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Millions of Americans are not only upside down on their mortgage, they also appear to be shunning that monthly payment in favor of meeting their everyday expenses.

In the state of California, for example, more than 10% of credit card-carrying consumers were choosing to pay that bill rather than their mortgage as of last fall, according to a recent study published by the credit reporting agency TransUnion.

Borrowers across the country have also been just as anxious to pay down their home equity line of credit rather than their primary mortgage, based on recent figures from the FDIC, if for no other reason but to continue using their house like an ATM.

History has shown that when cash-strapped consumers are trying to make ends meet, the mortgage is often the first thing people stop paying, said Scott Hoyt, senior director of consumer economics at Moody’s Economy.com.

When the U.S. housing market bubble burst, it had that exact effect, shaking up consumers so-called "payment hierarchy."

In good economic times, consumers usually pay the mortgage first, car loan second, and their credit cards and everything else after that.

So with many economists declaring that the recession is likely over, you’d expect more consumers to go back to paying their mortgage first. That’s not happening.

The TransUnion study revealed that the number of consumers who were delinquent on their mortgage but current on their credit card stood at 6.6% in the second half of 2009, up from 4.3% at the start of 2008.

Elevated unemployment levels have helped fuel the change in consumer behavior. But other factors are also at work, according to experts.

For most borrowers, paying the credit card or home equity line of credit is simply more feasible than trying to tackle a significantly larger mortgage payment.

Others have gotten wise to the fact that even after they stop making payments on their mortgage, chances are they won’t be evicted from their home until much, much later. In states such as Florida, for example, foreclosure proceedings have been known to take as long as 18 months.

More often than not however, struggling homeowners simply want to maintain some access to credit in the event they need to take care of their day-to-day expenses such as groceries or to fix the broken muffler on their car.

Unlike in years past where it was relatively easy for questionable borrowers to secure a credit card or home equity loan, banks now make it much more difficult for borrowers to secure a line of credit, said Ezra Becker, director of consulting and strategy in TransUnion’s financial services unit.

Banks have also tried their own programs aimed at getting consumers back on track. Some have attempted modifications on borrowers’ primary mortgage and home equity loan.

The nation’s four largest banks - Citigroup (C, Fortune 500), Wells Fargo (WFC, Fortune 500), JPMorgan Chase (JPM, Fortune 500) and Bank of America (BAC, Fortune 500) - recently agreed to participate in the Obama administration’s Second Lien Modification Program, which aims to stem the rising tide of foreclosures by having banks modify a borrower’s second mortgage.

In instances where consumers have loans with two different financial institutions, banks have tried collaborating in order to minimize losses for both the lender and the borrower, said Shelley Leonard, senior vice-president of consumer lender strategy for Lender Processing Services, a provider of mortgage data to the banking industry.

"I think all the banks are interested in the best outcome for the borrower," she said. "In order for that to be achieved, they will have to address the first and second mortgage."

Others have adopted a proactive approach with customers believed to be at risk of faltering on their loan payments, in an effort to mitigate losses.

The Birmingham, Ala.-based Regions Financial (RF, Fortune 500), for example, implemented a financial check-up in late 2007 on some of its largest mortgage holders or those with adjustable-rate mortgages that were poised to reset.

That appeared to have some success as the percentage of loans in the company’s mortgage portfolio that were in foreclosure stood at 1.95% at the end of last year, less than half the national and regional average, said Barb Godin, an executive in Regions’ consumer credit division.

Consumers are unlikely to stick to such unorthodox financial behavior for good. Experts said that eventually, homeowners will once again start paying their mortgage before everything else.

But for that to happen though, notes Moody’s Hoyt, home prices will have to start improving first. 

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EUREKA — For now and into the foreseeable future, a portion of the road leading to Six Flags St. Louis will be paved with a lot more than good intentions.

It will be covered as well with serendipity, ingenuity, creative persistence and … recycled swine manure.

All that ingenuity has gone into a project believed to have created the first asphalt ever produced from the stuff. And one thing’s for sure:

The witnesses lining the bright stretch of North Outer Drive along Interstate 44 — particularly those with noses and an abiding interest in sustainable technology — won’t soon forget the moment the red dump truck deposited a 15-ton load of the designer asphalt into a road paver late Wednesday morning.

"Whew!" gasped a worker with Pace Construction Co., the St. Louis County road contractor that joined forces with Innoventor, the Earth City-based engineering and design firm that perfected the process of converting the animal waste into a bio-oil used in asphalt binder.

To others, the air swelled with the sweet smell of potential for new manufacturing opportunities, jobs and, possibly, profits. How big is that potential? Nobody knows yet.

"If this works out, it’s a win-win situation for everyone," said Karlton Krause, a hog producer from northern Iowa. "For farmers, it produces revenue. And at the same time, it helps clean the environment. We’re taking a waste product and finding a value-added purpose for it."

The road leading to Six Flags, such as it, began 10 years ago when neighbors started raising a stink over the odors at the hog farm operated by Kent Schien’s in-laws in Barry, Ill., east of Hannibal, Mo., about 125 miles from St. Louis.

Schien, Innoventor’s founder and chief executive, is among the legions of former McDonnell Douglas engineers who left the aerospace giant to start their own companies.

A native of Barry himself, Schien understood the pitfalls of alienating the folks next door in a small town where, as likely as not, the neighbors were also cousins, aunts and uncles.

He turned the problem over to his engineers, who soon developed a technique to "scrub" animal odor as it moved outdoors through fans installed on the outer walls of swine sheds.

Schien was justifiably proud of the company’s accomplishment — until he ran into an acquaintance, also a prominent hog producer. The acquaintance praised the invention for removing the stink. But, he pointed out, an air scrubber is not a revenue generator.

What farmers really needed, he suggested, was an invention capable of turning swine waste — up to 8 pounds of it a day per animal — into a money-maker.

Seeking an answer, Schien returned to his alma mater, the University of Illinois, where an agricultural engineering professor named Yuanhui Zhang was developing a process to transform pig manure into bio-oil.

About three years ago, Schien wedded Zhang’s research with the Innoventor team and put Rick Lux, an engineer with a background in biofuels, in charge of the project.

Lux tackled the mission on two fronts: the former Earth City warehouse space that Innoventor converted into an office, adorned with the names of inventors such as the Wright Brothers and Louis Pasteur. And Rick Rehmeier’s hog farm, outside Augusta, which became an off-site laboratory where the team discovered situations and problems they never expected to encounter.

"I don’t think I ever had a class (in engineering school) that ever covered that," said engineer Gary Winkler, referring to the hog manure pit now integrated into his professional life on line pay day loans.

The objective, Lux understood, was to turn time on its head by compressing the process that created crude oil from decomposed critters that died ages ago.

To reach that goal, the team drew on chemistry, engineering and innate common sense in developing a multiple-stage system that ultimately moved the manure into a reactor, which applies heat and pressure to the waste material.

"Instead of taking 10,000 years, they can (produce bio-oil) in about an hour," said Michael Formica, chief environmental counsel with the National Pork Producers Council.

As Lux and the engineers grappled with the biggest obstacle standing between Innoventor and success — pig hair and dander that constantly "chewed up" grinders and pumps — it seemed they might not be able to improve on Mother Nature’s timeline.

By this winter, though, Innoventor was ready to move to the next phase.

The team got a big boost when tests conducted on the paving material received a passing grade as a "lower-grade asphalt binder" from John Wenzlick, a research engineer with the Missouri Department of Transportation.

And Wednesday morning came the biggest test of all.

The sun was still coming up when Lux pulled into the lot of an asphalt plant operated by Pace Construction in a limestone quarry about six miles from Six Flags, the bed of his Innovator pickup truck loaded with 20 gallons of the bio-oil.

Five hours later, a chute beneath a Pace silo dropped a batch of pig asphalt into the red dump truck operated by Mike Cain of Dittmer, Mo.

As Pace employees shoveled the asphalt into buckets for testing in an on-site lab, Cain asked a reporter to confirm the reason the load was drawing so much attention. He got the confirmation; it was exactly what he thought it was.

He sniffed the air. "Smells nasty," the driver continued. "But I live in the country; I’m used to it."

Within minutes, Cain was backing his truck up to the paver.

In the coming weeks and months, MoDOT and Innoventor intend to keep a close eye on the 500-foot stretch where history, of a kind, was made Wednesday morning. The state will monitor wear and tear on a road subjected to a lot of traffic in the seasons when the amusement park is open for business.

Lux and Innoventor see the earlier blessing by MoDOT as permission to move their work to a larger platform.

"We’ll keep going ahead," he said, as workers tamped down the still-fresh asphalt with rolling machines. "We’ve shown this stuff can be processed at the farm, processed at an asphalt plant and put down on a road."

Other parties will be keeping an eye on what Innoventor has wrought as well.

The U.S. Environmental Protection Agency has an obvious interest in what Glenn Curtis, the chief of wastewater and infrastructure management for the Kansas City field office, calls a "fairly unique concept."

And Formica, with the Pork Producers Council, believes it is important to ascertain whether the value of manure-generated bio-oil offsets the cost the electricity, conventional fuel and other expenses needed to produce the substance.

As for Schien, he is making plans to manufacture the prototype on Rehmeier’s farm for use at hog production facilities across the nation.

The plant, he says, will be located in the place where it all began: Barry, Ill.

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Think Dow 11,000 is a big deal? Think again.

The Dow Jones industrial average briefly hit the milestone Friday for the first time in 18 months before closing at 10,997.

But Wall Street analysts who study key stock index levels say all the attention paid to 11,000 is more like a big distraction. They worry that investors are ignoring another number at their peril: the surprisingly low volume of trading. As stocks have risen over the past year, the volume reflects the vulnerability of a rally riding on the shoulders of relatively few participants.

And that has given pause to even the bulls.

"It worries a lot of us," says Wellington Shields’ Frank Gretz, a technical analyst who specializes in pinpointing market levels at which stocks might suddenly rise or fall. He wonders whether the volume signals that the rally could soon peter out, like the big surges that preceded steep declines in the 1930s in the United States and in Japan more recently.

Louise Yamada, a 29-year veteran of technical analysis who heads an eponymous firm in New York, says she’s not just concerned but confused.

"Why is the market going up?" she asks. "You usually don’t see advances without volume."

The widely cited Dow index, which tracks stocks of 30 companies, is up 70 percent from its lows of more than a year ago. The climb has been one of the strongest in history, and it may herald a strong recovery. But it has been propelled by relatively few trades.

The 200-day moving average volume on the New York Stock Exchange is now at 1.2 billion shares, down from 1.6 billion, a drop of nearly 25 percent, a year ago.

In other words, if there is wisdom in crowds, the stock market is getting dumber.

One reason volume is lower: Main Street investors have largely stayed out of the market, abandoning it to hedge funds, pension funds and other professional investors. Last year, individuals, as tracked by mutual fund flows, yanked $14 billion from stock mutual funds.

Bulls argue that the Dow’s breaching 11,000 may convince ordinary investors that the rally will last. And that will bring a flood of money into the market, pushing indexes higher.

But Janney Montgomery Scott analyst Dan Wantrobski isn’t convinced.

"Main Street investors need confidence in the economy more than the Dow at 11,000," he says. "They need a drop in the unemployment rate."

On that front, there are signs of hope.

Last week the Labor Department reported that 162,000 jobs were generated in March, the most in three years. The unemployment rate was unchanged, at 9.7 percent.

Another boost to the outlook came Thursday from retailers: Sales at stores open at least a year rose 9 percent last month.

And, of course, there are plenty of other indicators of stock market health besides volume.

Technical analysts will make your head dizzy with their talk of "double tops," "double bottoms" and "Fibonacci retracements." Some of them prefer to make the case for a bull market.

For starters, they like the fact that most stocks in various indexes have rallied, and not just a few powerful ones, as is sometimes the case. They also note that nearly nine out of 10 stocks are trading above their 200-day average price — a bullish sign.

Then there’s the argument that maybe volume isn’t really all it’s cracked up to be.

In the last bull market, the trend was completely opposite the one today. The 200-day average daily volume surged to 1.7 billion shares in late 2007, up more than a third from early 2002, as individuals grew more confident in the rally.

As it turns out, they should have sat on their cash. In October 2007, shortly after volume peaked, the market began to collapse. Investors will still be down 22 percent — even if the Dow does eventually close above 11,000.

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A $250 million loan on the Four Seasons Resort Maui at Wailea was transferred Wednesday to a special servicer after owner MSD Capital LP, owned by billionaire Michael Dell, defaulted on the note, according to Fitch Ratings.

The special servicer, which refers to companies that specialize in dealing with loans in default, is CWCapital Asset Management LLC.

The note is part of a whole loan balance of $425 million that was split into two mortgages, according to the Wall Street Journal. The loan was 30-days delinquent as of March 12.

The loan was provided by Deutsche Bank in December 2006, when the property’s value was appraised at $600 million. The value is now estimated at around $190 million, according to Fitch.

New York-based MSD Capital, the firm that handles investments for Dell, bought the resort and its 380-room hotel on 15 oceanfront acres of Maui’s coastline for $280 million in June 2004.

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Arch Coal sued the U.S. Environmental Protection Agency on Friday over the planned veto of a permit for the largest mountaintop coal mine in West Virginia.

The EPA doesn’t have the authority to revoke a Clean Water Act permit once it has been issued, Arch alleges in its federal lawsuit filed in Washington, D.C., according to media reports. Arch received a permit for its Spruce No. 1 mine three years ago.

This is the first time in 37 years the EPA has vetoed such a project, prompting praise from environmentalists.

St. Louis-based Arch Coal (NYSE: ACI), headed by Chairman and CEO Steven Leer, is the second-largest U.S. coal producer with revenue of $2.6 billion in 2009.

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The Georgia Senate Thursday approved a proposed tax on hospitals that Gov. Sonny Perdue is counting on to help balance Georgia’s recession-ravaged fiscal 2011 budget.

The 1.45 percent tax on net patient revenues, which passed 31-15, would raise $163 million to help shore up a state Medicaid program hit with significant enrollment increases due to the recession.

Hospital organizations, which balked when the governor recommended a 1.6 percent tax in January, had come around to support the bill as preferable to other alternatives Perdue said he was prepared to push forward.

Without the revenue from the hospital tax, the governor would be forced to slash Medicaid reimbursements to hospitals and other health-care providers by as much as 16.5 percent, said Senate President Pro Tempore Tommie Williams. That would hurt hospitals’ ability to serve low-income Georgians and drive some doctors to stop accepting Medicaid patients, said Williams, R-Lyons.

“This is about women with children in poverty and the aged, blind and disabled,” he said. “We that have give to those who don’t.”

But Democrats argued that taxing hospitals would hurt the very people Medicaid is designed to help because the tax would be passed on to poor patients.

“This is a sick tax that’s being placed on people in hospitals,” said Senate Minority Leader Robert Brown, D-Macon.

The bill’s supporters, however, said the tax would help Atlanta’s Grady Memorial Hospital, the state’s largest public hospital, because the additional state revenue would allow Georgia Medicaid to draw down several hundred million dollars in federal matching funds. Grady serves more Medicaid patients than any other hospital in Georgia.

In an effort to garner support for the bill, Republican legislative leaders put a three-year time limit on the tax.

But the measure’s opponents said there are better ways to raise the needed revenue. Throughout this year’s legislative session, health-care advocates have been pushing lawmakers to raise tobacco taxes in Georgia by $1 a pack.

The bill now goes back to the House to vote on changes made by the Senate.

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