Thursday, November 8, 2007

Banks Bad

Don't be long MBL.AX or BNB.AX, seriously, they've been good, great even, just not right now.
Have a look at the way all the Investment Banks have been getting smashed offshore. Night after night we read about it. This is just last night's action;

  • Washington Mutual down more than 16% after management warned mortgage lending would decline to an 8-year low next year. Adding to woes, a further admission that as much as $1.3bln would need to set aside this quarter to cover bad loans.
  • Morgan Stanley down around 5%
  • Lehmans off 4.4%
  • Goldmans down 3%
  • Merrills both down 3%
  • and JP Morgan 2.4% lower
  • Fannie Mae down 10%
  • and Freddie Mac more than 7% lower
  • Capital One down 12%

If you are adding to your portfolio, don't add banks right now, there's more pain to come.

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