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Wednesday, April 9, 2008

The Sign of All Times

posted by on April 9 at 9:52 AM

Who is paying for the WaMu mess? No need to guess:

The Florida employee said she’d like to leave the industry but “I’m 58, and I’ve got a house and car payments to make and parents who have Alzheimer’s, and I don’t know what else to do.”

A Seattle-area loan officer who is being laid off after a decade at WaMu said he and others are angry at upper management.

“On April 1, they told the big producers that we’re solid, we’re good, we want to keep you, and less than a week later, you’re gone,” he said.

“The loans we do did not cause their problem,” he added, saying that people in WaMu’s conventional-lending business are paying for missteps the company made with subprime loans, which were given to people with poor credit.

Dave Erickson, president of the Washington Association of Mortgage Brokers, said he is surprised that WaMu will no longer supply loans through mortgage brokers. He predicted borrowers will be affected.

Because history is nothing but this anger, betrayal, and struggle, why are these WaMu employees and contractors so surprised? Stop being surprised.

RSS icon Comments


To be fair, it's not the employees who are expressing surprise in that quote. It's the mortgage brokers who are losing a huge chunk of business. I don't think any WaMu employees being laid off are truly "surprised". But it still sucks to lose a job.

Posted by laterite | April 9, 2008 10:05 AM

Also, I think you have some link fixage to perform.

Posted by laterite | April 9, 2008 10:07 AM

their retail banking is still pretty good though.

Posted by Bellevue Ave | April 9, 2008 10:09 AM

When is Kerry Killinger getting his pink slip? And, when is he selling the corporate jet and flying coach?

Posted by grateful I am not a WM employee | April 9, 2008 10:19 AM

when shareholders tell him to.

Posted by Bellevue Ave | April 9, 2008 10:24 AM

The fun thing about this mortgage crisis is, nobody really knows where it came from. I mean, sure, subprime lending, unqualified buyers, yadda yadda. But the real issue is the exposure of ALMOST EVERYTHING through the mysteries of derivative trading that even derivative traders don't understand. And everybody's got a piece of it, even lots of companies that don't do mortgages.

WaMu's completely fucked, of course. They may not even survive as a company, especially if they find any more hunks of business that have been securitized, if that's the right word.

Posted by Fnarf | April 9, 2008 10:26 AM

@5 - we can't tell him to. There's literally no way for investors to do that - we don't get to vote on his pay package, and they even ignore our votes on travel expenses as well.

(caveat - only own BofA and PBBT shares at the moment)

derivatives (including CDOs and such) are just gambling wrapped up in a pretty bow and called "assets" - thanks to the MBAs like GWB.

Posted by Will in Seattle | April 9, 2008 10:38 AM

The sickest part of the whole mess is that the WAMU board of directors changed the compensation plan so that the senior executives won't be compensated based on the mortgage business meltdown, but rather on other parts of the business and fuzzy metrics. In other words, they screw up, people lose their jobs, and they'll still get their million dollar bonuses.

Posted by bob | April 9, 2008 11:01 AM

@8 - exactly - and it's not even put up to a binding vote by shareholders.

Posted by Will in Seattle | April 9, 2008 11:16 AM

I agree with @6 that the problem is probably not the loans that WAMU originated but the securitized loans that it bought. I'm not sure decent mortgage brokers shouldn't have been surprised. As people have pointed out above it's management that seems to be escaping with their money and jobs, and monkey pres is bailing them out with the pretend stick of more regulation (hasn't really been his administration's strong suit).

Posted by left coast | April 9, 2008 12:02 PM

So basically if I hadn't been laid off by WaMu in December I would have been laid off this month.

I wish I still had access to the internal wamu blog. That's gotta be some fun stuff right now, if they haven't shut it down.

Posted by monkey | April 9, 2008 12:28 PM

New home loans are in the crapper. Did they not see prices and number of sales going down and inventory going up industry-wide? Expecting Wamu to keep employing them when there is little new business is like expecting Exxon to keep employing full serve gas attendants after all the oil is gone.

Posted by King Rat | April 9, 2008 8:29 PM

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