andrewh10

I-Bank Execs: Read My Lips... No New Capital

Lies, lies, and more lies out of the mouths of most financial CEOs these days regarding further capital raising and increased dilution. Even the foreign sovereign wealth funds coming in to fleece America’s so-called finest assets are finding themselves buying flawed diamonds because the balance sheets are not really what they thought they were. The backdoor deals going on now to desperately raise cash at C, MER, LEH, BX, and many others are quite disturbing. Why should the equity be rewarded in this type of situation? Wall Street always tries to sell and disguise as for the many talking head analysts like Richard Bove at Punk Ziegel who have been ringing bells saying time to buy financials. I disagree and think we are in store for some more pain in the financial sector especially the banking industry. It seems they have entered a new ball game but they are still playing by the old rules. We need to see more of the flawed and mismanaged firms like BSC disappear (bankruptcies are a natural way of taking out the trash and refreshing it with new companies) and only after that period will there be some nice buying opportunities. Many folks are bidding up the banks because of the favorable FED actions but this very positive low interest rate environment is about to get more difficult going out a few years.