Heads Up on Banks
#21
Posted 21 January 2009 - 10:54 AM
#22
Posted 21 January 2009 - 10:54 AM
Mark S Young
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#23
Posted 21 January 2009 - 10:55 AM
#24
Posted 21 January 2009 - 11:07 AM
Mark what s your bank? I m transferring all my money there
TFSL
That's sort of a cheat, but I think it's indicative of many, many smaller banks who kept doing business the old fashioned way.
Mark
Mark S Young
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#25
Posted 21 January 2009 - 11:09 AM
I know very few here trade on fundamentals, but those who do should be advised that EVERY bank is going to be taking every single charge that they can right now.
Why?
Well, let's leave any government aid stuff aside for now. Look at things from a manager's standpoint.
You've got all the cover in the world to take losses now. Nobody will criticize you. If the stock goes down, well, that's a good time to re-negotiate your stock options portion of compensation. Then, next year, you're going to have a very easy time showing good year-over-year comparisons.
Now, I'm not the only guy to have figured this out, so expect many of these stocks to report "bad" earnings, and yet rally. Just know what it means and don't take the "bad news" at face value.
Mark
Mark,
I do agree with you about charges and banks. The healthy banks will take charges for sure...heck all banks will to set up future earnings. Reading into your statement makes me think your psyche is that a major buying opportunity is at hand in the sector....another possibility.
The problem right now is the current global G-8 financial system. We are talking about the insolvency of the UK, here. Look at our banks...BAC and C. This isn't about earnings, it's about survival. The markets are telling us this. The pound sterling is probably ground zero right now and needs to be watched closely. Any further rapid slide would flash serious warning signs.
It's time to throw away optimism and adopt realism. We are talking about institutions that are critical to the current global monetary system falling like dominos. It may sound like I'm gloom and doom but I'm not...just realistic here. I'll be the first to buy JPM, GS, BMO, TD, RY, etc at least for a trade when it looks like the crisis ends.
I took lots of ETF (bond/junk bond related) profits off the table and I'm waiting now. I'm watching high yielding assets (ETFs, certain equity groups) for a major buying op.
#26
Posted 21 January 2009 - 11:33 AM
klh
#27
Posted 21 January 2009 - 12:09 PM
#28
Posted 21 January 2009 - 12:23 PM
I know very few here trade on fundamentals, but those who do should be advised that EVERY bank is going to be taking every single charge that they can right now.
Why?
Well, let's leave any government aid stuff aside for now. Look at things from a manager's standpoint.
You've got all the cover in the world to take losses now. Nobody will criticize you. If the stock goes down, well, that's a good time to re-negotiate your stock options portion of compensation. Then, next year, you're going to have a very easy time showing good year-over-year comparisons.
Now, I'm not the only guy to have figured this out, so expect many of these stocks to report "bad" earnings, and yet rally. Just know what it means and don't take the "bad news" at face value.
Mark
You are wrong!
Well, actually your hypothesis is right on mark, just wrong about it being limited
to banks. Every CEO in every outfit has the best cover right now to write off all
loss items. So I expect a barrage of slashes in earnings in all troubled areas, just
not banks. This COULD pave the way for sudden improvement in subsequent quarters.
Edited by pdx5, 21 January 2009 - 12:24 PM.
#29
Posted 21 January 2009 - 12:32 PM
Edited by humble1, 21 January 2009 - 12:33 PM.
#30
Posted 21 January 2009 - 12:36 PM
Mark S Young
Wall Street Sentiment
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