two little factoids

one, two, three little injuns . . .
how about two factoids?
in the B of A earnings release some Ken Lewis minion mentioned that mortgage loans out of Socal were at 65% loan to value. You want to borrow money from Bank of America to buy a house in a Southern California neighborhood? Not a problem. The bank expects a 20% down payment. Oh, wait a minute, that doesn't mean you can borrow 80% of what the property is worth today. You can borrow 80% of what their model says it will be worth next year. Factor in a 20% decline in real estate values, and, well, we'll lend you 80% of 80%, or, in the interest of customer good will, 65%.
Ouch, and good luck Hank Paulson.
Double ouch. A high end real estate agent in Manhattan reported in the blogosphere as commenting that the better stuff was down a quarter since the middle of summer. Nobody is buying . . .
not sure exactly what the better stuff is, but I imagine its the kind of property that would interest somebody who's gotten a seven figure bonus more than once.