Tuesday Morning: New Century’s Enron Connection; Down in the Valley

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Good morning. Magic profits! The New York Times reports that New Century Financial, back in its pre-bankruptcy days, was using a little-known accounting technique that allowed the company to report profits before they actually existed. Known as ‘gain on sale’, this technique was used most infamously by Enron... but also, the Times reports, by sub-prime lenders NovaStar Financial, Fieldstone Investment, Fremont General. Up in the Valley, The Daily News reports that median home prices have suffered their first annual decline in ten years: ‘In the January-to-March period, sales of previously owned houses fell 13.1 percent to 1,865 transactions, and the median price dipped $1,000 to $606,000.’ No, the home pictured is not in the Valley. That’s a ‘Real Home of Genius,’ highlighted by Dr. Housing Bubble, who finds overpriced, undersized gems to make his point: ‘Real Homes of Genius: Today We Salute you Inglewood. For $329,000 you get 550 square feet and Garbage on the Lawn.’ Comments? Insights? Comments are always welcome. If they are not suited for a family blog I edit them. Email story tips to laland@yahoo.com.