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So how does this principle apply to banks?

Let's say we decide to start a bank . . . call it XYZ Bank. We raise $2 Million to

open our doors. Remember that our capital account is $2 Million. Banks

make money by taking in deposits and paying low rates of interest to those depositors (maybe throw in a toaster too). We then take that money and make loans with it at higher rates. We keep the difference.

So, we turn the $2 Million worth of… Continue

The 'Mark to Market' Accounting Rule:

What it is and why it is important to you now!



The financial crisis we are in today was not caused by mortgages or housing, although they were both catalysts. The real reason was an accounting rule called "Mark to Market" (also known as FASB 157).

Few people have a strong grasp of this rule, and even those who do have a tough time explaining it on air due to time restrictions. So let's take a few minutes to break it down, so you can… Continue

Team,



Here are the important parts of the H.R. 3221, the Housing and Economic Recovery Act of 2008. It is important that we, as industry experts know the high points so we can communicate with our clients.





All-Originator Registry: Establishes a nationwide loan originator licensing and registration system that will set minimum standards for loan originator licensing substantially improving the oversight of all originators. In addition, all loan originators - lenders,… Continue

Solar Power is becoming more affordable, while natural gas and coal prices are rising. With the gap closing solar is edging closer to being cost competitive. The cost of solar cell made power will fall 25% this year and in 10 years the cost will fall another 50%. This will bring the cost down to 12 to 15 cents per kilowatt-hour. The cost to produce a kWh using coal and natural gas is now at 11 cents and climbing.



What is driving the costs? Technological breakthroughs are driving the… Continue

The FOMC left the Fed Funds rate unchanged at 2.0%. The economy, in the most recent numbers has modestly expanded and these numbers are backed up by household spending firming. The rise in energy prices, housing conditions, is likely to weigh on economic growth over the next few quarters.



The inflation outlook for inflation remains high with continued upward pressure on energy and commodities prices. The FOMC, however, does expect inflation to moderate later this… Continue