Since everyone else is busy blogging about Countrywide’s internal pride initiatives today, I thought I’d focus elsewhere. It’s actually buried in the Wall Street Journal article that focuses most of its word count buzzing about a former football player and his efforts to pump up morale in loan processing at Countrywide. (FWIW, if I were in servicing at Countrywide – particularly in default – I’d have plenty of company spirit right about now.) Countrywide Financial is likely to take a big hit during the third quarter as it writes down the value of the loans on its books, according to a Morgan Stanley analyst (who apparently has been reading this blog; industry sources had already noted the possibility of massive write downs in back in the first week of September). The analyst, Ken Posner, predicted in a new research report today that Countrywide could write off as much as $4 billion during the third quarter, driving a quarterly net loss of $2.47 billion at the Calabasas, Calif.-based mortgage company. From National Mortgage News, who covered the story:

… [the report says that] up to 60% of those assets [loans in inventory] might be considered “risky” and that mark-to-market writedowns could range from just under $1 billion to $4 billion. Mr. Posner has an “equal-weight” rating on the stock and says he believes it has “enough cash and cash flow to operate and repay financial obligations through 2008.”