AndrewBaker

Wall Street Breakfast: Must-Know News

More talk about how to regulate, but not enough about how we can pick up the economy. Big committees paid for with tax dollars may be able to create a lot of fake jobs, but they won't create one new widget or anything else that will help turn things around. If regulation made for economic success, we'd never have got into the mess we are in in the first place.

Smart talk has moved the markets up too high: now watch reality kick in, and see how in October the false "recovery" gets seen for what it is, and watch the markets fall back. And this is what we need, genuine pricing in the markets, before any real recovery can begin.

Wall Street Breakfast: Must-Know News

Wow! This article is being read by those on the happy bull pills that the government seems to be handing out now: my comment above put in a jocular way about the market opening higher for no sensible reasons and needing to come back down to reality has been thumbed down by most so far. Are these the same people buying this market? If so, then I won't be so sorry when it falls and they lose some of their shirt for buying because they were afraid to miss out on the so-called bull market and greedy enough to try to catch a lift up before they missed it. Truth is though that this market is coming way back down and will stay down before it gets to go back north again.

And doubleguns very good comment about letting the banks fail is slated too. Maybe it's bankers as well as substance users on here today (and some politicans too, perhaps?)

I want a rising market but an honest one, pleeeease.

Wall Street Breakfast: Must-Know News

We've just opened: up! What is it the government has had put into the water or air supply? The markets' are not the only things on a high, and if we go into the weekend up, I'm gonna demand my own private supply of whatever it is, 'cos it'll be the only way I could stop myself going gaga before Monday comes around/ And if we're not down then, I'm gonna od on this stuff.

Wall Street Breakfast: Must-Know News

So bankers get bonuses greater than the banks' net income. This is history, not news; and a shame on bank bosses and politicans who rely on money from that source for campaign funds and more. The big banks just carry on with their profligacy, whilst the smaller banks get treated harshly to enable regulators and others to opine that they are doing their job and cleaning things up.

Banks are raking in the cash right now with low interest on their borrowed funds and high charges on their loans; and just hoping to make a buck before the bad debts currently being hidden away, and still growing in all loan books (mortgages, cars, credit cards, personal loans, commercial mortgages et al), finally get into the path of the fans that will blow them up against not just the walls but into our faces too.

Momentum traders are doing well now, and I hope that they are quick in getting out when the northbound momentum fails, and the southbound takes over.

Wall Street Breakfast: Must-Know News

Tucked away at the bottom today is the news another five banks have gone under, with assets stated as $1.04 billion. Given the likelihood that the smaller banks were better run as regards keeping an eye on lending quality and therefore ultimate profitability, what does that say about the assets of the "too big to fail" banks and financials?

The answer is of course, very little that is any good. Waiting for the real and bad news about the banks' bad assets is like watching a car crash in slow motion: you see it happening, but it seems like it's taking forever.

Maybe if each of us told three people that bank stocks must be sold and for them to do so and tell three other people the same, the message may get home just a little sooner: falling stock prices will alert people more than anything else, and the false hype that's keeping them up won't have so much affect then. Worth a try!

Wall Street Breakfast: Must-Know News

As axelrod608 so correctly pointed out above:

"...So despite making easy money on new loans, they have continuing writeoff losses on the junk.

There's a LOT of junk left, thus a lot of losses yet to be booked. And if the economy keeps deteriorating, the losses will keep coming and growing. "

You can't build a sound house on rubbish foundations, and no matter how easy it is now for banks to make money on new business, they still have the old rubbish hidden away underground to deal with, and with more jobs and homes being lost, the write-offs and bad debts will only get worse, and the decay from below(before) will cause the whole new build to collapse unless something is done, now.

The first cracks are showing from the smaller banks first for obvious reasons: and it worries me about the eventual losses from the big boys, which are coming; and it'll hurt when they do.

Wall Street Breakfast: Must-Know News

Funny, but I don't see much today about how badly the banks and related financials are doing. They get downgrades, here and in Europe and elsewhere, and more people are renaging on their credit card debts, and commercial property in the US is plunging in value because bank loans taken out to buy it are not being paid, and yet the "green shoots" brigade are carrying on without a care in the world and ignoring bigger bank losses to come.

Example: The John Hancock Tower in Boston was bought at the end of 2006 fpr $1.36 billion; the company who bought it failed to meet their loan payments, and in the foreclosure auction on 31 March this year, less than 3 years later, only one bidder turned up and bought it for $660.6 million. More than 50% off the previous buy price!

There are other examles, plus does anyone think credit card payments are going up any time soon? No, of course not. And I haven't even mentioned mortgages and other loans

If you want more alpha, sell those bank shares!