Stocks

[stonegossard]

Originally Posted by dalakhani

The thing about the bank stocks is that there is money to be made with the yield curve the way it is. You have rates at ridiculous levels right now and you still don't have to write down all of the commercial losses...yet. Its pretty hard for a bank NOT to make money right now at least the ones that are capitalized sufficiently and have their contingent liabilities under control.

I am with the bears and have been but I think that this is going to be a lot more drawn out with a few more pops along the way.

I wonder when the banks will have to face the music and face up to the commercial real estate losses. They have to be huge. The gov't will probably let them hold off until 2080 to deal with that disaster. If they do it now some of these bank stocks will be trading at 50% of the value they are at now.

You are right about the banks and making money though. They can borrow billions for free and buy treasuries (instead of lending to businesses to help the economy) and make a few percent risk free/doing nothing.