Stupider And Stupider

Hi People.
Here's a story of how dumb the banks are.
Back in '08 I was doing a short sale for a friend who fell on hard times (He's doing much better now, thanks for asking). After months of being on the market we finally got an offer for $975,000 (we were on the market for $1.1M). A little low, but not bad.
We (When I say "we" I mean Brian Calvin who does all of my negotiating with banks on short sales. He has the right kind of temperament for it. I get my feelings hurt way too much when people are too stupid to listen to reason) negotiate back and forth with the banks (There was 2 loans) until we had an agreement with the 1st loan for $980,000 and they give the 2nd loan $3000. The 2nd loan said "jump in a lake, we want $30,000". The 1st loan told them to "go to that same lake and take a long walk on a short pier" (Walking into a lake and jumping into a lake will get the same result) you're only getting $3000.
So, we (You know who I'm talking about) go back and forth with the banks and they both will not budge. That kills the deal. No short sale. The property gets foreclosed on 10/09, about a year after the deal would have been done. The kicker?
Both the 1st and 2nd loans were with National City Mortgage, different departments but the same bank. The real kicker?
The house just went back on the market for $787,500. They lost nearly $200,000 because they could not play nice with themselves. Is it any wonder the banks are in the kind of shape they are in?
Let me know how stupid I am.
God Bless.