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Non-Tech : Bill Wexler's Trading Cabana -- Ignore unavailable to you. Want to Upgrade?

To: RockyBalboa who wrote (1694)	2/24/2007 9:14:18 PM
From: RockyBalboa	Respond to of 6370

Centex CTX, revenue will be significantly down: Message 23303940

To: RockyBalboa who wrote (1694)	2/26/2007 12:34:34 PM
From: RockyBalboa	Read Replies (2) \| Respond to of 6370

Banking Subprime Flu Spreads By Laurie Kulikowski TheStreet.com Staff Reporter 2/26/2007 9:33 AM EST URL: thestreet.com Some market watchers believe we haven't seen the worst of the subprime lending meltdown. Wall Street remains generally bullish on the financial stocks, reasoning that February's mortgage-industry flailing has been limited to smaller, more aggressive lenders such as NovaStar (NFI) and New Century (NEW) . Still, some observers expect rising defaults by borrowers with poor credit histories to ripple throughout the lending industry. These people note that though big players haven't been hit hard so far, almost everyone in the finance business has some role in buying or selling subprime loans -- and therefore could be hit as the business runs aground. "This is just the tip of the iceberg," says Peter Schiff, president of the brokerage firm Euro Pacific Capital in Darien, Conn. "People are sweeping this under the rug like some kind of isolated event that's not going to affect the entire mortgage market or housing market -- and nothing could be further from the truth. This is just the beginning." Subprime mortgages, which are loans that are made to borrowers with poor credit histories, make up 13% of the $10 trillion mortgage market, according to the Mortgage Bankers Association. Subprime lenders typically make a profit by making loans and then selling them to brokerages that resell pools of mortgages as securities in a process known as securitization. That business has soured as home prices have slipped after years of sharp increases. The slowdown in housing price appreciation has led to increasing customer defaults, prompting buyers of mortgage securities to demand that the originators buy back loans gone bad. Shares in New Century and NovaStar each lost more than a third of their value in a single day earlier this month after the lenders warned of deteriorating lending conditions. At least three subprime lenders -- Ownit Mortgage Solutions, Mortgage Lenders Network and ResMae -- have filed for bankruptcy in recent months. Big banks have felt some fallout from the subprime slowdown. HSBC (HBC) said earlier this month that it will spend an additional 20% during the fourth quarter to cover souring loans in its subprime portfolio. Wells Fargo (WFC) is cutting 320 positions in its subprime mortgage business as it tightens lending standards, which means making fewer loans. Washington Mutual (WM) said the subprime mortgage industry "significantly weakened" during the fourth quarter, hitting pretax earnings to the tune of $160 million. Numerous other big banks and brokerages have been active in the subprime mortgage business, either through securitizations or through purchases of subprime lenders. Citi (C) , Bear Stearns (BSC) and Lehman (LEH) are just a few companies that cobble together purchased loans to resell to institutional investors as securities. Merrill Lynch (MER) said in September that it would pay $1.3 billion to buy National City's (NCC) First Franklin mortgage franchise. In December, HSBC inked a deal with Keycorp (KEY) to buy a $2.5 billion subprime portfolio from its subsidiary Champion Mortgage. Still, Wall Street has been betting that the damage will be contained. "When you start looking at the more diversified organizations, the effect of any deterioration in subprime is clearly muted by other things happening in the organization," says Sharon Haas, a managing director at Fitch Ratings. That doesn't mean there will be delinquencies, she says, but it will be "pretty manageable." So far, equity markets remain robust and merger-and-acquisition activity has been moving ahead at a breakneck pace. Even so, some observers see problems ahead. Carl Tash, a portfolio manager of Cliffwood Partners, a long/short real estate securities hedge fund that does not own shares in mortgage lenders, expects the "Alt-A" market to be the next issue in the mortgage sector. Alt-A loans include option adjustable-rate mortgages, negative amortization loans and other nontraditional loans. These loans are made to homebuyers whose credit is generally better than that of subprime borrowers but worse than that of prime borrowers, on the basis of FICO credit-quality scores produced by Fair Isaac (FIC) . "Everyone says these problems are contained in subprime," Tash said in a recent interview with TheStreet.com. "If you think about it logically, what is the difference [between subprime and Alt-A] ? Some arbitrary difference in FICO scores." Schiff, whose firm doesn't own shares of the lenders, likened the mortgage bubble to the dot-com craze in the late 1990s, in which observers ignored the failure of the smaller Internet companies as a harbinger of things to come. "One of the reasons that real estate prices were so elevated is because a whole class of people came into the market, who under normal credit terms would not have been homebuyers," Schiff says. "When you take away the ability of these people to buy homes ... you knock out a lot of buyers."

To: RockyBalboa who wrote (1694)	8/16/2007 11:03:10 AM
From: RockyBalboa	Respond to of 6370

COUNTRYWIDE CFC... once a target, now a junkie. Can you believe it???? Moody's says it may cut Countrywide below investment grade By Alistair Barr Last Update: 10:53 AM ET Aug 16, 2007 Disable SAN FRANCISCO (MarketWatch) -- Moody's Investors Service downgraded the senior debt ratings of Countrywide Financial (CFC:17.99, -3.30, -15.5%) on Thursday and said that it may lower them again to below investment grade. Moody's, a leading rating agency, said it downgraded Countrywide Financial's senior debt ratings to Baa3 from A3. Baa3 is the lowest investment-grade rating. All of Countrywide's ratings remain under review for further downgrade, Moody's noted. "The downgrade of Countrywide's ratings reflects significant diminution in the company's liquidity and debt market access due to the stresses being experienced in a wide array of single-family mortgage markets -- stresses that have caused Countrywide to fully draw its committed back-up bank lines," Philip Kibel, a Moody's analyst, said. Difficult financial markets also create potential challenges to Countrywide's franchise and leadership in the mortgage banking business, he added. ------------------------------------------------------------ Message 23315279