…a total of 2,203,295 foreclosure filings — default notices, auction sale notices and bank repossessions — were reported on 1,285,873 properties nationwide during the year, up 75 percent from 2006. The report also shows that more than 1 percent of all U.S. households were in some stage of foreclosure during the year, up from 0.58 percent in 2006.
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A total of 215,749 foreclosure filings were reported in December, up 97 percent from December 2006 and bringing the fourth-quarter total to 642,150 filings on 527,740 properties — up 1 percent from the previous quarter and up 86 percent from the fourth quarter of 2006.

US Foreclosure Activity Increases 75 Percent In 2007

This paper is a snapshot of the actions lenders took to assist borrowers in the third quarter of 2007, including loan modifications, repayment plans, deed in lieu transactions and short sales. More importantly, however, it examines the extent of these other circumstances so as to put the degree of assistance to borrowers into some sort of context. It looks at the number of foreclosures attributable to borrowers who do not occupy the properties, bor- rowers who cannot be located or won’t respond to lenders and borrowers who have already failed a previous repayment plan. It finds that, during the third quarter the approximately 54 thousand loan modifications done and 183 thousand repayment plans put into place exceeded the number of foreclosures started, excluding those cases where the borrower was an investor/speculator, where the borrower could not be located or would not respond to mortgage servicers, and when the borrower failed to perform under a plan or modifica- tion already in place.

An Examination of Mortgage Foreclosures, Modifications, Repayment Plans and Other Loss Mitigation Activities in the Third Quarter of 2007

The grim toll that the U.S. mortgage crisis has taken on financial markets has been felt worldwide, from traders in Hong Kong to small-town mayors in Europe to pensioners in the American Midwest.

But largely spared have been financiers on Wall Street, a place where brokers, bankers and traders are called into corner offices at the end of each year and told how large a bonus they’ll receive for the year’s work. The size of the figure reflects their value to the company, and many feared — even complained out loud — that the amount would be badly affected by the subprime mess.

They needn’t have worried. Wall Street bonuses totaled $33.2 billion in 2007, down just 2 percent, by the estimates of the New York state comptroller’s office.

The Bonuses Keep Coming: Year-End Payouts Dipped Only Slightly on Wall St.

Even as thousands of people were losing their homes in the subprime mortgage lending mess that many economists say set off instability in the US and world financial markets, the mortgage lending industry spent generously in Washington on federal lobbying and campaign contributions and fended off attempts at regulation and oversight, a Common Cause study shows.

The report shows that even as record numbers of people began home foreclosure proceedings after receiving mortgages they could not afford, the mortgage lending industry spent nearly $32 million in 2007 lobbying the federal government and donating to Members of Congress and the national political parties. That came on the heels of $187 million the industry spent lobbying in Washington from 1999 to 2006, and likely contributed to Congress’ hands off approach to oversight or regulation, even as consumer advocates predicted problems with subprime lending.

While campaign donations favored Republicans prior to 2007, mortgage industry donations moved toward Democrats once they took control in 2006. The industry contributed $1.23 million to Democrats and $1.21 million to Republicans from January to June 2007.

Mortgage industry spent generously in Washington, even as subprime lending mess heated up

Health care costs in the United States have grown substantially for decades and are expected to continue to grow in the future. For the federal government, rising health care costs constitute the principal challenge of fiscal policy–no other single factor will exert more influence over the long-term balance of the federal budget. The effects of rising health care costs are not limited to public programs, however. Private payers have experienced similar growth in costs.

This Congressional Budget Office (CBO) paper–written at the request of the Chairman of the Senate Committee on the Budget–describes the historical growth in spending on health care in the United States. It examines the factors that determine health care spending and how they have contributed to spending growth over time. Special emphasis is given to the largest single factor driving spending growth–the greatly expanded capabilities of medicine brought about by technological advances in medical science over the past several decades. Finally, the paper discusses the implications of continued technological change for future growth of health care spending.

Technological Change and the Growth of Health Care Spending

Perhaps more useful than snark ...

This week the President gave his annual State of the Union address to the Congress. On Monday he will send Congress his 2009 Budget Request.

Below is a chart comparing what he said in his State of the Union address with what he did last year in his 2008 Budget request.

Fact Check: The President, the State of the Union, & Appropriations

Three independent reports have concluded this month that a major new effort is needed to succeed in Afghanistan. These reports - by the Afghanistan Study Group, established by the Center for the Study of the Presidency following the Iraq Study Group; the Strategic Advisors Group of the Atlantic Council of the United States; and a paper written by Dr. Harlan Ullman and others - concur that without prompt actions by the U.S. and its allies, the mission in Afghanistan may fail - causing severe consequences to U.S. strategic interests worldwide, including the war on terrorism and the future of NATO. The U.S. cannot afford to let Afghanistan continue to be the neglected, or forgotten, war.

Afghanistan Study Group Final Report, January 30, 2008

U.S. national security space policy is best characterized by continuity across many years and Presidential administrations. Continuity includes the U.S. commitment to basic principles first advanced by the United States at the outset of the Space Age, including our support for the Outer Space Treaty and other elements of international law, which we believe provide the legal authority to respond to the emerging challenges of the Twenty-First Century.

Although the United States is determined to keep sufficient flexibility for its national security interests, we also recognize that some emerging external challenges require new forms of international cooperation with allies, friends and other responsible spacefaring nations to protect the free access to, and operations through, space.

The State of Space Security

Think of Blue Cities.

Urban proximity can reduce the costs of shipping goods and speed the flow of ideas. Improvements in communication technology might erode these advantages and allow people and firms to decentralize. However, improvements in transportation and communication technology can also increase the returns to new ideas, by allowing those ideas to be used throughout the world. This paper presents a model that illustrates these two rival effects that technological progress can have on cities. We then present some evidence suggesting that the model can help us to understand why the past thirty-five years have been kind to idea-producing places, like New York and Boston, and devastating to goods-producing cities, like Cleveland and Detroit.

Did the Death of Distance Hurt Detroit and Help New York?

The economic approach to cities relies on a spatial equilibrium for workers, employers and builders. The worker’s equilibrium implies that positive attributes in one location, like access to downtown or high wages, are offset by negative attributes, like high housing prices. The employer’s equilibrium requires that high wages be offset by a high level of productivity, perhaps due to easy access to customers or suppliers. The search for the sources of productivity differences that can justify high wages is the basis for the study of agglomeration economies which has been a significant branch of urban economics in the past 20 years. The builder’s equilibrium condition pushes us to understand the causes of supply differences across space that can explain why some places have abundant construction and low prices while others have little construction and high prices. Since the economic theory of cities emphasizes a search for exogenous causes of endogenous outcomes like local wages, housing prices and city growth, it is unsurprising that the economic empirics on cities have increasingly focused on the quest for exogenous sources of variation. The economic approach to urban policy emphasizes the need to focus on people, rather than places, as the ultimate objects of policy concern and the need for policy to anticipate the mobility of people and firms.

The Economic Approach to Cities