About to crash

[JohnDB]

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.

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.

 

[Flopper]

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.

There are always lots of layoffs and there is lots of hiring, over 220,000 new jobs created and the lowest unemployment this century.

If you wait till you are sure the correction is over, the market will be back where it was before the correction started.

 

[MarathonMike]

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!

 

[Flopper]

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.

That 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.

 

[Faun]

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.

Day #191 since ShortBus predicted a recession and ... nothing. Wrong as always.

 

[AzogtheDefiler]

Day #191 since ShortBus predicted a recession and ... nothing. Wrong as always.

I admitted It. Ooops

 

[AzogtheDefiler]

That 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.

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

 

[Faun]

I admitted It. Ooops

So? Doesn't make you any smarter.

 

[Flopper]

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

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.

 

[Flopper]

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.

 

[AzogtheDefiler]

So? Doesn't make you any smarter.

Indeed not.
This economy is most puzzling.

I d Discuss it with you but you just want to hurl insults.

 

[AzogtheDefiler]

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.

Look at EBC and the hit they took in 2023 because of its bond investment.

 

[AzogtheDefiler]

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. 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.

Yep

Yet it happens.

Again look at EBC and the giant loss they took. Care to explain what happened?

 

[Flopper]

Yep

Yet it happens.

Again look at EBC and the giant loss they took. Care to explain what happened?

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.

 

[AzogtheDefiler]

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.

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?

 

[Flopper]

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?

I didn't spend much time looking at it. I thought you might be considering buying or selling it. Bank stocks are not my
thing.

 

[DudleySmith]

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.

 

[DudleySmith]

Bailing out crooked banks is just business as normal. Don't look for either Party to stop the subsidies for banks are any other industry, cuz 'free markets n stuff'; they just focus on whining about minimum wage and how that cuts into dividends and gains.

 

[Faun]

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.

Thar wasn't necessarily a lie.

 

[otto105]

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%

They’ve been counting the numbers the same way for decades fuck up