Friday, November 2, 2007

More pathetic desperation

November 1, 2007, 2:52 pm
With Six CDs, You Get an Eggroll
Posted by David Gaffen
There’s something to be said for being relentlessly positive, no matter what’s happening. An upbeat attitude during Countrywide Financial’s most recent earnings release gave shares of the beleaguered mortgage lender a 32% bounce last week.
Rather than wallow in its funding issues, the company is instead putting the word out that it’s offering better rates on certificates of deposit than basically everybody, at 5.65% for a nine-month CD, which is terrific considering long-term Treasurys aren’t even close to that.
But it’s hard not to detect a whiff of desperation in these efforts. You see, instead of just advertising on the Web, or in major newspapers, the company is taking the scattershot approach of leaving doorknob flyers (see at right) at various residences in highly populated areas, such as Prospect Heights in Brooklyn, N.Y., to try to entice people to come down and open a CD.
If anything underscores a company’s need for short-term funding, it’s a low-yielding, “throw everything against the wall and see what sticks” approach such as this one, which is likely to result in most of these flyers getting thrown in the garbage. Shares of the stock are down another 6% today, getting swept along with the rest of the sagging banking industry.

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