The Garrett, Watts Report (July 4, 2008)

July 3rd, 2008 · 1 Comment


To Our Clients, Colleagues and Friends:   

· Now we know what mortgage banking guys are really thinking about.  Last week we mistakenly noted that Pam Anderson had turned 51.  Well, we got dozens of e-mails from readers correcting us that she was only 41.  Aren’t you guys supposed to be out selling loans or something?  Hey, 41 or 51, she’s still great looking.  

· Charles Schumer, how about pontificating on things you know something about?

· This week was the 45th anniversary of, depending on your point of view, (a) the world’s greatest pitching duel or (b)  the world’s most boring game.  Juan Marichal of the S.F. Giants and Warren Spahn of the Milwaukee Braves dueled each other for 16 scoreless innings the first week of July in 1963. In the bottom of the 16th the Great One, Willie Mays, ended the game with a walk off homer.  Interestingly both pitchers tossed complete games four days later.

· With Countrywide no longer in the S&P 500 index, guess who took their place?  A steel company.  AK Steel Holding Co. to be exact.  As George Bernard Shaw once said, great things often end with a whimper and not a bang.

· Weird Bank Name Dept: Organizers applied with the FDIC to open a state-chartered de novo bank in Mankato , Minnesota .  The proposed bank, “Bank 182”, plans to set itself apart as “2 degrees more than completely different,” according to its Web site.  Sure sounds like a weird name to us.

· What are scratched and dented loans going for?  The best bids we have seen lately are around 70, and that’s assuming it’s a performing 1st lien loan that just has a flaw or two in the documentation. HELOCS or 2nds?  Lots of packages get no bids, some have gotten as low as 4-5, and we’ve heard of some getting as high as 20.

· One Less Thing To Worry About Dept: A year ago Prime was 8.25% - today it’s 5%.  A year ago the 30-day LIBOR was 5.32%, and today it’s 2.46%.  At least you’re making few dollars on your warehouse spread as opposed to losing money.

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