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.

Washington Mutual , hard-hit by the mortgage and credit crises, will replace Chief Executive Kerry Killinger as chairman of the board.

NEW YORK, April 15, 2008 (PRIME NEWSWIRE) — Beleaguered investors of Washington Mutual (NYSE:WM) were delivered more bad news by the company in Tuesday’s after-hours earnings announcement. The company reported a first-quarter loss of $1.14 billion and indicated that it expects Writedowns of $12 billion to $19 billion of its $187 billion portfolio of single family residential home loans in 3 to 4 years.

Litigation on behalf of Washington Mutual employees and 401(k) plan participants has commenced against the company for alleged violations of the Employee Retirement Income Security Act (ERISA) in the United States District Court for the Western District of Washington. If you are an employee of Washington Mutual and wish to discuss the investigation or have questions concerning this notice or your rights, please contact Scott+Scott (scot...@scott-scott.com, (800) 404-7770, (860) 537-5537), for more information. There is no cost or fee to you.

WAMU recently said that they wanted to, “Strengthening the Mortgage Industry” in a press release and now they need their mother’s help to go to the bathroom. So which direction are they these so called leaders really leading?

Washington Mutual began offering this ‘new’ full disclosure program to the mortgage clients delivered through mortgage professionals BUT not to the clients they receive via their retail locations. Why don’t their retail clients deserve this full disclosure?

So the reputation of WAMU appears to be tarnished at best. It has been so bad at WAMU that even powerhouse Credit Suisse Questioned the “credibility” of the Washington Mutual management.

On a very serious note, we feel bad for their stockholders, the hundreds of employees they are letting go and the millions affected by, what the world has come to know as a ‘Lack of Leadership’.

Here is their political spin in an effort to try to look good.

April 7, 2008, WaMu announced significant changes affecting our Home Loans business. As part of this announcement, and consistent with the company’s retail focused strategy, WaMu has made the very difficult decision to exit the Wholesale lending business. In order to have an orderly shut down, we have determined the following critical dates:

April 10, 2008: Last date to submit new applications or locks.

May 31, 2008: All WaMu Wholesale Sales Centers will be closed by this date.

June 13, 2008: Generally, all loans must be closed/funded by this date. We will, however, honor outstanding loan commitments with expiration dates after

June 13, 2008 up until the
expiration dates set forth in those commitments.

June 30, 2008: All WaMu Wholesale loan fulfillment centers (LFCs) [San Diego, CA; Pleasanton, CA; Downers Grove, IL; and Jacksonville, FL] will be closed by this date.

Current Pipeline:
*Locked loans with an expiration date prior to June 13, 2008 may be extended per current policy provided the loan is closed/funded by June 13, 2008.

*Effective April 8, 2008, a condition will be added to each new commitment which will supersede the normal expiration provision.

*Floating loans must generally be locked, closed/funded by June 13, 2008. Again, they may only close and funded after June 13, 2008 if a loan commitment has already been issued and the commitment
expires after June 13, 2008.

*If a loan is locked with an expiration date past June 13, 2008, it will not be honored unless a loan commitment has been issued and the commitment expires after June 13, 2008.

*We are unable to make any exceptions regarding the closed/funded date of June 13, 2008. Again, however, we will honor outstanding commitments with commitment expiration dates beyond
June 13, 2008.

WaMu will continue to originate loans through Consumer Direct and our Retail Lending channel.

Your Account Manager or Sales Manager will be available to support you while we transition out of this business.

This is a very hard day for WaMu and all of Wholesale Lending. We have appreciated your partnership and support over these many years and wish you the best as we move on to new opportunities.

Credit Suisse Questions Washington Mutual Management

In a new research report, Credit Suisse calls into question the “credibility” of Washington Mutual’s management, citing what it calls “numerous upward revisions” to the thrift’s credit expectations on future writedowns.

“We are concerned by the deterioration of WaMu’s credit metrics and we do not believe WaMu is out of the woods,” writes analyst Moshe Orenbuch. (The nation’s largest thrift recently raised $3 billion in convertible preferred stock, offering a coupon of 7.75% on the notes).

Credit Suisse predicts that WaMu faces credit losses of nearly $5 billion in 2008, with an additional $3.55 billion of reserve additions. “We believe that (nonperforming assets) should increase to roughly $10 billion or 3% of total assets,” Mr. Orenbuch says. Credit Suisse has a “neutral” rating on the stock.

In trading Tuesday, WaMu’s share price fell to a new 52-week low of $14.11. Its high is $46.

Subprime Crack For Homeowners

Analysis and Discussion with Dick Bove of Punk Zigel: JPMorgan May Make a “Major” Acquisition Soon. JPMorgan May Consider Buying Washington Mutual

Reaction with Mark Demos of Fifth Third Asset Management; Washington Mutual Expects Net Loss for 4Q, Will Raise $2.5 Billion in Additional Capital, Reduce Dividend; WaMu Closing About 190 of 336 Home Loans Centers and Sales Sites

Washington Mutual recently began requiring its brokers to use a newly created disclosure form they developed which, they say will help borrowers better understand mortgage loan terms.

However, the majority of homeowners already complain they have too many disclosures and find the the required barrage of paperwork cumbersome and difficult to understand.

WAMU also stated they will call and bother all prospective borrowers to review the mortgage terms with them.

But is this a smokescreen for their bigger problems?

Click here to view letter - /media/letters/11-08 Ltr to Cuomo.pdf

Ironically, New York Attorney General Andrew Cuomo said Wednesday he subpoena Fannie Mae and Freddie Mac as part of a widening probe of the residential mortgage industry.

The subpoenas seek information on mortgages purchased by the government sponsored enterprises(GSE’s) from their seller/servicers, including Washington Mutual of Seattle.

The GSEs also agreed to a demand by the New York Attorney General that they hire an independent examiner to conduct a review of all WaMu appraisals on mortgages they purchased.

“In order to fulfill their duty to consumers and investors, Fannie Mae and Freddie Mac must ensure that Washington Mutual’s mortgages have not been corrupted by inflated appraisals,” the attorney general said in a statement.

It appears they have lost their focus. If indicted, WAMU’s problems are much greater than any broker or pseudo disclosure.

‘People in glass houses shouldn’t throw stones’.

New York Attorney General Andrew Cuomo Widens Investigation to Fannie Mae and Freddie Mac.

Among other things, the subpoenas seek information on mortgages purchased by the government sponsored enterprises(GSE’s) from their seller/servicers, including Washington Mutual of Seattle.

The GSEs also agreed to a demand by the New York AG that they hire an independent examiner to conduct a review of all WaMu appraisals on mortgages they purchased.

In 2006 WaMu sold north of $30 billion in loans to the GSEs. “In order to fulfill their duty to consumers and investors, Fannie Mae and Freddie Mac must ensure that Washington Mutual’s mortgages have not been corrupted by inflated appraisals,” the attorney general said in a statement.