Mobile Here are some notes worth consideration.
* In Rev. Orange’s Times obituary to my surprise there was a large piece on his time with us on the HOTRC campaign in New Orleans: “Five years earlier, Mr. Orange had gone to New Orleans to work on a campaign to unionize thousands of housekeepers, banquet waiters and laundry-room employees working in the city’s hotels. It reminded him of his days in Memphis, in 1968, when he marched with Dr. King in support of sanitation workers. ‘The workers I saw in Memphis in 1968 were better off than the workers I see here in 1998,’ Mr. Orange told The New York Times during the New Orleans campaign.”
* In a story by Edmund L. Andrews and Louis Uchitelle in the Times there was an estimate that 8.8 million homeowners or 10.3% of all homeowners are “underwater” meaning that they owe more in mortgages for their houses than the houses are worth in value in the market. The reporters indicated that this number was double the percentage of 1-year earlier according to Moody’s Economy.com. Banks seemed to be looking for a bailout strategy if they can find one in order to keep from experiencing more write-offs. Whether they like it or not, it seems more likely that they are going to need to start accelerating write-offs of principle and interest to right size prices and mortgages and let homeowners get out from under the burden before people start simply walking away.
* GMAC, one of the major companies with whom we are currently trying to negotiate a best practices servicing agreement, has experienced another credit rating decline because of the problems with the Residential Capital mortgage unit and its subprime business. Standard and Poor’s lowered the rating of GMAC to B+ from BB+, while ResCap went from BB+ to B. ResCap borrowed $635 M from GMAC in this crisis. Trouble everywhere in this mess!
* In the Wall Street Journal Bank of America announced that it was going to make David Sambol, Countrywide’s President and Chief Operating Officer, in charge of their combined mortgage business. Bank of America with the purchase will lead the market in US home mortgages with 20% of the total. The wags seem to say that B of A is going to be pulled down by Countrywide.
These are the days.