The Federal Open Market Committee, led by beleaguered Chairman Ben Bernanke, lowered the short-term federal funds rate Wednesday down 50 basis points (half a percent) to 3 percent. That’s two hefty cuts — a combined 1.25 percent — in little more than a week! Way to go Ben!!!

But is it enough to save the faltering real estate market in this time of crisis? There were more than 1 million more foreclosure filings in 2007 than there were in 2006, and 2008 promises to be equally surprising in terms of foreclosure levels.

For its part, the Fed has wavered in its view of the crisis begrudgingly, early on calling it a “correction” in FOMC statements last year. In its latest statement the FOMC is now calling it a deepening “housing contraction!”

You can use all the “C” words you want Ben, but housing usually leads the country in and out of economic “recession” (that “R” word you refuse to give into) and bluntly some areas of the country are probably feeling like they are already there.

Frankly, not everybody believes these latest cuts are going to help. Either they are too little too late, or it’s going to take too long to figure out if they helped at all, and by then we may already be in a recession.

Talk to the folks in Detroit and Cleveland right now who are experiencing high levels of foreclosure activity and unemployment. Try to sell the notion that our present economy is sustainable and won’t take a further dip with out-of-control inflation to the vanishing middle class of America. Good luck Ben. You’ll need it!

Yes, the credit market has tightened its stranglehold on funds, and yes, the financial markets are hurting and under tremendous stress, but people need a place to live and more and more of them are losing their homes and seeking rental arrangements in this time of soaring rents, energy costs and food costs. Not a conducive environment for homeownership to say the least.

In any case, these latest interest rate adjustments are good news for people who can rightfully qualify for home mortgages these days — particularly investors looking to pick up some good bargains in local real estate markets around the country where less fortunate folk have already lost their homes to foreclosure.

Arguably the most influential television news magazine, 60 Minutes, last night spent more than 15 minutes — an eternity in television — focusing on the so-called Subprime Meltdown. The town they chose to use as a backdrop not surprisingly was Stockton, Calif., which ranked No. 1 in terms of nationwide metro foreclosure rates in both the third quarter and November, according to RealtyTrac.

Much of the 60 Minutes piece stuck with the standard storyline: greedy lenders offered piles of money to anyone who could fog a mirror without really caring if the loan could or would be repaid. That's because the lenders could easily turn around and sell the loans to greedy Wall Street firms who wrapped up the loans in pretty packages and sold them to investors.

However, to their credit, the producers of the piece also included one contributing factor to the unfolding debacle that is not emphasized much in the media: the greed of the homeowners and investors who took advantage of these loans, and the ability of many of those people to walk away from the properties without feeling much immediate pain in their pocketbooks. That's because many of these buyers took out 100 percent financing, so the only money they've shelled out for the property is the monthly mortgage payments — which of course they have stopped paying if they are now in foreclosure. View video.

RealtyTrac will be releasing its December, fourth-quarter and year-end numbers tomorrow morning, and we'll have the full details posted on this blog immediately when they are released (5 a.m. EST, 2 a.m. PST). But for now, here's a little taste of what to expect from Stockton. Below is a map showing fourth-quarter foreclosure filings in the area, broken down by type of filing. We'd like to hear from folks in and around Stockton about whether this represents what they're seeing in the area. And if you'd like a similar map of your area, submit your request via comment and we'll try to provide it for you.

In what may end up being a precedent-setting test case, the Star Tribune is reporting that a northern Minneapolis neighborhood is suing CitiMortgage over a foreclosed property that has remained vacant, alleging that the deteriorating state of the property is bringing down their property values.

The lawsuit, filed by the non-profit Foreclosure Relief Law Project, alleges “negligent and improvident lending practices” were used to finance the purchase of the property on 31st Avenue N. Located in what the Star Tribune calls the “epicenter of the Twin Cities foreclosure crisis,” the empty two-story house has garnered numerous 911 calls to police and fire departments, and has been tagged for un-mowed grass, weeds and rubbish.

The neighborhood has attempted to contact the lender but to no avail. Prentiss Cox, a law professor at the University of Minnesota, told the Star Tribune that one of the biggest initial hurdles the lawsuit faces is establishing that the neighborhood “has standing to sue as an entity harmed by the mortgage deal.”

The cities of Baltimore and Cleveland have recently sued national lenders to recover millions of dollars lost due to increased foreclosure activity from the deceptive lending practices of the recent past.

RealtyTrac will continue to follow this story as it progresses through the legal system. Stay tuned!

As more families around the nation come face to face with the daily realities of economic distress, and the possibility of being foreclosed and evicted from their home lingers overhead, family pets are increasingly becoming victims without a voice.

An article in the Chicago Tribune addresses how while some Chicago homeowners losing their homes to foreclosure are turning their pets into local animal shelters, in the most inhumane and disgusting cases people are vacating their homes and leaving their pets to starve, either too embarrassed to admit they are in foreclosure, or figuring the animals will be found and taken care of. In either case the scenario has turned tragic for dogs, cats, birds, horses and other animals.

“Abandoning pets for any reason, is not only irresponsible — it is illegal,” said Stephanie Shain, director of outreach for companion animals at The Humane Society of the United States, in a statement released by the organization early this month.

The HSUS press release offers good, responsible alternatives including foster care for animals.

Being forced to move into a rental property that does not accept pets, or not being able to afford to live in one that does, is no excuse for leaving pets — which many people consider to be another member of the family.

There is help available. All it takes is a phone call or a search on the Internet for solutions. If you’re looking at a situation like this, use those tools and get help. Foreclosure effects EVERYONE in the family — human and otherwise.

With foreclosures helping to push the economy to the brink of recession, President George W. Bush unveiled a $145 billion economic stimulus plan today that includes tax relief for individuals and tax incentives for businesses. President Bush, acknowledging the risk of recession, embraced a sweeping tax relief plan to give the economy a “shot in the arm.”

President Bush didn’t reveal specific components of the plan, but The Wall Street Journal claims that it includes tax relief for individuals — probably to come in the form of one-time $800 rebate for individuals and $1,600 for households. Moreover, the plan could include tax breaks for businesses, including small companies, to make new and major investments this year.

“We’re in the midst of a challenging period, and I know Americans are concerned about our economic future,” said Bush in a prepared statement.

But as the shadow of recession spreads across the country, views are mixed on whether an economic stimulus plan will avoid a recession.

Do you think a recession is coming (or already here)? Will foreclosures drive the economy into a recession?