Restore TARP to Its First Purpose – Peter Ackerman and John Vogelstein – … The market wants to understand the dimensions of the losses that banks face from their mortgage holdings. We believe that using a significant portion of TARP’s remaining assets for its original purpose — buying distressed mortgage assets — is the fastest and most reliable way to achieve that.  … – Washington Post

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1.  Annual Decline in US Home Prices Accelerates -  So much for the slowing rate of decline in US home sales prices over the past few months: the pace of decline in the S&P/Case-Shiller Home Price Indices accelerated in September. The 10-City and 20- City Composites continued to set new records, with annual declines of 18.6% and 17.4%, respectively.  Looking at the returns of the U.S. National Index, prices are back to where they were in early 2004. – Research Recap

2.  Record Decline For Home Prices – Eric Rosenbaum – The S&P/Case-Shiller U.S. National Home Price Index suffered a record annual decline of 16.6% through the third quarter, as compared with the same time period 2007. The third-quarter numbers continued, to a greater level, the negative trend already in place through the first two quarters of 2008, when annual declines were at 14% and 15.1%, respectively. – more data at Index Universe

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VIDEO: A Conversation with George Soros – MIT.edu

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Fannie Mae’s October portfolio jumps 28 percent – Reuters

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Rogers Says Dollar to Be `Devalued,’ Buys Commodities – By Ron Harui and Mike Schneider – Bloomberg

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great chart – too big for this page – A Visual Guide to the Financial Crisis – by WallStats.com -   thanks Susan Kulakowski -  Blog.Mint.com

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The Not-So-Smart Smart Money – It should be fairly evident by now that heavy redemptions at hedge funds over the past two months contributed significantly to the recent pounding in the one area where markets are liquid – stocks. Moreover, the deleveraging process continues to impact many hedgies as available capital (for leveraged strategies) has dried up*. – Vinny Catalano

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Historical National Debt to GDP - by Toro – I am seeing a lot of hand-wringing in the blogosphere about the amount of debt being put on the US government’s balance sheet.  … Now, let me say, I am not minimizing the enormous problems in the asset markets and the general economy. – Running of the Bulls

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Citi (C) Was Saved, But What About JP Morgan Chase (JPM)? – Market fear reached such a high last week that JP Morgan CEO Jamie Dimon found he could not get on a plane to Saudi Arabia without arousing suspicions that … -   Silicon Alley Insider

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More Option Arm Fun: What Me, Pay? – Paul Kedrosky  – An eye-opening chart on outstanding option ARM loan principal by vintage year. Turns out that when people have an option not to pay, they don’t – and then the principal gets larger. Gosh, this mortgage stuff is tricky. – Infectuous Greed

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intriguing proposal – The Cost of Providing a Housing Price Floor -  Lok Sang Ho – seeking alpha

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Oil Is Cheap. Why Is Gas, Which Is Made From Oil, Even Cheaper? – Catherine Rampell – Crude oil futures recently fell to about $50 a barrel, the cheapest they have been since May 2005. How does this relate to gasoline prices? – Blogs NY Times
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1.  interesting proposal – How John Lee Would Clean Up the Financial Mess and Put $800 billion to Work (Part I) – … Let’s get this right: Countrywide (now Bank of America) lent Bob $1 million for a home that’s worth $200,000. The genius AIG comes in and insures this mortgage and collects a premium from Countrywide.- IBT Commodities

2.  Now that Bob can’t make the credit card and house payment, troubled American Express gets a $20 billion help out, AIG gets a $150 billion bailout from the insurance obligation, and Countrywide gets to sell Bob’s non-paying mortgage to the Fed?  So what does Bob get from this rescue? Nothing. – IBT Commodities

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Uh-Oh … Reverse split in Fannie’s future – Looks like Fannie Mae (FNM) is headed for a reverse stock split. The Washington-based mortgage lender said Wednesday that it told the New York Stock Exchange it intends to push its share price back above $1 for 30 straight days between now and May in a bid to avoid being delisted from the NYSE. Fannie said it’s working with its regulator, the Federal Housing Finance Agency, “to determine the specific action or actions that Fannie Mae will take to cure the deficiency.” – Fortune Daily Briefing

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    IRA ARTMAN SECTION – thanks Ira:

1. The Fairness Issue: How to Cope with the Flood of Foreclosures – Knowledge@Wharton

2.  Jeremy Siegel’s Advice to Banks: Lend That Money Now – Before the stock market and the broader economy can return to something that looks like normal, banks must start to lend the billions they are getting from the U.S. Treasury’s Troubled Asset Recovery Program, says Wharton finance professor Jeremy Siegel. In an interview with Knowledge@Wharton

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What really drives oil prices? In US dollar terms, crude oil prices increased 525% from the end of 2001 through July 31st, 2008. Was this rally yet another speculative bubble? Specifically, was the oil-price rally based on speculative excess rather than fundamental supply-and-demand factors? – EDHEC