[quote=“Edgar Allen”]SO I wrote a really long email in disgust to a journalist from the FT at the weekend - who had written yet another ill conceived piece claiming that the banks were responsible for all the mess and the governments move to rescind some of the fair value rules was essentially “handing them” them cash.
Was that completely dumb or should we hold journalists more accountable?[/quote]
We should hold journalists accountable for what they say outside of the op-ed page. There is a responsibility to get the facts right when you are a journalist, so say my friends who majored in that field. With the power of having all those people read your paper comes a responsibility to educate yourself on how your topic works. You may not have a mastery of it but getting the fundamentals wrong is embarassing.
In the op-ed page they can say it was classism that lead to Martians lying about their income to get sub-prime loans for all I care. Op-ed is their opinion, and if it was some journalist’s opinion that banks were responsible for everything that is wrong then let them write it. You exercised your appropriate response, which was to write back to the journalist in question and point out their mistakes. You should also think about sending it to the paper to get published in a “write in” section if they have it.
If they screwed up big then the paper will issue a retraction or a counter-point to protect their reputation.
Bob, you need a brokerage that handles forex trading. ThinkOrSwim has everything available for every account (although they may require some sort of approval process to get you past just the most basic level of buying and selling stocks).
Regarding bank stocks, may I suggest you folks look at FAS and FAZ. These are ETFs that trade at 3X the rise or fall of the banking index. They’re a great way to make and lose money very quickly. I did both last week. Oops.
That’s what I reckon too, though I dunno exactly why I reckon it. Anyway, thanks to everybody so far. I think that in the next few years this will develop into a really interesting little thread.[/quote]
I hope I’m not giving the impression that I think I know a durn thing here. What happened to me was I followed (as in watched) a tip maopo gave a while back, was astounded at the results, and decided to follow (as in watch and record) the things he advised as well as my own predictions etc. I in fact bought some stocks a while back and that was my wad. If they don’t come back I blew it. If they do I’ll sell some and buy the next up and comer. And I’ll look very closely at what maopo suggests, as long as it doesn’t get to complicated. I don’t have much time to chatter here these days but I thought I should mention again that I appreciate the input.
[color=#FF0000]note[/color]: I messed this post up by pushing the edit button when I thought I was pushing the quote button.
The new bit is…
[quote=“bob”] Anyway, what is the deal with the 3X? If those paid out 3X what you paid in you’d have made 120% in the last twenty four hours. Is that how it works? How do they ding you for 3X when it loses. [quote=“bob”]
They take it out of your brokerage account knuckelhead. And if you don’t have the funds in your account they send you a bill.
…
The old bit said something to the effect that the Bull market 3X ETF maoposquid mentioned were sure turning a profit just then. They sure were.
So Citi plummeted almost 20% last night to just under 3 bucks.
Is it a good time to buy?
Will it drop further?
Are they toast, or will they still be around in 20 years?
I wouldn’t touch Citibank with a 10 foot pole. Govt owns 36% of them and if they convert TARP into common stock it’s just going to rise. I would wait till the summer and reevaluate from there. I will admit at those prices I was tempted but the calls weren’t selling for enough for me to work out my investing strategy. The other big thing was having Obama in control with his poll-tested presidency, hence why we get Summers talking about restricting credit card rates last Sunday.
It seems to me dealing with bank stocks is just pure gambling. Buying stocks of companies making something solid would be a better investment strategy but less fun.
Anyone here ever buy preferred stock in these Banks? Ive been scooping them up everywhere, yields on these things are unreal, and I’m willing to take the risk that many of these banks wont go bankrupt/nationalized for some of these yields they are offering now. Some of you might be interested in them instead of these 3x leveraged financial etfs currently discussed
Yahoo Finance Symbol
C-PF Citibank 17.77%
C-PW Citibank 17.55%
BAC-PV BofA 12.80%
WSF Wells Fa 8.52%
I think the big issue with American banks isn’t that they are under capitalized. That is they have plenty of money. It is still the securitization issue. 40% of money available for providing credit in the US market comes from this type of recycled money. In fact that is the essence of the crisis as I see it. There are no buyers for securitized debt which previously provided 40% of capital available for mortgage loans. There are no viable insurance companies that can insure these securitized debt products to give them the AA ratings that make it possible for banks to hold them. However, without them there is a lot less money available for regular housing and business loans (40% less).
Then there is the issue of newly created securitized debt products finding a market in such a negative outlook with no viable insurance companies to improve their credit grade. This creates a problem for pricing because it is hard to establish a market for new securities. Without a market for new securities it is impossible to value the toxic securities. Then because that creates a crap shoot, it means that the toxic assets are now competing with funds that would otherwise be available for buying new securities. The reason for that is that the toxic securities at the very least have an element of shared risk with the US federal government. That improves the risk return on those securities but in turn increases the risk on newly created securities. However, without newly created securities there is 40% less money available for regular business and housing loans.
The 3X things is scary though because if you lose they ding your brokerage account. And if it ain’t in your account they send you a bill. Yick.
[color=#FF0000]Is there a financial bullmarket ETF that doesn’t do the 3X deal.[/color]
I mean a good one that people know about.
I can barely understand a lot of what you guys are saying here but banks stocks are going to yo-yo all over the place. Watch/buy and sell and a person could do very well I’d bet.
I think you could just read newsweek and watch CNN and get a general impression on whether the market is recovering, whether the banks are sorting out their problems etc. and then watch the thing like a graph. It goes up, people grab profit, it goes down. The lousy finacial reports that the news outlets predicted would have a negative impact come out, it goes down again. Prices look good, people buy, it goes up. People sell but not as much as before and it goes down, but not as low as it was.
Bank stocks are mostly so cheap that the trend will be more upish that downish as the economy slowly improves so that makes it even easier. I had a little nest egg that I put into solar stocks (I thought Obama was going to increase domestic employment, reduce the countries reliance on foriegn oil and do something about climate change all at the same time by subsidizing solar - dumb move) and I am “thinking” about selling them at a loss so that I can buy something like FAS.
The fucker in Taiwan is that it costs USD40.00 per trade so if you aren’t investing quite a lot and/or picking serious winners it doesn’t pay to piddle around buying and selling all the time.
And you can make a nice chunk of change doing covered calls. Profit wise was $850US for April and $920US for May, starting investment was less than $5500US. I use Charles Schwab, but I’m thinking about switching because stock trades are $12.99US and I’d like to get it to $9.99US per trade.
You are American (I’m assuming that - don’t know why exactly) though so you can set up an american discount brokerage account in Taiwan. I don’t think Canadians can do that. We could of course set up an account at a Canadian discount broker but the Canadian market is not nearly as depressed or as volatile from what I’ve heard (which hasn’t been much honestly so don’t quote me on that please).
Pretty much upish from the time this fiasco started. Now I hear that they want to pay back the loan they got from the federal government, mostly so they can pay their executives (themselves) what they want. Cheeky bastards.
Correct me someone if I’m wong on this but what I read was that the toxic debt of some smaller banks are being bought up cheap by the larger banks and in the end what this will result in is the consolidation of ownership in the hands of an even smaller number of institutions.
Nobody in their right mind at this point expects a general economic recovery in the short term. Production will fall, unemployment will rise and yet the stock price on a bank rises.
[quote=“bob”]
Nobody in their right mind at this point expects a general economic recovery in the short term. Production will fall, unemployment will rise and yet the stock price on a bank rises.
Weird, innit?[/quote]
Well not weird at all really. The banks are now allowed, due to shiny new government accounting rules to value any stock as they see fit, meaning that a lot of useless, valuless, unwanted stocks that should be worth nothing are now suddenly worth a lot on their books, as long as they don’t sell them this makes the banks look rosy, bringing up their value. Simple you see! And this is why China is shying away from the USD now. The rest of the world knows its a sham and they are slowly walking away. The U.S. is done, baked, over and so is its owners, the Fed and Bank of England.
China, through fear of being called “manipulator” of its currency again is now changing its USD for metals. Copper, gold, silver, steel, so many construction supplies for the future that they won’t need to care about their stock pile of USDs as they are now spending them to store up for the future.
Meanwhile the Comex is growing shakier by the month. People are realizing that these Comex banks don’t actually have the gold they have been selling. If countries start cashing in their gold paper, they will bring it to its knees and the rest of the giant banks with it. If that happens, then there will quite possibly the end of days for the banking sector, so that’s certainly something to keep an eye on.
[quote=“sulavaca”][quote=“bob”]
Nobody in their right mind at this point expects a general economic recovery in the short term. Production will fall, unemployment will rise and yet the stock price on a bank rises.
Weird, innit?[/quote]
Well not weird at all really. The banks are now allowed, due to shiny new government accounting rules to value any stock as they see fit, meaning that a lot of useless, valuless, unwanted stocks that should be worth nothing are now suddenly worth a lot on their books, as long as they don’t sell them this makes the banks look rosy, bringing up their value. Simple you see! [/quote]
That might be true but if I bought a bank stock today and it goes up tomorrow I could sell it tomorrow night at a profit. That is all I want to do. Take advantage of the awesome volatility that is coming. Check this…
Maybe you can take advantage of the volatility, but Taiwanese shares are a much better bet. Some people can’t see the wood for the trees. Taiwanese shares are still undervalued, loads of great solid profit making companies here, very low capital gains tax, very low transaction fees, solid currency…many have gone up 40% in the last two months and the stock market is still less than 6,000 and US risk offset by China and developing countries market…