What Does Warren Know?

If you had the steel nerves to buy thousands of shares in Bank of America stock a few days ago at $6.01 each then you woke up this morning to the happy news that Warren Buffett will invest $5 billion in the struggling megabank. If you bought the stock at just over $6, your two-day return would be 29%. Not bad. I guess the news means that B of A won't be merging with another institution any time soon and that it's not a candidate for a federal takeover. Still, B of A is a major focus for mortgage professionals everywhere. (The bank – the nation's second largest funder – held a company wide conference call the other day to dispel rumors that major parts of the company are on the auction block.) Loan officers, we're told, received a clear message that B of A is committed to retail residential lending but as for its other lines of business – warehouse finance, correspondent purchases and servicing – those matters are from settled. And the bank refuses to provide any details regarding its MSR sales. Maybe Warren knows…