Countrywide: "Home price depreciation at levels not seen since the Great Depression"

Tuesday, July 24, 2007 | 03:19 PM

An amazing conference call with Countrywide Financial (CFC), the largest US mortgage underwriter. It was beyond ugly. Here are some notable quotables from Chief Executive Angelo Mozilo:

- "During the quarter, softening home prices continued to affect many areas of the country, and delinquencies and defaults continued to rise across all mortgage product categories as a result."

-Delinquencies and defaults rising across all investment tools.

-Lower home prices may effect credit.

-S&P Case-Schiller is strong tracking tool for health of housing market
[Editor: we have referenced this many times]

-CFC continues to study further tightening of loan standards for both subprime and prime

-CEO believes markets will force the weaker mortgage companies to either work with bigger players or look elsewhere for business

-For a Fed Governor to say that the lending group had this coming is unbelievable.

The WTF line that I don't get is this one:

"no one saw the deterioration of real estate values coming."

 

Here comes the money shot:

"Company is seeing home price depreciation at levels not seen since the Great Depression"

-Previously, the company had stated they expected a turnaround in mid-2008; now, they say they are not sure when housing declines will cease. Refuse to rule out house price declines in 2009; 

-Surprising comment regarding the prime portfolio: so far what they have seen in deliquencies is due to people losing job, losing health, lost marriage, more so than any resets. Stated that the "definition of prime may not be as high as some people think."

-Expects to hear mergers and people going out of business in the near future;

-The company cut its 2007 earnings forecast to a range of $2.70 to $3.30 a share, down from previously lowered guidance of $3.50 to $4.30 range (projected in April). In the beginning of the year, the company said it expected to earn $3.80 to $4.80 a share.

>

All told, a simply brutal and market moving nearly 3 hour conference call . . .

Thanks to Briefing.com for the update

Tuesday, July 24, 2007 | 03:19 PM | Permalink | Comments (64) | TrackBack (4)
de.li.cious add to de.li.cious | digg digg this! | technorati add to technorati | email email this post

bn-image

TrackBack

TrackBack URL for this entry:
http://www.typepad.com/services/trackback/6a00d8341c52a953ef00e009995f098833

Listed below are links to weblogs that reference Countrywide: "Home price depreciation at levels not seen since the Great Depression":

» The Big Picture | Countrywide: "Home price depreciation at levels not seen since the Great Depression" from The Capitalist Resistance
Link: The Big Picture | Countrywide: Home price depreciation at levels not seen since the Great Depression. [Read More]

Tracked on Jul 25, 2007 3:18:20 AM

» More bad housing data strike higher incomes from eyeon08.com
UPDATE: The Big Picture has details on the conference call announcing these results. Countrywide Financial Corp. had very bad Q2 profit numbers: The rise in credit-related costs were primarily related to the companys investments in prime home e... [Read More]

Tracked on Jul 25, 2007 4:14:47 AM

» Home Price Depreciation from one iteration
Sigh. Me and one of my friends whom I talk about real estate with knew this was coming, which is why we avoided buying property a few years ago (notwithstanding buying and flipping in a short time). A quote from Countrywide Financials recent c... [Read More]

Tracked on Jul 25, 2007 4:28:54 PM

» Countrywide: Home price depreciation at levels not seen since the Great Depression from PSST! it
An amazing conference call with Countrywide Financial (CFC), the largest US mortgage underwriter. It was beyond ugly. Here are some notable quotables from Chief Executive Angelo Mozilo: - " [Read More]

Tracked on Jul 25, 2007 6:53:48 PM

Comments

I am sitting here watching the containment of the subprime problem. Just think what might happen if it wasnt contained.

Posted by: GerryL | Jul 24, 2007 3:35:46 PM

The comments to this entry are closed.



Recent Posts

December 2008
Sun Mon Tue Wed Thu Fri Sat
  1 2 3 4 5 6
7 8 9 10 11 12 13
14 15 16 17 18 19 20
21 22 23 24 25 26 27
28 29 30 31      

Archives

Complete Archives List

Blogroll

Blogroll

Category Cloud

On the Nightstand

On the Nightstand

 Subscribe in a reader

Get The Big Picture!
Enter your email address:


Read our privacy policy

Essays & Effluvia

The Apprenticed Investor

Apprenticed Investor

About Me

About Me
email me

Favorite Posts

Tools and Feeds

AddThis Social Bookmark Button

Add to Google Reader or Homepage

Subscribe to The Big Picture

Powered by FeedBurner

Add to Technorati Favorites

FeedBurner


My Wishlist

Worth Perusing

Worth Perusing

mp3s Spinning

MP3s Spinning

My Photo

Disclaimer

Disclaimer

Odds & Ends

Site by Moxie Design Studios™

FeedBurner