The New York Post brings more encouraging news about the economy: First, top mortgage lender Countrywide has discovered that an $11.5 billion emergency credit line drawdown, a $2 billion investment from Bank of America, and 12,000 job cuts won’t be enough, so it has hired Goldman Sachs to find another multi-million dollar bailout partner. Meanwhile, Countrywide CEO Angelo Mozilo is following the great Wall Street tradition of whining to Fed Chairman Bernanke on national TV, pleading for an interest-rate bailout. Countrywide’s online ad spending reportedly hung in there during August. We would be shocked to see it do so during September.
Second, a “chorus” of economists have suddenly discovered that the nationwide housing market crash combined with record mortgage-debt levels might be something to worry about. The head of mortgage lender WaMu, for example, has started speaking of a “perfect storm.” Moody’s is trying to make up for locking the barn door after the horse was stolen by arguing that the economy is screwed through 2009. Multiple Fed governors are now jawboning about how the housing plague has spread to the rest of the economy. Lastly, the crappy employment report released on Friday may have been way worse than it looked.