Los Angeles

[Lizard]

So BoA is finally starting to address their multibillion $ problem. They booked  a $4.1 billion provision for loan buybacks, which was $1.1 billion more than they disclosed three weeks earlier, and wrote down mortgage operations by $2 billion.

Everyone knows they are sitting on tens of thousands of homes in their shadow inventory so such writeoffs should not be a surprise. I'm just surprised they were able to keep this going for so long. Now let's see if the other major lenders come to the plate and fess up.

Also will be interesting to see if BoA will be easier in their negotiating on their REOs. Right now they negotiate as if the market has recovered.

http://www.bloomberg.com/news/2011-01-21/bofa-s-writedown-means-moynihan-better-do-better-.html

[Prechter]

Since they are still only foreclosing on 3% or less of the houses scheduled for trustee sales each day in LA County, it's gonna take years before they've "cleaned up" the mess at this rate.  Better for them to pull the band aid off fast and put it behind over the next 2 quarters.