LOS ANGELES, Sept. 7, 2007
Countrywide To Ax As Many As 12,000
Struggling Lender Announces Massive Cuts Amid Changes In Mortgage Industry
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(AP)
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The company said the cuts, amounting to as much as 20 percent of its work force, are needed because it expects new mortgages to fall about 25 percent in 2008 from this year's levels.
The job cuts are expected to center primarily on the company's production divisions and its general and administrative support areas, Angelo Mozilo, Countrywide's chairman and CEO said in a letter distributed to employees Friday. He also called the current market cycle "the most severe in the contemporary history of our industry."
"During the past two years, the growth in home price appreciation has stopped dead in its tracks and in many areas of the country it has turned in the wrong direction," Mozilo said in the letter.
He also said he expects the loan origination market next year to be down 25 percent from this year's volumes.
In recent weeks, the company borrowed $11.5 billion and sold a $2 billion stake to Bank of America so it could keep operating its retail banking and mortgage lending businesses.
The Calabasas, Calif.-based company said it intends to keep transferring its residential lending business into its Countrywide Bank unit as a way to strengthen its access to funding.
Almost all of its residential lending activity will be originated through the bank by the end of this month, the company said.
The company has shifted its loan production guidelines and now only makes loans that can be sold on the secondary market, such as to government-backed enterprises like Fannie Mae or Freddie Mac, or which qualify under the investment requirements for its banking unit.
The latest cuts followed the elimination of about 900 positions earlier this week and 500 others last month.
The company employs about 60,000 people, with around 34,000 in loan production.
Countrywide has been struggling as the housing slump led to a sharp rise in mortgage defaults and foreclosures, particularly among borrowers with subprime loans.
Like other lenders, Countrywide has tightened its credit guidelines and stopped selling some types of adjustable rate loans.
"As we carry out our plan, the company's overarching focus is exactly where it has always been: to remain an industry leader in the U.S. residential lending business," Mozilo said in a prepared statement.
The company declined further comment.
© MMVII The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.
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- People refer to housing as a buyers market or a sellers market. What is never acknowledged is that the majority of people in the market are both buyers and sellers. The only ones who ever benefit from an up or a down market are old folks moving from their house to apartment/nursing home (sellers market) or young folks moving from an apartment into their first house (buyers market). If you are moving from one house to another, you%u2019ll always get screwed in one of the two deals.
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- RE : my2centss
There will be a full Repercussion of more job Losses.
If you think for one moment - Mexican Truck Drivers
Are going to patronize - American Truck Mechanics
You''re "Nuts"
If you think for one moment - Mexican Truck Drivers
Are going to patronize American Truck Body shops.
Buy American Tires -Truck parts ... ect
"You''re Completely off your Rocker"
The whole Consensus is to : Destroy the Middle Class Income
For decades the Middle Class and the entire Infrastructure
of the Wealth within the United States rested upon the :
Autoworker and Steelworker
In the 1950s :
Sen. Prescott Bush
The Heads of the big Three Auto Manufacturers
US steel
Began investing in the Japanese Auto Industry.
If they couldn''t get Rid of the Labor Unions and
The labor Union wage and benefit package.
They would get Rid of the Product - that Sustained and
Supported the Infrastructure of the Middle Class
Wage and Benefit package
Then they started with their - Propaganda Campaigns -
Against the Labor Unions
They did it so often and along with the help and the
Assistance of the news media.
The American people actually taught themselves
To Believe it. ! ! !
Lastdance - Reply to this comment
- Topic : In gold we trust
Source : Asia Times Online
09-08-07
Central banks in the US and Europe
have lost credibility with investors. They are no longer
trying to prevent inflation, but appear more concerned
with preserving the lot of bankers. This suggests greater
value destruction for global investors,
Neither the US dollar nor the euro has any credibility in
this situation, which means that the average Asian saver
has no option but to purchase gold as a store of value.
Even as US dollar bills proudly carry the motto
"In God We Trust",
It is time for Asians to put their trust in gold instead.
Topic : In gold we trust
Source : Asia Times Online
09-08-07
Lastdance - Reply to this comment
- and the idiot in dc gw bush said the other day our economy is the most robust in his life time every one was working and not lay offs with less than 4% unemployment well here is 12000 more to the 40,000 that they talked about on news tonight. Yeah he will think robust in two years when he needs a job and even the letuce pickers will not hire him or his wife. The reason; he has allow too many ******** and illegal aliens in to do the job saying American farmers need them. the best of good byes from austin, tx and frank bowers.
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- "...and it will definitely get worse... and the Mexican truckers cause layoffs in the US trucking industry.
Posted by brianbwb at 04:27 AM : Sep 08, 2007
That will not do too much to affect the unemployment claims. Lots of truckers are independent contractors, own their own trucks, and not eligible for benefits. - Reply to this comment
- The housing/mortgage bust of the late 2000s, will be a repeat of the dot-com/tech bust of the early 2000s.
Sadly, far more people, mostly of the middle class, will suffer far greater than we did during the dot-com/tech bust just a few years ago!
History is repeating itself far too soon. A recession, then possibly followed by a major terrorist attack....
...the big question is, how many more freedoms will Americans so glibly turn over to the government in the near future if history does repeat itself exactly as it did six years ago?! - Reply to this comment
- "The 4,000 jobs cut in August are from both private and government employers. The government actually cut 28,000 jobs, while all private employers added 24,000."
It doesn''t escape notice that the above statement was in the news a few days ago, now this one appears. So now were at -16,000 job creation for August-September, and it will definitely get worse as those summer jobs trumpeted by the Bush administration a couple of months ago disappear, and the Mexican truckers cause layoffs in the US trucking industry. - Reply to this comment
'' ... i miss being three and six years old, and watching all my naked lazy ignorant profane blemished savage friends being made to disappear forever ... they should do a show about that ... ''
'' ... most folk most time don''t really dance porno get sick tax world get well feed world songs rallied round the tens millions sick beds drifting the tens millions farm trail groups ... ''
'' ... lazy naked ignorant profave blemished savage folk never really go away, they just get stuffed in a closet somewhere and never see the light of day ... ''
'' ... some mean girls with bombs came and said to the big men: give us all your lazy naked ignorant profane blemished savages or else, and the men shrieked: take them, their yours! ... ''
'' ... giving away free market share to entreprenuers for small tips is the ultimate capitalist adventure ... ''- Reply to this comment
- This smells like the tech bubble burst of 2000.
Could be a tough economic period in front of us. - Reply to this comment
- Countrywide was doomed at the beginning. I attempted to get a loan through them and it seemed I did all the chasing around trying to get them to call me back. After several unanswered messages to their internet sales guy (P.N.), I gave up. I have a 710 credit rating and my wife 755 so I know it was''nt our credit. They were disorganized with their business practices to begin with.
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