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Don't catch a falling knife....There is always some market statistic that has not occurred since the crash. If you look hard enough you will always find correlations that forecast doom. However, I believe the market is overdue for a correction. It has gone up about 6,000 points in just over 3 months. If it goes down tomorrow, I'm putting in a buy using half the cash that has accumulated over the last 6 months.
There are always lots of layoffs and there is lots of hiring, over 220,000 new jobs created and the lowest unemployment this century.Don't catch a falling knife....
Just saying. Lots of layoffs are still happening in all sectors. Tech, banking, trucking/transportation, and etc. Wait for the correction to stop....however usually the value stocks tend to do better during corrections and stagnant markets.
Things like ET...these pay dividends and you end up with 8% on dividends alone every year plus the boost from demand. Using DRIP you tend to do well with these.
Energy Transfer has been great for me, way up and still an 8 percent dividend!Don't catch a falling knife....
Just saying. Lots of layoffs are still happening in all sectors. Tech, banking, trucking/transportation, and etc. Wait for the correction to stop....however usually the value stocks tend to do better during corrections and stagnant markets.
Things like ET...these pay dividends and you end up with 8% on dividends alone every year plus the boost from demand. Using DRIP you tend to do well with these.
That is not so.
Moody's cuts ratings of 10 U.S. banks and puts some big names on downgrade watch
Moody's on Monday cut the credit ratings of a host of small and midsized U.S. banks and placed several Wall Street big names on negative review.www.cnbc.com
Downgrading banks means the flow of credit will get tight. That’s when recessions hit and markets crash.
This is awful news.
Moody's cuts ratings of 10 U.S. banks and puts some big names on downgrade watch
Moody's on Monday cut the credit ratings of a host of small and midsized U.S. banks and placed several Wall Street big names on negative review.
Downgrading banks means the flow of credit will get tight. That’s when recessions hit and markets crash.
This is awful news.
I admitted It. OoopsDay #191 since ShortBus predicted a recession and ... nothing. Wrong as always.
You’re wrong. Some banks have to borrow as they lack deposits. Youre also wrong because many loans are at fixed long term rates that are way under market nowThat is not so.
They did not downgrade the banks. Only the FEDS can do that. They downgraded some of there more risky bonds. senior unsecured bonds to BAA1. These are some of the riskiest bonds banks issue and are not typically used in banks customer loan business.
Customers loans come primarily from deposits, not bonds. A secondary source for funding loans is the federal reserve and other banks which are avoided since the bank will pay much higher rates than what they pay depositors.
Today banks issue bonds to provide a range of services in capital markets which has nothing to do with the bank customer loan business. These services fall under categories that include mergers and acquisition, debt and equity underwriting, and trading services. These services are much risker than customer bank lending and thus financing of these services are through unsecured and high risk bonds which of course demand higher interest rates.
Thus downgrading these higher risk bonds should not have any effect on their customer loan business. It may impact other businesses these banks engage in today.
I admitted It. Ooops
Yes, they borrow but it is typically from the federal reserve (discount loans) or other banks (interbank loans). Using high interest higher risk bonds to fund customer loans does not make sense. You can bet these loans support capital management services that are risky but very profitable.You’re wrong. Some banks have to borrow as they lack deposits. Youre also wrong because many loans are at fixed long term rates that are way under market now
Banks that don't have sufficient deposits/reserves to support their loans borrow money from the Fed at the discount rate or from other banks at the Fed Rate. Generally this is the a better method of raising capital reserves than going into the bond or equity market but it does happen particularly with new banks.You’re wrong. Some banks have to borrow as they lack deposits. Youre also wrong because many loans are at fixed long term rates that are way under market now
Indeed not.So? Doesn't make you any smarter.
Look at EBC and the hit they took in 2023 because of its bond investment.Yes, they borrow but it is typically from the federal reserve (discount loans) or other banks (interbank loans). Using high interest higher risk bonds to fund customer loans does not make sense. You can bet these loans support capital management services that are risky but very profitable.
YepBanks that don't have sufficient deposits/reserves to support their loans borrow money from the Fed at the discount rate or from other banks at the Fed Rate. Generally this is the a better method of raising capital reserves than going into the bond or equity market but it does happen particularly with new banks. Commercial banks make their money by lending depositor money that they get for almost no interest. If they have to consistently borrow money to lend money, they don't stay around long.
EBC stock performance from it's peak in Nov 22 to the end of 23 is not much different than other small bank holding companies. What happened was the FED raised interest rates from 2.9% to 5.4%. Other small to medium size bank holding companies had similar loses in stock value.Yep
Yet it happens.
Again look at EBC and the giant loss they took. Care to explain what happened?
They lost $200mil due to a poor investment in a bond portfolio, forcing them to sell their insurance segment. They sold off their SNC portfolio at a $2.7mil loss. You failed to mention that it seems. Stock is one measure but it’s not the only measure. And my point was banks can mismanage deposits. EBC, SVB, First Republic, Signature Bank? How many more examples are needed?EBC stock performance from it's peak in Nov 22 to the end of 23 is not much different than other small bank holding companies. What happened was the FED raised interest rates from 2.9% to 5.4%. Other small to medium size bank holding companies had similar loses in stock value.
Not sure of the date but EBC sold a major core holding, in insurance and either merged or was in the process of merging with Cambridge, Bank. They seem to be narrowing their focus toward banking. There has been significant insider buying of the stock in 2023. Being a conservative long term investor, I would not be investing in small bank holding companies. However, if I owned this stock I would not dump it at this price level based on what I know now, which is not much. Keep in mind that if the Fed decides inflation is heading up, they will certainly start raising rates again and the stock price of EBC would likely take a tumble.
I didn't spend much time looking at it. I thought you might be considering buying or selling it. Bank stocks are not myThey lost $200mil due to a poor investment in a bond portfolio, forcing them to sell their insurance segment. They sold off their SNC portfolio at a $2.7mil loss. You failed to mention that it seems. Stock is one measure but it’s not the only measure. And my point was banks can mismanage deposits. EBC, SVB, First Republic, Signature Bank? How many more examples are needed?
The unemployment rate is 3.5%
No, it isn't, and people can easily look up how they arrive at that ridiculous number, so it doesn't make sense to lie about it.
It’s currently 3.7%No, it isn't, and people can easily look up how they arrive at that ridiculous number, so it doesn't make sense to lie about it.
