That headline screams for a Captain Obvious .jpeg.
I see they are no better at it than I am............
More commonly known as selling high/buying low with their profits.
Wait till the euro markets and Chinese markets exposure to CDOs really gets revealed.
http://money.cnn.com/news/newsfeeds/articles/djf500/200708100004DOWJONESDJONLINE000009_FORTUNE5.htm
UPDATE: Countrywide: Secondary Mortage Market Conditions ‘unprecedented’
August 10, 2007: 12:04 AM EST
SAN FRANCISCO (Dow Jones) — Countrywide Financial Corp., the largest U.S. mortgage lender, said Thursday that “unprecedented” poor conditions in the secondary-mortgage market are causing it to retain a greater proportion of mortgage loans than it sells.
In a filing with the Securities and Exchange Commission, Countrywide said that while it plans to retain more loans until investor demand improves, it warned that a prolonged period of poor conditions “could have an adverse impact on our future earnings and financial condition.”
The disclosure was made as part of Countrywide’s (CFC) regular quarterly financial report with the SEC.
In July, Countrywide indicated that widespread troubles in the sub-prime mortgage market have spread to higher-quality loans, when it announced its second-quarter results.
At that time, Countrywide said it expected the general slowdown in the housing market to last at least until 2009.
The “big boys” are frequently wrong. Many institutional money managers are younger folk who don’t have a lot of experience with market cycles(booms and busts). They also have many people looking over their shoulders. That doesn’t help.
Let the Fed bail them out, I don’t think so....Maybe they should ask their underpaid employees to help flip the bill.
From Washington Post, 12/15/2006
“...Both Wall Street firms also outlined their bonus scheme for the period, which was far below the $622,000 per employee being paid out by Goldman Sachs.
Lehman said it would pay its employees an average of $335,441 this year _ paying 25,936 workers a total of $7.7 billion in salary, bonuses and other benefits. At Bear Stearns, staff would receive an average of $321,740 in compensation.”
BS....
The big boys are all on vacation. The minicrisis is precipitated by the ones left to mind the store.