This is Wally. I'm here with Brad Hinton and Tom Carney, and we welcome you to the call. I hear there are 48 people at this point. It's been a while since we did one of these calls. I think we felt like we got to the point where we didn't have much to say a year or two ago and now there does seem to be more to talk about and we invited questions. We got quite a few and the three of us will spend, we haven't timed this, but maybe 15 minutes or so talking about the things that seem to be of most interest. Strangely enough there is one stock that seemed to dominate the questions and most of them were politely worded.
At any rate, we're going to start right in with Countrywide Financial (CFC). I wrote some about it in the third quarter letter to shareholders. Things change daily in the mortgage world these days though, so here is a summary of where we are and how we got where we are and what we plan to do going forward.
With Countrywide we really focused on credit; knowing that there were a lot of mortgages held at the bank, that they were holding residuals from securitizations, that they had a pipeline that held lots of mortgages in between the time of origination and the time they were sold. We stress-tested the portfolio and I think we've really been pretty much on target so far about their exposure to credit losses.
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