The Sunday New York Times takes a fascinating look at Countrywide Financial (NYSE: CFC) and Angelo Mozilo, the company's embattled CEO who is under SEC investigation and receiving widespread calls for his resignation. Mozilo has been declining interviews of late, but a Countrywide spokesman was there to provide Baghdad Bob-like assurances that Countrywide has great governance and Mr. Mozilo is a great executive. Right.
According to The Times: To this day, he says his beleaguered company did nothing wrong during the loose-lending craze that is now unraveling nationwide with record foreclosures and mountainous losses. Instead, Mr. Mozilo considers himself and his company to be victims of financial forces beyond their control.
You have to love that attitude: these executives have no problem paying themselves huge bonuses when things are going well, easy credit is driving up home prices and defaults are virtually non-existent. But the second the pendulum swings, these CEOs emerge as helpless victims of forces beyond their control.
The Times piece presents Mozilo as an imperial CEO, hellbent on increasing market share and building his empire -- even when his comments would appear to indicate that he knew the loans were no good.
Expect the calls for Mozilo's resignation to continue -- but the thing that really needs changing is the company's board of directors.
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Reader Comments (Page 1 of 1)
11-11-2007 @ 9:51PM
JHS said...
Country Wide Mozilo and Wall Street knew years in advance what would happen to the sub-prime loans--just follow the money trail-- they will all make billions off this legal scam
11-12-2007 @ 2:37PM
Americas Watchdog said...
We are Americas Watchdog's Corporate Whistleblower Center and we are deeply concerned about CFC & its CEO. However, we do not think the industry knew in advance of the real estate train wreck. We think that Wall Street was so intoxicated with greed that they failed to see the train wreck coming. Where CEO Angelo messed up was in October & December of 2006 when he changed his trading plans. We think in October Angelo & CFC realized they were standing in the heat lights & they were toast.
Almost just as good is CitiGroup & its real estate fall of the cliff. In their case they were not doing the loans they were buying the portfolios of CDO's. These portfolios were high yield but very high risk as well. Which brings us to we think Wall Street is the problem. No one thinks a year or two out anymore. They think about 10 minutes out. We also think the real estate markets nationwide will get much worse in 2008. This is not because interest rates or what the fed does but rather we think its a valuation issue. Too many homeowners owe more on their mortgage that their house is worth. It was never simply a "sub-prime issue", it was always a valuation issue. We do not give financial advice but if we had we would have out performed the market for the last two years. For those who will listen Financials & Homebuilders in 2008 will be radioactive. Check your 401-k's & get out of these if you have them.