COUNTRYWIDE POSTED its first quarterly loss in 25 years on $2.27 billion in mortgage losses and write-downs and soaring credit-loss reserves. But...

the lender expects to be profitable in the fourth quarter. I don't know about this. Countrywide is taking in more overvalued, underwater residential property in a the midst of a massive residential slowdown, than any other entity that I know of in America. In addition, they have significantly shrunk their business so it will be hard for them to earn their way out of this. Mortgages sales volume and size will decrease since home sales are decreasing amid shrinking housing values, and thier business model is going conforming.

What is CFC going to do with all of those significantly devalued mortgages on their books? What are they going to do with all of the increasing foreclosures coming down the pike? They already wrote many billions of dollars of bad loans, and now they are taking loads of zero equity property in as well. What are they going to do with those? If you think the homebuilders have written down the value of their assets significantly, imagine the competition they will get from Countrywide. Hey, I am being pessimistic, let me take a close look at their numbers before I jump to conclusions.