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  • Bank Of America: Buy Before Everyone Else Does [View article]
    MER was trading in the $90s at the time, talk was $110 to $120, it was January of 2007.
    Sep 12 09:53 AM | Likes Like |Link to Comment
  • Bank Of America: Buy Before Everyone Else Does [View article]
    Merrill Lynch Wealth Management was the most profitable private client operation in the world, hopefully B of A doesn't change that, although I know it has changed (first hand knowledge), with regard to management, since the takeover.

    The book "All The devils are here" is a must read for all investors, especially B of A investors since it gives a very thorough description of the financial crisis and devotes two chapters on what happened inside Merrill and Countrywide. Merrill was destroyed by an incompetent CEO, Stan O' Neil, who refused to take advice of experienced traders and risk managers. Countrywide lost their way and like Merrill pushed aside executives who wanted to stop the madness when the signs of the eventual problems began to arise.

    One last observation, after you read the book it is obvious the total U.S. economy was on steroids of free and easy credit of amounts never seen before and certainly never to be seen again. Therefore, all the talk we hear about disappointing economic recovery is a little misleading since any comparison to the economy prior to 2007/2008 is always going to be disappointing when compared to that artificial high.

    However, there is a recovery, albeit not nearly good enough for many people, and given the level of interest rates, it should continue at subpar levels. The key, at least to me, is when QE ends next month will be the level of free reserves in the banking system (link below) which have been growing continuously as QE occurred. If the level of free reserves begins to decline as QE ends, it will be an offset to QE ending and should provide liquidity/credit to the economy and be good for the banking sector's earnings as they lend at better credit spreads. Inflation may begin to rise as a result of a decline of the free reserves, but that will is another discussion.
    Sep 11 09:42 AM | 5 Likes Like |Link to Comment
  • Peabody Energy Corporation CEO Says Coal Is Still On Top, But Is It? [View article]
    All your points essentially are political and represent the liberal/left/environme... view. That's fine, but when investing economics matter as well. Coal is a cheap abundant source of energy with the United States having some of the largest reserves in the world. This is an asset that will be used despite the current administration's disregard (and attack) for anything fossil fuel related that would help the U.S. in trade and/or competitive advantages for industries based on the North American continent.

    Presidents and their appointees change, thankfully, and when the current harmful crew (harmful to our economy, international standing, rule of law to name a few, but not all) leaves, coal will recover and Peabody's stock will be higher.
    Aug 20 07:41 AM | 16 Likes Like |Link to Comment
  • Merrill Lynch And Countrywide Financial: Huge Thorns In The Side Of Bank Of America [View article]
    John Thain was not the reason Merrill imploded. The guilty idiot that destroyed Merrill forcing ultimately the Bank America acquisition was Stan O'Neal, he is the former CEO to blame for Merrill's demise. Thain, actually made the best (for Merrill shareholders) of a very bad situation he inherited from O'Neal.
    Aug 3 12:25 PM | 1 Like Like |Link to Comment
  • Bank Of America's Insider Activity Is Puzzling [View article]
    There are blackout periods (certainly around the quarterly earnings report) where no buying or selling can take place in a company's stock for certain high level executives. Also, and more importantly, executives at BAC/Merrill get restricted stock (options were done away with years ago for most) EVERY year as part of their VICP ward (variable incentive compensation plan) with three year vesting schedules. Why would any of these executives buy more in the open market when they get it every year? As it vests over the three year period, it is very common for the stock to be sold for liquidity or diversification reasons (claw backs as well aka forfietures). Finally, BAC has over 10 billion shares outstanding, so the amount held by the so called insiders is small and has no impact on price. Looking at insider buying/selling on banks/investment banks is almost useless.
    May 23 12:27 PM | 3 Likes Like |Link to Comment
  • Bank Of America: The Crowd Is Dead Wrong [View article]
    As TincoMonkey states, the mortgage mess is mainly from the Countrywide acquisition. If they never made that mistake BAC would never be in the situation they are in now. Also, BAC is way more then just the old Bank of America from California. They were a serial acquirer in the consolidation of the U.S. banking industry over the last twenty years. The original bank/stock was North Carolina National Bank and some of their big acquisitions before BofA, California were: First Republicbank, Dallas / C&S/Sovran, Atlanta / Barnett Bank, Jacksonville / FleetBoston to name a few. Below is a link to show the creation of the current Bank of America.
    May 16 09:21 AM | Likes Like |Link to Comment
  • White House mulls massive reduction in power emissions [View news story]
    I really believe this White House does whatever it wants and legality of any action be damned, negative press is no worry since most of the media refuses to report on their abuses. It all stems from an arrogant belief of "we know better", which is so far from the truth.

    If this latest absurdity is ever realized it will only succeed in raising utility bills and furthering structural unemployment by reducing jobs in the mining as well as oil and gas industries. 2016 can't come soon enough to rid this country of the most incompetent and clueless administration we have ever been forced to endure.
    May 16 08:57 AM | 14 Likes Like |Link to Comment
  • Bank Of America: The Crowd Is Dead Wrong [View article]
    Nice article, but most of what you describe is dependent on economic growth, which seems to be slowing. Bank of America's share had been in a obvious up trend with good momentum going into CCAR. That is over and the suspending the dividend increase and buy back due to the accounting error clearly hurt the stock. Taking $25 to $30 billion off in market cap after disclosing the error seems excessive, but likely justified if they don't reinstate the dividend increase after a resubmitting and hopefully approval of their capital plan to the Fed.

    I have said in previous posts on BAC that dividends are very important for financial stocks since the industry's raw product is money and the management of risk and returns on that product. If a bank can't pay a dividend to their investor/owners, then the investor/owners will eventually entrust their capital to other banks who are better at managing risk and return.

    It seems BAC has digested the selling, as you stated, but it also starting to act like dead money and will drift with overall market sentiment. Long term, I believe the stock will eventually be higher as the bank continues to become more utility like with a focus on basic banking and wealth management (essentially their stated strategy). However, the utility like rating implies their need to pay respectable dividends and until they do, I don't expect any resumption of the uptrend.

    Finally, is Cramer really well respected? I guess it depends on who you ask, but he is wrong on so many calls that many people I know have tuned him out long ago.
    May 15 08:55 AM | 7 Likes Like |Link to Comment
  • Bank Of America: How Is Merrill Lynch Doing? [View article]
    Merrill Lynch was acquired for their wealth management business, which is the most profitable wealth management business in the world. Bank of America years ago banded Merrill on their platform/network and re-organized the private client and institutional businesses. Wealth management is integrated into the bank and has been contributing profits to BAC from the day it closed the deal.

    When you talk about Merrill you need to also highlight the wealth management business, which was and is the crown jewel of the company.
    Apr 28 09:05 AM | 2 Likes Like |Link to Comment
  • Government reportedly wants more than $13B from BofA over mortgages [View news story]
    TJF, I agree that choices for electing president are usually the lesser of two evils, but I do vote since that right has been paid for in blood throughout our history. I you don't vote, you should not complain about any president or elected official.

    The constant dishonestly by Obama and Holder is pathetic, but like you said most if not all politicians lie to varying degrees. I accept that, but it is the blatant disregard for the law and arrogant elitist attitude of we know better then you of the current administration and their seemingly ability to get away with it by a media (except fox as you stated) that refuses to report these abuses of power.

    Also, your statement "he has wasted tens of thousands of young American lives" seems excessive, you may want to check your numbers. You are quick to condemn the Iraq war under the now proven to be false pretense of weapons of mass destruction, but I believe that another geo-political reason of containing Iran was at play. Having the U.S. Military on their east and west borders should have provided the leverage to achieve the goal of keeping a fanatical religious country that supports terrorism nuclear weapon free. Of course if this was a goal, it has been abandoned by Obama with all the sacrifices made by the young Americans you speak of meaningless. By the way, I know some marines that fought in Fallujah and they didn't believe their effort was wasted at the time.

    Finally, I worked across the street from the twin towers when they were attacked and personally knew someone who was killed, as well as coaching (in pee wee football) the son of a father who was also killed in the attack. The war was brought to us and I believe the United States had no option other then to respond militarily. If you are one of those proponents who said/say it was a crime (9/11) and we should have responded with law enforcement and trials in OUR courts of law giving these murderers OUR due process of law, I recommend you go speak to the widow of my friend and the now high school student of the boy I used to coach who grew up without his father.
    Apr 26 11:14 AM | 1 Like Like |Link to Comment
  • Government reportedly wants more than $13B from BofA over mortgages [View news story]

    I guess you were responding to my comment (geodan, not geodon), although not sure why Bush is the main point of your comment. Of course, it makes sense if you are just another democrat that refuses to accept failure of any policy they enact and when and if failure does occur, it must be Bush's fault. The inability of this administration and their supporters to accept criticism or that they may be wrong is a major part of the problem.

    I don't believe any president and/or AG has the right to selectively enforce laws in part and/or against select segments of the population or use the IRS as a political tool. I believe that is unconstitutional and seems to be commonplace with the current administration.

    The old saying "one lie leads to ten thousand lies" has never been more relevant when looking at the past five plus years. If you have buyers remorse with Obama, don't blame others and please don't shoot the messenger.
    Apr 25 10:22 AM | 1 Like Like |Link to Comment
  • Government reportedly wants more than $13B from BofA over mortgages [View news story]
    Eric Holder should be in jail. He is the worst AG in recent history. Instead of enforcing laws, he believes he is above the law and his primary job is to protect the other incompetent office holder, Obama, who also believes he is above the law and does what he wants by executive orders. Both of these losers can't leave office fast enough. I only hope there is justice in the world and these two are disgraced when they both no longer enjoy executive privilege.
    Apr 24 05:19 PM | 10 Likes Like |Link to Comment
  • Bank Of America: Why Buybacks Are Better Than Dividends [View article]
    Share buy backs are fine, but have diminishing returns (less shares retired) in an environment of rising share prices (bull markets). In an environment of falling share prices (bear markets) they tend to be more beneficial since they will retire more shares and somewhat support the share price.

    However, shareholders that desire income and consistent realized cash returns may not view the option of selling shares to realize cash as viable since it may be at lose and producing negative yields (bear market environment). Dividends providing realized cash yields matter, especially for financial stocks regardless of tax consequences since investors have choices on which shares to own.

    As already mentioned tax situations vary over every class of investor as do the differentiation of accounts (IRA, 401, etc...). Having to pay taxes on investment income (dividends, cap gains), while distasteful is what is commonly referred to as a high class problem and can be managed in a variety of ways to reduce the amounts paid.
    Mar 31 09:43 AM | Likes Like |Link to Comment
  • Blow to government as judge recommends dismissal of case against BofA [View news story]
    This incompetent anti- business administration will never stop treating business as cash cows to be squeezed for advancement of their re-distribution agenda. However, maybe just maybe, the shakedown attempts in the courts will fail or be delayed until this administration fades into history as one of America's worst ever assembled.
    Mar 28 07:44 AM | 18 Likes Like |Link to Comment
  • Missed Lesson Of Great Depression And Financial Crisis Blinds Economists To Bubble And Coming Recession [View article]

    Thank you for the clarification. As I understand it now, you graph would indicate negative real returns for the next two years based on the previous seventeen year cycle extrapolated forward. It is interesting since the long term valuation theory on secular bull/bear cycles has a similar end point for the current secular bear market, that is if it has not already ended. A cyclical move lower almost seems certain given other criteria such as fund flows into equities (margin debt increasing), credit spreads (non-investment rated bonds versus highly rated/low risk), ridiculous price to sales ratios on certain groups of large cap stocks and IPO activity that has many companies going public with negative earnings and questionable prospects. Not sure 40% to 80% will happen, but 20% to 30% seems very real and could occur fairly quickly if sentiment turns and fear replaces complacency.
    Mar 24 11:04 PM | 1 Like Like |Link to Comment