Financial thoughts

Today’s record-low mortgage rates are out of reach for millions of U.S. homeowners who would benefit from them most.

One in four homeowners with a mortgage _ 11 million people _ owe more than their home is worth. These “underwater” borrowers have virtually no shot at refinancing.

Their plight is a drag on the housing market and the broader economy.

The Obama administration is hoping at least 1 million of these borrowers will take advantage of its refinancing program under more lenient rules unveiled Monday. Homeowners who are current on their payments will be eligible to refinance no matter how much their home’s value has dropped.

Still, it’s unclear how many borrowers will benefit. Lenders will remain under no obligation to refinance a mortgage they hold.

A growing number of these people are missing mortgage payments and falling into foreclosure. And the higher rates they’re locked into limit how much they can contribute to a weak economy. If they were able to refinance at today’s rates, it could boost consumer spending by tens of billions of dollars, economists say.

Underwater homeowners are paying an average 30-year fixed mortgage rate of 5.7 percent, according to an analysis of mortgage data by CoreLogic and The Associated Press. That compares with today’s average rate of 4.11 percent on a 30-year fixed mortgage. For a homeowner with a $250,000 mortgage, the lower rate would save more than $200 a month.

For many Americans, a few hundred dollars each month would mean the difference between paying their mortgage on time and in full and losing, or walking away from, their home guaranteed online payday loans.

Underwater borrowers are the “most desperate population in the country today,” says Barry Bosworth, an economist at the Brookings Institution.

Dan and Maggie Micoff bought a two-bedroom home in the Detroit suburb of Marine City in 2003. They paid $119,000. Eight years later, they’re underwater with a 6 percent loan.

If they could refinance, the Micoffs, both 58, could shave at least $120 from their monthly bill.

“The banks won’t work with us,” Maggie Micoff said. “We helped bail them out, and now we can’t even get a personal loan to get by. We could rent something for a few hundred dollars cheaper.”

Even among homeowners who do have equity in their homes, few are refinancing. Many have already refinanced within the past year. Others can’t meet tighter lending standards. That’s why underwater borrowers represent the best chance for refinancing to unleash spending that’s otherwise going toward mortgage bills.

With millions locked into artificially high rates, foreclosures are rising. Mortgage default notices surged nationally last month.

Whether the administration’s revamped mortgage refinancing program will reach more Americans this time is unclear, said Mark Vitner, senior U.S. economist at Wells Fargo.

“No one knows if it will spur a lot more people to refinance, but it’s a start,” Vitner said.

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NATO said Friday it plans to end its seven-month bombing campaign in Libya at the end of the month, leaving the battled-scarred country’s new authorities on their own to ensure security after the death of Moammar Gadhafi and the ouster of his regime.

The alliance made a preliminary decision to end the campaign on Oct. 31 and will make the formal decision next week, Secretary General Anders Fogh Rasmussen said after a meeting of the alliance’s governing body, the North Atlantic Council.

Diplomats said NATO air patrols are set to continue over Libya in the next 10 days as a precautionary measure to ensure the stability of the new regime. They will gradually be reduced in coming days if there are no further outbreaks of violence.

The council took into account the wishes of Libya’s new government and of the United Nations, under whose mandate NATO carried out its operations.

Victory in the war represents a major boost for the Cold War alliance, which is bogged down in the 10-year war in Afghanistan, the 12-year mission in Kosovo, and the seemingly never-ending anti-piracy operation off the Somali coastline.

It polished the reputation of France and Britain, the two countries that drove it forward, coming at a time when the alliance’s relevance is increasingly in doubt as countries make deep defense cuts and other austerity measures caused by the international economic crisis.

Rasmussen hailed the success of the operation which started on March 19 with a series of U.S.-led attacks designed to suppress Gadhafi’s formidable air defenses, including missile and radar networks. Libya’s former rebels killed Gadhafi on Thursday, and officials had said they expected the aerial operation to end very soon.

“It shows that freedom is the biggest force in the world,” Fogh Rasmussen said.

Fogh Rasmussen said NATO had no intention of leaving any residual force in or near Libya.

“We expect to close down the operation.”

He said it was up to the new government to decide whether to launch an investigation into the hazy circumstances of Gadhafi’s death.

“With regards to Gadhafi, I would expect the new authorities in Libya to live up fully to the basic principles of rule of law and human rights, including full transparency.”

NATO earlier said its commanders were not aware that Gadhafi was in a convoy that NATO bombed as it fled Sirte short term personal loans. In a statement Friday, the alliance said an initial Thursday morning strike was aimed at a convoy of approximately 75 armed vehicles leaving Sirte, the Libyan city defended by Gadhafi loyalists. One vehicle was destroyed, which resulted in the convoy’s dispersal.

Another jet then engaged approximately 20 vehicles that were driving at great speed toward the south, destroying or damaging about 10 of them.

“We later learned from open sources and allied intelligence that Gadhafi was in the convoy and that the strike likely contributed to his capture,” the statement said.

Intelligence gleaned during surveillance flights around Sirte on Thursday indicated that a “command and control group, including senior military leaders” were attempting to flee from the town, British Prime Minister David Cameron’s spokesman Steve Field said.

“There was a strike, there was damage to the convoy, the Free Libya Fighters then moved in _ as to what happened next that is not entirely clear,” he said.

NATO warplanes have flown about 26,000 sorties, including over 9,600 strike missions. They destroyed about 5,900 military targets, including Libya’s air defenses and over 1,000 tanks, vehicles and guns, as well as Gadhafi’s command and control networks.

The daily airstrikes finally broke the stalemate that developed after Gadhafi’s initial attempts failed to crush the rebellion that broke out in February. In August, the rebels began advancing on Tripoli, with the NATO warplanes providing close air support and destroying any attempts by the defenders to block them.

NATO was sharply criticized by Russia, China, South Africa and other nations for overstepping the limited U.N. Security Council resolution that allowed it to protect civilians, and using it as a pretext to pursue regime change in Libya.

French President Nicolas Sarkozy said earlier Friday that “the operation has reached its end.”

But in London, Britain had suggested that NATO may not immediately complete its mission in Libya, wary over the potential reprisal attacks by remaining Gadhafi loyalists.

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Associated Press writers Elaine Ganley in Paris and David Stringer in London contributed to this report.

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The city that put Love Canal and Superfund in the environmental lexicon may get back into the business of dealing with toxic waste _ this time willingly. It is considering whether to truck in and treat wastewater left over from natural gas drilling.

The economically struggling city in western New York could use the revenue, and the Niagara Falls Water Board says its specialized wastewater treatment plant can handle more business since the decline of the chemical industry it was designed for.

With New York considering allowing natural gas production in its part of the lucrative Marcellus Shale, the water board is examining whether it would make economic sense to become a destination for the byproduct wastewater of the drilling process, called hydraulic fracturing, said Richard Roll, the public benefit corporation’s director of technical and regulatory services.

“Since we do have a unique kind of wastewater treatment plant that’s very much under-loaded, we’re looking into the possibility that, with the addition of other treatment processes, maybe our plant would be much more amenable to accepting this waste than your typical municipal biological plant,” he said.

Many have criticized the idea, including former Love Canal resident Lois Gibbs, who became a national voice for environmental health. She said she wondered if city officials would ever learn.

“They’re moving away from the chemical industry because the chemical industry is moving away from them, and it’s time to start a new economy,” Gibbs said by phone Thursday from Falls Church, Va., where she’s executive director of the Center for Health, Environment & Justice. “And the new economy is certainly not taking chemical waste.”

Fracking forces millions of gallons of water, mixed with sand and chemicals, deep into shale formations beneath Pennsylvania, New York, Ohio, West Virginia, Texas and other states. Its use has increased dramatically in recent years, raising concerns about the potential impact on water quality. Critics say fracking could poison water supplies, while the natural gas industry says it’s been used safely for decades.

Liquid that comes out of the drilling wells is highly salty and contaminated with substances such as barium, strontium and radium and other things that can be damaging to the environment. Millions of barrels of wastewater must be treated, and municipal sewage treatment plants can’t remove contaminants as efficiently as some of the treatment facilities that specialize in oil and gas industry waste.

The Environmental Protection Agency announced Thursday that it will draft standards for wastewater that drillers would have to meet before sending it to treatment plants.

In Niagara Falls, environmental groups and others say importing chemical-laden waste should be the last thing Niagara Falls should consider, given its experience with the Love Canal environmental disaster. An entire neighborhood was emptied in the 1970s after toxins dumped by Hooker Chemicals and Plastics Corp. into an abandoned canal in the 1940s and ’50s were found to have seeped into basements and backyards, creating panic over birth defects and cancer no teletrack payday loans. President Jimmy Carter declared a federal emergency in 1978, and in 1980 the Superfund cleanup act was born.

Once treated, the fracking wastewater, to be brought in by truck or rail, would either be discharged into the Niagara River upstream of Niagara Falls or be reused in drilling, Roll said. The Niagara River flows between lakes Erie and Ontario, forming a border between western New York and Ontario, Canada.

A coalition of local opponents submitted 25 questions to the water board, and about 15 members attended a board meeting Thursday night hoping for answers about the potential environmental impacts to the river and adjoining lakes, costs, safety, possible impacts on human health and the handling of radiation brought to the surface from deep shale wells.

“We should be learning from past mistakes instead of risking our water so we can accept New York state’s hydrofracking waste,” said Rita Yelda, an organizer for Food & Water Watch, an environmental advocacy group.

“Niagara Falls is known for its tourism, its beautiful scenery,” Yelda said. “A large part of their revenue is tourism, people coming in to see Niagara Falls. How will that be impacted by the increased truck traffic and what they’re releasing into Niagara Falls?”

The Council on Canadians, a social justice advocacy group, also is among those pushing Niagara Falls to scrap the idea.

“Last year the (United Nations) passed two resolutions recognizing water as a human right, and this proposal to treat fracking fluids threatens people’s human right to safe and clean drinking water,” the Ottawa-based group said in a Sept. 22 letter to the water board.

The board took no action Thursday.

Earlier in the day, Roll stressed the board is only just beginning to research feasibility testing, regulatory requirements and potential revenue “to make sure it’s not just workable but it makes sense for everyone to participate.”

The Niagara Falls treatment plant was designed to handle waste from the city’s once booming industrial base of electrochemical, organic chemical, ceramics and electrometallurgical plants, Roll said. It already processes imported landfill leachate from three customers that bring the waste by truck, he said.

“We’ve been developing that trade for the past 15 years or so, and that has had the same effect,” he said. “It’s unused capacity that is sitting there waiting to be taken advantage of, and we have a duty to try to make our utility as economically viable as possible for everyone.”

New York environmental regulators last month formally issued proposed regulations for hydraulic fracturing in the Marcellus Shale and scheduled four public hearings. The state hasn’t allowed fracking since it began drafting new permitting rules three years ago.

In neighboring Pennsylvania, nearly 4,000 wells have been drilled in the past few years and tens of thousands more are planned.

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Orders are now being taken for the Kobo Vox, a full-colour seven-inch tablet the same size as the BlackBerry PlayBook.

TORONTO — The Canadian ebook company Kobo is getting into the crowded tablet market and beating a major competitor to the punch.

Orders are now being taken for the Kobo Vox, a full-colour seven-inch tablet the same size as the BlackBerry PlayBook.

It’s selling for about $200 and shipping starts on Oct. 28.

It’s a Wi-Fi only device, runs on the Google Android operating system and has eight gigabytes of memory. Kobo says it has up to seven hours of battery life.

The Vox will compete against a long list of tablets on the market, including Apple’s bestselling iPads, the PlayBook, Samsung’s Galaxy Tabs, Motorola’s Xoom and a host of smaller rivals online payday loans. But the Vox is about 40 per cent cheaper than the most-inexpensive iPad.

Kobo’s largest ebook competitor, Amazon, also announced its own tablet recently with similar specifications.

Called the Fire, it’s not due for release until Nov. 15 and is also selling for $199 in the U.S. There’s no release date set for Canada.

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Forecasters say Tropical Storm Ophelia has weakened further and its strongest winds are expected to remain offshore as it races toward the Avalon Peninsula of Newfoundland, Canada.

The National Hurricane Center in Miami said early Monday that Ophelia’s top sustained winds weakened to about 60 mph (95 kph). The storm was moving northeast at 35 mph (56 kph).

Ophelia was centered about 65 miles (100 kilometers) west-northwest of Cape Race, Newfoundland, and a tropical storm watch was in effect for Newfoundland’s Avalon Peninsula easy payday loans. The center says Ophelia is expected to continue to weaken, but still pack powerful winds.

Meanwhile, Tropical Storm Philippe was moving over the central Atlantic and is not expected to affect land.

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Last week, the government tabled Bill C-11, the latest attempt to reform Canadian copyright law. The bill mirrors its previous copyright bill and is expected to sail through the House of Commons with committee hearings that will pick up where they left off in March.

When Bill C-32 was introduced in June 2010, many noted that there was a lot to like in the bill, but that the digital lock provisions, which give locks on DVDs, CDs, and electronic books enhanced legal protections, constituted a glaring problem that undermined much of the attempt to strike a balance.

The effect of the rules is that consumer rights found in the bill are lost when the copyright owner installs a digital lock that can restrict access.

Consumers purchasing DVDs from foreign countries may find they will not play on Canadian DVD players and students may be restricted from copying portions of their electronic books for class assignments.

In trying to understand the government

Fannie Mae missed chances to catch law firms illegally signing foreclosure documents and its government overseer did not take the right steps to ensure Fannie was doing its job, federal regulators say.

The Federal Housing Finance Agency’s inspector general said in a report Friday that Fannie failed to establish an “acceptable and effective” way to monitor foreclosure proceedings between 2006 and early 2011. Government regulators then failed to ensure it was complying with demands that it clean up its programs.

Mortgage industry employees _ including law firms employed by Fannie Mae _ signed documents they hadn’t read and used fake signatures on foreclosure cases across the country. The practices, known collectively as “robo-signing,” resulted in a suspension of foreclosures last fall and a probe by all 50 state attorneys general into how corners were cut to keep pace with the crush of foreclosure paperwork.

In 2005, Fannie hired outside investigators to look into allegations about faulty foreclosure documents. A year later, Fannie received a report from the investigators that found law firms working for Fannie had filed false documents.

Fannie said it was developing a computer system to improve communication and monitor its attorneys but regulators said they found no evidence Fannie had made any improvements in overseeing its attorneys.

FHFA was created in 2008 to oversee mortgage buyers Fannie Mae and Freddie Mac. To make sure Fannie was doing its job, FHFA has the authority to fire and replace employees; issue cease and desist orders; and impose fines. To date, the agency has not taken any of those actions, the inspector general’s report said.

Fannie and Freddie own or guarantee about half of all U.S. mortgages, or nearly 31 million home loans worth more than $5 trillion. As part of a nationalized system, they account for nearly all new mortgage loans. So anyone looking to buy a home would be forced to pay higher rates on new loans.

The Bush administration seized control of the mortgage giants in September 2008, hoping to stabilize the beleaguered housing industry.

In a separate report released Friday, the inspector general says the FHFA lacks examiners to monitor Fannie. Just a third of its 120 non-executive examiners are federally accredited, the report found. Other federal regulators, such as the Federal Deposit Insurance Corp., usually require all of their examiners to be accredited.

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Nature is pummeling the United States this year with extremes.

Unprecedented triple-digit heat and devastating drought. Deadly tornadoes leveling towns. Massive rivers overflowing. A billion-dollar blizzard. And now, unusual hurricane-caused flooding in Vermont.

If what’s falling from the sky isn’t enough, the ground shook in places that normally seem stable: Colorado and the entire East Coast. On Friday, a strong quake triggered brief tsunami warnings in Alaska. Arizona and New Mexico have broken records for wildfires.

Total weather losses top $35 billion, and that’s not counting Hurricane Irene, according to the National Oceanic Atmospheric Administration. There have been more than 700 U.S. disaster and weather deaths, most from the tornado outbreaks this spring.

Last year, the world seemed to go wild with natural disasters in the deadliest year in a generation. But 2010 was bad globally, and the United States mostly was spared.

This year, while there have been devastating events elsewhere, such as the earthquake and tsunami in Japan, Australia’s flooding and a drought in Africa, it’s our turn to get smacked. Repeatedly.

“I’m hoping for a break. I’m tired of working this hard. This is ridiculous,” said Jeff Masters, a meteorologist who runs Weather Underground, a meteorology service that tracks strange and extreme weather. “I’m not used to seeing all these extremes all at once in one year.”

The U.S. has had a record 10 weather catastrophes costing more than a billion dollars: five separate tornado outbreaks, two different major river floods in the Upper Midwest and the Mississippi River, drought in the Southwest and a blizzard that crippled the Midwest and Northeast, and Irene.

What’s happening, say experts, is mostly random chance or bad luck. But there is something more to it, many of them say. Man-made global warming is increasing the odds of getting a bad roll of the dice.

Sometimes the luck seemed downright freakish.

The East Coast got a double-whammy in one week with a magnitude 5.8 earthquake followed by a drenching from Irene. If one place felt more besieged than others, it was tiny Mineral, Va., the epicenter of the quake, where Louisa County Fire Lt. Floyd Richard stared at the darkening sky before Irene and said, “What did WE do to Mother Nature to come through here like this.”

There are still four months to go, including September, the busiest month of the hurricane season. The Gulf Coast expected a soaking this weekend from Tropical Storm Lee and forecasters were watching Hurricane Katia slogging west in the Atlantic.

The insurance company Munich Re calculated that in the first six months of the year there have been 98 natural disasters in the United States, about double the average of the 1990s.

Even before Irene, the Federal Emergency Management Agency was on pace to obliterate the record for declared disasters issued by state, reflecting both the geographic breadth and frequency of America’s problem-plagued year.

“If you weren’t in a drought, you were drowning is what it came down to,” Masters said.

Add to that, oppressive and unrelenting heat. Tens of thousands of daily weather records have been broken or tied and nearly 1,000 all-time records set, with most of them heat or rain related:

_ Oklahoma set a record for hottest month ever in any state with July.

_ Fairbanks, Alaska, hit 97 degrees on July 11, a record.

_ Houston had a record string of 24 days in August with the thermometer over 100 degrees faxless pay day loans.

_ Newark, N.J., set a record with 108 degrees, topping the old mark by 3 degrees.

Tornadoes this year hit medium-sized cities such as Joplin, Mo., and Tuscaloosa, Ala. The outbreaks affected 21 states, including unusual deadly twisters in Minnesota, Wisconsin and Massachusetts.

“I think this year has really been extraordinary in terms of natural catastrophes,” said Andreas Schrast, head of catastrophic perils for Swiss Re, another big insurer.

One of the most noticeable and troubling weather extremes was the record-high nighttime temperatures, said Tom Karl, director of NOAA’s National Climatic Data Center. That shows that the country wasn’t cooling off at all at night, which both the human body and crops need.

“These events are abnormal,” Karl said. “But it’s part of an ongoing trend we’ve seen since 1980.”

Individual weather disasters so far can’t be directly attributed to global warming, but it is a factor in the magnitude and the string of many of the extremes, Karl and other climate scientists say.

While the hurricanes and tornado outbreaks don’t seem to have any clear climate change connection, the heat wave and drought do, said NASA climate scientist Gavin Schmidt.

This year, there’s been a Pacific Ocean climate phenomenon that changes weather patterns worldwide known as La Nina, the flip side to El Nino. La Ninas normally trigger certain extremes such as flooding in Australia and drought in Texas. But global warming has taken those events and amplified them from bad to record levels, said climate scientist Jerry Meehl at the National Center for Atmospheric Research.

Judith Curry of Georgia Tech disagreed, saying that while humans are changing the climate, these extremes have happened before, pointing to the 1950s.

“Sometimes it seems as if we have weather amnesia,” she said.

Another factor is that people are building bigger homes and living in more vulnerable places such as coastal regions, said Swiss Re’s Schrast. Worldwide insured losses from disasters in the first three months this year are more than any entire year on record except for 2005, when Hurricane Katrina struck, Schrast said.

Unlike last year, when many of the disasters were in poor countries such as Haiti and Pakistan, this year’s catastrophes have struck richer areas, including Australia, Japan and the United States.

The problem is so big that insurers, emergency managers, public officials and academics from around the world are gathering Wednesday in Washington for a special three-day National Academy of Sciences summit to figure out how to better understand and manage extreme events.

The idea is that these events keep happening, and with global warming they should occur more often, so society has to learn to adapt, said former astronaut Kathryn Sullivan, NOAA’s deputy chief.

Sullivan, a scientist, said launching into space gave her a unique perspective on Earth’s “extraordinary scale and power and both extraordinary elegance and finesse.”

“We are part of it. We do affect it,” Sullivan said. “But it surely affects us on a daily basis _ sometimes with very powerful punches.”

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Researcher Julie Reed Bell contributed to this report.

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