Bank of America Buying More Manure

If you put down a $2 bet in poker and then back it up with another $4 on the next betting round, spectators might think you have a good hand. But if you put down $2 billion and then back it up with $4 billion in an attempt to buy the pot, you had better know exactly what you are doing. Countrywide may be a good fit for Bank of America in name only, since the financial behemoth is the country's only true coast-to-coast bank.

The bank has a long, sad history of overpaying for institutions that ultimately deliver less than promised. Over the years, B of A has acquired many firms that were meant to shore up areas in which it was weak. Each time, it succeeded in bringing in more deposits from the customers of those firms, but alienated the core members of the acquiree. As a result, Ken Lewis has been forced to admit over and over that the expected results in the weak areas have not materialized.

Well no kidding, Ken. When you try to force a bank culture down the throat of another industry like investment banking, mortgages, insurance, hedge funds, wealth management, etc, it will never work. The only way to make it work is to let them run things under their own brand, business as usual. When you get bank people out of their element, you wind up with trouble.

Countrywide is a steaming pile of dung fresh from the bowels of the American consumer. It is what is left over from a series of poor decisions on credit (meaning millions of poor decisions, really). There may be a few diamonds in the rough there for B of A to scoop up. But it will get its hands very dirty in the process.