In yet another financial institution to post a loss and announce that they are raising multi-billion amounts of capital, Wachovia posted a 1Q loss and is raising $7 billion.  The company posted a .20 loss compared to $1.20 share previously.  They are cutting their dividend by 41%.  They are cutting 500  jobs.

This came as a surprise to the street and the stock got pounded relentlessly, falling more than 10%.  This was the second round of capital raising for Wachovia.

While we still think it is great that these financial institutions can raise capital saving something for shareholders and investors, we still think that the boards and executives must be held accountable for getting their companies into this situation once and for all.  How?  I am not calling for massive firings or anything like that, but better disclosure of the risk of the underlying investments and business of the company is certainly called for.  In addition, it is more than obvious that people received mortgage loans that never should have received them and this is one area where stricter guidelines are needed.  Should this be Federal Regulation?  No.  Part of the independent audits companies go through, possibly.  Something better and more creative out there?  I hope so. 

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