The Garrett, Watts Report (June 27, 2008)

June 27th, 2008 · 1 Comment


Special note: Contact Joe Garrett to receive 3 special attachments:   1  Ten Keys to Survival, 2.  Being Small, and   3. FHA Card

To Our Clients, Colleagues and Friends:    

· We spoke with a co-owner of a good sized mortgage company which had gone through a near-death experience earlier this year.  His big lesson learned?  If we can’t afford to pay cash, we’re not buying it. There’s a time when using debt makes sense, but we found his comment interesting and one that’s hard to argue with.  He added that debt is slavery, and yes, if you have no debt, you have many more options.  One other way to phrase it, and we’ve been telling clients this for years, is that cash is king and that building liquidity is always a smart thing to do.

· A reader at Indy Mac Bank told us that Cow Pasture Bank is no more.  Wells Fargo bought them and shut down the airstrip!  Wells is probably the best bank in the country, but how could they do this?  Having an airstrip for depositors was about the coolest thing in the world. Dick Kovacivich, have you no sense of cool?

· How many passwords do you have for various websites, ATMs, etc.?  It had gotten to the point where each of us had way too many passwords, so we started, and just finished, a tedious process of changing them all to the same password.  Memorizing ten different passwords just doesn’t work.

· This is probably as irrelevant a statistic as you’ll see this week, but did you know that virtually 100% of all FHA are loans are securitized soon after they’re originated? Along with all the reasons for holding an MBS rather than a whole loan. we can think of only one reason.  And that’s that GNMA will only securitize new loans and not seasoned loans.

· On This Day in History, June 27th 1967, the world’s first ATM was installed in London . Banking is not terribly innovative, but ATMs must rank as one of the great innovatio