Next week, I’ll be in Las Vegas for ASF 2008 — which ought to be a very interesting show to report on. There’s been plenty of discussion lately around what the future of securitization in the mortgage market will look like, and I’d expect to hear plenty more from the experts next week. My take is that the private label securitization market will rebound — eventually — although it will certainly look different in a few key aspects. Who’s winning? Just follow the trail of billable hours: I’ve mentioned before that lawyers were clearly cleaning up amidst the mortgage industry’s meltdown, and Friday alone certainly instilled in that notion a particular truthiness. Beyond Merrill Lynch being sued in Massachusetts and Countrywide being subpoenaed in Florida, there’s the not-so-small matter of UBS being investigated by criminal prosecutors looking to turn up evidence that the Wall Street firm improperly marked the value of mortgage bonds it held. And if that weren’t enough, the FBI got into the fray earlier in the week as well by disclosing that it had opened an investigation into 14 subprime lenders. I’m giving odds of 10:1 that New York AG Andrew Cuomo muscles his way into the headlines, somehow, next week. Cat and mouse: The industry lobby and the consumer lobby got along reasonably well during the housing boom, but that’s one relationship that’s clearly on the rocks these days. The latest spat took place this week, with the MBA’s chairman-elect David Kittle issuing some strong words for the Center for Responsible Lending on proposed ‘cram-down’ bankruptcy legislation. Kittle suggested the consumer group was more interested in pushing an agenda than fixing a problem, and the CRL responded in kind on Friday, saying that the MBA “offers no evidence” that the mortgage industry is making progress on modifications. The MBA — and, separately, HOPE NOW — have put out press statements in the past few weeks covering work-out efforts during the third and fourth quarters, numbers that FDIC chairman Sheila Barr suggested Thursday in testimony before the Senate Committee on Banking, Housing and Urban Affairs weren’t enough. Bair wants the industry to consider what Holden Lewis at Bankrate.com calls short refis, which entail forgiveness of principal and/or interest for troubled borrowers. While Lewis thinks the idea has some merit, I’m more inclined to side with Tanta at the Calculated Risk blog, who had this to say about the idea of short refis:

…I doubt it matters at this point. Really all Bair is saying is that servicers should modify down to the point where it’s no longer possible to go further without violating servicing contracts. Who actually disagrees with that? It is quite possible that it isn’t any better than doing nothing, but it’s possible that there are borrowers for whom it is, and I don’t see how it could be worse than doing nothing. So go ahead, everybody. As long as we all go first, there shouldn’t be any problems. However, if Bair thinks this plan will reduce stress on the FDIC, she’s crazier than I am by a long shot. When there is no longer “credit enhancement” on these loans, Ms. Bair, you’re the credit enhancement.

A little history: Via DealBreaker.com, a look at how we all got here, courtesy of National Mortgage News circa February 17, 2004, and starring none other than Countrywide’s Angelo Mozilo. That being said, Countrywide often gets a bad rap simply because it’s the largest. It rarely was first, as Joe Garrett and Corky Watts noted this week at Mortgage News Clips:

A press release from Royal Bank of Scotland made reference to “riskyâ€? loans. Somehow, we like that phrase better than high-risk loans. And we have the title for a new movie on the Sub-prime Crisis: Risky Business Part II. With Tom Cruise as Angelo Mozilo. By the way, the more we think about him, the more unfair we think the articles about him have been. If you think about every high-risk (oops, risky) loan product, we can’t think of one that got started at Countrywide. In fact, weren’t they even a bit late to the party with Alt-A and sub-prime?

That’s all for this week. See you at ASF 2008, if you’re headed there; if not, HW will be providing coverage live from the show. (Any questions, comments, tips or leads? Email [email protected].)