Time to short financials?
Time to short financials and pe how to get exposure? Just regular short(worked good in 08) or exposure via call options
thoughts?
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Are you just shorting Fin? Or are you trying to make some kind of a prediction through shorting fin?
It is a bit hard to do the first because they basically have a blank check and are making a killer spread. I would try to find an industry the gov't has not tried to F*** with yet and short that in anticipation they will get to it.
some of these banks earnings are going to go down bc of prop but the questions is will it be this quater of next quater that suffers the big hits
My guess is that MS is going to have a big Xmas surprise where they lay off 10-15 percent of their workforce. Also, try to short anyone who has a big brokerage arm (think BoA). Those guys have been/are going to do kinda crappy because their main clients (semi-rich private investors) are pulling out.
Just my 2 cents
I agree w u here
I agree w u here
monkey that is exactly what i am affrraed of when ever a fuckin layoffs are announced the stock price goes up 2% then another .3% then back down 2% GENERALLY that is 3 days wasted when that shit should be going down down down down down dooooowwn even if the sky is falling down
What I think you are seeing there is that generally layoffs are good for the bottom line. Most firms in the past 5 years have actually increased performance after layoffs as they have kept performance and production steady, due in part to automation, in part to offshoring, and part to squeezing workers. This is why productivity is so high right now.
Performance for MS has been down today and for about the past two weeks. But for the month it's been flat, and is more or less treading water right now in the larger cycle. I would say that the hiring freeze is a really bad sign; if you look at the compensation structure and costs of a firm like this the new hires are obviously the lowest cost, plus it means that in 6-18 months they will start losing real talent higher up the food chain. Usually a firm that starts to cut things that are necessary for future growth (like the baby bells cutting R&D during the 80s) are doing so so that they don't cut the things necessary for current survival.
I would say that at best guess, a lot of people are going to find that their xmas bonus is a pink slip.
I would look at banks w/ decreasing trading ops and increasing brokerage outfolws.
I would not bet against banks with significant continuing gov't support on the B/S and lower p/e values compared to peers.
SCHW and ETFC are looking pretty ripe for a fundamental short.
I've been short ms since $ 27. I want to say its nearly bottomed but I think the earnings expected warrant a new valuation that prices the stock at around 25 dollars a share tops and wouldn't be surprised to see 22 a share
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