T-minus ? until Countrywide goes under.. . .

NEW -> Contingent Buyer Assistance Program
<p>5.30 for CFC; 5.70 for IMB</p>

<p>Sell.. . . sell. . . sell...Frozen Concentrated Orange Tan </p>

<p><a href="http://www.youtube.com/watch?v=RAXdie_gifI">www.youtube.com/watch</a></p>

<p> </p>

<p> </p>
 
This is giving me that "New Century" feeling all over again.

But this is the big daddy of them all. Once all the facts come out about how much this company has

lost its going to be up there with Enron. Us taxpayers are going to wind up covering 50 Billion + when this implodes

at the end. And that end is very near indeed.
 
<p>I hate to ruin your fun, but cha all might want to read Tanta's take on Calculated Risk before you find CFC guilty.</p>
 
<p>Awgee,</p>

<p>I think that CFC got sloppy and never truly updated their policies. During the happy days, foreclosures and late payments were non-existent so there were no problems. Now, everyone is trying to protect their jobs and thus push the buck off on someone else. No one wants to get up and say it was my bad because pink slips may come as a result. </p>

<p>Now, CFC's lawyers are bordering on malpractice and definitely should be sanctioned for misleading the court. Before they file the documents with the court, the lawyers have an ethical obligation (stop laughing. . . we have those) to question the client as to the validity and nature of the document. After all, it is the attorney's name that goes on the pleading or motion, not the client's. For CFC's attorneys to submit such documents is pure carelessness if not outright fraudulent.</p>
 
<p>Guess CFC is going to report on Tuesday 1/29/08. Fourth Quarter results. Before the market opens. </p>

<p>The article about forged documents in the NY Times is very damning. The board has been saying that things are turning around for the last 2 quarters. At some point the officers have responsibility to be truthfull in the forcasting. They have so much REO inventory and their entire business was built on the model of "ever increasing property values". At a point borrowing more and continuing operation becomes criminal behavior. Calculated risk is one thing. Outright fraud and misrepresentation is another. </p>

<p> </p>
 
IMO it really doesn't matter whose at fault or how much confidence you have in their forecast for this qtr or any qtr going forward. If CFC wants a remote chance to stay alive they need to go black quickly and fix all of their internal problems. Offload the REOs at whatever price they can get, clean up their internal controls, and revise their business model. At that time maybe if they are lucky they can come back as a publically traded company. But at this point I see no reason why they should be listed as a tradable security.
 
<p><a href="http://www.dealbreaker.com/2008/01/how_we_got_here_downpayments_w.php">http://www.dealbreaker.com/2008/01/how_we_got_here_downpayments_w.php</a></p>

<p>On Monday, February 17, 2004, the National Mortgage News informed its readers that Angelo Mozilo wanted to eliminate downpayments on mortgages. Actually contributing equity to purchase a home is “nonsense,” Mozilo tells the News. He decries credit score requirements as too high. </p>

<p>“The only way we can have a better society,” Mozillo says, “is to make sure those who don’t have a house have the opportunity to get one.”</p>
 
I think the BK rumors are more damning than this so-called document forgery. It's one downgrade away from junk bond status. It soon won't be able to acquire funds unless they are of the bailout variety. I'm sure B of A is pissed right now.
 
<p>LM, going to have explain that in economic-idiot language.</p>

<p>I have some understanding of what is going on but what exactly does it mean that CFC's stock worth is approaching its REO worth? They still have assets that are not factored into its stock value...right?</p>
 
IC, Everything "should" be factored in at all times (various forms of efficient market hypothesis).The company has liabilities too, and I'm guessing the asset values were whatever was on the books at the time of the last SEC filing (not sure about REOs...outstanding loan amount?). We know they are most certainly overvalued. Besides assets and liabilities, the market cap should factor in the net prestent value of expected future cashflows. It'll be interesting to see what that value is right now...
 
Last quarterly filing shows assets of $209B and liabilities of $194B. The $3B market cap is virtually a rounding error for a company of this size...they're busted, aren't they?
 
If, and I mean capital <b>IF</b> CFC files for bk, the counterparty risk from credit default swaps written on CFC could start a deflationary spiral that could send the financial world into absolute panic. I doubt if 10% of the swaps written on CFC can be made good by the counterparties, and I am an optimist.
 
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