A Very Short Play In One Act: How Bank of America Decided To Save CFC

| About: Countrywide Financial (CFC)

Scene: An executive suite at Bank of America. A phone cheeps softly, and is quickly answered.

Assistant: Certainly sir. (Calling out): Mr Bofa, it’s your boss, Fred Reserve, on line 1, he says it’s urgent.
Bofa: Oh [expletive deleted]. Not Fred. OK, I'll take it, damn and blast.

Fred: Hey Bofa, I need to call in a marker.
Bofa: Uh oh.
Fred: Listen you’ve been bad, you got off light, and we even finagled the stats to get you over the 10 percent hump with that last acquisition.
Bofa: Yeah I guess so, but honestly, mutual fund timing wasn’t our fault. And anyway, it was the SEC that let us off...
Fred: Shut up. So anyway, congratulations, you are investing $2 billion in Countrywide (CFC) since they are effectively insolvent and we can’t have a huge bloody mess on our hands with Rambling Al’s book tour next month.  And Angelo Mo’Sella still has a bunch of the money options to get rid of. Also this fits right in with your core strategy.
Bofa: You mean to be as big as possible?
Fred: Yes exactly.  Also for you, $2 billion is child’s play.  Be prepared to lose another $2 billion.
Bofa: Do I have a choice? Couldn’t I have WaMu instead?
Fred: Hmmm, do I see an audit coming up next month? With Ace Proctologist, our chief examiner, out of valium and lining up the scope on how you’re marking the dreck in your bond funds?
Bofa: Ok, understood. It’ll take us an hour to run up the press release.
Fred: Make it 15 minutes. (Click).

Very slightly adapted from an idea by Dave Derivative, a special advisor to the NakedShorts Family Office.

BofA invests $2 billion in Countrywide
Mortgage lender's shares surge 17% in late trading on Wednesday
by Alistair Barr
MarketWatch Aug. 22 2007