Is C the new BAC?

For months, we were following BAC as the barometer for all that was financial. BAC had it all: Countrywide waste, new consumer fees, brand name shorts, and brand name entrants (albeit into preferreds), and more. It was easy to see it become a single digit, and then watch in wonder as it broke down.Viewing the remainder of this article requires a Subscription

If you needed a reason to avoid the financials

As a contrarian, I am often taking the other side of a trade too early, trying to catch a falling knife, looking for the turn, or whatever expression you want to use.Viewing the remainder of this article requires a Subscription

All the way to the bank

I feel bad harping on the banks. Over the past five years, they've lost about 60% and even since the market topped on April 29, the financials have lost 22% while the S&P 500 has lost about 10%.Viewing the remainder of this article requires a Subscription

Can’t look away

Up 300, down 300. It seems almost pointless to point out that the percentage swings on a daily basis, let alone intra-day basis, are so extreme that anyone trying to trade in the pockets is getting stopped out.Viewing the remainder of this article requires a Subscription

Banks will show us the way

Bank of America will soon approach its financial crisis low, and Citibank, despite a 10 for 1 split is back on its way to single digits. What are the implications? For starters, let's recognize that banks are still an integral part of the economy, as is debt.Viewing the remainder of this article requires a Subscription

It’s Not About Greece

For weeks, the media outlets have been streaming news about Greece - analysis, opinion, etc. - with the intention of shedding light on the internal situation.Viewing the remainder of this article requires a Subscription

New Home Sales

I'll spare you all the details which you can find at CalculatedRisk organized in always-useful charts, such as this: What you should know is that not only are we making new lows in new home sales, inventory is also up (not at new highs, but still up), meaning that expecting a recovery, or even a stabilization in real estate might be premature.Viewing the remainder of this article requires a Subscription

WFC and XLF

I haven't liked the banks in a long, long time. Earlier, I wrote about how the markets will struggle to sustain any bounce if the financials don't participate. And now, I see that Wells Fargo, WFC, is trading down 1.5%.Viewing the remainder of this article requires a Subscription

Quick note

As the markets hover down around 1-1.5%, I just want to point out the the financials are not providing any strength, nor are the recent performance leaders such as NFLX. In fact, it’s these same companies that are leading us down…

In the meantime, anyone who got into the commodity rally late (against my advice), and bought into CORN or similar ETF is going to face major headwinds as spec positions get routed:

Relevant ETF/stock: NFLX, XLF, CORN

Keep an eye on Citi

After hours it’s trading more than SPY traded throughout the day. It’s down around 3-4% as of this writing. The government is saying they might not be selling their entire stake; the implications around the tax benefits that Citi will retain has been a main source of reports, their secondary is facing a tough market. All in all, the financials won’t be able to lead this market in the near term.

Bank of America’s Bernstein Says Bank-Rescue Plan Won’t Work

Im not a fan of this space but at some point (NOT NOW) there has to be some viable lending institutions. Im not smart enough to know which ones will survive but my guess is that the smaller banks will present great opportunities to those in the position to take advantage.

Feb. 11 (Bloomberg) — The U.S. Treasury’s bank-rescue plan won’t repair the financial system or revive credit markets, Bank of America Corp. strategist Richard Bernstein said as he recommended avoiding the industry’s shares.

Treasury Secretary Timothy Geithner pledged up to $2 trillion in government financing yesterday for programs aimed at spurring new lending and addressing mortgage assets that are difficult to value. The government’s prior measures to prop up financial institutions included backing $118 billion of Bank of America securities and injecting $45 billion into the Charlotte, North Carolina-based bank after it bought Merrill Lynch & Co.

http://www.bloomberg.com/apps/news?pid=20601087&sid=apJRc8r_9GDE&refer=home