Replies to post #236155 on Mr Cooper Group Inc (COOP)

[steved_45]

Why would they? Remember the seizure occurred Sept 27th when reviewing these articles. The Street knew WaMu was gonna blow up before it did based on CDS prices so why not wait until it's in receivership? Skim these articles but read the last 2. In case you don't know what a CDS is, it's the cost to insure the company's debt based on the likely hood of risk of default. The second to last article says that accounting rules made it very unfavorable for a bank to take out WaMu.

If you wanted to buy a house would you buy it from someone for retail knowing that he's been in default or would you wait to get it from the bank at a discount? The answer is obvious especially if you have to report to shareholders.

July 23rd: WaMu's 3.3BB earnings loss and S&P downgrade
http://uk.reuters.com/article/idUKN2349502620080723

July 25th WaMu CDS prices: Above where Bear Sterns was before they imploded
http://globaleconomicanalysis.blogspot.com/2008/07/credit-default-swaps-on-wamu-others.html
(notice the other companies in that chart)

July 27th: Media hates WaMu's statement of 50BB in liquidity and CDS almost double from 2 days earlier
http://mrmortgage.ml-implode.com/2008/07/27/wamu-what-options-do-they-really-have/

Sept 10th CDS prices looking at 80% chance of default
http://slog.thestranger.com/2008/09/credit_default_swaps_indicate_theres_an
"Washington Mutual Inc., the largest U.S. savings & loan, failed to interest suitors in a purchase this year because new accounting rules for devalued loans are driving away buyers, two bankers involved in the talks said."

Sept 12th: 5 yr CDS now costs 40% of debt amount plus 500k/yr
http://www.fool.com/investing/dividends-income/2008/09/11/is-washington-mutual-about-to-explode.aspx
Notice Lehman Bros saying housing in Cali will decline by more than 50% or double from the current decrease--WaMu had heavy exposure in CA