Following my report on the viability of the Top 12 U.S. banks, a number of readers have suggested that I missed Fifth Third Bancorp (FITB).
In mid November, Bank of American Corp. (BAC) ponied up more than $7 billion to nearly double its already existing investment in the state-owned China Construction Bank Corp., a move that gave the biggest U.S. bank a 19% stake in China’s second-largest lender.
Recently I took my girlfriend’s son to buy a large screen, flat panel TV so he could play his computer games with life size characters. The deal was if he saved half of the cost his mother and I would make up the other half. If you’re new to this computer game thing, it’s visual crack for these kids.
Off we went to the store where he had scouted out the best price on the unit he wanted. Wow, these things are expensive. As he stared in wonder at this digital behemoth, the sales person dutifully came up to close the deal.
As is always the case, numbers started flying back and forth between the sales person and myself; cables, warranties, delivery…
Profit in 2009: Think like a Fed governor… A “mere” 25 banks failed in 2008… proof that the FDIC expects many more next year… Retail on the brink… preliminary reports suggest holiday consumption even lower than anticipated… So who will thrive in 2009? An unsavory list of stocks prime to benefit from a lousy economy… Middle East moving markets… why news from Kuwait and Gaza is affecting your portfolio today… Byron King on the $200 billion consumer bailout Congress never passed
Right now, the conventional wisdom seems to be that the United States is looking at a “U-shaped” recession and recovery. Output declined gently in the third quarter, is dropping sharply now and will continue dropping sharply in the first and possibly the second quarter of the New Year, finally bottoming out and beginning a slow recovery thereafter.
Consumer credit could be the next “aftershock” of this financial crisis, says Jason Simpkins. Banks have suffered big losses on mortgages, and are now looking to reduce their exposure to credit card debt. This could be the death knell for the American consumer, and deepen the US recession in 2009.
18 banks have gone under so far this year. But how do you know if yours will be next? Keith Fitz-Gerald says the IRA Bank Industry Stress Index can be used like a financial X-ray to see what’s really going on in the banking sector.
Governments are hosing down the markets with bailout money. Central banks, meanwhile, are making sure the cost of borrowing is as close to zero as possible. We smell another bubble in the making…and another inevitable crash. Talk about priming the pump for the next bout of excessive exuberance.
U.S. stocks futures fell this morning despite yesterday’s barnstormer rally and heavy hints of a further rate cut by the Fed. “S&P 500 futures dropped 21 points to 917.70 and Nasdaq 100 futures fell 32.5 points to 1,275.50. Dow industrial futures dropped 200 points to 8,889.00,” according to MarketWatch.
Yesterday, US stocks soared. Today, Asia followed. Europe is up. More gains are on the table in the US.
Who can we thank for the jump start in equities? The mainstream press is tripping over itself to hail the efforts of our dearest leaders. Political titans like Silvio Berlusconi, Gordon Brown, Hank Paulson and, of course, George Walker Bush.
Bill Bonner is more skeptical. He says a bear market bounce is not cause for celebration; it’s cause for selling. Bill reckons the Dow will hit 5,000 before long.