http://www.cnbc.com/id/15840232?video=659529306&play=1 More Write-Downs Ahead? 21 Feb 2008 The Citigroup research of Meredith Whitney, executive director of CIBC World Markets, triggered a staggering global selloff, and now she's warning that banks could face additional write-downs of up to $70B if bond insurers are downgraded. Expects best case for financials 15% downside. Worst case downside 50%.
I remember when she came out with her C call. It was going ex-div the next day and some guys were carrying over some longs with size thinking that we would gap up the next day, but C ended up getting smoked from then on.
I think there are more writedowns coming, this could be the an opportunity to go long, eventually the financials will turn around. Any more writedowns will bring the indexes to Jan 22nd lows.
Good thinkin' 'cept one or two ain't gonna make it. UBS has 3bb capital, by my information. Lehman, w/o really announcing w/downs yet, and rumors today, has 19bb. These guys take w/downs of 20bb, and go raise 5. That doesn't work for long.
im sure, probably be plenty of mergers in this sector as well......any 25-50% drop in financials and going long, long, long, long........
Meredith is not stupid, I'm impressed. But China could act as support for these banks, the banks fall, so does the world economy.
bull.. The BIG banks become small banks or die, the small bangs with tidy balance sheets become BIG banks. The Darwin theory.