Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Old 08-09-2007, 01:54 PM   #61
Thinks s/he gets paid by the post
Milton's Avatar
 
Join Date: Apr 2007
Posts: 2,078
Quote:
Originally Posted by brewer12345 View Post
Have you, um, looked at the balance sheet of the typical US retail bank? Most of them hold securities, but the vast majority of these portfolios are treasuries, agencies, and GSE backed paper (i.e. stuff with implicit or explicit US gummint guarantees).
Point One: If you compare the Tier One ratios of US retail banks to other options (e.g., Canadian banks), you will see that the American banks are far from the most solvent.

Point Two: The ongoing weakness of the US dollar will effectively cancel out any capital gains that may occur. Are you, um, aware that the US$ has steadily declined relative to pretty much all major currencies over the past few years, with no end in sight? This trend will only accelerate if China pulls the trigger on all the US debt it currently holds (not saying that will happen anytime soon, but see China threatens to trigger US dollar crash - Telegraph). Guarantees issued by the federal government are increasingly suspect.
__________________

__________________
"To know what you prefer, instead of humbly saying Amen to what the world tells you you ought to prefer, is to have kept your soul alive". Robert Louis Stevenson, An Inland Voyage (1878)
Milton is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 08-09-2007, 02:05 PM   #62
Dryer sheet aficionado
 
Join Date: Jun 2007
Posts: 26
Anyone have thoughts on USB? Yielding 5.28% battered by sub prime fears and buffett pick.
__________________

roadtoharvard is offline   Reply With Quote
Old 08-09-2007, 02:59 PM   #63
Thinks s/he gets paid by the post
 
Join Date: Aug 2006
Posts: 1,361
I've bought it recently. We will see.

Quote:
Originally Posted by roadtoharvard View Post
Anyone have thoughts on USB? Yielding 5.28% battered by sub prime fears and buffett pick.
__________________
Hamlet is offline   Reply With Quote
Old 08-09-2007, 03:18 PM   #64
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
clifp's Avatar
 
Join Date: Oct 2006
Posts: 7,450
I have been looking to sell puts on USB in the hopes of picking it up lower. USB is one of the most profitable banks in the US. I suspect that the next year won't see a profit increase but with high secure dividend and PE in the 10-11 range, I am not to worried about dropping below 25.
__________________
clifp is offline   Reply With Quote
Old 08-09-2007, 03:24 PM   #65
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
brewer12345's Avatar
 
Join Date: Mar 2003
Posts: 16,391
Quote:
Originally Posted by Milton View Post
Point Two: The ongoing weakness of the US dollar will effectively cancel out any capital gains that may occur. Are you, um, aware that the US$ has steadily declined relative to pretty much all major currencies over the past few years, with no end in sight? This trend will only accelerate if China pulls the trigger on all the US debt it currently holds (not saying that will happen anytime soon, but see China threatens to trigger US dollar crash - Telegraph). Guarantees issued by the federal government are increasingly suspect.

Dunno about you, but I am a USD-based investor and I spend dollars every day, not euros or yen.

If the feddle gummint's money is no good anymore, I've got bigger problems than a few bank stock positions. And the USD circling the bowl is hedged via other ositions.
__________________
"There are three kinds of men. The one that learns by reading. The few who learn by observation. The rest have to pee on the electric fence for themselves."



- Will Rogers
brewer12345 is offline   Reply With Quote
Old 08-09-2007, 04:07 PM   #66
Thinks s/he gets paid by the post
 
Join Date: Aug 2006
Posts: 1,361
I'm investing in guns, canned goods, and gasoline.


Quote:
Originally Posted by brewer12345 View Post
Dunno about you, but I am a USD-based investor and I spend dollars every day, not euros or yen.

If the feddle gummint's money is no good anymore, I've got bigger problems than a few bank stock positions. And the USD circling the bowl is hedged via other ositions.
__________________
Hamlet is offline   Reply With Quote
Old 08-10-2007, 09:40 AM   #67
Thinks s/he gets paid by the post
wildcat's Avatar
 
Join Date: Feb 2005
Location: Lou-evil
Posts: 2,025
Quote:
Originally Posted by roadtoharvard View Post
Anyone have thoughts on USB? Yielding 5.28% battered by sub prime fears and buffett pick.
USB is a pretty conservative bank and as far as I know, they don't have much exposure to the subprime debacle. One of their gems is the payment processing biz. Good margins & cash flow positive unit that doesn't get a lot of attention.
__________________
"These walls are kind of funny. First you hate 'em, then you get used to 'em. Enough time passes, gets so you depend on them"
wildcat is offline   Reply With Quote
Old 08-10-2007, 01:06 PM   #68
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jul 2003
Location: Kansas City
Posts: 7,409
Quote:
Originally Posted by Hamlet View Post
I'm investing in guns, canned goods, and gasoline.
In the 70's it was freeze dryed food - 7 years worth.

heh heh heh - still have my 10% joint venture in a Patented gold mine from 1973 or so. And a few shares of UBS(not USB) - that's Swiss don't cha know.
__________________
unclemick is offline   Reply With Quote
Old 08-12-2007, 06:24 PM   #69
Dryer sheet aficionado
 
Join Date: Jul 2007
Posts: 38
I like BAC. Micro factors: At or slightly above its 52 week low; reasonalby low PEG; +-5.4% div yield; good at consolidating large acquisitions with accretion to bottom line and just bought Chicago's LaSalle bank; possibly largest credit card issuer in the world (has a government contract for same)= makes $ from fees; not "over"-exposed to mortgage lending;.

Macro factors: U.S. economy is stronger and more resilient than acknowledged by many ergo if economy does well banks nad BAC will perform accordingly.

Caveat: Fed will probably cave to political pressure to cut rates presenting increased moral hazard to responsible adults.
__________________
hayekcapitalist is offline   Reply With Quote
bac
Old 08-13-2007, 02:27 AM   #70
Confused about dryer sheets
 
Join Date: Aug 2007
Posts: 7
bac

Quote:
Originally Posted by hayekcapitalist View Post
I like BAC. Micro factors: At or slightly above its 52 week low; reasonalby low PEG; +-5.4% div yield; good at consolidating large acquisitions with accretion to bottom line and just bought Chicago's LaSalle bank; possibly largest credit card issuer in the world (has a government contract for same)= makes $ from fees; not "over"-exposed to mortgage lending;.
BAC does look pretty good, my getting in would be about $46.
__________________
rawg is offline   Reply With Quote
Old 08-13-2007, 01:51 PM   #71
Thinks s/he gets paid by the post
Milton's Avatar
 
Join Date: Apr 2007
Posts: 2,078
Quote:
Originally Posted by brewer12345 View Post
Dunno about you, but I am a USD-based investor and I spend dollars every day, not euros or yen.
Well, you can bury your head in the sand ignore the ongoing debasement of the currency if you wish. We are all free to make our own investment decisions, which is as it should be.

Personally, I look for the best risk-reward balance I can find, and am not wedded to any particular country or currency. And I like to travel and purchase imported goods (pretty difficult not to, these days).
__________________
"To know what you prefer, instead of humbly saying Amen to what the world tells you you ought to prefer, is to have kept your soul alive". Robert Louis Stevenson, An Inland Voyage (1878)
Milton is offline   Reply With Quote
Old 08-14-2007, 07:29 AM   #72
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jul 2003
Location: Kansas City
Posts: 7,409
I bellied up to the bar and bought BAC(then Fleet Boston) and good old JP Morgan in the 90's when they were getting hosed due to Argentina defaulting on loans.

Done good.

If nobody loves em again for a while - may buy some more.

heh heh heh - regular NFL season gets going good in September - also my usual stock picking time.
__________________
unclemick is offline   Reply With Quote
Old 08-14-2007, 09:50 AM   #73
Thinks s/he gets paid by the post
FIRE'd@51's Avatar
 
Join Date: Aug 2006
Posts: 2,322
I have noticed that the implied volatilities are lower on BAC options than some of the other big money-center banks. Could the market be telling us something about relative risk?
__________________
FIRE'd@51 is offline   Reply With Quote
Old 08-14-2007, 09:51 AM   #74
Thinks s/he gets paid by the post
 
Join Date: Sep 2006
Posts: 1,693
Quote:
Originally Posted by unclemick View Post
I bellied up to the bar and bought BAC(then Fleet Boston) and good old JP Morgan in the 90's when they were getting hosed due to Argentina defaulting on loans.

Done good.

I am mystified how with just a minor correction to see people talk of these bank stocks like they are the deal of the century. Bank of America is down 11% from it's all time high. In the early 90's BAC and JP Morgan dropped 75% from their high. In the last 9 years any gain from holding this stock is primarily the dividend as the stock is only averaging a 1.6% gain per year from it's capital appreciation.

Bank stocks are like auto stocks capable of wide swings back and forth. to get a little dip in them as we have so far does not make them comparably cheap as they were in the early 90's. The Fed and the capital markets are awfully worried about the state of outstanding loans to make this stock look like an absolute bargain. At 12 I'd be willing to look at it and think the worst was priced in. At this price you'd be thinking the liquidity squeeze and deflation of the housing assets as a non-factor to future performance of banking, a scenario that I do not see having hit any kind of a bottom.
__________________
Running_Man is offline   Reply With Quote
Old 08-14-2007, 12:10 PM   #75
Thinks s/he gets paid by the post
 
Join Date: Jun 2005
Posts: 1,543
Morgan Stanley is now trading below it's 52 week low. the others are getting close. earnings warning season starts after labor day. i would wait at least until next quarter's conference calls to see what their exposure is and what is the damage.

last numbers i heard with new lending standards something like 30% of 2005 and 2006 buyers are locked out of the mortgage market

there is just as much political pressure on the fed to keep rates than cut them. bernanke is going to be up for another appointment by the next president. if he holds rates it's going to be a democrat in the white house who is going to ride the white horse of bringing an economy out of recession. if he cuts rates than who knows what will happen. remember what happened with Bush/Greenspan even though it was really Perot who cost Bush the election. and the Fed is the least political job there. Reagan and Bush both complained about Paul Volcker and Greenspan and their high rates.


PPI wasn't exactly stellar today, so the chances of a rate cut may have just gone down
__________________
al_bundy is offline   Reply With Quote
Old 08-14-2007, 03:14 PM   #76
Thinks s/he gets paid by the post
 
Join Date: Sep 2006
Posts: 1,693
Quote:
Originally Posted by brewer12345 View Post
AFAIK, CSE doesn't do much/any subprime lending. They are basically a small commercial lender.

The market is tossing stuff out regardless of fundamentals or anything else. I think that financials and other hard hit sectors are close to finding a bottom.
CSE Down 12% today must be a bad day for small commercial lenders, bottoms are sometimes further down than they appear.
__________________
Running_Man is offline   Reply With Quote
Old 08-14-2007, 04:31 PM   #77
Thinks s/he gets paid by the post
 
Join Date: Jun 2005
Posts: 1,543
TMA

Thornburg Mortgage down 46% today. COO was on Larry Kudlow and said dividend is delayed and they are having trouble funding mortgages. He said only 38 mortgages out of 30,000 or so are in default.
__________________

__________________
al_bundy is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Bank stocks brewer12345 FIRE and Money 7 10-20-2005 12:30 PM
Swedroe comments on buying individual stocks. Nords FIRE and Money 27 10-12-2005 10:20 PM
Net Bank - Poor Customer Service Lancelot Other topics 7 09-22-2005 05:51 AM
Book report:  "1st National Bank of Dad" Nords Young Dreamers 9 03-21-2005 10:30 AM
Bank Preferred Stocks Jason FIRE and Money 1 08-19-2004 09:34 AM

 

 
All times are GMT -6. The time now is 02:42 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.