dan clue

E*Trade Financial: Laying the Foundation for Success

What you failed to mention is as of last year Etrades mortgage portfolio is 11.8 Billion. Etrade perdicts that they will write down 1.5 billion over the next 3 years. This doesn't seem like alot of money, it appears that more people are paying than defaulting building up equity in their homes. Also Etrade put aside $600 million on the side at the end of 2007 and anticipating the first half of 2008 they said they would put an additional $400 million on the side to cover additional defaults for 2008. So basically over the next 3 years they will write off an additional $500 that wasn't anticipated. This doesn't seem at all bad and the mortgages that default will have soom book value when the homes of the defaultees are sold. This will be additional money coming into Etrade thats not baked into the figures.