patrick.net

I would argue that there is some manufacturing under the 'health care' term. Some times when I use some piece of equipment, ie, blood tubing, 3-way stopcock, needle, syringe, etc, I look at the 'Made in ____' and you'd be surprised how many say some town in Minnesota or Indiana, etc.

How are they treating them differently? They are a bank, everything is business to them. Don't they try to do whatever makes them the most money regardless of whether they are Wachovia loans or WF loans?

My 'personal insider' told me that WF wrote off $60B on Dec 31, 2008 thanks to the Wachovia deal so there;O)

It is my understanding that WF had made very few bad RE loans, I think their default rate was around 2% but then they took over the ugly Wachovia portfolio that was loaded with bad loans. My insider said they just wrote off 30% of the entire Wachovia deal instead of looking at each individual loan. Not sure how they are picking through the ashes now. I do know that WF turned many of those risky Wachovia loans into Interest Only for 6-10 years in hopes of the market turning around.

WF basically bought Wachovia 70cents on the dollar so what are their chances of making a profit on those mortgages? Guess it depends where most loans were given, ie, Nevada? Florida?

If they've managed to convert many of them into 6-10 year loans, then they've done pretty well. The housing market will likely be fairly different in 10 years. Even if it's not massively appreciating, the amount collected + 10 year future sale will probably be more than 70% of that investment.

On another thread, someone was complaining about warren buffet and his dealings. After having read his book, I realize that all the companies I *hate* are ones that he's invested in. The ones I hate, are the smart ones, who know how to milk their products and customers. Wells fargo will walk away with a boat load of money. So I dont think it matters where many of these properties are, as long as they can lock people into 10 year loans, many people will snap those up and be happy they got out of their dire predicament. I would say they're making another mistake, but that mistake is going to end up profiting wells fargo nicely.

Btw, Warren Buffets book had very little to do with investing, and more to do with his personality and life. It was a fascinating book.

Here's a link to WF data:
Wells Fargo has written $2 billion off Pick-A-Pay balances for borrowers, or nearly $46,000 per modified loan. The bank has modified 43,500 Pick-A-Pays so far this year through September, and said the program is effective at keeping borrowers in their homes. The program eliminates the nearer-term risk for borrowers of sharply ballooning payments, according to the company.
To reiterate what someone else said, this is business for WF -- not some gov't program (not the say the gov't wasn't involved in declaring Wachovia troubled and parading them through the streets to look for a buyer). Wells was a fairly conservative lender during the boom years and are being rewarded for it. They do have, though, a large portfolio of seconds, so the jury is still out...