Page 629 - untitled

600 Notes to Chapter 13

11. Angelo Mozilo, testimony taken by the SEC in the matter of Countrywide Financial Corp., File
No. LA-03370-A, November 9, 2007, pp. 150, 36–37.
12. Angelo Mozilo, email to Lyle Gramley, member of Board of Countrywide Financial Corporation
(cc Michael Perry, chief executive officer, IndyMac Bank), August 1, 2007.
13. Eric Sieracki, quoted in Mark DeCambre, “Countrywide Defends Liquidity,” TheStreet.com, Au-
gust 2, 2007.
14. “Minutes of a Special Telephonic Meeting of the Board of Directors of Countrywide Financial
Corporation,” August 6, 2007, pp. 1, 2, 1.
15. Fed Chairman Ben Bernanke, letter to FCIC Chairman Phil Angelides, December 21, 2010.
16. Federal Reserve Staff, memo to Board of Governors of the Federal Reserve System, “Background
on Countrywide Financial Corporation,” August 14, 2007, pp. 1–2.
17. Ibid., pp. 12–13.
18. Countrywide Financial Corporation, Form 8-K, Exhibit 99.1, filed August 6, 2007. See also “Min-
utes of a Special Telephonic Meeting of the Boards of Directors of Countrywide Financial Corporation
and Countrywide Bank, FSB,” August 15, 2007.
19. Angelo Mozilo, interview by FCIC, September 24, 2010.
20. Kenneth Bruce, “Liquidity Is the Achilles Heel,” Merrill Lynch Analyst Report, August 15, 2007, p.
4; Kenneth Bruce, “Attractive Upside, but Not without Risk,” Merrill Lynch Analyst Report, August 13,
2007, p. 4.
21. Mozilo, interview; the article, by E. Scott Reckard and Annette Haddad, was titled “Credit Crunch
Imperils Lender: Worries Grow about Countrywide’s Ability to Borrow—and Even a Possible Bank-
ruptcy.”
22. Angelo Mozilo, quoted in “One on One with Angelo Mozilo, Chairman and CEO of Countrywide
Financial,” Nightly Business Report, PBS, August 23, 2007, transcript; and in “CEO Exclusive: Country-
wide CEO, Pt. 1,” The Call, CNBC, interview by Maria Bartiromo, August 23, 2007, transcript, p. 1.
23. Sebastian Boyd, “BNP Paribas Freezes Funds as Loan Losses Roil Markets,” Bloomberg, August 9,
2007.
24. “BNP Paribas Investment Partners Temporally [sic] Suspends the Calculation of the Net Asset
Value of the following funds: Parvest Dynamic ABS, BNP Paribas ABS EURIBOR and BNP Paribas ABS
EONIA,” BNP Paribas press release, August 9, 2007.
25. Paul A. McCulley, testimony before the FCIC, Hearing on the Shadow Banking System, day 2, ses-
sion 3: Institutions Participating in the Shadow Banking System, May 6, 2010, pp. 237, 309.
26. Daniel M. Covitz, Nellie Liang, and Gustavo A. Suarez, “The Evolution of a Financial Crisis: Panic
in the Asset-Backed Commercial Paper Market,” August 24, 2009, p. 39.
27. Ibid., figure 1, panel B, p. 33.
28. “The Federal Reserve Is Providing Liquidity to Facilitate the Orderly Functioning of Financial
Markets,” Federal Reserve Board press release, August 10, 2007.
29. Federal Reserve Board, press release, August 17, 2007.
30. Henry Tabe, Moody’s Investors Service, “SIVs: An Oasis of Calm in the Sub-prime Maelstrom:
Structured Investment Vehicles,” International Structured Finance: Special Report, July 20, 2007, p. 1.
31. Ibid.
32. Henry Tabe, interview by FCIC, October 4, 2010.
33. Moody’s Investors Service, “From Illiquidity to Liquidity: The Path Toward Credit Market Nor-
malization,” Moody’s International Policy Perspectives, September 5, 2007, p. 1.
34. Tabe, interview.
35. Moody’s Investors Service, “Moody’s Update on Structured Investment Vehicles,” Moody’s Special
Report, January 16, 2008, p. 12.
36. Information provided to the FCIC by Deloitte LLP’s counsel, August 2, 2010.
37. Moody’s Rating Action, “Sigma Finance,” September 30, 2008; Henry Tabe, The Unravelling of
Structured Investment Vehicles: How Liquidity Leaked through SIVs: Lessons in Risk Management and Reg-
ulatory Oversight ([Chatham, Kent]: Thoth Capital, 2010), p. 60.
38. The SEC indicated it is aware of at least 44 money market funds that were supported by affiliates
because of SIV investments. See Securities and Exchange Commission, “Money Fund Reform” (Proposed
rule), June 20, 2009, p. 14 n. 38.