Countrywide sees 'unprecedented disruptions'
Good morning. We aim to keep this blog focused on Los Angeles, but at the moment, turmoil in financial markets is the story driving local real estate. If investors continue to shun mortgage-backed securities, mortgages loans will not be easily available. So we begin today with more turmoil:
Countrywide Financial said it faces "unprecedented disruptions" because investor demand for mortgages has dropped sharply. LATimes: "The Calabasas-based lender said in a regulatory filing that the market turmoil has forced it to hang on to more mortgage loans than it would like..." Bloomberg: "'The secondary market and funding liquidity situation is rapidly evolving, and the potential impact on the company is unknown,' Countrywide said in an SEC filing. 'These conditions may continue or worsen in the future.'"
The Federal Reserve on Friday morning again pumped liquidity into financial markets: "The Fed, in a short statement, said it will provide 'reserves as necessary' to help the markets safely make their way. The central bank did not provide details but said it would do all it can to "facilitate the orderly functioning of financial markets." You can read the entire Fed statement here.
Photo Credit: Countrywide CEO Angelo Mozilo, by Reuters
Thoughts? Comments? Insights?
Mozillo should stop wasting his time sun tanning and mind the ship. It is sinking!
Posted by: willie | August 10, 2007 at 08:06 AM
Oompa loompa doompeda dee, If you are wise you'll listen to me......
Isn't this the song he's been sing now since the begining of the year? Our company will be ok...blah blah blah........Now they are having troubles. Looks like he won't be getting his $120 million bonus to spend on more bad tanning.
Posted by: Jennifer | August 10, 2007 at 09:18 AM
Jennifer, thanks for a big morning laugh - that was good.
Posted by: Kathy | August 10, 2007 at 09:57 AM
Don't feel bad... Angelo is going to do ok. Probably fly out on an AIG leased G5 and end up at a soup kitchen in Sardinia. Remember, the old Ameriquest fellow, the bellweather for this perfect storm, was awarded an ambassadorship after he bailed out. You can never be too rich, too thin, too tanned, or too close to the edifice when it collapses.
If I were a rich man... daydle daydle daydle dye o/`
Posted by: BetterVillage | August 10, 2007 at 10:31 AM
The makes the second orange person I have seen. The other one lost a democratic run on the White House and is married to a condiment queen.
Posted by: Rage | August 10, 2007 at 01:50 PM
This sounds familiar to what happened last week.
The other day Countrywide was saying that they still have the capital and assets for liquidity. Why will they ever say that? Just to calm their investors? I don't think so. That means there really is a problem. There's a BIG problem.
Last week American Home Mortgage filed for bankruptcy and they were trying to calm their investors before they filed for bankruptcy.In just a few DAYS they are gone. Countrywide is bigger but in just WEEK/S everything could go really wrong and they will file for bankruptcy as well. SAME SCENARIO. Same industry.
What's next? FINANCIAL CRISIS...RECESSION...
Posted by: Jet | August 10, 2007 at 02:49 PM