The Wall Street Journal broke a great (and by "great," I mean "pathetic") story about the PR campaign launched by lousy-lending poster child Countrywide Financial
Blame-shifting, throbbing forehead veins, and shout spittle
Heading up the effort for Countrywide is former pro football player Drew Gissinger, an executive of residential lending, who is flooding the campaign with testosterone-laden, locker-room nonsense worthy of an Office Space sequel, like this gem: "Growing, winning and being the best is also hard wired into our DNA." (The WSJ posted a transcript here.)
One laughable takeaway: This is the media's fault. But no worries! Countrywide is going "back on the offensive," with its new "attack strategy" the first week of October. The plan also includes the usual pep talks, along with some puddle-deep, team-building paranoia, in the form of copious verbiage about being "attacked" and responding with a "crusade." It also features creepier measures; employees who take a loyalty oath get rewarded with green rubber "Protect Our House" bracelets. (Quick suggestion for Countrywide: Send these to customers instead. Putting one of these on the doorknob of a home facing foreclosure might keep the deputies at bay for a day or two.)
Finally, as you might expect from an agitated ex-jock reading a script on behalf of the pugnacious son of a butcher, there's bellowing aplenty. Not to mention shallow exhortations to individual pride, like the battle cry, "NOW IT'S PERSONAL."
Right, but off by 180 degrees
Countrywide CEO Angelo Mozilo -- the aforementioned butcher's son -- might be right about things being "personal," but he's completely misguided on the identity of the victims in this story. It ain't Countrywide, and it ain't Mozilo.
But for all those poor souls that were bum-rushed into risky loans during a dangerous housing bubble, and who may lose them as interest rates reset, this is now intensely personal. There are few things more personal than the danger of being tossed out of your home because you can't afford the gimmicky loan you little understood, and whose risks you weren't prepared to assume.
But you're not fooling anyone, Mr. Mozilo. We know exactly what you did during this bubble: You fanned the flames while cashing out hundreds of millions of dollars, leaving everyone else holding the bag, including 12,000-plus employees who are getting the ax while you enjoy those millions. Then you sent your firm, hat in hand, to Bank of America
The American Dreamworld
Countrywide claims to have a social mission to "lower the barriers to home ownership." That's no different from the lip service the rest of the industry has given to its ridiculous concoction of home ownership as "the American dream." This marshmallow-fluff marketing tactic has simply been a cover for creating "affordability products," gimmicky option loans designed to make overpriced houses seem less expensive until such time as they could be flipped, at a profit, to the next sucker in line. (When they can't, the "American Dream" becomes a nightmare; renting from a bank at high prices is much worse than renting from the usual landlord.)
As I've pointed out before, this giant housing Ponzi scheme worked fine when money was flowing to mortgage lenders in unlimited quantities, and when there were bidding wars for unfinished homes from D.R. Horton
Foolish final thought
The problem at Countrywide isn't a lack of pride; it's an excess, especially in the boardroom. It seems that Mozilo's ego won't let him admit that the party is over. And as the guy who shouted the loudest, and stood on the coffee table with a lampshade on his head the longest, he richly deserves the hangover. The tragedy is that homeowners, employees, and shareholders are suffering the worst of his headache.
I think that if Mozilo had any real pride, he'd plow his hundreds of millions back into the company and promise not to sell a single share until the market was right, and employees and borrowers had security. I won't hold my breath.