Developers Diversified Realty Corporation (DDR), a leading real estate investment trust (REIT), is planning to raise $400 million through Term Asset-backed Securities Loan Facility (TALF program). The TALF was created by the Fed to support the issuance of asset-backed securities (ABS) collateralized by student loans, auto loans, credit card loans and loans guaranteed by the Small Business Administration.  The deal is being eagerly anticipated by the $700 billion market for commercial mortgage backed securities (CMBS), which took a severe beating in 2008 from the economic downturn. With the deal, Developers Diversified would be able to raise significant capital to increase its liquidity. By the end of the third quarter of 2009, the company had over $5 billion of consolidated debt.  Developers Diversified specializes in the acquisition, ownership, development, redevelopment, leasing and management of shopping centers and business centers. The company owns and manages 670 retail operating ...

Fed Chairman Bernanke posed the “existence of an ongoing need” for a lending facility to serve businesses and consumers Friday.

The Term Asset-Backed Securities Loan Facility (TALF), while originally set to expire at the end of this year, will be extended into the next, with a potential to generate $1 trillion for residential and commercial borrowers. The TALF represents the central mechanism of the Fed/Obama administration’s attempts to restore the flow of credit and stabilize the markets.

Citing the demand to further drive down rates on car loans by continuing to employ the TALF mechanisms to bolster the automotive industry and ensure a recovery, Bernanke also reaffirmed his pledge to reach out to minority-owned businesses and see to it that they get a fair shake from these government lending programs.

The program began slowly and continues to show demand below expectations. With $200 billion offered in the first phase, the Fed

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U.S. Federal Reserve Chairman Ben S. Bernanke said yesterday (Tuesday) that the worst recession since the Great Depression is “very likely over.” However, Bernanke also said that unemployment would remain high and keep the recovery from accelerating.

“Even though, from a technical perspective, the recession is very likely over at this point,” Bernanke said, “it’s still going to feel like a very weak economy for some time, as many people still find that their job security and their employment status is not what they wish it was. So that is a challenge for us and all policy-makers going forward.”

The real challenge for Fed policymakers will be to gingerly dismantle all of the programs they set in place to backstop the markets – such as the Commercial Paper Funding Facility – which holds $109.2 billion in short-term IOUs issued by corporations – and the Term Asset-Backed Securities

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Even as investors get more and more bullish about the outlook for the U.S. economy, the economy’s underlying foundation continues to erode.

In a report to be released this week, the Obama administration will boost its 10-year projection for the federal budget deficit to about $9 trillion – an increase of roughly $2 trillion, or 29%, from its prior projection, Fox News reported over the weekend, citing a source from the Office of Management and Budget (OMB).

The new cumulative deficit projection – for 2010-2019 – replaces the administration’s previous estimate of $7.108 trillion. Changes in budget projections – whether they result in a surplus or a deficit – are often refined as economic conditions change. This new projection was necessary because the recession has gone on for so long, causing federal tax receipts to plunge – and because the economic rebound will be prolonged and weak, resulting

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Sellers back in control… China, FDIC, U.S. consumers trigger global sell-off… Chris Mayer examines a disturbing trend among American investors… Signs of the times: Bernanke frets over commercial real estate, Treasury to sell U.S. mortgages to China… Greg Guenthner with a Far East opportunity growing “at an astronomical rate”…

“Investing in this market is like trying to take cheese out of a set mousetrap,” Chris Mayer begins today. “It’s very tempting to make a grab, but you are also fairly certain about what will happen if you do. The market’s 50% rise from its March lows is stunning. It’s like the cheese in the trap. But we also know that no market moves up like that for long. The kill bar is never far from such rallies.”

Check out Asia early this morning… you can almost hear that bar whipping through the air:

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Steel maker Nucor Corp.’s (NYSE: NUE) stock has rallied some 51% from its March 3 low of $29.84 a share and has twice bumped against its recent high of $49.91 a share. 

The stock is still a far cry from its record-high level of $83.56, but is only 0% below its 52-week high of $53.46.  Much has changed since then, as the U.S. auto industry is no longer producing the 16 million cars it produced in 2007, nor the 13 million it managed to sell last year.  This year we are looking at some 10 million units sold, according to J.D. Power and Associates, the leading forecaster in the industry.

But there is encouraging news:  The very quick restructuring of both General Motors Corp. (NYSE: GRM) and Chrysler Group LLC, the U.S. Federal Reserve’s efforts to stabilize the financial markets, and

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This post is a guest contribution by Asha Bangalore* of The Northern Trust Company.

The Fed announced the plan on March 18, 2009 to purchase $300 billion of long-dated Treasury securities over a six-month period. As of July 23, 2009, the Fed has bought $219.7 billion or roughly 73% of the plan. There are mixed opinions within the FOMC about raising the amount of purchases under this plan.

“Some participants thought that increases in purchases of Treasury securities might have little or no effect on long-term interest rates unless the increases were very sizable, given the large amount of current and projected supply of Treasury securities. Others were concerned that announcements of substantial additional purchases could add to perceptions that the federal debt was being monetized. While most members did not see large-scale purchases of Treasury securities as likely to be a source of inflation pressures

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[Editor's Note: If it's inflation you're worried about - and commodities you want to invest in - there's no better place to look than the Global Resource Alert trading service, which ferrets out companies poised to profit from the so-called “Secular Bull Market” in commodities. If you’re new to the commodities-investing arena, and are uncertain about the landscape – or even if you’re an “old hand” at natural-resource stocks, but want some insights into the new profit plays and new players – consider hiring a guide: Money Morning Contributing EditorPeter Krauth, a recognized expert in metals, mining and energy stocks, who is also the editor of the Global Resource Alert. A former portfolio advisor, Krauth continues to work out of resource-rich Canada, which keeps him close to most of the companies he researches. Against the growing global financial malaise, Krauth says that commodities are among …

In my previous post I commented on Ben Bernanke's recent communication of the Fed's exit strategy for getting its balance sheet and daily operations back to historical norms. I suggested that one necessary ingredient to convince the public that we will see a return to a stable monetary regime would be a credible explanation of how the United States government will be able to meet its enormous current and implicit future fiscal obligations. Today I'd like to discuss a second element that I feel is missing from the exit strategy articulated by Bernanke, and this is a compelling vision of what a healthy financial market not propped up by the Treasury and the Fed would look like.

Let me frame this issue using as an example one of the ongoing Fed-Treasury initiatives that troubles me the most, which is the Term Asset-Backed Securities Loan Facility, or

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According to a report published in The Wall Street Journal, Developers Diversified Realty Corporation (DDR), a leading real estate investment trust (REIT), is planning to raise $600 million through two bond sales.

The bonds are collateralized by two pools of assets valued at $800 million each. The asset pool consists of about 60 shopping centers across the country. The properties generate a stable cash flow as they are occupied by discount retailers that tend to attract more customers during a recession.

On completion, the deals would be the first noteworthy CMBS (commercial mortgage backed securities) offerings to take advantage of the Term Asset-Backed Securities Loan Facility (TALF program). The TALF was created by the Fed to support the issuance of asset-backed securities (ABS) collateralized by student loans, auto loans, credit card loans, and loans guaranteed by the Small Business Administration.

With the bond sales, DDR would be able to raise significant capital

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