UBS and Citi continue the parade of writeoffs and writedowns, their profits disappear, and their senior managers find themselves in danger of losing their jobs

A new prime lender might make more sense in this time of turmoil, but new enterprises of any kind are things this economic environment needs. Fortress Financial Group, Inc is assembling a subprime consumer products group and set to acquire a large mortgage lending operation, according to Mo rtgageDaily.com.

February home sales were up 2.9% over January, the first increase since last July, up to an annual rate of 5.03 million. Of course, median prices had to plunge to make it happen, all the way down to $195,900.

OFHEO is working fast to get Fannie and Freddie in position to increase their capital so the pace of mortgage lending can pick up. HUD is trying to figure out how to get more borrowers to qualify for FHA loans even though their present mortgages are in distress. Regulators and Congress seem to believe this to be a critical moment.

The weekend demise of Bear Stearns, heavily into real estate exposures of several kinds, will not provide confidence. This smallest of the major investment banking houses is now owned by J.P. Morgan Chase.

The major title insurers typically ignore media criticism, regulatory discipline, even class-action litigation. viewing them as costs of doing business that will fade from attention. But the subprime meltdown will result in widespread change in all aspects of the real estate community. Given the title industry's negative public image at this time, how can it expect to escape attention.? See the Condell Private Letter of March 25, 2008.

Reports say NY AG Cuomo has wrung from Fannie Mae and Freddie Mac an agreement under which originating lenders whose loans they buy shall not be able to influence the selection of appraisers. The details of the understanding are not yet clear.

CEO Parker Kennedy of First American calls the NY anti-trust suit an attack on the title industry and promises the four big insurer-defendants will vigorously defend themselves.

Hurt by razor-thin premium splits and large increases in agent-caused title claims, First American Corporation told security analysts on February 28 it intends to become stricter with its independent agents. It has cancelled one very large title agency, says COO Dennis Gilmore, and will review all its others with the expectation of canceling more. The Condell Private Letter will discuss this move, its broader implications, and how it could play into the hands of competitors CPL No 185 is due out March 25.

Only when the media begin reporting savvy investors snapping up what they view as bargains will there be any sign this meltdown has hit bottom. The bargains could be in stocks, bonds, houses, vacant land, or almost anything else. Best of all as a recovery sign might be snap-ups in mortgage-backed securities -- the commodity whose value has most confounded the market during this difficult time. From the outset, a sense of uncertainty about their value -- and how to value them -- seemed to trouble the entire system. Experts say only when the downturn has hit bottom can any kind of recovery become possible.

In Another Blow to the Industry a New York Anti-Trust Class Action Against Four Top Underwriters Claims Rate-Making in the State Is Dysfunctional, Cheats Consumers

A New York law firm has filed suit in federal court in New York, which claims the top four title insurers (First American, Fidelity National, LandAmerica, and Stewart Title) collude in setting rates in that state. Furthermore, the suit alleges, the state admits not being able to understand how agent commissions are computed, making rate making of title insurance there and in other states nothing more than a joke. Consumers are thereby cheated out of hundreds of millions, according to the plaintiffs.

For a discussion of the possible long term and global consequences of this case, see the Condell Private Letter of March 1, 2008. View the complaint