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Brian A. Davis » Comments » C

  • Why This Rally Is Unsustainable [View article]
    The fact is with the changes in FASB rules, banks were once again left off the radar screen...to continue to bury and elude the truth of toxic assets.

    That being said, rally by decree as opposed to rally on fundamentals is unsustainable.
    May 06 16:22 pm |Rating: +1 0 |Link to Comment
  • Financial-Dip Buyers Forget To Ask What's Next [View article]
    All of these banks in general, and mortgage exposed in particular (like BAC) are praying that the House and the Senate can stamp out a bill that will make the Federal government responsible for their trashy loans... Sounds more like the "moral hazzard" that was sounded off time and time again last week. Remember House members up up for re-election every other year... Who wants to be the guy who increases the national debt...bails out the big corporations...and weakens the dollar?

    Soon the euphoria will be over and the financials will not be allowed to celebrate "lower than expected losses"... and be treated like winners...

    Let's not forget that credit cards are teh next shoe to drop...and BAC has the highest exposure in that area!!!
    Jul 22 13:33 pm |Rating: 0 0 |Link to Comment
  • Big Ben's Credit Card Moves: The Good, the Bad and the Ugly [View article]
    Dear Readers,

    Continued growth of MA and V will be predicated on consumer demand.

    MA and V, have excellent business models. Both companies have healthy stock prices as well. MA and V are based on consumer credit transactions (which should see weakness in coming months).

    1. Over-spending
    2. Inability to service debt
    3. Default rates
    4. Tighter underwriting standards

    The ability for consumers to service debt will be tested. While this becomes more or less an issue for the underwriting banks, it will also effect the bottom line of MA and V. Furthermore, once a MA or V user defaults, then that customer is unable to continue transactions. Last, banks will continue to scrutinize customers with tighter underwriting standards. There will be come customers that banks will not want. These issues will effect the bottom line of MA and V.

    Respectfully,
    Brian A. Davis

    P.S. I do not hold positions on MA and V at the time of this article.
    May 06 16:50 pm |Rating: 0 0 |Link to Comment
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