Ok, after listening to Mozilo interview with CNBC, I decide to buy 1 more lot of CFC. This is why.

1.  My  interpretation of him is that he is a good CEO and on the shareholder side. He is the largest share holder. If the stock is down, he is down. Yes he is selling, only because he doesn’t want to dump all of them at once when he leave the company.  His min. selling price is $28. So I am betting CFC will go as high as $28. I think he chose that number for a reason.

2. In time of crisis, I think he hit the money by clearly identify the problem. It’s not the numbers, it’s the people, the panic people, who are rushing to take the money out of bank, forcing CFC to tap into its credit line. I believe he came on the interview for the biggest of reasons, to re-ensure confidence, which address the core problem. An insight of showing, he knows what he is doing.

2. 4 or 5 major institutes had faith in CFC and willing to make major investments. I know Buffet would not invest in anything that’s not well run. and i am sure the bank went through all the numbers.

3. One down side is, it seems Mozilo is thinking about retirement. CEO has alot to do with the performance. So CFC might not be a long hold, not sure when he is leaving. But if he is a man of integrity, I believe, he will only leave after CFC recovers from this crisis. So within a year or two, I am willing to invest in CFC

4.  A catch thou, of course, he could be so smart and conceivable, he is selling for his own good, blah blah, its a cover up for a big mess underneath. But i believe if BAC can dump $2B into, I am willing to go with Risk.

5. Remember BAC $2B is like purchase the stock at $18, meaning their measured margin of safety is about another $4 from the current $22. Definately buy at $18, but even at $20, maybe $22, with smaller margin of safety is a good choice of us small investors, since we don’t have a big price tag next to our yet-to-know prominent name.