Shakeups at Washington Mutual and Wachovia. Roundtable Discussion with Andrew Seibert of Nextier Wealth Management and Forbes CEO Steve Forbes.

Washington Mutual shares are down after Kerry Killinger stepped down as chairman. Shares of Wachovia are falling below it’s lowest value in almost 13 years after Ken Thompson was ousted.

Chairman Lanty Smith has been appointed interim CEO. Is this new management what these companies need to get back on track? Are there more troubles for financials?

I think their values will go lower until they get a feel for who will take over. There are probably more Writedowns to come.

These banks have not gone beyond the problem of the Subprime Mortgage Industry and there is possibly another shoe to fall.

If the Credit Deterioration continues, there will be many more problems.

Wachovia has big news today. Shares of falling in the premarket after the company ousted CEO Ken Thompson.

Wachovia stated he is stepping down at the request of the board, saying no single precipitating event calls because the board to reach the decision, but a series of previously disclosed disappointments and setbacks cumulatively have negatively impacted the company and performance. Perhaps you can call it an understatement.

Shares down 57% in the past 12 months.

The average time that a home sits on the market when it is for sale is now 11 months.

So what does that mean to you and me? It means nothing. Despite what is said by the professionals, we are still facing the largest portfolio of mortgage resets from right now in May 2008 to September 2008 (Mortgage reset chart).

So what does this really mean? Now we are on to something. Until the underlining mortgage issues are resolved, meaning the homeowners with mortgage resets that become unaffordable, of which only 30% of the affected homeowners are being helped, expect further home depreciation.

CNN.com has stated within the last few weeks that even with all the programs developed by the government, only about 30% of the homeowners can be helped. The reason is obvious. Why does any, for profit banking institution, want to take on the problems of another bank?

And the math is so simple. Add the inflationary pressures of oil, energy and what they mean to consumers discretionary dollars, as well as, the volume of adjustable rate mortgages that are resetting (remember that it takes between 6 months and 12 months to foreclose on a home - every state has their foreclosure laws) and you have a formula saying that we will be having credit and housing deterioration until at least 2010.

As we continue to analyze and manage our product set, Chase has made the decision to discontinue offering our Subprime and Home Equity products through our Wholesale channel.

New Wholesale Subprime and Home Equity registrations will not be accepted after Friday, May 16, 2008.

President Bollinger, Dean Hubbard, Co-Chairman Kravis, and distinguished guests, I am very pleased to be here and especially honored to receive the Columbia Business School’s Distinguished Leadership in Government Award. This evening I would like to offer a few thoughts on mortgage markets and the recent increase in the pace of delinquencies and foreclosures. My particular focus will be on geographic variation in mortgage performance and how that variation can help us better understand and prevent foreclosures. I will also discuss some initiatives taken by the Federal Reserve to address the foreclosure crisis as well as other policies that might be used to strengthen mortgage and housing markets.

Geographic Variation in Loan Mortgage Performance

As my listeners know, conditions in mortgage markets remain quite difficult, and mortgage delinquencies have climbed steeply. The sharpest increases have been among subprime mortgages, particularly those with adjustable interest rates: About one quarter of subprime adjustable-rate mortgages are currently 90 days or more delinquent or in foreclosure. Delinquency rates also have increased in the prime and near-prime segments of the mortgage market, although not nearly so much as in the subprime sector. As a consequence of rising delinquencies, foreclosure proceedings were initiated on some 1.5 million U.S. homes during 2007, up 53 percent from 2006, and the rate of foreclosure starts looks likely to be yet higher in 2008. Not all foreclosure starts result in the borrower’s loss of the home; sometimes the borrower is able to make up the missed payments or other arrangements are made with the lender. Given the number of borrowers in distress and the weakness of the general housing market, the share of foreclosure initiations that ultimately result in the loss of the home seems likely to be higher in the current episode than customarily has been the case.

Critics are blaming Alan Greenspan for today’s financial crisis, but now the former Federal Reserve chief is fighting back.

Greenspan sets the record straight in an exclusive interview.

Part 1

Part 2

What are others saying about Alan Greenspan

Alan Greenspan unfair blame for sub prime crisis…

Why do people blame Alan Greenspan for the sub-prime crisis? He lead the Federal Reserve Board during the dot-com crash, 9/11 and following years when interest rates in the US fell as low as …lead - http://www.searchforvideo.com

The Stock Market Crash Of October, 1987

Alan Greenspan was appointed Chairman of the Federal Reserve Bank in August of 1987 and at this time was standing in the shadow of Paul Volcker, whom Wall Street trusted as a tested leader in moments of crisis Exploit The Market - http://exploitthemarket.com/

Bank of America Net Drops 77%

On December 20, 2007, the Federal Reserve will offer $20 billion in 35-day credit through its Term Auction Facility. Additional information regarding the auction is listed below; the auction will be conducted as specified in this Announcement, Regulation A, and the terms and conditions of the Term Auction Facility (www.federalreserve.gov/monetarypolicy/taf.htm).

Description of Offering and Auction Parameters

Offering Amount:	$20 billion
Term:	35-day loan
Bid Submission Date:	December 20, 2007
Opening Time:	10 a.m. EST
Closing Time:	1 p.m. EST
Notification Date:	December 21, 2007
Settlement Date:	December 27, 2007
Maturity Date:	January 31, 2008
Minimum Bid Amount (per bid):	$10 million
Bid Increment	$100,000
Maximum Bid Amount (per institution):	$2 billion (10% of Offering Amount)
Minimum Bid Rate:	4.15 percent
Incremental Bid Rate:	0.001 percent
Minimum Award:	$10,000
Maximum Award:	$2 billion (10% of Offering Amount)

Submission of Bids
Participants must submit bids by phone to their local Reserve Bank between the Opening Time and Closing Time on the Bid Submission Date.

Notification
Summary auction results will be published on the website of the Board of Governors of the Federal Reserve System (www.federalreserve.gov/monetarypolicy/taf.htm) at approximately 10:00 a.m. EST on the Notification Date. Between 10:00 a.m. and noon EST on the Notification Date, Reserve Banks will notify individual institutions in their districts that have submitted winning bids of their awards. Participants have until 3:00 p.m. EST on the Notification Date to inform their local Reserve Bank of any error.

Rounding Convention
Pro rata awards will be rounded to multiples of $10,000. Normal rounding convention will be used, except that awards under $10,000 will be rounded to $10,000.

2007 Monetary Policy Releases

A Worsening Outlook: Bank of America. Rising Credit Losses, Problems in Credit Cards and Home Equity, Writedowns on CDOs “Unknowable”, Charge-Offs Will Rise Next Year; CEO Ken Lewis Will Face More Problems as Consumer Spending Slows; Some Say Bank of America Stock Will Outperform the mortgage industry.

Bank of America, PNC Financial, Wachovia Announce $5+ Billion In Writedowns. Bank of America Says Provision Cost Reflecting Boosted Reserves; PNC Financial 4Q Forecast Below Analyst Estimates, Increases Provision and Revises 2008 Forecast; Wachovia Sees 4Q Provision Expense $1 Billion Higher Than Charge Offs.