Commentary - 01/15/2008

Bank of America Devours Countrywide

The most important point of the 1889 book, The Great Red Dragon, was their goal to "own the earth in fee simple." Yes, it certainly sounds far-fetched, but in this day of the Internet and instant global communications, it is much more feasible today than ever before. By consolidating companies and countries into ever-larger global corporations and nation-states [North American Union], fewer people have more power and control than ever before, especially in pursuing their sociopathic goals.

You think I'm making this up? One major player has a website titled "quietlyconquering.com".

Henry Kissinger is quoted as saying:

"Who controls the food supply controls the people;
who controls the energy can control whole continents;
who controls money can control the world."

So what does that have to do with Bank of America?

In today's Bloomberg article, Shiller Says Bank of America May `Have Some Problems', it states:

Countrywide, founded in 1969 by Chief Executive Officer Angelo Mozilo, gives Bank of America about 9 million borrowers and fees from servicing $1.5 trillion of mortgages. In past years, Countrywide has been responsible for one out of every five U.S. mortgages.
That is 20% of America's homes. I suspect their goal is acquisition of TITLE, not money. Yes, servicing 9 million borrowers will generate income, but that's not the goal. If you have more money than you could possible spend in your lifetime, what more could you want? Why not TITLE!?!

The article discusses that by saying:

``Maybe Countrywide and Bank of America are going to have some problems going forward,'' he said. ``When people see that their houses are worth a lot less than their mortgage balance, they have an incentive to default. The troubled mortgages that Countrywide already has will be followed by even more troubled ones.''
The leaders of these Major Holders may be sociopaths, but they are NOT stupid. They expect the defaults. But when the homeowner defaults, who owns the TITLE?

So how would you go about making sure you get TITLE? First, create a lending boom in the real estate market by making credit freely available at low interest rates. Encourage folks to treat their homes like an ATM, and convince them that homes will protect their investments against inflation.

Then reduce the homeowners' ability to pay the mortgage. Set up conditions so productive jobs migrate off-shore. Small companies have little choice than to merge with large conglomerates already completely controlled by these Major Holders. After the merger, they lay off increasing numbers of employees to "make the company more competitive." They re-organize health and pension plans so promises made earlier no longer need to be kept: "Sorry, we can no longer afford it."

Then deflate the value of their currency, which means they'll have to use a higher percentage of what's left to pay for food, clothing and transportation. Finally, create panic in the financial markets. This makes it easier to convert the target corporation into another abstentee-controlled plantation. Insider-ownership is reduced to zero percent. This is accomplished through financial pressure, resulting in a lowered value of the company's stock so insiders start selling out. Of course, it doesn't hurt to have an agent inside to keep the process under control. Agents are well-paid for their services, as documented by the Washington Post in "Big Payday Awaits Chairman After Countrywide Sale.

Thus the scenario that took place at Countrywide. Note that from June of 2007 to September of 2007, insiders reduced their share from 11% to 0%. That means control is now in the hands of the absentee Major Holders without opposition. Shareholders that do not know what is going on start panicking and sell their shares. Of course, the agent's buyers are ready.

Note that in June, 10% of Countrywide was worth $2 Billion. By September, the same 10% was worth $1 Billion. Obviously a 50% reduction in ONE quarter. It's amazing how fast these people can work. But in addition to insiders owning nothing now, the TOP 10 increased the percentage of total control from 60.84% to 66.53%! The TOP 10 make up only 2.5% of the total shareholders, but they control 66.53%. Now that's POWER!

Now that the share price is ridiculously low, the Major Holders have another corporation that they control show up as a "White Knight" to "rescue" what's left of the target company. The "White Knight" is Bank of America, where the insiders control only 1% of the shares, yet the TOP 10 Major Holders, comprising less than 1% of the shareholders, control 25.05% or more of the shares. Notice that some of the same Major Holders are in the TOP 10 of both companies.

And that's why I titled this commentary: Bank of America Devours Countrywide.

Sometimes The Dragon Wins

Symbol Name Of Corporation
CFC

Major
Holders
Countrywide Financial Corp. (As of 30-Jun-2007) (As of 30-Jun-2006)
Top 10 Institutional HoldersShares2007Value2006
AXA (Paris, France)55,062,2029.56%$2,001,511,042-.--%
Legg Mason Inc.51,587,9568.96%$1,875,222,2007.12%
Barclays Global Investors UK Holdings Ltd48,670,6888.45%$1,769,179,5089.18%
FMR Corporation (Fidelity Management & Research Corp)33,982,1815.90%$1,235,252,279-.--%
NWQ Investment Management Company, LLC31,642,2025.49%$1,150,194,0424.80%
TCW Group, Inc. (The) [Société Générale-France]25,286,5364.39%$919,165,5835.75%
Putnam Investment Management, LLC20,752,9043.60%$754,368,0604.37%
Price (T.Rowe) Associates Inc18,584,3383.23%$675,540,686-.--%
Barclays Plc18,285,7753.17%$664,687,921-.--%
Wellington Management Company, LLP17,955,1233.12%$652,668,7215.66%
% of Shares Held by All Insider and 5% Owners:11%11%
Top 10 [2.2%] of 456 Institutional Holders Control55.87%47.57%
Percentage of Barclays and "Associates" Control32.90%28.38%
NOTE: Fidelity also manages a fund that controls 2.26%.
Putnam also manages a fund that controls 1.42%.
T.Rowe Price manages a fund that controls 0.89%.
Therefore, the TOP 10 controls 60.84%, and
Barclays/Associates control 35.21% of Countrywide.

Symbol Name Of Corporation
CFC

Major
Holders
Countrywide Financial Corp. (As of 30-Sep-2007)
Top 10 Institutional HoldersShares2007Value2006
Legg Mason Inc.58,040,32510.03%$1,103,346,578-.--%
Capital Research And Management Company47,659,0008.24%$905,997,590-.--%
Brandes Investment Partners L.P.45,694,2227.90%$868,647,160-.--%
FMR Corporation (Fidelity Management & Research Corp)40,924,7247.07%$777,979,003-.--%
NWQ Investment Management Company, LLC32,994,4395.70%$627,224,285-.--%
Wellington Management Company, LLP25,674,0234.44%$488,063,177-.--%
Barclays Global Investors UK Holdings Ltd22,568,5893.90%$429,028,876-.--%
Pzena Investment Management, LLC22,339,9493.86%$424,682,430-.--%
UBS AG Basel, Switzerland21,894,3033.78%$416,210,700-.--%
Allianz Global Investors of America L.P. (Munich, Germany)21,857,8723.78%$415,518,146-.--%
% of Shares Held by All Insider and 5% Owners:0%-.--%
Top 10 [2.5%] of 393 Institutional Holders Control58.70%-.--%
Percentage of Barclays and "Associates" Control19.63%-.--%
NOTE: Legg Mason also manages a fund that controls 3.53%.
Fidelity also manages a fund that controls 2.25%.
Putnam manages a fund that controls 1.19%.
T.Rowe Price manages a fund that controls 0.86%.
Therefore the TOP 10 control 66.53%, and
Barclays/Associates control 25.21% of countrywide.

Symbol Name Of Corporation
BAC

Major
Holders
Bank of America Corporation (As of 30-Jun-2007) (As of 30-Jun-2006)
Top 10 Institutional HoldersShares2007Value2006
Barclays Global Investors UK Holdings Ltd216,775,4484.89%$10,598,151,6524.15%
State Street Corporation134,600,7503.03%$6,580,630,6672.99%
FMR Corporation (Fidelity Management & Research Corp)132,450,5652.98%$6,475,508,1223.35%
AXA (Paris, France)129,794,7332.93%$6,345,664,4962.65%
Vanguard Group, Inc. (The)126,717,1892.86%$6,195,203,3702.58%
Wellington Management Company, LLP107,157,5252.41%$5,238,931,3972.82%
Capital Research And Management Company101,852,5122.30%$4,979,569,3112.03%
Mellon Financial Corporation59,495,0001.34%$2,908,710,5501.39%
Northern Trust Corporation53,361,4401.20%$2,608,840,8011.29%
Goldman Sachs Group Inc49,079,2391.11%$2,399,483,994-.--%
% of Shares Held by All Insider and 5% Owners:1%1%
Top 10 [0.7%] of 1375 Institutional Holders Control25.05%24.42%
Percentage of Barclays and "Associates" Control11.57%9.82%
NOTE: Bank of America buys U.S. Trust.

© 2008 by Edward Ulysses Cate
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