Monday, June 16, 2008

Some Things on My Mind!


WSJ and Sen. Shelby


The WSJ today editorially opines on Countrywide making mortgage loans to prominent individuals on favorable terms.

It calls for a Senate investigation of the matter and suggests--since Banking Committee Chairman Senator Chris Dodd (D-Ct.), may be conflicted because his mortgage was provided by Countrywide--that Committee ranking Republican Sen. Dick Shelby (R-Ala.) “will need to take the lead.” (Cue the “William Tell overture,” i.e. music to the “Lone Ranger” riding to save the day.)

Fine, but shouldn’t someone first check with Senator Shelby to make sure that he isn’t beholding in any way to the mortgage lenders or investors that he’s spent the past year pinioning? Which lender financed his residence(s) or other properties he owns? Wouldn’t it be ironic—indeed hypocritical--if Dick Shelby somehow benefited from one of the companies he rails against constantly?

If I was on the WSJ’s editorial board, I would want to make sure that I did not promote someone for chief inquisitor, who might have to refuse the “honor,” because of a business decision he or his representatives made involving a now “damned” lender or even Fannie Mae or Freddie Mac.

Maybe the Journal already has that intelligence and can clear Sen. Shelby from any suggestion that his status as a senior Banking Committee member—and former Chairman--has somehow helped him with commercial or personal real estate financing?

If it has, I hope the Journal can share that information, or if it can’t maybe Mr. Murdoch’s publication should choose a new horse, since using the WSJ’s ethics standard Senator Shelby will have disqualified himself from judging the GSEs.

Jim and Angelo


I am not going to get too much into the Jim Johnson/Countrywide issue because I only know what I have read. I don’t think I’ve spoken to Jim in three years or more and with Angelo it is longer.

But, I will say that Jim Johnson was a superb Chairman/CEO for Fannie Mae. He was the man for his time and took a fine company, which David Maxwell revived and breathed life into, and made it super. Johnson drove Fannie Mae to even greater heights in terms of low income families served, innovation pioneered, and market efficiency introduced.

It’s easy—in these tougher times—to look back and scorn what the GSEs accomplished and imply that anyone could have achieved what Fannie, in the Johnson years, and Freddie did. But that isn’t correct.

When Johnson was Fannie’s Chairman driving major housing initiatives and efforts, everybody sought a piece of Jim and wanted Johnson to be their speaker, show up at their event, testify at their hearing or just talk to them quietly over a diet Coke about the mortgage market.

To members of both political parties—in both chambers--and with financial and mortgage finance interest groups across the continuum, Jim was a “winner,” while leading Fannie, and everyone wanted to be associated with the guy on top.

The same was true with Angelo Mozilo. It was not too long ago that Angelo and Countrywide, which became the nation’s largest mortgage lender, were the gold/platinum standards in the mortgage banking community. No forum or leadership group meeting was complete without Angelo or a Countrywide rep.

Until its recent sale to Bank of America, Countrywide was one of the few remaining independent mortgage companies, not owned or operated by a large bank but by friends and family. The mortgage lending world identified with Angelo’s business success, trumpeted his hard work, and his unique schedule, which was based on rising in California on east coast time. In his halcyon days, Mozilo was a dynamic lender, a sympathetic and knowledgeable industry leader, dedicated to making sure mortgagors got the correct financing for them. Now, he’s viewed as much less.

I am certain that no one single mortgage lender has been asked to testify before Congress more often than Angelo Mozilo or to speak to other related industry groups, not because of his foibles, but because he did so much that was right.

I remember Mozilo recounting how, when he heard too many complaints about Countrywide’s rejecting minority applications, he personally began to go over individual mortgage turndowns and queried his underwriters for their reasoning and often changed their decision, turning “no's” into approvals.

Everybody—including his own employees—knew about the “Friends of Angelo” group, which frankly was not that exclusive, because Angelo liked to “help” people and that was his way.

There is nothing that I can add to all of those bromides about hindsight being 20-20, but I sense that most of the snarky negative comments last week about Johnson and Mozilo were made by people—unlike Johnson and Mozilo--who never took big steps, never took big risks, never dreamed large dreams, or never produced major successes.

Both men may have made mistakes, as we all do, but their good works should never be lost in the rush to belittle them.

Tim Russert


I did not know Tim Russert, personally, although I occasionally saw him in the street. The NBC headquarters and studio were fairly close to Fannie Mae and when I’d see him on Wisconsin Avenue and shout “Hi Tim,” as if we were old buddies, he always would smile or respond.

He simply was the best political interviewer I have ever seen. No matter who he was questioning, Russert would bear down and follow up so they couldn't wriggle away. He wasn’t smarmy or negative, just substantive and comprehensive. He made “Meet the Press” a Sunday must see (or must listen, if you were traveling and could only hear the broadcast) and won’t easily be replaced.

Two people whom I would love to see NBC consider as Russert successors are Jon Stewart and Harold Ford, Jr. The latter is a hugely brainy politician, with great charisma and appeal. The former masquerades as a comedian but he possesses a very bright, inquisitive mind, someone who could adapt easily to becoming a charming political junkie, like Russert.

Tim Russert didn’t go to work last Friday expecting to have a fatal heart attack and never see his family, again. It’s a lesson to all of us about how fragile our existence is and why “tomorrow isn’t promised to anybody.” So, don’t hold back. Live your dreams with gusto and extend love and affection to the people around you. If you’re fortunate, you’ll even reap what your sow.


Maloni 6-16-2008

1 comment:

Anonymous said...

Few people know Jim Johnson from the vantage point of Bill Maloni, who was one of his senior advisors for Johnson's entire tenure at Fannie Mae. Johnson was a consumate perfectionist, Bill a rough rider who got it done. It wasn't always an easy relationship but neither man tolerated clones and each respected the unique value the other brought. It would be easy for someone like Bill Maloni to play the Washington game of pile-on. Instead he rightly defends a real leader who took huge risks when it would be convenient to play it safe.

Jim Johnson isn't an easy man to work for but he is a great man to work for because he demands more from everyone around him than they believe they can deliver and deliver they do. Millions of families own their homes today because of his audacious vision and demanding execution. They got safe, fixed-rate mortgages and low down payments that were deemed irresponsible but were not. Some of them refinanced those loans into the kind of adjustable rate mortgages Johnson's critics championed just a year ago and watched their dream turn into a nightmare. But most did not. That's a legacy that will outlast any news cycle.

Those of us who were privileged to help him will always know who made it possible, how hard it was to accomplish, and how profoundly it changed the lives of so many for so much better.