Mortgage Industry Trends

During the last two quarters I have felt a little like General Sherman at the start of the American Civil War.  When he publically stated how long and bloody the events were going to be, military planners retired him on suspicion of insanity.  He was brought back after folks realized he wasn’t all that crazy…the last three business days alone have brought considerable industry pain and surprises (i.e., survival M&A’s, funding, and of course downsizings).  We’re not done as the financial and mortgage markets are becoming increasingly consumed with survival – just survival.

I firmly believe that the US Financial industry is not only undergoing a “double bottoming,” but also a loss of worldwide financial status that is unlikely to be recaptured before 2010.  As written about in the financial times in several articles -- “US deal making enters state of transformation,” and “McKinsey warns US may lose financial leadership” --these leadership pieces reinforce my last six months of projections and underlying fears.  Until recently, I felt I was screaming into hurricane force winds – many thought I had lost my senses.

Furthermore, I believe analytical data and conclusions from the markets are starting to show that America is today where the British were at the end of the 19th century.  No longer a world power or economic powerhouse, Britain became a facilitating, non-prime player and sometimes a flashpoint for many of the world events early in the 20th century.  American firms (facing a similar challenge this century) are not prepared for this redistribution of wealth or the globalization of markets erasing 100+ years of comfort and management training.  Influence is clearly shifting to the East. 

For domestic businesses, they are completely unprepared for the next steps and very few of the BPO / KPO providers have any clue on how to help as they are only taking orders and making money.  The void is huge and it could take 5 to 10 years before it is recognized and then only in hindsight.  This could materially explain, using history as a reference, why the mortgage pain will linger as the financial markets reel and vary widely.  There is a permanent and fundamental shift ongoing and the roadmap is unwritten…

For the technologists, established providers, and the media reporters, it truly appears that there is a new currency and content change forthcoming.  How is your organization preparing for the next reality?