bank stress test.

Discussion in 'Stock Market' started by wimpy77, May 7, 2009.

  1. wimpy77
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    wimpy77 Member

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    what do you guys think about the stress test results.

    10 banks need capital with bofa needing the most. some a now saying the market is gonna go downward ( haven't we heard that before). so what do you guys think?
     
  2. RodISHI
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    RodISHI Gold Member

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    I think they are getting ready to steal another boat load of cash from the taxpayers.
     
  3. manu1959
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    manu1959 Left Coast Isolationist

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    i think it is strange that the regulators suddenly claim to know what they are doing now.....

    do you know what happens if these banks can't raise the capital the gov't wants them to.....
     
  4. RodISHI
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    RodISHI Gold Member

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    Someone will have to do their job. Not a bad thing. They also get to look at all the books and see exactly who all has been involved in cooking the books.
     
  5. manu1959
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    manu1959 Left Coast Isolationist

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    i believe the government gets common stock aka voting stock....which means the government gets a seat on the board and gets to decide bank policy .....
     
  6. RodISHI
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    RodISHI Gold Member

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    I was looking on the FIDC site last night. Just a curious thing. They have houses for sale from banks they have taken over. There are ones in Detroit that more property taxes are owed on them than the asking price or best offer..... Even if a person could come up with a few thousand to purchase the houses they still have to pay those semi yearly tax bills and the past due tax bills.
     
  7. manu1959
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    manu1959 Left Coast Isolationist

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    from the article....

    U.S. to Wind Down Help for Some Banks

    Banks can increase common equity by issuing common shares to investors who hold preferred shares. The government is the largest such investor. The Treasury already has injected $209 billion into the capital reserves of the stress-tested banks, excluding MetLife. But the banks and the government both are eager to avoid converting these shares, which would give the government a significant ownership stake.
    yet they gave them a time limt to raise capital or they would be "forced to convert the shares.....

    Common shareholders dislike other forms of capital, such as money raised by selling preferred shares, because those investors have first claim on money available for dividend payments and a higher claim on assets in the event of a bankruptcy. Banks with too much capital from other sources have seen their stock prices drop as a result, in some cases threatening their viability. Regulators imposed the new requirement to appease these investors.

    look who is first in line if there is a bk.....


    While most of these banks will remain on federal aid for months, officials also said they would now allow some of the healthiest to repay the government's initial investments.

    now allow them to repay ....wasn't someone here saying they could pay back whenver they want.....seems that wasn't true.....
     
  8. wimpy77
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    wimpy77 Member

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    citi and bofa can't pay it back and but banks like goldman sachs of jpmorgan can. they may be forced to wait.
     

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