The markets look higher this morning for what ever reason. I guess the absence of bad news means only that the shorts will have to cover some of their bets. I see no one "naturally buying" any stocks currently except for a few in the Tech/Pharma areas. My gut feeling is that we will rally (200-300 points)for a few days. Financials will also see some short covering here as Obama/Geithner/Bernanke cabal are saying the right things to make the banks and most importantly their lobbyists happy. But traders are just waiting for a better entry point to reload on the short side.
I will have more to say about the PACS & lobbyists and how they operate in an upcoming post, as well as Part 2 of CDS.....stay tuned.
News of Note-
JP Morgan is going to sell Specialist Firm Bear Wagner to Barclay's. Hmmm...Has the Bank Of England heard about this? Should they not be re-pricing their crap assets and rebuilding their equity capital instead of buying a dying business from JP? These managers are supposedly the smartest and most well educated people in the world, they should start acting like it. The value of a Harvard Education has taken a hit spiritually and philosophically of late, but I digress...who cares about that..its about getting paid isn't it?
This is a great deal for JP if they can pull it off and they will. Jamie Dimon is not only the smartest guy on Wall Street, but the most brutal. After JP cut its dividend yesterday it is now a certainty that Wells, PNC, BB&T, and USB will also follow that. Its ludicrous that these banks have taken Tax Payer Tarp Money, yet still pay out dividends. JP has their analyst day (Kissing Fest) today...they are also announcing they are cutting 12,000 Wamu jobs.
Bank Of America's Ken Lewis keeps talking about how great Merrill is going to be. How great Countrywide is going to be. How great BOFA is...To bad he wont be around to enjoy it...He is on his way out...bank on that.
GM posted a $9.6 Billion loss....enough said.
Jobless claims have reached 667,000 which is the highest reading since 1982. This will reach 700,000 before decelerating.
Obama is projecting a $1.75 Trillion budget Deficit....That is a conservative estimate...it will go as high as $3 Trillion before the economy gets its bearings back.
The US Treasury may break up AIG to keep it afloat....they have no choice.
American Express is paying people to close their credit accounts? I'm Speechless
Why is Yahoo not selling their dead carcass to Microsoft? Has not MSFT "Put it on the glass" enough? Google has just about finished eating breakfast, lunch and dinner here at this time. The only thing Yahoo is good for is free email, Fantasy Sports (beginning to suck), and Yahoo Finance. BTW- why is Yahoo in the business of relationship advise? Would you take relationship advise from a company that should have been sold $35 Billion ago?
Ahhh...in a very good mood this morning.
Happy Trading....Keep The Faith!
FITB +19.5%
ReplyDeleteRBS +30%
BNCN +19.3%
FITBP +10.7%
BAC +10.2%
There is no covering of short positions here. I'm specculating people are trying to make a quick buck on the fact that 750 billion was promised to help stablize things even further so financial stocks were going to be up today.
What do you think?
YoungApprentice-
ReplyDeleteWhen you see the volume figures for Example FTIB (77MM) yesterday. I would agree, there is some spec buying, but not from institutions. Daytraders are involved here. Most of the action is on the Buy-To-Cover side. Investors have shorted these thinking that bankrupcy is the only option, but like I wrote yesterday, nationalization is off the table until April at the earliest, unless something blows up. So Investors will take their profits on the short side. Institutions rarely get involved in any stock below 5 bucks....But in the final analysis....A Kiss Is Still a Kiss!
Thanks for the comments and keep them coming!