U.S. banks

A Fiction Called the U.S. Dollar

By Wednesday, April 11, 2012

U.S. TreasuriesPrior to the financial crisis, the Federal Reserve bought minuscule amounts of U.S. government debt. In 2011, the Federal Reserve bought 61% of all net U.S. Treasuries issued (source: Wall Street Journal, Mar. 27, 2012).

Reread that again, dear reader, to absorb its full meaning—61% of all issued U.S. Treasuries were bought by the Federal Reserve last year.

Before the financial crisis, it was foreign countries that were the … Read More

Bank Stocks: Is it Safe to Buy Them Now?

By Thursday, March 29, 2012

The big banks have steadily recovered since the Lehman Brothers collapse in late 2008 that sent bank stocks in a punishing downward spiral, which inevitably required hundreds of billions of dollars in bailout funds from Uncle Sam to save the U.S. banks from collapse.

In my view, this chaotic event was an opportunity that may surface only a few times and times of chaos are when you could make big … Read More

Half of the Eurozone Downgraded:
Time to Start Worrying

By Wednesday, January 18, 2012

After 36 years, France has lost its coveted AAA credit rating.

S&P downgraded France’s AAA credit rating one notch to AA+ late Friday, and the bad news didn’t stop in France.

S&P maintained its outlook as negative for the country, which means that there is a one in three chance of a further credit rating downgrade in 2012 or 2013, should France’s situation continue to deteriorate.

Considering the continued economic … Read More

Big Banks: Another Reason to Avoid Them in 2012

By Wednesday, January 18, 2012

As if the big U.S. banks didn’t have enough trouble.

Besides the large U.S. banks’ exposure to Europe and to the derivatives on their balance sheet (off-balance sheet items, which is why no one can evaluate what they’re really worth), there is another issue—a lawsuit—that could cost the big banks billions of dollars and negatively impact their corporate earnings in a significant way.

There is a private antitrust lawsuit that … Read More

Dangerous Times Ahead for One of America’s Largest Banks

By Wednesday, November 23, 2011

Back in October of 2009, I wrote a scathing editorial in the pages of PROFIT CONFIDENTIAL on my dislike for Bank of America Corporation (NYSE/BAC) stock (Why I Don’t Like the Bank Stocks). Back then, Bank of America stock was trading at $17.00; today it trades at $5.37. I still don’t like the stock.

So They Say the U.S. Housing Market
Is Getting Better? Read This

By Friday, November 18, 2011

Article Summary:  In Miami, realtor after realtor is saying that the biggest condo building bust in history has bottomed out and is rebounding with the U.S. housing market. Buyers are snapping up properties, one-third of them paying cash, and the best deals are gone. But Michael Lombardi thinks that this doesn’t reflect the true story. I was in Miami last weekend and realtor after realtor was telling me that the biggest condo building bust in history has bottomed out and is rebounding with the U.S. housing market. Buyers are snapping up properties, one-third of them paying cash, and the best deals are gone.

Not sure I believe them. Or should I rephrase that as, “Not sure they understand.”

We all remember when banks pulled way … Read More

My Bold Prediction on How the Euro
Crisis Will Play Out for America

By Thursday, November 17, 2011

The big news yesterday: Fitch Ratings service comes out and issues a warning for U.S. banks. Fitch may lower its credit ratings of the large U.S. banks if the eurozone debt crisis is not resolved. U.S. bank stocks got hit hard on the news. Bank of America Corporation (NYSE/BAC) stock now trades at $5.90 (I wrote months ago that I wouldn’t touch this stock).

Great News for the Bank Stocks;
But Why I Won’t Buy Them

By Friday, March 25, 2011

The big U.S. banks must be ecstatic.

After 100 people at the Federal Reserve ended their review of major U.S. banks, the Fed concluded that some of the largest banks in this country could increase their dividends, buy back shares and repay government loans.

Bank Stocks: Time to Jump in?

By Friday, January 14, 2011

All the news this morning is about JPMorgan Chase & Co. (NYSE/JPM) reporting that it made $4.8 billion in profit in its fourth quarter of 2010, beating analyst expectations again.

Why I’m So Bearish Going into 2011

By Friday, September 24, 2010

Wednesday, I wrote how I was immediate-term bullish on the stock market. My three main reasons for being bullish: corporate earnings for the third quarter would surprise on the upside; a cloud of investor pessimism still prevails over the market; and stocks are simply attractive compared to U.S. Treasuries that offer little to no return and that may be our next bubble to burst.

But, in the short term, for … Read More