Media Taken For a Ride by Countrywide CEO

Remember how he exercised options and sold stock, quickening the pace last fall? Just recently, in speaking about this mortgage mess, Mozilo said: "Nobody saw this coming."

Also recently, when asked about whether Countrywide should have been more careful about lending to every chucklehead who asked, Mozilo, who runs the nation's biggest lender, shrugged at the prospect of setting any standards above mob psychology rule: "Our place in the industry would have changed dramatically because we would have arbitrarily made a decision that was contrary to what everything appeared to be -- values going up and no delinquencies, no foreclosures -- and we suddenly stop the music."

That strange quote got added meaning for The Business Press Maven after yesterday's CNBC interview. He is essentially saying that the proper function of a financial institution is not to anticipate. If there were no foreclosures yesterday, assume there will be none tomorrow. Yet on CNBC, Mozilo criticized the Fed for reacting to what has "happened" in terms of financial data, not what is "happening." He said that Countrywide had a better bead on what was "happening."

As recently as March, Mozilo, now busy talking about the Depression and dropping little scare hints about no loans to lower income and minority populations, said the subprime worry was "clearly an overreaction." At the same time, he said the subprime issue was a great positive for Countrywide because "all irrational competitors will be gone."

And while Mozilo is throwing images of the Depression around, he is also saying that the housing market should stabilize in 2008 and recover in 2009. Some Great Depression environment, huh? Similarly, he was busy braying on CNBC about how he sees no "light at the end of the tunnel," while, in the next breath, noting that "something tomorrow can turn it around."

Look, Mozilo did not get to where he is by lacking the gift of blarney. All I'm saying is that the business media should be aware of it as they keep quoting him as a financial prognosticator. He is not. He is a self-interested operator with a history of inconsistent statements. Investors, just beware. And be aware.

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