Subprime Borrowers to Lose Homes at Record Pace as Rates Rise

Sept. 19 (Bloomberg) -- As many as half of the 450,000 subprime borrowers whose mortgage payments increase in the next three months may lose their homes because they can't sell, refinance or qualify for help from the U.S. government.

``Short of the cavalry riding in over the hill, a lot of these people are just stuck,'' said Christopher Cagan, director of research and analytics at Santa Ana, California-based First American CoreLogic, the risk management unit of the biggest U.S. title insurer. BLOOMBERG

Toll Brothers CEO sees downturn worse than 1980s

NEW YORK, Sept 18 (Reuters) - Toll Brothers Inc (TOL.N: Quote, Profile, Research) Chief Executive Robert Toll said on Tuesday the Federal Reserve's rate cut may signal that the economy is worse than previously thought and likely doesn't indicate the U.S. housing market has hit bottom.

Earlier Tuesday, the Federal Reserve slashed the key federal funds rate by a half-percentage point, the first cut in the rate in more than four years.

"I would have done a quarter instead of a half because it signals we're in deep doodoo," Robert Toll said, speaking at the Credit Suisse Homebuilder Conference. REUTERS

US expert warns of fresh shocks

Fresh economic shocks on the scale of the current credit squeeze will occur if US house prices continue to fall, one of the country’s leading housing experts warned on Wednesday.

Robert Shiller, a Yale university economist, told a US congressional panel that he feared “the collapse of home prices might turn out to be the most severe since the Great Depression”. FINANCIAL TIMES

Goldman Net Rises 79 Percent, Lifted by Mortgage

Sept. 20 (Bloomberg) -- Goldman Sachs Group Inc. reported the third-best profit in its 138-year history after betting against the mortgage bonds that triggered the credit-market rout and damaged earnings at Lehman Brothers Holdings Inc. and Bear Stearns Cos.

The world's largest securities firm said net income rose 79 percent in the third quarter to $2.85 billion, or $6.13 a share, from $1.59 billion, or $3.26, a year earlier. Goldman shares rose as earnings beat the $4.35-a-share average estimate of 18 analysts surveyed by Bloomberg, the seventh straight quarter that the New York-based company has surpassed expectations. BLOOMBERG

Bear Stearns Net Drops Most in Decade on Credit Rout

Sept. 20 (Bloomberg) -- Bear Stearns Cos., the securities firm hit the hardest by the collapse of the subprime mortgage market, reported its biggest profit decline in more than a decade. The shares rose after the company said the worst is over.

Third-quarter net income dropped 61 percent to $171 million, or $1.16 a share, in the three months ended Aug. 31 from $438 million, or $3.02, a year earlier, the New York-based firm said today in a statement. Profit fell short of analysts' estimates. BLOOMBERG

Oil Hovers Above $82 on Worries of Supply Crunch

Oil hovered around $82 a barrel on Thursday as sinking U.S. crude inventories and the threat of a storm gathering near Florida increased worries of a winter supply crunch in the world's top consumer.

Oil has traded above $80 for the past week but OPEC officials and oil analysts say the lofty price is unsustainable. CNBC