for financial institutions, but is also more likely now than during the 2008 financial crisis to allow a large bank to fail should it become financially troubled.

The downgrades were widely expected after the three banks were placed on review by the ratings agency in June. They also stem partly from new laws that went into effect under the Dodd-Frank Wall Street Reform Act that was passed last year. The new law ended the possibility of the government bailing out a large financial firm and creates a way to liquidate failed financials.

Bank of America was the worst hit - with a two-notch downgrade in its key long-term debt ratings to Baa1 from A2. Wells Fargo's long-term debt was downgraded by one notch to A2 from A1, while Citigroup's rating remained the same at A3. However, Moody's downgraded Citi's short-term debt.

Moody's also downgraded the rating on both Bank of America and Wells Fargo for deposits.

All of the ratings are investment grade.

US Housing Data gets Worst, BofA starts demolitons

Bank Of America Bulldozes And Gives Away Homes To Cut The Glut

Read more: http://www.businessinsider.com/bank-of-america-gives-away-bulldozes-homes-2011-7#ixzz1TagBtPwV

BofA, Goldman Sachs Find State Mortgage Cases Hard to Shake.

http://www.businessweek.com/news/2011-07-29/bofa-goldman-sachs-find-state-mortgage-cases-hard-to-shake.html.

The US Banks have still drawning Under the Sub Prime Mortgage Crisis and are getting desperate to shake the ailment. BofA, has started removing the houses by bulldozer, and saving the cost of maintainable expenses. The indicators are much similar to as given in ' Rich Dad, Poor Dad'.

However, Never thought I shall witness them.

                                       The Analysis of New Home sales in US 

The warmer weather of spring and early summer has yet to bolster new home purchases, as sales of new single-family homes were down again in June 2011. Sales dipped another 1.0% in June to a seasonally adjusted annual rate (SAAR) of 312,000 homes, according to a July 26, 2011, report published by the U.S. Census Bureau.

Not all of the country suffered, however. The Northeast and West saw declines in sales of 15.8% and 12.7%, respectively, while sales were up 3.4% and 9.5% in the South and Midwest, respectively. But despite the pockets of improvement, the overall drop in June brings annualized home sales closer to record lows after declining 0.6% in May. Sales peaked at 1,389,000 homes in July 2005 and declined 77.5% through June 2011.

Meanwhile, the inventory of new homes for sale (164,000 units) in June declined to the lowest level since 1963. When new home sales are slow and inventory is depressed, it creates less competition and price strain on existing homes. However, an imbalance exists between supply and demand in the housing market; the lack of demand and high supply of existing homes (including shadow inventory) continue to hurt both the new and existing housing markets. This week's weak new home sales and last week's disappointing existing home sales data highlight the continued weakness in the overall U.S. housing sector.

The median price of new houses sold in June was $235,200, while the median price of existing homes sold during the same month was $184,300. As a result, median prices on new homes were 28% higher than prices on existing homes in June, which is higher premium than the historical level of roughly 15%. Therefore, when making a choice based on price, buyers are likely to prefer existing or even distressed homes over new ones. We expect this high premium to continue to sway consumer demand to existing homes and somewhat damper new home sales. We see this as a positive for existing home sales and prices to an extent. Overall, however, we believe it will take years for the new home market to regain a strong footing.

The home sales activities provide insights on the direction and movement of U.S. home prices as key economic trends. In general, new home sales data tend to lead existing home sales. This is because new home sales are counted in the report when the buyer signs the initial home sales contract (similar to the pending sale of existing homes) versus existing home sales, which are counted when buyers complete the purchase. Despite a modest decline in new home sales this month, we believe low levels of new home sales and a record low new home inventory may somewhat aid in the slow recovery of the existing housing market.