drmalaka

These 32 Commercial Banks and Thrifts May See the Dung Hit the Fan

Reggie, as always a great article. You have so much back up information that those who throw barbs at you just do not want to do the work and understand what is really happening.

Ebuddy, Reggie did not say sell all those stocks, he has more articles and will select the best shorts. Your points are correct, so the answer might be that those are not on the short list.

The first comment is just a stick your head in the sand attitude. Trust the market, they know. First, don't forget the lowlife scumbags you are trusting. Second, how forward looking was the market in Q3 07 when it ran to new highs? What about NASDAQ in March 2000? To blindly follow that is idiotic, at least take a moment to listen. Read what Reggie and others have to say and then decide who you agree with.

There is very little room in these banks for defaults, it is not like they have a gross margin of 50% so a few defaults would mean nothing. Generally speaking, I would figure that losing all the principal on one loan would cancel out the profits of twenty five or thirty loans at least. If they lent out money at 10% interest the interest payments on ten loans of equal value would cover one complete loss. Then you have to factor in that they only make the spread between what they borrow for and they lend out. Add in overhead and costs and I might be underestimating the number of quality loans one complete loss cancels out.

Reggie you are spot on. If a bank holds a high percentage of these potentially zero value loans (and I agree with your hypothesis that a lot of these will be zero) then that bank is going to be in trouble. I love how you are going about this.

All those above who are so positive on this sector, do you really believe that housing will come back by the end of the year or early next? 11 month supply of houses compared to a usual 5.

The Coming Crash of 2008: A Result of Overleveraging

Judging from these comments I could not be happier being short. How come everyone is looking for a bottom six months after the top? The top was completely artificial, based on historically high PE ratios and net profit margins.

Stop looking for a bottom in these financials, these are criminal enterprises that stole billions of dollars from their shareholders and to think about investing in them is rediculous. The Fed told us yesterday that they will save the markets but they will not save equity investors in these crappy companies.

This is the same idiotic attitude everyone took with ABK, every other Friday there was a new rumor, first one sent the comapany to 12.5 the next one sent it up to 11.5 and now it below 6.

This economy is a mess. We Americans are a joke. We have spent so far above our means that we have no way to go but down. How many idiots took equity out of their house to buy a new Hummer with 22" wheels? Everyone in this country thinks they are entitled to live this incredible standard of living, flat screen tvs in every room, new lap tops, new cars every three years. Then we look to the government to bail us out. Where the hell do we think the money is coming from? Cool, we tried to help this recession with a stupid 150b stimilus package that we billed to our kids.

For all you bulls who have found a bottom, what makes you think consumers are going to be spending a lot in the comming months? With what money? With the money they have to spend on high priced gas and food because our Fed keeps inflating our every day expenses to save these criminal bankers who should probably be lined up against a wall and executed?

I have been praying for years to see $5 gas, I just can't believe it happened so quickly. There is nothing more satisfying to me than seeing the look on the faces of people spending $100 to fill up their SUV that they drive around in alone.

And for the economic illiterate that said if Obama gets elected then we will be in better shape. Please drop me a line, if he gets elected I would like to sell you all my stock. Yeah, a socialist is going to help markets. Taxing corporations and capital is the way to spur an economy on. Hmmm, who can do better with capital, smart people who made the money, or lazy, stupid, economically illiterate leaches that suck off of society?