The End of Non-Bank Lenders
Here is an article on more trouble at mortgage companies from Reuters via Yahoo Finance. I link to it only because it has become clear (to me) that the non-bank mortgage companies are doomed. The big banks don't like the competition and flexibility these firms offer and the financial system's problems are now concentrated in these non-bank mortgage companies. The Fed's cut in the discount rate only benefited big banks as these are only firms that can borrow from the Fed's Discount Window. Many of the big bank's financial problems originate in the mortgages made by the non-bank mortgage companies that the big banks bought, packaged and syndicated. Don't expect any institution to throw these non-bank firms a life-line, unless it's in the form of a fire-sale buyout offer.