Countrywide Receives $12 Billion in Credit - Market Up

Countrywide announced today it had received $12 billion in credit financing, helping it avert any kind of liquidity crunch. The market responded positively.

Countrywide announced today it had received $12 billion in credit financing, helping it avert any kind of liquidity crunch.  The market responded positively. 

"It appears that this credit crunch may not be as bad as some people thought," said Charles Norton, principal and portfolio manager at GNICapital.  I don't know who Mr. Norton is and haven't heard of GNICapital but he echoes a sentiment I've made earlier.  Namely, that things were not as bad the media was saying.

Of course, I do believe that there is a lot of pain happening to individuals and quite a few will lose their homes.  That's very unfortunate.  But I still don't think it's going to lead to the next depression.

All markets were up on this news as well as advanced by GM and McDonald's, which hit an all-time high.

We continue with our Fed watch.

Sam Cass
Sam Cass: Sam Cass, MBA, JD, University of Texas at Austin. Always a fan of Leonardo Da Vinci.

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Comments

  • JTerranian

    September 14, 2007

    Wall Street seems willing to do whatever it takes to bail out Countrywide. They aren't investing in this because they think it is a good investment. They must have decided that they need it to survive. Either than or Mozilo has dirt on someone important.

  • seaver

    September 18, 2007

    We are still in the early innings. Countrywide and the rest of the mortgage lenders have several more legs down to contend with. This isn't a hiccup in real estate values, it is going to be a pronounced resetting to levels closer to those from 7 years ago than to 1 year ago.

  • William Li

    October 03, 2007

    Countrywide is about due for another big fall. Stay away.

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