Posted on 08/15/2007 12:32:32 PM PDT by Hydroshock
NEW YORK (Reuters) -- Shares of Countrywide Financial Corp. dropped as much as 19 percent Wednesday on market rumors the mortgage company has been unable to raise money from the commercial paper market.
Countrywide officials were not immediately available for comment.
"People are buying Countrywide puts very aggressively on Wednesday off of rumors that the commercial paper market could be closed to them," said William Lefkowitz, options strategist at brokerage firm vFinance Investments.
Puts are options that allow an investor to sell a stock at a preset price by a certain date.
Another trader attributed the drop in the stock to the rumor.
Countrywide (down $4.40 to $20.06, Charts, Fortune 500) shares dipped 17 percent in late session trading on the New York Stock Exchange
(Excerpt) Read more at money.cnn.com ...
That's hard for me to believe.
If Countrywide cannot sell commercial paper, then they are probably not viable as a major financial corporation since they would likely be facing a severe liquidity problem.
Look up Stephen Schwartzman, who earned 400 million last year and threw a crazy ass 60th birthday party for himself. That got everyone's attention
I have some very interesting bond opportunities for you.
You should read their recent financials from last week. It ain’t pretty.
Shareholders shouldn't ``understate the importance of liquidity,'' Bruce wrote. ``If liquidations occur in a weak market, then it is possible for CFC to go bankrupt,'' said Bruce, who downgraded Countrywide to ``sell'' from ``buy.'' The Calabasas, California-based company trades under the ticker CFC.
I just heard a Ditech ad that said “get a loan on your equity and we’ll give you a credit card SO YOU CAN PAY DOWN YOUR DEBTS.
Unfortunately, the suckers will line up despite all the news.
” almost paid off on his mortgage then refied through country wide.’
Him not so smart. Must like making payments.
Hearing rumors about alot of margin calls going on...
Selling into a falling market can only exacerbate the situation.
Country Wide is not on your side.
How had he ‘almost’ paid off his loan but his refi prepayment penalty is 20k in interest payments alone and would put him over what his home is worth? He must have taken out a helluva large equity amt in his house. Not very smart.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.