Any news of them trying to merge or sell themselves to anyone yet? If there is and no one is jumping at the opportunity I'd be worried. If things remain the same though it's a good sign. The Japanese bank is currently doing due diligence. If they push through with their capital infusion I might go long.
Mitsu deal is/was scheduled to close on tuesday. the deal is a few weeks old at 9B for 21%. I believe Moody's downgrade killed the deal but this is not confirmed.
Ratings agencies are idiots. They might supply useful information and analysis but it astonishes me how often their interpretation is baloney. They follow the herd.
Morgan Stanley is a broken chart and there is no doubt in my mind that bankruptcy of the entire company is a distinct possibility. Many of the companies out there that have traded like this have slipped into bankruptcy in a matter of weeks. I say that Morgan gets purchased for 2 bucks by JP, BAC or Goldman. You pick.
How distinct a possibility do you think is all of those banks going bankrupt? At some point there should be enough true value in some of them that a speculative run on them will be beaten back. Question is where do the falling dominoes stop? I think the mentality has changed sufficiently that what happened to Lehman will not be allowed to happen again. Moreover the banks still standing now are likely stronger than the ones that failed. More clarity will likely be shed in the coming two weeks. Worst case for shareholders for the banks mentioned is probably their stock holdings being diluted big time by a government buy-in like with AIG or as you say a takeover similar to that engineered for Bear Stearns. Who has money left to still buy though?
When they talk about 'Bank Holidays", the trading of bank shares are secondary. They are talking about shutting the banks.
1. It is a possibility that most of these banks will go bankrupt. During the last depression, 9000 banks went bankrupt. In this one, we have seen some of the larger institutions go belly-up or forced sold to other entitities. The last men standing I believe will be JPM, WFC and BAC. All others, to include Goldman and Morgan, will either go under or be force sold. If Goldman does not go under or force sold, then it will be a buy, but I wouldnt go in until it reaches at least life-time lows. I would stay far far away from Morgan Stanley. If I was employed there, then I would start looking for a new job. 2. No one has any money left to buy...even Warren Buffet is underwater on most of his buys in the last 3 years. There is no money out there on the sidelines. The SPY should test the lows of 2002-2003 and might just even go through those lows to about 50 or so. 3. Are we in a depression or recession? I believe this will be closer to the definition of a depression then a recession. The recessions of 2001 and the early 90s didnt feel like this. This feels much much worse. It seems much much worse. Whether the government wants to admit it or not, we are in a large scale recession or a small scale depression.
even Warren Buffet is underwater on most of his buys in the last 3 years. -------------------- Been following a few guru's comments, I'm pretty much going to put them on ignore, what's to learn? They may be right but is any of it relevant when no one acts? It is every man for himself. Re bank failures. One would expect the small banks to fail. We have failures starting from the top down. Isn't the brightest smartest money at the top? Conventional wisdom doesn't apply. What's is the small fish in the big pond going to do?