The seizure of Washington Mutual Inc. (WM) is quickly becoming a problem for Wachovia Corp. (WB). After federal regulators on Thursday night seized the West Coast thrift and its bloated book of failing home loans, investors have trained their focus on Wachovia, which itself holds piles of risky mortgages. Full Story but in the same breath they are going to hand over a 150 million dollar campaign to WPP as Wachovia said it has awarded its nearly $150 million creative and media advertising account to a WPP Group team led by Ogilvy & Mather after a review. Full Story
So they are in risk of being seized by the feds, but handing 150 million to WPP and Ogilvy & Mather?
What type of idiots work there? Last time WPP touched a bank … Lehman Brothers closed shop… WPP lost a client.. It’s like their toxic debt…
Plus we don’t know where Wachovia is getting this money from…. their Credit Insurance costs just hit the roof… The cost of insuring the credit instruments at Wachovia (WB) got just a little pricier in the wake of the collapse of rival Washington Mutual and the government’s failure to reach an agreement on a bailout of the financial services business. How much pricier? Put it this way – what Wachovia paid $670,000 for yesterday costs nearly $3 million today. Or about three and a half times more.
WPP feels this is a valid client as well as Wachovia feeling this is a valid way to spend money at a time like this?
no wonder these two industries are screwed… it’s the blind leading the blind.
You would think that wachovia would choose a smaller agency and reduce it’s advertising budget to brace for impact… instead they are spending every.. single penny left.. and handing it to perhaps one of the most expensive agencies out there…