Economy Watch: California Targets Mortgage Fraud, Rooftop Solar, Chicago Fed Index
By Dees Stribling, Contributing Editor
The state of California has created a 25-member mortgage fraud task force, the aim of which is to investigate all variety of shady mortgages, including garden-variety mortgage criminals preying on individuals as well as more sophisticated mortgage originators who might have sold shoddy goods (tied in nice, neat bows) to mortgage investors during the heyday of the housing bubble. The members include 17 lawyers and eight special agents from the California Department of Justice.
The task force was created by the California Attorney General’s office. Though it might seem like locking the barn door after the horse is stolen, AG Kamala Harris isn’t new to this kind of thing. As District Attorney of San Francisco in 2009, she launched the first standalone district attorney’s mortgage fraud unit in California with $1.1 million from the U.S. Department of Justice.
Naturally, Harris isn’t the only state AG looking under rocks in the mortgage industry, hoping to catch mortgage cons and perhaps score points with the electorate as well. New York AG Eric Schneiderman recently issued subpoenas to bond-insurance companies in his quest to look into mortgage-securitization shenanigans.
Toy Retailer Supersizes Rooftop Solar Installation
Where is the largest solar rooftop installation in the country going to be, once it’s finished this summer? Not at a federal installation, nor some demonstration project in California. In fact, it will be at a Toys ‘R Us Inc. distribution center in Flanders, N.J.
Upon completion, the 5.38-megawatt on-site solar installation will occupy about 869,300 square feet–or roughly 70 percent–of the roof. If all goes well, it will generate 72 percent of the electrical needs for the facility. In an ownership arrangement that might become more common as CRE continues to green, Toys ‘R Us will not own the installation. Rather, Constellation Energy will build, own and maintain it, while Toys ‘R Us will purchase electricity generated by the system through a 20-year power purchase agreement with the energy company.
Constellation estimates that depending on weather conditions, the system is expected to produce approximately 6.362 million kilowatt hours of electricity each year. Generating the same amount of electricity using non-renewable sources would release about 4,380 metric tons of carbon dioxide, and represents enough electricity to power 532 homes for a year. The company-owned fulfillment center opened in 1995 and was expanded in 2001, and in the years since then the rooftop has been doing exactly nothing except keeping out the weather.
Chicago Fed National Activity Index Drops
The Chicago Fed National Activity Index took a dive between March and April, from 0.32 to negative 0.45, its lowest level since last August. Three of the four broad categories that form the index sagged month over month. Production-related components in particular were off, such as manufacturing, down for the first time in nine months, some of which was attributable to parts shortages in Japan affecting production in the United States.
So the economy, on the whole, is now a little more glum. But according to the Chicago Fed, the index at least “suggests subdued inflationary pressure from economic activity over the coming year.”
Wall Street was a little glum on Monday, too. The Dow Jones Industrial Average lost 130.78 points, or 1.05 percent. The S&P 500 saw 1.19 percent of its value shaved off, while the Nasdaq was down 1.58 percent.