Obama's Countrywide connection

Obama's Countrywide connection : L.A. Land : Los Angeles Times

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Obama's Countrywide connection

Two degrees of separation: The Wall Street Journal reports that a very special friend of Sen. Barack Obama is also a very special friend of embattled Countrywide Financial co-founder Angelo Mozilo.The Journal reports that James Johnson -- a high-ranking advisor to Obama -- was part of an elite group -- "friends of Angelo" -- who got more than $7 million in special loans from Countrywide.The New York Sun spells out details here: "James Johnson, one of three people tapped by Mr. Obama recently to oversee the search for his running mate, took at least five real estate loans totaling more than $7 million from Countrywide Financial Corp. through an informal program for friends of the company's CEO, Angelo Mozilo, the Wall Street Journal reported Saturday."

More: "The Journal said at least two of the mortgages, among a series of loans made available to people Countrywide officials called "friends of Angelo," were at rates below market averages, though it is difficult to predict a market rate without access to nonpublic information about a borrower's credit history and other factors that can reduce interest charges on a loan."

About James Johnson: He's part of the permanent government of this country, a long-time Democratic fixer (Mondale and Kerry campaigns), former CEO of Fannie Mae, and as such a big buyer of Countrywide loans. He's a guy who sits on a bunch of corporate boards, etc.

Outrage: "That reeks most high," said Bonnie Russell, a public relations specialist and vocal critic of Mr. Mozilo, according to the Sun. "Where's the 'change to believe in' if they're playing the same old game using the same old players?"

Your thoughts? Comments? E-mail story tips to peter.viles@latimes.comPhoto Credit: A.P.Hat tip: BR, via e-mail, mylessthanprimebeef

Posted by Peter Viles on June 9, 2008 in Countrywide Financial Permalink


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Comments

Unless you're talking policy, or ability to govern, you can't touch him with this. You can only distract him, if he's so inclined to be distracted. Here's the lesson we've learned over the past 18 months: Mr. Obama is able to get his argument across no matter the distraction. And why is Bonnie throwing stones?DG... San Diego, CA

Posted by: Donnie G June 09, 2008 at 10:06 AM
This is a cheap shot. Countrywide was the biggest and most aggressive lender out there and a lot of their loans are going bad becuse of it. Mozillo was very highly regarded before this mess and knew a lot of influential people. Show me some proof before you make allegations that this is a sweetheart deal. So far it's just the most blatant guilt by association story I have seen.

Posted by: Paul Hiller June 09, 2008 at 10:32 AM
Posted by: Donnie G:
"You can only distract him, if he's so inclined to be distracted"
I'm amazed at how fast these talking points get seeded into the lexicon.
Distraction: any subject which makes Obama or his supporters uncomfortable.

Posted by: TakeFive June 09, 2008 at 10:35 AM
And so it begins... Strikes me that Mr. Viles and Ms. Russell should have done a bit more homework. Then again, I suppose this demonstrates that blogging doesn't equal journalism. Even a scintilla of research into this "link" between Johnson and Mozilo, along with the noted transactions, would reveal no illegal activity nor a failure to disclose. Ever heard of a 10K? or 10Q? Not to mention that neither Mozilo nor Countrywide have made contributions to Sen. Obama's campaign - see the Federal Election Commission records! Do your homework Mr. Viles, lest you further erode the Los Angeles Times journalistic reputation by using the NY Sun (versus NY Times?) as a source for your blog subjects.

Posted by: Zooey June 09, 2008 at 10:54 AM
"Obama's Countrywide connection" is an inaccurate headline, since it is James Johnson's connection. And that connection is that he had real estate loans. Someone please get me the fainting couch.

Posted by: Bill June 09, 2008 at 10:55 AM
This is like a hot tomato and like McDonald's, I am not touching this one.

Posted by: MyLessThanPrimeBeef June 09, 2008 at 11:17 AM
That's just dumb. Really? Is there nothing else to report on regarding the general election today? Really??

Posted by: Sterling June 09, 2008 at 11:46 AM
As a retired business reporter who covered FANNIE and FREDDIE for over 20 years I can tell you that this kind of unholy alliance between big lenders and those two GSE's is endemic. The top executives of these two quasi public/private entities have raked in hundreds of millions over the years in unearned compensation simply because the implied federal guarantee allows them to take greater risks at lower cost. Then they pocket those lower costs. It's time to strip these two giant entities of any government backing, implied or otherwise. Until that happens expect more lenders to honey up to their executives as they did with Johnson.

Posted by: Stephen Pizzo June 09, 2008 at 11:53 AM
Obama crucified Hillary for Hillary's having a campaign manager, Mark Penn, who had lobbied for CountryWide. By Obama's own standards, therefore, this is no "cheap shot" -- it's a legitimate issue. (Even if it somehow isn't a big deal, it's clearly a sign of hypocrisy. Obama can't bash Hillary over the Penn-Countrywide connection and then expect no criticism over this, arguably closer, connection to Countrywide.)

Posted by: Gromit June 09, 2008 at 11:57 AM
Yawn
Posted by: Dan June 09, 2008 at 12:06 PM
Zoo-ey, that was a scintillating comment.
Now, as for being FoA (Friend of Angelo): it looks like being FoA really doesn't do much for you at all. According to media accounts, the loans that FoA's got were done pretty much at market rates.
This is all very sophisticated strategy:
1. James Johnson is to assume position of great influence.
2. It is known that if people look carefully into JJ's past, they will see all sorts of housing related muck.
3. Preempt serious digging by leaking the FoA story and making him FoA. The media swoop in and pronounce: "aha" and "got him" only to find that they haven't uncovered anything evil at all.
4. JJ and Obama go on their merry way, without worrying too much about being linked to the bad real estate guys again.
Strategists, what do you call all that? It's got to have a punchy name.

Posted by: Uncle Billy Tumbles Down Mont Pelerin June 09, 2008 at 12:09 PM
i wonder if these obama zombies could selfdestruct,dont worry,you will get your free house,and no need to head to canada,or mexico,no draft either,scocialism is so beautiful,free everything

Posted by: victor knopp June 09, 2008 at 12:13 PM
So, where is the connection to Obama? Someone that he just recently hired to start looking for potential VP's (As opposed to a policy advisor) is good friends of the CEO of Countrywide? OK, this isn't someone that will be in the cabinet should Obama win the Presidency, right? So, I guess I don't understand the dilemna. Also, seeings how countrywide is the biggest home lender, I think it would be near impossible to find anyone without a link to them....and some links may not be willful. Like mine for example. Countrywide bought my home loan from another company that bought it from the people I signed with. Does that mean that I am evil too?

Posted by: Chris June 09, 2008 at 12:13 PM
Just beacause home values are declining does not mean, every lender out there that lend money to people,last few years, a bad company, Plus when was the last time doing friends a favour a bad thing????Cheap shot!!!!! If you ask me!!!

Posted by: Raf June 09, 2008 at 12:14 PM
So, an friend of a friend does something and now we're connected.? Sounds like dirt at it's lowest level and not really worth reading except to know what is stirring.

Posted by: Keith June 09, 2008 at 12:15 PM
Don't worry Obama followers. Nobody seems to pay attention to any of his questionable dealings.

Posted by: Benny June 09, 2008 at 12:19 PM
Hehe. The only news sources pushing this smear have been Murdoch mouthpieces: The Sun, the WSJ, and Fox news. Surprise, surprise. I guess friend-of-a-friend-of-a-friend attacks just don't have the cut Murdoch wishes they do; he'll have to buy a few more papers before he can get anything out of something meaningless like this.

Posted by: Ruri June 09, 2008 at 12:22 PM
Big "F'ing" deal if Obama knows a person who received what essentially is just a major rate exception for their loan they they took out. As a soon to be former employee of CFC I can tell you that major rate exceptions were given all the time to alot of customers regardless of their background or who they knew. That's just the way the mortgage business is period!!. Plus the comparsion in the WSJ was not very strong due to the fact that it basing it's data on long-term fixed rates when these loans were clearly the much lower short-term arm loans that this person received when the rates were at their recent lowest back in 2003. I hate when information is so misconstrued!!!

Posted by: Soon to be ex CFC employee June 09, 2008 at 12:22 PM
I don't like Obama one bit. But this is a pathetic story. Friend of a friend took some big real estate loans at low rates? Boo, author.

Posted by: Ben June 09, 2008 at 12:30 PM
Hey......whether you like it or not, Johnson has friends in high places and also is expected to reward those friends who have assisted him. He will be calling in his markers and so will they. Don't tell me Obama isn't involved in this one. Just like he wasn't involved with his preacher's ideals??? Favors will be expected, and favors will be handed out. That's how it works. But when Obama stands up and says he is a "Change", surely he must be joking. Politics haven't and won't change. Let's not kid ourselves.

Posted by: Optomyst June 09, 2008 at 12:32 PM
Obamatons have to get used to the fact that this guy is "guilty by association" in ways that traditional candidates could never imagine. Just get used to it and get over it. And relax. Sen. Obama’s campaign may be able to withstand the occasional lazy headline by a Times’ blogger as crazy as that sounds. Now, if only we could do something EFFECTUAL about the falling number of hits to this blogs..."Yes we can reload LA Land 20 times a day for blog post we can believe in! " Hmmm, it could work...
Anyway, The AP reports that “Obama has asked a three-person team, including Caroline Kennedy, to help lead the vetting of a prospective vice presidential candidate. The other two members are Jim Johnson, and a legal advisor to the campaign, Eric Holder."
To get the full scope and scale of the uselessness of such stories, we really ought to know what CEOs of financial companies, rating agencies, banks and mortgage lenders Deputy Attorney General Holder and Ms. Kennedy have ever supped with and whether or not the wore flag pins at the time. It’s all related to SoCal housing folks - Think about.

Posted by: the problemwithcaring June 09, 2008 at 12:42 PM
I am neither an Obama or McCain proponent but the public should get ready for this kind of nonsense from the media from now until election in November.
The advantage of being in the media is that you have the opportunity to print literally anything you so desire and attribute it to the infamous "un-named source/annonymous source" and then rely on the Constitution to exempt you from liability.
Already the "media" and the party "spinners" have concluded how the electoral college vote will play out, which in essence is their way of deciding who shall be elected long before the candidates have an opportunity to truly expound on their agendas.
What this nation needs is an honest and unbiased media and folks, that is not going to happen. The era of the true journalist has long since past and we, the public, have to suffer this travesty into the forseeable future.

Posted by: dharper June 09, 2008 at 01:02 PM

Let's see... by this logic:

John McCain is friends with George W. Bush. Bush lied us into an endless war and committed treason by authorizing the release of the identity of a covert CIA agent...therefore John McCain is a traitor.

Case closed

Posted by: tommy June 09, 2008 at 01:09 PM