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Countrywide Crushed Again (Lost another 16% of their stock value to Ditech)
http://www.thestreet.com/s/countrywide-crushed-again/newsanalysis/banking/10373527.html?puc=_dm ^ | 8-10-07

Posted on 08/10/2007 5:53:06 AM PDT by Hydroshock

Countrywide (CFC - Cramer's Take - Stockpickr - Rating) plunged 16% in early trading a day after the struggling mortgage lender warned in a regulatory filing that mortgage market disruption could hurt the company's financial condition.

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"Since the company is highly dependent on the availability of credit to finance its operations, disruptions in the debt markets or a reduction in our credit ratings could have an adverse impact on our earnings and financial condition, particularly in the short term," Countrywide said in the risk factors section of a filing made late Thursday.

Countrywide shares have been tumbling since problems with the subprime mortgage market came to light back in February. The stock hit a 52-week high of $45 just before rivals like HSBC (HBC - Cramer's Take - Stockpickr), New Century (NEWCQ - Cramer's Take - Stockpickr) and NovaStar (NFI - Cramer's Take - Stockpickr - Rating) said they would take big losses on loans gone sour to homeowners with poor credit histories. New Century subsequently filed for Chapter 11 bankruptcy.

Countrywide dropped as low as $23 Monday amid worries about the health of the credit markets before bouncing back during a widespread market rally earlier this week.

Shares fell $4.61 early Friday to $24.05.


TOPICS: Business/Economy; Miscellaneous; News/Current Events
KEYWORDS: countrywide; hsbc; mortgage; stocks; wallstreet
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To: Hydroshock

WE LOST OUR SHORTS TO DITECH!


101 posted on 08/10/2007 11:58:36 AM PDT by BurbankKarl
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To: cgbg
This may be the first time ever that drops in home values actually cause a deep recession...

Oh, man...here's another one. Just remember, folks; gloom and doom seem to sell. That doesn't mean you should buy. Gloom and doomers always have reasons that we're gonna die; put in perspective, it's generally less compelling.

A company like Countrywide needs to focus on the aggregate national home market. Everyone who owns a home, however, just has to worry about one, their local market. What happens to your local market will determine what your own home does. Some markets which have seen booming appreciation, perhaps doubling in the last five years, are overdue for a correction. These are the ones you see on the nightly news. This is the kind of reporting you should expect from the MSM.

Other markets are still appreciating. It matters where you live, so don't assume the worst.

That's a simple idea, which is obviously true, needing no further explanation. It explains why this story is interesting, but the theme of depreciating real estate values may not even apply where you live...and those who are peddling it are trying to alarm you.

Don't be jumping out windows, and listen less to those who preach gloom-and-doom.

Perspective, perspective, perspective!

102 posted on 08/10/2007 12:00:44 PM PDT by gogeo (Democrats want to support the troops without actually being helpful to them.)
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To: Hydroshock
No I am afraid it is inevitable.

Would make a good tag line. BTW, the moderator is giving you a early break for the weekend by locking your threads. Lets NOT go overboard on the topic.

103 posted on 08/10/2007 12:04:33 PM PDT by Orange1998
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To: BurbankKarl

DITECH, Dot Commmmmmmmmmmmmmmmmmmmmmmm!!!


104 posted on 08/10/2007 12:04:38 PM PDT by SierraWasp (The American DemocratICK Party... Filled with GANG-GREEN, like CA's Repub Governor!!!)
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To: gogeo

Finally a level head appears. I need you in my corner when the Media starts chicken little segments.


105 posted on 08/10/2007 12:07:56 PM PDT by Orange1998
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To: RockinRight
ARM’s still can’t adjust beyond their parameters - i.e., the margin and index.

And they usually have limits.

106 posted on 08/10/2007 12:08:13 PM PDT by Trailerpark Badass
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To: Orange1998

What you guys don’t like the truth. The way I see it is teh basic underpinnigs of the economy are in tatters. Printing money like crazy and thrown it at the markets will stall the inevitable but not stop it.


107 posted on 08/10/2007 12:12:35 PM PDT by Hydroshock ("The Constitution should be taken like mountain whiskey -- undiluted and untaxed." - Sam Ervin)
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To: Hydroshock
Printing money like crazy and thrown it at the markets will stall the inevitable but not stop it.

More proof you don't know what you're spewing about.

108 posted on 08/10/2007 12:15:15 PM PDT by Toddsterpatriot (Ignorance of the laws of economics is no excuse.)
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To: Toddsterpatriot
It did not help in 1930’s Germany, it is not helping in Zimbabwe
109 posted on 08/10/2007 12:17:34 PM PDT by Hydroshock ("The Constitution should be taken like mountain whiskey -- undiluted and untaxed." - Sam Ervin)
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To: Hydroshock
Comparing adding liquidity today to 1930s Germany just illustrates your ignorance.

So no GDP prediction? Coward.

110 posted on 08/10/2007 12:19:52 PM PDT by Toddsterpatriot (Ignorance of the laws of economics is no excuse.)
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To: Hydroshock

I can’t handle the truth.... sorry. sarc.


111 posted on 08/10/2007 12:24:53 PM PDT by Orange1998
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To: Toddsterpatriot
So no GDP prediction? Coward.

I make a point of not insulting people on this board. But I once heard my Grandfather say, "He who resorts to name calling and shouting is the one losing the argument."
112 posted on 08/10/2007 12:28:01 PM PDT by Hydroshock ("The Constitution should be taken like mountain whiskey -- undiluted and untaxed." - Sam Ervin)
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To: Hydroshock
You’re the one who predicted a recession. Now you’re scared to flesh it out. Would you cry less if I called you a scaredy cat?
113 posted on 08/10/2007 12:30:26 PM PDT by Toddsterpatriot (Ignorance of the laws of economics is no excuse.)
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To: Toddsterpatriot

I have looked that teh current state of the economy and do not like what I see. So I am saying such and preparing my personal affairs accordingly. If anything this current situation with the fed and ECB dumping money into the market makes me more uneasy. Like I said I would have let the market correct itself with out any intervention or at teh bery least waited to get a clear picture of what was happening.


114 posted on 08/10/2007 12:38:13 PM PDT by Hydroshock ("The Constitution should be taken like mountain whiskey -- undiluted and untaxed." - Sam Ervin)
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To: Hydroshock

115 posted on 08/10/2007 12:40:32 PM PDT by Toddsterpatriot (Ignorance of the laws of economics is no excuse.)
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To: Orange1998
I need you in my corner when the Media starts chicken little segments...

What's damnable is that there's enough truth to make the exaggerations seem plausible. We all know that "Things aren't as bad as you think" doesn't sell as well as breathless, sweep week style gloom and doom. It's true, perhaps more so, for CNBC...I suspect viewership doubles if there's "news."

Life is not risk free; we assume risk by getting out of bed in the morning...or is it that we assume risk by staying in bed in the morning...?

Both. If we stay in bed, the house could be hit by a falling airplane, or burn to the ground. We'll lose our jobs, face foreclosure, and be homeless. Those who assume that a risk free existence exists are wrong...and those who believe the sky is falling will make bad choices. Those who believe the economy will grow to the sky without risk will make bad choices, too. Interestingly, they're both making the same mistake...which both would violently deny.

Having good liquidity is always a good thing, so I commend HS on that. It will either get you through the hard times, or provide ammo if you want to go big game hunting...distress sales on real estate, for example.

If you're convinced you know what's going to happen, then events won't change your mind...which can be a problem if reality doesn't cooperate. There are some who would rather be guided by a comprehensible but illogical financial fiction than a reality based but uncertain truth.

Many professional economists avoid this by using language that is incomprehensible, or by using their tried and true rule...when making a prediction, name an outcome or a date, but never both. Toddster knows that...

That's why those who predicted the next Great Depression since the 1970s (and there are a lot of bookwriters who made a fortune predicting it) aren't technically wrong...yet. I assume if we get one by 2030, they'll claim their timing was off...by 60 years? That's a work lifetime. Imagine having your entire adult financial life guided by the fear of depression. Imagine the bull markets and prosperity missed.

116 posted on 08/10/2007 12:47:05 PM PDT by gogeo (Democrats want to support the troops without actually being helpful to them.)
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To: gogeo

Another one bites the dust.

NEW YORK, Aug 10 (Reuters) - Mortgage lender HomeBanc Corp (HMBN.PK: Quote, Profile, Research) has filed for Chapter 11 bankruptcy protection, two days after agreeing to sell most of its assets to Countrywide Financial Corp. (CFC.N: Quote, Profile, Research), and said it plans to shut down.

Atlanta-based HomeBanc listed $5.1 billion of assets and $4.9 billion of debt in a filing late Thursday with the U.S. Bankruptcy Court in Wilmington, Delaware.

“Recent disruptions in the mortgage loan and real estate markets have been dramatic, in terms of both magnitude and timing,” Chief Executive Kevin Race said. These conditions put HomeBanc in an “untenable business position,” he said.


117 posted on 08/10/2007 12:57:36 PM PDT by Orange1998
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To: Orange1998
I predicted this over a week ago. We're going to see substantial interest rate cuts soon...Starting no later than next month.

The closest I see you predicting mortgage rates before this crisis is your post below. Could you point me to your claim.

That's because I didn't post it. HA! Unless you were standing with my neighbor and I, about a week ago, when I bet him a dinner that interest rates would be cut rather substantially, within a month...

And I stand by it. I predict interest rates will drop rather dramatically by next month. Hey, I could be wrong...lol

118 posted on 08/10/2007 1:02:55 PM PDT by dragnet2
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To: dragnet2

You little devil you. LOL. The market almost closed in the black. Not much to see here, moving on.


119 posted on 08/10/2007 1:05:13 PM PDT by Orange1998
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To: Orange1998
Those directly involved will take a bath. For everyone else it will be merely an inconvenience.

This is a time honored process that's called "taking out the garbage." There are a lot of comnpanies that should have never been in the business, that are no longer. There are companies that made a lot of money making loans that should never have been made...they are no longer.

It's interesting to watch, and instructive. For borrowers, they should ask more about the type of person and company they're doing business with. Loan Officers and loan reps will consider more carefully the business plan of the companies they work for. Wall Street will take a hit, as will some investors.

It make for good theater, at least. It's no financial judgment day.

120 posted on 08/10/2007 1:12:51 PM PDT by gogeo (Democrats want to support the troops without actually being helpful to them.)
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