Weekday NEWS to Comfort the Disturbed and Disturb the Comfortable.
Mon 07.14.2008
A new American reality: The government as provider In a country that holds itself up as a citadel of free enterprise, Washington has morphed from being the lender of last resort into effectively the only resort for home loans for millions of Americans engaged in the largest transactions of their lives.Before, the government's more modest mission was to make more loans available at lower rates. Now it is to make sure the loans that matter most to middle class Americans are made at all.The new reality is scorned by libertarians and conservatives, who fear intrusions by the state in the market, and by populists and progressives, who rue a society in which education and housing increasingly rest upon the government's willingness to finance it."If you're a socialist, you should be happy," said Michael Lind, a fellow at the New America Foundation, a research institute in Washington. "But you should really wonder whether you want people's ability to pay for housing and college dependent on the motives of people in Washington."
More US Banks May Fail After IndyMac More U.S. banks may fail after the collapse of mortgage lender IndyMac Bancorp, straining a financial system seeking stability after years of lending excesses. More than 300 banks could fail in the next three years, said RBC Capital Markets analyst Gerard Cassidy, who had in February estimated no more than 150. While analysts decline to speculate about which banks might fail, several smaller lenders and even larger ones appear to have elevated levels of soured loans relative to their sizes. "You have to look at companies with the greatest exposure to the highest-risk assets, which include construction loans and exotic mortgages," Cassidy said. "The final nail in the coffin for any depository institution would be a funding crisis where it is unable to gather deposits at reasonable cost, or wholesale funding markets are cut off."
After IndyMac, Who's Next? I’m outside IndyMac headquarters all day Monday (or should I say IndyMac Bank FSB), as every depositor in America watches to see what happens when a big bank fails and the FDIC comes in to take over. I feel like a kid again. Back in the ‘80s I was chasing Charles Keating around a federal courthouse and trying to track down then-California Senator Alan Cranston, one of the “Keating Five” (which included John McCain). Chris Thornberg at Beacon Economics says, “IndyMac was the first major institution that wasn’t too big to fail.” He says as the Feds are busy worrying about “the big boys”—Fannie and Freddie—hundreds, maybe thousands, of smaller, regional banks will now realize they have no savior. Thornberg says investors in those banks have to ask themselves, “Is this institution fundamentally safe?” Depositors with accounts insured by the FDIC don’t have to worry…unless the FDIC starts to run low on funds. That looks unlikely at the moment. It has $53 billion, and says IndyMac—by far the largest bank takeover this year—will cost it between $4 billion and $8 billion.
Fannie, Freddie Woes Worse Than Bear's in Some Ways In March the crisis du jour was Bear Stearns Cos. Now it is Fannie Mae and Freddie Mac. Both have shaken Wall Street and raised concerns about the financial system's stability. But there are striking differences between Bear, an investment bank that collapsed and had to be rescued by J.P. Morgan Chase & Co., and the two mortgage giants. Bear collapsed seemingly overnight because it lost its customers and funding in what amounted to a run on the bank. That kind of meltdown is unlikely to happen with Fannie and Freddie because the federal government implicitly guarantees their debt. People are still willing to lend money to the two government-sponsored enterprises. "The credit markets have always treated them as special," said Lawrence J. White, a professor of economics at New York University's Stern School of Business. He said the market has always believed that, "if they ever got into financial difficulty, it would be highly likely that the federal government would step in to honor their obligations."
Paulson Seeks Authority to Shore Up Fannie, Freddie Treasury Secretary Henry Paulson swung the weight of the federal government behind Fannie Mae and Freddie Mac, the beleaguered companies that buy or finance almost half of the $12 trillion of U.S. mortgages. Paulson, speaking on the steps of the Treasury facing the White House, asked Congress for authority to buy unlimited stakes in and lend to the companies, aiming to stem a collapse in confidence. The Federal Reserve separately authorized the firms to borrow directly from the central bank. The announcement followed crisis talks between the firms, government officials, lawmakers and regulators, after Fannie Mae and Freddie Mac lost about half their value last week. Paulson and Fed Chairman Ben S. Bernanke are trying to prevent a collapse in the companies that would exacerbate the worst housing recession in 25 years and deepen the economic slowdown.
Federal deficit grows to $268.7 billion The Treasury Department says the federal deficit swelled to $268.7 billion in the first nine months of this budget year as record spending during the period outpaced revenues.The department's fresh look at the government's balance sheets, released Friday, shows that the deficit for the budget year that began Oct. 1 was up sharply from the red ink of nearly $121 billion for the corresponding nine-month period last year.The new year-to-date deficit of $268.7 billion was the third-highest on record. A flood of tax rebates, aimed at stimulating the sluggish economy, left the government's coffers and contributed to the bigger deficit, according to an analysis by the Congressional Budget Office. Spending totaled $2.2 trillion, while revenues came to $1.93 trillion.
Dollar Index May Decline to Record Low on Charts, Goldman Says The U.S. Dollar Index may extend its decline to reach a record low of 70.70 should it close below so- called support at 71.82, said Kevin Edgeley, a technical analyst at Goldman Sachs Group Inc., the world's biggest securities firm. The index, which tracks the performance of the dollar against six of the nation's biggest trading partners, has fallen through the lower boundary, or support, of an ascending channel that connects the lows of March 17, April 22 and May 22, London- based Edgeley said. The next support level at 71.82 is the low set on May 22, he said. Support is a level where buy orders may be clustered. ``The Dollar Index has broken below the shallow bull channel base line again, testing wave support at 71.82,'' Edgeley wrote in a research note yesterday. ``A close below would suggest a retest of the all-time lows at 70.70.''
----------- More News Headlines, posted earlier on Monday ---------------
IndyMac bank crisis signals new takeover era A new era for the U.S. government's takeover of failed banks is about to begin. IndyMac Bancorp became the biggest casualty of the subprime mortgage crisis over the weekend, as federal regulators shut down the troubled Pasadena, Calif.-based savings bank in one of the largest U.S. bank failures ever. The Federal Deposit Insurance Corp. (FDIC) said in a statement that it will take over operations of IndyMac, which will open for business today as IndyMac Federal Bank. The thrift - the fifth U.S. bank to fail so far this year — had total assets of $32 billion as of March 31. In a televised statement Sunday afternoon, FDIC Chief Operating Officer John Bovenzi said that "come Monday morning, it will be business as usual," and urged customers to "view this as a change in ownership."
US spells out Fannie-Freddie backstop plan Fed offers to lend to mortgage companies, Treasury plans possible equity investment Scrambling to bolster eroding investor confidence, the Federal Reserve and the Treasury Department announced steps to brace slumping mortgage giants Fannie Mae and Freddie Mac. The companies' shares, which have plunged as losses from their mortgage holdings threatened their financial survival, opened higher Monday. Fannie Mae rose 27 cents to $10.53, while Freddie Mac climbed 34 cents to $8.08. The plan, unveiled Sunday, is intended to signal the government is prepared to take all necessary steps to prevent the credit market troubles that erupted last year with losses from subprime mortgages from engulfing financial markets. The Fed said it granted the Federal Reserve Bank of New York authority to lend to the two companies "should such lending prove necessary." They would pay 2.25 percent for any borrowed funds -- the same rate given to commercial banks and big Wall Street firms.
Fannie & Freddie - Our brand of Socialism Time for comrade Paulson to pull the plug on the Fannie and Freddie charade Are Fannie Mae and Freddie Mac adequately capitalised, as asserted recently by US Treasury Secretary Hank Paulson, Federal Reserve Board Chairman Ben Bernanke and their regulator Office of Federal Housing Enterprise Oversight Director James B. Lockhart III? The answer is: obviously not, if these two government-sponsored enterprises of the US federal government had to make a living on normal private commercial terms. Obviously not if they were subject to the market discipline preached by Paulson and Bernanke, but not practiced when it comes to large financial institutions perceived as systemically important (too large or too interconnected to fail) or too politically sensitive to fail. The Federal National Mortgage Association (FNMA) and the Federal Home Loan Mortgage Corporation (FHLMC) are government-sponsored enterprises of the US federal government. They are shareholder-owned corporations authorized to make loans and loan guarantees. Fannie Mae was founded as a government agency in 1938 as part of Franklin Delano Roosevelt’s New Deal. For the next 30 years, it held a virtual monopoly on the secondary mortgage market in the United States.
Ripple Effects From Fannie And Freddie Mortgage Giants' Problems Could Mean Higher Loan Rates The crisis at Fannie Mae and Freddie Mac, once the unwavering giants of the mortgage finance industry, could make getting a home loan even more difficult at a time when lenders are already tightening their grip on credit, industry experts and financial advisers said. If you're thinking of buying or refinancing a home, expect to see a rise in mortgage rates, the experts said. But if you already have a mortgage, even one backed by Fannie Mae or Freddie Mac, you should have nothing to fear as long as you have no pressing need to refinance, they said. A spike in rates could also drive homeowners into foreclosure as hundreds of thousands try to refinance out of adjustable-rate mortgages that are scheduled to reset this summer.
More bank failures to come after IndyMac, say analysts As many as 300 banks could fail over the next three years More U.S. banks may fail after the collapse of mortgage lender IndyMac Bancorp, straining a financial system seeking stability after years of lending excesses. More than 300 banks could fail in the next three years, said RBC Capital Markets analyst Gerard Cassidy, who had in February estimated no more than 150. Banks face pressure as credit losses once concentrated in subprime mortgages spread to other home loans and debt once-thought safe. This has also led to investor worries about the stability of mortgage finance companies Fannie Mae and Freddie Mac; IndyMac is not related to either. While analysts decline to speculate about which banks might fail, several smaller lenders and even larger ones appear to have elevated levels of soured loans relative to their sizes.
Midwestern banks brace for tough round of results A wave of gloomy results from the second quarter are expected to be the highlight of reports that Midwestern regional banks will issue in the coming days, analysts say. Regional stalwarts U.S. Bancorp, Marshall and Ilsley Corp. , Huntington Bancshares , Comerica Inc. and KeyCorp are all slated to report earnings over the next two weeks. Most banks across the nation have warned that plummeting housing prices and other financial strains on borrowers are forcing large loan write-offs and provisions for bad loans, undermining quarterly profits. But regional banks could benefit from strong market presence because they know their customers and markets well enough to weather most impending financial turmoil, Greg Ketron, a Citigroup analyst, wrote in a note to investors. U.S. Bancorp will report earnings on Tuesday and is expected to post a profit of 60 cents a share, down slightly from the profit of 65 cents a share the Minneapolis-based bank recorded a year earlier. The nation's sixth-largest commercial bank operates 2,522 offices in 24 states.
Gold advances in Asian trade Gold improved its position in Asian trade Monday, hovering near its highest level in almost four months hit last week, as record high exchange-traded fund holdings suggested flight-to-safety buying was gaining pace. Investors buy gold as a hedge against inflation, and fears of military confrontation between Iran and Israel have helped send oil prices to lifetime highs. Volatility in equities and currency markets also drives investors into safe-haven gold.
Egypt to produce 8 tonnes of gold in 2009 Egypt, which stopped gold production in 1958, will produce 8 tonnes of the metal from mines in the eastern desert in 2009, the chairman of the Egyptian Geological Survey and Mining Authority said on Monday. The Arab world's most populous country, which once considered gold the skin of the gods, is revisiting ancient gold deposits, some unworked for 2,000 years. "We have been producing gold since last December and one of the mines that started production has a reserve of 13 million ounces of gold," Hussein Hammouda said. "Once this mine is fully operational, it won't be only one of the biggest in Africa, but rather one of the biggest worldwide," he told Reuters in a telephone interview from Cairo.
Iran says discovers oil field in its southwest TEHRAN: Iran has discovered a new oil field holding an estimated 233 million barrels of recoverable sweet oil, Oil Minister Gholamhossein Nozari said on Sunday. The field, which has in-place reserves of 1.1 billion barrels, lies in the oil-rich southwestern province of Khuzestan, north of the city Andimeshk, state television quoted Nozari as saying. Iran, the second-largest producer of the Organisation of the Petroleum Exporting Countries (OPEC), two months ago put its oil reserves at around 136 billion barrels. Iran is a big producer of sour oil with a higher sulphur content than sweet crudes. Sour oil sells at a discount to sweet types.
Citigroup's $1.1 Trillion of Mysterious Assets Shadows Earnings At an investor presentation in May, Citigroup Inc. Chief Executive Officer Vikram Pandit said shrinking the bank's $2.2 trillion balance sheet, the biggest in the U.S., was a Nowhere mentioned in the accompanying 66-page handout were the additional $1.1 trillion of assets that New York-based Citigroup keeps off its books: trusts to sell mortgage-backed securities, financing vehicles to issue short-term debt and collateralized debt obligations, or CDOs, to repackage bonds.
Subprime Crisis Again in the Spotlight as the Meltdowns of Fannie Mae and Freddie Mac Fuel Fears of a Deeper Downturn We've been warning you since the start that the subprime crisis would have some real staying power. Indeed, every time optimistic prognosticators have predicted an end to this global financial debacle, we’ve had the same response: Don't you believe it. Again just recently, after several big banks announced yet another round of major write-offs - all of them related to the subprime crisis, albeit indirectly - analysts, and even some banking-industry executives, said the write-downs were coming to an end.
Iran Attacking Dollar, Switching to Euros in Oil Trades Iran plans to switch from dollars to Euros on the country's oil trading market, a move that could weaken the dollar, whose value has fallen sharply the past year. "Iran has really gone and done it now," commented the Saudi Gazette. It wrote, "The consequences are horrendous: with the dollar no longer the sole currency with which to trade oil, its credibility as the benchmark has weakened gravely and thrown all world currencies into a tailspin."
Iran's propaganda campaign Once again, the government of Iran is deliberately stirring up trouble in hopes of winning concessions from oil-hungry nations. Last week, Iran released photographs and video footage of what Tehran said were test-firings of several ballistic missiles. The launches were reported by Iran's state media to have included Iran's newly improved Shahab-3 surface-to-surface missile, which, with an extended range of 2,000 kilometers, puts Israel and much of the oil-producing Middle East within Tehran's crosshairs. This saber-rattling by Iran, which possesses the world's fourth-largest proven oil reserves, has sent the price of crude oil shooting up once again after a brief respite. This is precisely the effect that Iran's belligerent leadership intended to achieve, since the world is more sensitive than ever to soaring oil prices. By making trouble and getting away with it, Tehran can show that it has improved its bargaining position and might even be allowed to keep its nuclear development program going.
Assad: Israel to Pay 'Heavy Price' if Iran Attacked Syrian strongman Bashar Assad warned Monday that a military attack on Iran would have dire results for Israel. Speaking on France's InterRadio, Assad said: "Iran has already noted that Israel will pay a direct price for such an attack." "The problem," he explained, "is that when one side initiates such an operation in the Middle East, it will not be possible to control the repercussions which could influence the region for many years afterwards." Regarding the United States, Assad said that while reason dictated that the Americans should not strike Iran, "Bush's administration seeks war. It does not act in accordance with our logic and with that of most European states and the nations of the world."
Oil hits new high, metals shine Oil prices zoomed to a record $147.50 this week and aluminium hit all time highs as many commodities were boosted by supply worries, growing tensions over Iran and the weak US currency. Commodity prices swung higher ... as increased tensions between Iran and the West triggered fresh safe-haven demand for oil and metals, said James Moore, analyst at TheBullionDesk.com. Dollar weakness also provided upside momentum he said. The struggling dollar boosts demand for dollar-priced raw materials which become cheaper for buyers using stronger currencies.
Iran to "cut hands" off any attacker, president says Iran's president said that even before its enemies "get their hands on the trigger" the country's military would cut them off, media said on Sunday, in a growing war of words that has intensified Middle East tension. But President Mahmoud Ahmadinejad also suggested Iran would consider any proposal by the United States for a U.S. interests section in the Islamic Republic, if it was forthcoming. The two countries have not had diplomatic ties since 1980.
OPEC Warns War With Iran Would Cause 'Unlimited' Oil Price Hike World energy needs will spike by more than 50 percent by 2030 but adequate oil reserves, conservation and new methods of recovery mean supply will keep pace with demand, the Organization of Petroleum Exporting Countries said Thursday. Still, OPEC's secretary general acknowledged that dangers to steady supply exist. Addressing one — the threat of a U.S. or Israeli attack on Iran because of its nuclear defiance — he warned that his organization was unprepared - and unable - to make up for resulting oil shortfalls. "It is impossible to replace the production of Iran," OPEC's No. 2 producer, Abdalla Salem El-Badri told reporters at the presentation of the organization's long term oil market outlook. “The prices would go unlimited ... I can't give you a number."
US Treasury rescue for Fannie Mae and Freddie Mac Treasury secretary looks at $15 billion cash injection for crisis-hit mortgage lenders US TREASURY secretary Hank Paulson is working on plans to inject up to $15 billion (£7.5 billion) of capital into Fannie Mae and Freddie Mac to stem the crisis at America’s biggest mortgage firms. The two companies lost almost half their market value last week as rumours of a government bail-out swept the stock markets, hammering share prices around the world. Together, the two stockholder-owned, government-sponsored companies own or guarantee almost half of America’s $12 trillion home-loan market and are vital to the functioning of the housing market. The capital-injection plan is said to be high on a list of options being considered by regulators as a means of restoring confidence in the lenders. The move would protect the American housing market, but punish shareholders in both companies.
The $5 trillion mess Fannie Mae and Freddie Mac were created by Congress to help more Americans buy homes. Now their shaky condition threatens the entire housing market. They own or guarantee $5 trillion worth of mortgages? - nearly half of all the country's outstanding home loan debt-and they're crashing. Big time. Fannie Mae and Freddie Mac are struggling with an investor loss of confidence so great that, while they're unlikely to go under, they could conceivably see their ability to function impaired. That would wreak yet more havoc on an already wrecked housing market- making loans tougher to come by and possibly pushing hundreds of billions of dollars in cost onto U.S. taxpayers. How could the companies end up in such awful straits? Given the way they were created and run, a better question might be: how could they not?
Freddie Mac's Next Hurdle: Raise Cash Treasury Working to Make Sure Debt Sale Succeeds Unlike the situation facing Bear Stearns earlier this year, Fannie Mae and Freddie Mac are not short of cash. Treasury Department officials were working the telephones yesterday to make sure that Freddie Mac, one of the nation's two troubled mortgage giants, will be able to sell $3 billion of its securities tomorrow in a previously scheduled sale that has now become a crucial test of investor confidence. Though officials said they were optimistic the sale would be a success, anything less would pose new questions about how far the federal government is willing to go to prop up Freddie Mac, its sister Fannie Mae and other faltering financial enterprises. Officials spoke yesterday with major banks that normally purchase securities, like the short-term debt offered by Freddie, to ensure these firms still plan to place bids tomorrow. This was part of an effort by officials at Treasury, the Federal Reserve and other agencies this weekend to gauge market sentiment and check that investors still have faith in Freddie Mac and Fannie Mae after the steep decline in their stock prices last week.
Fannie and Freddie Grew, Protected by Washington As the Bush administration scrambles to address the sudden decline of the country’s two largest mortgage finance companies, some of their longtime critics say the crisis has been building for years. Among them is Jim Leach, a Republican former representative from Iowa, who began arguing two decades ago in Congress that the government-chartered mortgage companies, Fannie Mae and Freddie Mac, were unfairly insulated from the real world. They were not subject to the same financial standards and tax burdens as their competitors, he warned, and if they ran into trouble, an implicit government guarantee to back them up meant taxpayers would be left with the losses.
Obama cautious on steps to help Freddie/Fannie Democratic White House hopeful Barack Obama said on Saturday he was confident "prudent steps" by the U.S. government would stabilize mortgage giants Fannie Mae and Freddie Mac but that it was necessary to see how the situation developed before deciding on what steps to take. In his first comments on market turmoil over the two companies, Obama told reporters on a flight to San Diego that he was monitoring the situation of the two institutions closely and that it was of "extraordinary concern."
The fall of IndyMac Feds seize bank - once a leading mortgage lender. It may turn out to be most expensive collapse ever. One thing is sure: The credit crisis is still with us. In what could turn out to be the most expensive bank failure ever, troubled mortgage lender IndyMac Bancorp Inc. was taken over by federal regulators on Friday. The operations of the Pasadena, Calif.-based thrift - once one of the nation's largest home lenders - were shut down at 3 p.m. PDT by the Office of Thrift Supervision and transferred to the Federal Deposit Insurance Corp. About 95% of the $19 billion in deposits in the bank are insured, but that leaves $1 billion that was not covered by FDIC guarantees. According to the agency, 10,000 IndyMac customers could lose as much as half of that amount, or $500 million. The agency says the failure will cost the Deposit Insurance Fund between $4 billion and $8 billion, based on preliminary estimates.
---------------- over the weekend ------------------
Dollar Plunges on Fannie Mae and Freddie Mac Scare The dollar was sharply lower versus other key currencies Friday after mortgage lenders Fannie Mae and Freddie Mac saw their stocks plummet on fears they may have to be nationalized for a lack of capital. US Treasury Secretary Henry Paulson offered no hint of a bailout but said the government would work to help the companies recover in their current form. “Today our primary focus is supporting Fannie Mae and Freddie Mac in their current form as they carry out their important mission,” Paulson said. Stocks pared some losses after a Reuters report that Federal Reserve Chairman Ben Bernanke had told Freddie Mac CEO Richard Syron that the two government-sponsored enterprises could access the discount window.
Widespread Panic Fannie, Freddie, Lehman, oil, stocks: How Wall Street became paralyzed with fear. Nearly a year into the credit crisis and four months after Bear Stearns imploded, panic has officially set in on Wall Street. This week was a maelstrom of fear across the board. The Dow Jones industrials officially hit bear market territory, Iranian missile tests helped drive the price of oil to another record high, rumors and anxiety sent shares of Lehman Brothers so low that its name is nearly synonymous with Bear Stearns, and the two most important players in the mortgage market, Fannie Mae and Freddie Mac, appeared to be on the brink of becoming obsolete. Investors have every right to be nervous. And the scariest part is there are no signs of abatement anytime soon. Panic only begets more panic. The cliff dive that Fannie and Freddie shares took this week is particular cause for alarm. The government-sponsored entities borrow money at favorable rates in order to buy and repackage mortgages from issuing banks, thus freeing up the banks to make more loans. They then sell those repackaged securities as bonds and guarantee they'll be repaid. It's nearly impossible to overestimate their importance to the function of the capital markets - they're the grease that keeps them running. They back or own more than half of the country's $12 trillion mortgage debt.
Paulson Backs Fannie, Freddie in Their 'Current Form' U.S. Treasury Secretary Henry Paulson signaled that a government takeover of Fannie Mae and Freddie Mac won't be necessary, saying they should continue as shareholder- owned companies with federal charters. "Today our primary focus is supporting Fannie Mae and Freddie Mac in their current form as they carry out their important mission,'' Paulson said in a statement in Washington. President George W. Bush told reporters separately that the two firms are "very important institutions'' and that he discussed market "concerns'' with Paulson earlier today. Paulson's remarks indicate he wants to reassure shareholders they won't be wiped out by any government efforts to ensure the stability of the firms that own or guarantee almost half the $12 trillion in U.S. mortgages.
Nervous Investors Bid Up Gold Prices Gold prices were surging Friday as worries about the financial system combined with higher oil prices and tensions in the Middle East to boost demand for the metal. Benchmark bullion futures were gaining $23.90 at $965.90 an ounce in recent action on the Comex division of the New York Mercantile Exchange. The dollar was retreating against the euro, the British pound and the Japanese yen. The price of dollar-denominated assets, such as gold, tend to rise as the value of the U.S. currency drops. "There are any number of reasons for people to be concerned about the world, and investors are responding by purchasing large amounts of gold and silver," says Jeff Christian, managing director at New York-based specialty commodities research firm, CPM Group.
5-Alarm Fire at Fannie, Freddie: Paulson Nixes Bailout -- for Now Fannie Mae and Freddie Mac tumbled again Friday as speculation about possible government intervention accelerated, thanks to a NY Times story on the subject. Hopes for a government bailout rose further - and stocks climbed from their initial descent - on reports Treasury Secretary Paulson would make a statement on the GSEs. But the optimism proved misplaced. Paulson downplayed the likelihood of a government bailout of Fannie and Freddie, and financial markets tumbled anew. "Today our primary focus is supporting Fannie Mae and Freddie Mac in their current form as they carry out their important mission,'' Paulson said in a statement.
Silence of the Lenders: Is Anyone Listening? DAN A. BAILEY JR. was desperate when he sat down on May 19 to send an e-mail message to his mortgage lender, the Countrywide Financial Corporation, pleading, yet again, for help. Behind on his payments and fearful of losing his home of 16 years — a 900-square-foot bungalow in Wilmington, N.C. - Mr. Bailey had spent the previous six months unsuccessfully lobbying Countrywide, at the time the nation’s largest home lender and loan servicer. Mr. Bailey, 41, promised in his e-mail message that he would pay every nickel he owed if Countrywide would modify his mortgage in a way that allowed him to keep his home. He sent the message to a grab bag of Countrywide e-mail addresses, which he had received from www.LoanSafe.org, an online forum for borrowers. Among the recipients of his e-mail was someone he had never heard of before: Angelo R. Mozilo, Countrywide’s co-founder and chief executive. Lo and behold, Mr. Mozilo replied — inadvertently, as it turned out.
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