XLF - Too Big To Fail for the Obama Administration?

Discussion in 'Trading' started by Daal, Feb 6, 2009.

  1. Daal


    Geithner is set to explain the bank bailout package in monday. Financial stocks soared on the rumors they will guarantee assets and inject convertible preferred. Will obama really bailout bank stockholders with cheap insurance and cheap capital as one of their first moves?
    The market thinks so
  2. Obama is so fair proving that he is even worse than Bush and just as clueless as the rest of the idiots.

    Expect nothing to really to change and the economy to continue to plummet
  3. Daal


    I'm still holding my short on banks because I just cant believe my eyes when I see the market optimistic about what the Treasury will do to shareholders. One of the first Obama moves is to bailout stockholders?I thought this guy was for change, Summers was saying the first tranche of Tarp was misused
  4. m22au



    The obvious answer is that we'll know exactly how generous the terms of TARP version 2 are early next week.

    Although Obama doesn't want to be seen being too generous, I find it hard to believe that the terms to be provided will protect taxpayers.

    So on one hand, I don't think C and BAC will go below $2, but I don't think they'll reach $10.

    I am playing these two by selling out of the money calls.

    If I get assigned, then I'm happy to hold the short position, or write a new bunch of calls with a later expiry date.

  5. zdreg


    is Summers to be believed

    you could get squeezed.
  6. the chick that did the interview is hot - who is she?
  7. Thanagar


    Amanda Lang.
  8. Classier then any CNBC chick!
  9. Daal


    Bloomberg reports the banking announcement got delayed to tuesday to let the Senate deal with the stimulus. This is likely to good news for the banks because if they will really bail them out they dont want congress to know before the Senate votes

    m22au, I think the shareholders get killed anyway, it doesnt seem too relevant that the government takes off the tail risk the table because the shareholders will get killed even under normal losses scenarios(not too hard when levered 10/20-1+ without counting off-balance sheet stuff), the tail will affect more the bondholder, depositors, creditors(Which I'm one, by having 8% of my networth in C bonds as some kind of hedge)
    #10     Feb 8, 2009