This is why it sucks to be a dedicated short seller or someone who “thinks” they know the balance sheets of banks. You have so much working against you, it’s absolutely preposterous that you try to making a living in such a way. The empire always wins, especially when you think it’s readying to collapse.
Gold is dropping again and is now in correction mode, down 10% from the highs. The Buffett for BAC deal means bankruptcy is OFF THE TABLE for BAC. Don’t even bother studying your bear thesis any further. It’s not going to happen with old man Buffett behind the bank. If you are short, cover it and move on. Moreover, if you are short banks, you have a problem today.
Having said that, I’m not interested in buying banks because it’s not my thing. I dancing to a different tune and have an interest to lighten up on rallies.
Bottom line: despite the tepid reaction of the market, today is a game changer. Once we get Jackson Hole behind us, this market will trade differently.
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just went negative !
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The market is not BAC.
very true !
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LOL. FIG!
You can’t buy the banks because they are made of shit. You can’t short the banks because of Nebraskan Mummies and other mollusks with dubious facial hair.
“Nebraskan Mummies”
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I’m jottin’ that one down !
Frickin’ hilarious !!!
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i dont like to short banks here. i do think that there is money to be made shorting especially if you pick the right stocks.
overall, i would net long this market though. high prob trade is to the upside regardless of jackson hole.
i just wonder how you conclude your high prob?
I think its time to start using the ppt with the assumption of bear market. Short the OB readings
I wasn’t but being short from $15/$20/$30 this would just be a burp along the way. Dedicated short sellers who short for the sole reason to see a stock go to $0 are just preposterous. Hypothetical entry at $15/$20/$25 and a drop down to $8 is a great short trade in my book.
Isn’t it great when Cramer tries to explain the selloff because of some “big sell program related to Germany”…
When actually it was everyone who was long and planning on getting out before the big Clam speech tomorrow morning instead decided to get out right now on the Warren Buffet gift.
Warren? Hi. This is Ben. Yea. So, I have an idea. Sort of a scratch each others back proposition. You’ve been hammered in the press for simply not “donating” to the Treasury since opening your yap about the wealthy paying more in taxes. I’ve got a problem with an economy sinking, markets in turmoil and banks on the verge of renewed collapse.
Here’s the thing Warren. How about you bail out BAC? You’ll lift the market, probably raising the value of your total holdings more than the 5 billion, whoa, yep, 5 billion, you’ll “invest”.
You’ll win and it will help offset my intention not to add stimulus on Friday. You Warren, you will be the stimulus. People love you. They trust you. If you are buying…they are buying. And you’ll get positive press for buying American. Sort of wash over that whole tax the wealthy thing.
Sound good? Ok. So thanks Warren.
Yep!
Shorted 5 mins after the open. So far so good. Maybe I’ll cover tomorrow when the market falls off a cliff again thanks to the mighty bearded one.
You sure are full of surprises, Fly. I noticed a big pelican kind of bird in the upper right hand corner, very much like the ones at my frog pond. Then when I refreshed the screen it was replaced by a Merlin the Magician character with a pointed cap with the moon on it.
I like it.
>>This is why it sucks to be a dedicated short seller or someone who “thinks” they know the balance sheets of banks.<<
You think Buffett "knows" the balance sheet? He said he'd never even looked at it until Wednesday morning… How much diligence do you think HE did?
I know Buffett knows balance sheets.
Sure, but any decent investor can read a balance sheet. It would take MONTHS to actually examine the quality (or lack thereof) of what that balance sheet’s assets, and there’s no way he was able to do that in a single day. I think he just “took a shot” here thanks to the 6% yield, the massive slug of warrants (which probably Black Scholes that yield into double-digits), and the seniority (to common, at least). I wouldn’t read any more than that into it.
I just saw over on ZH that they pointed out a liquidation preference for that preferred which puts the yield up to 9%. So if you factor in the warrants he’s probably somewhere in the teens with that paper.
Looks like the half life of a Warren save is about 30 mins.
Long = wrong.
lil wayne – gucci gucci http://bit.ly/no2UTZ
Buffet is rolling the dice, there’s no way he really knows this balance sheet. BAC has far more than $5 billion in capital needs.
More importantly, the fact that they needed this capital gives you the “tip of the iceberg” argument for the fact that there are many banks out there that are holding tons of crap and are going to have issues start to surface.
If you haven’t shorted yet it’s hard to do now, but buying them makes no sense either. There’s no way the market makes a sustained rally without the banks…whatever Fly-induced rally we see in the near term is an opportunity to raise cash and/or short.
Its going to be a “Short” day for the Longs