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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: Joe Stocks who wrote (85314)	8/19/2007 12:26:30 PM
From: Joe Stocks	Read Replies (2) \| Respond to of 110194

The mortgage situation has to be an opportunity for someone to gain market share. I don't know about you, but most of my neighbors are still paying their mortgage each and every month. So, who are the net benefactors? Here is CFC's July numbers. Are they? Countrywide Reports July 2007 Operational Results 08/14/2007 Click here for a printable (PDF) version of this release. CALABASAS, Calif., Aug 14, 2007 /PRNewswire-FirstCall via COMTEX News Network/ -- Countrywide Financial Corporation (NYSE: CFC) released operational data for the month ended July 31, 2007. Key operational results for July 2007 included the following: Mortgage loan fundings for the month of July totaled $39 billion, an increase of 6 percent from July 2006. Commercial real estate funding volume for the month of July was $803 million, up 88 percent from July 2006. Average daily mortgage loan application activity for July 2007 was $2.7 billion, up 5 percent from July 2006. The mortgage loan pipeline was $62 billion at July 31, 2007, even with the same period last year. The mortgage loan servicing portfolio continued to grow, reaching $1.43 trillion at July 31, 2007. This is an increase of $223 billion, or 18 percent, from July 31, 2006. Banking Operations' assets were $90 billion at July 31, 2007, which compares to $85 billion at July 31, 2006. Securities trading volume in the Capital Markets segment of $371 billion for July 2007 was 33 percent higher when compared to the same month last year. Net earned premiums from the Insurance segment were $124 million, up 32 percent from July 2006. "Mortgage funding volume of $39 billion this month represents an increase of 6 percent from last July, despite a smaller total origination market," said David Sambol, President and Chief Operating Officer. "Mortgage funding volume declined 14 percent on a sequential month basis, which reflects our tighter lending guidelines that have significantly curtailed total production. Average daily application volume for the month was $2.7 billion, 5 percent higher than July 2006, and the mortgage loan pipeline at July 31, 2007 of $62 billion remained constant compared to a year ago. "Countrywide's mortgage servicing portfolio, which last month regained its position as the largest in the nation, increased over $200 billion from July 31, 2006," Sambol concluded. "Total assets in our Banking Operations also increased on a year-over-year basis. In addition, our Capital Markets and Insurance segments posted year-over-year monthly increases in securities trading volume and net earned premiums, respectively."

To: Joe Stocks who wrote (85314)	8/19/2007 2:41:18 PM
From: zebra4o1	Respond to of 110194

Hasn't this guy heard? AAA is now a four letter word. What has people scared in this credit quake is that the AAA rating has become polluted and can't be trusted. Nobody wants MBS now, with or without a meaningless AAA rating from Moody's.

To: Joe Stocks who wrote (85314)	8/19/2007 3:29:17 PM
From: Lazarus_Long	Read Replies (3) \| Respond to of 110194

"Countrywide is too large to fail." Isn't this what was said of LTCM? "It has been one year since the Federal Reserve had to orchestrate a rescue to keep a hedge fund from collapsing. Although no taxpayer money was used in the bailout of the huge fund that some worried was too big for the country to allow to fail, the Fed did have to knock heads at Wall Street's biggest firms to get them to come up with cash to pull Long Term Capital Management back from the brink." marketplace.publicradio.org "Speech by the Financial Secretary ********************************* On the other hand, the costs of self-fulfilling speculation against emerging markets have proven enormous for the developed markets too. Large derivative positions undertaken by hedge funds such as LTCM are now getting "too large to fail". In other words, the balance of risks has shifted towards having some reporting or regulatory net over the behavior of large institutional investors, including private funds." info.gov.hk " Remarks by Julie L. Williams Acting Comptroller of the Currency ............................................................ Questions continue to come from many quarters about the consequences of a mega-bank failure. Are they "too big to fail," or -- as Federal Reserve Board chairman Alan Greenspan recently described the hedge fund Long Term Capital Management -- too big to liquidate immediately?" occ.treas.gov Sound familiar? Where is LTCM now? It was eventually bailed out by its CREDITORS tossing in more cash to make the derivatives it lived on worth something and its employees and management walked the plank. Ironically, after the bailout by the other investors, the panic abated, and the positions formerly held by LTCM were eventually liquidated at a small profit to the bailers The company does have 1/5 of the nation's mortgages and accounts for ¼ of Fannie's outstanding business and 1/3 of its new business, he said. He also says Countrywide is no worse off than the mortgage industry overall (which I'd have to add is pretty bad), and that its trouble has nothing to do with the performance of its loans, but on the capital markets. Countrywide could be sliced up into manageable pieces, the lost causes allowed to die, and the system goes on without Countrywide. The stockholders loose all, of course. Remember, a bankruptcy judge is the only legal dictator we have in this country. "80% of Countrywide's subprimes are aaa rated, nobody's lost a dime," he says. It's all about panic in the market, he says. Investors are terrified of anything that says mortgage, and companies are being penalized because they can't sell the loans. << These companies do their very best to keep their operations as secret as possible. It is this secrecy that creates the fear that leads to panic. If people know the real situation, they can analyze it or get other trusted souls to do so, throw away the junk, and save the jewels. But a lack of information spreads suspicion on all. The financial industry will never learn that its own secrecy is its worst enemy. Who had heard of CDOs before the last several weeks? I had read of them, but the explanation was such that the connection to mortgages and hedge funds could not be guessed. Supposedly , by combining many low-grade credit ratings into one big ball, a higher rating was deserved because all those low-grades would not get in trouble at the same time. Hmmm. NOW it comes out that they are highly leveraged, highly dangerous pieces of toilet paper.