To Our Clients, Colleagues and Friends, 

· Of all the stuff we get on the state of the economy, just about our favorite is the report put out by Comerica’s chief economist.  Very concise.

· We got the most interesting note from MIAC a few days ago about their hedging services.  If you’re looking for such a service, you definitely need to include them in your search.  Same with Secondary Interactive.

· We wrote about Bob Gibson last issue, and here’s what Hank Aaron had to say about him:  “Don’t dig in against Bob Gibson or he’ll knock you down.  He’d knock down his own grandmother if she challenged him.  Don’t stare at him, don’t smile at him, and don’t talk to him.  He doesn’t like it.  If you happen to hit a home run, don’t run too slow, and don’t run too fast.  If you want to celebrate, do it in the clubhouse. And if he hits you, whatever you do, don’t charge the mound.”  We spoke with Willie Mays once, and he said he never dug in against Gibson.  “It just made him even angrier.”  Here’s a rare photo of Gibson actually smiling.

· We sent the above quote (”Don’t stare at him, don’t smile at him, and don’t talk to him……”) to a friend who wrote back, saying “My wife shares some of those same  characteristics.”

· From a SoCal mortgage banker: “Last month we funded $29 million on our $15 million line, and our oldest loan is 11 days old.  I have the best closing and shipping department on the planet, and they keep me in business.” Amen to that.  Production seems to be taking care of itself these days, so the real emphasis needs to be on closing, shipping, and staying on top of trailing docs.

· We got some interesting responses to who you’d like to have dinner with:   Jesus Christ, George Patton, Churchill, Julius Caesar, Sarah Bernhardt, Ronald Reagan, Frank Sinatra, Monet, Voltaire, Abe Lincoln and George Washington, Hitler and Stalin, LBJ, Mark Twain, Daniel Webster, Socrates and Aristotle. Also Martin Luther, Martin Luther King, Freud, Elvis, Shakespeare, Beethoven, Marco Polo, Teddy and Franklin Roosevelt, Thomas Jefferson, Bonaparte, Peter the Great, Rousseau, Wilt Chamberlain, Johnny Carson and Jay Leno, Muhammad, Muhammad Ali, Buddha, Mao, Lenin, and Ayn Rand. Finally, Joan of Arc, Fred Astaire, Barack Obama, Michelle Obama, Benjamin Franklin,  St. Francis of Assisi, Moses, Sandra Bullock (!), Toulouse Lautrec, Gandhi, Davey Crockett, Oscar Wilde, Al Pacino, George Shultz, Margaret Thatcher, Bill Clinton, Patrick Henry, Lord Nelson, Babe Ruth and Lou Gehrig.  What interesting people! We got about 60 names, so you could have one dinner-guest a week for a whole year.

· Succession planning again:  Someone just reminded us of a company we knew well.  There were three owners, one being the largest shareholder by far.  When he died unexpectedly of a massive heart attack, his widow got his stock and decided to get active in running the company.  She knew nothing about mortgage finance, and it was probably no coincidence that the company failed within a few months.  A succession plan with Key Man life insurance would have prevented this.  By the way, we know an insurance company (Sweet & Baker) which has a full-time specialist in succession planning.  Let us know if you’d like a name and number.

· You know how smaller banks are always being gobbled up by larger banks? Last week, a $251 million bank in Alabama bought a near-by $636 million bank.

· Mortgage software company PC Lender is looking for an account manager.  If you’re interested, you should contact Stephanie Durfinger at [email protected].  The cool thing about them is that they’re based in Hawaii , so if you need to visit the home office, well, it’s in Hawaii .

· Remember a few years ago when we’d share palindromes, those sentences that read the same forward or backward?  Here are some favorite oldies:  Never odd or even.  Was it a car or a cat I saw?  Ma is as selfless as I am, and for those who don’t like faux Hawaiian music (and tiny bubbles), Oh no, Don Ho!   Ashwin Adarkar always had the best ones.

· In a way, loan officer compensation has been dropping on its own.  Gone are the days where they could pick up a 2-3 point overage on a 105 Option Arm.  But we still think commissions are too high.

· Temecula Valley Bank has raised private capital (the good news), but it was 95% dilutive (the bad news).  But like the Lieutenant who said during the war in Vietnam that, “We had to destroy the village to save it”, at least the bank will live to fight another day.  Temecula was and probably will be again one of the nation’s top SBA lenders.

· Last week we said that Oscar Robertson was better than Michael Jordan.  Oscar’s stats may have been better, but as several dozen of you reminded us, no one was as good as Michael. Especially when it mattered!

· Wow, Hollywood is making movie about our favorite team, the Oakland A’s and their General Manager, Billy Beane.  How about that?  Beane will be played by Brad Pitt.

· Billy Beane once told us he doesn’t believe in team chemistry.  “Have you ever noticed that winning teams always have chemistry and losing teams never do?  Give me any team that wins its division and people will say they have good chemistry.   Winning does that to you.”

We like the quote at the top:  “I have the best closing and shipping department on the planet, and they keep me in business.” This guy knows that it’s the back-office than can make you or break you.

Joe Garrett and Corky Watts  -   Garrett, Watts & Co.    -  510-469-8633   

“Helping mortgage lenders increase revenues, control costs, and better manage risk.”