Ira Artman

Touchdown: When Do Financial Stocks Hit Zero?

Thank you for comments. If you were dissatisfied with the above, then you probably won't appreciate the following, "Now & Then", either:

mortgagenewsclips.com/.../

Again, both the link above and the original article are about politics, rather than finance. Finance has nothing to do with the current state of banks.

Touchdown: When Do Financial Stocks Hit Zero?

Nyorker, kozanack and DVW:

Thanks for comments. James Bianco was talking about the fact that price weighting of DJIA can, when component prices are low (and below their own guidelines) lead to results that underestimate the 'footprint' that the companies represented by the stocks have on the real economy.

Don't disagree - of course he's right.

There is another issue too, which is more of a *political* issue than an economic or financial issue.

Specifically, at what point do firms with low stock prices and capitalizations (relative to their recent past) lose their standing as political players or as voices that are given consideration when political decisions are made with respect to their fate?

That's what I (at least) am wondering about. Extrapolation and line are simply devices to focus the discussion and make an impact.

Thanks again, for reading and comments. - Ira

Touchdown: When Do Financial Stocks Hit Zero?

The 'concept' as noted is a simple extrapolation, and of course says more about where we've been than where we're going. That's the point.

What is astounding is that for all intents and purposes, there's really not much difference between a $2 or $3 stock and a penny stock. What is truly astounding is that some of these $2 or $3 stocks sold for $30 1 year ago, and $60 two years ago.

Touchdown: When Do Financial Stocks Hit Zero?

FYI - Here is an interesting article from the Institutional Risk Analyst, discussing the differing treatment (and risk positions) of large and small banks:

The Big Banks vs. America:
A Roundtable with David Kotok & Josh Rosner
Institutional Risk Analyst: January 26, 2009


us1.institutionalriska...