Comments (17)

Sep 17, 2008

Citi is already too freaking big...I seriously doubt that...

Sep 17, 2008
Devils Advocate:

Citi is already too freaking big...I seriously doubt that...

True... then again I would have said the same about BoA

Sep 17, 2008

I haven't heard anything along these lines, but I would absolutely not be surprised if it were true... subprime is so out; the new "hot trend" on the street is to create super-banks with $100bn+ mkt cap that are too big to fail... that is, until the stock price takes a hit from dumb mergers and the mkt cap drops to 90... then 80... 70...?

Sep 17, 2008

p.s. i think right now is an excellent time to buy MS... it's mkt cap is lower than MER, which is a bit ridiculous. In fact, buy MS and short MER... should be a profitable pairs, regardless of the direction of the market.

Sep 17, 2008

B2 - No offense, we rarely get into arguments on here, but that is one of the most ridiculous investment strategies I have ever heard. Why would you be shorting Merrill? If anything, buy Merrill, short .8595 shares of BAC, and take the $4.40 spread on the merger that currently exists. Based on these conversion prices, if the merger is consumated, Merrill would have an almost 20% jump.

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Sep 17, 2008

I don't know anything about trading, but I would short Merrill as a hedge against buying MS. My assumption is that MS will be bought out at a premium, thus making the stock jump. My further assumption is that if MS doesn't get bought out (b/c market conditions make such a merger impossible for whatever reason), the Merrill BofA deal will fall through, thus making Merrill stock drop. Since MS should be worth more than ML, and is currently undervalued relative to merrill, the MS jump will be greater regardless of the scenario. Of course, as I mentioned I don't know anything about trading; this is purely a hypothetical for shits and giggles, but it's what logic would tell me to do.

Sep 17, 2008
b2:

I don't know anything about trading, but I would short Merrill as a hedge against buying MS.

So when you say what you would do, you are freely admitting that you don't know what you are talking about?

b2:

My assumption is that MS will be bought out at a premium, thus making the stock jump.

Why would you assume a premium? Are you Dick Fuld in disguise?

b2:

My further assumption is that if MS doesn't get bought out (b/c market conditions make such a merger impossible for whatever reason), the Merrill BofA deal will fall through, thus making Merrill stock drop.

The BAC deal falling through would cause ML share price to fall but MS failing to get a sugar daddy would not cause this.

b2:

Since MS should be worth more than ML, and is currently undervalued relative to merrill, the MS jump will be greater regardless of the scenario.

Why should MS be worth more than ML? I'm not saying it's not, I just want to see your reasons - and one of them better not be "prestige"

b2:

Of course, as I mentioned I don't know anything about trading;

thanks for being honest

b2:

this is purely a hypothetical for shits and giggles,

That's one giant turd you have created and we're all laughing at it so you've achieved both goals

b2:

but it's what logic would tell me to do.

Does not compute.

btw, you can see from my username that I run Morgan Stanley - so I know how much toxic [email protected] we've got...

Sep 17, 2008

Morgan Stanley down 34% and GS down roughly 20% jesus...

Sep 17, 2008

It's as if the markets are determined to destroy the pure plays. Both MS and GS reported earnings above analyst estimates and now they're getting crushed. Looks like there's almost nothing they can do.

Sep 17, 2008

CDS jumps on MS and GS spell the end.... i thought you guys were so much better than everyone else? go fuck yourselves

Sep 17, 2008

just because MS beat estimates, doesn't mean that they are doing well. The worry here is about capitalization, a very real and serious concern for MS (probably the reason for the spike in their CDS spreads).

Sep 17, 2008

I appprecaite the time that you took to disect my post. Nonetheless, I don't need to understand the nuances of trading to understand business fundamentals. Strong logic skills are all that are needed to understand why my situation makes perfect sense. Come back in 2 weeks and you'll see how this situation plays out just as how the Lehman situation played out exactly to my calling...

Sep 18, 2008
b2:

I appprecaite the time that you took to disect my post. Nonetheless, I don't need to understand the nuances of trading to understand business fundamentals.

You think banking stocks are trading on fundamentals right now? How quaint...

b2:

Strong logic skills are all that are needed to understand why my situation makes perfect sense.

Since you haven't set out any of your thought process out, it's not logic skills I need - it's telepathy.
Once again, I'm not saying that your trade will not be profitable, I'm saying your argument is entirely unconvincing.

b2:

Come back in 2 weeks and you'll see how this situation plays out just as how the Lehman situation played out exactly to my calling...

Revisionist history. This is what you said:
//www.wallstreetoasis.com/forums/lehman-brothers-goi...

by b2 (Orangutan, 324 Points) on 9/10/08 at 7:27am
I expect a short-lived rally following today's announcement, as a result of whatever lies management decides to spew this time... when the lies become uncovered, the stock will tank again. buy now, short in half a week - sure way to make money.

When you wrote this, the previous days close was $7.82. If you bought on the opening tick, you would have paid $9.30. Let me be charitable and assume that you bought at the low of the 10th ($7 just before the close). Half a week is 3 days right? So you would get ready to short over the weekend and put your trade on Monday morning - where the high of the day was 30 cents. Congratulations - you just lost 96% in 3 days....

Sep 17, 2008

Oh, also, just FYI, censoring the word "[email protected]" won't keep your IT sweeps from flagging previous cuss-words that you're quoting... but, then again, the CEO of a major firm shouldn't be worried about getting a compliance call for inappropriate language on a message board, should he? :)

Sep 18, 2008

I already addressed this in that thread: 3 days means I would short Friday... Monday would be 6 days = 6/7th of a week. You're obviously not an MIT grad...

And the events played out exactly as I had dictated. There was a pre-market rally of 30%; the only upset was that Dicky boy lacks the gift of gab, so the rally lived much shorter than I expected.

Nice try though; want to play again?

Sep 18, 2008

...revisionist history. So having gone long on the morning of the 10th, you would have waited until Friday to close your position and go short (and if you were actually in the market you would know that "flip flop" trades are pretty rare outside of black box algo funds). And you would be happy to keep that short position going into the weekend with the following headlines on the Bloomberg screen:
"Bank of America SAID TO LEAD LIST OF POTENTIAL LEHMAN BUYERS"
"KDB may return for Lehman, MF Global Securities Analyst Says"
"PIMCO'S EL-ERIAN EXPECTS 'MARRIAGE' OF LEHMAN THIS WEEKEND"
"*LEHMAN SAID TO GET BIDS FROM BAIN, CLAYTON FOR FUND UNIT"

Maybe your bravado works on the high schoolers reading the forum but it ain't working on me.

And you're 16% offside on your trade today. Are you going to close it or let it ride? It might be easier if you get a second screen so you can see the quotes side-by-side ;)

Sep 18, 2008
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