14 replies to this topic

[dcengr]

This is a chart of BKX overlaid with ad-cum and HGX on top. Note that since about april 05, the A-D cum line of bank stocks have been tracking the HGX.

If the recently rising interest rates continue, what consequences does it bear for HGX and perhaps BKX?

Remember that a bulk of the earnings rise in the S&P are attributable to energy and financial sectors.

Edited by dcengr, 14 January 2007 - 05:07 PM.

[snorkels4]

related?? all the same market



My Webpage

[jawndissedi]

Housing and banking have just begun to accelerate. Here's my new favorite indicator:

To da moon!

Edited by jawndissedi, 14 January 2007 - 07:27 PM.

[dcengr]

Housing and banking have just begun to accelerate. Here's my new favorite indicator:

To da moon!

All the money coming out of realestate and going into techs!

Just like all da oil money going into techs!

Soon we'll have all the bank money, all the bond money, and anything else dropping going into techs.

[spielchekr]

We're in the midst of feeling a very offsetting uplift.

(excerpt from Contrary Investor):

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We'll leave you with an excerpt from a recent (November '06) Fortune interview with Treasury Secy. Paulson. And we'll also leave you with a question to ponder. Is this personal conjecture on the part of Paulson, or is this simply implicit policy at this point?

Aren't you concerned that GDP growth dropped to 1.6% in the latest quarter? That's kind of anemic, and we've seen a downturn in the housing market. Convince us we're not going to have a recession next year.



"I can't convince you. But as I looked at the third quarter, I felt good because I saw a major correction in the housing market, and I knew that was going to take more than one percentage point off GDP. And then I'm looking at the rest of the economy - strong corporate profits and investment, good growth outside the U.S., strength in the construction sector away from housing, and then an equity market that has gone up and added $1 trillion in value.

I know how much people care about housing. But I would be quite hopeful that through 401(k) plans, pension plans, and elsewhere that the average American is feeling an uplift from the appreciation of the equity market that would be very offsetting to any potential decline in housing."

[jawndissedi]

We're in the midst of feeling a very offsetting uplift.

Ya think? Mebbe Secretary Paulson should get a hold of some of those folks who are losing their homes and let 'em know that they should sell some of their stocks to keep the sheriff from tossing them out on the street.

Edited by jawndissedi, 14 January 2007 - 10:47 PM.

[dcengr]

We're in the midst of feeling a very offsetting uplift.

Ya think? Mebbe Secretary Paulson should get a hold of some of those folks who are losing their homes and let 'em know that they should sell some of their stocks to keep the sheriff from tossing them out on the street.

No paulson is saying they should sell their houses for a loss, and recover the losses in the stock market.

[spielchekr]

You're trying to tell me you can't feel that uplift?

How many shares of the Dow Jones Industrial Average does it take to buy the Average U.S. House?

Average U.S. real estate price divided by Dow Industrial

[eminimee]

Question:...Are higher or lower 20 year rates going to be good or bad for banks....or won't make any difference? My take is...banks prefer longer term rates to rise because they want the decent spread between borrowing short and lending long..the bigger the spread the better.....if ZB is about to break up out of wedge...rates should continue back down and bkx's have a good IT top in.

[jawndissedi]

Question:...Are higher or lower 20 year rates going to be good or bad for banks....

Very unlikely that higher rates are good for banks, IMHO. In any event, the best opportunity of the coming week may be a further selloff in ZB prior to the CPI. I will buy ZB if 30-yr. rates are > 5%.