Bank of America is now being urged to reconsider their Countrywide bid. Ari Levy and Christopher Stern, Bloomberg News, report that Sen Chuck Schumer (D-NY) wants BofA to consider cutting the $4 billion price tag for the deal. Investors have speculated that Bank of America may seek better terms or cancel its takeover of Countrywide...

It looks like earnings are really driving this market over the last few weeks as investors are looking for signs of stability. Last week Google helped drive the markets higher. The week before GE helped to drive the market into the ground. Looks like it is Bank of America's turn.

The financial sector led a furious stock-market rally Thursday, with banks and brokerages snapping back from a deep selloff a day earlier, while commodities prices continued a rapid retreat from record levels.

This is a great article which lays out how the Countrywide deal came about and how much short term pain Bank of America may be in for.

Article about why Bank of America's purchase of Countrywide will be a great investment. Bank of America will endure some short-term pain because of Countrywide's mortgage portfolio but the long-term benefits of gaining Countrywide's market share, infastructure, network, and distribution are larger.

All their current problems arise out of the tanking of their banking business, since investors no longer have the confidence to make deposits, or even keep existing deposits with Countrywide...So what should be the solution?

Countrywide Financial Corp (CFC) Chief Executive Angelo Mozilo said he doesn’t expect the largest U.S. mortgage lender to file for bankruptcy protection, saying the “elements are certainly not there.”

By DAMIAN PALETTA, VALERIE BAUERLEIN and JAMES R. HAGERTY
January 10, 2008 2:37 p.m.

Bank of America Corp. is in advanced talks to acquire struggling Countrywide Financial Corp., according to people familiar with the situation.